Joseph Kazimierz Winsen v The University of Newcastle

APPLICANT: Mr R S Warren of counsel SOLICITORS: Braye Cragg Solicitors

LEGAL REPRESENTATIVES: RESPONDENT: Mr J Fernon SC SOLICITORS: Freehills

JUDGMENT: - 1 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: Staunton J DATE: 24/2/2005

Matter No IRC 8589 of 2001 Joseph Kazimierz Winsen v The University of Newcastle Application for relief pursuant to section 106 of the Industrial Relations Act 1996 JUDGMENT [2004] NSWIRComm 401

1 The applicant commenced employment as Professor of Commerce with the respondent on or about 14 July 1977 at the age of thirty one. He is still so employed. At the time of his appointment he elected to join the University of Newcastle Staff Superannuation Scheme (UNSSS).

2 At the time of joining UNSSS in 1977, the applicant contributed five per cent of his salary to the Scheme and the respondent contributed an amount equal to ten per cent of his salary as from the date of joining the Scheme (that was 14 July 1977). That level of contribution by the applicant and the respondent continued, subject to periods of leave without pay, until July 1999.

3 In June 1999, Professor Winsen exercised what he believed was an option available to him pursuant to the terms of the UNSSS Trust Deed. That is, he elected to increase his contributions to UNSSS to ten per cent. As understood by the applicant and accepted by the respondent at that time, that election triggered a requirement for the respondent, as his employer, to increase its contributions to the Scheme to twenty per cent, giving a total contribution to the Scheme on Professor Winsen's behalf of thirty per cent.

4 In March 2001, following legal advice received by the Trustee of UNSSS from Mallesons Stephen Jaques (Mallesons), Solicitors, the respondent advised Professor Winsen that the twenty per cent contribution being made by it to UNSSS on his behalf was being made based on a mistaken construction as to the relevant clause of the Trust Deed. At that time, a copy of the legal advice received by the respondent from the Trustee was provided to Professor Winsen. The effect of that advice was that the respondent was only required to contribute ten per cent to the Scheme on Professor Winsen's behalf which, together with Professor Winsen's contribution of ten per cent, gave a total contribution to the Scheme on the applicant's behalf of twenty per cent.

5 In meeting with Professor Winsen in March 2001, representatives of the respondent advised him it did not intend to recover any of the excess contributions paid on his behalf to the Scheme but did intend to reduce its contributions to ten per cent in accordance with the relevant Trust Deed provisions. As events transpired and despite the applicant's requests and protestations to the contrary, that reduction took effect on 8 June 2001. It should be said that reference to the applicant's 'requests and protestations' refers to matters raised by Professor Winsen as to reasons why the respondent should not unilaterally vary its prior agreement to contribute twenty per cent to UNSSS on his behalf. Those matters will be detailed further in this judgment.

6 As a consequence of the respondent's action, the applicant contends that his contract of employment with the respondent has become harsh, unjust and unconscionable and contrary to the public interest in that it has permitted the respondent to unilaterally change the terms of the contract to enable it to reduce its superannuation contribution on behalf of the applicant from twenty per cent to ten per cent of his annual salary. 7 In addition to a declaration as to the overall unfairness that the respondent's action creates, and the usual orders as to costs and interest, the applicant seeks relief in the following terms: [1] An order varying in whole or in part and either ab initio or from some other time the contract of employment between the applicant and the respondent whereby the applicant was employed and performed work for the respondent in the position of Professor of Commerce, except to the extent that the applicant receive remuneration and benefits from the respondent or became entitled to receive such remuneration or benefits. ... ... [3] An order that the contract be varied from its commencement to include the term that should the applicant make a contribution of 10% of his salary to the University of Newcastle Staff Superannuation Scheme, or any superannuation scheme which replaces that scheme, then the respondent will contribute 20% of the applicant's salary to the same superannuation scheme, and shall continue to contribute such 20% of the applicant's salary to the said superannuation scheme for as long as the applicant continues to contribute 10% of his salary to the said superannuation scheme.

8 In support of the application for relief, in addition to the evidence of the applicant, evidence was given by Mr Russell Skelton. Mr Skelton is the Manager, Marketing and Trading with Macquarie Generation (Macquarie). Professor Winsen was employed by Macquarie between 1 July 1997 and 19 March 1999 on a full-time basis and then on a part-time basis until September 2000. The circumstances of that employment and his subsequent return to employment with the respondent are relevant considerations in these proceedings and will be later detailed.

9 On behalf of the respondent, the following affidavit evidence was tendered without objection: (i) Mr Brian Penfold. Mr Penfold had been employed by the respondent for nearly 34 years from March 1968 until December 2001. From December 1990 until his retirement in December 2001, and while he held the roles of Bursar, then Director of Finance and Estates and Executive Director, Finance and Property, Mr Penfold was responsible for the financial administration of the University's superannuation obligations. Concurrently with the roles of Bursar, Director of Finance and Estates and Executive Director, Finance and Property, Mr Penfold also held the position of Public Officer of the University from about 1990 to 2001. In that position, he was responsible for all taxation matters relating to the University. (ii) Ms Susan Beach. Ms Beach has been employed by the respondent since 1993. Since 2000, she has been the Director, Vice-Chancellor's Division and Legal Unit. In that position, Ms Beach is responsible for the provision of legal advice to the Vice-Chancellor on a range of University matters. (iii) Ms Robyn Minslow. Ms Minslow has held the position of Superannuation Officer with the respondent since 1997, having been employed by the respondent since 1985. In that position, she is responsible for the day to day administration of superannuation arrangements for employees of the respondent.

10 None of the respondent's witnesses were required for cross examination.

Is the Superannuation Trust Deed part of the contract of employment?

11 Counsel for the respondent has raised this issue as going to the Court's jurisdiction to consider the applicant's claim.

12 The respondent relies on two propositions. The first, it was submitted, is Professor Winsen's membership of UNSSS was entirely optional in that he was able to choose between two superannuation schemes or none at all. As counsel for the respondent submitted, Professor Winsen could have chosen not to join any scheme. Accordingly, it was said, Professor Winsen's membership of UNSSS was not part of the contract of employment. Secondly, even if there was an obligation to join under the contract of employment then, it was submitted, any rights and obligations that arise, arise under the Trust Deed, not the contract of employment.

13 While I find such an outcome highly unlikely within the overall context of employment related conditions, it is possible that Professor Winsen could have, by dint of oversight or deliberate decision, chosen not to join one of the two superannuation schemes available at the time of his appointment. The letter of offer of appointment to Professor Winsen of 10 September 1976 stated, inter alia: I enclose for your information a copy of Professional Appointments - General Conditions of Appointment. I have forwarded a copy of the Trust Deed of the Staff Superannuation Scheme under separate cover.

14 In a letter to him from the respondent dated 22 October 1976, Professor Winsen was advised as follows: Further to the Vice-Chancellor's letter of 19th October, I enclose for your information a copy of the Trust Deed of the Staff Superannuation Scheme for this University and a booklet of the New South Wales State Superannuation Fund together with a document of the Comparison of Superannuation Schemes available to new appointees to the academic staff and would be grateful if you could let me know your choice of Schemes. If your decision is to apply for membership of the Staff Superannuation Scheme, the question of assignment of current superannuation arrangements into our Scheme may arise. Our experiences are that assignments of superannuation from overseas countries can be very complicated and indeed in some cases impossible and the latter may be most likely in view of your present superannuation arrangements being in Canada. In this event you may find it necessary to convert your current superannuation arrangements into cash, and re-commence superannuation within our Scheme.

I look forward to receiving your decision in due course.

15 Clearly, as part of his contract of employment Professor Winsen had decisions to make - whether to join a fund and if so, which one. At the appropriate time, as part of taking up his appointment with the respondent, he chose UNSSS and made application to join. Professor Winsen commenced employment with the respondent on 14 July 1977. By letter of 5 August 1977, the respondent advised him that 'the Vice-Chancellor has approved your application for membership of the University of Newcastle Staff Superannuation Scheme effective from 14 July 1977'.

16 From that time to the present, both Professor Winsen and the respondent have contributed to the Scheme on Professor Winsen's behalf.

17 Having regard to the above history detailing the background to Professor Winsen's membership of UNSSS, I accept the decision to join UNSSS (or the other scheme) was voluntary. However, once the decision was taken by Professor Winsen, agreed to and approved by the respondent, the provisions and practical effect of the Trust Deed became part of the contract of employment. That is so, it seems to me, by reference in the first instance to the definition of contract in s105 of the Industrial Relations Act 1996 (the Act) as well as the provisions of s106(1) of the Act.

18 There was no evidence before me as to what constituted the Professional Appointments - General Conditions of Appointment referred to in the respondent's letter to Professor Winsen of 10 September 1976. Whether reference was made in that document to superannuation is therefore not conclusively known. I would be entirely surprised if it had not been.

19 The letter of offer of employment made by the respondent in 1977 enclosed a copy of the conditions of that employment including, as part of that, reference to the Trust Deed of the respondent's Staff Superannuation Scheme. The relevant extract is contained in para [13] above. In considering that passage in its entirety, the inference is compelling that, once the decision to join was made and accepted, superannuation was a contractual condition of employment.

20 That superannuation was considered integral to the employment contract was referred to by Mr Penfold as follows: [10] Upon the University's independent establishment in 1965, there was a period of considerable expansion as the University commenced the process of opening new academic departments. To my recollection the University sought high profile, high calibre and experienced academic staff to lead those departments. Between 1965 and approximately 1980, the University at times found it difficult to attract sufficiently high profile, high calibre and experienced academic staff. I understood, from my experience in senior positions roles in the Bursar's Division, that this was because the University was a young institution. ......

[30] I understand that the purpose of providing an increased superannuation contribution under clause 15.1, which was formerly clause 25 of the Principal Deed, was to attract high profile, high calibre, experienced academic staff to what was then a young university. I am aware of this due to my understanding of the operation of the University's staffing requirements plus my understanding of superannuation schemes specific to universities generally, gained in my senior roles in the Bursar's Division and the Finance and Property Divisions since 1974.

21 I have no difficulty in concluding that the contractual context on which it (superannuation) was proffered by the respondent at the time of appointment together with the subsequent decision made by Professor Winsen and accepted by the respondent ensured that the terms and conditions arising under the Trust Deed became a related condition to the contract of employment.

22 In the application filed, the applicant does not challenge the construction of the Trust Deed nor does he request an order seeking any variation to the Trust Deed as contemplated in Gosper and ors v Sawyer and anor: Re Industrial Relations Commission of NSW and ors; ex parte Gosper [1984-1985] 160 CLR 548.

23 Given that background, I have no difficulty in concluding that the operation of the UNSSS Trust Deed arises directly from, and directly envisages, the performance of work in an industry in order to give it efficacy. In Solution 6 Holdings Limited and ors v Industrial Relations Commission and ors [2004] NSWCA 200 it was held: Where a contract directly envisages performance of work and has a recognisable impact on the conditions of that work the Court will readily conclude that the requisite direct connection to the performance of work exists. [57], [58]: Ex parte VG Haulage Services Pty Limited; Re Industrial Commission of New South Wales [1972] 2 NSWLR 81 applied, Mitchforce Pty Ltd v Industrial Relations Commission of NSW (2003) 57 NSWLR 212 referred to.

24 For the Trust Deed of a superannuation scheme to be relevantly operative, a member of that scheme has to perform work in an industry. In other words, it is the performance of work that triggers the provisions of the Trust Deed. Membership of a superannuation scheme is limited to persons in employment. Further, on the part of the employer, the performance of work creates the basis for payment into the scheme as consideration for services provided. In turn, it is only when such payment arises that the necessary monetary contributions to the scheme are able to be calculated and paid into the scheme fund. In short, a superannuation scheme given effect by an accompanying Trust Deed does not exist in a vacuum divorced from the necessary performance of work required to give it effect and purpose. To express it another way, the trust deed underpinning a superannuation scheme has no independent raison d'etre other than one that directly envisages the performance of work and is one that has a recognisable impact on the conditions of that work.

25 Accordingly, I am satisfied, to the extent that the terms of the Trust Deed governing the operation of the UNSSS are relevant to the application before me, they are directly related to the applicant's contract of employment and are within jurisdiction.

