(a) from 20 March 2025 to 31 March 2025 at $2,307.68 per week, and

(b) from 1 April 2025 to date and continuing at $2,317.60 per week and increased as indexed from time to time.

1. There is an award pursuant to s 60 of the Workers Compensation Act 1987 that the respondent pay the applicant's reasonably necessary medical and related treatment expenses.
2. Either party to have leave to apply for further orders in relation to the calculation of pre-injury average weekly earnings (PIAWE) of the calculated indexed amounts.

A brief statement is attached setting out the Commission's reasons for the determination.

1. The applicant in this matter, Susanne Modderno, is a 66-year-old accountant who seeks weekly compensation on the basis that she has no current work capacity as a consequence of a primary psychological injury with a deemed date of injury of 25 September 2024.
2. The applicant, prior to her employment with the respondent, was the proprietor and sole director of an accountancy practice operating under the name "Modderno and Co Pty Ltd."[1]
3. Ms Modderno states that her accountancy practice had over 2,000 clients which were serviced by herself, four other accountants and two additional administrative staff.
4. On or about 15 March 2022 the applicant essentially sold her accountancy practice to the respondent (which itself is an accountancy practice) with Modderno and Co Pty Ltd entering into a contract[2] with the respondent for the sale of the accountancy business (sale contract).
5. The business was sold on the basis of a base price of $550,000 plus a percentage share of fees in excess of a figure of $500,000 for the first-year post completion.
6. The price payable under the sale contract was to be paid by an initial payment of $137,000 on completion, $137,500 plus the fee share on the first anniversary of completion and $137,000 on the second and third anniversaries of completion.
7. As far as I can determine completion of the sale contract occurred on or about 1 May 2022 at which time the applicant entered into a contract of employment (employment contract) with the respondent albeit that the employment contract was apparently formally signed on

13 May 2022.[3] 8. The employment contract provided for the employment of the applicant as a "director" (which I understand to mean a senior position as an accountant rather than an actual directorship on the board of the respondent) within the respondent's accountancy practice with the applicant to be paid a base salary of $150,000 plus superannuation per annum. 9. Concurrently with entering into the employment contract with the respondent the applicant also entered into a Confidentiality Agreement with the respondent on

13 May 2025[4] (confidentiality agreement). 10. It is fair to state that the consideration being paid for the accountancy practice of Modderno and Co Pty Ltd was a significant sum of money. 11. It is also fair to state that the remuneration to be paid to the applicant and her job description as set out in the employment contract suggests that she was employed as a senior professional member of the staff of the respondent. 12. The sale contract was somewhat unusually drafted in that the provisions of clause 26 of the Law Society standard form of Contract for the sale and purchase of business (which clause deals with training to be provided by the vendor to the incoming purchaser in the operation of the business and its systems) was amended by special condition clause 37 to impose on the vendor or its nominee obligations to assist in the transfer of the clients of Modderno and Co Pty Ltd to the respondent's accountancy practice and to add an additional clause 26.6 which created an entitlement for the purchaser to withhold payment of instalments of the purchase price if the "Training Period" is not completed as reasonably agreed by the parties until the vendor effectively remedied that failure.[5] 13. The applicant states that it was her understanding that she would be allocated a senior accountant by the respondent to assist with the transitioning of the clients of Modderno and Co Pty Ltd to the respondent and its data base and that once that had occurred that senior accountant would take over full responsibility for each client as the transition was completed.[6] 14. The applicant states that she expected to continue to provide services to the clients of Modderno and Co Pty Ltd until they were "handed over" to the senior accountant allocated to her.[7] 15. The applicant further states that her expectation was that while her workload would be high at first (following the sale of the business to the respondent) it would decrease over time as the clients were transferred to the accountant employed by the respondent who would assume responsibility for those clients.[8] 16. The applicant states further that she expected the transitioning of the clients would take about three years which would enable her to gradually reduce her working hours prior to completely retiring.[9] 17. It appears from the applicant's statement that the respondent re-employed, in addition to the applicant, two of the accountants that had been employed by Modderno and Co Pty Ltd (a Robert Vonicina and a Thiri New) together with the administrative assistant Isabel Whitehead.[10] Accordingly there would be two fewer accountants and one fewer administrative assistants to deal with the clients of Modderno and Co Pty Ltd than prior to the sale of the business to the respondent absent any support from the staff of the respondent. 18. The applicant states that when she commenced work for the respondent following completion of the sale of the business of Modderno and Co Pty Ltd to the respondent there was no senior accountant of the respondent allocated to her as the person to whom she could introduce clients, and to whom she could effect a transfer of that client's work.[11] 19. The applicant's case is that she found herself working long hours trying to service the needs of the clients especially given the reduction of the staff numbers servicing those clients compared with the numbers previously employed by Modderno and Co Pty Ltd to carry out that work. 20. The applicant also states that she was given only minimal training in the computer systems and software operated by the respondent when she commenced work for the respondent, which she claims contributed to her heavy workload.[12] 21. The applicant concedes that in approximately October 2022 the respondent was able to hire an accountant, a Mark Wehbe, to assist her with her work and transition of clients but states that Mr Wehbe was uncooperative and difficult to work with.[13] 22. The applicant states that she made complaints to directors of the respondent about the work performance of Mr Wehbe which were "largely ignored"[14] but in January 2023 Mr Wehbe was moved to another team in the practice before he ultimately left the employ of the respondent in around April 2023.[15] 23. The applicant states that Mr Wehbe was not replaced when he was transferred to the other team in the practice which meant there was no person from the respondent who was to take over responsibility for the transfer or transition of those clients from the applicant to accountants working at the respondent.[16] 24. The applicant alleges that as Mr Wehbe had not been replaced she was left with "the unrelenting demands of servicing a large number of clients with insufficient resources"[17] leading to the applicant feeling "stressed and struggling."[18] 25. The applicant states that she raised these issues with the management of the respondent on a number of occasions prior to October 2023 but nothing was apparently done about the situation because the respondent was finding difficulty obtaining additional staff.[19] 26. The respondent's witnesses dispute the applicant's version of events between May 2022 (when the business of Modderno and Co Pty Ltd was acquired) and October 2023 with

Mr David Cox the managing director of the respondent asserting that the applicant was hesitant to adopt the respondent's work methods and systems,[20] that she was given sufficient ongoing training,[21] that she resisted transferring or transitioning clients to accountants at the respondent despite a partner having been brought back from England to assist her and that she had more than adequate staffing provided to assist her in her work (particularly as she no longer had the administrative demands of running her own business).[22] 27. Mr Cox also stated that there was an ongoing problem in relation to transfer or transition of clients of Modderno and Co Pty Ltd to accountants in the respondent's practice due to the applicant's reluctance to do so.[23] 28. Mr Cox expressed the view that the failure to effect a transition of clients resulted in the applicant taking on more responsibility than would otherwise have been necessary, increasing her workload.[24] 29. Mr Cox states that he and Mr Troy Reason (another director of the respondent) realized that they needed to address the "transition issue" and they called a meeting on 17 October 2023 between themselves and the applicant to "specifically address the transition."[25] 30. Mr Reason, while not commenting on the applicant's work performance or workload in the period between May 2022 and October 2023, stated that the applicant was reluctant to "hand over her clients"[26] and was "holding onto more work than necessary."[27] 31. Mr Reason agrees that because of the problems with the slow pace of transfer of clients from the applicant, he and Mr Cox met with the applicant to discuss those concerns on 17 October 2023. 32. The applicant confirms that she attended a meeting with Mr Cox and Mr Reason on

17 October 2023. 33. The applicant, Mr Cox and Mr Reason give differing versions as to what occurred during the meeting, however all have provided statements that confirm that the meeting became heated although the versions differ as to who became aggressive towards whom. 34. It appears that thereafter there were ongoing tensions between the applicant on the one hand and Mr Cox and Mr Reason on the other when issues of meetings or correspondence arose with the applicant perceiving interactions between herself and Messrs Cox and Reader as involving bullying and harassment by those gentlemen. 35. Mr Cox stated that the meeting in October 2023 ended with it being agreed that they needed to come up with a new plan to effect the transfer or transition of clients of Modderno and Co Pty Ltd to other members of the respondent's staff.[28] 36. Mr Cox further stated that after returning from a two-week trip to America that he took following the 17 October 2023 meeting he came up with a plan to "address the issues we were facing with the team, the transition."[29] 37. Apparently the approach to be taken was that two "partners" of the respondent's practice, a Jake Rose and a Jonathon Buckley, were to be put in charge of the transition of the practice of Modderno and Co Pty Ltd to the respondent's business.[30] 38. A meeting was held with the applicant in early November 2023 when the proposed plan to deal with the transition issues was discussed with her. 39. The applicant stated that:

"I was pleased with this suggestion because I was desperately looking for someone I could transition the clients to and who would take control of those matters so that I was no longer having to deal with them."[31]

