Naidu v Group 4 Securitas Pty Ltd & Anor

Preliminary note about fairness 12 It is obvious that Mr Chaloner's conduct lies at the centre of this case. For obvious reasons, he was not called by News or, for that matter, by Group 4. The result is that he has not had the opportunity to deny or refute the very serious allegations made about him. At the end of the day, however, this is a trial between the parties and not a commission of inquiry. I must deal with the evidence as it is called in this Court. That evidence has permitted but one conclusion about Mr Chaloner's conduct. But it is upon that evidence that the conclusion rests. What the conclusion might have been had Mr Chaloner been a party or called as a witness is not only speculative but irrelevant. When the substance of the allegations were put to him before his dismissal, he denied all misconduct. I have not given these denials any weight, except that they are part of the narrative of events covering what News did when it discovered what had been happening.

It would be very unfair to regard this judgment as being anything more than a determination as between these parties about Mr Chaloner, his character and his conduct. Any comment about this case that did not mention this qualification would not be fair.

Prefatory comments 13 As the plaintiff's evidence unfolded, I found it difficult to accept the truthfulness of his account, so extraordinary did his descriptions of Mr Chaloner's conduct seem and so passive was the plaintiff's response. However, I have been persuaded that the substance of the plaintiff's evidence in this regard is not only truthful (in the sense that he believes it to be true) but also by and large reliable. At the same time, I think that it contains some exaggeration and repetition. This is an overall impression and does not fasten on any particular incident; it is a common sense evaluation of the plaintiff's evidence as a whole. In order to convey the sense of the plaintiff's evidence and the way in which it was given, I have set out far more of it that one ordinarily would: initial attempts to summarise simply failed to do it justice. 14 Much more difficult to accept has been the plaintiff's emphatic and unqualified evidence about making frequent complaints to Mr Blinkworth about Mr Chaloner's misconduct. I have concluded that the plaintiff did not do so, at least in terms. Ordinarily, such a conclusion would have significantly adverse consequences for a witness's credibility impinging on other aspects of his or her evidence. However, I think that the plaintiff did indeed make some complaints (by no means as frequently as he thinks) of a general kind about Mr Chaloner's unreasonable demands and has come now to believe that he complained also about his actual misconduct - two aspects of their relationship which the plaintiff now finds it virtually impossible to distinguish. 15 I should concede, in fairness, that I have not been able to explain in a way that I find completely satisfactory the reasons for the plaintiff's failure to complain specifically about the latter conduct: I am sure they involved fear of reprisal, shame and embarrassment and a sense of subordination and overwhelming powerlessness. To some degree, these explanations must be speculative, since the plaintiff's insistence that he did complain to Mr Blinkworth naturally prevented questioning that sought to elicit any reasons for not doing so. Yet, bullying behaviour involving grossly improper conduct, including racist and sexist vilification, is notoriously under-reported even in the workplace and the undoubted fact that many victims seem unable or unwilling to take action at least for a considerable period of time shows that such responses are well within the range of ordinary human conduct and we should not be altogether surprised when it occurs. It is a regrettable commonplace of human experience that so often bullies seem to be able successfully to identify their marks. 16 It is perhaps difficult for a judge chosen from a Bar known, if not notorious, for its robust attitude to adversarial confrontation to understand how a person might be reduced to the plaintiff's profound sense of powerlessness - how and why he remained a victim for so long - and, as I say, I have no satisfactory answer to this question. At the same time, I do not have any real doubt that this is precisely what happened to the plaintiff or that this pitiable condition was both induced, and calculatedly induced, by the misconduct of Mr Chaloner towards him and, what is more, that it resulted in the substantial psychological injury to which I refer later in this judgment. 17 Moreover, I have concluded that so extreme was Mr Chaloner's behaviour that he well knew, or would have known had he reflected as any reasonable man should have, that prolonged misconduct of the kind he exhibited towards the plaintiff could reasonably be expected to expose him to the real risk of such psychological injury. This is not a matter solely or even mainly within the purview of medical science: it is a matter of common sense and human experience, naturally informed by what the doctors can tell us about it. I do not accept that the plaintiff was a person of significantly more than ordinary sensitivity or his character so outside the range of ordinary fortitude that the serious risk of substantial psychological injury would or should have been discounted, let alone dismissed, as insignificant. To the contrary, I think that the risk of such injury would have been obvious to any objective and reasonable observer. 18 I saw the plaintiff give evidence over a number of days. On many occasions, most not mentioned in the transcript, he became obviously distressed by being asked to recall different aspects of Mr Chaloner's conduct. I thought that that these emotional responses were genuine and spontaneous. Many of his answers gave me the impression of unconscious reconstruction or even confabulation. At times, he appeared to "switch off", occasionally in mid-answer. Despite my initial scepticism, I came to accept that that he did indeed suffer from the "flashbacks" which, when asked to explain what he was feeling, he said he was experiencing.

General 19 The alleged misconduct, so far it involved the plaintiff, occurred both inside and outside the work environment. In both contexts it was inappropriate and improper. In short, Mr Chaloner created a structure of oppression that was built on the power that his position with the defendants gave him over the nature and course of the plaintiff's employment. It is practically impossible to separate the impact which the "internal" and the "external" conduct had on the plaintiff's illness and I have not thought it necessary to do so. However, the defendants are not responsible in law for all that behaviour, in particular, that which occurred outside the workplace and the sexual incidents, to which I will come in due course. 20 The question whether wilful acts intended to cause injury are actionable torts is a difficult one. Some of the conduct occurring in the workplace alleged against Mr Chaloner might well amount to assaults at common law. Most of his conduct is of a very different character. Almost all comprises words, albeit offensive and demeaning. No single incident was itself productive of injury, nor could it have been reasonable to suppose that it might be. In the result, I have concluded that the conduct as a whole did indeed result in injury of a psychological kind, giving rise to perceptible psychiatric illness and that a substantial cause of this injury was the "internal" - that is to say, workplace related - misconduct, of Mr Chaloner, excluding the sexual incidents. It seems to me that an attempt to fit this pattern of conduct and concomitant injury into the "wilful-acts-productive-of-injury" model of potential liability would be an essentially arbitrary, if not capricious, Procrustean undertaking. If indeed the plaintiff suffered the psychological equivalent of the death of a thousand cuts, demonstrating that each of the cuts was trivial in its direct effect scarcely deals with the true issues in the case: to my mind it would avoid them.

The abuse starts 21 About two weeks before Easter 1992, Mr Chaloner asked the plaintiff what he intended to do over the Easter holiday break and was told that he intended to go up to the Central Coast with his family to look at houses and start building a house on some vacant land that he owned there. Mr Chaloner told the plaintiff that his father was a builder and his brother-in-law was a bricklayer and that he could arrange to build a house for him very cheaply. He said that the plaintiff should give Mr Chaloner sufficient funds to enable him to pay for this work. The plaintiff said that he would discuss the matter with his wife and let him know. He and his wife agreed not to accept Mr Chaloner's offer. The plaintiff said that when he told Mr Chaloner about this decision "he didn't sound very happy…[and said], (in an aggressive way) 'I'm giving you till the end of Friday and I want an answer and I want 'yes' as an answer'". On the Friday night, Mr Chaloner called the plaintiff and asked about the matter and was told, "We are not going to build it and I don't want you to build it so the answer is 'no'". The plaintiff said Mr Chaloner started to shout at him - "A. He call me a black cunt. He called me a prick. He called me a piker and I said, 'Why are you saying all this to me?', and he said, 'Why are you saying no to me?', and I said, 'We don't want to build it', and he said, 'Well, my wife is standing next to me and she can't believe that you are saying no. She has always told me not to trust you and she can't understand why have I got you working under me'. Then he turned around and said, 'I don't know why you have to listen to your wife, that miserable cow'."

The plaintiff said that the conversation continued - "'Well, if you don't want me to work for you, let me know and transfer me from the site'. He got really abusive on the phone and calling me-- Q. When you say 'he got abusive', just exactly what words did he use? A. The main words he used was, 'You monkey face. You black cunt. Why did you say no to me?' He said he will fix me up on Monday. He doesn't want to see me in his office. He doesn't want me anywhere near him and he will talk to Securitas Security and get me transferred from there.

Q. Did he say anything to you about what would happen if you did become transferred or stop working for him? A. Yes. He said if I ever get transferred - if I ever leave his work he will make sure that I don't get work anywhere in New South Wales in the security industry as he has got a lot of contacts, and he will do me.

Q. How did you feel about that statement from him? A. I was very upset, very shocked and I was crying and I didn't know what else to do." 22 The plaintiff said that the following occurred when he went back to work on the ensuing Monday - "A. On Monday morning he called me into his office and the first thing he did was he grabbed hold of my shirt and pushed me towards the end of the wall and he said, 'Why did you say no to me? I will do you'. I said to him, 'What have I done wrong?' He said, 'I will get you transferred from here.' I said, 'I also need to know why am I getting transferred for what I have done wrong?' He told me - as a matter of fact there was a chair where he was standing and he kicked the chair and the chair came and fell - hit my foot. I was crying but he would not care at all and he told me to fuck off from the room and I went downstairs to my office…"

The plaintiff said that he immediately put in a call to Group 4 and spoke to Mr Blinkworth - "I told Mr Blinkworth that Mr Chaloner said that he had spoken to Mr Deegan [Mr Chaloner's superior and a director of Group 4] and he was getting me transferred from here [meaning the News' premises] and, 'could you please tell me what was happening?'"

Mr Chaloner told the plaintiff that he knew nothing about this but would talk to Mr Deegan and let him know. It seems to me that it is significant that the plaintiff did not claim to have told Mr Blinkworth either about the terms used towards him by MrChaloner or what had instigated his query. 23 The plaintiff said that he did not think that Mr Chaloner was entitled to demand that the plaintiff should pay him to build his house. His explanation for not making a complaint was - "Because it was in the same - at the same time, like, but it wasn't in this conversation, like, when I gave him a call in regards to my transfer." 24 Shortly after, Mr Deegan called the plaintiff and told him to stay at News because Mr Chaloner had not spoken to him and he knew nothing about any suggested transfer. Shortly afterwards, Mr Chaloner required the plaintiff to attend his office - "Q. What did he say to you? A. He said to me, 'You black cunt. Who told you to give a call to Mr Deegan? I've told you before you are not allowed to contact anyone except for me so who gave you the right to give a call to him?', and told me to fuck off from there. I told him the only reason I called was I wanted to know where I was getting transferred from this site."

The plaintiff said that shortly after this conversation he went downstairs to his office. He was crying and upset and called Mr Blinkworth about Mr Chaloner's demand concerning building the house. Mr Blinkworth told the plaintiff that he would "talk to Mr Deegan and sort it out for us". Shortly afterwards, Mr Chaloner again summonsed the plaintiff to his office - "I was told that I am not allowed to make any telephone call outside the building without his authority because he told me that I am not allowed to talk to anyone, which I did again, and he told me that there won't be any transfer and just go and do your job".

After this, Mr Deegan telephoned the plaintiff and told him "that the client requires my service so hang in there". The plaintiff said that when Mr Chaloner told him "I will do you", he cried and was very scared. He said he did not know what to do. He said - "Q. Well, what did you understood was meant by that term 'I will do you' in terms of you? A. Well, normally what he does is, like, a few times when he said that downstairs where his office used to be there was no cement wall, it was just a board and he'll just come close and say, 'I'll do you' and he'll punch a hole on the wall and tell you that 'This is what I'm going to do to you'.

Q. Is that something that had happened before or after he used this term to you over your conversation of the transfer, 'I'll do you'? A. This was after the transfer thing." 25 The plaintiff said that he only told Mr Blinkworth and not Mr Deegan - "Because Mr Blinkworth was the main liaison officer for our site. First of all, I was very scared to even tell Mr Blinkworth because I didn't know what was going to happen to me, he was the one who told me I wasn't allowed to talk to anyone other than Mr Chaloner only." 26 It is baffling why the plaintiff thought that that meant that he could not or might not be able to talk even to Mr Blinkworth about what had happened, let alone Mr Blinkworth's superior. His evidence is that, nevertheless, he continuously complained to Mr Blinkworth about Mr Chaloner's conduct. Although the plaintiff understood that, when he complained to Mr Blinkworth, he was disobeying his instruction not to contact him, he said that Mr Blinkworth did not tell him that he was being disobedient in this respect. He did not seem to appreciate the illogic of this position. 27 The plaintiff thought that he would indeed be transferred (though in fact that did not occur). He said that, following this incident - "A. The major problems which happened was he always seemed very, very angry with me and he'll call me into his office as soon as he comes in and he'll address me down in calling me a coconut head. If he sees me in the foyer he'll say, 'What are you doing over there, you black man, you coconut head?', and he'll show his tantrum by throwing his file on the floor and asking me to pick it up for him and put it on his desk. That's how - basically I started my day, every day.

