This judgement deals with a notice of motion filed by the respondent on 28 November 2021 seeking summary dismissal of the proceedings, a permanent stay of the proceedings, or an order striking out the applicant's claim (the "Motion").
The proceedings concern an application for relief in relation to unfair dismissal pursuant to section 84 of the Industrial Relations Act 1996 (the "IR Act"), filed on 5 October 2021 by the applicant (the "Application").
The Motion alleges that the Application discloses no cause of action and that the claims in the Application had already been the subject of a determination by Commissioner Webster on 13 September 2021 in Hans Peter Dietz v The Secretary, Ministry of Health in respect of Nepean Blue Mountains Local Health District [2021] NSWIRComm 1068 (the "Earlier Decision").
[2]
Background
On 17 June 2020, the respondent issued the applicant with a show cause letter which put the applicant on notice that the respondent was considering terminating his employment on the basis of what they described as five proven allegations:
1. the findings following an investigation into complaints by a patient;
2. findings following an investigation into the applicant's conduct at a conference:
3. the applicant's previous disciplinary history:
4. concerns about the reputation of the respondent: and
5. the loss of trust and confidence and irreparable damage to the employment relationship.
In response to the Show Cause Letter, the applicant filed an application for relief in relation to unfair dismissal in the New South Wales Industrial Relations Commission on 1 July 2020 ("Earlier Application").
The Earlier Application was not resolved at conciliation and directions were made for the filing and serving of materials and the matter was listed for hearing.
The hearing took place over 3 days on 21 and 22 December 2020 and 12 February 2021. There were six witnesses who gave evidence and were cross examined. At the conclusion of the hearing, some closing oral submissions were made by the parties which were then supplemented by further written submissions which were filed and served following the hearing.
Further written submissions were provided by the parties following the hearing and following this Commissioner Webster handed down the Earlier Decision.
In the Earlier Decision at [4] the Commissioner identified the relief sought as follows:
4 The applicant seeks an order from the Commission under s 89(7) of the Act that the respondent is not permitted to dismiss him from his employment.
At paragraphs [133]-[136] Commissioner Webster concludes and makes the following findings, order and recommendation:
133 I have considered very closely the impact any decision to terminate the applicant may have upon him, those within his team and the many patients who he would otherwise assist through the public health system. I am of the view that there is a proper basis to conclude that the necessary elements of trust and confidence in the relationship have been considerably damaged. Accordingly, I have decided not to exercise my discretion to make an order restraining the respondent from terminating the applicant on the basis of:
(1) The applicant's previous disciplinary history, including the unreasonable refusal of the applicant to accept identified interpersonal shortcomings and complete remedial actions;
(2) Concern about the reputation of the NBMLHD, the applicant's response to these matters in the proceedings and that patients and staff will continue to experience similar interactions with the application that have occurred previously; and
(3) The loss of trust and confidence in the applicant and the irreparable damage to the employment relationship caused by the applicant not being willing to accept his behaviours contribute to complaints about him and his unwillingness to complete the required training.
134 However, I have also concluded that it may be that the parties are able to work through these matters with the benefit of this decision and the passage of time that has elapsed since the applicant was initially stood down. Accordingly, I have decided to make a recommendation the parties participate in formal mediation with a view of establishing whether the relationship can be restored effectively. The respondent should now proceed to conclude the disciplinary process in view of this decision.
Orders
135 I make the following order:
(1) The respondent is restrained from terminating the applicant on the basis of the allegations of misconduct made against him by Patient A and his conduct at the 'Natural birth: What women need to know' in Newcastle run by a law firm, Catherine Henry Lawyers in November 2017.
136 I make the following recommendation:
(1) The parties confer with a view of arranging a mediation with the aim of exploring whether the employment relationship can be restored effectively.
The day after the Initial Decision was handed down the respondent informed the applicant that his employment was being terminated on that day. The basis for the termination were those grounds that Commissioner Webster decided not to exercise her discretion to make an order restraining the respondent from terminating the applicant on (the "Dismissal Reasons").