26 After the hearing before me had been concluded and before I delivered judgment, the respondent's counsel sought leave to make further written submissions consequent on the judgment of the Court of Appeal in Sydney Water Corporation v Industrial Relations Commission of New South Wales [2004] NSWCA 436 handed down on December 1 last. I granted that leave with leave to the applicant to respond accordingly.

27 I have now considered those additional submissions received. In his additional submissions counsel for the respondent highlighted that in Sydney Water Corporation the Court of Appeal unanimously held that the Commission's decision in Reich v Client Service Professionals (2000) 49 NSWLR 551was wrongly decided, rejecting the proposition that the Commission may find unfairness in cases that are based on no more than conduct in breach of contract.

28 The respondent submits that the applicant's assertions as to unfairness do no more than rely upon conduct that is said to be in breach of contract. Accordingly, it was submitted, this does not provide any proper jurisdictional basis for a finding of unfairness pursuant to s106 of the Act.

29 I do not see the decision of the Court of Appeal in Sydney Water Corporation as having any relevant bearing on the finding I have made as to the Court's jurisdiction in this matter. To the extent that the Court of Appeal unanimously held that the Commission's decision in Reich was wrongly decided, it (the decision in Reich) is not and was not relied upon by the applicant in support of the claim he makes before the Court. As was submitted, inter alia, on behalf of the applicant: (i) The principal order sought by the applicant is for an order varying his contract of employment with the respondent to include a term with respect to contributions to be made by the respondent to a superannuation fund on behalf of the applicant (Claim 3). (ii) In paragraphs 23, 24 and 25 of the application, the applicant contends that the contract of employment either was unfair or became unfair as a result of the conduct of the respondent. Indeed, the application itself (Claim 2) seeks a declaration from the Commission In Court Session that the contract itself is unfair, harsh and unconscionable. Such a finding, which is sought by the applicant, is a necessary pre-condition to the Commission being seized with power to vary the contract in the terms sought. Such an application is entirely consistent with the judgment of Mason P in Sydney Water Corporation Ltd .

The UNSSS Trust Deed 30 In order to properly understand the basis for the applicant's claim of unfairness and how it arises, it is necessary to start by detailing relevant provisions of the UNSSS Trust Deed.

31 From 1951 to 1965, the respondent operated as a geographically distinct campus of the University of New South Wales. In 1965 it was established as an independent university governed by the University of Newcastle Act 1964 (NSW). That Act was later replaced by the University of Newcastle Act 1989 (NSW).

32 It is not disputed that UNSSS was a superannuation scheme established by the respondent by Trust Deed (the Principal Deed) of 1 July 1974.

33 As Mr Penfold explained on behalf of the respondent: [21] UNSSS was an accumulation scheme which consisted of two components. The first component was an accumulation fund. Contributions from members and the University were deposited into a member's accumulation account which was invested under the direction of the UNSSS' trustees. Upon retirement, UNSSS members were generally entitled to receive, as a lump sum payment, the balance in their accumulation account. [22] The second component was a pension entitlement of up to 25% of the member's salary, subject to age and service requirements. Pensions were funded by the University.

34 On 23 December 1988, the Principal Deed was amended and replaced by an amending deed (the Amending Deed). Between the two Deeds, there were a number of changes made. One of them was that Clause 25 of the Principal Deed became Clause 15 of the Amending Deed. As well, there were changes made between those two clauses that bear directly on the issue before me. For that reason, Clause 25 of the Principal Deed and Clause 15 of the Amending Deed require comparative consideration. They are as follows:

A. Clause 25: Principal Deed [1] As an alternative to the assurance provisions hereinbefore provided which are based on five per cent (5%) of the member's salary together with ten per cent (10%) of that salary provided by the University, the amount of assurance shall if an officer appointed to the University after having attained the age of 40 years so elects, be the amount obtainable on payment of a total premium as follows: (emphasis added) Age Next Birthday Premium Payable by Member Premium Payable by University Total Premium (Column 1) (Column 2) (Column 3) (Column 4) 41 5-1/2% of salary 11% of salary 16-1/2% of salary 42 6% 12% 18% 43 6-1/2% 13% 19-1/2% 44 7% 14% 21% 45 7-3/4% 15-1/2% 23-1/4% 46 8-1/2% 17% 25-1/2% 47 9-1/4% 18-1/2% 27-3/4% 48 or more 10% 20% 30%

and references in clauses 10, 11 and 13 hereof to five per cent (5%), ten per cent (10%) and fifteen per cent (15%) of salary or total salary respectively shall be read and construed in the case of a person electing as aforesaid as a reference to the percentage in column 2, column 3 or column 4 of the foregoing columns as the case may be appropriate to the age of the member at the date he commenced to accrue a salary entitlement with the University. ... ... [4] The preceding clauses of this Deed shall, except insofar as sub clauses (1) and (5) of this clause otherwise provide, apply in relation to a member who has made the election herein referred to. [5] Any reference in the preceding clause of this Deed to a percentage in clauses 10, 11 and 13 hereof shall, in the case of a member who has made the election herein referred to, be read and construed as a reference to that percentage as amended by sub-clause (1) of this clause.

[6] The election herein referred to shall be made within 6 weeks from the date on which the member of staff commenced to accrue a salary entitlement with the University.

B. Clause 15: Amending Deed 15.1 As an alternative to the contributions hereinbefore provided for which are five per cent (5%) of the member's salary together with ten per cent (10%) of that salary provided by the University, the amount of contributions shall if an officer appointed to the University [ , ] after having attained the age of 40 years so elects, be the amount set out as follows :

Age Next Birthday Contribution Payable by Member Contribution Payable by University Total Contribution (Column 1) (Column 2) (Column 3) (Column 4) 41 5-1/2% of salary 11% of salary 16-1/2% of salary 42 6% 12% 18% 43 6-1/2% 13% 19-1/2% 44 7% 14% 21% 45 7-3/4% 15-1/2% 23-1/4% 46 8-1/2% 17% 25-1/2% 47 9-1/4% 18-1/2% 27-3/4% 48 or more 10% 20% 30%

and references in Clauses 11, 12 and 14 hereof to five per cent (5%), ten per cent (10%) and fifteen per cent (15%) of salary or total salary respectively shall be read and construed in the case of a person electing as aforesaid as a reference to the percentage in column 2, column 3 or column 4 of the foregoing columns as the case may be appropriate to the age of the member at the date he commenced to accrue a salary entitlement with the University. 15.2 A member may at any age contribute at a rate greater than that provided for in Clauses 11 and 15.1 provided that such rate is not greater than 20% of salary. Such additional member contributions will not attract additional University contributions. 15.3 With effect from 1 January 1986, a member may continue to make contributions after age 60 (or 65 as the case may be), provided that no contributions shall be made after the end of the calendar year in which age 65 is attained, and such contributions other than voluntary additional contributions as provided for in Clause 15.2 shall continue to attract University contributions, provided that such University contributions be limited to a maximum of 12% of the member's salary. 15.4 If an election is made under Clauses 15.2 or 15.3 any reference in Clauses 11, 12 and 14 to five per cent (5%), ten per cent (10%) and fifteen per cent (15%) of salary or total salary respectively shall be read and construed as a reference to the members contribution rate, University's contribution rate, and total contribution rate respectively. 15.5 The elections herein referred to shall be made within 6 weeks from the date on which the member of staff commenced to accrue a salary entitlement with the University, and thereafter each year on such date and in such form as the Trustees may decide.

35 It is in relation to Clauses 25.1 and 15.1 of the respective Trust Deeds that what was referred to by Mallesons in their advice as 'clear ambiguity' arises. That ambiguity arises, it was said, because of the insertion of a comma after the word 'University' in the phrase appearing in the first paragraph of Clause 15.1 that reads 'the amount of contributions shall if an officer appointed to the University[,] after having attained the age of 40 years so elects, .....'.

36 A comparative perusal of the same phrase in Clause 25.1 of the Principal Deed will reveal the absence of the comma as it appears emphasised above.

37 The relevant extract of the legal advice received by the Trustee and directed to the respondent commented on the ambiguity created by the insertion of the comma at that point in the sentence as follows: 3.1 On the basis of the terms of clause 15.1 as appearing in the amending deed, there is clear ambiguity as to its meaning. If the clause stopped after the words "appropriate to the age of the member" ... then it would be clear that officers appointed to the University(i.e. the Vice-Chancellor, the Deputy Vice-Chancellors and full-time professors of the University - see clause 7.1) would be entitled to elect to make the higher contributions set out in column 2, thereby causing the University to make the higher contributions set out in column 3, once they were over the age of 40 years - regardless of their ages at the times of their appointment. 3.2 However, the additional words, " at the date he commenced to accrue a salary entitlement with the University " are clearly inconsistent with this interpretation. If clause 15.1 were intended to apply whenever an officer over the age of 40 made an election, regardless of their age at the time of appointment, then the words " at the date he commenced to accrue a salary entitlement with the University " are unnecessary. In the case of an officer appointed under the age of 40 years (say 30 years) how can the words be given sensible effect? 3.3 Reverting to the wording of the Trust Deed prior to the 1988 amendment, it appears that the meaning of the first part of clause 15.1 has been altered by the insertion of a comma after the word "University" in the phrase "the amount of contributions shall if an officer appointed to the University [,] after having attained the age of 40 years so elects,.....'. 3.4 The Trust Deed as it stood at the beginning of August 1978 apparently read: "25 (1) As an alternative to the assurance provisions hereinbefore provided which are based on five percent (5%) of the member's salary together with ten percent (10%) of that salary provided by the University, the amount of assurance shall if an officer appointed to the University after having attained the age of 40 years so elects, be the amount obtainable on payment of a total premium as follows:-... and references...shall be read and construed in the case of a person electing as aforesaid as a reference to the percentage...appropriate to the age of the member at the date of his taking up duty with the University. " The insertion of the comma has therefore created the ambiguity. 3.5 It is our view that it is not possible to resolve the ambiguity simply on the basis of the wording of clause 15.1 as it presently stands. 38 By way of concluding observation, the advice stated: 4.1 Self-evidently, the amending deed in its present form is less than happily phrased. Clause 15 requires urgent amendment to clarify its meaning and avoid confusion to members, while other provisions could usefully be expressed in more succinct, comprehensible and relevant terms. Notwithstanding that the amending deed was obviously prepared in 1988, we suggest that it would be helpful to the Trustee (and the University) for the Trust Deed of the Scheme to be redrafted in the form of a much shorter plain English document.

39 In addition to the Mallesons advice received in February 2000, the Trustee of UNSSS also received advice from Mitchell & Company, Consulting Actuary, in December 2000. That advice agreed as to the ambiguity between Clause 25 of the Principal Deed and Clause 15 of the Amending Deed as highlighted in the earlier advice of Mallesons.

40 The net effect of the advice received was, at the time Professor Winsen made the election he did in 1999, there was no requirement for the respondent to pay the increased contributions that it did. For Professor Winsen to have triggered the respondent's obligation to contribute twenty per cent to his account with UNSSS, Professor Winsen had to have made the election 'at the date he commenced to accrue a salary entitlement with the University'. That provision is common to both clause 25(1) of the Principal Deed and 15.1 of the Amending Deed. As well, when read in conjunction with the provisions of clause 25(1) of the Principal Deed, it means that Professor Winsen was only ever able to make the election that the clause provided for if he was 'appointed to the University after having attained the age of 40 years' and did so within six weeks from the date on which he commenced his employment with the University. It is only when the comma was inserted as earlier highlighted in clause 15.1 of the Amending Deed that employees of the respondent (as well as the respondent) were advised by the Trustee of the elective entitlement for additional contributions able to be made by the employee and the respondent. That belief existed despite the reference in the same clause that the election had to be made within six weeks from the date on which the employee commenced 'to accrue a salary with the University'.

41 There was obviously some misgiving and differing views within the respondent as to its requirement to pay a twenty per cent contribution in the employment circumstances relied upon by the applicant and other employees of the respondent between 1997 and 1999.