Q. You said he would refer to you as a 'coconut head', were there any other such terms as-- A. Yes.

HIS HONOUR: 'You black man' is also a term of abuse in this context.

KENNEDY: Q. Yes, any other terms of abuse? A. The main terms which were used all the time was coconut head, monkey face, a poofter, piker, a black man, and a black cunt.

Q. And would they be terms he would use of you on a regular basis? A. Yes, sir.

Q. Would they be on a daily basis or weekly basis or? A. It was on a daily basis.

Q. How many times during the course of the given day would you be with Mr Chaloner when you were carrying out your duties? A. I'd say at least - when I became his assistant close to 80 per cent." 28 The plaintiff said that the abuse to which he was subjected made him feel "very little and very, very scared of him…because every time he would threaten me that he will do me and he will kick the chairs, he will throw things and telling me that if I ever leave there I will never have a job, I will never be able to walk". The plaintiff said that Mr Chaloner, who was a big man, said these things in a very aggressive and physically threatening way. He said that the threats about work would be made almost every day and the threats that he would be unable to walk would be made at least once a week. The plaintiff said that, when he was spoken to in this way, "I used to cry and say to him, why is he saying all that to me. His normal words were, "If you want a job you just do your job and fuck off from the office". 29 The plaintiff said that Mr Chaloner abused him both in his office and, downstairs in the building, in the plaintiff's office and in the control room, and that this occurred in the presence of a number of the other Group 4 security officers, namely supervisors Terry O'Dwyer and Fred Jones, senior officer Stuart Windham, and security officer David Panat, also Mr Hassan O'Demis and Mr Francis Ghazawi, those persons being present at different times when the abuse occurred. 30 The plaintiff said that he reported Mr Chaloner's abuse to Mr Blinkworth on the telephone on a number of occasions. He said that the first occasion that he did this was when Mr Chaloner demanded that the plaintiff get him to build his house on the Central Coast. He said that he told Mr Blinkworth about the abusive names - "black man, a poofter and a black cunt" - which Mr Chaloner used towards him. He said that Mr Blinkworth told him that he would talk to Mr Deegan and "would sort it out for me". However, Mr Chaloner's conduct continued. The plaintiff said that he told Mr Blinkworth about Mr Chaloner's continuous abuse of him, if not every week, every second week or whenever he spoke to him. At this time, Mr Blinkworth was also talking to the plaintiff about Mr Chaloner's attitude towards him and the Group 4 contract. The plaintiff understood that this contract, relating to the premises of News at Surry Hills and Chullora, was worth close to $1 million a year to Group 4. Mr Blinkworth told the plaintiff that he was continuously reminded by Mr Chaloner that he should comply with all the latter's requests "because the contract is on a seven day basis and if he does not do what he wants to do then they will lose the contract". He said that Mr Blinkworth at no stage said anything to him about whether he should report Mr Chaloner's misbehaviour to anyone else. 31 The plaintiff said that when Mr Chaloner wanted him "to do something for him, he will be very, very nice" but that his mood was very changeable and quickly reverted to his abusive behaviour. The plaintiff said that Mr Chaloner also insulted his wife and that this also upset him very much. The plaintiff, however, responded to these insults by saying to Mr Chaloner that if he dared to talk about his wife in that way he would report him. He said that Mr Chaloner "would tell me to fuck off". He said that these insults about his wife occurred on a number of occasions. He said that he told Mr Blinkworth about it but that the conduct continued nevertheless. 32 The plaintiff also complained about the hours of work that Mr Chaloner made him undertake. Although his normal hours were supposed to be from 7 am to 4 pm, he used to finish between 10 pm and 11 pm and this meant, when he moved to live on the Central Coast and was commuting to and from Sydney, he would need to catch his train at 4.30 am and would not leave Sydney to return home until about 11.30 pm, arriving back home at some time after 1 am. Moreover, Mr Chaloner required him to work a twelve-hour shift on Sundays as well. The plaintiff said that he recorded the additional work hours he was required to undertake in the Group 4 "sign-on book" but was never paid. He said that he complained about working long hours for which he was not paid to Mr Blinkworth, who responded that he would talk to Mr Chaloner and get back to him but that, when he did so, he said "Well, Lance is the customer and he wants you to do those hours and he is a very difficult customer. For the sake of the contract, please hang on there and I will see what I can do". However, no payment was ever made. He said that a motor vehicle was eventually made available to him by Group 4 in 1995. He said that until he was given the car he would only have about three hours at home after work before it was necessary for him to go to work again and that this happened every night, Monday to Friday. He said that he found it very difficult, that he would "mostly cry, even on the train going home". He said that he "never saw my kids growing up and we used to have arguments at home [about it]". The plaintiff said that from the first day that he was asked to do these "extraordinary hours" he complained to Mr Chaloner because he (Mr Chaloner) was coming in at 10 am and leaving at 6 pm and yet he would call him at 10 pm to see whether he was still in the office. 33 The plaintiff said that despite his numerous complaints to Mr Blinkworth, his hours were never reduced. The plaintiff said - "I was always very, very tired, extremely tired but because of the threats I was getting that if I leave there I won't get a job anywhere, he'll make sure that I don't get a job. He will do me, that was his normal term to me and he'll make sure that I won't work and he'll hit the wall. He'll hold my shirt, kick the chair, throw the books at me, it always make me scared. I just couldn't do anything else…I was very fearful." 34 Mr Chaloner's humiliation of the plaintiff extended also to his use of the toilet - "Every time I have to go to the toilet I have to give him a call and get his permission to go to the toilet and when I used to give him a call regardless of where he was then he'll get angry with me saying, 'Why you calling me to go to the toilet?' When I remind him that that was his direction then he'll laugh and put the phone down. For example, if he does call the office and if I'm not in the office, if I happen to be in the toilet, then he'll get really angry and he will abuse me and if I'm at work and he's at work, he comes to the office and if I'm not there and if the secretary says that, 'He's gone to the toilet', he'll come to the toilet, inside the toilet and yell out my name until I say, 'Yes, I'm here'".

The plaintiff said that he was very embarrassed, angry and tearful about this behaviour and complained to Mr Chaloner about it many times and also complained to Mr Blinkworth. 35 At one stage the plaintiff said that his wife telephoned Mr Chaloner to complain about his hours of work and that Mr Chaloner said to him -

"Tell that wife of yours I don't like her. She's not supposed to give a call here. She's a miserable cow, a fat bitch, and tell her that I pay your wages not Group 4 or News Limited and you work for me". 36 In 1992 Mrs Naidu was admitted to St George Hospital with complications possibly involving her then pregnancy in respect of her second child. Not surprisingly, the plaintiff wished to pick her up from hospital following her admission but Mr Chaloner refused to give him the time to do so. The plaintiff asked Mr Blinkworth for permission and was given it. However, by the time the plaintiff reached the hospital, his wife had already gone home by taxi. The plaintiff went home and called Mr Blinkworth who told him, "Mr Chaloner is very ropeable. He is very, very angry and please do not take any more time off because he wants you at work". 37 The plaintiff complained of other bizarre behaviour on Mr Chaloner's part - "Q. Were there occasions when Mr Chaloner would ask you to find files or documents or things? A. Yes.

Q. What was the position as far as when you carried out your search? A. He would - he'll have either contractors or someone he knows, an outsider, someone not from News Limited, he'll have them sitting there. He will hide the file either underneath his desk or he'll put it somewhere and he'll ask me to find that file. Obviously I won't be able to find it and what he will do is he will then call me 'a black man', 'a poofter', 'you don't know what you're doing'. He'll throw the other files and tell me to pick it up in front of others and then laugh at me and then say to them, 'This is how you control your staff'.

Q. Is that something that happened on an isolated occasion or did it happen on some regular basis? A. It happened a lot of times.

Q. How did you react to that occurring? A. I was always in tears and crying and going back into my office and crying and even those people who were present when it happened, even they came and spoke to me afterwards when Lance wasn't present that they can't believe that he's doing that to me." 38 In September 1993 Mr Chaloner and a Mr Wentworth spoke to the plaintiff about entering into a new salary package. The hours of work specified were from 7 am to 4 pm but the plaintiff declined to sign it because the salary was less than that which he was currently receiving and other security officers were getting paid more than the offer. He said that Mr Chaloner abused him for refusing to sign the new contract. 39 The plaintiff said that Mr Chaloner was involved in a security company known as Euro Alliance in late 1990 and that, in 1991, Mr Chaloner got him to do some work also for Euro Alliance on perhaps five or six occasions. He complained to Mr Chaloner that this was inconsistent with Group 4's arrangement with News and that he (the plaintiff) was not permitted to work for another company. He said that Mr Chaloner threatened him in words to the effect "If you don't do it you haven't got a job". The plaintiff understood that in 1992 News became aware of Mr Chaloner's involvement with Euro Alliance and he did not further work for that firm after that time. 40 In the latter part of 1992 or early 1993 another strange incident occurred involving Mr Chaloner - "Q. Was there an occasion in the latter part of 1992 or early 1993 when you had dropped Mr Chaloner at a meeting at Five Dock? A. Yes, sir.

Q. Did that involve you attending a fire system training? A. Yes.

Q. At Chullora as well? A. Yes. What happened was I was supposed to go for fire training at Chullora and I had to drop Mr Chaloner at one of the subcontractors' office for a meeting. On my way back from Chullora prints site I was five minutes late to pick him up and he got very, very angry with me, called me a black man, a poofter, a black cunt, no good for nothing, and then he came and sat in the car and he started hitting the dashboard of the car, and we were driving along Parramatta Road and there was many other cars and people were watching when he was just punching the car, kicking the dash board of the car and just yelling and abusing me.

Q. What did you do, did you try and get away from there or do something? A. I could do nothing in the car but as soon as we reached Surry Hills I said to him that I want to go home.

Q. What did he say in response to that request? A. He said no. He said, 'Why can't you take that you are black man. Can't you take a joke?' And I said, 'That wasn't a joke of what you just did to me'. Then he said, 'No, you can't go home', and I had to stay at work." 41 The plaintiff said that there was a strike at the Cumberland newspaper offices at Parramatta in the latter part of 1993. There was need for increased security and the plaintiff, together with other officers, was required to live at the premises for a week or so. Mr Chaloner was there every second day and night. The plaintiff's account of his abusive behaviour reached its most extreme in the following evidence - Q. Did he give you any directions about you having to wake him up in the morning? A. Yes? Q. What was that? A. He wanted me to wake him up every morning at 5 o'clock and make him a cup of coffee and then he will go and have his shower in the shower area. I am to guard the area of the shower, which had no doors. The first morning when I did that he came into the shower area, took all his clothes off, and started fondling with himself.

Q. What did you do when you observed this to occur? A. I looked away from it, and then he was singing a song, I can't remember which one it was, but then he came close to me and he grabbed my private part and squeezed it. Q. What did you do? A. I pushed him away and he said, "Why, don't you like it, you black men?" I started crying. Then he came back and with his right hand he just slide it through my private part, and then walked away to have a shower. Q. Were you clothed when this occurred? A. Yes. Q. Had anything like that ever happened to you before? A. No, sir. Q. What did you do then after this occurred, did you remain there or did you leave? A. No, I ran outside crying and I went towards the dock area and there was two other security officers there by the name of Stuart Windham and Andrew Jackson. I could not say anything to them, but I was crying and all I can remember them saying is, "That bastard has done it again and he will get his turn". Q. Did that type of thing occur on more than one occasion during the time that you were out there living at the Cumberland Newspaper site? A. While I was there on that week, apart from the last day when he wasn't there. HIS HONOUR: Q. I am sorry, I don't quite understand, are you saying it happened every day except for the last one? A. Yes, I was there for a week and he was not there on the last day of the strike. … SHORT ADJOURNMENT KENNEDY: Q. You mentioned when you went outside and saw Mr Windham and Mr Jackson, is that right? A. Yes, sir. Q. Did you mention anything to them about what had transpired in the shower area? A. No, sir. Q. Why was that? A. I was too embarrassed. Q. You mentioned in your evidence that you were out at Cumberland for seven days and Mr Chaloner was there for six days? A. Yes, sir. Q. Is that correct? A. Yes, sir. Q. You gave some evidence about five to ten minutes ago in relation to what happened out there on the first morning, I take it, is that correct? A. Yes. Q. In relation to the second day, did anything untoward occur in relation to anything of sexual impropriety? A. Yes, he will come into the shower area and demand that I stand near the doorway and guard it so that no-one else can come in. He will do exactly like every - like the first day; he will take his clothes off and he will fondle or play with his private parts, and he will not come and squeeze my private part, but he will come and touch it and walk away laughing at me.