1. The applicant's evidence is that despite agreeing to the proposed plan and being happy with same the arrangement did not work out as expected as neither Mr Rose nor Mr Buckley were able to be involved on a dedicated and systematic basis.[32]
2. The applicant claims that she continued to service the majority of her clients and at the same time perceived a degree of hostility from Mr Cox and Mr Reason in the office.[33]
3. The applicant states that as a consequence she was "increasingly depressed, upset and anxious".[34]
4. In February 2024 the applicant's mother died and the applicant took leave from

1 February 2024 to 9 February 2024. 5. The applicant's evidence is that after she returned to work in February 2024 there were numerous discussions between herself Mr Cox and Mr Reason about continuing problems in the transfer or transition of clients from the applicant to the respondent's business with the applicant asserting that she made suggestions or proposals that were not accepted.[35] 6. The respondent's witness, Mr Cox, disputes that version of events with Mr Cox stating that between November 2023 and April 2024 Mr Rose and Mr Buckley attempted to,

"... work towards the transition with clients and Susan. However by April 2024 they advised us that they were still not making headway with this."[36]

1. It is clear that the respondent was unhappy with the pace of transition of clients to its business and in a meeting that appears to have occurred on or about 26 April 2024 the applicant was advised that the third instalment of the purchase price payable for the business of Modderno and Co Pty Ltd would be withheld pending satisfactory arrangements being reached in relation to the transition of clients.
2. The meeting appears to have been somewhat heated with the applicant stating in her evidence that she felt intimidated and helpless.[37]
3. It also appears to be the case that at the meeting on 26 April 2024 the representatives of the respondent suggested that if the applicant was unhappy with the proposals put forth by the respondent as to how to effect a transition of clients to the respondent's practice that the applicant should supply her own plan.[38]
4. Apparently the applicant supplied a draft proposal to Mr Cox, or some other member or members of the respondent's practice on 29 April 2024 however that proposal was regarded by Mr Cox as incomplete and unsatisfactory as it "failed to address the requirements of clause 26.4."[39]
5. There was a subsequent meeting between the applicant, Mr Cox, and Mr Reason on

30 April 2024 when, in addition to discussing the applicant's proposal and the issues in relation to the transitioning of clients from the applicant to other members of the respondent's staff, the applicant was given a document outlining a series of criticisms that had been communicated to Mr Cox and/or Mr Reason about the applicant's work performance by colleagues at the respondent's business.[40] 6. The applicant's evidence is that in addition to raising the issues of work performance Mr Cox and Mr Reason again stated that the transition of clients was not happening quickly enough with the applicant replying that she needed:

"more resources and for a plan and or procedures between the employer staff and myself to avoid any confusion and to ensure that both I and the other employees understood the process and what was expected."[41]

1. Copies of an email chain suggest that the applicant understood that her employment was being terminated in the 30 April 2024 meeting however Mr Cox clarified in an email response dated 1 May 2024 to the applicant's email of the same date about the issue that:

We are not talking about your employment, we are talking about your obligations under the Business Sale Agreement to Transition clients.

We have provided Feedback to you as requested which confirmed the fact that we question your action and hampering the transition of client relationships.

I am open to discuss today, but I would suggest you bring a support person to any future meetings so as to minimise any misunderstandings on your end.

We will be issuing a formal warning with regards to your employment relating to your actions of continuing disregard for direct instructions."[42]

1. Although the applicant's statement evidence suggests that she was given on 1 May 2024 a document setting out 26 points for discussion[43] the email chain forming part of the reply seems to be consistent with the applicant sending an email dated 2 May 2024 suggesting a meeting between herself and Messers Cox and Reason at 2.30pm on 2 May 2024[44] without any reference to a document setting out 26 points for discussion.
2. Mr Cox responded to the applicant's email in the following terms:

"Thanks for getting back to us. Will you be bringing a support person with you, if not, could you please reschedule the meeting or let us know who will be attending.

1. To agree a principled, mutually beneficial de-merger of the Modderno and Co fee base from ProYou.
2. To provide written formal warning of your actions under the ProYou handbook."[45]
3. There is no mention in that email of a discussion of 26 points that had been set out in a document.
4. It does appear that in the meeting on 30 April 2024 the applicant had been provided with a document headed "For Discussion with Sue about assisting with "Letting Go",[46] however that document does not seem to have been relevant to any subsequent discussion nor does it seem to have been provided on 1 May 2024.
5. On 2 May 2024 the applicant emailed Messrs Cox and Reason nominating a Mr Stuart Geoff [sic] as her support person for the proposed meeting which then did not proceed on that day for reasons that are unclear.
6. Later that day Mr Cox sent a lengthy email to the applicant which traversed a number of issues including the question of the appropriateness of the nominated support person to any meeting, the reason for the withholding of the instalment payment for the purchase of the practice of Modderno and Co Pty Ltd, the difficulties being experienced in relation to transitioning of clients and a summary of recent events.[47]
7. The email also included the following comments:

"It is our position that we have given you every opportunity and have committed considerable resources to assist you in complying with Clause 26.4 over the past 24 months.

We have supplied you with comments from the team in relation to your actions and inactions under clause 26.4 which further supports our position. The team have made no less than 26 comments relating to the way you go about your business and your unwillingness to let go and transition the clients. For the avoidance of doubt I have attached this commentary.

You are obliged to transition the client base under the contract and failure to do so can result in payment being withheld.

Given your inability to adapt, relinquish control or supply an acceptable viable alternative for the transition of clients under Clause 26.4 we cannot reasonably foresee a situation that fulfills your obligations.

We have evidence that you have publicly degraded members of the leadership team in discussions with staff, which we see as an attempt to undermine the business as a whole (for which we will issue a formal warning against your employment at our next face to face meeting).

Additionally, we have witnessed situations where you have also belittled the team members who are attempting to assist in your transition essentially alienating the wider team.

Given the untenable nature of the relationship we are open to discussing a commercially acceptable separation of the businesses so that each party can move forward.

Until this issue is settled we remind you of your employment and contractual obligations to ProYou Business Advisory Pty Ltd and seek your understanding and undertaking to comply.

1. The applicant responded to the email sent by Mr Cox referred to in paragraphs 57 and 58 in an email dated 3 May 2024 in the following terms:

Although I do not propose to address every aspect of your email in this correspondence, as we have differences of opinion, key items I do wish to raise are as follows:

• - With respect, I do not consider it appropriate to include the wider office in our email correspondence.
• - I agree that a meeting should occur to discuss a commercially acceptable separation on a "without prejudice" basis and I will have Mr Gough attend with me.
• - It would assist me in preparing for the meeting (and for efficiency) if you could provide me with the details of the plans and allocation of resources you have put forward to date and in respect of the transition plan you wish to implement, and also provide the details of the separation proposal you had in mind.
• - Once I receive that information from you, we can set an agreed time and date for the meeting.
• - For completeness, please provide me with a copy of the attachment referred to in your email where you mention 'For the avoidance of doubt I have attached this commentary.'
• - For clarity, I otherwise reserve all of my rights and remedies in respect of your correspondence."[49]

1. The applicant on the same day (3 May 2024) saw her doctor, Dr Yanco, at Ramsay Street Medical Centre for treatment for severe anxiety.
2. The applicant was given a certificate of incapacity for work from 3 May 2024 to 7 May 2024 and was apparently referred for psychological treatment.[50]
3. Mr Cox responded to the applicant's email of 3 May 2024 on 9 May 2024 (it may be that the delay in the response was occasioned by the applicant's medical certification and consequent absence from work).
4. Relevantly Mr Cox's response noted:

"We do not feel it is necessary to provide anything in writing as we agreed to a meeting to discuss several issues that still require addressing, namely:

1. A formal written warning of your behaviour which hasn't been rectified despite numerous verbal warnings.
2. Your inability to transition clients under the contract, the incomplete transition plan you have put forward, not agreeing or complying with previous transition plans put forward and the 26 comments we had from the team about you transitioning and other behaviour. We handed the de-identified feedback to you by hand in our meeting to give you time to reflect on it before the proposed meeting. You indicated you would read the feedback.

We strongly believe the fact we were forced to hand this feedback to you, due to your combative nature towards its authenticity, as a major contributor to the current situation.

We feel that we do in fact need to address every aspect of our email correspondence in this meeting as we believe there is clear evidence of a pattern of behaviour. This behaviour culminated in the seeming engagement of a lawyer (claiming legal privilege on documents tended to him) on the pretence of him being your support person.

For absolute clarity, at the time of introducing your lawyer/support person there was absolutely no dispute as to continuance your employment or payment of the third instalment under the contract."[51]

1. After some discussion about the role and retention of Mr Gough and possible conflicts of interest Mr Cox further stated:

"Sue, we have not engaged any lawyer or discussed this within the wider Network. Until your email we did not think it even necessary as we just wanted you to have a support person to help you with the process. We will continue in this manner unless forced to do otherwise.

We strongly believed that supplying the feedback we were relying on in our previous meetings would be the catalyst for you to hopefully accept that you might be struggling with the notion of 'letting go.' Unfortunately it seems you have taken this path.

We still however strongly desire an arrangement that can be mutually agreed.

