Flageul v WeDrive Pty Ltd

• Jurisdiction: Australia Federal only
• Judgment Date: 18 November 2020
• Neutral Citation: [2020] FCA 1666
• Court: Federal Court
• Date: 18 November 2020

Federal Court of Australia

Flageul v WeDrive Pty Ltd [2020] FCA 1666

File number:	VID 653 of 2018
Judgment of:	STEWARD J
Date of judgment:	18 November 2020
Catchwords:	INDUSTRIAL LAW – termination of employment – where applicant through his company developed ride sharing app – where that company assigned associated intellectual property to newly incorporated first respondent after due diligence conducted by third respondent – where applicant appointed as C.E.O. of first respondent – where minority of shares in first respondent issued to applicant – where majority of shares in first respondent issued to second and third respondents – where first respondent’s financial performance following assignment of intellectual property fell below expectations of second and third respondents – where functionality of app fell below expectations of second and third respondents – where second and third respondents discovered that applicant’s company did not own all intellectual property associated with app before assignment – where applicant subsequently dismissed as C.E.O. – where applicant and second and third respondents each agreed to step down as directors of first respondent and to sell all shares for $1 – where applicant made series of alleged complaints or inquiries to second and third respondents prior to dismissal as C.E.O. – where applicant allegedly worked pursuant to consultancy agreement following dismissal as C.E.O. and end of associated notice period – whether applicant exercised workplace rights – whether applicant made “complaints” or “inquiries” for purposes of s. 341(c)(ii) of Fair Work Act 2009 (Cth.) – whether complaints or inquiries “in relation to” applicant’s employment as C.E.O. for purposes of s. 341(c)(ii) – whether applicant “able” to make complaints or inquiries for purposes of s. 341(c)(ii) – whether adverse action taken “because” of applicant exercising workplace rights – whether s. 358 breached because applicant dismissed in order to be engaged as independent contractor to perform same or substantially same work under contract for services ; CORPORATIONS – oppression – whether conduct of respondents oppressive to unfairly prejudicial to or unfairly discriminatory against applicant as member of first respondent whether in that capacity or any other capacity for purposes of s. 232 of Corporations Act 2001 (Cth.) ; EQUITY – unconscionable conduct – where applicant allegedly subject to special disadvantages including mental health issues – where applicant alleged respondents aware of mental health issues and other special disadvantages – whether conduct of respondents towards applicant unconscionable within meaning of unwritten law for purposes of s. 20 of Australian Consumer Law ; COSTS – whether power to award costs under s. 570 of Fair Work Act 2009 (Cth.) should be exercised as against applicant
Legislation:	Competition and Consumer Act 2010 (Cth.) Sch. 2, s. 20 Corporations Act 2001 (Cth.) ss. 9, 202B, 232, 233, 290, 1317AA Fair Work Act 2009 (Cth.) ss. 340, 341, 342, 358, 360, 361, 570 Crimes (Mental Impairment and Unfitness to be Tried) Act 1997 (Vic.) s. 20 Occupational Health and Safety Act 2004 (Vic.) ss. 21, 25
Cases cited:	Australian and Consumer Commission v. Quantum Housing Group Pty Ltd (No 2) [2020] FCA 802 Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union v. Visy Packaging Pty Ltd (No 3) (2013) 216 F.C.R. 70 Browne v. Dunn (1894) 6 R. 67 Hill v. Compass Ten Pty Ltd (2012) 205 F.C.R. 94 Joint v. Stephens [2008] VSCA 210 Lamont v. University of Queensland (No 2) [2020] FCA 720 Maric v. Ericsson Australia Pty Ltd [2020] FCA 452; (2020) 293 I.R. 442 McKerlie v. Western Australia (No 2) [2006] WASCA 274 Melbourne Stadiums Ltd v. Sautner (2015) 229 F.C.R. 221 MWJ v. The Queen [2005] HCA 74; (2005) 80 A.L.J.R. 329 PIA Mortgage Services Pty Ltd v. King (2020) 274 F.C.R. 225 R v. Kucma (2005) 11 V.R. 472 Republic of Nauru v. WET040 (No 2) [2018] HCA 60; (2018) 93 A.L.J.R. 102 Sanders v. Glev Franchises Pty Ltd [2002] FCA 1332 Shea v. TRUenergy Services Pty Ltd (No 6) [2014] FCA 271; (2014) 314 A.L.R. 346 The Environmental Group Ltd v. Bowd [2019] FCA 951; (2019) 288 I.R. 396 The Environmental Group Ltd v. Bowd (No 2) [2019] FCA 1227 Thorne v. Kennedy (2017) 263 C.L.R. 85 Wayde v. New South Wales Rugby League Ltd (1985) 180 C.L.R. 459
Division:	Fair Work Division
Registry:	Victoria
National Practice Area:	Employment and Industrial Relations
Number of paragraphs:	345
Date of last submission/s:	10 July 2020
Date of hearing:	22-26 June 2020
Counsel for the Applicant:	Mr. D.G. Robertson, Q.C. with Ms. J. Zhou
Solicitor for the Applicant:	AJH Lawyers
Counsel for the Respondents:	Mr. A. Meagher
Solicitor for the Respondents:	Clyde & Co

ORDERS

		VID 653 of 2018
BETWEEN:	YAN FRANCK FLAGEUL Applicant
AND:	WEDRIVE PTY LTD T/A WEDRIVE (ABN 47 621 317 324) First Respondent ; STEVEN MACE Second Respondent ; GREGG TAYLOR Third Respondent

order made by:	STEWARD J
DATE OF ORDER:	18 NOVEMBER 2020

THE COURT ORDERS THAT:

1. The proceeding be dismissed.

2. There be no order as to costs.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

STEWARD J.:

1. Once again, a chief executive officer (“C.E.O.”) has had a tragic falling out with his fellow board members. The applicant (“Mr. Flageul”) was C.E.O. of the first respondent, WeDrive Pty Ltd (“WeDrive”), a company incorporated on 25 August 2017. Mr. Flageul (as trustee of the We Drive Melbourne Trust) was also a shareholder in, and a director of, WeDrive. On 21 December 2017, the second respondent (“Mr. Mace”), a non-executive director of WeDrive (and, through a company owned or controlled by him, its majority shareholder), terminated Mr. Flageul’s employment as C.E.O. Subsequently, Mr. Flageul resigned as a director of WeDrive and sold his shares in that company for $1. Mr. Flageul has sued WeDrive, Mr. Mace, and another director of WeDrive, who is the third respondent (“Mr. Taylor”). Mr. Taylor also owned shares in WeDrive through a company he either owned or controlled, and was the executive chairman of WeDrive. Mr. Flageul seeks the payment of pecuniary penalties under the Fair Work Act 2009 (Cth.) (the “F.W. Act”), damages pursuant to that Act, the Corporations Act 2001 (Cth.) (the “Corporations Act”) and the Australian Consumer Law (“A.C.L.”) as set out in Sch. 2 to the Competition and Consumer Act 2010 (Cth.), as well as certain declarations. His causes of action comprise claims of adverse action, breach of s. 358 of the F.W. Act, and claims of oppression and unconscionable conduct on the part of the respondents. An additional claim...