On 5 October 2021, the Current Application was filed.
The Current Application was the subject of two unsuccessful conciliations before Chief Commissioner Constant on 3 and 11 November 2021.
Following the second conciliation, directions were made for the hearing of the jurisdictional objection and in accordance with the directions, the parties filed materials and the Motion was heard on 26 April 2022.
At the hearing, both parties relied upon written submissions and supplemented these with oral submissions. Additionally, the respondent tendered, without objection, an affidavit of Darren David Gardner as well as an exhibit to that affidavit. This affidavit and the exhibit contained all of the materials in relation to the hearing and proceedings before Commissioner Webster.
Following the hearing, the parties were requested to provide further submissions as to whether the orders made in the Earlier Decision were final or interlocutory and the parties attention was drawn to the line of authority emanating from the case of Hill v Director-General, Department of Education and Training [1998] NSWIRComm 622; (1998) 85 IR 201 ("Hill").
Further submissions were filed in response to the request on 18 July 2022 by the respondent and on 26 July 2022 by the applicant.
[3]
Respondent
The grounds relied upon in support of the Motion is that the respondent was entitled to the complete defence of res judicata and further or in the alternative, issue estoppel. They further relied on the alternative submission that the Application constituted an abuse of process.
In relation to each ground, the respondent made the following submissions as to the manner in which each should be approached:
12. Where the plea of res judicata is raised, the primary question will be whether the cause of action in the later proceedings is the same as that which was litigated in the former proceedings.5 This is determined by matters of substance, rather than the technical identity of the forms of action.6 The material relevant for the determination of that question are the pleadings and the actual record in the former proceedings.
13. Where the plea is of issue estoppel, the question will be whether an issue of fact or law which is raised in the later proceedings was an issue of fact or law which was also raised in the earlier proceedings and therein determined. 7 In determining that question, any material may be looked at which will show what issues were raised and decided. In that respect, this is broader than the consideration for res judicata. For issue estoppel, the Commission may have regard to the pleadings, the evidence, and the reasons given for judgment.8
14. Even where res judicata or issue estoppel are not made out, proceedings may nonetheless be an abuse of process warranting summary dismissal. In Poulos v Commonwealth Bank of Australia (2019] NSWCA 241, the Court stated (footnotes omitted):
(49) An attempt to relitigate an issue resolved in earlier proceedings in a court of competent jurisdiction may, depending on the facts, involve an abuse of process, even in the absence of an estoppel or res judicata. In Reichel v Magrath, Lord Halsbury LC put this on the basis that "It would be a scandal to the administration of justice if, the same question having been disposed of by one case, the litigant were to be permitted by changing the form of the proceedings to set up the same case again". In Walton v Gardiner, Mason CJ, Deane and Dawson JJ said that proceedings should be stayed as an abuse of process "if, notwithstanding that the circumstances do not give rise to an estoppel, their continuance would be unjustifiably vexatious and oppressive for the reason that it is sought to litigate anew a case which has already been disposed of by earlier proceedings". In Arthur JS Hall & Co v Simons, Lord Hoffman identified the policies that underlie the doctrine as being, first, that a defendant should not be troubled twice for the same reason, and secondly, that there is "a general public interest in the same issue not being litigated over again".
5 Jackson v Goldsmith (1950) 81 CLR 446 per Fullagar J.
6 Effem Foods at 418-419.
7 Kuligowski v Metrobus (2004) 220 CLR 363.
8 Jackson v Goldsmith (1950) 81 CLR 446.
In oral submissions, the respondent further put that the Commission is restricted to only considering the pleadings and the formal order(s) in determining cause of action estoppel (res judicata). On this point, the respondent submitted that an unfair dismissal application constitutes strict pleadings for the purpose of determining cause of action estoppel.
