Lunn v The Commissioner for Public Employment

Supreme Court of NSW|2008-09-17|Before: Hislop J

Introduction 1 HIS HONOUR: This is an application by the defendant for an order pursuant to s 5(2) of the Jurisdiction of Courts (Cross Vesting) Act, 1987 (NSW), transferring the proceedings to the Supreme Court of the Northern Territory of Australia. The application is opposed by the plaintiff. 2 The proceedings were commenced by statement of claim filed in this court. The statement of claim alleges, in essence, that the plaintiff was continuously employed by the defendant as a lawyer in the Northern Territory Attorney General's Department on a series of fixed term contracts from 28 May 1998 to 15 April 2005; that in the course of such employment she was subjected to bullying behaviour by her direct supervisor (Mr Shields) from about June 2004; that complaints in November 2004 in particular to Ms Oliver, who was then the Acting Director of Legal Services, and to Ms Christopher about this behaviour were not adequately addressed; that in consequence the bullying and victimisation of the plaintiff by Mr Shields continued and this caused deterioration of the plaintiff's health. Ultimately the plaintiff's contract of employment was not renewed and her employment concluded on 15 April 2005. She alleges that as a result of these matters she suffers from a depressive disorder. She seeks damages for breach of contract and breach of the duty owed by an employer to its employees. Her claim includes a claim for aggravated and exemplary damages. 3 In an affidavit read on this application, the plaintiff alleges that Mr Shanahan, then the Acting Chief Executive Officer of the Department of Justice, did not take any reasonable steps to ensure that a proper investigation was carried out into the reasons for terminating her employment and that Mr Coates, who was the Chief Executive Officer of the Department of Justice, failed to ensure that the response of the Department to the plaintiff's application for a review under s 59 of the Public Sector Employment and Management Act was dealt with in a timely manner. Neither Mr Shanahan nor Mr Coates is expressly referred to in the statement of claim. 4 The Jurisdiction of Courts (Cross-vesting) Act 1987 (NSW) provides: "5. (2) Where - (a) a proceeding (in this subsection referred to as the ' relevant proceeding' ) is pending in the Supreme Court (in this subsection referred to as the ' first court' ), and (b) it appears to the first court that:… (iii) it is otherwise in the interests of justice that the relevant proceeding be determined by the Supreme Court of another State or of a Territory, the first court shall transfer the relevant proceeding to that other Supreme Court." 5 Sub-section 5(2)(b)(iii) refers only to the "interests of justice". However the test that has been applied under this paragraph involves the determination of which forum is "more appropriate" - James Hardie & Coy Pty Ltd v Barry (2000) 50 NSWLR 357 at [4] per Spigelman CJ. 6 In BHP Billiton Limited v Schultz [2004] HCA 61; 221 CLR 400 Kirby J referred to the relevant principles in the following terms: "[161] …the clear purpose of the residual criterion expressed by the legislatures of Australia in the common form of the cross-vesting Acts has been, for this purpose, to follow the approach of Lord Goff [in Spiliada Maritime Corporation v Cansulex Limited (1987) AC 460]… [163] …This was to the effect that 'more appropriate' forum was the 'natural forum' for the trial of the action. This was described as being 'that with which the action had the most real and substantial connection'… [and included factors effecting convenience and expense] [170] …Normally, 'the interests of justice' of all parties within Australia will require the transfer of proceedings to be determined by the Supreme Court of another State or of a Territory where that Court, rather than the court of the forum selected by the plaintiff, is the 'natural forum' being that 'with which the action has the most real and substantial connection'."

The defendant's primary submission 7 The defendant's primary submission is that this action has its most real and substantial connection with the Northern Territory:- the defendant is a statutory office created by the law of the Northern Territory, the contracts for employment were entered into and performed in the Northern Territory, the contracts provided they would be governed by the law of the Northern Territory, the alleged breaches of contract and duty occurred in the Northern Territory, the plaintiff and all potential witnesses reside in the Northern Territory, the defendant's lawyers reside in the Northern Territory, there is no connection of the action with any other State or Territory. Considerations of costs and expense favour the action being determined in the Northern Territory. Accordingly "the balance of convenience to the parties and witnesses and convenience to the court system is overwhelmingly in favour of the matter being heard and determined in the Northern Territory." The plaintiff's submissions 8 Counsel for the plaintiff properly conceded that all connecting factors pointed to the Northern Territory and that, but for considerations of apprehended bias and embarrassment, the Northern Territory Supreme Court would be the more appropriate forum. However, she submitted, in the unusual circumstances of this case, the Supreme Court of the Northern Territory was clearly an inappropriate forum because of the clear possibility (even probability) that there would be a reasonable apprehension of bias or embarrassment if the proceedings were heard in that court. As such it was only if the matter was tried in a court outside the Northern Territory that the interests of justice for both the plaintiff and the defendant would be served. The possibility or probability of apprehended bias or embarrassment extended to the court as a whole. No allegation of actual bias or impropriety was made against any member of the Northern Territory Supreme Court. .

