NSWNSWSC

MONIE v COMMONWEALTH of AUSTRALIA

[2003] NSWSC 1141

Supreme Court of NSW|2003-12-04|Before: Dowd J

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At a glance

Source facts

Court

Supreme Court of NSW

Decision date

2003-12-04

Before

Dowd J

Source

Original judgment source is linked above.

Judgment (42 paragraphs)

[1]

Background Facts 2 Peter Monie, born 1928, married Jennifer Monie, born 1939, on 16 November 1961 from which marriage there were five children: Sally Barton, Annabel Sides, Sam Monie, Ben Monie and Michael Monie. The last named died on 3 November 1996. 3 Peter Monie and the family company, PJ Monie & Co Pty Ltd ("PJM & Co"), formed a trading partnership of a five thousand acre farming cattle stud property known as Thornleigh situated some thirty two kilometres from Bingara, Thornleigh having been in the family for many years having been well established by 1952. 4 In 1970 a partnership, which operated the farm known as "Thornleigh & Co", was entered between Peter Monie and PJM & Co to be divided as to 25% to Peter Monie and 75% to PJM & Co. The business was carried out on the property. 5 Peter Monie was issued with two A Class shares and his wife with two B Class shares. Each of the five children was allocated fifty shares with Mr and Mrs Monie as trustee for each child. On the death of Michael Monie, his shares were allocated half to each of Peter Monie and his wife. 6 As a result of amendments to the Social Security Act 1991 Peter Monie and his wife converted their shares in March 2002 into ordinary shares and they both resigned as Directors of the company. Their sons, Ben and Sam, were appointed Directors of the company and Ben was appointed Secretary. Peter Monie ceased to carry on the business of Thornleigh & Co which was then carried on by his son, Ben. For the sum of $123,700.00 each, Peter Monie and Jennifer Monie transferred their shares to Ben Monie. 7 Peter and Sam Monie decided in the late 1980s to establish a program to source breeding stock and import semen to Australia for breed enhancement to increase the cattle herd and profitability. As a result of that decision Sam Monie worked as a jackeroo in the Northern Territory for five months and after returning to Thornleigh travelled to Canada for some eight months to develop the stud venture. Sam Monie had completed his education as a boarder at a Sydney secondary college followed by twelve months jackerooing near Tamworth. 8 In February 1991, in addition to operating a commercial herd, Peter and Sam Monie commenced the marketing of cattle semen. Both participated in the day-to-day management of the property. In 1992 a live artificial insemination program was commenced at Thornleigh. The first calves of the artificial insemination program were produced in 1993. 9 On 19 November 1992 Thornleigh & Co employed a Martin Bostelaar as a farm hand for a period of twenty six weeks under the Commonwealth's "JobStart Scheme". Under this scheme there was a subsidy paid of $270.00 a week for twenty six weeks. He worked satisfactorily until he left of his own volition to take another position in February 1993. The JobStart programme was a Commonwealth scheme to assist in the employment of people who were disadvantaged in the employment market. 10 In March 1993 Sam Monie attended the Inverell CES as a result of which, a further JobStart Scheme employee, Michael Gallagher, was employed by Thornleigh & Co with a subsidy of $160.00 per week. 11 On 22 March 1993 Sam Monie sought from the CES at Inverell another employee to assist at Thornleigh as a result of which, on 24 March 1993, Darren James Winsor, was employed under the JobStart Scheme with a subsidy of $220.00 per week. 12 On 15 June 1993 Peter Monie was shot four times by Darren Winsor whilst in the home on the Thornleigh property. Peter Monie was admitted to Bingara Hospital on that day and was transferred on the same day to Tamworth Base Hospital where he was treated for bullet wounds to the right jaw, left arm, right collarbone and right wrist. 13 On 22 June 1993 Peter Monie was discharged from Tamworth Base Hospital. On that same day, Darren Winsor was arrested and charged with the attempted murder of Peter Monie. 14 In July 1993 Sam and Peter Monie attended the CES offices at Inverell and had a meeting with a woman, then Anne Morris, now Arca, being the person who had spoken to Sam Monie at the time of the employment of Darren Winsor. 15 In December 1993 the committal of Darren Winsor for the Attempted Murder took place at Inverell Local Court where Sam, Peter and Jennifer Monie gave evidence. 16 The trial of Darren Winsor was aborted on several occasions having been scheduled to commence on 20 May 1995 when it was adjourned, again in October 1995 when it was adjourned and in November 1995 when the trial was aborted. On 22 November 1995 a further trial was aborted. On each of these occasions, Peter, Sam and Jennifer Monie were required to attend to give evidence. 17 Although Winsor maintained his innocence, on 12 September 1997, Winsor was found guilty of Attempted Murder and sentenced to twelve years imprisonment with a minimum term of eight years, Winsor having been at large, although subject to strict bail conditions, pending trial. 18 From 1993 until March 1996 Sam Monie took over control and management of the family property and the operations being conducted. 19 In October 1993 Peter Monie suffered a stroke. On 21 April 1995 there was a dispersal of a significant number of the stud cattle from the Thornleigh property, a second dispersal occurring on 9 October 1995.

