IN THE EMPLOYMENT COURT
CHRISTCHURCH
[2016] NZEmpC 34
EMPC 36/2016
IN THE MATTER OF
an application for leave to file a challenge
out of time
BETWEEN
ADVANCE INTERNATIONAL
CLEANING SYSTEMS (NZ) LIMITED
Applicant
AND
STEVEN HAMILTON
Respondent
Hearing:
(on the papers filed on 11 and 25 February, 3 and 10 March
2016)
Counsel:
J Nadan, agent for the applicant
J Beck, counsel for the respondent
Judgment:
7 April 2016
JUDGMENT OF JUDGE B A CORKILL
Introduction
[1]
Advance International Cleaning Systems (NZ) Limited (Advance) has
brought an application for leave to file a challenge to a determination of the
Employment Relations Authority (the Authority) out of time.1 That application is
opposed by Mr Steven Hamilton. The issue is whether the relevant extension should
be granted.
The Authority’s determinations
[2]
Mr Hamilton had worked as the Branch Sales Manager of the Dunedin
branch of Advance from November 2012 until his position was disestablished
1
Hamilton v Advance International Cleaning Systems (NZ) Ltd [2015] NZERA Christchurch 153
(first determination).
ADVANCE INTERNATIONAL CLEANING SYSTEMS (NZ) LIMITED v STEVEN HAMILTON NZEmpC
CHRISTCHURCH [2016] NZEmpC 34 [7 April 2016]
through redundancy.
He asserted that his dismissal was substantively and
procedurally unjustified, and that there was pre-determination. He also contended
that he was unjustifiably disadvantaged.
[3]
The company asserted that Mr Hamilton’s redundancy was genuinely
necessary for financial reasons, that the process was fair and that the company had
acted in good faith.
[4]
In its determination of 13 October 2015, the Authority concluded that
Mr Hamilton had been unjustifiably dismissed and unjustifiably disadvantaged, with
the result that Advance should pay him the sum of $6,957.53 gross in lost wages, and
$8,000 compensation for humiliation, loss of dignity and injury to his feelings.2
Chronology
[5]
For the purposes of considering the application for leave now made by
Advance, it is necessary to set out in some detail the chronology of events which
occurred after the issuing of the initial determination on 13 October 2015.
[6]
Soon after the first determination was issued, Mr Nadan, on behalf of
Advance, advised Mr Hamilton’s lawyer, Ms Beck, that a challenge would be
brought by the company.
[7]
On 16 October 2015, the Authority issued a second determination, in which
the Member advised that she was reopening the investigation on her own account
under cl 4 of Sch 2 of the Act, so as to deal with contribution issues.3 She directed
that the orders made in the determination of 13 October 2015 were to be stayed until
a further determination was issued.
[8]
On 4 November 2015, the parties filed submissions on that topic.
[9]
On 18 November 2015, the Authority issued a third determination, in which
the Member confirmed she had considered the parties’ submissions as to contribution
and had concluded that Mr Hamilton’s actions were not so blameworthy as to require
2
3
At [73] and [77].
Hamilton v Advance International Cleaning Systems (NZ) Ltd [2015] NZERA Christchurch 155
(second determination).
a reduction of remedies.4 Accordingly, there was no change to the orders made in
the initial determination, and the stay as to enforcement of orders was discharged.
Costs were reserved, and because it was acknowledged the reopening “may have
muddied the waters for the parties”, a revised timetable for costs submissions was
issued.
[10]
On 1 December 2015, Ms Beck advised Mr Nadan that she was authorised by
Mr Hamilton to accept service of any challenge brought by the company. In the
same communication, a proposal to resolve costs was raised. The parties were able
to reach an agreement as to costs, and a consent determination on that topic was
issued by the Authority on 11 December 2015.5
[11]
The next step in the chronology relates to the attempts undertaken by
Mr Nadan to file a challenge on behalf of Advance. In his submissions, he stated
that this occurred on 15 December 2015. He said:
The applicant filed and sent the application to the Employment Court on
15 December 2015 through overnight courier to ensure the application was
filed within the 28-day period. Out of applicant’s control (sic) the courier
driver did not scan the document on pickup and there was a delay in its
delivery to the Employment Court and the defendant. On further
investigation, it appears there was several other items to be picked up during
the same period from the applicant where the courier driver omitted to
follow its (sic) own internal company procedures.
[12]
Some evidence as to what occurred at this stage is available from the Court’s
file. It is apparent that on 16 December 2015, the requisite filing fee for the lodging
of a challenge, $204.44 was paid by direct credit to the Court.
