Karzi v Toll Pty Ltd

Solicitors: Gerard Malouf & Partners (Appellant) Colin Biggers & Paisley Lawyers (Respondent) File Number(s): 2023/292793 Decision under appeal Court or tribunal: District Court Jurisdiction: Civil Date of Decision: 22 August 2023 Before: Olsson SC DCJ File Number(s): 2019/261712

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

HEADNOTE [This headnote is not to be read as part of the judgment] Mohd Younas Karzi (the appellant) was employed by Toll Pty Ltd (the respondent) at their depot in Erskineville. On several occasions between September 2014 and January 2015 one of the respondent's employees, Joseph Johnpulle, made offensive and racist remarks to the appellant. The appellant reported the matter to more senior employees of the respondent and, following an investigation of Mr Johnpulle's conduct by the respondent, Mr Johnpulle was dismissed. In response to Mr Johnpulle's dismissal, members of the Transport Workers' Union (TWU) protested about the appellant's presence at the Erskineville depot. As a result he was transferred to the respondent's Mascot depot. Later that year, in 2015, the appellant's visa application was refused and the appellant injured his lower back, both of which prevented him continuing to work for the respondent. The appellant brought proceedings in the District Court against the respondent for damages in negligence for psychiatric injury. Olsson SC DCJ (the primary judge) dismissed the appellant's claim, finding that while the respondent owed the appellant a duty of care to protect him from the risk of psychiatric injury caused by its employees, the risk of harm was not reasonably foreseeable, the respondent did not breach its duty of care and, even if liability was established, the appellant was not entitled to damages as he was not entitled to work in Australia and his earning capacity was substantially reduced as a result of his back injury. The appellant appealed. In addition to challenging a number of the primary judge's factual findings, the key issues on appeal were whether the primary judge erred in: (1) finding the risk of psychiatric harm was not reasonably foreseeable; (2) finding the respondent had not breached its duty of care to the appellant; (3) failing to address the appellant's case on vicarious liability; (4) finding the appellant's psychiatric injury was transient; and (5) admitting the evidence of Maxine Prince, a witness who was not referred to in the respondent's pre-filing defence. The Court (Adamson JA, Leeming JA and Basten AJA agreeing, Leeming JA and Basten AJA giving separate reasons) held, dismissing the appeal: Challenges to primary judge's findings of fact (1) The primary judge was correct to prefer the evidence of the respondent, which included well-documented evidence of its investigations, to that of the appellant having regard to her Honour's credibility findings against the appellant: at [1] (Leeming JA); [58], [69], [74], [82] (Adamson JA). Reasonable foreseeability of psychiatric harm per Adamson JA (2) There was nothing in the nature and extent of the appellant's work itself which gave rise to a risk of psychiatric harm. Whether the respondent ought to have foreseen that the appellant would suffer psychiatric harm depended on whether the appellant gave any indication to this effect: at [102], [104]-[106]. Vairy v Wyong Shire Council (2005) 223 CLR 422; [2005] HCA 62; Koehler v Cerebos (Australia) Pty Limited (2005) 222 CLR 44; [2005] HCA 15, applied. Kozarov v State of Victoria (2022) 273 CLR 115; [2022] HCA 12; Stevens v DP World Melbourne Ltd [2022] VSCA 285, considered. (3) The primary judge was correct to find, in circumstances where the appellant did not complain, or exhibit any signs, of psychological harm, that it was not reasonably foreseeable from the respondent's point of view that there was a risk of psychological harm: at [112]. Reasonable foreseeability of psychiatric harm per Basten AJA (4) While the appeal should be dismissed solely on the ground that no breach of duty of care was established, inconsistencies in the primary judge's findings suggest there was substance to the appellant's submission that the respondent was put on notice that he was at risk of psychiatric injury. It should have been inferred that the respondent took the steps that it did (relocating the appellant and taking disciplinary action against Mr Johnpulle) to avoid a risk of harm of which its officers were self-evidently aware: at [169]-[172]. Breach of duty (5) By dismissing Mr Johnpulle and referring the issue with the TWU to mediation the respondent did all that it reasonably could to resolve the issue. No breach was made out: at [1] (Leeming JA); [117] (Adamson JA); [173]-[175] (Basten AJA). Vicarious liability (6) In circumstances where the issue of vicarious liability was not pleaded by the appellant in the Court below, the appellant's criticism of the primary judge for not ruling on the issue is unwarranted: at [7] (Leeming JA); [130]-[134] (Adamson JA); [176]-[178] (Basten AJA). Dare v Pulham (1982) 148 CLR 658 at 664 (Murphy, Wilson, Brennan, Deane and Dawson JJ); [1982] HCA 70, applied. Transience of psychiatric injury (7) Section 326 of the Workplace Injury Management and Workers Compensation Act 1998 (NSW) is not conclusive evidence that a psychiatric injury in respect of which a Workers Compensation Commission certificate is issued is permanent for the purpose of determining causation in negligence. The primary judge was entitled to find the appellant's psychiatric injury was transient: at [1] (Leeming JA); [139] (Adamson JA). Evidence of Ms Prince (8) No error was established in the primary judge's admission of this evidence. The respondent's omission of Ms Prince from its pre-filing defence was a direct consequence of the appellant's failure to allege negligence in relation to his transfer to Mascot on his pre-filing statement: at [1] (Leeming JA); [143]-[144], [156]-[158] (Adamson JA).

JUDGMENT

1. LEEMING JA: I agree with Adamson JA that this appeal must be dismissed with costs. As Basten AJA explains, the conclusion that Toll was not itself in breach of duty is a sufficient answer to the entirety of the claim made by Mr Karzi against it directly, and I agree, for the reasons given by each of Adamson JA and Basten AJA, that the challenges to that conclusion and to the factual findings which lead to that conclusion fail. I also agree with Adamson JA, for the reasons her Honour gives, that there was no error in admitting the evidence of Ms Prince, and that nothing turns on the failure by the primary judge to quantify damages, contrary to the ordinary practice. It is not necessary to express a view concerning the challenges to the findings of foreseeability and causation.
2. I wish to add two points by way of elaboration, and I shall do so without repeating the background contained in Adamson JA's reasons. The first relates to what, in substance, was a threshold submission advanced on behalf of the appellant concerning the duty owed by an employer to an employee. Mr Karzi's submission drew upon what had been said in Stevens v DP World Melbourne Ltd [2022] VSCA 285. The critical paragraphs of that appeal, which, like the present, concerned breach by an employer of its duty of care owed to employees in respect of their incurring psychiatric injury, were at [58]-[59]: His Honour's judgment was delivered prior to the High Court's decision in Kozarov and this Court's decision in Bersee. As Kozarov and Bersee explain, in a case where the risk of psychiatric injury from the performance of work is acknowledged by the parties, evident signs of distress or vulnerability on the part of a particular employee are not a precondition that must be satisfied before psychiatric injury can be found to be reasonably foreseeable. In the present case, what was critical was not whether the plaintiff exhibited evident signs of distress or vulnerability, but rather whether the defendant took reasonable care to avoid an acknowledged reasonably foreseeable risk of psychiatric injury being caused by the plaintiff's treatment by fellow workers in the workplace. It follows that, to the extent that the judge rejected the plaintiff's claim on the basis that the plaintiff did not manifest evident signs of distress or vulnerability, his Honour erred. (Footnote omitted.)
3. Drawing upon the words "is acknowledged by the parties" in [58] and "an acknowledged reasonably foreseeable risk of psychiatric injury" in [59], Mr Karzi submitted that in the present appeal, there was an acknowledgement of such risk of psychiatric injury, in the form of the formal policies in place in the workplaces. I do not accept that submission. It is an example of reading the reasons for judgment literally and out of context. Nothing in Stevens denies that "the fundamental question" is "whether at some point of time during [the] employment the risk of that type of injury should have been foreseen by the defendant": see at [54]. The reference in Stevens to "an acknowledged reasonably foreseeable risk" was a reference not to the existence of documents concerning workplace conduct but to the four years of serious and widespread bullying, known to management, which had occurred in what was euphemistically described as a "robust workplace environment which was not for the faint-hearted".