MONIE v COMMONWEALTH of AUSTRALIA - [2003] NSWSC 1141 - NSWSC 2003 case summary — Zoe

[2]

Duty of Care 20 In the amended Statement of Claim the plaintiffs pleaded negligence, in that the defendant failed to properly select for referral, suitable candidates for employment at Thornleigh and did not assess the location and the environment at Thornleigh. 21 It was further alleged that the defendant failed to disclose Winsor's long criminal history of dishonesty and violence and that they referred him as a suitable candidate for employment at Thornleigh without that disclosure. 22 It was further alleged that the defendant negligently, either expressly or impliedly, represented that all due care would be taken to screen and select only those persons suitable for the employer and that the person recommended for employment would not constitute a risk, knowing the risk. 23 It was further alleged by the plaintiffs that the defendant committed the act of negligence knowing and intending that the plaintiffs would rely on those representations. 24 It was further alleged that the defendant failed to warn the plaintiffs that they should rely on their own inquiries and that the defendant should have had a system which updated details of job seekers' backgrounds so as to reveal criminal convictions. 25 The plaintiffs, in support of the allegation of negligence, relied on the evidence that Winsor had some forty four convictions resulting in gaol sentences totalling eight months, the last of which sentences resulted in Winsor being released from gaol in December 1992. Winsor's criminal record included a number of juvenile offences. Most of the offences were for Dishonesty but included two offences of Break, Enter and Steal. There were convictions for Assault and Assault Occasioning Actual Bodily Harm, the latter resulting in a six month's imprisonment. The evidence was that Winsor was first registered at the CES at the age of sixteen years, which, it was submitted, would have disclosed his early offences, if they had not otherwise been disclosed. 26 The plaintiffs contended that the system of the CES was grossly deficient if it failed to provide for the updating of criminal convictions and that it was not reasonably expected, in the absence of an appropriate warning or disclaimer, that a job seeker be referred to a potential employer, particularly where there was a long string of convictions for dishonesty and violence. 27 The plaintiffs asserted that the CES had actual knowledge of Winsor's criminal record and relied on Exhibit "V" which was a job classification schedule produced under the JobStart system to cover, not just disadvantaged, but "especially disadvantaged" potential employees. This schedule was, however, not in existence at the time of the referral of Darren Winsor but it was put by the plaintiffs that this system, which records convictions, is an example of what ought to have been in place and that, in effect, there ought to have been a system obliging disclosure by the applicant for employment. 28 It was submitted by the defendant that the offence committed by Winsor was the very serious offence of Attempted Murder. There was no element of dishonesty and the previous convictions of Winsor did not involve firearms and the Assault convictions involved someone to whom Winsor was related. There was, thus, it was submitted, no relevant nexus between the criminal acts in the antecedents and the attack on Peter Monie. 