The respondent submitted that Commissioner Webster, in the Earlier Decision, was required by the scheme of the Act to determine if would be harsh, unreasonable or unjust to dismiss the applicant on any of the five grounds in the 17 June 2020 show cause letter.
The respondent then went on to submit that as the applicant had not been successful with respect to the Dismissal Grounds, Commissioner Webster determined that to dismiss the applicant on any of these grounds would not be harsh, unreasonable or unjust. They further submitted that, by reference to s 173 of the Act, the decision was final.
In concluding, the respondent submitted that as the applicant was dismissed for the Dismissal Grounds that Commissioner Webster had determined in the Earlier Decision:
1. the applicant has no cause of action as it has already been finally determined and the application should be struck out (res judicata/cause of action estoppel);
2. the matters raised in these proceedings, have already been determined against the applicant in the Earlier Decision and should be estopped from raising these issues again (issue estoppel); and/or
3. these proceedings raise the same issues as the question that was determined in the Earlier Proceedings and the Applicant should not be permitted to simply change the form of the proceedings to set up the same case again (abuse of process).
With one exception, the applicant agreed with the respondent's submissions regarding the proper approach to be taken in relation to each of the grounds relied upon by the respondent in the Motion. This exception was that the applicant did not agree with the respondent's contention that the commission was limited to considering the pleadings and final orders in relation to cause of action estoppel.
The applicant submitted that the Motion should be dismissed for two reasons:
1. the Earlier Decision was not final in relation to the matters to be decided in these proceedings; and
2. the issue decided by Commissioner Webster in the Earlier Decision is not identical to the one to be decided in the current proceedings.
As to the first issue of finality, it was put by the applicant that when one has regard to the decision being one not to exercise the discretion to restrain termination and then coupled with the recommendation to participate in mediation it cannot be taken that there was a complete and effective adjudication of the matters the subject of this proceeding.
The applicant also pointed towards 4 indicia which support the conclusion that the earlier decision did not finally determine that it was open for the respondent to terminate the applicant's employment as follows:
1. other aspects of the earlier decision confirmed that the outcome of the decision was not one which permitted the respondent from dismissing the applicant, such as the recommendation to mediate;
2. Commissioner Webster did not make a recommendation sought by the respondent in the following terms:
The applicant does not have sufficient grounds to challenge any actual dismissal if the Respondent decides to proceed with dismissal for the reasons notified to the Applicant and as considered in these proceedings.
1. There was no finding by Commissioner Webster that the loss of trust and confidence in the employment relationship was sufficient to justify termination; and
2. a refusal to make an order in the exercise of discretion is not a final decision, relying upon the case of Coles v Wood [1981] 1 NSWLR 723.
With respect to the submission that the issue to be decided was not identical to that decided in the Earlier Proceeding, the applicant sought to rely on the decision of Commissioner Newall in Smith v Secretary of the Treasury [2018] NSWIRComm 1012. ("Smith").
In Smith, the applicant submitted that Commissioner Newall recognised that there may be differences between an application in relation to a threatened dismissal and one in relation to an actual dismissal. The applicant put that this was such a case, in that Commissioner Webster determined whether she should exercise the discretion to restrain the respondent from terminating the applicant rather than whether it was harsh, unreasonable or unjust to terminate the applicant on any of the grounds the show cause letter.
In oral submissions, counsel for the applicant provided the following submission which conveniently summarises the applicant's case:
The respondent, and indeed this seems to be the entirety of the respondent's case, the respondent seeks to characterise the Commission's reasons as a final determination that it would not be harsh, unreasonable or unjust to terminate the applicant's employment on the basis of reasons 3 to 5. That, in my submission, is a misreading of the Commission's decision. The Commission did not intend to make any finding on a final basis as to whether or not the termination of the applicant's employment would be harsh, unjust or unreasonable. And indeed, to impute such an intention would be entirely inconsistent with the recommendation that the parties participate in mediation.
