HEADNOTE
[This headnote is not to be read as part of the judgment]
The appellant, Dr Sujatha Chandrasekaran, is a qualified medical practitioner and specialist psychiatrist. In July 2017, the appellant entered into an agreement with the second respondent, Charterhouse, by which Charterhouse would register the appellant's interest in providing locum services as a medical practitioner to its medical clients. In emails exchanged on 5 December 2017, a Charterhouse consultant and the appellant discussed a potential locum placement in child and adolescent psychiatry at Redbank House, with the possibility of a role in adult psychiatry becoming available. Redbank House is an inpatient facility that cares for patients who are children and adolescents, and is a unit of Westmead Hospital operated by the first respondent, Western Sydney Local Health District (the Health District). The appellant discussed the opportunity at Redbank House with Dr Ashwini Padhi, the clinical director of Redbank House, on 5 December 2017. On the same day, the appellant informed a consultant of Charterhouse that she would like to go ahead with the child and adolescent role at Redbank House with a view to transitioning to an adult role "when possible".
Draft locum agreements between Charterhouse (acting as an agent for the Health District) and the appellant were exchanged between 8 and 11 December 2017. While the title of the appellant's role in the early drafts of the locum agreement was "VMO Adult Psychiatrist", in the final version which was signed and returned by the appellant on 11 December 2017, her role title was "VMO Psychiatrist". The locum agreement provided, among other things, that the appellant was appointed as an independent contractor and that the Health District "cannot guarantee, and no warranty is made, as to the amount of work that may ultimately be required, or the total Fee that may be payable, during the Term". The term of the appointment at Redbank House was 27 December 2017 to 2 March 2018. It was common ground that by s 98 of the Health Services Act 1997 (NSW), the terms of the Public Hospitals (Visiting Medical Officers - Sessional Contracts) Determination 2014 (NSW) (the Sessional determination) were contractually binding on the appellant and the Health District. Relevantly, cl 15 of the Sessional determination provided the Health District with a right to suspend the appellant's appointment and cl 16 provided a right of termination of the locum agreement in specified circumstances.
During the appellant's placement, Dr Padhi became aware of verbal complaints about the appellant from the parents of two child patients. Those incidents were recorded in Advanced Incident Management System (AIMS) reports prepared on 16 January 2018. The Severity Assessment Code (SAC) on these AIMS reports was initially recorded as "2", which represented the second-highest category of risk to patients. Conversations with the appellant on Friday, 12 January 2018, led Dr Padhi to the view that the appellant was exhibiting symptoms consistent with paranoia as a result of which he became concerned about her employment in a position involving caring for troubled children and adolescents. On Monday, 15 January 2018, after obtaining the approval of senior management of the Health District, Dr Padhi and Ms Joseph met with the appellant and informed her that she was not allowed to continue in her role.
On or about 17 January 2017, Dr Padhi told Mr Daniel Harvey, a consultant at Charterhouse, that the appellant's placement at Redbank had been terminated. Mr Harvey passed that information to his supervisor at Charterhouse, Mr David Pereira, who instructed Mr Harvey, "[a]t this stage, Charterhouse shouldn't arrange further placements for Dr Chandrasekaran" (the Pereira statement).
On 18 January 2018, based on the advice of a member of the Health District's clinical governance team, Ms Joseph updated the AIMS reports in respect of the two patients by downgrading the SAC for each of the reports from "2" to "4", "4" being the lowest level of risk to patients. Also on 18 January 2018, Ms Joseph prepared a risk assessment pertaining to the appellant and a brief to the chief executive of the Health District seeking retrospective approval for the termination of the appellant's placement on 15 January 2018. The risk in relation to the appellant in the risk assessment was recorded as "extreme" but this document was left incomplete and was not signed. On 9 February 2018, Dr Padhi made a notification about the appellant to the Australian Health Practitioners Regulation Authority (AHPRA) and annexed statements of several Health District employees. AHPRA forwarded this notification to the Health Care Complaints Commission (HCCC) on the same day.
By email of 1 July 2018 to Mr Harvey, copied to Ms Greenfield, the appellant sought Charterhouse's address for service of legal proceedings. Mr Harvey intended to forward that email to Mr Pereira but inadvertently replied to the appellant and Ms Greenfield on 2 July 2018, in which he referred to the appellant as follows: "Dave, this woman is cray. This is the cray google car lady who got fired from Health District" (the Harvey statement).