29 It was further submitted by the defendant that the obligation to update criminal convictions must have some nexus with a duty to potential employers and that it must be remembered that the allegation by the plaintiffs that there was an obligation under "due care and common sense" was subject to laws as to privacy. The defendant contended that the role performed by the CES was to fulfil a referral function only, which made the task of a decision to employ that of Peter Monie. In his evidence, Peter Monie accepted that that was his responsibility and role. 30 The evidence of Mrs Arca referred to at T637-638 and T642-643 was largely unhelpful to the plaintiffs' case and did not evidence any system consistent with that alleged by the plaintiffs. At T672, Arca was asked whether there was any process that would reveal a history of being in gaol and other offences to which she replied: "Not that I remember, no." 31 The plaintiffs submitted that if the court were to accept that there was no breach by the defendant in the circumstances of there being no warning and no disclaimer, it would be an affront to community expectations and community sense. 32 Community attitudes are not necessarily rational and tend to expect that no matter what the nature of the fault, somebody will be responsible. As submitted by the defendant, community expectations do not give rise to a duty to make inquiries and, indeed, no evidence was produced that there was such a system. I am not satisfied, even if at some stage inquiries had been made of Winsor, that the CES was aware of his criminal convictions. 33 Arca did not interview Winsor for the position at Thornleigh nor did the other employee Fiona Brown. The evidence of Arca at T657 was that the use of Exhibit "V" was an administrative function and did not constitute a decision taken with respect to the referral of Winsor. The system for JobStart consisted of a financial subsidy to assist severely disadvantaged and job-seekers, a system which had been used twice previously by the plaintiffs, one being of recent weeks, to employ people. 34 At no stage was there any inquiry by the plaintiffs, or any of them, as to criminal antecedents. Whatever version be accepted regarding the interview between Peter Monie and Darren Winsor, as to who was present, it is clear that a conversation occurred in which Peter Monie made very limited inquiries, particularly in relation to references, and was more interested in the applicant's, being Winsor's, skills and experience, rather than his antecedents. 35 It is not suggested, in these proceedings, that anyone to whom the record of Darren Winsor were shown would necessarily employ him. The issue, however, is not as to whether someone has a "criminal record". The issue is the extent to which the defendant, or the CES, is obliged to check and communicate a criminal record. There may be people who would not mind a series of traffic offences for an employee and there may be people who would not employ a person because of a series of traffic offences. It may be that someone would not employ because of a minor matter of Dishonesty, but others who would not mind if someone had had an Assault conviction some four or five years ago previously. The issue is as to what is the system which is in place, not what the system shows. The plaintiffs assert that the CES has a duty to not only inquire of the environment where the potential employee is going to work, but requires that it have a system whereby every time an applicant for employment has a conviction then he or she must disclose it before the next referral to a prospective employer. 36 The prospective employer to whom the applicant for employment is referred is on notice of the person being disadvantaged in the employment market and is paid a subsidy for that very fact, whatever the nature of the employment is. Clearly the CES does not have power to carry out criminal history inquiries without the permission of the applicant. An applicant may, in fact, only disclose some offences and not others. An applicant may, for instance, disclose imprisonment for Assault whereas the assault could be Assault Occasioning Actual Bodily Harm or Assault Causing Grievous Bodily Harm or may, in fact, be assault of a sexual nature although the conviction is simply for Assault. 37 Peter Monie in his evidence (T326) was aware that the Commonwealth was paying a subsidy to an employer who employed people disadvantaged in the labour market: "Q. You were aware that the subsidy was paid in accordance with a Commonwealth program called JobStart? A. Yes.

[25]