The factual background

1. The appellant was born in Afghanistan in April 1982. In 1995, he and his family went to Pakistan as refugees. In about 1999, he migrated with his family to Canada. He became a Canadian citizen in about 2003. In 2010, he met Hasna Tania Fath on the internet and married her in January 2012 in Canada. Ms Fath is an Australian citizen. She was previously married to Elmoustafa Fath, whom she had also sponsored to come to Australia and with whom she had two children.
2. In October 2012, the appellant was granted a subclass 976 visa by the Department of Immigration and Border Protection (the Department) and entered Australia where he lived with Ms Fath and her two children. In February 2013, Ms Fath sponsored the appellant for a partner visa. Pending the determination of his application (which was ultimately refused in August 2015 as Ms Fath had, by then, withdrawn her sponsorship of him), he was permitted to work in Australia.
3. In 2013, the respondent employed the appellant as a dock-hand at its Erskineville depot where he worked on the afternoon shift processing ingoing and outgoing freight for international and domestic transport. In January 2014, the appellant became a member of the Transport Workers' Union (TWU).

The September 2014 interchange

1. In about September 2014, another employee, Joseph Johnpulle, made comments to the appellant about Al Qaeda destroying the Twin Towers in New York on 11 September 2001. The appellant found the comments "most offensive and unwelcome" and asked him not to talk to him about it. Mr Johnpulle said, "okay, I'm just telling you".

The early November 2014 interchange which was reported to Mr Fath

1. In early November 2014, Mr Johnpulle made similar comments to the appellant and showed him a video posted by the Taliban which showed what the primary judge described as "particularly abhorrent material". The appellant decided to report the matter to James Hewlett, the Operations Manager of Imports. As Mr Hewlett was not available, the appellant complained about Mr Johnpulle to Mr Fath (the appellant's wife's ex-husband), who happened to be his team leader. Neither Mr Fath nor Mr Johnpulle gave evidence but the primary judge relied on the terms of the letter of dismissal sent to Mr Johnpulle on 9 February 2015 (see below), which her Honour considered to be "factually correct".

The interchange on 19 or 20 November 2014 which was not reported to Mr Fath

1. Mr Johnpulle made similar comments to the appellant on 19 or 20 November 2014 but, according to the letter of dismissal, the appellant did not report those comments to Mr Fath on that occasion.

The interchange on 7 January 2015 which was reported to Mr Hewlett

1. Notwithstanding his assurances to Mr Fath, Mr Johnpulle made further comments of a similar nature to the appellant on 7 January 2015, in circumstances where the appellant felt that Mr Johnpulle was so physically proximate as to be "in his face". On the same day, the appellant reported what had occurred to Mr Hewlett.
2. The appellant's evidence was that, when he reported the matter to Mr Hewlett, he was "crying and upset". Mr Hewlett recalled that the appellant was "calm" about it. The primary judge said: "34 Mr Hewlett gave evidence that 7 January was the first time Mr Karzi spoke to him about the matter. He was told that Mr Johnpulle 'verbally attacked' and made 'some racial remarks' to Mr Karzi. 35 Contrary to Mr Karzi's evidence that he was demonstrably upset during the course of the conversation, Mr Hewlett remarked that he was calm about it. 36 Mr Hewlett was firm in his evidence that at all times Mr Karzi appeared to be concerned but not upset or distressed. He specifically denied that Mr Karzi was crying. 37 With respect to Mr Karzi's demeanour, I note that a file note was in evidence by a person named Philip James dated 7 January at 5pm. It referred to the various comments said to have been made by Mr Johnpulle and continued: 'Younis has advised he will not tolerate such conversation again & wants this dealt with immediately by Toll. Younas has advised he will be seeking TWU & legal advice as apparently this is not the first time he has been spoken to by Joseph like this. He appeared very upset'. 38 Mr James did not give evidence; the time and date indicated that the email was prepared at or shortly after the meeting with Mr Hewlett, but there was no elucidation as to what he meant by "very upset". 39 Mr Karzi did not ask for, or take, any time off, nor did he voice any other concerns to Mr Hewlett, nevertheless, as part of the usual procedure, he told Mr Karzi about the Employee Assistance Programme (EAP) and noted that there were signs around the premises which advised its contact details. He also gave him the details of a Chaplaincy service which Mr Karzi could approach."
3. Mr Hewlett spoke to both the appellant and Mr Johnpulle and asked them to put their positions in writing (the appellant's statement bearing the date 12 January 2015 but signed and dated 11 March 2015 formed part of his evidence in chief). Mr Hewlett subsequently consulted the respondent's Head of Human Resources, Emila Cvetkovic, and the respondent's acting manager for New South Wales, Joshua Peacock. The respondent investigated Mr Johnpulle's conduct.

The show cause letter to Mr Johnpulle dated 16 January 2015

1. On 16 January 2015, the respondent wrote a show cause letter to Mr Johnpulle detailing the appellant's complaint and asking Mr Johnpulle to provide a written response as to why his employment ought not be terminated (the terms of this letter is referred to in detail below) (the show cause letter). Later in January 2015, delegates of the TWU asked the appellant to withdraw his complaint against Mr Johnpulle but he refused to do so.

The dismissal of Mr Johnpulle by letter dated 9 February 2015

1. As a result of the investigation, Mr Johnpulle's employment was terminated. His letter of dismissal dated 9 February 2015 reiterated the allegations from the show cause letter and was relied on by the primary judge as a contemporaneous document which was reliable (the dismissal letter).
2. Mr Johnpulle's challenge to his dismissal in the Fair Work Commission (FWC) failed although he was subsequently reinstated (after the appellant had stopped work due to his back injury).

The TWU protest on 17 February 2015

1. On 17 February 2015, members of the TWU protested about the appellant's presence at the Erskineville depot, claiming that he was a risk to their health and safety. Mr Hewlett and Mr Peacock gave evidence that the TWU was prohibited from taking industrial action in response to the dismissal of one of its members and, therefore, the TWU chose to characterise its protest in a way which, by emphasising the appellant's behaviour, appeared to be legitimate. As the respondent could not order the TWU not to take action, it referred the matter to FWC for resolution.

The appellant's first transfer to the Mascot depot

1. In mid-February 2015, with a view to defusing the conflict, Mr Peacock told the appellant that he would be transferred to the Mascot depot (the closest depot to Erskineville), which was run by a company related to the respondent. A position was created for the appellant for that purpose. Mr McCulloch SC, who appeared with Mr Doak for the respondent, accepted that the respondent's commercial interest in the smooth operations of its Erskineville depot were advanced by this transfer.
2. The primary judge noted the conflict between the appellant's evidence that he was very upset and broke down at the news of his transfer and the evidence of Mr Peacock and Ms Cvetkovic, which was that the appellant did not complain and that his attitude was "stoic". Mr Peacock told the appellant that the respondent was there to support all of its employees, whether permanent or casual. His impression was that the appellant was "quite pleased and happy that he was being heard and that [the respondent was] following due process". Her Honour accepted Ms Cvetkovic's evidence that if the appellant had shown any distress, she would have provided him with support.

The appellant's first return to the Erskineville depot

1. The appellant worked at the Mascot depot until about 16 March 2015, following which he was transferred back to the Erskineville depot to work in Freight Solutions. The TWU reiterated its complaints about the appellant.

The appellant's transfer to the Mascot depot

1. As a result of the TWU's ongoing complaints, the appellant was moved back to the Mascot depot where he worked until April 2015.