42 A reading of the affidavit evidence of Mr Penfold and Ms Minslow reveals there was conflict within the respondent's staff as to the proper construction of clause 15 of the Amending Deed. For example, in June 1997, Mr Don McPherson, the respondent's then Superannuation Officer, advised Professor Dunkley, one of the respondent's employees, in the following terms, relevantly: I refer to your notes dated 3 June, 1997 concerning contributions to the University of Newcastle Staff Superannuation Scheme as well as the Award (3%) superannuation benefit. In regard to your contribution rate, the Scheme's Trust Deed requires you to contribute at the rate of 5% of salary and requires the University to contribute on a ratio of 2:1 on your standard contribution rate. The Trust Deed also allows you to contribute to the Scheme up to a maximum rate of 20% of salary. However the University will not subsidise your contributions beyond its standard rate (10%) . Should you wish to contribute at more than the standard rate (with no additional University subsidy) just put your request in writing. Similarly the additional voluntary contributions may be discontinued at any time with written notification. (emphasis added)

43 However, in April 1998, Ms Minslow had cause to inquire as to the effect of clause 15.1 of the Amending Deed with Mr Langton of the Trust Administration. That inquiry was made on behalf of Professor Samuel. As a result of that inquiry, Mr Langton advised Ms Minslow to the effect that is now in contention. That is, Professor Samuel was entitled to increase his contributions to ten per cent and the University would, as a result, be required to increase its contribution on his behalf to twenty per cent. This Professor Samuel did in April 1998 and the respondent duly increased its contributions on his behalf to twenty per cent.

44 It would seem that, after that, the word spread so to speak amongst the respondent's employees who, as they perceived it, were also able to take advantage of the purported provisions of clause 15.1. One of them was the applicant, one was Professor Dunkley and another was Associate Professor Russell Jones. It was Associate Professor Jones' inquiries that triggered the respondent, in discussions with the Trustee, to obtain the legal advice from Mallesons.

45 In August 1999, Associate Professor Jones wrote to Ms Minslow as follows: Thank you for your advice last Thursday that the University will increase its contribution to my superannuation up to a ceiling when my contribution is 10% of my salary and the University's contribution is 20% of my salary. In response to your advice I am writing to request that my contribution to the Scheme be immediately increased to 10% so that I can take advantage of the arrangement. You will remember my concern last Thursday because I was unaware that the University would increase its contribution to the Scheme beyond 10% of my salary. This is because when I inquired about making additional contributions above 5% of my salary the University's representative, Mr McPherson, advised me that the additional contributions would not be matched by further contributions from the University. This advice was confirmed by Mr Covill (see enclosed a copy of his letter). As this advice to me was incorrect, I would very much appreciate the opportunity to seek compensation for the opportunity that I missed. I am prepared to make a lump sum contribution to cover the period from the date on Mr Covill's letter to the present.

46 Following receipt of the above letter, Ms Minslow detailed the steps taken by her in following up this issue with Mr Mike Jones, Manager, Corporate Superannuation Trusts with AXA Australia: [35] After receiving the letter from Associate Professor Russell Jones, although I do not recall the date, I recall that I telephoned Mr Mike Jones and we had a conversation regarding the interpretation of clause 15.1 of the Amending Deed and the request by Associate Professor Russell Jones to make a retrospective contribution. During that conversation, Mr Mike Jones said to me words to the effect of: I have referred the matter to a colleague and they have a different view on the meaning of the clause. [36] At Mr Mike Jones' request, I forwarded the letter of 5 August 1999 from Associate Professor Russell Jones to the Trustee for its consideration. [37] On or about 8 October 1999, Mr Mike Jones responded to me by facsimile advising that the Trustee did not believe members of UNSSS could make retrospective contributions. The facsimile also advised that a member could only make the alternative contribution if he had attained the age of 40 and elected to pay the alternative contribution within 6 weeks of commencing with the University. The facsimile contained an offer by the Trustee to obtain independent legal advice as to the proper interpretation of clause 15. I passed this facsimile on to Dr Reeves. [38] Shortly following this, Mr Mike Jones asked me to send him any documents held by the University relating to any amendments to the Principal Deed. In the course of collecting these documents from the University's archives, I obtained a copy of the Principal Deed and compared it to the Amending Deed. It was at this time that I discovered the addition of the comma to clause 15.1 of the Amending Deed. I do not recall all of the documents sent to Mr Mike Jones, however, I do recall that I sent him a copy of the Principal Deed and a copy of the Reprinted Deed dated 1 August 1978. [39] On or about 15 October 1999, Dr Reeves, the then Director, Human Resource Management of the respondent, responded by letter to Mr Mike Jones' facsimile of 8 October 1999 as follows: I refer to your facsimile of 8 October 1999 concerning the interpretation of Clause 15 of the University of Newcastle Staff Superannuation Trust Deed. In order to clarify this matter once and for all the University would like to accept your offer to seek independent legal advice on the meaning of the whole of Clause 15. Clarification is also sought on whether a member may make a retrospective contribution. Also, if, as a result of the legal advice sought, it is suggested that Clause 15 be rewritten for the purposes of clarity, it is requested that this also be undertaken. Consideration will need to be given that a number of members have been permitted to increase their basic contribution. In April 1998, Professor Geoffrey Samuel wrote to the University to request that his contribution to the scheme be increased as specified in the schedule in Clause 15.1 of the Trust Deed. Mr Glenn Langton, formally the Consulting Actuary & Principal, was asked for his interpretation of Clause 15 and on his advice Professor Samuel was permitted to increase his contribution to 10% of salary which was subsidised by the University on a 2:1 ratio. Since then another six members have been permitted to increase their contributions. I have enclosed the only known copy of the original trust deed that the University of Newcastle has on its records. If further documentation is required please contact Robyn Minslow on 02 49215259. 47 In short, given the advice received from Mallesons, when the applicant made the election he did in June 1999, there was no requirement for the respondent to increase its contributions to twenty per cent. According to the advice, the only provision the applicant was entitled to exercise was that provided for in clause 15.2 of the Amending Deed which stated: A member may at any age contribute at a rate greater than that provided for in Clauses 11 and 15.1 provided that such rate is not greater than 20% of salary. Such additional member contributions will not attract additional University contributions.

48 As I understand it, the Trust Deed was not re-written as suggested. The reason for that would appear to be two-fold: (i) In or about 1988, UNSSS became closed to new members because of the commencement of what became known as UniSuper. (ii) As UNSSS fund members began to decline, management costs for UNSSS began to increase for remaining members. In February 2000, the Trustee raised this issue with the University. Ultimately, UNSSS members were transferred to UniSuper in or about 2001.

49 As a consequence, Professor Winsen's superannuation entitlements along with other employees were transferred to UniSuper and continuing contributions on his behalf are paid into that Scheme.

50 Following the receipt of the advice received via the Trustee as to the perceived ambiguity with Clause 15 of the Amending Deed, the respondent ultimately determined on a course of action. In March 2001, representatives of the respondent met with Professor Winsen. It should be noted that there were other members of UNSSS who were also spoken to at or about the same time but always on an individual basis. The meeting with Professor Winsen was held on 22 March 2001. According to the evidence of Mr Penfold, who was at that meeting with Ms Beach on behalf of the respondent, he advised Professor Winsen in the terms of a prepared script as follows: 1) You are part of a small group of members who, during 1998 and 1999, requested that contributions be increased from the standard 5%/10% level. 2) The University has always been of the view that this was not permissible because its interpretation of the Trust Deed was that such election could only be made by a person who joined the scheme after age 40 and that the election was only available within 6 weeks of appointment. 3) However, the consulting actuary and administrator to the scheme (NSP Buck) interpreted the Trust Deed in such a way that they believed such an election was legitimate at virtually any time after age 40. Consequently a small number of staff took advantage of that interpretation. 4) We then received a request from one of those staff for backdated contributions. We contacted the Trustee to discuss the interpretation of all matters relating to Clause 15(1) and it was agreed that a legal opinion should be sought which the Trustee arranged - we will provide you with a copy. 5) The legal opinion confirms the interpretation of the University and has been accepted by the Trustee. In addition, a consulting actuary appointed by the Trustee agrees with the legal advice i.e. additional contributions for the group in question do not comply with the terms of the Trust Deed. 6) The University has now been informed of its legal options: (i) cease the additional contributions immediately and recover those contributions from the member's account in the Scheme. (ii) cease the additional contributions immediately and not recover those contributions i.e. treat as windfall to the member. (iii) cease the additional contributions at the time of intended transfer to UniSuper and not recover those contributions - also a windfall to the member. 7) We will recommend option (iii) to the Vice-Chancellor and we would be reasonably confident that he would accept the recommendation. 8) We are speaking to you and the other few involved on an individual basis because you each have different circumstances and we want to avoid the matter being raised at the general meeting on Tuesday as this issue does not arise for the large majority of members and we do not wish to complicate proceedings at the meeting. 9) So, in considering the proposed transfer, you will need to consider yourself as someone who contributes 5% and the University 10%. Brian Penfold Executive Director, Finance & Property

51 According to Mr Penfold, Professor Winsen 'said very little in response to what I had said to him'. According to Professor Winsen, he said words to the following effect: Whatever the correct interpretation of the relevant sections of the trust deed may be, the University and I agreed on a specific interpretation in 1999 and I have relied on that interpretation. We have an agreement which I do not believe the University is entitled to unilaterally repudiate; I intend to seek legal advice to protect my entitlements under this agreement.

52 I have to say, I would find it surprising if Professor Winsen did not react in terms similar to that he now recollects given the situation that then unfolded. In any event, he was not challenged as to that and Mr Penfold was not required for cross examination. What is relevant is the events that flowed from that meeting which I will now deal with.

53 Before I do, it is important to emphasise that the conversation recalled by Professor Winsen with Mr Penfold and Ms Beach on 21 March 2001 encapsulates the essence of the unfairness alleged by Professor Winsen. That is, he says, in 1999 the respondent agreed on a specific interpretation as to the Trust Deed. He (Professor Winsen) had relied on that interpretation in making the decisions and election he did. Further, he asserts, the respondent was not entitled to unilaterally repudiate that agreement. In so doing, the applicant claims, he has lost the current and ongoing value of the respondent's contributions to his superannuation fund at the higher rate. That purported loss forms the basis of the applicant's claim, that being that the respondent is to pay to Professor Winsen's superannuation account an additional amount of 10% of the applicant's annual salary from 8 June 2001 and continuing for as long as the applicant continues to contribute 10% of his salary to the same superannuation fund.

54 As earlier indicated, in correspondence to Professor Winsen of 5 August 1977, the respondent advised that the Vice Chancellor had approved his application for membership of the UNSSS effective from 14 July, 1977.

55 During the period from 1977 until the present, Professor Winsen has had periods of leave without pay from the respondent for the purposes of engaging in external consultancy work. Those periods have been identified by him as follows: (a) 1984 - 1985: Manager-Research with Noble Lowndes (b) 1988 - 1989: Managing Director with Option Technology (Europe) Limited (c) 1997 - 1999: Executive position with Macquarie Generation and consultancy work with Duke Energy International.

56 Professor Winsen's full-time employment with Macquarie terminated in or about 19 March 1999. Macquarie continued to engage Professor Winsen in short term contracts of one day per week from 19 March 1999 to 30 June 1999 and again from 1 July 1999 until 31 December 1999. On 23 December 1999 that one day per week arrangement was continued until 31 December 2000. That latter contract was terminated by Macquarie effective from the week commencing 11 September 2000.

57 In addition to the contracts with Macquarie, both full-time and part-time, Professor Winsen also entered into a consultancy agreement with Duke Energy Australia Pty Limited (DEA) in 1999. That consultancy agreement was for a period from 22 March 1999 and was terminated by agreement effective from 27 May 1999. As I understand the evidence, this consultancy agreement with DEA co-existed with the part-time agreement with Macquarie, particularly during the period of March, April and May of 1999 in that Professor Winsen worked some four days per week for DEA and one day per week for Macquarie.

58 During the periods of leave without pay, employer contributions to UNSSS have been met by the applicant.

59 The applicant stated that at the time he joined UNSSS, he was aware, after attaining the age of forty years, he had an option, at his sole discretion, of electing to increase his superannuation contributions up to a rate of ten per cent of his salary. He also says that if he was to make that election, the respondent was correspondingly obliged to contribute an amount equal to twenty per cent of his salary or a figure double whatever percentage contribution he elected to make but not exceeding twenty per cent.