And he said, "Yes, that's all right. That's good." 47 There is no substantial dispute as to the terms of the conversation which occurred between Darren Winsor and Peter Monie. It is not necessary to make a finding as to whether Sally Monie participated in that conversation or was present. The interview was brief. 48 The plaintiffs, in endeavouring to establish duty and breach, spent a considerable amount of time related to the conversations between Sam Monie and the witness Arca and the conversations which later occurred between Peter Monie, Sam Monie and the CES employee, Arca. 49 In examining the conversations which occurred between Sam Monie and Arca, even accepting that those conversations occurred, it is clear from that evidence that the function of the CES was to act as a referral agency. The plaintiffs were clearly on notice that all employees were substantially disadvantaged in the employment market but, nevertheless, took those employees because of the very substantial subsidies involved in their JobStart arrangements. 50 Notwithstanding that the plaintiffs were on notice of some problem with the potential employee, they made no attempt to explore the problem. At no stage was there any representation by the CES as to the potential employee, Winsor, being suitable. The process of examination of the CES records as to available applicants was obviously little more than a classification of categories of employment so that, logically, someone with no farm skills who was trained in clerical matters, or as a chef, or other such inappropriate skills would not be sent, but at all times it was the potential employer who was to do the interview and who was to decide the suitability of the referred potential employee. 51 There was no specific contractual relation made at any time in respect of Winsor, as indeed was not made for the previous employees, which raised a duty or responsibility on behalf of the CES. There was clearly no holding out as to the suitability of Darren Winsor. 52 To suggest that the CES had an employee to investigate the environment of a remote location, and if it did so, that this in some way would bear on the extraordinary circumstances of the shooting of Peter Monie by Darren Winsor, does not logically follow. There is no evidence that the location of the shooting had anything to do with the reasons for it. 53 The fact that Peter Monie said that he relied on the CES to check matters such as criminal history does not, of itself, give rise to any duty on the part of the CES. The CES, as referred to above, has limited capacity to explore a criminal record, and is unable, for the reasons I have outlined above, to make that record known. There is nothing in the arrangements made under the previous employment or indeed under this arrangement for employment that gave rise to any duty on the part of the CES to disclose the criminal antecedents. The whole JobStart scheme was predicated on assisting people who would, for various reasons, have problems obtaining employment. The very working of the subsidy scheme, therefore, put the potential employers on notice of a problem without specifying what that problem was. 54 For the reasons I have indicated in relation to Mr Sam Monie, I reject his evidence as to the terms of the conversation that he asserted occurred at the time of the employment of Darren Winsor. There is, in any event, in that conversation nothing which gives rise to a duty of care or any reliance on the part of the plaintiffs on the actions of the CES that was reflected in the events of the shooting of Peter Monie. 55 I find that the defendant had no duty of care in establishing the systems that it employed and that its actions in arranging for contact with the potential employers either directly or impliedly was a basis for any reliance on the part of the plaintiffs. In the event that any duty of care arose, as suggested by the plaintiffs, I can find no breach of any duty by the defendant. The fact that Darren Winsor committed the violent act that he did was not as a result of any propensity on his part, as evidenced, in any event, by his criminal record. What he did in shooting Peter Monie did not create a breach of any duty on the part of the defendant.

[28]

Q. "And I said to him"? A. I said to him, "Yes". I think he said something like, "What for?" or - you know, "What for?" and I said, "Assault" and Sam said to me that, "Oh, I have been too", or something like that. I took - can I correct that bit there. Not correct it. I took that as -"" 60 Taking into account Mr Sam Monie's unreliability as a witness and the fact that Peter Monie did not remember the conversation causes me to find that the conversation, as recorded in Peter Monie's statement, in fact, occurred. Peter Monie did not repeat or refer to a supposed conversation with his son, Sam Monie, about Winsor having said that a mate had blown a door off its hinges. 61 The plaintiffs say that they rely on Mason CJ in March (supra) at p518: "As a matter of both logic and common sense, it makes no sense to regard the negligence of the plaintiff or a third party as a superceding cause or novus actus interveniens when the defendant's wrongful conduct has generated the very risk of injury resulting from the negligence of the plaintiff or a third party and that injury occurs in the ordinary course of things. In such a situation, the defendant's negligence satisfies the "but for" test and is properly to be regarded as a cause of the consequence because there is no reason in common sense, logic or policy for refusing to so regard it." 62 I find that the conversation, as recorded by Peter Monie, with his son, did occur. They were both then on notice about the fact that their employee not only had committed a criminal offence but that it was such as to involve gaol and, therefore, to be a serious matter. They were both aware that Darren Winsor was severely disadvantaged in the employment market and were thus, with those two events, on notice of the events upon which the plaintiffs rely to establish their case. 63 In my view, this breach breaks the line of causation and the actions of the defendant, if arising out of a duty which has been breached, is defeated by a break in the chain of causation and as it was perfectly open to both Peter and Sam Monie to raise the issue and deal with it.