The appellant's second return to the Erskineville depot

1. The respondent agreed with the TWU that the dispute concerning the appellant would be mediated by Mr Harrison, a former member of the NSW Industrial Relations Commission. Pursuant to the mediated agreement, the appellant resumed work as a permanent employee (he had previously been casual) at the Erskineville depot in Freight Solutions.
2. There was a conflict in the evidence about the appellant's response to his move to Freight Solutions at the Erskineville depot. The appellant said that he was very unhappy and depressed and had to work alone in a "small cage" which was "no bigger than a dining room" where he had no contact with anyone else and no access to communal facilities. He said that he found working there "dehumanizing" and "humiliating". The primary judge was not satisfied that the appellant's version of the conditions or the workplace was accurate, finding that it was "considerably embellished".
3. The appellant's evidence was contradicted by that of Maxine Prince, the supervisor of Freight Solutions at the Erskineville depot from at least January 2015. She described an outside area of about 150m x 150m ("half a football field") which was surrounded by a cyclone fence to secure bonded and sensitive goods and goods which could not yet be delivered, which was adjacent to an office area. At any one time, of the eight employees on shift in the unit, four would be in the outside area and four would be in the office. There was a toilet in the outside area as well as in an adjacent building. Ms Prince observed that the appellant was a good worker who got on with his colleagues and showed no indication that he was struggling with issues to do with his mental health. He did not complain to her or seek to be transferred out of the unit. Nor did he seek time off or take sick leave.

Ms Fath's withdrawal of sponsorship

1. In July 2015, Ms Fath withdrew her visa sponsorship of the appellant, as a result of which the Department required him to show cause why his application for a partner visa (which was still pending) ought not be refused. His application was refused on 25 August 2015. The appellant sought a review of the refusal in the Administrative Appeals Tribunal (AAT) and also applied for permanent residency. The appellant argued that Ms Fath withdrew her sponsorship of him because of the psychiatric injury he had sustained and, thus, his damages should be assessed on the basis that, but for the psychiatric injury, the sponsorship would have continued and he would have become a permanent resident. This matter is relevant only to the assessment of damages which, in light of my conclusion on liability, does not arise.
2. From April 2015, the appellant continued to work in Freight Solutions at the Erskineville depot without complaint or time off until he injured his lower back on 9 November 2015 and stopped work. At the time of the proceedings before the primary judge, he had not resumed work.
3. On 21 November 2015 the appellant lodged a workers compensation claim in respect of psychiatric injury.
4. On 3 March 2016, the AAT affirmed the Department's refusal of the appellant's applications for a partner visa and permanent residency, with the consequence that he could no longer legally work in Australia.

The primary judge's findings about the appellant's evidence

1. The primary judge addressed the inconsistencies in the appellant's evidence. She noted that the appellant denied that he knew that Ms Fath had been married to his supervisor, Mr Fath, although he referred to their son in his visa applications and would often give Mr Fath a lift home.
2. The primary judge found: "94 There was nothing in [the applicant's] conduct which either expressly or impliedly indicated that he was suffering mental stress in late 2014 - early 2015: he followed the dispute resolution process; he did not advance a further complaint of any sort between November 2014 and February 2015; he did not attend a medical practitioner (or if he did, there was no evidence about it); he did not seek, nor take, time off work. 95 He made no further complaint. He did not consult a medical practitioner (other than one visit to his general practitioner on 19 February 2015) until his back injury."
3. The primary judge also recounted the inconsistent history given by the appellant to various doctors as well as the contents of his statement dated 11 March 2015 (which was not provided to the respondent until 21 December 2015) in which he expressed a desire to claim $5 million from the TWU "for damages they caused to [his] life and [his] family". The statement contained various passages which indicated that the respondent's supervisory staff were supportive of the appellant and had sought to assist him. For example, Mr Peacock had driven the appellant to the Mascot depot in a company vehicle and, on arrival, Mr Hewlett instructed "Andy" to look after him because he is "very reliable and a good man".
4. The primary judge was satisfied that the respondent "responded immediately, courteously and thoughtfully to the complaint" and said, "[i]t is difficult to see what other measures [the respondent] could have taken". Her Honour found that the appellant had suffered a psychiatric injury but that it had been sustained after the abuse by Mr Johnpulle and the appellant blamed the TWU, not the respondent, for his depression and anxiety.
5. The primary judge noted that the appellant told his treating psychologist, Ingrid Peters, that he was concerned that "getting better psychologically may damage his legal and work cover arrangement" (the appellant was being supported by workers compensation payments which became even more important after 3 March 2016 when he could no longer legally work in Australia). The primary judge noted that Ms Peters said, when reviewing the results of three psychometric assessments which the appellant had undertaken, that the results were in such an "extreme range so as to suggest considerable distortion", which rendered the results invalid. Dr Jonathan Phillips, psychiatrist, expressed a similar view.

The primary judge's legal analysis of the plaintiff's claim

1. The respondent accepted that, as the appellant's employer, it owed him a duty of care. The risk of harm was the risk of psychological injury caused by the actions of the respondent's other employees.
2. The primary judge was not satisfied that, when the appellant reported Mr Johnpulle's comments to Mr Fath on a single occasion in early November 2014, the respondent ought to have known that the issue was other than interpersonal or that there was a risk of psychiatric harm to the appellant.
3. Her Honour said: "146 The plaintiff reported Mr Johnpulle's comments to the leading-hand, Mr Fath in late 2014. He said he felt 'stressed' and unhappy. 147 There is no evidence to corroborate that assertion but that is not to say that the plaintiff ought to be disbelieved. 148 The objective evidence is supportive of the matter being relatively minor. Mr Karzi continued working without taking any time off. 149 As Chief Justice Spigelman said in Naidu (at 39), "there is no scope for extending the doctrine of constructive knowledge so as to encompass all the employees of a company. To do so would be, in substance, to impose a duty on all organisations to establish elaborate systems of inquiry and investigation which are truly burdensome." 150 That statement has considerable force in the context of a leading hand in a transport depot of a multinational company. 151 In my assessment, at that stage, the issue was interpersonal and not sufficient to establish that the defendant knew or ought to have known that there was risk of psychiatric harm to the plaintiff and I so find." (Emphasis in original.)
4. As to the complaint to Mr Hewlett on 7 January 2015, the primary judge found that the evidence did not support a finding that there was, at that time, a reasonably foreseeable risk of psychiatric harm.
5. As to the effect on the appellant of the TWU's protest on 17 February 2015, the primary judge accepted the evidence of Mr Peacock and Ms Cvetkovic that the appellant was calm when he learned that he was to be transferred to the Mascot depot. Although the primary judge found that the appellant developed "a psychiatric injury of a transient nature following the activities of the TWU and its delegates", her Honour found that the risk of psychiatric injury to the appellant was not reasonably foreseeable by the respondent at this time. The primary judge was not satisfied that this transient psychiatric injury was the cause of his breakdown at the end of 2015.

The primary judge's findings on damages

1. The primary judge found, at [197], that the medical evidence largely supported the conclusion that the appellant suffers from a psychiatric injury and is incapacitated for work. Her Honour also said, at [198], that "[t]here was evidence that the [appellant's] psychiatric condition was caused, in part by the effects of the back injury and the stress of his immigration status."
2. The primary judge was not satisfied that the appellant was entitled to damages other than for his back injury, which was the subject of a separate claim for workers compensation. Her Honour noted that the appellant neither took time off nor sought medical assistance between February 2015 and November 2015 and "therefore suffered no loss". The primary judge said that the evidence which had been adduced covering the period from 3 March 2016 when the appellant's visa was cancelled did not enable her to assess any damages.

Challenges to findings of fact

1. The appellant has filed a statement pursuant to Uniform Civil Procedure Rules 2005 (NSW), r 51.36(2), which identifies the challenges made to the primary judge's findings of fact. It is convenient to address these, in chronological order (rather than the order in which they appear in the statement) before turning to the grounds affected by those challenges.