As such we would like to have a meeting by COB Monday the 13th of May ..."[52]

1. It appears that the applicant responded to that email on 10 May 2024, inter alia, requesting payment of the third instalment of the purchase price after which payment she would agree a mutually convenient meeting date.[53]
2. On 13 May 2024 Mr Cox emailed the applicant a lengthy response setting out a detailed statement of the respondent's concerns in relation to the transitioning of clients and the respondent's assessment of the feasibility of the applicant's proposals in relation to the transition process.[54]
3. Mr Cox summarised the position as one where over a two-year period only 8% of total business group clients by number or 18% by fees had been transferred from the applicant to other members of the respondent's practice.[55]
4. Mr Cox noted on the basis of the applicant's proposal the respondent estimated that by the "expiry of your contract" (which I understand to be the date for payment of the last instalment of the purchase price) approximately 32% of business clients by number or 46% by fees would be transitioned to the respondent's practice.[56]
5. Mr Cox also noted that those figures excluded non business clients.
6. In the email Mr Cox relevantly commented:

"Now we have cleared that up hopefully we can agree our discussions were, once again, in this regard about the transition of your clients which we have continually done over a long period of time. We have put plans in place to help you with your obligations well before the anticipated date in the contract for the 3rd instalment.

We use the term anticipated payment because it is clearly a condition for the action of payment that both parties need to reasonably agree that you have fulfilled your obligations to transition client relationships. We have had ongoing meetings and discussions with you about this. We have also committed a substantial amount of time, effort and resources along with plans to help you fulfill your obligations under the contract.

For absolute clarity and given the fact that you can see the financial accounts, it is clearly shown in our balance sheet we have set aside money specifically to fulfill our obligations under the contract as soon as we reasonably agree you have fulfilled yours.

It now appears you are not willing to have a meeting as to reasonableness until payment of the third instalment is made into your bank account. We see this as an unreasonable approach to a condition you have agreed to in the contract.

As previously stated, we believe your inability to even accept feedback from us and the team that you were maybe struggling with the transition, over a long period of time, as a major contributor to the problem we now face. We have both communicated, under good faith, and now given you formally, comments we have received in this regard which we were relying on to aid in transition discussions. This was done in an effort to help you fulfill your obligations."[57]

"... we continue to want you to come to a reasonable agreement to move forward[58]

and later We feel and have always felt, that this is something we can sort out without the need for lawyers."[59]

1. The applicant's response to that email correspondence is not known however on

20 May 2024 she commenced treatment with a Dr Ho from My Family Doctors at Five Dock where she says that at her first consultation she advised the doctor of the stress she was feeling at work with bullying.[60] 2. The applicant's evidence is that after "several meetings and interactions"[61] a plan was agreed (presumably in relation to transition of clients) which afforded her some relief. 3. The applicant further stated that on 18 June 2024 she was involved in a board meeting with the directors of the respondent where an issue concerning the introduction of a client to a partner of the respondent was discussed. The applicant states that she felt highly anxious at the meeting and left as soon as she could.[62] 4. It appears however that the agreed plan was not being effected to the respondent's satisfaction with Mr Cox stating that by July he proposed a settlement to the applicant whereby she would resign, she would be paid her leave entitlements and if her clients were retained by the respondent she would be paid the balance of the purchase price in a year's time.[63] 5. In his statement Mr Cox stated that no response was received to the proposal and it was assumed the offer was rejected.[64] 6. Mr Cox further stated that between July and September 2024 the respondent continued transitioning clients from Modderno and Co Pty Ltd to the respondent's practice with five partners in the firm assisting with the transition process.[65] 7. Mr Cox states that as the transitioning of clients was being effected he started being informed of problems those partners were finding with the quality of the applicant's work including double claiming expenses and other errors resulting in clients getting larger refunds than they were entitled to.[66] 8. Mr Cox asserts that in around August 2024 he raised the quality issues with the applicant and states further:

"This was probably the first time anything to do with her employment had ever really been questioned because I mentioned that I had a quality review coming up, and this was an issue. I raised it with her individually, in writing, and in a board meeting. I initially focused on one issue, probably the easiest one to understand, to get an understanding of what was going on. I never accused her of doing the wrong thing: I simply questioned her thought process and the potential quality issue, and I never got a satisfactory response."[67]

1. It appears from Mr Cox's statement evidence that the process involving queries about work quality went on for some time in August/September 2024 with Mr Cox stating that he would have 50 emails with examples of queries about work quality[68] and getting unsatisfactory responses from the applicant.[69]
2. For her part the applicant states that she commenced receiving psychological treatment from Carol Hayek psychologist on 25 June 2024 and that Mr Cox started questioning her about her work performance in August 2024.[70]
3. The applicant asserts that her mental health continued to deteriorate, and she spoke to a solicitor about making a claim for workers compensation for her mental health condition on

9 September 2024.[71] 4. Mr Cox in his evidence asserts that on 10 September 2024 he had a meeting with the applicant where he expressed the view that "the quality issues were starting to get out of control"[72]and that he needed a response from the applicant to the issues that he had been raising with her. 5. Mr Cox states that the applicant's response was that she was too busy and was working weekends and had not had a holiday for a year.[73] 6. Mr Cox went on to state that:

"In that meeting, she was upset, saying she couldn't do it anymore and didn't want to do tax returns. She admitted she was making uncharacteristic mistakes too often. Basically she said she would like to stop doing tax returns and transition the clients."[74]

1. Mr Cox states that his response was to the effect that:

"I couldn't pay her just to transition as that was what the business sale entailed. I offered to come up with one other commercial solution, she thanked me and was happy for me to put together at that time."[75]

1. Following the meeting Mr Cox put a proposal to the applicant which apparently elicited a response from the applicant seeking more money.
2. On 12 September 2024 there was another meeting between the applicant and Mr Cox where he appears to have essentially put the offer on a take it or leave it basis which was then accepted by the applicant in writing.[76]
3. The offer in broad terms appears to have involved the applicant being paid a settlement amount under the contract for the purchase of the business of Modderno and Co Pty Ltd, the applicant would resign effective 30 September 2024, she would be paid her accrued leave entitlements and the respondent would handle the transition of clients without her assistance.[77]
4. The applicant claims to have found the meeting distressing resulting in her seeing her doctor that afternoon and she was issued a medical certificate on the basis of being certified as unfit for work the following day.[78]
5. Despite her certification the applicant apparently emailed Mr Cox on 13 September 2024 accepting the offer but just after sending that correspondence she forwarded to Mr Cox the medical certificate obtained the day previously.
6. Mr Cox instructed the respondent's solicitor to prepare "settlement documents" on the basis of the agreed resolution.[79]
7. On 16 September 2024 the applicant provided another medical certificate certifying her unfit for work until 18 September 2024. Essentially it seems that the applicant was absent from work between Friday 13 September 2024 and Wednesday 18 September 2024.[80]
8. On 18 September 2024 there was a meeting between the applicant and Mr Cox where

Mr Cox raised issues in relation to the quality of the work being performed. He also advised that he would be providing settlement documents in connection with the newly agreed terms for resolution of the sale of the business of Modderno and Co Pty Ltd which documents were provided to the applicant that day.[81] 9. The applicant's evidence is that she started to notice her hands shaking that morning and decided to go home where she had a sleep because she wasn't feeling well. When she woke up after the sleep she found that she couldn't concentrate and did not attempt to do any more work that day.[82] 10. On the following day when she attempted to login to the work computer from home she found that her emails had been cut off and that she couldn't log in. At the same time she also discovered a text message and attached letter sent by Mr Cox the day before advising her that she had been suspended while an investigation was being carried out. On the same day the offer made in relation to the settlement of the sale of the business was withdrawn.[83] 11. As noted by the applicant in her statement evidence the letter advising her of the suspension from duties does not specify what the allegations were that were being investigated rather it simply states that serious allegations regarding her conduct had been made. Equally the letter does not state that any decision had been made concerning the allegations but rather prescribed certain conduct while the investigation was being carried out.[84] 12. The applicant states that following her reading of the text message and attached letter she was:

"...beside herself with distress, anxiety, bewilderment and a feeling of helplessness. I was shaking and could not stop crying."[85]

1. The applicant subsequently saw her doctor on or about the 25 September 2024[86] and obtained a SIRA certificate of capacity certifying her as having no current work capacity.
2. A claim for workers compensation benefits was then made by the applicant.
3. Mr Cox states that the reason for the issuing of the text message and attached notice of suspension was that after lunch on 18 September 2025 he was made aware of a situation involving one of the clients where the applicant may have been involved in creating two separate sets of accounts for the client and had then sought to effect a cover-up as to what had occurred.[87]
4. Mr Cox states that:

"this was clearly a huge breach within the industry and her length of service within this industry would suggest she was well aware of what she was doing and potentially trying to cover up."[88]

