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[2014] FCA 1103
Federal Court of Australia
2014-10-13
Katzmann J
Original judgment source is linked above.
REASONS FOR RULING (Revised from transcript) 1 Dr Kate Barton was formerly employed by Lake Macquarie City Council as its sustainable living team leader and later coordinator, managing energy, water, waste and transport across the city and in the Council. She claims that she was bullied by Council employees and that the bullying and the Council's response to it were in breach of her contract of employment. 2 The bullying allegations are primarily directed against one Alice Howe, who originally held a position at an equivalent level to Dr Barton, but who was later elevated to a position as her immediate supervisor. Dr Barton claims that she made some informal attempts to have the alleged bullying addressed but that the situation deteriorated, rather than improved, thereafter. After a heated telephone discussion with Dr Howe on 13 February 2012 Dr Barton fell ill and was later diagnosed with stress cardiomyopathy. The next day she made a formal complaint about Dr Howe's conduct and was absent from work for about six weeks. 3 At that point Dr Barton was certified fit to work for modified hours only and with no interaction with Dr Howe. But during those periods when she was working under these restrictions she claims she was bullied by other Council employees and generally treated in an inappropriate way. In October 2012 she was stood down from her employment and a couple of weeks before this trial was due to begin her employment was terminated. Dr Barton alleges that this treatment was also in breach of her contract. Furthermore, she alleges that it amounted to victimisation contrary to the Disability Discrimination Act 1992 (Cth) ("DDA"). Both parties have filed and served a mountain of evidence, a good deal of which is the subject of objection. 4 The particular dispute with which this judgment is concerned relates to expert evidence Dr Barton wishes to call in reply. The evidence is the subject of affidavits from Dr Helen McGrath, a counselling psychologist and academic, and Anne Sutherland Kelly, a practitioner and teacher in the field of mediation. 5 On 8 August 2014 Gleeson J ordered that Dr Barton file and serve her evidence in reply by 28 August 2014. The affidavits from both these witnesses were not filed and served within that time. Indeed, they were not served until 5 September and not filed until 10 September 2014. 6 The Council objects to Dr Barton being able to rely on the evidence and has asked for an early ruling. The grounds of the objection are that: (1) the evidence is not relevant; (2) even if the evidence were relevant (inferentially to Dr Barton's case in chief), the Council has lost an opportunity to call evidence in response; (3) the evidence is not "properly" evidence in reply because it deals with issues which arise in Dr Barton's case in chief; (4) the evidence was called in contravention of Court orders. 7 There is an evident tension between grounds 1 and 3. 8 The Council also argues that Dr McGrath's evidence should not be admitted because it "usurps the function of the Judge in determining the issues in dispute". 9 In each case Dr Barton contends that there has been no breach of Court orders, the evidence is relevant and is in truth evidence in reply. The argument is that the evidence is to be called to rebut the Council's defence to the discrimination claim. To understand the argument it is first necessary to say something more about the discrimination case and to refer to some of the provisions of the DDA. 10 Section 15(2) of the DDA relevantly provides that: It is unlawful for an employer or a person acting or purporting to act on behalf of an employer to discriminate against an employee on the ground of the employee's disability: (a) in the terms or conditions of employment that the employer affords the employee; or (b) by denying the employee access, or limiting the employee's access, to opportunities for promotion, transfer or training, or to any other benefits associated with employment; or (c) by dismissing the employee; or (d) by subjecting the employee to any other detriment. 11 Discrimination may be either direct or indirect. Direct discrimination is dealt with in s 5 of the DDA, indirect discrimination in s 6. 12 Relevantly, direct discrimination will occur on the ground of the employee's disability if the employer does not make or propose to make reasonable adjustments for the employee and the failure to make those adjustments has, or would have, the effect that the employee is, because of the disability, treated less favourably than a person without the disability would be treated in circumstances that are not materially different: s 5(2). Dr Barton's case is that the Council did not make reasonable adjustments for her to accommodate her disability or disabilities. In her statement of claim Dr Barton pleads that the adjustments that could have been made include: taking reasonable steps to investigate Dr Barton's written complaint and the bullying that took place in 2009 and in 2011-2012, such as those set out in the Council's own policies and procedures; and taking reasonable steps to limit the stress experienced by Dr Barton as a result of her interactions with Dr Howe and/or preventing the bullying from continuing once she returned to work, including but not limited to: (a) changing the reporting structure for the role of sustainable living coordinator, so that