The primary judge's failure to make an express finding as to the number of times the appellant complained to Mr Fath in November 2014 about Mr Johnpulle's conduct

1. The appellant submitted that the primary judge did not make an express finding as to how many times he reported Mr Johnpulle's conduct to Mr Fath, although her Honour found that he had complained to Mr Fath in November 2014 but not in September or December 2014. The appellant submitted that the show cause letter and the dismissal letter supported the appellant's contention that he complained to Mr Fath twice in November 2014 and that the primary judge ought to have made such a finding on that basis.
2. The show cause letter and the dismissal letter are in relevantly similar terms. Each contains four allegations as follows: 1. Mr Johnpulle engaged in verbal conduct towards the appellant contrary to the respondent's Code of Practice - Workplace Behaviours (the code) on 7 January 2015; 2. Mr Johnpulle engaged in verbal conduct towards the appellant on about 24 or 25 September 2014 contrary to the code (which was not said to be the subject of complaint); 3. Mr Johnpulle engaged in verbal conduct towards the appellant contrary to the code in early November 2014 which included the following particulars, c and d of which concern the appellant's complaint to Mr Fath: "Particulars to Allegation 3: a. On an occasion when Younas was outside the Bond area, releasing the bond, you approached Younas and said to him words to the effect 'Younas, it's good what the Taliban did to America. Look what they are doing to the Afghan people', b. You walked away from Younas after he said to you 'Joe, I have said to you before that I don't want to talk about this kind of thing. It has nothing to do with me. I am here to do my job.' c. After Younas complained to the leading hand, Mostafa Fath, about your comments to him, Mostafa said to you words to the effect 'I don't want you to talk to Younas about the war or anything like that. We are here to do the job, not to talk. Rubbish'. In response, you said to Mostafa words to the effect 'OK, I was just joking with him'. d. When Mostafa responded to you 'No, he doesn't like to hear or talk about this rubbish' you said words to the effect 'OK, I won't say it again.'" 1. Mr Johnpulle engaged in verbal conduct towards the appellant contrary to the code on about 19 or 20 November 2014. The particulars to the fourth allegation do not include any reference to the appellant having complained to Mr Fath on that occasion but merely said: "Particulars to Allegation 4: a. At approximately 3:10pm while Younas was doing the customs scanning and you were scanning the satchels for him, you said to Younas words to the effect 'Oh Younas, last night I watched a video. The Taliban was killing someone'. b. When Younas reminded you that you had said you would not make such comments again, you said words to the effect 'OK, sorry.'"

The primary judge's finding that Mr Fath was not a person authorised to receive the appellant's complaint

1. The appellant challenged the primary judge's alleged finding that Mr Fath was not a person authorised to receive his complaint. In support of this submission, Mr Parker relied on paragraphs [149]-[150] extracted above.
2. Mr Parker submitted that her Honour ought to have accepted Mr Hewlett's evidence that Mr Fath, as the appellant's team leader and leading hand, was authorised to receive his complaint and required to act on it by escalating it to his supervisor. Mr Parker relied on his cross-examination of Mr Hewlett as follows: "Q. And you established, did you not, that although Mr [Johnpulle] had indicated that he would respond and desist from the conduct that he was engaged in, in relation to Mr Karzi, he did not do so; correct? A. That's correct. Q. He didn't respond to the undertaking he'd given to Mr Fath? A. That's correct. Q. Now, under the Code, Mr Fath should have escalated the complaint to a higher level, shouldn't he? A. That's right. Q. When he didn't get a local response that was adequate, it should have been escalated, what, to you? A. To myself or the other operations manager. Q. Or another … supervisor? A. Correct. Yeah. Q. And that would have generated an investigation and more senior operatives responding to the behaviour? A. Yes. Q. Correct? And you agree with me, do you not, that one of the advantages of escalating it up the chain promptly like that is so it can be, as it were, nipped in the bud at an early point of time? A. Yes. Q. That's right? And that opportunity was lost, because Mr Fath, the leading hand, didn't escalate the complaint up the chain of command at an earlier point of time; correct? A. Yeah. Yeah. Yes. Q. And, indeed, Mr Fath never escalated it? A. No. Q. And that's contrary to the grievance policy, isn't it? A. Yes." (Emphasis added.)
3. Mr Parker also relied on the respondent's "Workplace Behaviours Standard" which included the Grievance Resolution policy (the Standard). He submitted that Mr Johnpulle's behaviour towards the appellant was "inappropriate behaviour" within the meaning of the Standard and that Mr Fath should have reported it to Mr Hewlett in November 2014. He submitted that this finding was erroneous as the respondent had a "clearly articulated published policy prohibiting bullying, harassment and racial vilification" which was "mandatory" and that, under the policy, Mr Fath was the appropriate person to whom such a complaint ought to have been made. He submitted that it was not open to Mr Fath to refrain from acting on the information as he was obliged by the policy to "escalate" that complaint by reporting it to Mr Hewlett.

The primary judge's finding that Mr Johnpulle's comments in 2014 were interpersonal and not sufficient to establish that there was a risk of psychiatric harm to the appellant

1. The primary judge found that in late 2014 the appellant reported Mr Johnpulle's comments to Mr Fath and told him that the comments made him feel "stressed" and unhappy. Her Honour found that the objective evidence supported the conclusion that the matter was "relatively minor" as the appellant had continued working without taking time off and that "the issue was interpersonal and not sufficient to establish that the defendant knew or ought to have known that there was risk of psychiatric harm to the plaintiff and I so find." (Emphasis in original).
2. Mr Parker submitted that it was apparent from the show cause letter and the dismissal letter that Mr Johnpulle's comments were "abhorrent and offensive" and that, although expert evidence was not necessary, Professor Tennant gave opinion evidence that such conduct comprising bullying and harassment on racial grounds could lead to psychological injury.
3. The question whether Mr Johnpulle's comments to the appellant gave rise to a risk of psychiatric harm to him needs to be answered by reference to the appellant himself since the comments themselves were not necessarily such as to pose a risk of psychiatric harm, as distinct from causing offence. The objective facts were that the appellant had complained once to Mr Fath (in early November 2014, see above) and that he was continuing to work to his usual standard, without further complaint or time off notwithstanding that he can be assumed to have had subsequent contact with Mr Johnpulle. In the absence of further complaint, it was reasonable for Mr Fath to assume that the matter had been resolved by his approach to Mr Johnpulle in early November 2014 following the complaint, that there had been no recurrence and the comments were "interpersonal" in that they required no further intervention on behalf of the respondent. The challenge to this finding has not been made out.

The primary judge's finding that, on 7 January 2015, the appellant appeared to be concerned but not upset or distressed

1. The appellant submitted that the primary judge's finding that the appellant was not demonstrably upset during the course of his conversation with Mr Hewlett on 7 January 2015 was erroneous and that the primary judge ought not to have accepted Mr Hewlett's oral evidence that the appellant appeared to be concerned but not upset or distressed. He submitted that the primary judge's findings were "influenced if not entirely based on the finding that [the email extracted at [37] of the primary judge's reasons - see above] was not authored by Mr Hewlett." The appellant submitted that the primary judge ought to have found that Mr Hewlett was the author of the note, that it represented an accurate record of the meeting and the appellant's emotional state, which was very upset.
2. Mr McCulloch accepted that the email extracted at [37] of the primary judge's reasons had been created by Mr Hewlett and comprised a contemporaneous note of their meeting on 7 January 2015. However, he submitted that this concession was not inconsistent with the primary judge's finding that the appellant appeared to be "calm" and "concerned but not upset or distressed".
3. Mr Hewlett, when asked how the appellant appeared to him when he approached him on 7 January 2015, said: "He just needed to make a complaint. He was quite calculated in what had been said and he seemed to recall what had been said so I asked him to make that clear by putting it in writing."
4. Mr Hewlett clarified in his evidence that by "calculated", he meant "calm".
5. Although the primary judge was, in light of Mr McCulloch's concession, wrong to find that the email (which served as a file note) was not Mr Hewlett's, the reference in the email to the appellant being "very upset" ought, in light of Mr Hewlett's evidence, be read as meaning aggrieved, rather than emotionally distressed or labile. When read in that way, the primary judge's finding that the appellant was concerned but not upset or distressed accorded with Mr Hewlett's oral evidence and with the gist of the email. Although the appellant's evidence was to the contrary (that he was crying), the primary judge was entitled to reject that evidence, having regard to her Honour's credibility findings against the appellant. This challenge has not been made out.