On 17 July 2018, in response to a request by the HCCC, the Health District's executive director mental health service, A/Prof Kotze, sent a letter to the HCCC attaching, among other things, copies of the brief sent to the chief executive, the two AIMS reports, the risk assessment prepared by Ms Joseph, and the statements of several Health District staff. On 24 October 2018, the Medical Council suspended the appellant's registration as a medical practitioner by imposing a condition on the appellant's registration not to practice "as a psychiatrist" or "medicine", pursuant to s 150(1)(b) of the Health Practitioner Regulation National Law (NSW).
In June 2018, the appellant commenced proceedings against the Health District and Charterhouse. Against the Health District, the appellant alleged misleading or deceptive conduct in relation to the nature and location of the VMO placement, breach of contract in relation to the termination of the locum agreement, breach of confidence and injurious falsehood. Against Charterhouse, the appellant alleged misleading or deceptive conduct and injurious falsehood. The appellant claimed damages in respect of the loss of the locum agreement, past economic loss, future economic loss, out-of-pocket expenses, general damages/non-economic loss and aggravated damages. After judgment had been reserved in July 2020 the appellant applied in December 2020 to re-open her case. That application was refused in March 2021. On 29 July 2021, the primary judge rejected all claims and entered judgment for the Health District and Charterhouse: Chandrasekaran v Western Sydney Local Health District [2021] NSWSC 920. On appeal the main issues were:
whether the appellant is entitled to a retrial on the ground that the primary judge was biased in making evidentiary rulings and imposing a time limitation on cross-examination of a respondent witness;
whether the primary judge erred in refusing the re-opening application made after judgment had been reserved;
whether the primary judge erred in failing to find that the Health District and/or Charterhouse had engaged in misleading or deceptive conduct contrary to s 18 Australian Consumer Law in representing that the appellant's placement as a VMO would be at Cumberland Hospital in adult psychiatry, when in fact the placement was at Redbank House and in child and adolescent psychiatry;
whether the primary judge erred in failing to find that the termination of the locum agreement by the Health District was a breach of contract;
whether the primary judge erred in failing to find that the Health District had breached an obligation of confidence in relation to personal information of the appellant which Dr Padhi had allegedly received from third parties;
whether the primary judge erred in failing to find that the creation and circulation within the Health District of the risk assessment and the AIMS reports, and Dr Padhi's notification to AHPRA, and A/Prof Kotze's letter to the HCCC involved false statements about the appellant amounting to injurious falsehoods for which the Health District was liable; and
whether the primary judge erred in failing to find that the Harvey statement and/or the Pereira statement amounted to injurious falsehoods for which Charterhouse was liable.
The Court (Gleeson JA, Leeming and Adamson JJA agreeing) held, allowing the appeal in part in relation to the breach of contract claim but otherwise dismissing the appeal:
Bias
As to apprehended bias, the appellant did not identify what might have led the judge to decide the case other than on its legal or factual merits. The appellant failed to identify a connection between the impugned evidentiary rulings and procedural decisions and the possibility that the judge might depart from impartial decision-making in determining the issues to be decided in the proceedings. There was no basis for finding that a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial and unprejudiced mind to the resolution of the issues: [60]-[63].
Johnson v Johnson (2000) 201 CLR 488; [2000] HCA 48; Michael Wilson & Partners Ltd v Nicholls (2011) 244 CLR 427; [2011] HCA 48, applied.
As to actual bias, there was no basis for inferring that his Honour was not open to persuasion because the appellant had been unsuccessful on some evidentiary and procedural rulings made in the course of the trial and on the re-opening application: [64]-[67].
Re-opening application
The interlocutory decision to refuse the appellant's re-opening application involved the exercise of the Court's discretion. It was therefore necessary for the appellant to demonstrate a House v The King-type error. No such error was identified: [68]-[73].
Misleading and deceptive conduct claim
The appellant did not labour under an erroneous assumption as to either the nature of her role (in child and adolescent psychiatry) or the location at which she was to provide locum services (at Redbank House). The description of the appellant's role as a "VMO Psychiatrist" in the final version of the locum agreement signed on 11 December 2017 is to be understood in the context of earlier exchanges between the appellant, Charterhouse and the Health District. That context includes the contemporaneous emails in which the appellant expressed her understanding that the role was in child and adolescent psychiatry and at Redbank House: [95]-[103], [110]-[111].