9 The plaintiff, in her affidavit, described her principle concerns as follows: "If these proceedings are heard in the Northern Territory, it is my belief that the connections between Mr Shields, Magistrate Oliver, Mr Shanahan and Mr Coates, other former and current management of the Department of Justice and the Judges of the Northern Territory Supreme Court, raise a reasonable suspicion that the matters might not be resolved by fair and unprejudiced minds for the reasons provided below. In these proceedings, it is likely that some issues will come down to a question of my word against the word of Mr Shields, Magistrate Oliver, Mr Shanahan or Mr Coates. If my claim is accepted, the proceedings may also result in findings that are critical of one or more of Mr Shields, Magistrate Oliver, Mr Shanahan or Mr Coates. It is my belief that these possibilities also raise a reasonable suspicion that the matters might not be resolved by fair and unprejudiced minds for the reasons provided below."

10 The plaintiff adduced evidence that the legal profession in the Northern Territory was small; that the persons of whose action or inaction she complained now occupied senior positions in the Northern Territory legal profession (Mr Shields is Executive Director of Policy in the Chief Minister's Department, Ms Oliver is a magistrate of the Northern Territory, Mr Coates is Director of Public Prosecutions for the Northern Territory, Mr Shanahan has been appointed as the Chief Executive Officer of the Department of Justice) and that there were professional and social ties between those persons and members of the Northern Territory judiciary of varying degrees.

11 In her submissions, counsel for the plaintiff placed particular reliance on Tribond Developments Pty Limited v Griffin [1997] FCA 106 (Lehane J) (in respect of the embarrassment argument) and McLean v Nicholson [2002] VSC 446; (2002) 172 FLR 90 (Bongiorno J) (in respect of the reasonable apprehension of bias question). Reference was also made by the plaintiff in submissions to Northern Australian Aboriginal Legal Aid Service Inc v Bradley at first instance (2001 FCA 1728). However, I found the reference of little assistance and as it was disputed by the defendant, particularly having regard to the subsequent decision of the High Court in that matter ((2004) 218 CLR 146) it is unnecessary to pursue it. 12 In Tribond an application was made to transfer proceedings from the Federal Court to the Supreme Court of South Australia. The proceedings arose under or involved questions of the application of the law of South Australia. One of the defendants was the Attorney General for South Australia who was personally a respondent. It was submitted that questions may arise in the proceedings not merely as to what the Attorney General may have said, and to whom, but also as to his state of knowledge and motivation. It was considered probable that the Attorney General would give evidence and be cross examined. The Attorney General had long been prominent in the legal and political affairs of the State of South Australia. It was submitted it was likely it would be difficult to find a judge of the Supreme Court who was not disqualified or at least unwilling to hear the matter and that, in any event, there would at least be embarrassment in circumstances where a judge of the Supreme Court was required to hear a case in which exemplary damages were sought against the chief law officer personally. There was no evidence as to the extent of any acquaintance between the Attorney General and any member of the Supreme Court. There was, however, no doubt about the importance of the institutional connection between the Attorney General and the court and Lehane J thought it proper to infer, on the material before him, that most, if not all, judges of the Supreme Court of South Australia were likely to be acquainted, in varying degrees, with the Attorney General. In those circumstances, his Honour considered it "…probable that the matters of appearance and of embarrassment, to which the applicants refer, will arise if the matter is transferred to the Supreme Court. It by no means follows, of course, that the Supreme Court could not determine the proceeding: if the applicants had commenced it in the Supreme Court, no doubt that Court would have heard and determined it. But in fact the applicants have commenced the proceeding in this Court; it can be heard in this Court, in Adelaide if as seems likely that is the appropriate place, by a judge who has no acquaintance with the Attorney-General."

In those circumstances the application to cross vest to the Supreme Court of South Australia was refused. 13 The relevant principle as to the apprehension of bias was stated In Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 at [6] as: "…a judge is disqualified if a fair minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question the judge is required to decide."