The primary judge's finding that the appellant had claimed that the "cage was constructed for him"

1. Mr Parker submitted that the primary judge was in error in finding that the appellant had claimed that the "cage was constructed for him" because the appellant had not said that. The finding challenged was at [61], in the context of the following paragraphs: "61 He was very unhappy and depressed about the move to Freight Solutions, notwithstanding that he had been made a full-time employee (rather than a casual). He said that a small 'cage' had been constructed for him and that he had to work in it alone, and have no contact with other employees. 62 Notwithstanding, he did not make any complaint or comment to the defendant that he was struggling with his work and could not perform that role. 63 He said that he was confined to working in a "cage", "no bigger than a dining room" and isolated from other workers. … 179 … (d) There was no complaint about the alleged 'cage'. Ms Prince's evidence was persuasive and logical. I find that the description given by the plaintiff of his workplace at Freight Solutions was grossly exaggerated: the cage was not built for him; it was not a small area; he was not isolated from other workers; he was not denied the opportunity to talk to other workers; he was not prevented from leaving it; he could go outside, he could go to the office area and to an occupational room on the floor above it." (Emphasis added.)
2. The appellant's statement that the cage was constructed for him appears most clearly from the report of Colleen Hirst, who had been the appellant's treating psychologist since 6 March 2017. In 2020, Ms Hirst was asked by the appellant's solicitors to prepare a report for the purposes of the litigation and her clinical notes and reports concerning the appellant were tendered by Mr Parker at first instance (they formed part of Exhibit G).
3. In her report dated 8 May 2020, Ms Hirst recorded the following history which had been given to her by the appellant concerning his transfer from the Erskineville depot to the Mascot depot and back again: "Mr Karzi stated that the big boss of Toll said 'Your life is in danger. We will move you to a different location. He stated he was taken, as a matter of urgency on the same day, from the depot in Erskineville to the depot in Mascot, for his own safety and protection. Mr Karzi stated he moved from Toll in Erskineville to Toll in Mascot. He worked in Mascot for approximately 1 month. The General Manager then said he could go back to his old job. Mr Karzi stated that when he went back to Toll in Erskineville, the union went on strike again. The next day his boss told him to go back to Toll in Mascot. In 3 weeks time Mr Karzi came back to Erskineville. They had constructed a cage for Mr Karzi to work in. This cage was made from some sort of wire meshing. He was made to work in this cage. He felt publicly humiliated. He was not allowed to leave the cage and he was not allowed to talk to anyone. The cage had a separate way to go to the offices and to the toilet. He was not allowed to go to the warehouse. Mr Karzi stated he was made to work in this cage for 6 months. He stated the experience was humiliating and he felt like he was being publicly punished. Mr Karzi stated that while he was working in this cage, he also injured his back from Lifting a heavy box. He stated he heard a 'crack' in his back and went to hospital by ambulance. He stated that an MRI showed he had damaged his back. This was on the 9th November 2015. This is when he stopped working." (Emphasis added.)

The primary judge's finding that the respondent's response to the risk that the appellant might suffer psychological harm was adequate

1. Mr Parker argued that this finding (at [109]) was contrary to the evidence of Professor Tennant, whom the primary judge accepted as follows: "108 Professor Christopher Tennant, psychiatrist, provided an expert report in which he opined that unless the employer is standing ready or someone in authority is standing ready to prevent an interaction occurring, it can never be prevented: it is the employer's response which is critical. 109 I am satisfied that the defendant responded immediately, courteously and thoughtfully to the complaint. It is difficult to see what other measures Toll could have taken."
2. Mr Parker relied on Professor Tennant's evidence that early intervention was essential to minimise the consequence of bullying. He submitted that Mr Fath delayed intervention by not reporting to Mr Hewlett the inappropriate conduct, which the appellant had reported to him in November 2014. He also submitted that the primary judge was in error in failing to act on the evidence that the appellant should have been permanently removed from the Erskineville depot. These aspects of the challenge will be addressed in turn.

Alleged delay in intervention

1. Mr Parker's submission that Mr Fath had caused a delay in the respondent intervening on the appellant's behalf was based on the proposition that he had received more than one complaint in November 2014 and that Mr Fath ought to have referred the matter to Mr Hewlett in November 2014 when he became aware of the recurrence of the conduct. As both these premises are erroneous for the reasons given above, there was no relevant delay in intervention.

The return to the Erskineville depot

1. I have set out above the disparity between the appellant's description of Freight Solutions and that given by other witnesses and her Honour's preference for that of other witnesses.
2. Mr Parker relied on passages from his cross-examination, including the following exchanges with Mr Hewlett: "Q. When he came back to work at Erskineville, he worked in this freight area? A. Freight solutions. Q. Special area. A. Yes. Q. The workforce and he were kept away from each other - the general workforce; is that right? A. He worked-- Q. He was isolated? A. He wasn't isolated. He was in a separate area. Q. He was in a separate area-- A. Yeah. Q. --but he was isolated from his previous colleagues and fellow employees; is that right? A. He was in a different area, yeah. … Q. As we've discussed, doubtless with the best motives from Toll? A. Yes."
3. The evidence established, as the primary judge found, that the appellant came back to work at the Erskineville depot and worked with different colleagues than those with whom he worked when his leading hand was Mr Fath and he had the interchanges with Mr Johnpulle. As referred to above, this solution was the result of a mediated agreement between the respondent and the TWU. The appellant made no complaint about returning to the Erskineville depot and continued to work consistently and well until his back injury in November 2015.
4. The appellant has failed to make out his challenge to the primary judge's factual finding that the respondent's response was adequate.

The primary judge's finding that the psychiatric injury was transient in nature and not causative of the breakdown

1. This finding will be addressed in the context of ground 11.

The finding that the appellant was not entitled to damages because he did not have a valid visa until March 2016

1. As this finding is related to ground 13, it will be considered with ground 13.

Grounds 1 and 2: alleged errors concerning duty and foreseeability of risk

1. Grounds 1 and 2, which can be addressed together, are as follows: "1 The Primary Judge erred in failing to find the Respondent as the employer owed the Appellant a duty to exercise reasonable care to avoid a foreseeable risk of psychiatric injury caused by the conduct of the Respondent's employees: (a) Mr Johnpulle, (b) Individual members of the Union (employees of the Defendant), (c) Protesting members of the Union (employees of the Defendant), (d) Mr Peacock bringing the Appellant back to Erskineville too early, or at all, and (e) The placement, said to be discriminatory, of the Appellant in the Freight Solutions area. 2 The Primary Judge erred in finding that the risk of psychiatric harm was not reasonably foreseeable to the Respondent (J[165] [172]). Particulars (a) Her Honour erred relying on Koehler v Cerebos (Australia) Ltd [2005] HCA 15 to inform herself on foreseeability instead of, and without reference to, the Appellant's articulated submissions referencing Kozarov v State of Victoria (2022) HCA 12. (b) Her Honour erred in finding that the Appellant's complaints to his Leading Hand, Mr Fath were of a minor interpersonal matter insufficient to establish that the Respondent knew or ought to have known that there was a risk of psychiatric harm. J[151]. (c) Her Honour erred in finding that the report to Mr Hewlett on the 7th January 2015 did not support a finding that the Respondent knew or ought to have known of a foreseeable risk of psychiatric harm to the Appellant (J[157]). (d) Her Honour erred in finding that the Appellant was required to report to the respondent that he was suffering workplace stress, adverse psychological symptoms or that he felt intimidated by the activities of the Union members at the workplace J[160][161]. (e) It was not necessary for Mr Karzi to complain about the Union activity or the Freight Solutions (J[179(c)] both of which were obvious and apparent to the Respondent. (f) The finding at J[153] that at the 7 January meeting with Mr Hewlett Mr Karzi merely appeared 'concerned' is wrong. (g) The Appellant complained about the Union activity in the statement dated 11 March 2015."