[13]
Next, reference should be made to a letter sent by the Registry to Mr Nadan
on 21 December 2015. It stated:
4
5
Hamilton v Advance International Cleaning Systems (NZ) Ltd [2015] NZERA Christchurch 177
(third determination).
Hamilton v Advance International Cleaning Systems (NZ) Ltd [2015] NZERA Christchurch 196
(consent costs determination).
Please find enclosed your application received on 21 December 2015 as
challenges to determinations of the Employment Relations Authority must be
filed within 28 days after the date of the determination of the Authority. The
determination is dated 13 October 2015 and any challenge should have been
filed by 10 November 20156.
If you wish to challenge the determination you will have to seek leave of the
Court. You will need to file an application for leave to file a challenge out of
time with a draft statement of claim and an affidavit verifying the grounds in
which the application is made. There is no filing fee associated with this
type of application. Your direct credit of the filing fee paid on
16 December 2015 will be held until a judgment is given in regards to the
application for leave.
A copy of form 2A and an affidavit template are enclosed for your
convenience or they can be located on the Court’s website. …
[14]
Upon receipt of this letter, Mr Nadan sought an explanation from the courier
company as to why it appeared there had been a delay in delivery. The courier
company referred to two deliveries which had been undertaken for Advance, one of
which was effected on 18 December 2015, and the second of which was effected on
21 December 2015. Having regard to the Court’s records as summarised above, I
find that it is the second of these which is relevant for present purposes since the
communication which the Registry received from Advance was delivered on
21 December 2015. The courier information indicates that this item was in fact
uplifted from Advance on 16 December 2015. Since this is the same date as the
filing fee was direct-credited, I find that this was the date on which a courier was
requested and attended, rather than 15 December 2015 as asserted in Mr Nadan’s
submission.
[15]
If the courier had delivered the statement of claim according to expected
delivery specifications, that is the next day, the statement of claim would have been
filed a day late on 17 December 2015.
[16]
Mr Nadan says that the company was only made aware of the late delivery
for filing by the Court, “during January 2016”. I assume that is a reference to the
letter from the Court Registry Officer dated 21 December 2015. Allowing for the
6
The reference in this letter to the dates by which a challenge should have been filed,
10 November 2015, was incorrect; it appears the Court Registry Officer was not provided with
copies of the second and third determinations which related to the reopening of the investigation
of the Authority, and which, it is common ground, resulted in the period to be calculated under
s 179 being extended.
fact that Advance may not have operated in the Christmas/New Year period, I find
that Advance would have received notice of the rejection of its statement of claim in
early January 2016.
[17]
It is evident that rather than file an immediate application for leave,
Mr Nadan took some time first to obtain a letter of explanation from the courier
company which was provided on 26 January 2016, then to prepare an application for
leave and affidavit which was sent under copy of a letter dated 5 February 2016
(although it is unclear whether it was despatched on that date) and not received by
the Court until 11 February 2016.
[18]
The application for leave describes in detail the circumstances giving rise to
Mr Hamilton’s redundancy. It is submitted that factual errors were made by the
Authority, so that the company wishes to elect a de novo hearing. In the company’s
subsequent submissions, reference is made to the apparent issues which arose with
regard to the delivery of the documents by the courier company which had been
instructed to deliver the statement of claim to the Court, and that the interests of
justice required an extension of time.
[19]
For Mr Hamilton, a notice of opposition was filed, followed by submissions
which enlarged on the grounds of opposition.
The essence of Mr Hamilton’s
position is that Advance had until 16 December 2015 to raise a challenge, that
Mr Nadan was clearly aware of the 28-day limitation period; and that the application
for extension was filed on 11 February 2016 which meant there was a substantial
delay of at least 48 days. It was submitted that no reasonable explanation for the
delay had been given, and it was not in the interest of justice to grant the application
for leave made for Advance.
Legal principles
[20]
The legal principles in respect of applications for leave are well known, and
were conveniently summarised by Judge Couch in An Employee v An Employer in
these terms:7
7
An Employee v An Employer [2007] ERNZ 295 (EmpC).
[7] … The Court’s jurisdiction to extend time in such circumstances is
conferred by s 219(1) of the Employment Relations Act 2000 which
provides:
219
Validation of informal proceedings, etc
(1)
If anything which is required or authorised to be done by this Act is
not done within the time allowed, or is done informally, the Court, or
the Authority, as the case may be, may in its discretion, on the
application of any person interested, make an order extending the time
within which the thing may be done, or validating the thing so
informally done.
[8] The discretion conferred by s 219 is not subject to any statutory
criteria. Like any other discretion conferred upon the Court, however, it
must be exercised judicially and in accordance with established principles.