Dr Barton reported to someone other than Dr Howe; (b) continuing the reporting structure that had operated in which Dr Barton reported to someone else (Anthony Farrell) (in a position to which Dr Barton had been seconded before her absence from work); (c) extending Dr Barton's secondment; (d) offering Dr Barton alternative duties with the Council where her skills could have been utilised; (e) not directing a mediation with Dr Howe before Dr Barton had been certified fit to do so by her treating doctors; (f) obtaining an occupational medical assessment aimed at identifying "reasonable accommodations" that could be made to allow Dr Barton to return to work. 13 The Act defines "reasonable adjustment" in such a way as to deem an adjustment to be made by a person to be reasonable unless making the adjustment would impose an unjustifiable hardship on that person: DDA, s 4. The burden of proving that something would impose unjustifiable hardship rests with the person who asserts it; in this case, the Council: DDA, s 11(2). 14 "Unjustifiable hardship" is defined in s 11(1) of the DDA: For the purposes of this Act, in determining whether a hardship that would be imposed on a person (the first person) would be an unjustifiable hardship, all relevant circumstances of the particular case must be taken into account, including the following: (a) the nature of the benefit or detriment likely to accrue to, or to be suffered by, any person concerned; (b) the effect of the disability of any person concerned; (c) the financial circumstances, and the estimated amount of expenditure required to be made, by the first person; (d) the availability of financial and other assistance to the first person; (e) any relevant action plans given to the Commission under section 64. (Original emphasis.) 15 It is common ground that the factors listed in paragraphs (a) to (e) are not exhaustive of the circumstances that must be taken into account. 16 The Council appears to rely on paragraphs (a)-(c). Relevantly, the Council pleaded in its defence that: in order for Dr Barton to occupy a role within the Sustainability Department and for this not to constitute a demotion and/or not to involve at least some contact with the Manager of Sustainability (Dr Howe's position), an organisational restructure would be required at substantial cost to the Council; the Waste Strategy Project to which Dr Barton had been seconded has now been returned to the Sustainability Department; the reporting structure under which Dr Barton was not required to report to Dr Howe was only appropriate while the Waste Strategy Project was conducted outside the Sustainability Department: to continue the Waste Strategy Project outside the Sustainability Department would be costly; and it would be an unjustifiable hardship for the Council to dismiss Dr Howe. 17 Indirect discrimination is described in s 6. Relevantly, s 6 provides: (1) For the purposes of this Act, a person (the discriminator) discriminates against another person (the aggrieved person) on the ground of a disability of the aggrieved person if: (a) the discriminator requires, or proposes to require, the aggrieved person to comply with a requirement or condition; and (b) because of the disability, the aggrieved person does not or would not comply, or is not able or would not be able to comply, with the requirement or condition; and (c) the requirement or condition has, or is likely to have, the effect of disadvantaging persons with the disability. (2) … (3) Subsection (1) … does not apply if the requirement or condition is reasonable, having regard to the circumstances of the case. (4) For the purposes of subsection (3), the burden of proving that the requirement or condition is reasonable, having regard to the circumstances of the case, lies on the person who requires, or proposes to require, the person with the disability to comply with the requirement or condition. (Original emphasis.) 18 The Council admits that (from 12 October 2012 until 18 August 2014 when Dr Barton was dismissed) it required Dr Barton to participate in a mediation with Dr Howe and/or to have direct contact with her during the course of her employment. Dr Barton contends that she was unable to, or would not, comply with the requirement because of the nature of her disability and/or her understanding of it. 19 In its defence the Council pleaded that it was reasonable to require Dr Barton to have direct contact with Dr Howe and to engage in a mediation with her. It also pleaded that it took reasonable steps to prevent bullying, referring to its various policies and the training it provides to its employees. On 7 March 2014 it filed evidence to support the pleading. The evidence of Dr McGrath and Ms Kelly is said to respond to this. 20 Dr Barton's lawyers provided each of the witnesses with a number of documents and then asked them a series of questions. Although each was asked to "list the facts, matters and assumptions" upon which her opinion was based, neither did. This presents some difficulties for the evaluation of the evidence, because it is not at all clear what assumptions of fact were made and therefore what the factual foundations for the opinions were. The situation would have been otherwise if, as is customary, the witnesses had instead been asked to make certain assumptions Dr Barton expected to be able to prove through the lay witnesses and the documents. But these difficulties may be put to one side for the moment at least, because no objection was taken to the evidence on this basis.