14 In McLean proceedings were brought in the Supreme Court of Victoria seeking damages for injury caused in Queensland. One of the plaintiffs was the daughter of the Chief Executive Officer of the Victorian Supreme Court. It was likely that he would be a material witness in his daughter's claim as to both liability and damages. No party raised any question about the proceedings being determined in the Victorian Supreme Court. However, Bongiorno J determined, of his own motion, that the action should be cross vested to the Queensland Supreme Court because "every judge of this court has, to a greater or lesser degree, an association with the Court's Chief Executive Officer even if, as may well be the case, some judges do not know him personally …it could not rationally be expected that the case would be passed from one judge to another within the court in the hope that, at some point, one who held a different view as to the questions raised might be found."

His Honour observed that it would be not only a trial but interlocutory hearings before trial which would be equally affected by the apprehended bias principle.

(a) There would be no inconvenience or additional cost to the defendants in the preparation of the matter if it remained in the Supreme Court of New South Wales as the defendant's lawyers and all witnesses were located in the Northern Territory. The cost of witnesses travelling to, and being accommodated in Sydney during the hearing, if the matter remained in the New South Wales Supreme Court, could be avoided by the evidence being taken on commission in the Northern Territory. The plaintiff had no opposition to the evidence being taken in that way;

(b) If the proceedings were transferred to the Northern Territory Supreme Court the plaintiff would make further application seeking to remove the matter from the Northern Territory Supreme Court;

(c) If the matter proceeded in the Northern Territory Supreme Court the Registrar may be involved in interlocutory applications. The Registrar was a close friend of Ms Oliver;

(d) "the interests of justice in relation to this unique matter which involve probably unfortunate and perhaps distasteful determinations to be made, would be better served by leaving the proceedings here in New South Wales and dismissing the defendant's motion to transfer to the Supreme Court of the Northern Territory." Further submissions of the defendant 16 The defendant referred the Court to O'Connor v Nationwide News Pty Limited (1995) 128 FLR 61 (Higgins J). In that case the plaintiff was a Federal Court judge and President of the Industrial Relations Commission. He sued for damages in defamation in the Supreme Court of the Australian Capital Territory. The defendant sought to cross vest the proceedings to the Supreme Court of New South Wales which would avoid an alleged reasonable apprehension of bias resulting from the collegiality of and between the plaintiff and judges of the Federal Court. After referring to an observation of Wilcox J in Trustees of Christian Brothers v Cardone (1995) 57 FCR 327 at 336 that "There is no general rule that a judge is disqualified from hearing a case in which a witness known to him or her will be called",

Higgins J stated that "The degree of that knowledge and the extent of it will determine whether any particular judge considers that he or she should not preside over this case if assigned to him or her by the usual listing processes. The nature of the case and the issues raised by it will be of great significance in that consideration."

His Honour concluded that he did "not consider that the judges of this or of the Federal Court are necessarily disqualified for apprehended bias merely by reason of their common membership with the plaintiff on the Federal Court." On that basis, the application for transfer was refused. 17 The defendant further submitted that, in essence,

(a) the plaintiff's position is that the mere fact of her employment and the mere fact of her allegations against a senior officer of the Justice Department was sufficient to give rise to an apprehension of bias. This is untenable without more. The plaintiff has not identified the basis upon which it is alleged there is a risk that each judge of the Supreme Court of the Northern Territory is likely to decide the proceedings other than on its merits and has not articulated the logical connection between the matter and the feared deviation. All the plaintiff points to are allegations of association between persons who may be called as witnesses and some members of the Supreme Court of the Northern Territory.

(b) McLean's case is distinguishable. The role of Mr Shanahan is not to be equated to the CEO in that case;

(c) Tribond is distinguishable. The relationship of judges to the Attorney General of their State or Territory is not to be equated to the relationship of the judges and administrative officers generally. Tribond should be confined to its special circumstances;

(d) There are some judges of the Northern Territory Supreme Court in respect of whom there is no suggestion in the evidence of any personal connection with any of the likely witnesses;