1. Mr Cox further states that in the course of the investigation into the applicant's conduct there was a review of her work emails on 19 September 2024 that showed that she had been providing confidential information to her partner a Mr Michael Smith however it appears that particular issue was not the reason for the decision to suspend the applicant but rather something that arose subsequently.
2. Mr Cox states that the allegations of creating two sets of accounts, attempting a cover up and provision of confidential information to a third party have not been raised with the applicant as she had made a workers compensation claim.[89]
3. The applicant's version of events in relation to the alleged creation of two sets of accounts is that the problems were essentially caused by the actions of her former employee Robert Voncina (who was now working for the respondent) making mistakes and then involving her in balancing of accounts without informing her as to what had transpired in the past.[90]
4. The applicant also denies improperly providing confidential information to a third party.[91]
5. The applicant's claim for workers compensation benefits was initially accepted and weekly compensation was paid.[92]
6. It appears that after further investigation and consideration the respondent decided to decline the claim and issued a notice under s 78 of the Workplace Injury Management and Workers Compensation Act 1998 (s 78 Notice) denying liability relying on ss 4(a), 4(b),9A and 11A(1) of the Workers Compensation Act 1987 (the 1987 Act).[93]
7. The current proceedings were commenced by the applicant on 9 June 2025 with the applicant seeking weekly compensation benefits under s 37 of the 1987 Act.
8. The matter came before me at a preliminary conference on 10 July 2025 where the matter was not capable of resolution.
9. The matter was listed for a conciliation/arbitration hearing on 18 August 2025 and on that date Mr Ross Hanrahan of counsel appeared on behalf of the applicant instructed by

Ms Catherine McKay of McKay Compensation Lawyers and Mr Tom Grimes of counsel appeared on behalf of the Respondent instructed by Ms Maddi Chaplin of Bartier Perry Lawyers. 10. The matter was not capable of resolution during the conciliation phase of the conciliation/arbitration hearing and the matter proceeded to hearing. 11. Mr Grimes advised that the respondent no longer pressed the denials of liability under ss 4(a),4(b) and 9A of the 1987 Act and that the respondent's defence to the applicant's claim solely relied on a defence under s11A (1) on the basis that the applicant's accepted psychological injury was wholly or predominantly caused by reasonable action taken by the respondent with respect to discipline. 12. The respondent does not dispute that the applicant has no current work capacity as at the present date. 13. As I understand it the applicant's pre-injury average weekly earnings (PIAWE) as at the date of hearing is calculated and agreed as being $2,884.60 being the indexed amount at the date payments ceased.

1. The parties agree that the following issue remains in dispute:

(a) whether the applicant's accepted psychological injury was wholly or predominantly caused by reasonable action taken or proposed to be taken by the respondent with respect to discipline.

PROCEDURE BEFORE THE PERSONAL INJURY COMMISSION

1. I am satisfied that the parties to the dispute understand the nature of the application and the legal implications of any assertion made in the information supplied. I have used my best endeavours in attempting to bring the parties to the dispute to a settlement acceptable to all of them. I am satisfied that the parties have had sufficient opportunity to explore settlement and that they have been unable to reach an agreed resolution of the dispute.

1. The following documents were in evidence before the Personal Injury Commission (Commission) and considered in making this determination:

(a) Application to Resolve a Dispute and attached documents (Application), and

(b) respondent's Reply and attached documents (Reply).

1. As stated above the only issue for decision in the matter is whether the respondent establishes a defence under s 11A of the 1987 to the applicant's claim for weekly compensation.
2. Section 11A relevantly provides:

"11A No compensation for psychological injury caused by reasonable actions of employer

(1) No compensation is payable under this Act in respect of an injury that is a psychological injury if the injury was wholly or predominantly caused by reasonable action taken or proposed to be taken by or on behalf of the employer with respect to transfer, demotion, promotion, performance appraisal, discipline, retrenchment or dismissal of workers or provision of employment benefits to workers.

(3) A 'psychological injury' is an injury (as defined in section 4) that is a psychological or psychiatric disorder. The term extends to include the physiological effect of such a disorder on the nervous system."

1. As stated above Mr Grimes confirmed that the issue for determination was whether the applicant's accepted psychological injury was wholly or predominantly caused by reasonable action taken by the respondent with respect to discipline.
2. As counsel's submissions have been recorded I will not provide a detailed recitation of same however Mr Grimes in summary argued that I would prefer the respondent's witnesses version of events and that the applicant's evidence was unreliable, that her interactions with the respondent's directors were clearly matters involving disciplinary matters, that looked at objectively the actions taken by the respondent were reasonable and that I should prefer the evidence of the respondent's qualified doctor Dr Sanu Sudhakar to the applicant's medical evidence as Dr Sudhakar was the only doctor who had a complete and correct history as to what had occurred.
3. I found the submissions of Mr Hanrahan a little difficult to follow at times which may have been a product of the time pressures he was under to complete same on the day however as I understand the thrust of those submissions Mr Hanrahan was arguing that the applicant was being asked to complete work duties without proper support and with nebulous and impossible to achieve requested outcomes. Accordingly disciplinary action based upon a failure to achieve the respondent's desired outcomes could not be reasonable action taken by the respondent with respect to discipline. Mr Hanrahan submitted that the predominant cause of the applicant's psychological injury was her overall treatment from the time the bargain was struck and the sale contract entered into with that overall treatment including the applicant having to do extra work with less support.

1. The applicant relies on the qualified opinion of Dr Erin Dougherty consultant psychiatrist as set out in a medical report dated 6 June 2025.[94]
2. The following paragraphs summarising the history recorded by Dr Dougherty are based upon that part of Dr Dougherty's report at pages 71 to 73 of the Application.
3. Dr Dougherty recorded a history that the applicant had sold the business of Modderno and Co to the respondent as she was looking to scale down her work with a view to retirement. After the sale she commenced work with the respondent effectively working as a senior accountant.
4. Dr Dougherty further recorded that for the first 12 months of her employment things "were going along okay" but that she was not given the staff or opportunities to hand over her clients to other members of the firm and that as a consequence her workload was very high and she was working over 60 hours per week. The applicant raised her concerns about the workload and lack of opportunities to hand over her clients in May 2023 but nothing was done. The applicant also advised Dr Dougherty that the applicant was not provided with proper training about the respondent's computer system and other company processes and when she made mistakes she was ridiculed for them.
5. Dr Dougherty's further records that applicant as stating that on 17 October 2023 she was called into a meeting with two of the company directors where she was handed a summary of profit margins in parts of the business. The applicant questioned the accuracy of the figures and one of the directors raised his fist and punched the table and began harassing her. The applicant stated that she had fulfilled her side of the contract with respect to the amount of the billings and had no obligation to continue to work.
6. The history obtained by Dr Dougherty went on to record that following that meeting on

17 October 2023 the harassing behaviour the applicant was experiencing increased with the applicant being spoken to in disrespectful tones and at times ignored. She was often called into the boardroom to be ridiculed in front of others, questioned over trivial things, never given guidance or support when she made a mistake and had the sense of being laughed at behind her back. 7. Dr Dougherty recorded the applicant as having stated that following the meeting on

17 October 2023 her mental state began to deteriorate when it became clear she would not be given additional resources to do her work. She began to experience anxiety and was unable to cope with the high demands of work. She began ruminating on what was happening and developed a disturbed sleep pattern. She was skipping meals and craving unhealthy food. 8. The applicant advised Dr Dougherty that her mental state continued to deteriorate over several months whereby she was experiencing frequent panic attacks by April 2024. She began to experience ants in her stomach and her mood became very sad. She became easily rattled and frustrated. Her concentration and memory deteriorated. (It should be noted that the precise timing of the onset and worsening of some of those symptoms is unclear in the history as recorded by Dr Dougherty). 9. The applicant's history to Dr Dougherty went on to state that the applicant had the sense the board were trying to get rid of her and that a colleague (on an unspecified date) had been taken into the boardroom and asked by the directors if she knew of wrong doings by the applicant. 10. The applicant stated to Dr Dougherty that by September 2024 her panic attacks were occurring hourly. 11. The final part of the applicant's history as recorded by Dr Dougherty dealt with events in September 2024 with the applicant telling Dr Dougherty that by September 2024 she was exhausted by her workload and the stress she experienced in the workplace and requested leave which was refused despite her having six weeks accrued annual leave and 120 hours of personal leave available. The applicant stated that the refusal of her request for leave had exacerbated her distress and she went to her doctor and was certified unfit for work the following day (which was a Friday). The applicant stated that she did not recover over the weekend and obtained a further medical certificate from her doctor and did not return to work until the Wednesday but when she did she found herself trembling and went home for the afternoon. The following day she received notice of suspension from her employer. 12. Dr Dougherty recorded the applicant as stating that she was not aware of the suspension or any alleged disciplinary issues until she was at home after leaving work on the Wednesday due to her trembling and inability to cope. 13. Dr Dougherty only recorded the applicant as referring to one other stressor being the death of the applicant's mother in February 2024 which the applicant stated as being an event that she did not feel to have been heavily impactful given her mother's age and being an expected event.[95] 14. In her opinion Dr Dougherty diagnosed the applicant as suffering a major depressive disorder[96] which the doctor related to the:

"... bullying and harassment she experienced during her employment with the insured. The long work hours and high demands of her role whilst working with the insured also contributed."[97]