[9] The fundamental principle which must guide the Court in the exercise
of its discretion is the justice of the case. Does the justice of the case require
that the extension of time sought be granted? In their detailed submissions
about what the interests of justice are in this case, both Mr Beck and
Ms French adopted the headings used by Chief Judge Goddard in Day v
Whitcoulls Group Ltd [1997] ERNZ 541 and by Judge Shaw in Stevenson v
Hato Paora College [2002] 2 ERNZ 103:
(1)
The reason for the omission to bring the case within time.
(2)
The length of the delay.
(3)
Any prejudice or hardship to any other person.
(4)
The effect on the rights and liabilities of the parties.
(5)
Subsequent events.
(6)
The merits of the proposed challenge.
[10] I agree that these are convenient and appropriate headings under
which to consider the matters relevant to the exercise of my discretion in this
case, albeit that I do so in a different order.
[11] In addition to those factors which the Court has found it appropriate to
consider in considering whether to extend time for filing a challenge under
s 179, I also have regard to the well established principles applicable to
applications for extensions of time generally. In Ratnam v Cumarasamy
[1965] 1 WLR 8; [1964] 3 All ER 933 (PC), the Privy Council said at
page 12; p 935:
The rules of court must, prima facie, be obeyed, and, in order to
justify a court in extending the time during which some step in
procedure requires to be taken, there must be some material on which
the court can exercise its discretion. If the law were otherwise, a party
in breach would have an unqualified right to an extension of time which
would defeat the purpose of the rules which is to provide a time table
for the conduct of litigation.
[12] I also have regard to the general principle summarised by Richmond J
in Avery v No 2 Public Service Appeal Board [1973] 2 NZLR 86 (CA) at
p 91:
When once an appellant allows the time for appealing to go by
then his position suffers a radical change. Whereas previously he was
in a position to appeal as of right, he now becomes an applicant for a
grant of indulgence by the Court. The onus rests upon him to satisfy the
Court that in all the circumstances the justice of the case requires that
he be given an opportunity to attack the judgment from which he wishes
to appeal.
[21]
Also of assistance is the dicta of Judge Shaw in Motorpol Australasia Limited
v Roche, where her Honour observed:8
In some cases even a minimal delay will not avail an applicant with an
unmeritorious challenge but in others a long delay for which there is a good
explanation may not be fatal where there are strong grounds to anticipate a
successful challenge.
[22]
I respectfully agree with the foregoing principles. I note that in the end I
must stand back and consider whether the justice of the case, including the reason
delays have occurred, warrants the granting of leave.
Reasons for delay
[23]
Much has been made of the fact that the courier company involved did not
deliver the plaintiff’s statement of claim to the Court within the anticipated
timeframe. However, even had the courier met those expectations, the statement of
claim would have been filed a day late – albeit the filing fee had been paid on the last
day of the period within which a challenge needed to be filed.
[24]
It is evident that Mr Nadan left the filing of the company’s challenge to the
last day within which it should have been filed, and took no steps to ensure that it
was successfully filed that day, as he could have.
[25]
Had the document been received by the Court on 17 December 2015, the day
on which it was reasonable to expect it to be filed after pickup by the courier on
16 December 2015, I find that Mr Nadan would have been advised by the Court that
an application for leave would need to be brought.
8
Motorpol Australasia Ltd v Roche [2006] ERNZ 253 (EmpC) at [15].
[26]
Because any period of delay is calculated from the date on which the 28-day
period expired through to the date in which the application for leave is filed, any
party in this situation is well advised to file their application for leave immediately.
Had that occurred in this case, any delay would have been minimal, and the Court is
likely to have made the order sought without difficulty.9
[27]
While no explanation has been given by Mr Nadan as to why it took so long
to obtain the necessary information from the courier company, prepare an
application, and then have it filed, there are two mitigating factors which I must take
into account. The first is that there must be some recognition of the fact that the
Christmas/New Year period occurred which may have contributed to a delay in
Mr Nadan learning of the situation which had arisen, and when, in any event, the
Court office was closed.
[28]
Regulation 74B of the Employment Court Regulations 2000 provides that, for
the purposes of calculating when an act must be done, the 12 days starting with
25 December and ending with 5 January should not be counted. Whilst, in the
present case, I am considering the extent of the delay which occurred after a step
should have been undertaken, it is nonetheless appropriate to take this factor into
account when considering reasons for a delay – rather than the alternative of
regarding this factor as truncating the period of delay. This was the approach
adopted by Judge Couch in An Employee v An Employer, with which I respectfully
agree.10
[29]
The second factor which I note is that Mr Nadan is not a lawyer or advocate
expected to be familiar with the procedural requirements of the Court. However, this
is not a determinative factor because the Court did explain to Mr Nadan the steps he
needed to take, and the Court’s website to which Mr Nadan was referred by the
9
10
I note that the Court Registry Officer in her letter of 21 December 2015 referred Mr Nadan to the
relevant portion of the Employment Court website which deals with applications for leave to
extend time for filing a challenge. In dealing with the issue of time limits for such an
application, it is stated that such an application should be filed “as soon as you become aware
that you will not be able to file a challenge on time; or as soon as the time for filing … has
expired.”