Ground 1

1. It is difficult to appreciate the gravamen of ground 1 from its terms in circumstances where the primary judge found that the respondent owed the appellant a duty of care as alleged. For this reason, ground 1 has not been made out, having regard to the primary judge's finding at [170].
2. I note for completeness that the appellant, relying on McLean v Tedman (1984) 155 CLR 306 at 311-312; [1984] HCA 60, submitted that the duty owed by the respondent to the appellant was non-delegable. So much may be accepted since the respondent was the appellant's employer and therefore their relationship fell into a well-established category of non-delegable duties. However, the significance of the duty being non-delegable is not raised by ground 1.

Ground 2

1. As to ground 2, the primary judge, in effect, found that, having regard to the reasonable precautions taken by the respondent, it was not reasonably foreseeable that there was a risk of psychiatric harm, in light of the appellant's presentation (as a willing, competent employee, who was not exhibiting psychiatric illness or taking time off or not managing at work).

Particular (a) of ground 2: failure to refer to Kozarov v State of Victoria

1. In his submissions (and in particular (a) to ground 2 in the notice of appeal), the appellant was critical of the primary judge for referring to the statements of principle in Koehler v Cerebos (Australia) Pty Limited (2005) 222 CLR 44; [2005] HCA 15 (Koehler) but not referring to what the High Court said in Kozarov v State of Victoria (2022) 273 CLR 115; [2022] HCA 12 (Kozarov). Mr Parker also relied heavily on the decision of the Victorian Court of Appeal in Stevens v DP World Melbourne Ltd [2022] VSCA 285 (Stevens) (to which the primary judge was not referred), which he contended ought be followed by this Court.
2. In Koehler, the plaintiff (who was the appellant) was employed for 24 hours a week as a sales representative to negotiate sales of her employer's products to independent supermarkets. She informed her employer that she could not visit all the stores stipulated within her weekly hours and made suggestions as to how the task could be performed within the time. The employer did not adopt her suggestions. Ultimately, the plaintiff suffered from a psycho-physical disorder which resulted in "pain amplification". The High Court dismissed her appeal. It held that the employer's duty of care to avoid psychiatric injury depended on the nature and extent of the employee's work and the indications given by the employee to the employer. It held that where there is no reason to suspect that, by performing duties under a contract of employment, the employee is at risk of psychiatric injury, the employer's employment requirements cannot amount to a breach of the duty of care to avoid causing psychiatric injury.
3. In Kozarov, the appellant (K) worked in the Specialist Sexual Offences Unit (SSOU) of the Victorian Office of Public Prosecutions (OPP). Before K's employment commenced, the SSOU had adopted a Vicarious Trauma Policy for the protection of the psychiatric health of its employees. K exhibited the signs of vicarious trauma and post-traumatic stress disorder (PTSD) such that, by the end of August 2011, a reasonable employer would have been aware of the heightened risk to K's psychological health and taken reasonable steps to ameliorate the risk, including by rotating K out of the SSOU, thereby avoiding the exacerbation of K's PTSD. On this basis, the State of Victoria was liable for damages in negligence to K.

Particulars (b), (c) and (f) to ground 2

1. These challenges to the primary judge's factual findings have been addressed above.

Particulars (d), (e) and (g) to ground 2

1. Mr Parker submitted that the effect of the primary judge's reasons at [160]-[161] was that her Honour found that the appellant was "required to report to the respondent that he was suffering workplace stress, adverse psychological symptoms or that he felt intimidated by the activities of the [TWU's] members at the workplace." Further, he submitted that it was not necessary for the appellant to complain about the TWU's conduct or the conditions at Freight Solutions (as he alleged her Honour found at [179(c)]) because they were obvious to the respondent. He also submitted that the appellant had in fact complained about the activity of the TWU in his statement of 11 March 2015.
2. The relevant passages from the primary judge's reasons are as follows: "160 In cross-examination he said that he was 'struggling' at work at that time but he did not report any workplace stress or adverse psychological symptoms to Toll employees and continued to perform his normal duties. In fact his response to the TWU officials was courteous but robust. He said: 'I stated that I was not comfortable with lying and claiming that I was not affected by or did not understand Mr Johnpulle's actions. I said to them words to the effect of, "Lies are the biggest threat to mankind. The truth always comes out".' 161 Whilst his evidence was that, as time went on, he felt intimidated by the Union, he did not report it. There was evidence that Mr Hewlett and possibly another senior management figure called the plaintiff away when they saw him with the Union delegates but it went no further than that and has no probative value. … 179 However, I will record the findings I would have made, had I found that the risk of harm was reasonably foreseeable. … (c) Moreover, there was no complaint by Mr Karzi about the Union, or Freight Solutions. In fact, there were no complaints from him from February until November, when he injured his back."
3. In his statement dated 11 March 2015, the appellant set out a detailed complaint against the TWU for its activities against him. The statement concluded: "I would like to put forward my claim to have this matter dealt with as a matter of priority and in the utmost confidence. I would like to claim a 5 million dollars law suit against the Transport Workers Union (TWU) New South Wales for damages they caused to my life as well as my family."

Ground 3: alleged failure in concluding that the respondent was not in breach of its duty of care to the appellant

1. In his written submissions, Mr Parker submitted that the primary judge relevantly made two errors: first, by failing to recognise that Mr Fath was obliged to escalate the matter to Mr Hewlett in November 2014, thus engaging the grievance resolution process; and, second, by not finding that the respondent was obliged to remove the appellant permanently from the Erskineville depot.
2. In support of the second matter, Mr Parker relied on the evidence of Professor Tennant. However, Professor Tennant accepted that the respondent had taken reasonable precautions in a timely way to avoid any harm to the appellant. Mr Parker also relied on the evidence of Ms Todd that the respondent ought to have removed the applicant permanently from the Erskineville depot.
3. The first alleged error has been addressed above. Mr Fath had no obligation to escalate the matter to Mr Hewlett when he had only received one complaint from the appellant and, as far as he knew, Mr Johnpulle would abide by his prohibition against speaking that way to the appellant.
4. As to the second matter, the difficulties which the appellant experienced at the Erskineville site were the consequence of Mr Johnpulle's conduct and the reaction of the TWU to disciplinary action and ultimately dismissal of Mr Johnpulle. By referring the matter to mediation on the basis that the TWU would accept the result, the respondent did all that it could reasonably do to resolve the issue. Following the appellant's return to the Erskineville depot pursuant to the mediated agreement, the appellant did not signal any difficulties to the respondent until November 2015 when he sustained the back injury. This ground is not made out.

Ground 10: alleged failure to address the appellant's case on vicarious liability

1. Mr Parker submitted that the appellant had argued at first instance that the respondent was vicariously liable for the conduct of Mr Johnpulle, Mr Fath and others of its employees who were members of the TWU and who engaged in industrial action against the appellant.
2. Mr Parker relied on the decision of CCIG Investments Pty Ltd v Schokman [2023] HCA 21; (2023) 97 ALJR 551 in which the High Court held that the employer was not vicariously liable for the acts of an employee, who urinated on another employee while he was asleep, because the act did not occur during the scope of employment. He submitted that the respondent was liable for the acts of Mr Johnpulle because his comments were made in the course of performing an authorised workplace task, namely talking to a co-worker.
3. Mr Parker submitted that the primary judge had failed to rule on whether vicarious liability needed to be pleaded and failed to address the appellant's case on vicarious liability. He accepted that, as no re-trial had been sought, this Court could address the issue itself.
4. Mr McCulloch submitted that, as vicarious liability had not been pleaded, the primary judge was correct not to address it. In response, Mr Parker submitted that if this Court considered that it ought to have been pleaded, he would apply to amend the statement of claim to add a claim that the respondent was vicariously liable to the appellant for the acts of Mr Johnpulle, Mr Fath and those of its employees who were members of the TWU and who engaged in protests against the appellant.