1. Dr Dougherty disagreed with the opinion of Dr Sanu Sudhakar that the main cause of the applicant's condition was the allegations of serious misconduct and subsequent suspension.[98]
2. In terms of evidence from the applicant's treating medical practitioners the applicant relies upon a number of reports and clinical records.
3. The applicant's treating psychologist Carol Hayek has provided a report addressed to the applicant's solicitor dated 24 April 2025 with annexures and an undated report to the workers compensation insurer.[99]
4. In her report of 24 April 2025 Ms Hayek records that she first commenced treating the applicant on 25 June 2024 and received a history that on 17 September 2023 the applicant had been at a meeting with a Mr Reason,[described as (partner ProYou)], when Mr Reason had slammed the boardroom table and screamed at her when she questioned his "incorrect accounting figures."[100] Ms Hayek further recorded that since the meeting a Mr Cox [also described as (partner ProYou)], had a constant pattern of belittling and demeaning behaviour towards the applicant.
5. Ms Hayek also refers to the applicant having provided copies of emailed correspondence which Ms Hayek stated was consistent with an appearance that Mr Cox's behaviour was motivated by a desire for secondary gain and which behaviour was consistent with elder abuse, bullying and harassment.
6. Attached to Ms Hayek's report of 24 April 2025 are a series of emails the first from the applicant to Messers Cox and Reason dated 1 May 2024, Mr Cox's reply dated

14 May 2024, a composite email involving the applicant and Mr Cox with questions and responses dealing with transition of business issues and support dated 17 June 2024 and a copy of an undated document headed "For Discussion with Sue about assisting with "Letting Go."[101] 7. I have reviewed those emails (most of which were otherwise in evidence and relied upon by me as being part of the material forming the basis of the Background summary in this decision) and do not agree with the characterisation of same by Ms Hayek. The correspondence is consistent with parties in a commercial arrangement dealing with a dispute about performance of same including some elements of work performance. I see no basis to assert that the behaviour of Mr Cox was motivated by a desire for secondary gain nor that the behaviour was consistent with elder abuse, bullying and harassment despite the fact that the applicant may have perceived the behaviour as bullying and harassment. 8. Ms Hayek diagnosed the applicant as suffering from a major depressive disorder with anxious distress and trauma related symptoms associated with workplace bullying and elder abuse.[102] 9. I find Ms Hayek's report to be very partisan in approach and of limited assistance given the clear impression of being an advocate rather than a witness in the proceedings. 10. Ms Hayek does however confirm that Ms Hayek first started treating the applicant for her psychological problems on 25 June 2024. 11. Ms Hayek's undated report to the workers compensation claims team does not assist greatly with the issue in dispute - it simply states that the applicant has significant anxiety and distress as a consequence of a workplace injury[103] and then details treatment and progress up to 23 December 2024. 12. Dr Phong Ho has provided an undated response to a question (presumably from the applicant's solicitors) where he was asked:

"In turn we request that you identify the whole or predominant cause of the psychological injury, specifying the particular events, meetings, interactions and conversations which are responsible."[104]

1. Dr Ho's response to that request was in the following terms:

"On 12/09/2024 Susanne Modderno consulted me regarding psychological distress due to harassment and bullying at her workplace which she stated began at the end of Oct 2023. She describes numerous episodes of being criticized at work and felt that she was being harassed every day at work.

On 17/10/2023 during a boardroom meeting when Susanne raised issue with the accuracy of figures in a report she was met with outburst from Troy who raised his voice and punched the boardroom table with his right fist. This shocked and scared Susanne. She felt intimidated and bullied as a result of this.

Susanne describes multiple episodes from Oct 2023 of David and Troy continued harassment of her with regards to her work and introduction of clients. Susanne has provided myself with a report from her that further describes incidents on 30/04/2024, 01/05/2024 + other incidents please see attached report 'Statement of Claimant.'

Given the reported events in the report and the continued bullying Susanne has developed anxiety and depression as a result which in turn has affected her ability to perform at work."[105]

1. Unfortunately the "attached report" is not attached to the report of Dr Ho accordingly the contents of the "attached report" and the accuracy of same cannot be ascertained or tested.
2. As a hearsay report of an unproduced document that part of Dr Ho's report will be given little weight.
3. It is to be further noted that Dr Ho's opinion makes no reference to the applicant's suspension from work on 19 September 2024 nor to the associated allegations of misconduct despite being asked to consider same as part of his opinion on causation.
4. Significantly however Dr Ho confirms treating the applicant for psychological distress on

12 September 2024 one week prior to the events of 18/19 September 2024. 5. The medical records of My Family Doctors of Five Dock record that Dr Phong Ho first started treating the applicant on 20 May 2024 for a persistent cough.[106] 6. In the consultation on 20 May 2024 the applicant also reported that she was "currently quite stressed at work; bullying."[107] 7. The records of My Family Doctors only refer to two further events between the consultation on 20 May 2024 and 12 September 2024 which events are rather cryptically described as

"3rd Party consultation." It is impossible to determine what those events entailed by way of complaint or treatment. 8. From the notes of My Family Doctors it appears that the applicant next saw Dr Ho on

12 September 2024 when the doctor recorded the following history:

During a board meeting in 2023 a director frightened patient by bang hand onto table

This year April pt was advised by a director that he doesn't want her there

Finding very hard to do job due to ongoing bullying and harassment

Offered psychology, pt will try contact her own psychologist

Discussed possibility of workcover, pt will think about it."[108]

1. The applicant then appears to have seen Dr Ho on 16 September 2024 where the following history was recorded:

But very anxious about going back to that enviroment (sic)

Recommended to see her own psychologist."[109]

1. The final relevant attendance on Dr Ho appears to have occurred on 25 September 2024 when Dr Ho recorded the following:

"pt went back to work half day on Wednesday last week

Then later that PM the offer was withdrawn and pt was suspended

Lawyer has now advised pt to do a worker compensation claim

25/09/2024 - long history of bullying and harassment of pt at work since end of Oct 2023. Her mental health has significant declined since then due to the ongoing bullying. Currently unable to work due to this. Seeing Carol at Psyclinx..."[110]

1. At page 139 of the Application there is a copy of notes of Dr John Yanco from Ramsay Street Medical Centre referring to a consultation with the applicant on 3 May 2024 which simply refers to a consultation for "anxiety" with no history recorded but which attaches a referral from Dr Yanco of the applicant to Psyclinx Clinic.[111]
2. The respondent relies upon the medical opinion of Dr Sanu Sudhakar as set out in his medical report dated 18 February 2025[112] and his supplementary report dated

10 March 2025.[113] 3. In his record of the applicant's history at the time of examination Dr Sudhakar relevantly recorded:

"Ms Modderno reported that the alleged aggressive behaviour exhibited by David and Troy towards her during a meeting concerning staffing in October 2023 led to a perception of being attacked and belittled in multiple instances.

For the past four months, since approximately June 2024, she has reported experiencing what she describes as 'little games' and daily harassment from her colleagues, particularly from the managing partner, David and a junior colleague, Matt. She alleged that they would belittle her, attribute blame for client-related issues to her and create a hostile work environment intended to compel her departure.

Ms Modderno recollected a specific incident that occurred in July or August 2024. She introduced a client to Matt, who was mistaken by the client for an intern due to his youthful appearance. When Ms Modderno corrected the client, informing him that Matt was a chartered accountant, Matt reportedly communicated this to David, framing the situation as her fault. She expressed that interactions were consistently misrepresented as personal attacks against her.

In August 2024, while completing a tax return with Matt, Ms Modderno made a mistake when filing an Income Tax Return for a client. Matt informed David about this error, and after the client had departed, David allegedly confronted her in her office, accusing her of an error. She perceived this situation as unjust, asserting that Matt had not raised the issue when it could have been rectified.

Ms Modderno claimed that her request for leave was denied on 12/09/2024. In light of this, she reported feeling overwhelmed and stressed, ultimately taking sick leave from September 12 to September 17,2024, after consulting her GP. She mentioned intending to work from home on September 18,2024 but encountered difficulties accessing her account. On September 19, 2024 she discovered that she had been locked out of work systems and suspended without explanation. Consequently, she expressed significant difficulty coping with stress at work and began experiencing panic attacks, tremors, and episodes of crying."[114]

1. I note that Dr Sudhakar's history does not include any record of the various meetings between the applicant and Mr Cox and Mr Reason in April and May 2024 that have been outlined the summary of events under the heading "Background" above and I also note that the suggestion of onset of significant difficulty coping with stress at work, panic attacks, tremors and episodes of crying is not consistent with the applicant's statement evidence nor with the medical records.
2. The absence from Dr Sudhakar's history of those significant events in the history must affect the weight given to his opinion as a fair climate for his opinion has not been created.[115]
3. I particularly note that Ms Hayek specifically records that at the time the applicant first presented for assessment she was visibly distressed and tearful throughout.[116]
4. When seen by Dr Ho on 12 September 2024 the applicant was very upset, anxious, tearing and crying.[117]
5. Dr Sudhakar diagnosed the applicant as suffering from an adjustment disorder.
6. Dr Sudhakar expressed the following comment in relation to his diagnosis of an adjustment disorder:

"I have diagnosed Ms Modderno with the psychiatric condition of adjustment disorder. A defining criterion for adjustment disorder is the presence of significant impairment. Although she exhibited symptoms of anxiety beginning in October 2023 these symptoms did not meet the threshold of a diagnosable condition until September 19, 2024 when she reported an inability to continue her professional responsibilities."[118]