60 He also stated he understood that in order to exercise that option, it was necessary for him to advise the administrators of the Scheme of his intention to do so in order to trigger the respondents corresponding obligation.

61 I have to say, I have some difficulty with the assertion by the applicant as to his awareness in 1977 of the elective provisions in the Trust Deed that he relied upon in 1999 being as clear cut as he would suggest. To start with, the operative Trust Deed in 1977 was the Principal Deed and the relevant clause was Clause 25.1. As a comparative perusal of Clause 25.1 with Clause 15.1 of the Amending Deed will disclose, the provisions of Clause 25.1 do not necessarily provide Professor Winsen with the belief that he relied upon in 1999 to make the election he did. That is, without more, a reading of Clause 25.1 in 1977 would have strongly pointed to the conclusion that any such election to be made was not available to him as he was then 31 years of age. It is only when the Amending Deed was made in 1988, when Clause 25.1 became Clause 15.1 and the contentious comma was inserted, that the elective provisions Professor Winsen relied upon in 1999 arises. It is at that time, on a reading of Clause 15.1, that Professor Winsen's entitlement to elect after having attained the age of 40 years arises in the way relied upon to make the election he did at the time that he did.

62 It is the applicant's evidence that in 1998 his memory was refreshed as to the option available to him to increase his superannuation contributions to UNSSS up to ten per cent thereby triggering the twenty per cent contribution from the respondent.

63 I believe it was more probable than not that it was only in 1998 that Professor Winsen became aware of the election available to him pursuant to the provisions of clause 15.1 of the Amending Deed. I believe he became aware of that election when he attended a meeting at the University in April 1998. While there was an issue between the parties as to the precise conversation that occurred, that there was a meeting is not disputed. According to Mr Penfold, 'the investment strategies of UNSSS were discussed'. According to the applicant, it was at that meeting that the election requiring the respondent to double its contributions to UNSSS was raised by Professor Dunkley who addressed the following question to the meeting in words to the following effect: How many members have opted to double their contributions with the university also doubling its contribution?

64 Mr Penfold, who was also present at the meeting, has no recollection of such a comment being made by Professor Dunkley, or anybody else for that matter. Nevertheless, I am satisfied that a comment to that effect was made. On the basis of background circumstances that are not entirely clear, it is apparent that in 1998 or thereabouts the issue of the elective provision in clause 15.1 of the Amending Deed became something of a talking point between those members of UNSSS who considered themselves able to avail themselves of the provision. As Mr Penfold himself acknowledged, the applicant was one 'of a small group of members who, during 1998 and 1999, requested that contributions be increased from the standard 5% /10% level.' In all, as I understand the evidence, there were seven such members including the applicant and Professor Dunkley. Accordingly, I believe it was the above comment or a similar comment that triggered the applicant to turn his mind 'to the issue of whether I would make an election to increase my superannuation contributions to the Scheme, and if so, by how much.'

65 In April 1998, Professor Winsen was on leave without pay from the University, having commenced employment with Macquarie in July 1997 on an initial three year contract. According to Professor Winsen, and I accept his assertion to this effect, once becoming aware of the election provisions of Clause 15.1 of the Amending Deed, and, after further contemplation, he 'formed the view that my employment circumstances with the respondent were more attractive than I had previously realised'. It was at that point, sometime after April 1998, that I believe the applicant started to consider his employment options as between the respondent and the private sector with future superannuation entitlements uppermost in his mind. Given that he was then employed by Macquarie, some decisions had to be made.

66 Professor Winsen's contract with Macquarie was for the position of Commodity Analyst. That contract was entered into on the basis that the mutually acceptable date for commencement of employment was 1 July 1997. The terms and the conditions of employment of that contract were governed by an employment agreement specified to be for a term of three years subject also to the condition that at least one month prior to the expiry of that three year period, Professor Winsen was to be advised of Macquarie's intention or otherwise to extend the contract. Professor Winsen's salary with Macquarie was based on a total employment cost of $100,000 per annum with a $10,000 annual performance bonus to be paid according to the achievement of targets. As best as I have understood the evidence, with the exception of the bonus entitlement, his base salary at Macquarie was approximately equivalent to his base salary with the respondent. In relation to superannuation, the contract stated in Clause 14 as follows: The Executive is provided the option to salary sacrifice in relation to superannuation contributions in addition to the corporation's statutory contributions. The provisions of the relevant superannuation scheme shall apply in determining the benefits allowable under this Clause.

67 Although his initial contract with Macquarie was to be for a period of three years, Professor Winsen was granted leave without pay, initially for twelve months only, from July 1997 to June 1998. His period of leave without pay was further extended for another twelve months from July 1998 to June 1999. Clearly, it would have been necessary for Professor Winsen to have sought a further leave without pay period commencing in July 1999 if he was to continue his employment with Macquarie or he could simply have resigned from the University and taken his chances of ongoing employment with Macquarie. It is the applicant's assertion that in 1998, given what he then knew and believed to be his right to significantly enhance his superannuation entitlements if he returned to the University, he opted to do that once he had explored the potential superannuation benefits with Macquarie and found them wanting.

68 By his own account, Professor Winsen enjoyed his employment in the private sector with Macquarie. He explored with management at Macquarie not only his ongoing employment prosects with Macquarie but also, and in particular, the superannuation provisions relating to him should he continue in employment with Macquarie. According to Professor Winsen, in or about December 1998 or January 1999, he had a conversation with Mr Russell Skelton, the Manager, Marketing and Trading, of Macquarie. In that conversation, Professor Winsen said to Mr Skelton words to the following effect: Russell, I have enjoyed working here but the remuneration arrangements whilst similar to the University (of Newcastle) don't encapsulate certain features of the Superannuation Scheme at the University which are extremely valuable. I understand from enquiries that Macquarie Generation is not in a position to match these features and as a result it would seem sensible, from a financial perspective, for me to return to the University.

69 Mr Skelton's evidence corroborates Professor Winsens as to the basis for his resignation and return to the University. As he (Mr Skelton) said: [4] Some time towards the end of Professor Winsen's employment with Macquarie Generation I recall having discussions with him as to his reasons for a proposed resignation and return to employment with the University of Newcastle.

[5] During the above discussions it was clear to me that Professor Winsen felt compelled to return to employment with the University of Newcastle to gain access to the attractive superannuation scheme which would then be available to him. [6] I understood that it was the benefits of the superannuation scheme which lead to Professor Winsen not continuing his employment with Macquarie Generation and returning to the University of Newcastle. 70 Mr Skelton was cross examined thoroughly as to the core point of his evidence and was unshaken as to its essence. That was that Professor Winsen's resignation to return to the University was primarily motivated by his considerations as to the superannuation provisions if he was to remain at Macquarie compared with the 'generous' provisions available to him if he returned to the respondent and exercised the election he believed he had at the time.

71 Mr Skelton was not able to recall exactly where and when the conversation occurred except that it occurred 'in the months preceding his (Professor Winsen's) resignation'. Nevertheless, he was quite clear as to the nature of the conversation which, he said, centred around the applicant's decision to return to the University in order to take advantage of the superannuation provisions available to him. I accept the evidence of Mr Skelton on this issue. Reference to the applicant's resignation on this issue is the applicant's resignation from full-time employment with Macquarie in March 1999.

72 On behalf of the respondent, issue was taken to the applicant's evidence as to the reason for his return to the University. Counsel for the respondent contended there was no connection between the applicant's resignation from Macquarie and his return to the University based on the superannuation issue. On that point, it was submitted that there were other reasons but 'we do not know what they are'. A number of factors were identified as pointing to the absence of such a connection, they being: (i) There is no written letter of resignation located in the applicant's personnel file from Macquarie. (ii) The applicant's leave without pay period was expiring in June 1999. (iii) Even though the applicant resigned from Macquarie in March 1999, he did not exercise the election to increase his and the respondent's contributions until late June 1999, to take effect from 1 July 1999. In other words, the election exercised by the applicant was not done contemporaneously with his resignation from Macquarie which, it was said, would have been expected if superannuation was the pivotal factor in his resignation from Macquarie. (iv) When the applicant was advised in March 2001 of the respondent's intention, because of the legal advice received, to reduce its contribution to UNSSS to ten per cent, the applicant made no comment at that time to the decision he had purportedly taken in 1999 to return to the University for the sole reason of his enhanced superannuation entitlements. (v) When the applicant corresponded with the respondent from 28 March 2001 and onwards, registering his complaint about the respondent's actions in reducing its contributions, he initially made no mention of his prior employment with Macquarie and the reason for his decision to resign from the company and return to the University being because of the superannuation issue. Instead, the applicant referred to the disadvantage he perceived as occurring to him 'in the context of my overall planning for retirement, which involved trade offs between additional scheme contributions and other forms of investment'.

73 Dealing with the last point identified. It was only some two months after the initial meeting with Mr Penfold and Ms Beach in mid May 2001, when pressed by the respondent, that the applicant first raised the issue of 'offers of employment within the electricity industry'. At that time, the applicant also asserted for the first time that: In each case, my decision to return to the University was critically influenced by the prospect of my being able to benefit financially from the increased superannuation contributions which I could attract from the University.

74 The respondent submits that when taken together, the above factors are not persuasive as to the connection the applicant relies upon. As counsel for the respondent submitted, if there is a connection, it is in relation to something 'that has arisen later'.

75 I accept there are some questions that arise in relation to those factors identified by the respondent that, on first consideration, may give cause to question the connection relied upon by the applicant. Nevertheless, overall I am satisfied there was a connection between the applicant's decision to resign from Macquarie and return to the University that arose directly from his (the applicants) considerations as to the generous superannuation benefits available to him if he returned to the respondent and exercised the election that he believed was available to him.

76 The overwhelming impression I gained in considering the applicant and his evidence is that, by 1998, at approximately 53 years of age, he considered his future employment prospects through the prism of future superannuation entitlements. In that respect, he was risk averse and, in contemplating the 'best case' scenario, the private sector offered him limited joy in relation to ongoing superannuation entitlements. Instead, he opted, as he perceived it, for the more generous superannuation entitlements that he had become aware of if he remained with the University. This was despite the fact that he enjoyed working in the private sector, and, by his own admission, had expressed unhappiness with certain aspects of academic life at the University. Nevertheless, when it came to superannuation, there was no contest. The respondent won.

77 I attach no adverse evidentiary significance to the absence of any written letter of resignation from the applicant in his personnel file at Macquarie. Certainly, the evidence of Mr Russell Skelton, the Manager, Marketing and Trading of Macquarie, who was Professor Winsen's reporting superior while he was at the Company, would suggest the contrary. Mr Skelton's evidence was that he envisaged that Professor Winsen's employment with Macquarie would be 'ongoing' and notwithstanding that there was only a three year contract on foot, he had envisaged that contract continuing and he seemed more than happy with the services provided and the work undertaken by Professor Winsen. That much I think, is evident by the letter signed by Mr Skelton when Professor Winsen finally terminated his services with Macquarie in September 2000 when Mr Skelton wrote that: Your contribution to Macquarie Generation and in particular to the Marketing and Trading Group has been significant and highly valued. I trust that this is not the end of our relationship and look forward to an opportunity to work with you again some time in the future.

78 Those words, unsolicited as they were at the time, evince no suggestion on the part of Macquarie that Professor Winsen's departure from full-time employment with them in March of 1999 was anything other than a decision that he, that is Professor Winsen, had taken and was not done at the behest of Macquarie. According to the evidence given by the applicant and confirmed by Mr Skelton, Professor Winsen's part-time employment contract with Macquarie after March 1999 until September 2000 was for Professor Winsen to orientate and assist his replacement.

79 The fact that Professor Winsen did not exercise his election to increase his superannuation contributions until late June 1999 is also something that, in all the circumstances, I do not find surprising. On behalf of the respondent, it was submitted that the applicant's failure to exercise his election until that time instead of some time in 1998 points strongly to the inference that there was no connection between his employment at Macquarie and his decision to return to the University. Given that Professor Winsen became aware of his election entitlement in April 1998, it would have been expected, it was submitted, that he would have acted immediately to exercise that option and advise the University accordingly. In short, it was put it would have been expected that he would have written to the University and said words to the effect of: When I come back on the payroll, whenever that might be, I want to exercise the option I have to require you to contribute twenty per cent of my salary to my superannuation account.