Q. That was the second morning, was it? A. That's how it was for the rest of the time.

HIS HONOUR: Q. Sorry, Mr Naidu, to ask this question which will perhaps embarrass you, but when you say he would play with his genitals, can you be more precise about what he actually did? A. He will fondle with his private part in a - I don't know how to explain it, but as if--

Q. How long did it go on for? A. At least two to three minutes. It is like masturbating himself, that's how he will be doing it.

Q. Did he ejaculate? A. I don't know, sir.

Q. Did you turn your back on him? A. Yes, sir.

Q. How did it come about therefore that you saw him masturbating or playing with himself? A. He will come and stand in front of you regardless of you are turning your back, and say, 'Why, don't you like it, you black man'.

KENNEDY: Q. You mentioned two mornings when Mr Chaloner was taking a shower; what was the position, if any, as regards any of the other days? A. The other days was similar to this, apart from like I said the first morning, where he squeezed my genitals, he didn't do that.

Q. Was that only done on the one occasion, that was on the first morning? A. The squeezing of my genitals, yes.

HIS HONOUR: Q. As I understood you, any touching in that part of your body only occurred on the one occasion? A. No, sir, the genital, he squeezed it only on the first morning and the first morning he touched it.

Q. He rubbed his hands? A. Yes, and that's what he used to do all the other time, and play with himself in front of me.

KENNEDY: Q. How did you feel about these things that you observed in relation to Mr Chaloner in this shower area at Cumberland Press? A. I felt very sick, I felt like a numbness in me and I just didn't know what to do. I was just crying my head off because I just didn't know what to do because I didn't know who to turn to, who to talk to about it.

Q. Did Mr Chaloner have any discussion or conversation with you about what you should or should not do in relation to what you had observed at Cumberland Newspaper? A. Yes, he said to me on numerous occasions that if I do happen to mention that to anyone he will kill me.

Q. Did you mention these occurrences to Mr Blinkworth? A. No, sir.

Q. Why was that? A. First of all I was very embarrassed and ashamed and at the same time, because of all the other things which Mr Chaloner did to me, I was complaining all the time and nothing ever happened. So whether I was right or wrong, but I thought if I go and tell this it's going to fall on me as if I am lying, or nothing ever will happen and how am I going to face everyone.

Q. What were your thoughts, if any, about him saying to you that if you told anyone he would kill you? A. I was scared that he will definitely, I mean I don't know if he could have killed me or not, but definitely he meant it.

Q. What was, to your knowledge, Mr Chaloner's background in terms of occupation prior to obtaining his position with News Limited? A. All I know is that according to him he came to Australia playing soccer and he was a black belt in martial arts and a boxer." 42 At the time of these incidents, the plaintiff said that he mentioned to a Group 4 security officer, a Mr Silan, Mr Chaloner's sexual harassment - "I was on that night, I was crying because I could not stop crying, and he saw me and he said, 'What is wrong?' Because he was not security officer, like he wasn't a regular security officer for us, he never work with us, apart from that strike, I did tell him that Mr Chaloner sexually harassed me. And he got very angry and he said, 'Why don't we go and bash him up?', I think he said, and I told him not to. I said, 'Because you will not only lose your job but I will lose my job and he is a very dangerous man'." 43 During the strike, security officers at Cumberland Press were paid in cash and it was necessary to accompany Mr Chaloner and the financial controller of Cumberland Press, Mr Graham Cutler, to the bank to get the cash. The plaintiff was involved in providing information about the hours worked and he (the plaintiff) was responsible for counting the money and paying the workers. This was done daily. As I understand it, these cash payments were in addition to the ordinary wages received from Group 4. When the plaintiff raised this question Mr Chaloner, he said, called him racist names and threw his money on to the floor of the van for him to pick up. 44 Another specific occasion that the plaintiff recalled when he was the subject of racist abuse from Mr Chaloner was when he allowed a Group 4 security officer to use Mr Chaloner's vehicle in the course of his duties whilst he (Mr Chaloner) was in Perth and did not need it at all events. This abuse was extended, occurring not only during a telephone call when Mr. Naidu told Mr Chaloner what he had done but also when Mr Chaloner returned to Sydney. The abusive terms included, "a black man, a poofter, a black cunt, monkey face, coconut head, a piker". The plaintiff said that he informed Mr Blinkworth of Mr Chaloner's abuse and the reason for it but Mr Blinkworth said no more than that he would talk to Mr Chaloner. 45 On another occasion, the plaintiff said the following occurred - "Mr - he was - Mr Chaloner was interstate and he, like, he went there for three days but he happened to come back. The next day he gave me a call to pick him up from the airport. When I went to pick him up he looked very, very angry but didn't say anything to me in the angry way or whatever but he looked very, very angry and very upset, and while I was on my way I said to him - I mean, normally when he's angry I don't say anything because being scared he's going to blow me apart, okay, but as we were driving along I asked him how come he's back so early and that's when he said to me that he received a phone call from his wife and money had been stolen from his house, and I can only say of what he told me, the amount was $70,000 cash, and he said Steve Paine knows about it, he has already told him and he is not coming to work; as soon as we go to Hall Street he's going to go straight home, and if he hears I have told anyone about this he will do me.

"HIS HONOUR: Q. Well, did you tell anyone about it? A. No, sir.

Q. Why? A. Because I was scared that he might do something to me."

46 The first holiday which the plaintiff took whilst he was working under Mr Chaloner's direction occurred in 1995. He had not had a holiday for three years. He went to Fiji with his family. Mr Chaloner insisted that he should telephone every day to see whether there was any issue which needed to be discussed. This entailed the plaintiff driving fifteen kilometres from where he was living to an available telephone. During these conversations Mr Chaloner pressed the plaintiff to return, saying that he had mentioned the matter to Mr Stephen Paine (a superior officer at News) and Mr Blinkworth, who had approved his early return and would reimburse him for the loss of his holidays. The plaintiff refused to return, despite Mr Chaloner's threats that if he did not comply, he would lose his employment. When the plaintiff asked Mr Chaloner for reimbursement for the cost of the telephone calls and travel to and from the telephone, he was told to "fuck off". He said that he did not put in a claim to Group 4, to Mr Blinkworth, because Mr Chaloner was the one who had said that he would be reimbursed for these expenses. The plaintiff said that when he returned from his holiday, the situation was becoming worse - "A. He will - it came to a stage where it became like every day things; he will come to work and the first thing he will have to do is he will have to abuse me behind the closed doors, and then, once he sees me crying, then he will talk very, very nicely to me and say: 'Why can't you take it, you black man', and then ask me to go and make him a cup of coffee, and this was his usual way then and until he needs something then he will be the nicest person you could have ever seen or found, and once it's done then it's a sudden change, and every time you think it might change him, it might be better because, like, he's like this now, but then all of a sudden it's different. Work at Mr Chaloner's house 47 The plaintiff gave the following evidence - "Q. Do you recall there was an occasion in 1994 when he asked that you meet him at a residence at Kenthurst? A. That, that was in 1995.

Q. 1995 was it? Yes? A. When I came back from my holidays from Fiji, I had one week left because I took five weeks off because I wanted to spend one week at home. He called; he wanted me to go to work and I told him: 'Sorry, I'm not going to come to work because I have got a week and I have got so many things to do at home', and he said - he didn't say anything, he put the phone down.

Then he called back again saying that he has spoken to Mr Blinkworth and it is okay by him for me to come back and I said: 'Well, I'm sorry, I'm not going to come back and I will talk to Charles about it', and he then yelled at me on the phone calling me 'a black man, black cunt, no good for nothing', and he hung up on me; and then the third time he called again and he said he has just gone and seen Steve Paine and he wants me to come and just do this one thing and then go back, and I called Mr Blinkworth and I told him, I said: 'This is what Lance has said to me', and he said: 'Dave, he has not spoken to me and, please, he is a very difficult customer but, please, just go once and just do that for us.'

Q. So did you go along? A. Yes, I did.

Q. That was still in the holiday period? A. Yes.

Q. And that additional week you have referred to, did you have some additional plans in relation to that week? A. Just doing general work at home.

Q. So you went into Surry Hills? A. Yes.

Q. Did you see Mr Chaloner? A. I went to Surry Hills; I think it was, if I am not wrong, round about 6 o'clock or just after 6 o'clock in the morning. He was not there. Whatever he wanted me to do the files were in my office. I explained everything to his secretary and then I came downstairs to the network control area.

There was some problem with the alarms and I was fixing that and things; that's when he gave me a call and the time was somewhere close to 9.30 or 9 o'clock and he said to me he's on his way to work and I went to see him and I said to him: 'I'm sorry, I can't stay back, I have already done whatever you wanted me to do and I would like to go home', and he said, then he raised his voice and I heard other officers standing there while he raised his voice.

HIS HONOUR: Q. Other officers standing where? A. In that area where he gave me a call in the control room.

Q. You heard their voices? A. Yes, they could hear him.

Q. Sorry, they were in your company? A. Yes, sir.

KENNEDY: Q. Was this a personal discussion or a phone communication? A. Yes, personal.

HIS HONOUR: Q. But these other officers were in your company? A. Yes.

KENNEDY: Q. What was the outcome of this? A. He abused me but I still didn't stay there, I went home, and then on my way home he called me on the phone and abused me again and then said to me: 'There's something to do with the contract of, of Group 4', and he wanted to see me urgently and he said he cannot discuss it at work but it's something to do with the contract and Group 4 is, not Group 4, is looking at cutting the budget of the cost cutting and they are thinking of removing you from this site and he said: 'I need to see you urgently' and he said: "I need you on Friday', so at 7 o'clock in the morning at his home address, he gave me his home address --.

Q. Was that 8 Murray Park Road, Kenthurst? A. Yes, sir.

Q. He asked you to go to that address on that day? A. Yes, on a Friday.

Q. Why did you go? A. Because he said it was in regard to the contract he wanted to see me.

Q. You went out to his residence, is that right? A. Yes.

Q. Did he say something to you about what he wanted you to do? A. As soon as I went in there he was at the doorway, he had his son and a few of his friends and a few others. He asked me to come in and said to me: "I need you to come and help me here in doing the brickwork, the cement work, and doing the fencing in the seven acre block", and I said to him, I said: "I'm not going to do that." I said: "You asked me to come here to discuss about the contract", and he said: "Why I thought all you black men can all do that work. Why can't you, aren't you tough enough to do it", and --.

"Q. Had you ever done any of that sort of work he was asking you if you might do before? A. No.

HIS HONOUR: What does it matter? If it happened it was totally unjustified.

KENNEDY: Q. What was the position so far as his premises at 8 Murray Park Road, Kenthurst? A. He forced me to stay there and got me to go and help him in digging holes to put the poles, poles for the fencing of the seven acre block.

HIS HONOUR: Q. You say he forced you? A. Yes, sir.

Q. What do you mean by that? A. He came close to me and he said: 'If you don't help you haven't got a job', and he basically said that: 'And if you go and tell anyone I will make sure you are not around', and I was, I was in tears, and his kids and his other friends they were all laughing at me in there and I couldn't, I just couldn't start doing it. I was just completely helpless.

KENNEDY: Q. Did you do any of the digging of the holes that particular day? A. Yes, I did.

Q. Well, for how long did you do it for? A. I happened to be there till midday and then I went home.

Q. Did you stay at home there for the balance of the holiday period you had organised? A. That was the last day of my holiday, Friday.

Q. And the premises that you were out there for was that a completed house? A. No, it was getting built.

Q. Now, did he make a further request of you to go to those premises and carry out work? A. Yes, he did. I went.

Q. What was your response to that request? A. That no, I will not do it, and what he did was when I came to work on Monday he said, all he wants me is for that following Saturday; he said he has got a few people to come and see what he was doing. He said: I don't want you to help me, I don't want you to do anything, to just come along and see what is happening there, and I went and when I went there there was another staff member from News Limited, his name was Hitham Kamaladine, of News Limited, he was there, and there was another managing director of a company which was doing security contractual work, Mr Ian Phillips, he was there as well with Mr Chaloner and his kids, and that day he said to me, he said: 'I want you to cut this and use a brake [sic] saw' and, well, I never used it, and he said: 'Come on, you black man' in front of everyone: 'Why can't you do it, just go and cut it', and he went there, he spoke to me, he said: 'This is the way you cut it', and when I cut it, it was done wrong, and he picked it up and threw it down on my foot.