1. I find that comment perplexing having regard to the evidence in the treating doctors and psychologist's records and reports.
2. The applicant was diagnosed with anxiety on 3 May 2024 and was referred for treatment to a psychologist.
3. The psychologist recorded the applicant as appearing visibly distressed and teary on her first consultation and apparently diagnosed her as suffering from a major depressive disorder.
4. The applicant saw Dr Ho on 12 September 2024 (which of course is prior to any events on 18 September 2024) when the applicant was certified as unfit for work as a result of anxiety.
5. In my view there is clear evidence of a diagnosable condition prior to 19 September 2024 and clear evidence of incapacity for work prior to that date.
6. Accordingly I find Dr Sudhakar's opinion that there was no diagnosable condition prior to

19 September 2024 unconvincing. 7. In relation to the causation of the applicant's condition Dr Sudhakar expressed the following opinion:

"In my opinion, the condition of adjustment disorder is more likely to have arisen out of the course of her employment. The allegation of serious misconduct and the subsequent suspension form her employment is primarily responsible for the injury. This is because there is a clear temporal relationship between the onset of symptoms and impairment with the event on 18/09/2024."[119]

1. That opinion of Dr Sudhakar on causation in my view suffers from the same issue as his opinion as to when the applicant developed a diagnosable condition namely that it is not consistent with the evidence.
2. As noted the applicant had been off work and certified unfit in the days prior to

18 September 2024 with a diagnosis of anxiety, the applicant was being treated by a psychologist for her psychological illness since June 2024 and she was diagnosed with anxiety on 3 May 2024 and had been certified unfit at that time. The temporal relationship between symptoms and impairment commenced well before 18 September 2024. 3. The applicant's evidence (which on this point is consistent with Mr Cox's evidence) is that on the morning of 18 September 2024 there was a meeting between them about work quality and also the terms of a settlement that had been agreed whereby the applicant would be paid an agreed sum and would exit the respondent's practice. 4. The applicant was not at that time the subject of any allegation of serious misconduct. 5. The applicant states that she developed shaking of hands and was feeling unwell at that time and went home. The applicant would have been unaware of any actual or proposed disciplinary action as at that time. 6. On the following day 19 September 2024 the applicant found her emails cut off and received a text message attaching a letter of suspension for unspecified serious misconduct. 7. Dr Sudhakar's opinion as to the existence of a significant event on 18 September 2024 is not borne out by the evidence. 8. Even if one accepts that Dr Sudhakar has intended to refer to events on 19 September 2024 his opinions as to causation of the applicant's diagnosed adjustment disorder and the relationship to the alleged disciplinary action[120] fail to take into account the evidence of an established psychological illness and incapacity prior to that date. 9. Dr Sudhakar's supplementary report restates his view that it was the disciplinary action on

18 September 2024 that was primarily responsible for the applicant's adjustment disorder without dealing with the evidence of established psychological illness and incapacity prior to that date.

1. The applicant relies upon a statement prepared by her dated 9 June 2025 and three statements by lay witnesses being Maribel Dreyer, Jonathon Smith and Michael Smith.
2. The respondent's statement evidence consists of statements from David Cox, Troy Reason, Robert Voncina and a statement from the applicant dated 29 October 2024.
3. Much of the relevant content of the statements of the applicant, Mr Cox and Mr Reason has been referred to earlier in this decision.
4. The statement by Mr Jonathon Smith dated 6 June 2025 details that he is an accountant who sold his business to the respondent with effect from 1 April 2022 and then commenced working for the respondent gradually reducing his work hours over time with a view to retirement.[121]
5. The arrangement between Mr Smith and the respondent is very similar to the arrangement between Modderno and Co Pty Ltd and the applicant on the one hand and the respondent on the other.
6. Mr Smith details in his statement that when he sold his business to the respondent he had about 800 clients which he managed with the assistance of an employed accountant and a personal assistant, Maribel Dreyer.[122]
7. When Mr Smith commenced employment with the respondent Ms Dreyer was also employed by the respondent and a Karianne Doherty accountant employed by the respondent was given the role of being a dedicated support to Mr Smith for the purpose of facilitating the transition of clients from Mr Smith's firm to the respondent's business.[123]
8. This description of the arrangement with Mr Smith is consistent with the applicant's evidence as to her expectations as to what was to occur post completion of the sale contract.
9. Mr Smith described a system whereby he would personally introduce his clients to Ms Doherty and then Ms Doherty, Ms Dreyer and the applicant would transfer the client to the respondent's data bases after which Ms Doherty would take responsibility for ongoing servicing of the needs of those clients. Mr Smith stated that "This arrangement worked very well."[124]
10. Mr Smith further stated that "after the said two-year period and even into the third year, Karianne Doherty was well established within my client base and had done a marvellous job in assisting in the transition of those clients".[125]
11. Mr Smith stated that the applicant started work with the respondent one month after he did and that the terms of the acquisition of Modderno and Co Pty Ltd's business was similar to his arrangement with the respondent.
12. Mr Smith further stated that while he had been provided with a qualified employee to facilitate the transition of clients that did not occur in relation to the "Modderno acquisition" for many months later when a Mr Wehbe was employed to provide dedicated support to the applicant in the transition process.[126]
13. Mr Smith stated that he formed the view early on that the applicant and Mr Wehbe's working relationship was not successful with Mr Wehbe having issues with and resenting instructions or directions from the applicant and being openly disrespectful to her.[127]
14. Mr Smith's comment is that the working relationship between the applicant and Mr Wehbe was not conducive to the successful transition of clients which contrasted with the seamless experience he had with Ms Doherty.[128]
15. Mr Smith confirmed that after some months Mr Wehbe was moved to another team within the business but nobody was hired to replace him.[129]
16. Mr Smith stated,

"It was my impression Susanne was not provided sufficient resources to successfully/efficiently transition her former business clients to ProYou's systems and when she began to voice her concerns to Management about it, the relationship between Susanne and Management soured."[130]

"I believe that it would have been difficult for Susanne to allocate work to existing employees or accountants employed within ProYou, to willingly take on the responsibility of large numbers of additional clients given the existing high workloads.

I observed the difficulties Susanne had in this regard, and I believe it would occupy the bulk of her time simply ensuring that time sensitive 'work in progress' was completed to the levels required by management, ie to achieve preset budgets. This would have left her little time to transition clients in the expected manner."[131]

1. This evidence is consistent with the applicant's evidence as to her workload and her difficulties managing same.
2. To Mr Smith's observation by mid-2023 the applicant was becoming increasingly stressed and frustrated.[132]
3. Mr Smith's statement states that,

"Prior to my retirement in March 2024, I had become aware of a significant change(decline) in the personal demeanour of Susanne and was well aware of the circumstances experienced by her. This in itself had become of some concern to us. By the later part of 2024(sic) I believe the relationship had all but broken down.

Susanne's demeanour had changed, in that she seemed sad and had lost her spark. She was less communicative, didn't engage with everyone like she did previously. She often expressed frustration and disappointment."[133]

1. I consider the evidence of Mr Smith to be cogent and credible as being given by someone who appears, as far as is possible, to be a disinterested third party and I accept same.
2. Mr Smith's evidence is also corroborated to a large degree by the statement of Ms Maribel Dreyer dated 3 June 2025 who confirms the successful transition of the clients of Mr Smith to the respondent's practice with the assistance of a dedicated employed accountant

Ms Doherty, that a senior accountant was not provided to assist the applicant in the transition of the clients of Modderno and Co Pty Ltd, that Mr Wehbe (when he was eventually hired) was arrogant and difficult to work with, that the applicant was very stressed by the situation and that she observed the applicant becoming sad and depressed between the beginning of 2022 and the end of 2023.[134] 3. Ms Dreyer left the employment of the respondent in late 2023 and appears to have absolutely no reason to give anything but truthful evidence in the matter. I find her evidence to be cogent and credible. 4. The application also includes a statement from a Michael John Morris Smith dated 23 April 2025 however I do not consider the contents of that statement to be of much assistance in resolving the matters in dispute before me. 5. The respondent relies upon a statement from Robert Voncina dated 18 October 2024. 6. Mr Voncina is an accountant who was employed by Modderno and Co Pty Ltd prior to the sale of the business to the respondent. Mr Voncina was then employed by the respondent to assist with the work of the clients of Modderno and Co and worked with the applicant in the Parramatta office of the respondent. 7. Mr Voncina describes being in an office adjacent to the boardroom when a meeting took place between the applicant and Mr Cox and Mr Reason on 17 October 2023 when he heard loud talking slightly louder than usual conversation but nothing that struck him as being aggressive or alarming.[135] 8. Mr Voncina stated that a few days later the applicant advised him that Mr Reason had banged the table during the meeting.[136] 9. Mr Voncina's statement relevantly sets out details of a series of events in September 2024. 10. Mr Voncina states that he was travelling to work on the train when he was contacted by the applicant phoning him and stating that there was a problem with a client's financial statements. 11. Apparently the applicant had been contacted by the client who advised that the client had been contacted by their home warranty insurance provider which had flagged discrepancies between the financial statements provided by the accountant and what the home warranty insurer had on record.[137] 12. Mr Voncina stated that the issue needed to be fixed and to see her in her office immediately. 13. Mr Voncina's statement goes on to say that when he arrived and met with the applicant he was specifically asked by the applicant not to tell anyone that she was involved in the described situation. Mr Voncina stated that he initially agreed with this request and he thought of her as an older colleague that he did not want to see in trouble.[138] 14. Mr Voncina's further evidence is that later that day in the afternoon, after the applicant asked him to assist with the financial statements, Pancho, a senior director at the practice, approached him and asked what had happened. 15. Mr Voncina states that he initially informed the director that he, Mr Voncina had changed the figures. Shortly thereafter he advised the director of the applicant's involvement resulting in a meeting with Mr Cox and Pancho where he,