80 While I accept such a course of action was possible, I find more sense in the approach adopted by Professor Winsen. That is, once he had made the decision to return to the University, he gave notice to Macquarie and, in turn and in due course, advised the University of his intention to return from 1 July 1999. He was, until then, on leave without pay. There was not much point in asking the respondent to contribute twenty per cent of a non-existent salary to his superannuation account. As Professor Winsen confirmed, when an employee is on leave without pay, he or she pays the employer's contribution to the relevant superannuation fund. It was only when Professor Winsen returned to the payroll of the respondent on and from 1 July 1999 that his election increasing his contributions and triggering the respondent's increased contribution became practically relevant. Further, at that time, as far as the applicant was concerned or knew, there was no urgency attached to exercising his election. As he knew it, the election entitlement was there and there was no indication at that time it would come to a halt at the time that it did.

81 On or about 1 July 1999, Professor Winsen returned to his employment with the respondent. Just prior to his return, on 28 June 1999, Professor Winsen wrote to Ms R Minslow in her capacity as Superannuation Officer for the respondent. In that letter of 28 June 1999 to Ms Minslow, Professor Winsen advised and requested as follows: My period of leave without pay ends on 30 June 1999 so that I will recommence duties on July 1.

Would you please arrange for my superannuation contributions under the University Scheme of which I am a member to recommence from July 1 at 10% of salary, with the University contributing 20%.

I understand that statutory contributions to UniSuper will recommence automatically as well.

82 There is no record of any formal acknowledgement sent by Ms Minslow to Professor Winsen following his letter of 28 June but it is not disputed that from that time and until 8 June 2001, the respondent did as Professor Winsen requested. That is, Professor Winsen commenced to contribute ten per cent of his salary to the Scheme and the respondent contributed an amount equal to twenty per cent of his salary to the Scheme. The payments made by the applicant were deducted from Professor Winsen's salary by the respondent in accordance with the normal payroll deduction procedures.

83 The respective payments by both parties to UNSSS continued until February 2001 with no comment or queries raised either by Professor Winsen or the respondent. It is clear, however, as the evidence has unfolded before me, that throughout 1999, albeit somewhat slowly, the respondent was becoming aware of the need to clarify certain matters contained within the Trust Deed of UNSSS. Those matters went directly to the provisions of Clause 15 in the Amending Deed that contained the election provisions relied upon by Professor Winsen in 1999. That background has already been detailed earlier in this judgment.

84 The steps taken by the respondent in 2001 when it decided to act but, more specifically, Professor Winsen's response to them in his dealings with the respondent would appear to have given rise to the respondent's conclusion that there was no connection between Professor Winsen's return to the University and the superannuation issue. As well, the respondent submitted that the applicant's response to reasonable requests by it for further and specific information from the applicant was belligerent and uncooperative. In short, the respondent submitted, there was no unfairness as alleged by the applicant and, to the extent the respondent may have been prepared to consider Professor Winsen's request that it reconsider its decision, Professor Winsen's belligerent responses and the absence of specific information from him meant that the respondent was not prepared to make any discretionary decision, as they perceived it, to grant him the relief he sought which was that the respondent continue to contribute 20 per cent to UNSSS or any subsequent superannuation scheme on his behalf.

85 I accept it is surprising perhaps, when Professor Winsen was told in March 2001 at his meeting with Mr Penfold and Ms Beach of the respondent's intention to reduce its contributions to UNSSS, he did not spontaneously refer to his resignation from Macquarie and return to the University as being influenced solely by the superannuation issue. Even on the applicant's own recollection of that meeting, he made no mention of such a significant event, relying simply on his assertion that he had relied on the particular interpretation applying at the time, as had the respondent, and now the respondent was unilaterally repudiating that agreement.

86 I accept the applicant may have been sufficiently upset and so taken by surprise that he did not properly collect his thoughts at the meeting on 21 March when told of the respondent's intention to reduce its contributions on his behalf. Nevertheless, he certainly had had time to collect his thoughts by the time he put pen to paper to Ms Minslow on 28 March 2001. That letter sets out in some detail the situation as Professor Winsen saw it at that time: I wish to make a complaint to be considered under the Scheme's internal complaint handling arrangements.

My complaint is that the University has indicated that it proposes to change its interpretation of clause 15.1 of the Scheme's Trust Deed. Under the interpretation applied to date, I was able to increase my contributions to the scheme from 5% of salary to 10% with the University contributing twice my contribution. Under the new interpretation I will no longer be able to obtain a 20% University contribution should I continue to contribute 10%.

The legal advice obtained by the University (attached) begins by stating that "The wording of clause 15.1 is clearly ambiguous", and then proceeds to provide an interpretation, which the University appears to have accepted, that would deny me the benefits of the additional University contributions referred to above which I have enjoyed to date.

Irrespective of whether the legal advice obtained by the University is correct, I will be disadvantaged through no fault on my part. The decision I made some time ago to increase my contributions was made in good faith in response to the University's previous interpretation of clause 15.1. Having made that decision in the context of my overall planning for retirement, which involved tradeoffs between additional Scheme contributions and other forms of investment, it would now appear inequitable for the University to renege on its prior commitment to also make additional contributions (twice my own).

The resolution I seek is that, irrespective of how the University may interpret clause 15.1 in the future, that the agreement between us made when I opted to increase my contributions continue to be honoured.

I understand that I can expect a response within 90 days. If I am not satisfied with the response, or do not receive a response within this period, I will make a complaint to the Superannuation Complaints Tribunal.

87 While no specific mention is made of his employment circumstances with Macquarie and his return to the University, I do not consider the applicant's failure to specifically mention that issue is evidence that there was no such connection. As earlier stated, I do believe that in 1998/1999, the applicant viewed superannuation entitlements as the paramount consideration in the context of his ongoing employment wherever that employment may be.

88 Following the above correspondence and until June 2001 there followed a series of letters between the applicant and the respondent detailing the respective parties position in relation to the respondent's decision. While it is not my intention to set out all of the relevant correspondence in this judgment, it is necessary to refer to it in some detail. Following the applicant's letter to Ms Minslow of 28 March 2001, the respondent replied on 23 April 2001 relevantly as follows: I refer to the meeting on 22 March 2001 between the Executive Director Finance & Property, Mr Brian Penfold, the Manager Vice-Chancellor's Division and Legal Services, Ms Sue Beach and yourself at which it was explained that, based on incorrect advice in relation to the interpretation of Clause 15.1 of the Trust Deed, the University accepted your request to increase your contributions to UNSSS from 5% to 10% from 26 June 1999. The University accordingly increased its contributions from 10% to 20% in accordance with that interpretation of the Trust Deed from that date. It should be noted that the University has at all times interpreted Clause 15.1 such that the additional contributions were not permitted but it acceded to the advice which it had received. The Trustee later became aware of these circumstances and, in discussion with the University, it was agreed that specialist legal opinion be sought from solicitors Mallesons Stephen Jaques. That opinion confirmed the University's opinion that additional University contributions for you should not have been permitted. A copy of the opinion was provided to you at the meeting and you were advised that it was the intention of the University to revert to contributions of 10% on or about the date of the expected option to transfer to UniSuper (i.e. 1 May 2001) as indicated in the recent document on this matter titled "Trustee's Recommendation to Members". There would be no intention to reclaim any of the University's excess contributions. The University has also carefully considered your submissions that if it accepts the legal advice referred to and reduces its contributions on your behalf to 10%, then you will be disadvantaged through no fault on your part. Having considered all the circumstances, the University has nonetheless decided to discontinue the current arrangements and to reduce its contribution on your behalf to 10% effective from 8 June 2001. In making this decision it is wished to emphasise that it is the University which has been disadvantaged and not the affected members.

89 The applicant responded immediately on 24 April in which he confirmed 'the University's previous oral notice that it intends to unilaterally breach the employment agreement between us so as to discontinue the variation agreed on 26 June 1999.'

90 As well, the applicant stated that he had received advice about 'this matter from both solicitors and barristers specialising in industrial law.' The gist of that advice was that if the University was to proceed with its 'foreshadowed breach' then the applicant believed that he would be successful in obtaining orders pursuant to 's106 of the New South Wales Industrial Relations Act 1996.'

91 Finally, the applicant concluded the correspondence by requesting that the respondent 'continue to honour the agreement currently in force between us.'

92 On 8 May 2001, the respondent replied to that letter, rejecting in the first instance that the applicant had any basis for a claim under s106 of the Act. Significantly however, the respondent stated, in part, as follows: ... The University notes your allegation that you will suffer an inequity if it reverts to a contribution rate of ten per cent in respect of its superannuation contributions to UNSSS (as stated in my letter to you dated 23 April 2001). As such, the University has decided to give you fourteen days from the date of this letter to provide detailed reasons supporting your claim relating to inequitable treatment.

93 In addition to the above, the respondent indicated it would be appreciative if the applicant was to provide it with a copy of any legal advice the applicant had received.

94 The applicant responded to the 8 May letter from the respondent on 16 May 2001 in the following terms: I had been aware since joining the University of Newcastle Staff Superannuation Scheme in 1977 that at some stage there would be an opportunity to double my own contributions and those of the University. This awareness was reinforced over a number of years at meetings in which representatives of the University tacitly acknowledged this option. I recall, in particular, a meeting in April 1998 (which I attended even though I was on leave without pay) in which Professor Peter Dunkley inquired how many members other than he had opted to double their own and the University's contributions to the scheme. That meeting was attended by the Bursar, Mr. Brian Penfold. On reaching the age of 50, and with my eldest child approaching completion of her education raising the prospect of my having additional disposable income to invest, I re-examined the possibility provided for in the trust deed for me to double my contributions (and obtain a doubling of the University's contributions). At that time I undertook two years unpaid leave from the University to pursue full-time consulting services within the Australian Electricity Industry. During my period of unpaid leave, I received a number of generous (financially and professionally) offers of employment from within the electricity industry. In each case, my decision to return to the University was critically influenced by the prospect of my being able to benefit financially from the increased Superannuation contributions which I could attract from the University. On my return to University employment in mid 1999, I wrote to the Superannuation Officer and requested that my Superannuation contributions be doubled along with those of the University. Following this request, both myself and the University doubled our contribution rates into the Scheme. It is my advice that, as a result of my taking up the option, the University was in mid 1999 and remains obliged to continue with a Superannuation contribution rate of 20% of my salary. The Superannuation fund into which these contributions may be placed in the future is open to discussion. My career with the University and the financial planning for my future, including my retirement, have been significantly affected by the Superannuation contribution arrangements currently in place. If the University unilaterally alters these arrangements, without my consent, I will be obliged to seek legal recourse, thus involving added legal expense for both myself and the University. I urge the University to reconsider its position. I note your request to receive a copy of my legal advice. I am advised that such advice is private between me and my legal advisers and that I am not in a position to share it with the University. 95 The letter of 16 May 2001 from the applicant to the respondent raised for the first time the purported connection between the respondent's decision to return to the University as being 'critically influenced' because of the increased superannuation contributions that would arise when he exercised the election that he understood to be available to him. The respondent points to the date of this correspondence, being 16 May 2001, as being the first time that the applicant had raised this purported connection. In its view, Professor Winsen belatedly asserted such a connection in order to strengthen his claim in relation to the matter now before the Court. I have dealt with this submission earlier in this judgment.

96 For reasons I have already indicated, I am satisfied the determining factor that influenced Professor Winsen to return to the University when he did in 1999 was the expectation of the increased superannuation contributions on the part of the respondent. Whether or not the applicant had a long term future with Macquarie is not the issue, in my view. Indeed, it is not a matter that Professor Winsen claims. Professor Winsen makes no claim as part of the unfairness he alleges as to any loss arising by way of lost opportunity or income arising as a result of his decision to return to the University. Professor Winsen claims quite simply that in weighing up his employment opportunities with Macquarie, particularly in relation to superannuation, compared with him continuing with the University in the knowledge of its obligation to pay extra superannuation contributions should he return and so elect, he opted for the latter because they were significantly more beneficial in the long term.