The evidence of Ms Kelly 21 Ms Kelly's evidence focusses on the conduct of Danielle Carney, a mediator with a private consulting firm who was engaged by the Council to facilitate Dr Barton's return to work. In her affidavit Ms Carney states that she was contacted by the Council's human resources manager, Tim Hopson, to conduct a mediation between Dr Barton and Dr Howe "to assist with the transition of Dr Barton back into Dr Howe's direct reporting line". It is common ground that no such mediation ever took place. Dr Barton agreed to a mediation but not with Dr Howe. Ms Carney did, however, have a number of conversations with Dr Barton. They met on 16 August to discuss the return to work plan. Ms Carney also corresponded by email with Dr Barton and on one occasion they had a meeting which Mr Hopson also attended. 22 Ms Kelly's evidence is said to go to the reasonableness of the requirement to mediate with Dr Howe and the Council's evidence on the subject. 23 Two questions were asked of Ms Kelly: (1) whether the work done by Ms Carney "as set out in her evidence" was carried out in accordance with national standards for mediators; (2) whether the work done by Ms Carney "as set out in her evidence" was "appropriate" in all the circumstances of the case, including the alleged bullying of Dr Barton by Dr Howe. 24 In short, Ms Kelly answered "no" to both questions. The report was critical of the approach taken by Ms Carney, in particular, of her failure to assess whether mediation was "suitab[le] … as an intervention, with particular regard to power dynamics and occupational health and safety risks". 25 Putting aside the difficulties presented by the use of the weasel word "appropriate", neither of these questions is raised by the pleadings and the opinions expressed in the report do not deal with the issue Ms Kelly's evidence was said to address. Whether or not Ms Carney carried out her work in accordance with national standards for mediators or failed to independently assess whether mediation was suitable in this case is not in issue in the proceeding. Ms Carney is not a respondent. Nor is she an employee of the respondent. The statement of claim has been amended at least five times but Dr Barton has never alleged that the Council is liable for the acts or omissions of Ms Carney. 26 Accordingly, I am not satisfied that Ms Kelly's evidence is relevant in the proceeding. Evidence that is not relevant in a proceeding is not admissible. It follows that Dr Barton will not be able to read Ms Kelly's affidavit or tender her report.
The evidence of Dr McGrath 27 Dr McGrath's evidence is contained in an undated report annexed to her affidavit. It begins with a "preamble" purportedly summarising "the key features of (scil.) best practice in preventing and managing workplace bullying". There, Dr McGrath refers to legislative attempts to address workplace bullying and a decision of the NSW Industrial Relations Commission in a prosecution under the NSW occupational health and safety (OHS) legislation. 28 The second section of the report contains a commentary on workplace bullying and an opinion about how it should be defined. 29 The third section addresses the effects of bullying. The fourth provides "an overview of what an organisation should provide". In particular, it discusses the need for: "all organisational documents" dealing with risk assessment and risk management and codes of conduct and ethical practices or the like to contain specific references to "psychosocial risks" (emphasising bullying as the main risk); an effective bullying policy and procedures manual, what it should contain and how it should be developed; training of all employees "in the [u]nderstandings and [s]kills that [u]nderpin a [s]afe and [h]ealthy [w]orkplace and to [s]upport the [i]mplementation of the [p]olicy"; specific actions to be taken to prevent bullying and to promote safe, supportive and respectful working relationships; procedures for effectively responding to and managing a bullying situation. 30 The fifth section deals with "specific actions for preventing bullying and promoting safe, supportive and respectful workplace relationships", the sixth with procedures for responding effectively to and managing "a bullying situation". The seventh section discusses the role of the human resources department, specifically with the process of investigation, disciplinary actions, "restorative justice", mediation and ongoing review. 31 Finally, Dr McGrath turns to the questions she was asked to address. 32 Those questions are: (1) whether the Council's policies and procedures relating to bullying (both specifically and indirectly, such as the OHS policies and the grievance handling procedures) were "appropriate". (2) if not (either in whole or in part), what additional policies and procedures should have been followed? (3) whether the training provided by the Council was "adequate and appropriate". (4) if not (whether in whole or in part), what training should have been provided? (5) whether strategies in addition to training should have been, and were not, employed to ensure bullying did not occur. (6) whether mediation between Dr Barton and Dr Howe was "appropriate in the circumstances of this case". (7) whether Dr Barton should have been directed to work with Dr Howe in the circumstances of the case "as set out in the evidence". (8) in relation to Dr Barton's complaint of bullying against Dr Howe: (a) whether it was appropriately addressed by her managers before she made her formal complaint on or about 14 February 2014; (b) whether the investigation done by (the private