In the particular circumstances of this case, the fact that no order was made restraining the respondent from terminating the applicant's employment on the basis of reasons 3 to 5 is not the same as a finding that it would be harsh, unreasonable or unjust to terminate the applicant's employment for those reasons.
COMMISSIONER: You mean it would not be harsh?
WHERRETT: It would not be harsh, yes, Commissioner. The respondent seeks to draw a bright line as well between reasons 1 and 2 on the one hand and reasons 3 to 5 on the other. And indeed, my learned friend said in oral submissions today that each ground has been dealt with separately by the Commission. That, in my submission, is also a misreading of the Commission's decision. To read the decision in that way would be to overlook the fact that there are clear links between patient A's allegation and the conduct allegation and the concern about the respondent's reputation and the loss of trust in the applicant on the other.
In relation to the further question posed by the Commission as to the status of the earlier decision, both parties accepted that it was a final decision rather than interlocutory. However, the applicant further submitted that although that decision was final for the purpose of the issue which it was required to determine, it was not final for the issues to be determined in these proceedings.
[4]
Issues
Considering the submissions of both parties and the authorities, it is apparent that the following two issues are key to determining the Motion, whether it be on the grounds of either form of estoppel or abuse of process:
1. did the Earlier Decision determine the issue required to be determined in these proceedings?;
and if the answer to this is yes, then
1. did such determination have the requisite level of finality?
If the answer to both is yes, then the Motion must be successful and the Application must be dismissed. Alternatively, if the answer to either is no, then the Motion must be dismissed and the Application be programmed for hearing.
In determining both issues, I reject the respondent's submission that the Commission is limited to considering the pleadings and the final orders as there is ample authority that the Commission is not a jurisdiction of strict pleadings (e.g. McGinn v Secretary, Family and Community Services [2017] NSWIRComm 1039).
Thus, it is appropriate that consideration is given to the totality of the Earlier Decision and the materials put before Commissioner Webster as well as the statutory scheme.
[5]
Identical Issue
Both this application and the Earlier Application were brought pursuant to section 84 of the IR Act and as such, both ultimately require the determination of whether the dismissal/threatened dismissal of the applicant was/would be harsh, unjust and/or unreasonable (Burge v NSW BHP steel Pty Ltd [2001] NSWIRComm 117). Then ss s 87(1) of the IR Act then requires the Commission to either make one of the orders available under s 89, dismiss the application or make any other order the Commission can make.
Turning to the Earlier Decision, Commissioner Webster provides a background to the Earlier Application and then sets out the law relevant to her consideration and summarises what that approach will be as follows:
42 Neither party directed the Commission to any caselaw relating to the Commission's discretion to make an order pursuant to s 89(7) of the Act. I consider the jurisprudence of the Commission as it relates to applications of dismissals to be directly applicable to applications relating to threatened dismissals. Given the Commission is required to consider whether the threat of dismissal is harsh, unreasonable or unjust, it will be important in such matters to first establish that there has been a threat of dismissal. If a threat of dismissal has been identified, it will be necessary to examine the reasons provided by the employer for the threat, whether those reasons have a basis in fact and whether a fair process has been adopted prior to the threat of dismissal being made: s 88. Matters of proportionality and harshness will also be relevant to consideration of threatened dismissal proceedings, as it is in any Unfair Dismissal matters where the employment has been terminated.
The Commissioner clearly sets out that the process she was undertaking in the Earlier Decision was to determine whether the threat to dismiss the applicant was harsh, unjust and/or unreasonable. This included considering each of the reasons, procedural fairness issues, harshness and proportionality.
Given ss 87(1) of the Act, Commissioner Webster found that to dismiss the applicant in accordance with the threat would be harsh etc, then the Commissioner was required to make an order under section 89 or any other order available. Conversely, if the ground was not harsh etc, then no order is to be made and the application should be dismissed.
After dealing with each of the five various grounds, the Commissioner determined not to make any order in relation to the Dismissal Grounds, although she did made a recommendation.