97 In any event, the respondent was not happy with the information given to it by Professor Winsen in his correspondence of 16 May 2001. They wrote to him again on 28 May 2001 in the following terms: The University considers that you have not provided sufficient information relating to your allegation that you will suffer an inequity if it reverts to its former, lower rate of superannuation contributions. However, the University is prepared to offer you a further opportunity to provide detailed particulars to substantiate your claim. Therefore, would you please write to me, providing details of the following:

· the "tacit acknowledgements" made by representatives of the University relating to the higher rate of superannuation contributions (including particulars of the substance of each such acknowledgment, the identity of persons making such acknowledgments and the date/s on which those acknowledgments were made);

· the inequity suffered by you (including particulars of the date/s of each of the alleged generous employment offers made to you from within the electricity industry, the identity of the persons/organisations making such offers, the quantum in dollar terms of each such offer and the inequity suffered by you as a result of turning these offers down);

· the effect the higher rate of superannuation contributions has had on your career with the University and your future financial planning, including your retirement. As the University has already provided you with one opportunity to provide detailed information regarding the alleged inequity, it requests that you provide the further detailed particulars as set out above within 7 days from the date of this letter.

Please note that the University reserves the right to seek confirmation of the information which you provide by way of statutory declaration. This should not be seen as any reflection on your veracity, but as an indication of the care with which the University deals with the funds which it receives.

98 That correspondence pushed Professor Winsen to the limit of his patience as far as he perceived the respondent's unhelpful response to his request. In short, he considered that any request for further information was becoming something of a time wasting exercise. On 4 June 2001, he responded in relatively brief terms as follows: The fact that the University has been making contributions to my account with UNSSS amounting to 20% of my salary for the past two years, would appear to suggest more than "tacit acknowledgment" over this period by the University of my entitlement to such a level of University contributions. It should be obvious that if the University now unilaterally reduces its contributions to my account with UNSSS to 10% of my salary, I will suffer significant financial detriment. As indicated in previous correspondence, I consider that, as a result of our previous agreement, I have a right to have the University contribute an amount of 20% of my salary to my account with UNSSS. If the University does reduce its contributions to my account with UNSSS to 10% of my salary, I will regrettably have no alternative but to seek legal redress. I have been advised that there now seems to be little point in continuing this letter trail.

99 The applicant viewed the respondent's ongoing correspondence as nothing more than filibustering on its part rather than any genuine attempt to resolve the issue. It should also be said that in the correspondence of 28 May 2001, where the respondent stated it 'reserves the right to seek confirmation of the information that you provide by way of statutory declaration.' was viewed by Professor Winsen as the respondent indicating, having regard to whatever additional information he may provide as to alternative employment opportunities from various companies, it may seek to obtain independent verification from them by way of statutory declaration. In other words, the applicant did not view that sentence as requiring him to provide a statutory declaration of those matters that he asserted but rather that it was the respondent asserting its right to seek independent verification by way of statutory declaration from other persons or organisations that he may give information about to the respondent.

100 At the hearing before me, issue was taken on behalf of the respondent in that it was said, at no time did Professor Winsen ever bother to provide the respondent with the statutory declaration setting out relevant information that he sought to rely upon in relation to alternative offers of employment in the private sector relevant to his decision to return to the respondent and exercise the elective provisions relied upon. I have to say, to the extent that that matter was raised, I do not read the sentence that counsel for the respondent referred to as clearly indicating that the respondent was seeking a statutory declaration from Professor Winsen but rather that the respondent was asserting its right to obtain independent verification by way of statutory declaration from other persons or organisations, should it wish to do so following any information received from Professor Winsen. I make that statement in light of the issues arising in relation to the respondent's decision in relation to Professor Dunkley vis-a-vis that of the applicant which I will come to shortly.

101 The exchange of correspondence between the applicant and the respondent that took place between 28 March 2001 and early June 2001 is the evidence that the respondent points to of the applicant's 'belligerence' in the way in which he sought to pursue the respondent in relation to this matter. While there is no doubt that the applicant was quick off the mark to assert his rights as he perceived them vis-a-vis the respondent in relation to the superannuation issue and certainly quick to assert his intention as to legal advice received, I do not perceive the correspondence and the tenor of it as indicating belligerent behaviour on the part of the applicant in the sense of being excessively aggressive towards the respondent in the way in which he chose to communicate with them. He was certainly firm as to his perceived entitlement and the respondent's obligations from the outset but there is nothing in the tone of his correspondence nor in the evidence he gave before me that I would characterise as belligerent as that word is generally understood. Stubborn and persistent perhaps and single minded as to what he believed to be his rights. He also became increasingly impatient with what he perceived to be the respondent's failure to promptly rectify what he saw as a straightforward issue of unilateral and unfair action on the respondent's part. Having said that, none of those characteristics should, in my view, be held against the applicant in pursuing a matter that was clearly very important to him. In any event, even if he was belligerent, that is not a basis for the respondent exercising any discretion against him.

102 The letter to Ms Minslow of 28 March 2001 indicated at the beginning that Professor Winsen wished his complaint to be considered under 'the Scheme's internal complaint handling arrangements.' That complaint was acted upon and on 14 May 2001 the applicant received a letter from Mr Mike Jones, the Manager, Corporate Superannuation Trusts for AXA Australia. That letter stated relevantly as follows: I refer to your letter of 28 March 2001 to Ms Robyn Minslow, the superannuation officer for the University of Newcastle, wherein you have expressed a complaint and requested that it be considered in accordance with the above Scheme's internal complaint-handling procedure. Your letter has therefore been referred to us for attention in our capacity as Trustee of the Scheme although we note that by way of initial response, Professor English has expressed the University's views in relation to the matter. ... ... While we fully understand the basis of your concerns, you will understand that it is our duty to examine the known facts in the light of the Scheme's governing trust deed and with due regard to superannuation law. We have proceeded on this basis. Our consideration of your complaint included a thorough re-examination of the circumstances that gave rise to it. These were taken fully into account. We also considered your own views as well as those of the University and on balance, with due regard to those circumstances, the approach adopted by the University appears to us to be both fair and reasonable. Specifically, our own interpretation of the relevant provisions of the trust deed, has led us to the conclusion that the University's decision to cease its current level of contributions to the Scheme on your behalf is not in conflict with any specific provision of that deed. Neither does it appear to us that its decision is contrary to either the spirit or substance of the underlying legislation (the Superannuation Industry (Supervision) Act 1993). It would appear also to be consistent with the general principles of trust law. In reaching these conclusions, we have been aided also by the advice of Mallesons Stephen Jaques; a highly respected firm of lawyers with considerable knowledge of and proven expertise in the interpretation of superannuation law.

Accordingly, we cannot disagree with the right of the University to cease contributing to the Scheme generally and, in your case specifically, to resume its obligation to contribute albeit on a different basis under UniSuper.

We must therefore advise you of our opinion that there is nothing in the letter to you from Professor English on 23rd April 2001 that constitutes a justifiable basis for complaint on the grounds that the University's decision, as therein re-iterated, is contrary to the provisions of the Scheme's trust deed specifically or to superannuation law generally.

103 On behalf of the respondent it was submitted that the applicant had sustained no unfairness as a result of the respondent's actions. Indeed, it was said that the applicant, by dint of the respondent's increased contributions from 1999 to 2001, had received a windfall in that he had received contributions to which he was not entitled. Further, the respondent was not seeking to recover any of those excess contributions paid and had also given the applicant some three months notice of its intention to reduce its contributions. That is, the respondent notified the applicant in March 2001 of its intention to reduce its contributions and that reduction did not take effect until 8 June 2001. Also, the respondent raises, quite properly in my view, important public interest considerations in the decision it took. On that issue, it was contended the respondent is in receipt of public funds as a major component of its funding base. That fact in itself creates legal and accountability issues. On that point Mr Penfold stated in his affidavit: [51] From my review of these documents, I am aware that the University contributed an additional payment of $19,241 in respect to Professor Winsen under clause 15.1 for the period 26 June 1999 until 8 June 2001. The University has not sought to recover this overpayment, despite the advice given to Ms Beach and I by Mr Beeny on 20 March 2001 (see paragraph 37). [52] If the University had decided to make contributions at the increased rate under clause 15.1 of the Amending Deed in respect of Professor Winsen from 1998 until Professor Winsen reached the age of 65, I estimate that the increased cost to the University would be approximately $81,775.95. I base this estimation on the following calculation: (10% of $96,207 per annum) x 7.5 years = $72,155.25; plus (2% of $96,207 per annum) x 5 years = $9,620.70. [53] Again, these figures do not include potential pay increases, interest and pay roll tax.

104 There is, I believe, much to be said for all of the above arguments but for the respondent's different treatment of Professor Dunkley to which I shall shortly refer. However, in addition to the applicant, as was abundantly clear, there were other employees of the respondent who have exercised the same election as the applicant - some seven in all, as I understand it. With the exception of Professor Dunkley, the ultimate outcome for the other employees, presumably caught up in the same issue as the applicant, was never elaborated upon in evidence before me.

105 There is, nevertheless, unchallenged evidence of Mr Penfold that refers to the wider public interest considerations that embraces those other employees if the respondent had not made its decision to reduce its superannuation contributions when it did. According to Mr Penfold, his advice to the then Vice-Chancellor in March 2001 was that if the respondent did not reduce its contributions consistent with the legal advice received 'future costs could be ... well in excess of one million dollars.' As Mr Penfold elaborated: [43] I arrived at the estimated loss figure of $1 million provided to the Vice Chancellor by virtue of my own calculations, which were based on the following information. From my role as Executive Director, Finance and Property, I estimated that the annual salaries of each of the 7 professorial staff concerned was approximately $100,000. I was aware that each of these professorial staff received an approximate amount of 10% of their salary in increased superannuation contributions from the University under clause 15.1. [44] I also knew that, at the time of my conversation with the Vice Chancellor, the University had been making the increased contributions to these 7 professorial staff for approximately 2 years. If that level of contribution were to continue each of these staff members would continue to receive the increased contributions until age 60, in accordance with clause 15.3 of the Amending Deed. Thereafter, the total of the University's contributions on behalf of these members would be 12% until the end of the year in which the member turned 65, the additional amount payable by the University under clause 15.1 during this time thereby being reduced to 2%. [45] The average age of each of the 7 staff members at the time of my conversation with the Vice Chancellor was about 54. While professorial staff of the University are under no legal obligation to retire at any particular age, it was then not uncommon that such staff retired at approximately 65 years of age. [46] Based on this information, I calculated that the approximate amount that had been lost by the university by that time in respect of the 7 professorial staff over the 2 year period was as follows: 7 staff x (10% of $100,000 per annum) x 2 years = $140,000.

[47] I also calculated that the amount that the University could potentially lose in respect of all of these staff, from the time of my conversion with the Vice Chancellor until the time the staff were likely to retire (a period of approximately 11 years), was as follows: 7 staff x (10% of $100,000 per annum) x 11 years = $770,000. [48] These figures did not include potential pay increases of the staff concerned, pay roll tax or the interest lost by the University in respect of the University's inability to invest the above amounts over the 13 year time period. In total, I estimated that the cost to the University of the additional contributions then being was approximately $1 million. No actuarial calculations were obtained by the University to confirm my calculations in this respect. 106 Taking account of public interest considerations only insofar as the applicant is concerned, I accept the respondent could not properly ignore the legal advice it had received via the Trustee from Mallesons as to the probable and proper construction of the Trust Deed and the ambiguity identified. That legal advice was subsequently supported by the Consulting Actuary. Clearly, the respondent took the view it was required to act upon that advice in accordance with its responsibilities pursuant to the Trust Deed. The applicant, in my view, has implicitly acknowledged the correctness of that advice in that at no time has he sought to directly challenge it. The applicant simply says that 'Irrespective of whether the legal advice obtained by the University is correct...' he had an agreement with the respondent as to the interpretation of that Trust Deed, he relied on that agreed interpretation in making the decisions he did and, by the respondent unilaterally varying that agreement, it had done so to his detriment.

107 On first considerations of the Principal Deed and the Amending Deed, and in particular Clause 25 of the Principal Deed and Clause 15 of the Amending Deed, the ambiguity the legal advice of Mallesons refers to is clear. In other words, while I am not required to construe the Trust Deed, the nub of the advice given by Mallesons leading to the conclusion that it did as to the respondent's obligations vis-a-vis its contributions to the scheme on behalf of the applicant would, on the face of the relevant provisions, appear to be correct. Accepting that as a starting point, it is necessary to consider the actions of the respondent in order to determine whether what it did was, in all the circumstances, unfair and, in turn, whether any unfair conduct reflects or demonstrates contractual unfairness.