[34]

Economic Loss - Thornleigh & Co 77 As conceded by submissions for the plaintiffs it would not, in any event be possible to place a precise figure on the claim for economic loss. There were drought years during the 1990s and there were losses by the partnership up to the date of the attempted murder, some of those related to the drought, prior to the attempted murder. 78 The evidence of Mr Tremain indicates that the stud business could have been financially successful and it is submitted that it is more probable than not that the farm would have been profitable. 79 Considerable economic material was produced in the hearing taking into account earnings of the business prior to the shooting and subsequent to that event. 80 It is necessary to consider the circumstances of the making of the decision to substantially terminate the stud farm operation in the two dispersals which substantially depleted the stud herd. It is submitted by the plaintiffs that the court should find that the dispersal was a consequence of the severe wounding of Peter Monie. There were clearly disagreements between Mr Sam Monie and Mr Peter Monie over the direction of the farm. Some of the problems arose out of the family relationship, some arose from difference of philosophy between the two and some arose from the disagreements that clearly occurred between father and son. All of the evidence for the plaintiffs has endeavoured to minimise the extent of that, but it is clear that there were substantial disagreements. It is also evidenced by the fact that Sam Monie and Ben Monie bought some of the stud cattle in their own right at the sale and ran them with the remaining Thornleigh cattle. 81 It is difficult to equate the running of a farm with capital growth and other benefits of living on a farming property and living, to some extent, off that property. It seems to me inappropriate on the evidence before me to assume any basis whereby average weekly earnings would be an appropriate basis for calculation. 82 It is submitted by the defendant that the probability of the scaled up stud business operating profitably must be measured against the absence of any historical evidence as to profitability, evidence of the likely success of the operation of the stud by reference to other similar farms and the variable factors of drought and market prices. 83 The evidence of witnesses as to damages is based on assumptions which are not borne out by the evidence. 84 The defendant submits the evidence does not amount to anything more than a claim on theoretical losses sustained by the error of Peter Monie's judgment. 85 The plaintiffs accept that losses by the partnership preceded the shooting partly because of drought conditions. I accept the assumption made by the plaintiffs, that Peter Monie would have continued in the business until his seventieth birthday but would assume that his contribution would have substantially reduced as he neared that age. 86 I find that the decision to disperse the stud has not been established as resulting from the events of the shooting and that any losses made on Thornleigh, do not support a claim for economic loss.

[40]

Economic Loss - Sam Monie 102 The claim on behalf of Sam Monie is not for specific economic loss but his loss of a chance in terms of Daniels v Anderson (1995) 37 NSWLR 438, in particular the majority judgment at p530-531: "…the issue of causation should be approached upon the basis of proof upon the balance of probabilities with the qualification that an assessment of whether the chance which is said to have been lost had a value is to be made upon the possibilities or probabilities. For this reason it is appropriate to consider initially the question whether a chance was lost as a consequence of the breaches of duty and in the event that an affirmative answer is given to that question to defer consideration of the value issue which should be dealt with in determining whether, and if so what damages are payable …" 103 On behalf of the plaintiff, Sam Monie, it is conceded that no precise figure can be calculated and that the reality of the chance has to be extremely difficult by reason of a series of factors. These include Sam Monie's young age and a working life of some forty years of management of Thornleigh & Co and that his current employment over the next few years has exceeded the remuneration he had received at the time that he left Thornleigh. 104 The suggested basis is that he has lost the chance of earning in five years time and for thirty five years thereafter, at an average of $300.00 per week. 105 On the evidence of Sam's business ventures since leaving Thornleigh where he was making a loss, it is submitted by the defendant that Sam Monie would have received no wages and no assumptions can be made as to the value of his shares. 106 I agree with the submission of the defendant that there is no basis for showing a loss of $300.00 per week over any period and, in fact, it may well be that Sam Monie is better off, in financial terms, by not working at Thornleigh. 107 Rural properties in terms of value in periods of drought are extremely difficult to calculate. There are many factors involved in the complex of commercial, economic and emotional matters within the plaintiff's family. None of these evaluations are made any easier by the intervening stroke of Peter Monie and the consequential effect that must have had and the benefits to which Ben Monie would become entitled because of his own work on the property. 108 The matter is further complicated by the issues of credibility in the evidence of Sam Monie as his evidence was, when against him, reluctantly given and, when any opportunity arose, was self-serving and not believable. 109 I would not award Sam Monie any amount for economic loss as I find no loss has been established.