Q. Prior to going out and doing that work on that occasion, had Mr Chaloner spoken to you at all about having spoken to Mr Paine? A. That, after that Saturday on the following weeks, yes, he did.

Q. What had he said about that? A. He said to me that he has spoken to Mr Steve Paine in regard to me going an helping at his place doing the work and, according to Mr Chaloner, Stephen Paine said it's okay for me to go and help him provided it does not interfere with my work because he is doing the same thing with the builder, according to Lance he is also getting the help from the builders Stephen and O'Neill, who were contracted to Surry Hills, News Limited.

KENNEDY: Q. This occasion when the incident involved in the block occurred was on the Saturday? A. Yes.

Q. How long did you spend out there at those premises on that day? A. I was there till approximately four o'clock in the afternoon.

Q. What time had you gone there? A. Between 7 and 8.

Q. Did he also ask you to do some work with a cement mixer and wheelbarrow? A. Yes, he did.

Q. What did he ask you to do? A. That was mixing the cement, like, getting sand and putting the wheelbarrow and read the - I think he was telling me to mix some oxide in it.

HIS HONOUR: Q. Sorry? A. I had to mix some kind of an oxide to give some colour to some water.

KENNEDY: Q. Why was it you were prepared to go and do this work that seemed to be totally unrelated to your job, why did you do it? A. I never knew it was going to carry on like that because he said on the Saturday just to come in, just to have a look. There were a few people in there; he said: 'Just have a look at what we're doing.' For that reason I went there that Saturday.

Q. Did you go on subsequent Saturdays? A. Yes, because he told me Mr Paine has told him it's okay for me to go and help him.

Q. What was your wife's reaction to you going off, working these long hours and going off on Saturday to Mr Chaloner's property to do work? A. She was not happy at all. She gave a call to Mr Chaloner on the first Saturday and I had the other fellow in the car, I was taking him home. She gave him a call and asked why is he doing that to me and she's going to report it to Group 4 and according to her Lance said he will not do that and he will not have me there at his place helping me and --.

Q. And did Mr Chaloner say anything to you about what conversation, if any, he may have had with your wife? A. Yes, he gave me a call on the mobile phone, which was hands free. He said to me: 'You fucking black cunt, why can't you black men - something like that - rule your wife the same way as we white men do?'

Q. How did you feel about him referring to your wife in those terms? A. I said to him: 'You've got no right to talk about my wife like that and the only reason she has called is I'm not supposed to do this', and he said: 'Well, I don't like that miserable cow, that fat bitch, and you tell her not to call me again.'

Q. In relation to this matter of you going off to Mr Chaloner's property to do this work, did you ever raise that with Mr Blinkworth? A. Yes, after that Saturday when I went back to work on the Monday he said to me --.

HIS HONOUR: Q. Who? A. Mr Lance Chaloner, when he came to work he always comes around about 10 or 10.30. He went round and sees Steve Paine, that's the first thing he does. He came back and took me into his office and he said to me he has spoken to Steve Paine and Steve Paine has said it's okay for him to take me to his place to help him out, so he took me to his place because I was in my car, he was in his car, and I called Mr Blinkworth and I reported it to him.

Q. What did you say to Mr Blinkworth? A. I told him Lance is taking me to his place to do hard labour - that was the word I used to do hard labour - and he said, he has said to me that Steve Paine has authorised it.

Q. Did you say to Mr Blinkworth I don't want to or I shouldn't have to go or any words like that? A. He has forced me and he takes me there. He said he will talk to him and said --

KENNEDY: Q. The first time you appear to have gone to Group 4 was during a working week? A. Yes.

HIS HONOUR: The first time he went was on his holidays

Q. After that initial period where you went on Saturday, did you continue to go? A. Yes.

Q. Why did you go? A. Because I was employed with the job and I had no other choice because I have already notified Mr Blinkworth and nothing happened.

HIS HONOUR: Q. The day upon which you had this conversation with Mr Blinkworth that was a working day? A. Yes.

Q. He said to you I will talk to whom, Mr Chaloner, after --? A. He said he will talk to Mr Chaloner and he will get back to me.

KENNEDY: Q. Did he get back to you? A. Yes, he did, not on the same day.

Q. What did he say about --? A. He said to me: 'He's a very difficult customer. As you can understand, we have got a very big contract', and he said: 'Sorry, mate, just hang in there and I'll see what I can do for you.'

Q. So from that time on did you go to those premises on different days to do work? A. Yes, it was at least two or three times on weekdays and I think around about three times I think he took me there for a continuous, like, whole week.

Q. Did you go on Saturdays? A. Yes.

HIS HONOUR: Q. What happened to the sign on/sign off book when you went out to Kenthurst? A. I was on a salary at that time.

Q. So you didn't have to sign on and off? A. No.

KENNEDY: Q. You were going out to these premises sometimes during the working week, is that right? A. Yes.

Q. Was that as a result of Mr Chaloner telling you to do so? A. Yes.

HIS HONOUR: I don't think you should lead that, Mr Kennedy.

KENNEDY: Q. What was your feeling about these instructions you were given? A. He was angry and upset but just because he was mentioning his superior's name I could not go and ask his superior. If I said that --

Q. In relation to the weekdays when you were going out doing this work, how was it you were able to attend to your normal duties? A. From what he said to me he has called Group 4 and notified them I was, I am doing special project for News Limited and News Limited he has told them I am doing special project for Group 4. As far as the security officers were concerned, Mr Chaloner didn't know the security officers knew I was working at his place.

HIS HONOUR: Q. How did they know? A. I told them that's where he was taking me and "if you need anything you'll have to call me on my mobile".

KENNEDY: Q. Would you go there --? A. At his house?

Q. Yes. A. No, he would come and take me from work in different cars.

Q. Would you go together? A. In different cars.

Q. Would he do work as well as you? A. Yes, he would, and at the beginning he was giving me his clothes to work, to do the job.

Q. Well, did you receive any remuneration from him in relation to occasions when you went out there on the weekend? A. No, I didn't.

Q. Did you ask for some? A. All I said to him is that 'I am not allowed to do this', and he said to me: 'If you don't do it you haven't got a job', and that was it.

Q. Did you value the job you did? A. Yes, I did.

Q. Did you see there may be opportunity for advancement as far as your job was concerned? A. Yes, I have always wanted to progress further. I went to do courses because I wanted to progress further in the security industry but never had an opportunity.

Q. When you were out at Chaloner's property at Kenthurst doing some of this work you have referred to? A. Yes.

Q. And you were not at News Limited doing your security tasks? A. Yes.

Q. How did you get your normal work done during the course of the working week? A. The three weeks he had me ten --.

HIS HONOUR: Q. You mean five days a week? A. Five days a week, yes, at that time I had to go from his place to Surry Hills and pick up all the work that was left there and do whatever I can there and take the rest home and bring it back in the morning.

Q. Bring it back where in the morning? A. Surry Hills and the rest of the time because I was going from work so he made sure the work was done over there.

KENNEDY: Q. You told us in your evidence about working exceedingly long hours during the course of the working week? A: Yes." 48 The plaintiff said that when he was at Mr Chaloner's residence, as well as members of his (Mr Chaloner's) family and his friends, who were also working there, on one occasion Mr Haitham Kamaledine, News' architect, who drew the plans for the work and a Mr Ian Phillips, also a News' employee, were there. He said that Mr Chaloner abused him for not coming back to work on a Sunday, in the presence of Mr Kamaledine on one or two occasions. On the occasions when he was abused - "I would feel very little and it would make me very angry and I will have tears in my eyes and because he will say in front of his kids who are just not even eight years old and they would laugh about it, that made me angry". 49 During this period, that is between May 1995 and November 1996, Mr Chaloner required the plaintiff to work on his property frequently for three days a week during the ordinary working week and the usual working hours. Mr Chaloner told him that he had approval from his superior, Mr Stephen Paine, whom he told that the plaintiff was doing a special project for Group 4 and he told Group 4 that the plaintiff was doing a special project for News. Mr Chaloner also, the plaintiff said, told him that he said to security officers at the Surry Hills' premises only to contact the plaintiff when it was otherwise because he was undertaking a "special project". The plaintiff said that the officers knew, however, that the plaintiff was working at Mr Chaloner's house. The plaintiff said that, whilst he was working at the house he did not get any lunch breaks with the possible exception of two occasions and when the builders said to Mr Chaloner "Why don't you give him a break?" Mr Chaloner replied, "He's only a black man, don't worry about him". These things were also said in the presence of Mr Ian Phillips. The plaintiff said that being referred to in these terms, "would really hurt me and I will feel very, very small and I couldn't do anything". 50 Eventually, the plaintiff said that he was not getting paid for doing work on Mr Chaloner's property at Kenthurst and that he would not do it. He said that he had only done that work because Mr Chaloner had threatened him with physical violence, had abused him and said that he would lose his work. If he happened to be a few minutes late, Mr Chaloner would subject him to racial abuse and this occurred regularly throughout the period. The plaintiff said that working on Saturdays on Mr Chaloner's property occurred from May 1995 to November 1996 with only a couple of exceptions.

The plaintiff's mother is unwell 51 In July 1995 the plaintiff was informed that his mother in Fiji had a stroke and it was thought that it might well be fatal. The plaintiff said that he raised this matter with Mr Chaloner and told him that he needed to go to Fiji to see her. Mr Chaloner suggested that this was unnecessary, but the plaintiff insisted. Mr Blinkworth told the plaintiff that, although Mr Chaloner advised him not to let him go, he gave permission for him to undertake the trip. Mr Chaloner insisted that the plaintiff should be back in three days and, when through his wife, he enquired from Mr Chaloner if he could take a few extra days off, she was told (falsely) that if he needed his job he would need to come back because Mr Paine and Mr Blinkworth were unhappy about his being away and thought that he had invented his mother's ill-health and was taking a holiday. Accordingly, The plaintiff came back after three days. Whilst the plaintiff had been making arrangements for staff to take over some of his duties, he was abused further by Mr Chaloner. 52 On his return, Mr Blinkworth told him that he had not suggested to Mr Chaloner that the trip was unjustified in any way and Mr Paine simply asked how his mother was and expressed surprise at his early return. On the following day Mr Chaloner required the plaintiff to go out and resume work on his property. Although the plaintiff protested at first he agreed to go when Mr Chaloner told him that he had spoken to Mr Paine who had given his approval. On his way to Mr Chaloner's house he telephoned Mr Blinkworth and said, "Charles, is this why Lance called me back so early from Fiji, he is now taking me back to his place to do the hard labour". The plaintiff said that he said that Mr Blinkworth responded, "I can't believe how he can get away with all this" and said that he would talk to him. The plaintiff said that this was his usual response to his complaints. 53 On one occasion, Mr Chaloner wished the plaintiff to forge Mr Paine's signature on an invoice for some work which was being done at one of News' sites. The plaintiff refused. The plaintiff did not say that any particular insult or abuse followed this refusal. 54 It is clear that Group 4 had a very substantial security business not only in New South Wales, but in other states, in looking after News' sites and that a threat to the plaintiff to exclude him from that work would have been very worrying.

The plaintiff has an accident 55 In February 1996 the plaintiff was involved in a motorcar accident that required hospitalization and some time off to recover. He said that, on the morning after his release from hospital, a car was sent for him to return to work but he told Mr Chaloner that he was not feeling well and could not work yet. When he said this to Mr Blinkworth, Mr Blinkworth told him that Mr Chaloner "is very, very angry and he thinks you are doing all this to have more time off and please get well soon and come back to work". As a result of this he attempted to go back to work before he was well but was unable to do so because of pain. When he informed Mr Blinkworth of this he was simply told to try to get well as soon as possible because Mr Chaloner "is giving them a very hard time". As a result the plaintiff did return to work to perform urgent tasks, whilst he was unwell. 56 On an occasion after his return to work Mr Chaloner visited him at his home - "…He came to my place with the sub-contractor Mr Ian Phillips. He knocked at the door and my wife opened the door. He came inside and as my wife went to make a cup of coffee he said "I have got a present for you" and he went into the car and then he came back and gave me a packet of condoms.

Q. Did he say anything about why he was doing that? A. He said "You can use it while you are at home".

Q. How did you feel about that? A. I threw it and I said to him "Why you doing this" and Ian Phillips was there and he just shook his head.

HIS HONOUR: Q. Who shook his head, Mr Chaloner or Mr Phillips? A. Mr Phillips.