The references to vicarious liability in the Court below

1. In order to address this ground, it is necessary to appreciate the way in which the matter proceeded at first instance.
2. The issue of the respondent's potential vicarious liability is not apparent from the statement of claim. It first arose on 4 August 2022 in the course of Mr Parker's cross-examination of Mr Hewlett in the following exchange: "Q. So that you were conscious, in relation to Mr Karzi, that the union approach to him, to use a neutral expression, may involve Toll in a vicarious liability for its employees, do you understand that? DOAK: I object to that, your Honour. It's the witness is being asked to what to answer effectively a legal question, and there's no pleading of vicarious liability in this case. PARKER: That doesn't matter. It's statutory provided for. The statute provides that the employer's liable for the conduct of its employees, your Honour. HER HONOUR: You're right. I'll allow the question."
3. On 8 August 2022, the parties exchanged written submissions. The appellant's written submissions contained the following paragraph: "124 The employer is vicariously liable for the conduct of its workforce. It is vicariously liable for conduct by [Mr] Johnpulle and other members of the staff that bullied Mr Karzi: Nationwide News v Naidu (2008) 71 NSWLR 471."
4. On 16 March 2023 (following a lengthy adjournment), Mr Parker returned to the issue of vicarious liability in his oral submissions at first instance in the following passage: "PARKER: Your Honour, I wanted to deal firstly with the issue of [vicarious] liability. Your Honour, the actions of Mr Johnpullé in the course of employment were a direct and intentional tort to which [T]oll would be vicariously liable. Your Honour, the authority for that proposition is to be found in Nationwide News v Naidu (2007) 71 NSWLR 471, paras 87 and 88 of the judgment of the Spigelman CJ. Your Honour, the brief facts of Naidu were that Mr Chaloner was employed by Nationwide News as a security overseer, and Mr Naidu was employed by ISS. Chaloner bullied Mr Naidu, who suffered psychiatric injury. The Chief Justice said … at para 87, "I agree with Beasley JA that if Nationwide News was not directly liable for Mr Chaloner, Chaloner's acts, then it was vicariously liable". That's the same position here. What Mr Johnpullé did was in the course of his employment. At para 88, the Chief Justice quotes from New South Wales v Lepore, and says, for the reasons set out in the bullet points, "What Mr Chaloner's conduct was done in the sensible pursuit of the employer's business, or the apparent execution of the authority of the employer, held him out to have - made the employer vicariously liable" - so Nationwide News [is] "[v]icariously [l]iable". HER HONOUR: But did you plead vicarious liability? … PARKER: No, your Honour. It's not necessary to plead vicarious liability, it's a proposition of law. HER HONOUR: Go on."

Ground 11: alleged error in finding that the psychiatric injury was transient

1. In ground 11, the appellant alleged: "The Primary Judge was in error to conclude that the psychiatric injury which she accepted had been sustained was: (a) Only as a consequence the activities of the Union and its members, and (b) Was transient in nature (J[96]), and (c) Not causative of the breakdown at the end of 2015 (J[158]). (d) This finding was: (i) Unsupported by, or was contrary to the evidence; and inconsistent with the finding at J[197]. (ii) Contrary to the Medical Assessment Certificate . (iii) Contrary to the Respondent's admission that the Appellant had sustained a 20% whole person impairment."
2. The primary judge found, at [158]: "I accept that [the appellant] developed a psychiatric injury of a transient nature following the activities of the TWU and its delegates. I am not satisfied that it was causative of his breakdown at the end of 2015. My reasons are as follows: (i) He continued to work well and without complaint after February 2015 until the physical injury in November rendered him unfit for any work; (ii) He had ongoing disputes with [the Department] regarding his visa and entitlement to remain in Australia; (iii) His marriage had failed, and his wife - who had sponsored him to Australia - left for Pakistan and married again; (iv) He had no treatment for his mental health between February and November."
3. Mr Parker submitted that it was not open to the primary judge to find that the psychiatric injury was "of a transient nature" and did not cause his breakdown in late 2015. He submitted that the effect of s 326(a) of the Workplace Injury Management and Workers Compensation Act 1998 (NSW) (the 1998 Act) was that the certificate issued by the Workers Compensation Commission on 18 December 2018 certifying that the injury had caused 20% Whole Person Impairment (WPI) was conclusive as against the respondent and precluded it from alleging that the injury sustained was other than permanent.
4. Section 326 of the 1998 Act provides: "326 Status of medical assessments (1) An assessment certified in a medical assessment certificate pursuant to a medical assessment under this Part is conclusively presumed to be correct as to the following matters in any proceedings before a court or the Commission with which the certificate is concerned - (a) the degree of permanent impairment of the worker as a result of an injury, (b) whether any proportion of permanent impairment is due to any previous injury or pre-existing condition or abnormality, (c) the nature and extent of loss of hearing suffered by a worker, (d) whether impairment is permanent, (e) whether the degree of permanent impairment is fully ascertainable. (2) As to any other matter, the assessment certified is evidence (but not conclusive evidence) in any such proceedings."

Ground 12: alleged error in admitting the evidence of Ms Prince

1. In ground 12, the appellant alleged: "The Primary Judge erred when she admitted into evidence, over objection and contrary to s318(1)(d) of the [1998 Act], the evidence of Ms Maxine Prince when: (a) The Respondent did not disclose her name or particulars of the evidence of Ms Prince contrary to s. 318(1)(d), (b) Her Honour provided no reasons why she admitted the evidence, (c) The primary judge placed extensive and impermissible reliance on Ms Prince's evidence J[66]-[77], [123], [167]-[169], [179( d)-(g)], [193]."
2. In order to address ground 12, it is necessary to set out some background as to how the issue arose at first instance.
3. As required by s 315 of the 1998 Act, the appellant served a pre-filing statement, which included a proposed statement of claim (which accorded with the statement of claim which was actually filed). However, he did not file a statement of evidence on which he proposed to rely in support of his claim as required by s 315(1). Following provision of extensive particulars by the appellant, the respondent filed its pre-filing defence which responded to the appellant's statement of claim. The purpose of s 315 is to ensure substantial disclosure of the positions of the parties so that prospects of settlement can be fully explored before the proceedings are commenced: Wilkinson v Perisher Blue Pty Ltd [2012] NSWCA 250 at [11] (Hoeben JA, Campbell and Barrett JJA agreeing).
4. The proposed statement of claim (and the filed statement of claim) alleged that the appellant had sustained a psychiatric or psychological injury on or by 17 February 2015. No allegation of negligence was made which related to the appellant's transfer to the Mascot depot on that date or his return to the Erskineville depot to work in Freight Solutions.
5. For this reason, the respondent did not in its pre-filing defence refer to the evidence of Ms Prince since, on the appellant's then case, such evidence was not relevant.
6. The hearing before the primary judge commenced on 25 July 2022. In his opening, Mr Parker referred to Mr Peacock, in the context of his having directed the appellant to return to Mascot depot where he was working four hours a day from mid-March 2015 to mid-April 2015. According to the appellant, he broke down as a result of this exchange. Mr Peacock was not referred to in the appellant's pre-filing statement. When the primary judge raised this matter, Mr Parker said that he understood that Mr Peacock was to be called and could "respond to it one way or another".

Ground 13: alleged error in failing to quantify damages

1. Ground 13 alleges: "Having concluded that the medical evidence supported a conclusion that the Appellant suffered a psychiatric injury and was incapacitated for work, the Primary Judge was in error to failing to assess any damages, on a contingent basis."
2. It is not necessary to address this ground as I am not satisfied that any of the other grounds have been made out. Accordingly, there is no basis to disturb the primary judge's judgment for the respondent.