An Employee v An Employer, above n 7, at [14].
Court Registry Officer indicated that an application for leave was one which should
be undertaken promptly.
[30]
Even allowing for the fact that the courier company did not provide an
explanation in writing as to its role in the matter until 26 January 2016, there is no
explanation as to why the application for leave was not filed until 11 February 2016.
[31]
In summary, there are some factors which are relevant to the delay, but it is
still unclear as to why delay occurred to the extent which it did.
Length of delay
[32]
The length of delay which occurred here, some 48 days, is significant and
excessive. It is a factor which points against the grant of leave, especially where an
incomplete explanation as to delay is given.
Prejudice to the respondent
[33]
Whilst I accept Ms Beck’s submission that Mr Hamilton was entitled to
conclude, soon after the expiry of the 28-day time limit, that no challenge had been
filed, against that needs to be considered the advice that had been given by
Mr Nadan on 15 October 2015, that a challenge would be brought. In the following
two months, some uncertainty was created by the reopening of the investigation,
although that situation was resolved by 18 November 2015 when the third
determination was issued. Two weeks later, Ms Beck informed Mr Nadan that she
was authorised to accept service, which confirms there was an expectation that the
matter would be taken further.
[34]
Whilst the delay which arose in this case is regrettable, and it was no doubt a
disappointment to Mr Hamilton to find that the matter was not resolved as he was
entitled to assume by early 2016, no other evidence has been provided as to
prejudice which would thereby arise. I do not regard the non-compliance with time
limits as creating such prejudice to Mr Hamilton as to lead to a conclusion that leave
should not be granted for that reason.
The merits of the proposed challenge
[35]
I have reviewed carefully the considerable information provided as to the
merits of this matter as the company sees it; this information is contained in
Mr Nadan’s affidavit in support of the application for leave, in the intended
statement of claim and in the first determination of the Authority.
[36]
In response, Ms Beck has submitted that Mr Hamilton denies the allegation
that the Authority did not take account of all factual matters; she also submits that it
is not clear from the intended statement of claim which part of the determination is
being challenged. She argues that the company was provided with a full opportunity
to present its case in the Authority which it did, and no injustice has arisen from the
conclusion reached since the Authority took into account all matters before making
its determination.
[37]
It is clear that an assessment of the grounds for redundancy, and the steps
taken to effect it, would require a careful consideration of information which the
Court does not have, including detailed sales information relating to the viability of
the Dunedin branch of Advance, which was where Mr Hamilton had been Managing
Director for some 35 years.
[38]
On the information available to the Court at present, I conclude that the
intended challenge does raise genuine issues for assessment. Those issues will
require a careful evaluation of a fact scenario of moderate complexity, and to some
extent a consideration of credibility because of the differing accounts given by each
party.
[39]
As best can be determined on the basis of the material before the Court at
present, it is appropriate to conclude that, all other things being equal, the company
should have the opportunity of having its concerns considered by the Court.
Subsequent events
[40]
In the present case, this rubric requires an overall assessment of the events
which followed the issuing of the first determination. Relevant in my view is the
fact that the company gave prompt notice of its intention to bring a challenge, and
that it ultimately attempted to proceed in accordance with the rules, albeit that it left
it to the very last day of the period provided for challenges to do so. The filing fee
was successfully paid on that day.
[41]
This is to be contrasted with the situation where an applicant does nothing at
all until the filing of an application for leave after delay has occurred.
[42]
In my view, this factor is one pointing to the granting of leave.
Conclusion
[43]
Whilst there was unacceptable delay in bringing the application for leave
once the problem as to filing had arisen, and to some extent the explanation given is
incomplete, I must also consider the advice which was given initially of an intended
challenge, the attempt to file the challenge at the end of the 28-day period allowed
for doing so, as well as my assessment that the intended challenge is one which
should be heard.
[44]
Accordingly, I grant leave to the applicant and extend time for the filing of its
statement of claim to seven days after the date of this judgment. The filing fee has
already been paid.
[45]
Although the applicant has been the successful party, it has been granted an
indulgence so costs should not follow the event. I order that costs relating to the
application should lie where they fall.
B A Corkill
Judge
Judgment signed on 7 April 2016 at 3.30 pm