Q. Did Mr Chaloner respond? A. No sir, he just laughed." 57 Whilst he had been recuperating Mr Chaloner rang him continuously to abuse him about taking time off and suggesting that both Mr Paine and Mr Blinkworth thought that he was faking his illness. When the plaintiff returned to work it was necessary for him to have regular physiotherapy but Mr Chaloner prevented him from going to his appointments after the first three weeks, claiming that he had too much work to do. The plaintiff complained about this to Mr Blinkworth who said to him, "I can't believe he's doing that to you and how can he get away with it and please, Dave, hang in there, I will see what I can do" but nothing was done and he was unable to complete his course of physiotherapy.

Further pressure 58 In September 1996 Mr and Mrs Naidu opened a restaurant at Budgewoi on the Central Coast, which was run by Mrs Naidu. Mr Chaloner and Mr Blinkworth were informed of this fact. Mr Chaloner first said to him that the plaintiff was not allowed to have another business whilst working for Securitas at News but the plaintiff told him that he had obtained permission from Securitas to do so. Later on, Mr Chaloner pressed the plaintiff to permit him to take a 50% interest in the business, continuously wanting to know about the takings and coming over to the restaurant. A conversation along these lines was conducted in Mrs Naidu's presence at the restaurant on one occasion and Mrs Naidu emphatically rejected Mr Chaloner's proposal. On the following day, Mr Chaloner told the plaintiff that he should tell his wife that she was not to call him (the plaintiff) at work, adding gross insults about her.

Investigation 59 Towards the end of November 1996 Mr Chaloner's conduct was the subject of investigation by News as a result of complaints about sexual harassment made by two female employees. At this time the plaintiff was staying at home and came back to work shortly before the Christmas holidays. He worked with Mr Chaloner for a week at this time and then for another week or so early in January 1997. During this time Mr Chaloner's conduct changed in that his use of abusive and insulting language stopped, no doubt attributable to the fact that he was under investigation. 60 In the latter part of 1996, the plaintiff became aware that two female employees (Ms Samantha Hunter and Ms Megan Moyle) commenced proceedings against Mr Chaloner in the Anti-Discrimination Commission. He was informed of this by Mr Paine and he was aware of the identity of the employees. Indeed, he said that Mr Chaloner had abused him on a number of occasions in their presence. The plaintiff himself was present at times when Mr Chaloner made inappropriate sexual remarks about Ms Hunter. 61 The Human Resources Manager for News was a Ms Sandra McDiarmid. The plaintiff said that Mr Paine came to his office and said that Sandra McDiarmid wanted to talk to him about the allegations made by the female employees and accompanied him to her office. The plaintiff said that either before he saw Ms McDiarmid or afterwards - he was not sure which - Mr Paine told him that if he was asked whether he was aware of any of the allegations made he should say that he was not aware of anything. Of course, the character of this suggestion is very different if it was made before he spoke to Ms McDiarmid, when it suggests he should not disclose what he knew or made after he spoke to her, which merely suggests, in effect, he should keep the matter confidential. In the result, I am not prepared to accept that the plaintiff's recollection about the precise terms of this conversation is completely reliable. I am not, therefore, prepared to infer that Mr Paine gave the plaintiff any improper direction or attempted inappropriately to influence him. 62 The plaintiff said that when he entered Ms McDiarmid's office she told him, in substance, that a number of allegations had been made against Mr Chaloner and that he must cooperate with the enquiry and tell the truth or else he would be in trouble. Mr Blinkworth was there at the time. A telephone call came for Ms McDiarmid and she asked the two men to go into the next office, talk about the matter and return. When they got to the office the plaintiff said that Mr Blinkworth said to him, "Dave, this is the time to spill it all out" adding that he should make sure that the plaintiff did not mention his name as he wasn't aware of anything. The plaintiff said that he did not say anything in reply. 63 The plaintiff said that when he and Mr Blinkworth returned to Ms McDiarmid's office, she said that she had already interviewed a few of the security officers mentioning a number of them including Mr Stuart Windham and Mr Terry O'Dwyer in connection with the allegations made by the female complainants and that these persons had also mentioned that he had been harshly treated by Mr Chaloner. She asked him to tell her about it. The plaintiff commenced telling her about some of Mr Chaloner's abusive behaviour. He said that Ms McDiarmid became tearful (she confirmed this happened) and said that she would speak to him later. The plaintiff said that he asked her "Please do not mention this to Mr Steve Paine, as I was scared as I feel that he is close to Mr Chaloner and it will be very difficult for me to work there with Mr Chaloner in the office". The plaintiff said that Ms McDiarmid said to him that sooner or later she would have to inform Mr Paine about the matter but assured him that she would tell the plaintiff before she did so. The plaintiff said that Ms McDiarmid appeared to be taking a note of what he said to her. 64 The plaintiff said that, following his conversation with Ms McDiarmid, when he returned to his office, Mr Paine walked past, saw him in the office and telephoned to ask him to go for a walk. As they were walking, Mr Paine asked the plaintiff, "How did you go?" The plaintiff told him that, "Everything went OK…Then I told him that I was not aware of anything and he patted me on the back and he said, 'Good on you, mate, go back to your office'." I am not sufficiently confident of the accuracy of the plaintiff's recollection to infer that Mr Paine said anything to the plaintiff that was improper. 65 On the afternoon of the interview with Ms McDiarmid and the conversation with Mr Paine, Mr Chaloner told the plaintiff that Mr Paine had advised him to remove all the diaries and papers which he (Mr Chaloner) had in the office, from the office and he instructed the plaintiff and Mr Windham to place them in the boot of his car. The plaintiff said that whilst this was being done, Mr Paine was also in the car park and saw them there, smiled and left. The diaries were just the usual News' diaries used regularly by Mr Chaloner. On the next day Mr Chaloner told the plaintiff that he burnt these diaries in his backyard and buried the remains. 66 In early 1997 the plaintiff spoke to Mr Blinkworth at Mr Paine's request at Mr Blinkworth's home. The plaintiff said that they discussed "all the things which Lance was doing to me". He said that Mr Blinkworth said, "He's sorry that he could not help me before but he will make sure that nothing like that happens to me again". 67 On or about 21 January 1997 Mr Paine informed the plaintiff that Mr Chaloner had left News. 68 The plaintiff said that one way or another, he complained continuously to Mr Blinkworth about Mr Chaloner's conduct towards him, except so far as the sexual assaults were concerned. He said that Mr Blinkworth's response was invariably to the effect: "I can't believe how he can get away with it. He's a very difficult customer. He's threatening us with the contract all the time. Please, Dave, hang in there and I will see what I can do." 69 The reference to the contract was, of course, the contract between News and Group 4 in respect of the security work, which was obviously a significant part of Group 4's security business.

Other occasions of abuse 70 In September 1996 the plaintiff was involved with the provision of security for the Super League premises and the residence of Mr Lachlan Murdoch. At this time Mr Chaloner was on leave. During a telephone conversation the plaintiff assured Mr Chaloner that all was going well. Shortly after that conversation was completed, Mr Chaloner called him back and abused him, suggesting that he was using the opportunity to obtain credit for himself for this work at the cost of Mr Chaloner. This allegation was associated again with insulting language. The project concerning the Murdoch home and associated premises was a substantial one that continued for a week or two. When it was completed, the plaintiff received a complimentary letter from the CEO of Super League, which was given in the first instance to Mr Paine to pass on to the plaintiff. As it happened, Mr Paine showed the letter first to Mr Chaloner who, when the plaintiff went to his office, threw it at him saying "Now you have done it", complaining that he was not happy about not having received a similar letter. 71 The plaintiff said that on many occasions Mr Chaloner stood close to him in a physically threatening way and shouted at him in an abusive and demeaning manner. This behavior frightened him.

The end of the road 72 In about August or September 1996 the plaintiff said that he started feeling ill. He said that he was getting a lot of headaches, that his appetite was suffering and that he was nauseous when he ate. He said that he did not want to go to work or even be at the premises, that he did not want to see Mr Chaloner or hear his voice. He said, "I was just feeling very scared and I never wanted to be there." He said that he was losing his concentration and found it difficult to keep his mind on the job. He said that before he started work at Surry Hills he was a happy person who got on well with the people around him including, in particular, his wife and children. He liked socializing, visiting friends and family and taking his children to social events. He enjoyed watching rugby league and playing soccer with friends and family. However, towards the end of 1996 he felt enervated and, perhaps, suicidal. He said, "I just could not handle it because I was always in tears, and that's how I felt". 73 Two weeks or so later, the plaintiff's house was damaged by two air rifle shots which broke a light on his verandah. He mentioned this to Mr Chaloner and to Mr Alan Miles, requesting time to go home because his wife was alone and, although the police had been called, they had not yet come to the house. At this time Mr Chaloner again played a childish trick on the plaintiff and, when he upset him, started laughing and said, "What, can't you take a joke you black man?" Approximately a week later a security officer working for Group 4 informed the plaintiff that a person had telephoned Group 4 with the threat that he would not live long. About a week or so after the shots were fired the plaintiff and his family returned home from their restaurant to find that his daughter's bedroom had been badly burned and the house was full of smoke. The back door had been jemmied open but it was impossible to tell whether the fire had been deliberately lit. The plaintiff called police and later spoke to Mr Chaloner saying that he would not be coming to work because the police were at his house and he did not feel able to go to work that day. Mr Chaloner said to him, "Even if you have to come with your wife, you can bring her here, but she can't come inside, tell her to stay in the car", insisting that he should come to work to be interviewed about the threats against him. Over the ensuing weeks News provided some security for the plaintiff at his home. As I understand the evidence, no further threats were received and no further attacks were made on the plaintiff or his home and the issues raised by these events have remained unresolved. 74 The significance of these matters is that, not surprisingly, they caused considerable distress to the plaintiff. I could not conclude that they had anything to do with Mr Chaloner, although I gather that the plaintiff thought they might have. They form part of the plaintiff's history and he appears to have attributed a great deal to them, probably because of his by then compromised psychological condition.

The aftermath 75 When Mr Chaloner left News, the plaintiff took over his role, though continuing as an employee of Group 4. News, however, ultimately employed a Mr Gear and then a Mr Blissett in Mr Chaloner's position. The plaintiff said that, although he had significant emotional problems (which I will come to in due course) he considered that at this time he was performing his duties competently. It is obvious that the plaintiff was very upset at failing to take over Mr Chaloner's role. The state of the evidence does not permit any close analysis of his emotional and psychological response to this failure but it was a significant factor in his increasingly depressed feelings. I have no doubt, however, that the extent to which it contributed to his ultimate illness was greatly increased by the vulnerable and fragile state to which he had by then been reduced by Mr Chaloner's unremitting misconduct. In short, the plaintiff had already been pushed over the edge of mental health but although he felt unwell, he was unconscious as yet of the extent of his condition and the direction his life was inexorably taking.

The slide into depression 76 In due course, as 1997 moved on, Group 4 sought to negotiate a new contract with the plaintiff. As before, he did not wish to enter into the proposed contract since it did not sufficiently recognize the value of his services. In short, not enough pay was offered. By this time the plaintiff had separated from his wife because of marital conflict brought about, as I understand it, by the effect on him of his employment. He was drinking heavily, as much as a bottle of whisky on his day off, whether Saturday or Sunday, becoming so drunk that he simply slept. He suffered generally from depression, anxiety and suicidal thoughts. He was unable to concentrate and sleep. He was taking medication but it was not helping. He said that he attempted to commit suicide by taking an overdose and was admitted to hospital in 1998. He continued to work until February 1998, aside from some days off which his general practitioner had required. Eventually, his condition became such that he was unable to complete the work that he was required to do and "did not have the energy to do anything". Following a ham-fisted attempt by both defendants to get the plaintiff to sign a deed of release which, in substance, required him to admit that they were not liable for anything that had occurred to him in the course of his employment, the plaintiff stopped working on 17 February 1998 pursuant to his doctor's advice. 77 Arrangements were made by Group 4, when a workers' compensation claim had been made by the plaintiff, for him to see a Ms Judy Bokor, psychologist and, on 9 November 1998, his employment was terminated. 78 The proffered deed of release, plainly drafted by lawyers retained by the defendants, which the plaintiff declined to sign noted his allegations - "(a) Mr Lance Chaloner, an employee of Nationwide News, unlawfully discriminated against him; and (b) Group 4 is liable for the unlawful discrimination by Mr Chaloner or in the alternative Group 4 has unlawfully discriminated against him."