"detailed exactly what Susan had told me that morning - that we needed to fix the financial statements and that she asked me not to tell anyone she was involved."[139]

1. According to Mr Voncina's statement he was contacted that night by the applicant and the following morning he was again contacted by the applicant by phone while travelling on the train. He was asked in that conversation to tell Mr Cox that his previous statement was incorrect and that if he didn't do that he would be in serious trouble where it would his word against hers.[140]
2. Mr Voncina's statement goes on to record that when he got to work he was called into the office by Mr Cox and Pancho where he was suspended but where he also told them what had happened that morning.[141]
3. Apparently after that meeting a third-party investigator was brought in and after the investigation was completed Mr Voncina was offered the opportunity to resign which he did.[142]
4. I note that Mr Voncina no longer works for the respondent and has no interest in supporting one party or the other in the current litigation.
5. I find his evidence credible and accept the accuracy of same.
6. Where there are conflicts between the evidence of the applicant, Mr Cox and/or Mr Reason and the evidence of Mr Jonathon Smith, Ms Maribel Dreyer or Mr Robert Voncina I prefer the evidence of Messrs Smith and Voncina and Ms Dreyer.

1. Having regard to all the evidence it is my view on the balance of probabilities that the following paragraphs set out a correct summary of the factual background in this matter.
2. Modderno and Co Pty Ltd agreed to sell its accountancy practice to the respondent for the sum of $550,000 plus a further Fee Share arrangement calculated for the 12 months following Completion.
3. The sale price was to be paid in four instalments of $137,500 with the first payable on Completion and the final instalment payable 36 months from Completion.
4. The sale contract provided for an obligation on the vendor as part of its obligations under clause 26 (which ordinarily relates to training) to transition the vendor's client base to the respondent.
5. The sale contract did not impose any personal obligation on the applicant to effect the transitioning or transfer of the clients of Modderno and Co Pty Ltd to the respondent's business although it would ultimately be in her interests to do so as the contract created a right in the respondent to withhold payments of the instalments of purchase price until the vendor complied with its obligations to transition the clients.
6. At the time of completion of the sale contract the applicant also entered into the employment contract with effect from 1 May 2022.
7. The employment contract in evidence makes no mention of an obligation on the applicant to assist with the transitioning of clients of Modderno and Co Pty Ltd to the respondent's business although the respondent appears to have worked on the basis that the transitioning of clients would form part of the applicant's work duties.
8. The applicant expected that the respondent would assist in the transition process by provision of adequate staff and assistance.
9. It was in the interests of both the applicant and respondent that the acquisition of Modderno and Co Pty Ltd's business by the respondent would be a success as it would enable the applicant to aim for retirement with a significant capital sum added to her resources and it would enable the respondent to maximise its return on a significant capital outlay.
10. Despite Mr Cox's assertions to the contrary the respondent failed to provide adequate staff to assist with the transition of clients to the respondent's practice with no dedicated support from a senior accountant to whom clients could be transferred for many months until Mr Mark Wehbe was appointed to assist the applicant.
11. That during the time the applicant was working for the respondent she was servicing her clients with less support than she had previously while operating Modderno and Co Pty Ltd given the reduced staff available to her.
12. Mr Wehbe was uncooperative and difficult to work with and was transferred away from his role with the applicant to another part of the respondent's practice after three months.
13. The respondent did not appoint anyone to assist the applicant with her role between January 2023 and 17 October 2023.
14. The respondent was well aware of the desirability of having dedicated assistance in the transition process.
15. The applicant was stressed by the lack of adequate staff to assist with the transitioning of clients and to assist with the ongoing workload from the clients of Modderno and Co Pty Ltd.
16. The respondent was concerned by the slow pace of the transitioning of clients and called a meeting on 17 October 2023 to try and address the transitioning issues.
17. At the time of the meeting on 17 October 2023 there were no issues regarding her work performance or significant personality or work-related conflicts.
18. The meeting on 17 October 2023 was specifically called to discuss the transition of clients.
19. The meeting became somewhat heated with some raising of voices which is confirmed by the evidence of Mr Voncina.
20. I am unable to conclude that Mr Reason struck the table during that meeting as alleged by the applicant however I do accept that what occurred in the meeting was stressful and upsetting to the applicant and that thereafter she tended to perceive interactions between herself and Messrs Cox and Reason as involving bullying and harassment on their part however I do not accept that what occurred was actual bullying and harassment. In my view this was a case of interpersonal conflict as the reality is that it was in the interests of the respondent that a successful acquisition of the business and transition of the clients of Modderno and Co Pty Ltd occur.
21. That despite the respondent developing a further plan to effect the transition of clients in November 2023 the implementation of that plan did not produce the desired outcome with the vast majority of the clients of Modderno and Co Pty Ltd remaining un-transitioned (in the respondent's view) by late April 2024.
22. Due to the failure to effectively hand over the clients to other members of the respondent's staff the applicant's workload servicing the clients would have remained heavy between October 2023 and April 2024 and as a consequence the workload and the pressure from the respondent over the transitioning issue the applicant would have been stressed and pressured.
23. By late 2023 the applicant was visibly depressed and sad.
24. A further meeting was held between the applicant and Mr Cox and Mr Reason on or about 26 April 2024 when Mr Cox advised the applicant that the third instalment of the purchase price payable to Modderno and Co Pty Ltd would be withheld pending satisfactory arrangements being reached in relation to the transition of clients with, inter alia, it being suggested that the applicant should suggest her own plan if she was unhappy with what was occurring.
25. This meeting also appears to have been somewhat heated and the applicant was further distressed by same.
26. The applicant prepared a draft proposal by 29 April 2024 in relation to the issue of transition of clients which was rejected as incomplete and unsatisfactory.
27. A further meeting on 30 April 2024 involving the applicant and Mr Cox and Mr Reason was distressing to the applicant as she thought that she was being dismissed although Mr Cox subsequently clarified that the meeting was not about her employment but the obligations under the Business Sale Agreement in relation to the transitioning of clients.
28. It is my view that both the meeting on 26 April 2024 and that of 30 April 2024 were meetings that were essentially about issues in relation to the sale contract and the apparent failure on the part of the vendor to transition clients as anticipated and what could be done in that regard. In my view it is clear that Mr Cox regarded the meetings in the same way and specifically stated that position to the applicant.
29. It is clear that the applicant was distressed by the events in each of the meetings.
30. There was an exchange of emails between the applicant and Mr Cox on 1 May 2024 and 2 May 2024 where, inter alia, Mr Cox gave notice of an intention to give formal warning of to the applicant in relation to her actions (albeit that the content of the proposed warning was not set out nor did Mr Cox identify the alleged breaches that form the basis of any such warning).
31. On 3 May 2024 the applicant sought treatment for severe anxiety.
32. Further extensive email correspondence took place over the next few weeks between the applicant and Mr Cox about issues of transition of clients and obligations under the sale contract.
33. It appears that the applicant's psychological condition continued to deteriorate and she consulted Dr Ho on 20 May 2024 and was referred to a psychologist.
34. The applicant commenced treatment with Ms Hayek, psychologist, on 25 June 2024.
35. Between June 2024 and September 2024 the applicant continued to carry out work for the clients of Modderno and Co Pty Ltd while also being involved in the transitioning of those clients to the respondent's practice.
36. During that time Mr Cox became concerned about the quality of the work being done by the applicant and raised those concerns with her.
37. The applicant's mental health continued to deteriorate to the extent that by 9 September 2024 she sought legal advice in relation to a possible workers compensation claim.
38. Between 10 September and 12 September 2024 there were meetings and email correspondence between Mr Cox and the applicant in relation to work quality and transition of client issues with the applicant eventually receiving an offer that would involve finalisation of the relationships between Modderno and Co Pty Ltd, the applicant and the respondent.
39. The applicant was very distressed by the discussions and correspondence and she consulted Dr Ho on 12 September 2024 with anxiety and distress and was certified as unfit for work.
40. The applicant accepted the offer made by Mr Cox on 13 September 2024 but was further certified as unfit for work up to 18 September 2024.
41. On the morning of 18 September 2024 the applicant had a meeting with Mr Cox where issues about quality of work and the preparation of settlement documents was discussed.
42. That same morning the applicant contacted Mr Voncina about an issue with respect to a client concerning the accuracy of accounts or statements prepared for that client and she subsequently involved him in steps to deal with the issue without telling any other member of the respondent's firm.
43. Mr Voncina subsequently advised a director of the respondent about those events resulting in the applicant being suspended and the offer of settlement of the sale contract being withdrawn.
44. The applicant's psychological condition deteriorated further after being advised of her suspension.
45. As has been noted there the respondent's defence to the applicant's claim is based upon s 11A of the 1987 Act and the respondent confirmed that the defence is that the applicant's psychological injury was wholly or predominantly caused by reasonable action taken or proposed to be taken by the respondent with respect to discipline.
46. The respondent bears the onus of establishing that defence.[143]
47. To succeed the respondent must establish on the balance of probabilities:

(a) that the applicant's injury was wholly or predominantly caused by the action taken by the respondent;

(b) the action was reasonable, and

(c) the action was with respect to discipline.