108 Over a period of more than twelve months, the respondent did a number of things. When the issue of its contribution obligations pursuant to clause 15 of the Amending Trust Deed came to the fore, independent of the applicant, it took steps to raise the issue with the Trustee. As a result, legal advice was sought from Mallesons. That advice confirmed the ambiguity already identified. That legal advice was independently and subsequently confirmed. At that point the respondent, accepting that it had a responsibility to act pursuant to that advice, properly considered the steps it should take vis-a-vis the applicant and others. In coming to the decision that it did, it did so having identified that it had three ways it could choose to deal with the issue. Those three options were: (i) cease the additional contributions immediately and recover those contributions from the member's account in the Scheme (ii) cease the additional contributions immediately and not recover those contributions i.e. treat as windfall to the member (iii) cease the additional contributions at the time of intended transfer to UniSuper and not recover those contributions - also a windfall to the member. Mr Penfold went on to state that he would recommend option (iii) to the Vice-Chancellor and that he was reasonably confident that the Vice-Chancellor would accept the recommendation.

109 Ultimately, the decision it came to having regard to the advice it had received, was to not seek to recover any purported overpayments it had made and to give some degree of prospectivity to its decision to reduce its contributions to the scheme on behalf of the applicant and the other employees also affected. I see nothing inherently unfair in that decision. In my view, the respondent was confronted with legal advice it could hardly ignore. The unchallenged affidavit evidence of Mr Penfold is that the respondent believed the advice to be correct and that it was incumbent on the respondent to act upon it. This was so, given that to ignore the advice had significant financial and public interest implications for the respondent in the long term.

110 Given the circumstances confronting the respondent, I believe it made a proper and fair decision to balance its financial and public interest obligations against the interests of the individual fund members, including the applicant, who would clearly be affected by the decision of the respondent to reduce its contributions to the scheme on their behalf. Hence the decision made not to recover any excess contributions made and to give the affected members notice of its intention to reduce contributions as well as provide a copy of the legal advice received and on which its decision was based. Against that background, I do not believe the respondent acted unfairly.

111 I come to that view notwithstanding I am satisfied there was a connection between the decision made by the applicant to return to employment with the respondent once he had considered and assessed the respective superannuation conditions in the private sector compared with his perceived entitlement should he return to the University.

112 If the respondent's actions in relation to this matter were all that I have so far detailed, I would have concluded that the respondent had not acted unfairly in relation to its contract of employment with the applicant. However, there is a further element to this matter that requires consideration before a final decision can be made as to the applicant's claim. That matter goes to considerations of alleged unfairness arising from the respondent's actions in relation to Professor Dunkley when compared with the applicant. I now turn to that issue.

113 One of the other employees who was also entitled, as he perceived it, to exercise the same election that the applicant did under the terms of the Amending Deed was Professor Dunkley. Professor Dunkley was and, as I understand it, still is the Professor of Medical Biochemistry with the respondent and head of the School of Biomedical Sciences. Professor Dunkley joined the University as a lecturer in 1978 and had been a member of UNSSS since that time. Professor Dunkley was on the same salary level for superannuation purposes as the applicant.

114 There is no dispute that in about August of 1998, Professor Dunkley requested certain information from Ms Minslow on behalf of the respondent about his (Professor Dunkley's) understanding of the increased personal contribution rates that he could make to the Scheme that would result in the respondent matching that contribution up to a maximum of twenty per cent. That understanding as to Clause 15.1 of the Amending Deed was confirmed by Ms Minslow. Accordingly, Professor Dunkley exercised the same election as Professor Winsen, requesting that his superannuation contributions be increased to ten per cent thereby bringing the respondent's contribution on his behalf to twenty per cent. That took effect on or about 17 September 1998. From that date and until the present, the respondent has continued to contribute twenty per cent to Professor Dunkley's account in his superannuation account which is now, like the applicant's, with UniSuper.

115 In March 2001, on the same basis and for the same reasons in relation to Professor Winsen, the respondent advised Professor Dunkley of the legal advice received from Mallesons, gave him a copy of that advice and told him in the same terms as told to the applicant, it was intending to reduce its contributions on his behalf from twenty per cent to ten per cent. The meeting with Professor Dunkley took place on 22 March 2001, the same date as the meeting with Professor Winsen occurred but at a later time in the day. According to the unchallenged evidence of Mr Penfold, at that meeting Professor Dunkley was present with his wife. Once Mr Penfold conveyed the respondent's intentions, according to Mr Penfold, Mrs Dunkley advised him in words to the following effect: Peter recently rejected a job offer with the Australian Research Council, which paid a higher salary than that which he is receiving at the University. He rejected the offer because he understood that the University would continue to make superannuation contributions at the rate of 23% on his behalf. We have done relevant calculations of the respective remuneration packages from the Council and the University and we have also made financial and investment decisions having regard to Peter's super entitlements at the University.

116 By way of explanation, reference to '23%' in the above is reference to the twenty per cent being paid by the respondent pursuant to the elective provisions of clause 15.1 of the Amending Deed plus a further 3% paid as part of the respondent's obligations pursuant to other statutory or industrial instrument provisions paid to all employees, including the applicant.

117 As a result of the information given by Mrs Dunkley about Professor Dunkley's job offer with the Australian Research Council, Mr Penfold asked Professor Dunkley to provide the respondent with a statutory declaration outlining those details. Further, Mr Penfold said, having received that statutory declaration, they would then discuss the matter with the Vice-Chancellor and advise Professor Dunkley further.

118 Professor Dunkley did provide the statutory declaration in which he set out the background including the details concerning the position he had been offered with the Australian Research Council. That position was at a greater salary than he was receiving at the time from the University. However, Professor Dunkley stated in his statutory declaration that he had withdrawn his application for the position at the Australian Research Council because at that time he had already exercised his election to have his superannuation contributions increased. As he said in his statutory declaration: As a result of the job offer, I and my wife performed a number of calculations concerning the relative remuneration packages available in my existing position at the University of Newcastle on the one hand, compared to the offered position at the Australian Research Council on the other. The salary offered at the Australian Research Council was greater than the salary in my position at the University of Newcastle, however the superannuation contributions being made by the University of Newcastle were significantly better than those available at the Australian Research Council. This calculation assumed that superannuation contributions totalling twenty three per cent of my salary would continue to be made by the University of Newcastle, as it had done since 1998. As a consequence of that calculation, and based on my understanding of my superannuation entitlements at the University of Newcastle, I withdrew my application for the position at the Australian Research Council. Had I been aware that the University may not continue to contribute the superannuation at an effective rate of twenty three per cent of my salary I may well have made a different decision. My wife and I have generally arranged our financial and investment affairs in reliance upon my entitlement to receive superannuation contributions at an effective rate of twenty three per cent of my salary.

119 Following the receipt of Professor Dunkley's statutory declaration, Mr Penfold and Ms Beach met with the Vice-Chancellor to discuss Professor Dunkley's claim. In those discussions, a decision was made by the Vice-Chancellor that the respondent should continue making the increased contributions of twenty per cent on Professor Dunkley's behalf. That decision was made on what is expressed as being the 'special circumstances' as outlined in Professor Dunkley's statutory declaration.

120 Further, on the affidavit evidence of Ms Beach, who was also present at the meeting with the Vice-Chancellor when the decision was made to maintain the respondent's contribution on Professor Dunkley's behalf, the motivating factor that persuaded the Vice-Chancellor to determine as he did, was that Professor Dunkley was considered by the Vice-Chancellor to be 'an excellent researcher and (he) attracts large grants to the University. We don't want to lose him.'

121 On the affidavit evidence of Mr Penfold it was asserted, and not challenged, during the ten year period immediately prior to the time of the meeting with the Vice-Chancellor, Professor Dunkley had attracted external research funding to the University in the sum of approximately $1.9m. By way of comparison, as the evidence disclosed, Professor Winsen had attracted no external research funding to the University.

122 It is difficult to come to any other conclusion other than the self evident one that the decision made by the Vice-Chancellor to allow Professor Dunkley to continue to receive twenty per cent superannuation contributions from the respondent while at the same time reducing contributions it was making on behalf of Professor Winsen to ten per cent was based largely but not entirely on commercial considerations centred around Professor Dunkley's ability to attract research grants to the University. This is because the respondent put a further additional argument to that proposition. That was, it was said, when Professor Dunkley and his wife were advised of the initial decision taken by the respondent to reduce its contributions, Mrs Dunkley immediately volunteered the information as to alternative employment opportunities that had been foregone and, more significantly, promptly and cooperatively provided all of the details relating to that by way of statutory declaration. This response compared favourably, in the respondent's view, to the 'belligerent' attitude adopted by Professor Winsen who took some two months to proffer alternative employment opportunities as being a relevant consideration in his decision to return to the University and take up the increased superannuation contributions. The respondent points to Professor Dunkley's immediate proffering of that information as evidence of his credibility and veracity when compared, it says, to the belated way in which Professor Winsen raised the same issue. As well, the respondent says, at no time did Professor Winsen ever produce such a statutory declaration. Further, it was said, Professor Winsen resisted, with a degree of aggressive behaviour threatening legal action, to every reasonable request on its part to provide them with details that may have assisted them to make the decision that he was wanting them to make.

123 In considering this issue, it must be said that the comparative treatment by the respondent of Professor Winsen versus Professor Dunkley was not a matter raised by the applicant in the initiating summons for relief. It would seem that it was not until the respondent filed its affidavit material that the applicant became fully aware of the different decisions made by the respondent between the two employees in relation to this contentious issue. Not surprisingly, the applicant points to that as further evidence of the unfairness that he says the respondent visited upon him in the way in which it dealt with his superannuation arrangements.

124 For its part, the respondent makes no attempt to resile from its decision in relation to Professor Dunkley and the reasons why it did make that decision. In doing so, it says, it is a difference in decision making that it was entitled to make for the reasons that it was entitled to take into account. As counsel for the respondent contended: The position with Professor Dunkley was he was made an offer and he identified the offer to the University. Professor Winsen wasn't made an offer and even if he was made an offer he did not identify that to the University so the material available to the University to make the decision with Professor Winsen and Professor Dunkley was different, was very different. ... ... The belligerent non response of Professor Winsen is to be compared with the spontaneous response of information from Professor Dunkley and indeed it is not until the University in these proceedings through the procedures of the Court is able to get any detail and then we have to cross-examine about the detail...

...it is the way the matter developed at Professor Winsen's behest, but aside from that, if there was a reasonable approach, why were we not given the information and we were not. We asked for it, and got: 'We are not going to assist you in your paper trail' response. That is a substantial area of distinction between Professor Winsen and Professor Dunkley. Next, it is said: Well, the University made their decision because Professor Dunkley is a person attracting research grants. We do not hide behind that and we say Professor Dunkley does attract research grants and that is very important to the operation of the University. It is true we would not want to lose Professor Dunkley in the modern environment in which universities operate now.

Professor Winsen is in a different category. 125 In relation to the above contention on behalf of the respondent, the response was that attraction, or lack, of research funding forms no part of the arrangement between the respondent and Professor Winsen in relation to his superannuation contributions. To put it in the alternative, the respondent's twenty per cent (or any other per cent) superannuation contribution was in no way contingent upon research funding that the applicant may or not attract to the University. In short, it formed no part of that arrangement. Despite that, it was contended, it is now being used by the respondent in that way.

126 The question of research funding was never explored in the sense that Professor Dunkley was a Professor in a faculty that conducts medical research which may well have a greater capacity for attracting research funding as opposed to the Faculty of Commerce, of which Professor Winsen is a part. I simply do not know. More significantly, the question arises as to whether the issue of research funding is or is not relevant to the decision made by the respondent in relation to Professor Winsen's superannuation contributions. In my view it is not and in that respect I agree with the submission of counsel for the applicant. For the respondent to now point to research funding that may or may not be given to the University as somehow being a most relevant or determinative consideration upon which the respondent exercises a discretion about increased superannuation contributions to distinguish between two employees on the same salary and operating under the same conditions of employment is, in my view, unfair. Further, on the basis of Professor Dunkley's apparent prompt response to requests for information and that he had attracted research funding to the University as the reason for continuing to contribute twenty per cent to his superannuation fund on an ongoing basis seems to me to be treating Professor Dunkley much more favourably than the applicant without a fair or proper basis for doing so. The respondent says simply that it was entitled to make that decision and that it was fair. I do not agree.