The proposed deed recited that these allegations were denied both by News and Group 4 and sought the plaintiff's agreement that they had taken "all appropriate steps" to deal with the allegations. The recital to this effect is an admission by the defendants that, indeed, they had taken such steps. These steps should have included, of course, an investigation of the truth or otherwise of the allegations. (This seems to me to be relevant to the exercise of my discretion concerning the limitation period.) 79 I leave aside the extraordinary character of this deed of release, which offered no consideration of any kind and strikes me as an attempt to overbear the plaintiff. It is such an extraordinary document that it is difficult to resist the inference that its proponents were concerned about the nature and seriousness of the plaintiff's allegations and were attempting, while he was still subject to influence, to reduce their risk. I note in this regard Ms McDiarmid's evidence that the plaintiff, in effect, had voluntarily made statements reflected in the proposed deed. Of course, those statements were made at a time when the plaintiff hoped to replace Mr Chaloner. 80 I have already mentioned that the terms of the deed imply that the defendants conducted an investigation of the allegations which was sufficient, at least, to alert them to the likelihood of a claim and the risk of an adverse outcome to any action that the plaintiff might take. The compensation claim, dated 4 March 1998 identified the plaintiff's condition as "diagnosed as having acute major depression…caused due to workplace harassment" and including confusion, frustration, nausea and other injuries. The letter of termination noted that the plaintiff had been prevented from reporting for work "as a result of your medical condition since 17 February 1998" and that medical advice available to Group 4 indicates that "there is no prospect of your being able to resume work in the immediate future, although there is the likelihood of your being able to resume at some time in the future." 81 In December 1997 the plaintiff spoke about his problems at News with Mr Neil Carney, a barrister whose name he had been given by a workmate. He told Mr Carney something of what Mr Chaloner had done and asked whether he could do anything about it. Mr Carney told him, the plaintiff said, that he would be able to do something when his employment was terminated, telling him, "I've got a very good common law case". Indeed, Mr Carney was present at the meeting with Ms McDiarmid, Mr Paine and News' solicitor when the question of the release was discussed. Mr Carney stated at the meeting that the plaintiff would not sign the document.

Did the plaintiff complain? 82 Before seeing Mr Carney (and, I understand, at his request) the plaintiff had prepared a statement about the circumstances of his employment. It is not necessary to deal with everything in that statement. It listed the following complaints - "(i) He was made to start work at 6.30 am and finish at midnight or even later six days a week and sometimes seven days for eighteen months from April 1992 whilst being only paid for eight hours a day. (ii) Mr Chaloner abused him by using names such as cocoanut [sic] head, monkey face, only a black man, poofter etc not only in private conversation but in the presence of contractors, security personnel and News staff. (iii) Mr Chaloner would telephone him and shout. (iv) Any complaints made by the plaintiff or attempts to discuss his (Mr Chaloner's) behaviour was responded to by threats to transfer him from News or otherwise "get rid of you". (v) Mr Chaloner instructed Mr Naidu that he could not speak to anyone at News, especially Mr Paine "because Steve does not like me" and he would lose his job if he informed Securitas. (vi) "Lance would always like to find a simple thing to talk about and make it a big issue to have a go at me. He used to call me: you fucking black cunt, I will do you, I will put you on the floor and sometimes he will get so angry that he will hit the wall of the office and make a hole, this was witnessed by some of the security officers." (vii) Other allegations, stated in considerable detail, consistent with his evidence which I have set out above." 83 The detailed allegations made by the plaintiff are set out under headings identifying the relevant year. At the end of the entry relating to 1995 the following appears - "I only wished at that time that I could find a job like the one I had. I would have left him long ago." "During the Christmas holidays I went back to Fiji to see my mum. She was much better but not allowed to travel by air for some time. I was told by Lance to contact News Limited every second day to get the update because he was also on leave at home. I had to do it for my job's sake."

The document concluded in this way - "At this point of time I am very down and whichever way I look I see darkness and I don't value my life no more and I have lost my interest in work which I loved with my heart. I therefore would like to put a claim against either one or both the companies concerned as you see fit for all the pain, suffering, stress, depression and threats which I had to go through in my life. Due to this not only have I lost my family business, my respect, above all which cannot be replaced by anything in life is my family and my happiness. I have been left with sorrow and sadness in my life where I can neither trust nor have faith in any one for ever till I live." 84 It is a somewhat startling fact, in light of the plaintiff's evidence about his continuous complaints to Mr Blinkworth about Mr Chaloner's behaviour that, in the course of a long, detailed and discursive document he does not mention Mr Blinkworth at all, let alone that he made any complaints to Group 4 or that he was told that Mr Chaloner would be spoken to but to attempt to get on with him in the meantime. 85 On 18 March 1998 the plaintiff was interviewed by a Ms Phillipa Moss, an investigator employed by Group 4. A draft statement was prepared for him to sign. The plaintiff gave evidence that the statement was a correct record of what he had said. Amongst other things it contains a brief account of the plaintiff's employment at News as Mr Chaloner's assistant. It stated - "19. My stress condition now has resulted from continued abuse, victimization, harassment and discrimination from Lance over the past 5 years. I have prepared a 15 page document describing the circumstances of what occurred. I have initialed the bottom right hand corner of each page and will supply the MMI representative with a copy rather than repeat the details within this statement."

In a further paragraph the plaintiff is noted as having said - "21. Since October 1997 I report to the Operations Manager at Group 4 Securitas, Ron HUNT based at Gladesville. He is aware of all the problems I have had. Prior to that I reported to the General Manager Charles BLINKWORTH and Alan MILES, both still employed by Group 4 but now in the Tempo section. They can be contacted on 02 9844 2000." 86 Most significantly the plaintiff told Ms Moss - "24. I never reported any of the incidents I have written about to anyone. I was concerned Group 4 would lose the contract with News Ltd if I told anyone so I just put up with it. I don't know how or why I put up with it for so long but there were a lot of people aware of what was happening, employees of both companies. 25. From New Ltd, Haitham KAMALADINE, the architect was aware of my treatment by Lance and he can be contacted on 02 92883969, business hours or a message can be left. I think he is now on leave for 2 weeks. Also Lance's secretary, Megan MOYLE, who has now left News Ltd can be contacted on 0411 832 821. 26. From Group 4 the security officers, David PERNAT, Stuart WINDHAM, Frances GHAZAWI, Kelly MAVRITSIS (still employed there), Terry O'DWYER, Peter SMITH (still employed there), Tanya POOLE, Hussein O'DEMIS (still employed there) and Samantha HUNTER a former supervisor. They are based at Chullora and can be contacted on 02 9288 1990. The ones who are still employed by Group 4 can possibly supply telephone numbers for the ones who have left. 27. There were also numerous sub contractors and business people but at this stage I don't want them involved until my barrister can assess the situation." 87 When identifying the statement in evidence and accepting that it fairly represented what he had said to Ms Moss, the plaintiff said that there was one matter that he wished to explain. He agreed that paragraph 24, as set out above, was what he had told the investigator but explained it in this way - "The only reason at that point in time I didn't mention Mr Charles Blinkworth at the time was a problem I was facing after Mr Blinkworth's departure and I was told by Mr Blinkworth if I ever got asked not to mention his name, that he was not aware of anything in regards to my problem."

The plaintiff said in evidence that he told the investigator what is contained in para 24 knowing that it was untrue. The plaintiff told Ms Moss that he did not wish to sign the draft statement which he had prepared until his barrister (Mr Carney) had looked it over and that Mr Carney told him not to sign it. He said that he had shown the statement to Mr Carney and had discussed it with him but that he could not remember discussing para 24. Leaving aside the possible effects of the plaintiff's mental state, it is difficult indeed to accept that he would not have brought to Mr Carney's attention that what he said in para 24 was untrue. In evidence he said that he lied to Ms Moss about the matter in that paragraph "because I was scared". 88 The plaintiff's evidence about this matter is hard to understand and difficult to accept. He said that he was very frightened of Mr Chaloner, not only in respect of the possibility of losing his work, but also of physical injury and yet he told Mr Blinkworth frequently about Mr Chaloner's misconduct. He could only have done so for the purpose of Mr Blinkworth correcting the situation. That could not occur, of course, unless Mr Blinkworth raised with Mr Chaloner his misconduct towards the plaintiff, and this despite Mr Chaloner's threats. 89 The plaintiff has not suggested that Mr Blinkworth ever threatened him or suggested that his work was at risk except perhaps in the general sense that Mr Chaloner had (the plaintiff said) the power to adversely affect the continuance of Group 4's security contract with News. Still less is it easy to understand the evidence which I have set out above about why he did not mention to Mr Carney in the lengthy statement which he prepared at his request the fact that he made complaints to Mr Blinkworth or why he positively lied about the matter in his statement to Ms Moss which he also showed to Mr Carney but which he cannot remember correcting. His explanation for the "lie", when pressed, was that he was frightened in March 1998 that he might lose his employment with Group 4 if he made allegations that Mr Blinkworth knew what was going on. 90 When he gave his history to Dr David Butler - his treating psychiatrist, whose reports I deal with later - the plaintiff told him that his wife repeatedly tried to get him to stand up for himself or leave his job but he refused to do this because he took great pride in his work and did not want to lose what he felt was such a good job. This history was taken on 6 June 1997. 91 In December 1999 his then solicitor, Mr George Draca, asked the plaintiff to prepare a full statement of what had happened to him. That statement was made about that time and has been tendered. It contains many references in the main consistent with his evidence that he frequently complained to Mr Blinkworth in greater or lesser detail about Mr Chaloner's misconduct towards him. 92 Mr Blinkworth, whose evidence I deal with below, denies that the plaintiff told him about Mr Chaloner's misconduct. In the end, I consider that the probabilities favour the essential truthfulness and reliability of Mr Blinkworth's account over that of the plaintiff. I would not go so far as to say that the plaintiff has deliberately lied about this matter since I would accept that he complained from time to time to Mr Blinkworth about Mr Chaloner's unreasonable demands and the amount of direct management control he was exercising over the plaintiff's own responsibilities on behalf of Group 4. As I have already said, I think it may well be that, over the years, the plaintiff has come to believe that he also complained about the vilification and demeaning behaviour of Mr Chaloner towards him. 93 In substance, apart from some disquiet I had about the way in which the plaintiff gave evidence on this point (rather in the way of repeating a mantra than giving an account of an actual recollection) the statement to the investigator and the failure to mention the matter in his first summary of the circumstances of his case made at the request of his then legal adviser and for the purpose of considering his legal position are to my mind decisively contradictory of his evidence. The explanation that he said nothing about the complaints to Mr Blinkworth because Mr Blinkworth told him to say nothing makes no sense at all in the context in, and considering the purpose for, which the statement was prepared. I am simply unable to reconcile these documents with the probability that the plaintiff did, as he later claimed, report Mr Chaloner's misconduct to Mr Blinkworth. At the same time, it is probable that he mentioned to Mr Blinkworth at some time or another that Mr Chaloner had insulted or demeaned him in some way. However, I am unable to be satisfied on the balance of probabilities that such occasional complaint would or should have conveyed to Mr Blinkworth any real indication of misconduct (which he should have taken further in the sense of an investigation rather than a merely emollient response) amounting to notice that action was or should have been required. Unspecified complaints of this kind would, in the context I think, not have suggested to Mr Blinkworth that any racial or discriminatory harassment was occurring. At the end of the day, it is sufficient for me to say that the plaintiff has not persuaded me more probably than not that Mr Blinkworth was aware of any racial slurs or harmfully demeaning conduct.