1. The question of causation is one that in a case such as this needs to be addressed by medical evidence. As stated by DP Snell in Hamad v Q Catering Limited:[144]

"The extent to which aspects of the appellant's history contributed to causing the psychological injury was not, in the circumstances, something which could be decided in the absence of medical evidence. There may be cases in which causation of a psychological injury can be established without specific medical evidence, for example where there is a single instance of major psychological trauma, with no other competing factors. The need for medical evidence, dealing with the causation issue in s 11A (1) of the 1987 Act, will depend on the facts and circumstances of the individual case. In the current case, as in most, there are a number of potentially causative factors raised in the appellant's statement and the medical histories. Proof of whether those factors, which potentially provide a defence under s 11A (1), were the whole or predominant cause of the psychological injury, required medical evidence on that topic."

1. In this matter there are obviously a range of factors that could have been relevant to the applicant's development of her psychological condition including but not limited to excessive work load, lack of support, the conduct of parties in meetings, problems in transitioning of clients, discussion of the issuing of warning letters, errors in work, interpersonal difficulties between the applicant and Messrs Cox and Reason, suspension of payments under the sale contract, and suspension for investigation for misconduct.
2. Mr Grimes submitted that I should accept the qualified medical opinion of Dr Sudhakar as set out in his report of 18 February 2025 and supplementary report of 10 March 2025 as being based on a more comprehensive history than the applicant's medical evidence.
3. As noted at paragraphs 165-187 Dr Sudhakar expresses the view that the applicant's diagnosed adjustment disorder was caused by events on 18 September 2024 or 19 September 2024 when the applicant developed a diagnosable condition.
4. If Dr Sudhakar had recorded correctly the dates of onset of symptoms such as significant difficulty coping with stress at work, panic attacks, tremors and episodes of crying and had also dealt with the fact that the applicant had been variously diagnosed with anxiety and a major depressive disorder in May and June 2024 his opinion would carry more weight however given those deficiencies I do not find it persuasive and do not accept same.
5. This conclusion is particularly so when regard is had to the fact that Dr Sudhakar specifically states that "The allegation of serious misconduct and the subsequent suspension from her employment is primarily responsible for her injury."
6. The applicant had actually gone home on the afternoon of 18 September 2024 unwell with shaking hands following a meeting about the terms of settlement and work quality. There had been no mention of the alleged serious misconduct involving Mr Voncina at the time the applicant went home.
7. Even when the applicant received notice of her suspension the nature of any allegation of serious misconduct remained unstated.
8. Accordingly, the respondent's medical evidence fails to support a finding that the applicant's psychological injury was wholly or predominantly caused by disciplinary action taken or proposed to be taken by the employer (leaving aside the issue of reasonableness for the moment).
9. I do accept that the events of 18/19 September 2024 did aggravate the applicant's psychological condition as same clearly deteriorates further after those events to the extent that it is accepted that she has no current work capacity at the present time however I do not accept Dr Sudhakar's opinion that the whole or predominant cause of that condition was those events.
10. I accept that the issues involving Mr Voncina, the conflict between sets of accounts and the applicant's conduct relating to same are very serious matters and justified the respondent at that time taking steps to suspend the applicant and investigate what occurred and if the evidence supported that one event as being the sole cause of the applicant's condition then Dr Sudhakar's opinion would have more weight however as I have stated that is not the correct factual position.
11. Mr Grimes in his submissions also worked through a series of events that he characterised as being disciplinary in nature such as the meetings in October 2023, April 2024, August 2024 and September 2024 and the email correspondence in May 2024. He then went onto to effectively submit that those events were causative of the applicant's condition and were reasonable actions on the part of the employer.
12. The first difficulty with those submissions is that firstly they are not consistent with the respondent's medical opinion that Mr Grimes submitted should be accepted by me as the only one based upon a full and correct history being the opinion of Dr Sudhakar where the doctor had expressed the opinion that the whole or predominant cause of the applicant's condition was the allegation of serious misconduct and subsequent suspension on 18 September 2024.
13. The second difficulty with the submission is that it fails to deal with the significance of the evidence of over work, lack of support, the conduct of parties in the meetings referred to, the interpersonal conflicts between Mr Wehbe and the applicant, Mr Cox and the applicant and other stressors such as the suspension of payment of purchase price to Modderno and Co Pty Ltd none of which can be characterised as disciplinary actions.
14. This is even more significant when the medical evidence from the applicant's qualified psychiatrist Dr Dougherty is that the main cause of her condition was bullying and harassment and long work hours and high demands of her role and where the treating psychologist expresses the opinion that the cause of the applicant's condition was workplace bullying and elder abuse.
15. There is simply no medical evidence supporting the proposition that the applicant's psychological injury was wholly or predominantly caused by the meetings and correspondence identified by Mr Grimes as disciplinary action.
16. The third difficulty with Mr Grimes submission in relation to those meetings and correspondence and his characterisation of same as constituting disciplinary action is that quite clearly in my view some of those events were not disciplinary in nature.
17. The meeting on 17 October 2023 came about to try and develop a more effective method to effect transition of clients with Mr Cox stating they called the meeting to "specifically address the transition."[145]
18. The meeting in April 2024 was confirmed by Mr Cox as one where:

"We are not talking about your employment, we are talking about your obligations under the Business Sale Agreement to Transition clients."[146]

1. When the Managing Director of the respondent states that the meetings were about obligations under a Business Sale Agreement (to which the applicant is not a party) not the applicant's employment it is difficult to see how the meeting or consequent correspondence could be characterised as disciplinary action.
2. Accordingly, the respondent fails to establish on the balance of probabilities that the applicant's psychological injury was caused wholly or predominantly by reasonable action taken or proposed to be taken by the respondent with respect to discipline.
3. I accept the opinion of the applicant's qualified psychiatrist Dr Dougherty that she suffers from DSM-5 Major Depressive Disorder which is a diagnosis consistent with the opinion of the treating psychologist Ms Hayek.
4. The deemed date of injury is 25 September 2024.
5. There is no dispute that at the present time the applicant has no current work capacity.
6. The applicant was paid weekly benefits up until 19 March 2025.
7. The applicant's PIAWE as at 20 March 2025 is agreed to be $2,884.60.
8. There is an award in favour of the applicant pursuant to s 37 of the 1987 Act at:

(a) the rate of $2,307.68 per week from 20 March 2025 to 31 March 2025, and

(b) the rate of $2,317.60 per week from 1 April 2025 to date and continuing as indexed from time to time.

1. The parties to have liberty to apply in relation to the calculation of PIAWE and indexed amount.
2. There is an award pursuant to s 60 of the 1987 Act in favour of the applicant that the respondent pays the applicant's reasonably necessary medical and related expenses.

1. The applicant has suffered a primary psychological injury in the nature of a DSM-5 Major Depressive Disorder arising in the course of her employment to which her employment was the main contributing factor.
2. The deemed date of injury is 25 September 2024.
3. The respondent's defence under s 11A (1) of 1987 Act fails as the respondent has failed on the balance of probabilities to establish that the applicant's psychological injury was wholly or predominantly caused by reasonable action taken or proposed to be taken by the respondent with respect to discipline.
4. The applicant has no current work capacity.
5. The applicant was paid weekly compensation benefits up until 19 March 2025.
6. The applicant's PIAWE as of 20 March 2025 is agreed to be $2,884.60.
7. The respondent is to pay the applicant weekly compensation pursuant to s 37 of the 1987 Act as follows:

(a) from 20 March 2025 to 31 March 2025 at $2,307.68 per week, and

(b) from 1 April 2025 to date and continuing at $2,317.60 per week and increased as indexed from time to time.

1. The respondent is to pay the applicant's reasonably necessary medical and related expenses pursuant to s 60 of the 1987 Act.
2. Either party to have leave to apply for further orders in relation to the calculation of PIAWE or the calculated indexed amounts.

[86] Application p122 (not 23 September 2024 as stated in the applicant's statement).

[92] Application pp53-58 and Reply p42.

[115] Paric v John Holland Constructions Pty Ltd [1984] 2 NSWLR 505; [1985] HCA 58.

[143] Department of Education & Training v Sinclair [2004] NSWWCCPD 90.