ACCC v TPG Internet Pty Limited (2013) 250 CLR 640; [2013] HCA 54; Butcher v Lachlan Elder Realty Pty Limited (2004) 218 CLR 592; [2004] HCA 60 applied.
Breach of contract claim
The discretion conferred on the Health District by the locum agreement to regulate the amount of work to be performed by the appellant "during the term" of the locum agreement did not authorise the Health District to terminate the locum agreement itself. By purporting to do so, the Health District breached the locum agreement: [137]-[147].
Damages for wrongful termination are to be assessed on the basis of the least onerous method of contractual performance, absent facts to the contrary. The natural inference is that the Health District would have exercised its power under cl 15 of the Sessional determination to suspend the appellant's appointment, given Dr Padhi's concerns for patient safety and the appellant's own wellbeing, with which A/Prof Kotze agreed. The suspension of the appellant by the Health District would have had the consequence that while suspended, the appellant had no entitlement to payment of any fees under the locum agreement and, although suspension would have enlivened procedural fairness provisions under the Health Services Act, there is no basis for a finding that that procedure would have resulted in the re-appointment of the appellant before the end of the term of the locum agreement on 2 March 2018: [148]-[155].
Berry v CCL Secure Pty Ltd (2020) 271 CLR 151; [2020] HCA 27; Commonwealth v Amann Aviation Pty Ltd (1991) 174 CLR 64; [1991] HCA 54; TCN Channel 9 Pty Ltd v Hayden Enterprises Pty Ltd (1989) 16 NSWLR 130 applied.
In the absence of proof of actual damage, nor challenge to the primary judge's contingent findings on causation, no entitlement to compensatory damages has been established. The appellant is entitled to an award of nominal damages as a token of the Health District's breach of contract in the sum of $100: [156]-[158].
State of New South Wales v Stevens (2012) 82 NSWLR 106; [2012] NSWCA 415, referred to.
Breach of confidence claim
There was no evidence that third parties had shared any confidential information about the appellant with Dr Padhi. Nor was there a basis for inferring that Dr Padhi had accessed the appellant's online accounts either directly or indirectly: [172]-[187].
Injurious falsehood claim against the Health District
Proof of malice is a necessary element in a claim of injurious falsehood. Malice requires that the statement was made mala fide or with a lack of good faith; a statement made in good faith will not satisfy the requirement of malice: [188]-[192].
Palmer Bruyn & Parker Pty Ltd v Parsons (2001) 208 CLR 388; [2001] HCA 69, applied.
National Roads & Motorists' Association Ltd v Construction, Forestry, Maritime, Mining and Energy Union [2019] FCA 1491; (2019) 291 IR 28; AMI Australia Holdings Pty Ltd v Fairfax Media Publications Pty Ltd & Ors [2010] NSWSC 1395, referred to.
There was no error in the primary judge's finding that the notification given by Dr Padhi to AHPRA concerning the appellant was not motivated by malice but was done in good faith. The documents and evidence upon which the notification was based provided a well-founded basis for Dr Padhi's concerns. Similarly, the letter sent by A/Prof Kotze to the HCCC attaching the AIMS reports, risk assessment and other documents was not motivated by malice. A/Prof Kotze was responding to a request by the regulator for documents and reports in relation to the appellant. No malicious intent can be inferred from A/Prof Kotze providing documents to the HCCC in the form in which they were prepared: [214]-[223].
Injurious falsehood claim against the Health District
The Pereira statement was not a statement concerning the appellant's goods or business, nor a false statement, nor made to a third party; it was a statement as to what Charterhouse intended to do. Moreover, there was no error in the finding that the Pereira statement was not made with malice. It can be inferred it was made to protect Charterhouse's business: [231]-[234].
The Harvey statement was not made to a third party nor was the statement malicious. The fact that a person uses language that is strong or conducts themselves in a way that is upsetting to the plaintiff does not, of itself, evidence malice: [235].
Aldi Foods Pty Ltd v Transport Workers Union of Australia [2017] FCA 1004, referred to.