The plaintiff's witnesses 94 The plaintiff called a Mr Haitham Kamaledine who was employed by News between June 1990 and June 1998, initially as a draftsman, subsequently as project coordinator in the National Properties Section of the company. Whilst employed by News he worked at its Surry Hills' premises, where the plaintiff was employed. Mr Kamaledine's immediate superior was Mr Stephen Paine. 95 Mr Kamaledine said that on one occasion in the middle of 1995 when he went to speak to Mr Paine he passed Mr Chaloner's office where the main door was open. He saw Mr Chaloner, who was about four or five metres away, facing away from him towards the plaintiff. He heard him abusing the plaintiff, calling him "black boy" and "black cunt". Mr Kamaledine said that the plaintiff was "in tears…was horrified and looked very scared". Mr Kamaledine himself was very concerned about what he had witnessed and, short time later, reported what he had seen to Mr Paine. He said that Mr Payne responded, "Leave it with me, I'll see what I can do". Mr Kamaledine commented that "he looked very depressed about it". 96 Mr Kamaledine had seen a number of interchanges between Mr Chaloner and the plaintiff and recollected an example from an occasion prior to that which he witnessed in Mr Chaloner's office when, during a telephone conversation with the plaintiff, he heard Mr Chaloner "continuously keep calling him 'monkey boy' or 'monkey face'", he was uncertain which. He said that Mr Chaloner's tone of voice was aggressive. The telephone call occurred, perhaps, a year before the office incident. Mr Kamaledine said that he frequently witnessed Mr Chaloner making derogatory references to the plaintiff. These occurred in the hallway of the building, in their office, in Mr Kamaledine's office and in other parts of the building where he would be present to discuss certain projects. He heard Mr Chaloner calling the plaintiff "boofhead", "poofter" and "hopeless" but these were only some of the names that he could recall being used. 97 Mr Kameledine said that other people were around during this abuse. He said they included Group 4 employees and News employees, naming in respect of the former class, Mr Terry O'Dwyer and also a supervisor whose first name was Fred, a night supervisor whose first name was Frances and News' staff including his secretary, Gira Thanapalin. He said that other staff members belonging to the purchasing department "would quite regularly hear the abuse". Mr Kamaledine observed Mr Chaloner's interaction with other staff as well as the plaintiff but none were treated in the way that the plaintiff was treated. Mr Kamaledine said that he did not see the plaintiff protest at Mr Chaloner's abuse: "He looked very depressed". 98 Mr Kamaledine said that he did not again approach Mr Paine about Mr Chaloner's behaviour, as I understand it, because he felt that informing Mr Paine should have been enough. He enquired of the plaintiff whether Mr Paine had asked him about Mr Chaloner's behaviour and was told that he had not. When asked why he had not earlier made a complaint to Mr Paine about the conduct of Mr Chaloner towards the plaintiff he said - "Well, sometimes you just don't report things until you feel it's the right time, until you realize enough is enough and that's when I made the move." 99 Mr Kamaledine said that Mr Chaloner's behaviour was usually (as I understood him) aggressive and several times he threw furniture around in an angry response to the performance of his staff. When "things did not go quite right by way of timetable", he would lose his temper easily. On one occasion he saw Mr Chaloner leave his office and noticed that Ms Hunter was in tears. She told him that she had just been abused but asked him not to do anything. 100 Mr Kamaledine said that he often observed that the plaintiff was still at work when he left after completing his working day. 101 Mr Kamaledine said that Mr Chaloner approached him to design a house for him, that he approached Mr Paine about whether this was proper and was told that as long as he did it outside business hours there would be no objection. Mr Kamaledine said that he did design a house for Mr Chaloner. On one occasion, Mr Kamaledine said, Mr Chaloner asked him to go to his property to mark out the entrance or gateway because he was unable to get any bricklayers. Mr Kamaledine eventually agreed to do this on a Saturday and Mr Chaloner arranged for the plaintiff to collect Mr Kamaledine and bring him to the property. Mr Kamaledine was surprised, when they got to the property, to see the plaintiff put on gloves and start working with Gyprock wall lining about half an hour after they arrived. On their way to the property, Mr Kamaledine asked the plaintiff how was it that he was taking him there. He said that the plaintiff told him that he had been "ordered by Lance Chaloner to pick me up from my home on Saturday morning and to drop me off at the property". There was no conversation about whether the plaintiff had worked or would be working at the property. 102 Mr Kamaledine also related an example of comments made to him by Mr Chaloner in October 1993 that he found very offensive. He also said that there were many occasions on which Mr Chaloner would make sexist remarks to or about women. 103 Mr Kamaledine said that when the plaintiff first came to work at News he was enthusiastic, honest, dedicated, reliable, sincere and also sensitive. He said that he was a quiet person, very friendly and very co-operative. As the years went past, however, Mr Kamaledine noticed that the plaintiff became progressively more quiet and, as it seemed to him, more depressed. He would interact less and avoided contact with him and, as I understand it, other staff. He said that he saw him "always in tears" from about mid-1995 onwards. 104 Mr Kamaledine recalled that News conducted an anti-discrimination course from 1996 onwards, in which it was compulsory for all employees to participate. He thought that almost certainly Mr Chaloner had done so. Mr Kamaledine said that so far as he could observe the plaintiff was popular with both News and Group 4 employees and appeared to be on good terms with Mr Paine in particular. He conceded that he did not see the plaintiff crying outside his office but that on most occasions as he moved around the premises "he would have teary eyes". 105 On further cross-examination, Mr Kamaledine confirmed that he was completely confident that his recollection about the conversation he had with Mr Paine was accurate and reliable. On the other hand, he agreed that he had not been asked to recall whether he had such a conversation until about a week before he gave evidence which, it is clear enough, occurred some eight or nine years previously. 106 Mr Hassan O'Demis had been employed by TNT Security between 1991 and 1993 as a security officer at the Surry Hills' premises of News. He re-joined Group 4 as a security officer again at the News' site in 1996 although he worked from time to time at their Chullora premises. He left Group 4 in April 2000. He said that he first got to know the plaintiff during his first stint as a security officer at Surry Hills. He said that at that time the plaintiff was a nice, cheery and confident person, friendly and gregarious and socialized on the premises with other staff members from time to time. He said that Mr Chaloner who, of course, he also knew, was generally overbearing in his approach to other people. Although he did not use foul language to Mr O'Demis, he heard him use such language quite a lot to other people and recalled him on one occasion saying to the plaintiff, "come here, you black cunt". This occurred near Mr Chaloner's office at the Surry Hills premises but Mr O'Demis could not recall when. Mr O'Demis said that this language did not surprise him, as he thought it was consistent with the loud and obnoxious way in which he had heard Mr Chaloner generally speak to people, and which was usually the way in which he communicated with the plaintiff. He said that the Group 4 staff would discuss from time to time the nature of the relationship between the plaintiff and Mr Chaloner, focusing on how badly Mr Chaloner treated the plaintiff. 107 When Mr O'Demis returned to work for Group 4 in 1996 he noticed that the plaintiff appeared to be "quite afraid" of Mr Chaloner: "He would always be a bit passive, quiet and afraid to say or do anything wrong in front of him". He confirmed that the plaintiff mentioned to him that he used to go and do work for Mr Chaloner on his property. He confirmed also the plaintiff's apparent long working hours. Generally, when Mr O'Demis returned in 1996, he noticed that the plaintiff was more quiet, looked tired all the time and did not seem to be his "old, confident self". He seemed more withdrawn from the other employees and he saw him from time to time with red eyes as though he had been crying. He said that he visited the plaintiff when he was admitted to the St John of God Hospital in late 1998 and noticed that he seemed "very depressed…and very worn out, tired". 108 Mr O'Demis agreed that the plaintiff never actually complained to him about the way Mr Chaloner treated him. He did not suggest that he should talk to Mr Blinkworth about it. Indeed, he could not recall whether Mr Blinkworth was often or only rarely at the premises although, as Mr Blinkworth was relatively senior, he would not have had any interaction with him anyway. 109 Ms Tania Poole was employed by Group 4 as a security officer, holding the position of a leading hand site supervisor at Surry Hills and Chullora, leaving that employment in late 1996. Ms Poole recalled occasions on which Mr Chaloner made racial remarks to the plaintiff, calling him "his little black boy". The plaintiff would look embarrassed but would just walk away and never respond. These things were heard by Ms Poole in the front foyer of the floor where Mr Chaloner and the plaintiff had their offices. She did not know whether other security officers or, for that matter, anyone else, heard these exchanges. Generally speaking, when Ms Poole heard Mr Chaloner talking to the plaintiff, he did so in a patronizing way. She also recalled the plaintiff working long hours, mostly into the evening. Ms Poole recalled that there was discussion amongst Group 4 officers about how the plaintiff was treated by Mr Chaloner. She does not recall precisely what was said. They would "just mention how everyone felt it wasn't right, but we just didn't like it, but what could we do? We were all just little workers at work." Ms Poole said that she did not see Mr Blinkworth very often, although it was necessary for him to go through the necessary security procedures just like anyone else when he came to the premises. She said that when she first met the plaintiff, he was "very relaxed, very nice person and nothing seemed to bother him but by the end of the time that I left he always looked stressed, looked upset and looked tired [and] … withdrawn … it was like the spark had gone from him". 110 Ms Poole agreed that she had worked quite closely with the plaintiff during her time at the Surry Hills' premises but that he did not make any complaint to her about Mr Chaloner's conduct. She thought that she had only seen Mr Blinkworth perhaps five times. Ms Poole never raised with the plaintiff the way in which he was treated by Mr Chaloner because she did not think it was her place to do so. The plaintiff was the senior group foreperson on site and she thought it was not consonant with her position as his subordinate to speak with anybody at Group 4 about him. Ms Poole said that, when the plaintiff was away from Mr Chaloner, he seemed to be a happy, relaxed person. Ms Poole was asked - "Could you just tell us in your own words why you didn't [take matters up with him]. A. I felt that it wasn't up to me as I guess I was young then, didn't know it was the right thing to do so. I didn't really know what was the right thing to do, but we just worked with Dave and no one did it, no one said anything. Everyone just worked with him and stood beside him but never said anything. I didn't feel like it was my place. I guess it was one of those things I never thought about until now."