(e) In the event that each of the judges of the Supreme Court of the Northern Territory considered the circumstances were such that the court should decline to determine the proceedings, then the proceedings could be transferred from the Supreme Court of the Northern Territory to the Federal Court pursuant to the Jurisdiction of Courts (Cross Vesting) Act, (NT), s 5(1)(b)(iii). This would enable a Federal Court judge to sit in the Northern Territory to determine the matter, thus providing a convenient and less expensive procedure than would be provided if the matter was continued and heard in New South Wales. Determination 18 All connecting factors are with the Northern Territory. There are no connecting factors with New South Wales. Generally considerations of cost, expense and convenience favour a Northern Territory forum. Ordinarily these factors would result in the application to transfer the proceedings to the Northern Territory Supreme Court being upheld. 19 It is to be accepted that the court, in determining the defendant's application, may have regard to issues of apprehended bias or embarrassment - see McLean and Tribond. I accept that McLean's case may be distinguished on its facts in that it was a judge of the court from which the proceedings were cross vested who made the order on behalf of that court and additionally, the transfer was to the appropriate forum. I accept that Tribond involved the special relationship of an Attorney General to the Judges in his State; 20 The defendant's alleged liability is vicarious. It is the administration of the Northern Territory Supreme Court and, in particular, the acts and omissions of Messrs Shields, Shanahan and Coates and Ms Oliver which are in question. The allegations are serious and aggravated and exemplary damages are sought. A court determining the claim will almost certainly be required to make credit findings, and, if the plaintiff is to succeed, findings critical of the administration of the court and those involved in it; 21 The legal profession in the Northern Territory is small. Messrs Shields, Shanahan and Coates and Ms Oliver held relatively senior positions in the legal administration in the Northern Territory at the relevant time. Each now holds a prominent position in legal and/or administrative areas in the Northern Territory. It may be accepted that a degree of social and/or professional contact has or will occur between those persons and the judges of the Supreme Court. There may be a need for future professional cooperation which could be jeopardized by adverse findings in this case. Similarly relations with other members of the profession could be adversely affected. There may be apprehended a judicial reluctance to be critical of the court's administration or persons high in the legal or administrative hierarchy. It may also be apprehended that the judges may have knowledge of the reputations of the plaintiff and witnesses gained from extraneous sources. It is arguable that these factors could lead to the conclusion that the judges of the Northern Territory Supreme Court should decline to hear the case or should disqualify themselves. 22 Additionally there is evidence that in a number of cases there were personal / social relationships between some judges and Messrs Shields, Shanahan and Coates and/or Ms Oliver such as arguably might alone require the judge to disqualify him or herself, though it is not asserted this evidence extends to all judges. 23 It would be inappropriate for me to determine whether the justices of the Supreme Court of the Northern Territory should disqualify themselves or decline to hear this matter - Ebner at [74]. However the circumstances are such that the issue is arguable; 24 Plaintiff's counsel has indicated that if the proceedings are transferred to the Northern Territory Supreme Court the plaintiff will apply to that court to have the proceedings transferred to a court in another State or to the Federal Court. Such an application will add to the overall cost of the proceedings. 25 The likely response of the Supreme Court of the Northern Territory to an application for transfer of the proceedings is not known. It may determine that it should not hear the proceedings in which event, presumably, it would transfer the proceedings to the Federal Court or a State Supreme Court. In such event nothing of substance would have been gained by upholding the application presently before this court.

26 On the other hand the Supreme Court of the Northern Territory may decide to hear the proceedings. In that event there presumably will be a challenge to the Registrar determining any interlocutory matters, a challenge to the judge who is assigned the matter for hearing and ultimately an appeal on the embarrassment / apprehended bias issue if the plaintiff does not obtain a verdict satisfactory to her. These challenges would be inconvenient to all concerned and add considerably to the cost of the proceedings. 27 The retention of the matter in the New South Wales Supreme Court will remove all questions of embarrassment and apprehended bias. The only inconvenience if the matter remains in the New South Wales Supreme Court would appear to relate to witnesses travelling to and being accommodated in Sydney for the hearing. The costs of such travel and accommodation and any associated inconvenience to witnesses will be alleviated if the evidence is taken on commission in Darwin to which course the plaintiff would consent. 28 In my opinion the balancing of the relative considerations leads to the conclusion that, in the particular circumstances of this case, the interests of justice are such that the proceedings should remain in the Supreme Court of New South Wales. Accordingly the application to transfer the proceedings to the Supreme Court of the Northern Territory is refused. 29 I make the following orders:

(2) The defendant is to pay the plaintiff's costs of the application.

(3) The proceedings are to be listed before the Registrar for directions on 10 February 2009.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.

Jurisdiction of Courts (Cross Vesting) Act 1987(NSW)

CITATION : Lunn v The Commissioner for Public Employment [2009] NSWSC 19

BHP Billiton Limited v Schultz [2004] HCA 61 Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 James Hardie & Coy Pty Ltd v Barry (2000) 50 NSWLR 357 McLean v Nicholson [2002] VSC 446 CASES CITED : Northern Australian Aboriginal Legal Aid Service Inc v Bradley (2001 FCA 1728) Northern Australian Aboriginal Legal Aid Service Inc v Bradley (2004) 218 CLR 146) O'Connor v Nationwide News Pty Limited (1995) 128 FLR 61 Tribond Developments Pty Limited v Griffin [1997] FCA 106 Trustees of Christian Brothers v Cardone (1995) 57 FCR 327

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