investigator) Scott Cook was "appropriate" and the findings associated with the investigation "sound"; (c) whether the investigation done by Mr Hopson was "appropriate" and the findings associated with his investigation "sound"; and (d) whether the processes actually followed by the Council were "consistent with its policies and procedures and best practice overall". (9) whether there was a risk to the health and safety of Dr Barton arising from the way in which she was treated by Council employees and agents (including Ms Carney) upon her return to work. A number of subsidiary questions are then put. 33 The Council conceded that the question of training was raised by its defence and does arise in reply. The Council maintained, however, that the other matters arose in Dr Barton's case in chief, referring to the list of contractual breaches Dr Barton filed at the direction of the Court on 8 September 2014, which includes among the alleged breaches the following conduct: failing to investigate Dr Barton's written complaint between 14 February and 23 April 2012; directing Dr Barton to engage in mediation with Dr Howe; various features of the investigation into her complaint; the Council's requirement that she work directly with Dr Howe from 15 October 2012. 34 The allegation Dr Barton makes that this conduct constitutes a breach of the employment contract is based on the Council not complying with its own policies. Thus, the question of whether the processes that were followed were consistent with Council's policies and procedures (Q 8(d)), which is unlimited as to time, goes to the heart of Dr Barton's contract claim. That said, it does not appear that Dr McGrath deals with this part of the question. The investigation of Dr Barton's complaint (raised by Q 8(b) and (c)) is relevant not only to her contract claim but also to her discrimination case that reasonable adjustments were not taken to accommodate her disability. 35 Whether Dr Barton's complaint of bullying against Dr Howe was appropriately addressed by her managers before she made her formal complaint on 14 February 2012 (question 8(a)) does not appear to be relevant to the discrimination claim, since she is not said to have been under a disability before she stopped work on 14 February 2012. It cannot therefore be relevant to the Council's defence to that claim. 36 Ultimately, however, with this exception, I am persuaded that the questions Dr McGrath addresses could rationally affect (either directly or indirectly) the assessment of the probability of the existence of a number of facts in issue as a result of the Council's defence and the evidence it proposes to lead. Her opinion is therefore relevant and admissible (see Evidence Act 1995 (Cth), ss 55, 56) subject to a submission by the Council to which I will come shortly. Those facts in issue include: whether it was reasonable to require Dr Barton to have direct contact with Dr Howe after 14 February 2012; whether it was reasonable to require Dr Barton to engage in a mediation with Dr Howe; and whether the steps the Council took to prevent bullying (listed in paragraphs 201 to 208 of the defence and more fully described in Mr Hopson's evidence) were reasonable as the Council alleged in its defence. 37 Any risk to Dr Barton's health, for example, arising from her treatment at the hands of Council employees is a matter which could (at least indirectly) rationally bear on the question of whether it was reasonable to require Dr Barton to have direct contact with Dr Howe or to mediate with her. 38 I am also satisfied that for the same reasons the opinion may be described as evidence in reply. At the same time some of Dr McGrath's opinions are also relevant to issues arising in Dr Barton's case in chief. 39 The submission to which I referred, at [36] above, is that Dr McGrath's opinion as to what constitutes bullying does not "go beyond a mere ipse dixit" (Makita (Australia) Pty Ltd v Sprowles (2001) 52 NSWLR 705 at [87] (Heydon JA)) and the report fails to disclose the source of the definition and thus how Dr McGrath's opinions were based on her specialised knowledge. I would not reject the report on this basis. 40 Dr McGrath states in her report that "[t]here is general agreement amongst researchers and professionals working in the area of workplace bullying" as to what the definition of workplace bullying should include. Although this statement is not footnoted, she has listed a number of references in her report and, according to her resume, she has considerable experience counselling people "around bullying-related issues" and lecturing and presenting seminars and workshops focussing on bullying, both in schools and in workplaces. She has also run training workshops on workplace bullying for staff in a range of organisations, addressed conferences, and given expert advice and evidence on the subject. There is some force in the submission that the report does not make it plain how each of Dr McGrath's opinions is based on her training, study or experience but, as Dr Barton submitted, the report must be read as a whole. The earlier part of the report is peppered by references to the literature. 41 I also reject the submission that Dr McGrath's evidence should be not be admitted because it usurps the function of the judge. Section 80 of the Evidence Act provides that evidence of an opinion is not inadmissible only because it goes to the ultimate issue. The concern expressed by Mason P in R v GK (2001) 53 NSWLR 317 at [40] does not arise here. The Council did not suggest that the opinions in question "arrogate expertise outside their field or express views unsupported by disclosed and contestable assumptions". 