A recommendation, by its' very nature, is non-binding and is not an order, thus it is not an outcome which falls within one of the outcomes contained in ss 87(1).
Although not expressly stated, the Commissioner, by deciding not to make an order in relation to the Dismissal Reasons had obviously determined that to dismiss the applicant on the basis of these would not be harsh, unjust and/or unreasonable. Had the Commissioner intended that the respondent could not dismiss the applicant for the reasons of the Dismissal Grounds, then she would have been obliged and would have made an order to this effect.
As to the case of Smith relied upon by the applicant, the learned Commissioner's findings do not stand for the authority sought to be given to it by the applicant. Commissioner Newell in that case was dealing with the issue of whether there was a power to reinstate an employee on an interim basis. As part of his reasoning, the Commissioner refers to the implied power determined by Schmidt J in the case of Hill under ss 89(7) of the IR Act to make an order to restrain an employer from dismissing an employee on an interim basis. The Commissioner then finds that there is no such implied power to make an interim reinstatement order. It is in this context that he makes the observation:
"once an employee has been dismissed, whether or not he earlier claimed that a threatened dismissal existed, the rights which he has to pursue for remedies under the Act are untrammelled"
It is also important to note that Commissioner Newell in Smith, limits his observations as to the rights of a dismissed employee's rights under the Act in circumstances there has been an application in which an employee have "claimed" that there is a threatened unfair dismissal rather than an application for threatened unfair dismissal which has had been determined.
Determination of the issue required in this application would require the Commission to determine the same issue that Commissioner Webster did in the Earlier Decision i.e. the dismissal of the application on the basis of the Dismissal Grounds harsh, unjust and/or unreasonable.
[6]
Finality
The applicant's submissions on the issue of finality rely heavily on the recommendation for mediation made by the learned Commissioner in the Earlier Decision.
That the Commissioner in the Earlier Decision made a recommendation which is not binding on the parties does not detract from the conclusion that she must have determined that dismissing the applicant on the basis of the Dismissal Grounds would not be harsh, unjust or unreasonable. The recommendation can be seen as an attempt by the Commissioner to dissuade the respondent to take a path other than dismissing the applicant.
The failure to make the recommendations sought by the respondent also does not change the nature of the exercise undertaken by the Commissioner.
The applicant's submission concerning the Commissioner's failure to exercise a discretion meant that the decision was not final may have some force if that was a proper characterisation of what the Commissioner had done in the Earlier Decision.
The Commissioner in the Earlier Decision referred to the decision not to make the orders pursuant to ss 89(7) as an exercise of discretion, but such a characterisation is not correct. The learned Commissioner was required by ss 87(1) to make an order if she found that the Dismissal Grounds were harsh etc and alternatively make no order if she did not. It is not the case that the Commissioner could have found that, on the basis of the Dismissal Grounds, a dismissal would be harsh etc and not make an order, this is not a permissible option open to the Commission.
Finally, the nature of the decision made by Commissioner Webster does not mean it is not final as the relief sought and partly granted was a restraint from dismissing on certain grounds and not others under ss 89(7). The availability of the remedy was predicated on the existence, or otherwise, of a finding by the Commission as to unfairness.
The Earlier Decision had the requisite level of finality of the issues sought to be agitated in this application.
[7]
Conclusion & Orders
As the answer to both issues 1 and 2 above is yes, the Motion is successful.
I order that the notice of motion filed 28 November 2021 is upheld and the application filed on 5 October 2021 is dismissed and the Application filed on 21 October 2021 is dismissed.
Daniel O'Sullivan
COMMISSIONER
[8]
Amendments
30 November 2022 - Correction to Counsel name in Cover Sheet to Diana Tang.
Correction to Solicitor name in Cover Sheet and Paragraph [15] to Darren Gardner.
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 30 November 2022
Parties
Applicant/Plaintiff:
Dietz
Respondent/Defendant:
Health Secretary in respect of Nepean Blue Mountains Local Health District