127 The real vice or inequity in that approach is that what the respondent has done vis-a-vis Professor Dunkley is to guarantee him, going forward, an entitlement to superannuation that is in no way linked to any future work performance in relation to research funding. In other words, Professor Dunkley may attract no further research funding to the University from now until his retirement.

128 The basis relied upon by the respondent to differentiate between the applicant and Professor Dunkley can be characterised as the applicant being slow and belligerent whereas Professor Dunkley was prompt and polite in their respective responses to requests for information from the respondent. Further, Professor Dunkley brings in money to the University, the applicant does not. In my view, neither are objectively defensible and exemplify a real inequity.

129 In support of their respective contentions on this issue, both parties referred to the decision of the Full Court of the Industrial Court of New South Wales in Baker v National Distribution Services Limited (1993) 50 IR 254. In that decision, the Court considered, as an alleged unfairness, the difference in treatment in relation to redundancy payments made to weekly employees as opposed to monthly employees. In the factual circumstances of that matter, the employer had made the decision to discontinue a section of its business and, as a result of that decision, several hundred employees were made redundant. That redundancy included Mr Baker. Mr Baker was in a management position and, as such, he was considered to be a monthly employee. The other category of staff being made redundant were weekly employees and their employment was governed by certain industrial awards. A redundancy agreement had been brought about as a result of negotiations between the employer and the relevant union of employees representing the weekly employees. That redundancy agreement afforded the weekly employees redundancy benefits considerably more favourable than the employer's policy applicable to the monthly employees, including Mr Baker. For example, whereas Mr Baker was entitled to five months service pay, being over forty-five years of age with nearly twenty seven years service, a comparable weekly employee on redundancy was entitled to in excess of twenty seven months as service pay and age allowance. On any view, the magnitude of the difference was manifest and that was in large part the basis of Mr Baker's allegation of unfairness as between he and his employer.

130 In the decision at first instance and subsequently on appeal, the Court was obliged to consider whether the different treatment as between Mr Baker and the weekly employees in terms of redundancy entitlements demonstrated unfairness in the contract. As the Court stated at 270: It seems to us the issue for determination on appeal is whether the contract of employment or employment arrangement as between the appellant and the respondent was, either in its terms or in its operation, unfair or otherwise offended the grounds contained in s275(1). The answer to that question is not assisted, in our view, by an examination merely of matters external to the circumstances existing as between the parties to the contract or arrangement, although it must be acknowledged in a realistic sense that in assessing whether unfairness has occurred recourse to general standards or levels of what is considered to be fair will be a factor to take into account, even as a guide. In other words, s275 occupies a most special role in the scheme of the Act by enabling the Court, in relation to transactions within its scope, to grant relief inter partes according to ordinary standards of fairness but nevertheless by directing attention to the particular circumstances of the individual contract or arrangement concerned.

131 Further, at 274, a passage to which my attention was drawn by counsel for the respondent, the Court said: Whilst in some cases of wholesale retrenchments, as his Honour found, it may be entirely fair and reasonable for a redundancy payment policy to differ as between monthly (staff) and weekly employees, this is not, in our view, such a case. Each case must necessarily be seen in terms of its own particular circumstances. The facts here disclosed a redundancy payment policy unilaterally determined by the respondent some years ago when retrenchments were not imminent; on the arising of financial circumstances requiring the closure of the confectionary products distribution business, with the consequence of retrenchments on a large scale, the respondent elected to negotiate a redundancy package with its weekly employees at an extraordinarily generous level so as to ensure the industrial good conduct of those employees during the critical closure procedure.

132 The test of what is or what is not unfair within the meaning of s106 of the current Act has long ago been considered within the meaning of s88F of the former Industrial Arbitration Act 1940 and subsequently, s275 of the Industrial Relations Act 1991: see Davies v General Transport Development Pty Limited (1967) AR (NSW) 37 at 374 (which was highlighted in Baker) that expressed the test of unfairness as being: ...the commonsense approach characteristic of the ordinary juryman ... It is a plain matter of morals not law.

133 The words of Beattie J in Agius v Arrow Freightways Pty Limited (1965) AR (NSW) 77 at 89 are also instructive where his Honour said in determining unfairness, it was matter of deciding 'in each particular case by the application of the Tribunal's commonsense and sense of justice whether a particular transaction is unfair, harsh and unconscionable'.

134 While it is clear that any determination as to whether a contract is or has become unfair is a matter to be decided upon consideration of the particular facts of the matter before the Court, that principle of itself does not derogate, it seems to me, from the entitlement of the Court to consider not just the facts pertaining to the particular applicant/employee before the Court, but also the facts pertaining to other employees in the same circumstances. This principle was referred to by the Court of Appeal in Rothmans Distribution Services Limited v Full Court of the Industrial Court of New South Wales (1994) 53 IR at 157. As is well known, that decision is an appeal to the Court of Appeal arising from the Full Bench decision in Baker v National Distribution Services. One of the grounds relied upon by the appellant was that even if the Full Court was within jurisdiction in examining the contract of Mr Baker to determine whether it was unfair at the date of the decision to give redundancy benefits to the him that were different from those given to the weekly employees, it was said that the Court went beyond its jurisdiction when, in considering fairness, it took into account the way in which the appellant had dealt with the weekly employees who were characterised by counsel for the appellant as 'third parties'. In considering that point and rejecting it, the Court of Appeal said as follows at 161: I do not think when the employment of a number of employees is being terminated at about the same time, that the question of what is unfair in regard to one employee must necessarily be decided without reference to what happens in the case of the other employees. On the contrary, it seems to me that what happens to the others must be relevant. It may be that in some cases there will be special circumstances applying to other employees which will affect the weight to be given to evidence about them. Clearly the circumstances concerning some employees are likely to be more similar to those of a party seeking to use them in a particular case than to those of other employees. The more closely similar the circumstances are the greater the relevance, and the less similar, then, the less useful the evidence will be. I do not see however, that it can ever be said to be necessarily irrelevant.

135 The matter before me does not involve an employee who has been terminated. But it does involve an employee, in this case the applicant, who has been dealt with by his employer in a particular way in relation to superannuation contributions that is directly at odds with the way the same employer dealt with another employee, namely Professor Dunkley who was, at the relevant time, in exactly the same circumstances as the applicant. In relation to the applicant and Professor Dunkley, they were each employed at or about the same time by the respondent in 1977 and 1978 respectively. They were both on the same salary and presumably other employment conditions relating to their position with the respondent - the applicant as Professor of Commerce and Professor Dunkley as Professor of Medical Biochemistry. The respondent did not suggest otherwise.

136 The applicant and Professor Dunkley (amongst others) over a period of time spanning the latter months of 1998 and 1999 exercised, as they perceived it, an election to increase their superannuation contributions. That election, in turn, resulted in the respondent increasing its contributions to twenty per cent, giving a total contribution to the fund of thirty per cent.

137 When the respondent made the decision, for the reasons already canvassed in detail, to reduce its superannuation contributions to UNSSS in relation to the applicant and Professor Dunkley, they were advised of that decision on the same day in March 2001. At those individual meetings, Professor Dunkley and his wife responded in a particular way.

138 In relation to the applicant there was a series of correspondence, the relevant contents of which have been earlier detailed.

139 I have already stated I am satisfied Professor Winsen did return to the University with the superannuation issue uppermost in his mind. I believe he did not do so happily as far as he perceived his ongoing employment with the respondent. But I am also persuaded that he was, at that time of his life, very much influenced by superannuation benefits as a significant factor in his future employment planning. That approach is no different, it would seem, to that taken by Professor Dunkley. He (Professor Dunkley) turned down an alternative employment opportunity on a greater salary, but did so solely because of the increased superannuation contributions.

140 Where I believe the respondent created an unfairness as far as the applicant was concerned, was the decision it took to reverse its decision in relation to Professor Dunkley for the reasons it has given. That is a factor I cannot ignore given that all other things are equal as between the applicant and Professor Dunkley. On that point, I accept the submission of counsel on behalf of the applicant that the question of attracting research funding forms no part of any contract or arrangement between the University and Professor Winsen and/or Professor Dunkley in relation to the respondent's obligations concerning superannuation contributions. As a consequence, I do consider it is relevant, in considering whether the applicant was treated unfairly, to consider how Professor Dunkley, as an employee in comparable circumstances, was treated in relation to the same issue.

141 I am satisfied that when the respondent made the decision it did to treat Professor Dunkley in the way it did, differently from the applicant and for the reasons it now proffers, the contractual arrangement between the applicant and the respondent became unfair. It became unfair because it permitted a contractual inequity to arise as between the applicant and Professor Dunkley for reasons and in circumstances that were not objectively defensible and which adversely impacted on the applicant. In that sense, the respondent failed to provide a comparable approach whereby employees would be treated the same with no differential in employer contributions unless objectively defensible foundations for such differentials existed. That is not the case here.

142 Having formed the view that the contract as between the applicant and the respondent became unfair it is necessary now to determine, in the exercise of my discretion, what relief should be granted. The applicant seeks an order that the contract be varied to include the term that should the applicant make a contribution of ten per cent of his salary to the University of Newcastle Staff Superannuation Scheme, or any superannuation scheme that replaces that Scheme, then the respondent will contribute twenty per cent of the applicant's salary to the same superannuation scheme and shall continue to contribute such twenty per cent of the applicant's salary to the said superannuation scheme for as long as the applicant continues to contribute ten per cent of his salary to the said superannuation scheme.

143 There was no evidence before me as to how long the applicant intends to continue to contribute ten per cent of his salary to the superannuation scheme of which he is currently a member. Certainly, the applicant gave no evidence of what his intentions were in that regard. As earlier indicated, UNSSS has been closed as a superannuation scheme and the superannuation account of the applicant along with other employees of the respondent has been transferred to UniSuper. As I understand it, currently the respondent is paying ten per cent of the applicant's salary to that scheme and the applicant continues to contribute ten per cent to that Scheme.

144 The only evidence I have before me as to the possible length of time the applicant may continue to contribute ten per cent of his salary to the scheme is the affidavit evidence of Mr Penfold. That evidence states that the average retirement age of persons such as the applicant would be sixty five.

145 The decision to reduce the superannuation contributions was made on and from 8 June 2001 when the applicant was fifty five years of age. He is now fifty eight. In exercising the discretion available to me by way of relief, having regard to the unfairness found, I do take into account the ongoing financial obligation that would be imposed on the respondent if I was to make the order in the terms as sought by the applicant. In all the circumstances, I believe that the unfairness that I have found can be properly compensated by a variation to underpin the requirement to pay going forward and a money order in relation to the period from 8 June 2001 to the present that requires the respondent to contribute twenty per cent of the applicant's salary to the relevant superannuation scheme for a period of five years from the date on which they ceased the increased contributions, that is, 8 June 2001.

146 At first blush it might be questioned why I do not place the applicant in exactly the same position as Professor Dunkley, all other things being equal. I do not agree with the decision taken by the respondent to maintain its twenty per cent contribution to Professor Dunkley for the reasons it did and in the open ended way that it did. Accordingly, in exercising the discretion available to me, I have done so in a way I believe is fair and just in all the circumstances between the parties.

147 Accordingly, notwithstanding anything contained in the Trust Deed, an order should be made that the contract between the applicant and the respondent be varied to include the term that for a period of five years starting from 8 June 2001, whenever the applicant makes a contribution of ten per cent of his salary to the University of Newcastle Staff Superannuation Scheme, or any superannuation scheme that replaces or has replaced that Scheme, then the respondent will contribute twenty per cent of the applicant's salary to the same superannuation scheme.

148 I also order the respondent pay interest in accordance with the Supreme Court Act 1970 and that the respondent pay the applicant's costs of the proceedings before me as agreed or as assessed in accordance with the Rules of the Court.

149 I request the parties file orders in accordance with the decision I have made within twenty eight days from the date of judgment.

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