42 The remaining consideration relates to the Council's submission that the report was filed and served outside the time permitted by Gleeson J's order and in these circumstances the Court should refuse Dr Barton leave to rely on it. 43 For a time I was attracted to this submission. Her Honour's order required that evidence in reply be filed and served by 28 August 2014 and Dr McGrath's evidence was filed and served outside the time permitted by the order and in the absence of any application for an extension of time or further order, or any explanation for the delay. During argument, however, I was taken to the transcript of the directions hearing at which the order was made. After noting that counsel wanted to "pursue" the question of "bullying evidence in reply", her Honour said: If that's the case, then they should either file evidence of that kind as soon as possible - I won't make a particular time limit on that, but at the moment as soon as possible so that the respondents have an opportunity to see it. If the suggestion is that that evidence is not going to be supplied within an appropriate time before the hearing, then there needs to be an application of some kind which will either be to vacate the hearing or to put forward some way in which the hearing can proceed, which I can't immediately bring to mind. 44 When her Honour made the order, Ms Edwards of counsel, who appeared for Dr Barton, sought clarification of whether it was the lay evidence which should be filed by 28 August. Her Honour replied "correct". Any application to file expert evidence was to be made separately if it could not be filed by that date. While no formal application was made, the Council was under no illusion that Dr Barton did not intend to rely on the evidence of Dr McGrath. It would be churlish to deny her the chance to do so for this reason alone. 45 The Council did not submit in terms that it was or might be prejudiced if the Court were to consider Dr McGrath's evidence in Dr Barton's case in chief. But it did submit that, if the evidence was considered relevant, then it had "lost an opportunity to seek to adduce its own evidence in response". For this reason I contemplated making an order under s 136 of the Evidence Act to limit the use to which the evidence could be put to the case in reply. The Council did not seek such an order, nor did it invite Dr Barton to consent to one. Indeed, the Council actively resisted it, arguing that it might give rise to inconsistent findings. In a judge alone trial that outcome is unlikely. Having given the matter some consideration, however, while I am satisfied that using the evidence to support Dr Barton's case in chief might prejudice the Council because the late service of it has denied it the opportunity of calling evidence to rebut it, I am not satisfied that the prejudice is sufficient to engage the discretion. In the absence of any suggestion that using the evidence to support the case in chief might be misleading or confusing, s 136 only allows the Court to limit the use to be made of the evidence if there is a danger that a particular use of it might be unfairly prejudicial to a party. In this case, no submission was advanced to support the proposition that there was a possibility of "unfair prejudice". Recently in this Court Foster J observed in Addenbrooke Pty Limited v Duncan (No 5) [2014] FCA 625 at [101]: [E]vidence is not unfairly prejudicial to a party merely because it tends to damage the case of that party or to support the case of an opponent. Unfair prejudice is prejudice which might lead the fact finder to find facts upon a false basis. 46 In its Interim Report No 26 on Evidence the Australian Law Reform Commission said at [644]: By risk of unfair prejudice is meant the danger that the fact-finder may use the evidence to make a decision on an improper, perhaps emotional, basis, ie on a basis logically unconnected with the issues in the case. Thus evidence that appeals to the fact-finder's sympathies, arouses a sense of horror, provokes an instinct to punish, or triggers other mainsprings of human action may cause the fact-finder to base his decision on something other than the established propositions in the case. Similarly, on hearing the evidence the fact-finder may be satisfied with a lower degree of probability than would otherwise be required. (Footnotes omitted.) 47 Sheller JA (with whom Meagher JA agreed) referred to these remarks in Ordukaya v Hicks [2000] NSWCA 180 at [37]. So, too, did Basten JA (with whom Barrett JA and Bergin CJ in Eq agreed) in Fulham Partners LLC v National Australia Bank Ltd [2013] NSWCA 296 at [71]. 48 None of these risks arise in the present case. 49 Here, the Council raised positive defences which Dr Barton seeks to answer with this evidence. The Council had a forensic choice. Given the similarity of some of the issues, there was every chance that expert evidence called to address the issues raised by the defence might have a logical bearing on the issues raised by Dr Barton's case in chief. 50 For these reasons it would not be unfairly prejudicial to the Council to use Dr McGrath's evidence (to the extent that it is relevant) to resolve issues arising from Dr Barton's case in chief.
Conclusion 51 The evidence of Ms Kelly should not be admitted. But Dr Barton may read the affidavit of Dr McGrath and tender her report, save for the opinion given in answer to question 8(a). I certify that the preceding fifty-one (51) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Katzmann.
Barton
Lake Macquarie City Council