Proposed orders

1. For the reasons given above, I propose the following orders: 1. Dismiss the appeal. 2. Order the appellant to pay the respondent's costs of the appeal.
2. BASTEN AJA: I agree that this appeal should be dismissed with costs. That conclusion, however, may be justified on the narrow ground that no breach of the conceded duty of care was established.
3. Mr Karzi's claim for damages was based on the liability of his employer (the respondent) for bullying and harassment (and consequential workplace events) which occurred in its workplaces between approximately September 2014 and April 2015.
4. The claim depended on common law principles as modified by Pt 5 of the Workers Compensation Act 1987 (NSW). For present purposes, the modifications of the common law were limited to the requirement that Mr Karzi have suffered a degree of permanent impairment resulting from his injury assessed at 15% of whole person impairment: s 151H. Prior to the proceedings, he had obtained a medical assessment certificate establishing permanent impairment at 20% of whole person impairment. The duty of care was not limited in accordance with s 32 of the Civil Liability Act 2002 (NSW) to circumstances where the defendant ought to have foreseen that a person "of normal fortitude" might suffer a recognised psychiatric illness.

Assessing causation

1. Because there was no dispute as to the extent of his injury, nor that the injury was suffered otherwise than in the course of his employment, limited attention was given in the trial judgment to the nature of the injury, nor its development. As a result, aspects of the judge's reasoning were confusing. For example, the judge found that Mr Karzi developed "a psychiatric injury of a transient nature following the activities of the TWU and its delegates": at [158]. In that context the judge reasoned that Mr Karzi had "continued to work well and without complaint after February 2015 until the physical injury in November" and "had no treatment for his mental health between February and November".
2. This finding did not sit easily with the accepted existence of a significant workplace injury involving a recognized psychiatric illness. Nor was it appropriate to ascribe the causal element to activities of the union delegates as if that necessarily broke the causal link between the bullying and the injury. Where bullying or harassment by one co-worker results in action being taken by the employer to protect the victim, thereby triggering further bullying or harassment by other co-workers, there is no break in the causal chain between the initial unlawful activity and the consequent injury. The bullying by Mr Johnpulle was clearly a material contribution to the consequent psychiatric injury.
3. Further, care must be taken in downplaying a psychiatric injury because a person does not seek immediate medical attention, or take time off work or otherwise make a complaint. Careful attention should be paid to the medical evidence before such inferences are drawn. Further, the fact that a worker's complaint leads to disciplinary action against a co-worker, which in turn triggers action adverse to the victim by other co-workers and union delegates, may well discourage the victim from complaining again. Similarly, stoicism in continuing working does not necessarily belie a psychiatric injury.
4. Finally, the trial judge accepted that, in November 2014, the conduct complained of was "interpersonal": at [151]. If that adjective was intended to distinguish it from workplace activities which fell within an employee's duties, and thus diminish its relevance, it was misplaced. Bullying is inherently interpersonal, but no less damaging for that reason.

Indications of risk of harm

1. Secondly, on the appeal Mr Karzi challenged the acceptance by the trial judge of evidence that, in the course of his contact with supervisory staff, he did not demonstrate distress or serious discomfort, thereby not putting them on notice that he was at risk of a psychiatric injury. There was substance to this challenge. As the respondent accepted, there was a contemporaneous note by a senior officer, Mr Hewlett, that when he spoke with Mr Karzi on 7 January 2015 Mr Karzi "appeared very upset". The trial judge dismissed that evidence on the basis that "there was no elucidation as to what he meant by 'very upset'": at [38]. However, whatever the phrase meant, it was not consistent with Mr Hewlett's evidence that Mr Karzi was "calm" at the meeting and was not demonstrably upset: at [35].
2. There were other inconsistencies in the findings. In addressing steps taken by the company to relocate Mr Karzi to another site, both the respondent's acting State Manager (Mr Peacock) and its Head of Human Resources for the Region (Ms Cvetkovic) stated that Mr Karzi did not complain about the move and that his attitude was "stoic". Mr Peacock also stated that the situation was "serious and we were trying to help". Implicit in the acceptance of that evidence are two further inferences, namely that senior management at Toll had knowledge of both a "serious" situation, which warranted the steps being taken to protect Mr Karzi, and, by describing his attitude as "stoic", that he was suffering from the bullying. Observations in the judgment which tended to downplay the seriousness of the situation as known and understood by Toll were inconsistent with acceptance of the evidence its own senior officers and also with the objective circumstances as to the steps taken by the company in response. For example, the dismissal of the bully, who was a permanent employee, in order to protect the victim, a casual employee, was, predictably, likely to create a risk of industrial action which could disrupt the activities of the company, as in fact occurred. It should have been inferred that such steps would not have been taken unless the officers well-appreciated the risks to Mr Karzi's health.
3. Three findings by the trial judge, that (i) Mr Karzi's evidence that "he felt intimidated by the union" but did not "report it" (said to have "no probative value" at [161]), (ii) Mr Peacock had described Mr Karzi's attitude as "stoic" and Ms Cvetkovic had described him as being calm, and (iii) his general practitioner, whom he saw two days later on 19 February 2015 "did not record any history of the plaintiff crying or feeling at the meeting two days earlier", led the judge to a comfortable satisfaction that "the risk of psychiatric injury to Mr Karzi was not reasonably foreseeable" at that time: at [165]. Turning to the events of April 2015, the judge stated that the evidence "simply does not support a finding that the defendant ought to have been aware that the plaintiff was at risk of injury while working at Freight Solutions": at [169].

No breach of duty

1. The actions in fact taken by Toll were summarised by the judge in the following terms: "187 It acted immediately upon receiving the complaint in January and clearly took it very seriously. 188 It sought (and achieved) resolution of the Union's involvement. 189 It investigated the complaint promptly and fully and took immediate action on its findings. 190 It created a position for him at another site in an attempt to protect him from the Union's activities. The actions of the defendant in removing the plaintiff to Mascot in the face of the union protest were accepted by both Ms Todd and Professor Tennant as an appropriate response. 191 It promoted him to full time work. 192 All of the above are completely at odds with plaintiff's own argument that the defendant failed to implement and enforce its own policy."
2. Ultimately, this was the dispositive reason, not the findings which denied the foreseeability of a risk of harm or the absence of a material causal connection between the bullying and harassment and the recognised psychiatric illness, which were insupportable.
3. In this situation, the outcome of the appeal turned upon the appellant's attempts to demonstrate that the respondent either had or should have had knowledge requiring action at a date earlier than that accepted by the trial judge or that, even on the findings of the trial judge, the employer failed to act with reasonable expedition. These challenges failed for the reasons given by Adamson JA.

Vicarious liability

1. There was a separate issue raised on the appeal as to whether the employer should have been held vicariously liable for the conduct of its employees. As explained by Adamson JA, there were procedural reasons for dismissing this challenge given the manner in which it was raised, without being pleaded. However, the problems lie deeper than the failure to plead.
2. Ground 10 referred to vicarious liability "for the conduct of Mr Johnpulle, Mr Fath and other employees". No mention was made of senior supervisory staff, including Mr Peacock and Mr Hewlett. It is unlikely that they were intended to fall within the category of "other employees". In fact, the trial either ran upon an implicit assumption that the respondent was vicariously liable for their conduct or that, though not articulated in these terms, they were persons sufficiently senior in the hierarchy for their acts or omissions to be those of the company itself: see Nationwide News Pty Ltd v Naidu (supra at [118*]). Mr Johnpulle was the source of the bullying and harassment: to the extent that Mr Karzi suffered injury from his activities, the claim must have been one for a direct or intentional tort, not negligence, but only negligence was pleaded. A similar inference would be drawn with respect to other co-workers who engaged in harassment of Mr Karzi in response to his complaints about Mr Johnpulle.
3. To the extent that Mr Karzi's immediate supervisor, Mr Fath, was said to have been negligent in failing to make an earlier report of Mr Johnpulle's misconduct, the claim would have required further analysis of Mr Fath's position in the industrial hierarchy at the company's workplace. But it would also have depended upon a factual finding with respect to an earlier complaint, which the trial judge did not accept and in respect of which the challenge on the appeal has been unsuccessful. It need not be pursued further, although it may be observed that Mr Fath could not have been treated as a personification of the respondent, so that the respondent could only have been vicariously liable for his conduct.

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