At the time she commenced work at Surry Hills Ms Poole was about twenty or twenty-one years of age. 111 Mr Dave Pernat worked for Group 4 in 1993 in the control operator room, located at the News' site at Surry Hills and also at Chullora. He commenced part time work but at the start of 1994 he became a permanent employee. He was accountable to Mr Terry O'Dwyer on a day-to-day basis on the job. In 1994 he was stationed both at Chullora and Surry Hills but in 1995 and in 1996 at Chullora. He recalled on one occasion in 1996 whilst he was in Chullora that the plaintiff, Mr Chaloner, Mr Terry O'Dwyer and a Mr Ian Phillips, who was a contractor, were present at the site. He recalled that, while giving directions to the plaintiff, Mr Chaloner called him "black man" and "curry-muncher". His language was "very forceful. It is clear that he was not joking". Mr Pernat said that he knew Mr Blinkworth but, whilst he was working at Chullora, had never actually spoken to him. He said that he saw him on the odd occasion at Surry Hills but, again, did not speak to him. At the time that he saw him, Mr Blinkworth was in a meeting with Mr Chaloner and the plaintiff. 112 Mr Ian Phillips is the principal and managing director of a firm that undertakes work in the security industry. In 1993 it was contracted to News to make and maintain physical security barriers, slide gates, boom gates and the like, alarm systems and some cameras. In the course of this work, he came into contact with Mr Chaloner and also the plaintiff. He said that he often needed to go to News' premises, including at Surry Hills. He dealt with Mr Chaloner probably two days a week during 1993 to 1996. He said that he often saw him in the plaintiff's company. He noticed that Mr Chaloner swore at the plaintiff a lot, using phrases such as "fucking black man", what Mr Phillips called "the C word", "you twat", "you black man", "coconut". He said, "there was just a repertoire of words". He said that on the times that he saw the plaintiff and Mr Chaloner together, such language was used by Mr Chaloner from a quarter to a third of the time. He said that he saw them about two or three days a week and on every day at some point there would be an exchange of this kind. He said that this language was used by Mr Chaloner in relation to his directions for work connected with News. Mr Phillips said that also present when this kind of language was used were Terry O'Dwyer and the women at reception. 113 Mr Phillips said, in effect, that Mr Chaloner got him to do fencing work at his new house in Kenthurst over a nine month period in 1995-1996 against the implicit threat of losing his contract with News. Over the nine month period in question, Mr Phillips visited Mr Chaloner's home at Kenthurst, at first on Saturdays, then the whole of the weekend and then included Fridays or half a day on Friday. He said that he saw the plaintiff present doing "labouring style work, cutting bricks on a brick saw, digging holes. He saw him there on each occasion that he was also there except if he telephoned and said that he could not make it. Mr Phillips said that from time to time whilst he was at Mr Chaloner's house and the plaintiff also was there, he would be called on his mobile telephone by, amongst others, Mr Terry O'Dwyer, trying to track down the plaintiff and he would then pass his phone on to him. He said that Mr Chaloner treated the plaintiff badly. He would not offer the plaintiff any lunch and, when Mr Phillips suggested that he should, Mr Chaloner would say, "No, he's just a black man and he doesn't need to have food anyway". 114 Mr Phillips recalled on one occasion being in a car with Mr Chaloner when the latter had a conversation over the hands-free mobile with Mr Blinkworth. Mr Chaloner was insisting that Mr Blinkworth should telephone the plaintiff to ask him to come back to work despite the fact that he had been in a car accident. 115 Mr Phillips also heard Mr Chaloner make derogatory and insulting remarks about the plaintiff's wife to the plaintiff. He said that the plaintiff did not respond although he looked shocked. On one occasion, he saw Mr Chaloner ask the plaintiff to find a particular file which Mr Chaloner had actually hidden. When the "joke" was exposed to the plaintiff's discomfiture, Mr Chaloner simply commented, "You're just a black man". On one occasion Mr Phillips said he saw the plaintiff starting to cry with Mr Chaloner's response being to aggressively tell him "stop acting like a baby". Mr Phillips also recalled the incident to which I have already referred when dealing with Mr Pernat's evidence. He confirmed as well the plaintiff's long working hours and Mr Chaloner's refusal to permit the plaintiff to go to the toilet on occasions. 116 Mr Sam El-Rahim, in 1992 and following, conducted a security electronics business provided electronic security at the News' site in Surry Hills with four or five employees working at those premises on a regular basis. Mr El-Rahim visited the site from time to time, having dealings in the course of those visits with Mr Chaloner. On average, he said that he was there two or maybe three times a week and would stay a couple of hours on each occasion. He knew the plaintiff, to whom he also spoke from time to time, and also, naturally enough, other contractors and employees working there. He said that Mr Chaloner was a demanding person to deal with and from time to time made unreasonable demands. He said that he observed Mr Chaloner's communications not only with contractors but also with his personal staff, including the plaintiff, and said that on occasions he would raise his voice at the plaintiff and also use demeaning and racist comments towards him. He said it was obvious that the plaintiff was distressed. 117 Mr El-Rahim said that in Mr Chaloner's presence the plaintiff became nervous and withdrawn and - as I understood the evidence - subservient. He said that the plaintiff mentioned to him that he was required to go to work on Mr Chaloner's property at Kenthurst and that he had been forced to do this. Mr El-Rahim told the plaintiff that he did not have to do it and should not go but could not recall his response, although Mr El-Rahim thought that he did this work because he feared for his job. He said that Mr Chaloner constantly threatened the contractors on the site that he would use his influence to terminate contracts if things were not done as he required. The plaintiff also told Mr El-Rahim about the long hours that he had to work. 118 Mr El-Rahim said that the plaintiff complained to him from time to time about Mr Chaloner's conduct towards him but, so far as he could recall, they were general complaints about his behaviour and he could not remember any detailed complaints. In cross-examination, Mr El-Rahim agreed that the complaints which he had become aware of relating to the plaintiff occurred, or could have occurred, towards the end of 1996 or at the beginning of 1997 rather than during the whole of the period during which this firm was involved with News at the Surry Hills site. He also agreed that, when he saw the plaintiff in the presence of Group 4 employees, he appeared to be a popular man and he seemed to be happy. He also said that, at times, the plaintiff appeared to be on good terms with Mr Chaloner. In re-examination he said that Mr Chaloner's demeaning conduct towards the plaintiff occurred throughout the period from 1992 that his firm worked at the site. 119 On 30 April 1998, Mr Stuart Windham, then security controller for Group 4 (with which he had worked for eight years) made a statement concerning the conduct of Mr Chaloner. He stated that he worked on the News' sites at Chullora and Surry Hills in the position of supervisor between April 1990 and January 1998. He worked together with the plaintiff as a fellow employee of Group 4. It is significant, I think, that he described Mr Chaloner as being his "overall boss". He said that when he worked with the plaintiff he heard Mr Chaloner call him a "black bastard", "elephant boy" and "cunt". On one occasion he recalled Chaloner ordering the plaintiff and him to attend a strike at the News' site at Parramatta threatening that if they did not go to the site, he would make sure that they lost their jobs. It is clear that Mr Windham believed that Mr Chaloner could make good this threat. He said that Mr Chaloner "always called David names and made racist slurs against him". He said that he witnessed Mr Chaloner physically threaten the plaintiff and "he was always putting him down and ordering him about". He said that Mr Chaloner appeared to enjoy ordering people around and was "very intimidating to the staff". He said that when the plaintiff was insulted by Mr Chaloner, it made him visibly upset "although he appeared to laugh it off". He added, "We all knew he had to take the treatment dished out by Chaloner as we wanted to keep our jobs". Mr Windham also said - "In the early times when the company was called TNT we did complain to the management about the treatment we received from Chaloner, however, they did nothing about it. The difficulty was Chaloner was a customer and, I suppose in their eyes, the customer is always right."

In the circumstances, I would not accept this paragraph as suggesting that complaints were made about Mr Chaloner's behaviour towards the plaintiff as an individual, in particular, I do not think it implies that the vilification of and the demeaning conduct towards the plaintiff was part of the complaints made. 120 The plaintiff relies in particular upon the following - "19. I recall one incident around 3 May 1996 when Chaloner demoted me from being supervisor to bring in a female supervisor because of equal opportunity. I was told I was being demoted because of my poor work performance, and I took exception to this. I was working on the site 50 to 60 hours per week. 20. I spoke to Alan Miles and Charles Blinkworth at Group 4 and lodged a complaint with them about being demoted by Chaloner. Also during this conversation I informed them of the way Chaloner treated the security personnel on the site, myself and David included. Both Miles and Blinkworth just sat nodding their heads at me however nothing was done." 121 Mr Windham's statement gives significant support to the plaintiff's complaints about being subjected to racial insults by Mr Chaloner, being required to work on his house and also his very long work hours. Mr Windham's statement implies, however, that the plaintiff did not make any complaints so far as he (Mr Windham) was aware until (as I take it) the time when the sexual harassment complaints were being investigated. I draw this inference from the following paragraphs - "23. David put up with the treatment he received from Chaloner because he wanted to keep his job. We all put up with the treatment because we needed our jobs and we knew Chaloner had contacts within the industry. … 26. It just got to the stage where David no longer wanted to put up with the treatment he received from Mr Chaloner so he brought it out into the open and once it was in the open I believe it got too much for him." 122 In the result neither Mr Windham nor Mr Miles were called. Mr Blinkworth (whose evidence is discussed below) denied a conversation occurred as asserted in para 20 of Mr Windham's statement. 123 The plaintiff also relied on a conversation between Mr Blinkworth and himself that occurred in February 1996 that the plaintiff tape-recorded. The subject matter principally concerned the plaintiff's attendance at the hospital after his motor vehicle accident and his need for physiotherapy and other medical treatment. The plaintiff said that he spoke to Mr Chaloner about it but that Mr Chaloner was not happy, in effect, because the plaintiff needed to take time off work and asserted that Mr Blinkworth was not happy about it either. Mr Blinkworth agreed that Mr Chaloner "was pretty upset yesterday, you know what I mean" and the plaintiff said "yeah, I can understand it's just putting your name down I know that", plainly meaning that Mr Chaloner's assertion about Mr Blinkworth's attitude was mendacious. Mr Blinkworth said, in effect, that he understood the plaintiff's position but added, "I can't do much, as you know". The plaintiff's response, "I completely know about - I do appreciate that" certainly gives support for his evidence that he accepted that Mr Blinkworth either would or could do nothing about Mr Chaloner's demands or complaints. Mr Blinkworth then told the plaintiff, by way of giving an example of Mr Chaloner's demands, that although he had a speech to give at a conference on the day before, he had to cancel and go in to see Mr Chaloner instead. The thrust of the conversation, however, concerns Mr Chaloner's largely contemporaneous demands arising out of the plaintiff's absence from work as a result of the accident and an issue involving the printing of cards. What seems to me to be significant about the plaintiff's complaint in this regard, however, is that although he certainly relates the use of some offensive language, that language is really by way of emphasis rather than being insulting and, perhaps as significant, involves no vilification or, indeed, any demeaning language. Towards the end of the conversation, Mr Blinkworth said, "Look, Dave, I know he's got some very, very funny ways, my friend, you know." The plaintiff responded, "Him, funny ways, Charles? He's got a million funny ways". The sense of this exchange, which was relied on heavily by counsel for the plaintiff, is made clear, however, by Mr Blinkworth's response, "You know, I know that and you know that and we've got to live by them sometimes". It is clear that this response does not indicate or suggest any offensive or insulting conduct but rather demands about the way in which the security contract is performed. The next exchange - "CB: I just try and get on with him. I think I get on all right with Lance. Plaintiff: I mean, I've done it for the last four years closely with him…and if anyone would have gone through that that would have been the disastrous thing…I mean, like he said to Terry this afternoon, when Terry gave me a call, he said, 'Can you call Lance'. I said, 'Yes, no worries and I said well what's wrong?' He said 'Lance, when he told Lance that I wasn't going to come in until this Friday and Lance said to him, 'Tell Dave that I'm the one who's paying his money and I can stop his money any day' and I said, 'Terry, OK mate no worries'. "

Again, although this indicates a somewhat unreasonable demand and an inaccurate statement about the precise employment position, there is no hint whatever of insult or offence. 124 I mention that, tendered by News were a sympathy card, a Christmas card and a post card addressed by the plaintiff to Mr Chaloner. The relevance of this material was, I think, to demonstrate that the plaintiff had overstated the extent of Mr Chaloner's misconduct or the extent to which he was disturbed and upset by it. I do not regard the sending of these communications or what the plaintiff said in them as significant.

The evidence of the plaintiff's wife 125 The plaintiff's wife, Mrs Rena Naidu, was a witness in the proceedings. What follows is a summary of her evidence. Mrs Naidu said that she and the plaintiff met in 1984 when they were in Australia, that they were married in April 1985 and have two children, a boy born in December 1986 and a girl in May 1989. Mrs Naidu recalls that, shortly after he commenced work as a security officer at News, he was appointed to the position, as she understood it, of assisting Mr Chaloner. She said that from time to time after that, her husband came home angry because of work and on occasions complained about Mr Chaloner's racist vilification of him, although she cannot now remember the details of what the plaintiff said. She recalled that these things were mentioned to her from time to time and that, when he did raise them, the plaintiff was distressed. She recalls from time to time being in a company car with a hands-free mobile phone when her husband received telephone calls from Mr Chaloner. Again, she could not remember exactly what was said but remembered that Mr Chaloner's language was abusive and that he was very demanding. She found it difficult to remember the plaintiff's actual hours of work except that they were so long that - "All I can tell is like my kids used to see Dave only on the weekends, because when Dave used to leave for work the kids were always in bed and when he used to come home they were in bed. They were only seeing their father on the weekends." 126 She said that the plaintiff would frequently come home at about 1 am because she would go to Wyong station to pick him up at about 1.15 am "most of the time". 127 She confirmed from time to time she spoke to Mr Chaloner to complain about her husband's long hours. She said that she and her husband had arguments about this, that she wanted him to do something about it but that he would respond that, "Rena, it won't be long, it won't be long". She said that the plaintiff had totally changed, that it was really easy to talk to him before but now it was very hard to have a conversation with him and that this commenced to happen whilst he was employed. From time to time he appeared to be depressed. 128 When he started at News, the two of them made financial and other family decisions following mutual discussions but that now she had to make all the decisions herself because he lacks any interest in making them despite attempts by her to get him involved in the details. She has to care for him - "I have to be on him all the time, like when he takes his tablets, with his food, like he always wants to refuse to eat food and his dinner."

She said that they have stopped socialising with the friends that they used to have because her husband does not want to visit and just wants to stay home. She said that she had "to force him to do things" such as go outside for example to visit a club to which Mrs Naidu is in the habit of going "to get out of the house and…to play the pokies for a while". She said that he comes with her most of the time although this happens with great difficulty. I interpolate here that she was extensively cross-examined about an occasion when her husband went to a club with her and, as it seemed from videotape of the occasion, appeared to be coping quite well by himself. I do not propose to reprise in this judgment the extensive evidence about this subject matter. I do not think that it reflects significantly either on the plaintiff's credibility (or, for that matter, on Mrs Naidu's) or the reliability of the medical evidence called by him. 129 Mrs Naidu confirmed that in May 1997 she and the plaintiff separated at her initiative because his problems at work had implications for the family which made it too difficult for her to tolerate. She cared for the children and they remained separated until 1999. She says that his moods changed all the time, sometimes appearing distressed with what she took to be visions and, at night, nightmares. When the plaintiff started work at News, he and his wife had a good sexual relationship but, from 1993 onwards this was adversely affected by personal tensions between them, I take it because of work, but also because he came home so late that she would be asleep. She said that their sexual relations eased off and eventually stopped although she was uncertain at what point this happened. Since they resumed cohabitation after mid-1999 she said that there sexual relationship has "not really" resumed. 130 Mrs Naidu agreed in cross-examination that, although she could not recall precisely when it was, sometime after 1993 she wanted her husband to leave his job at News Limited and suggested he should go and get another one but that he responded, "I love this job. I don't want to leave." They had this conversation many times over the years. Indeed, Mrs Naidu said that she thought her husband was proud that he was able to do a difficult job whilst working at News from 1992 through to 1998 and in the application of his computer skills to the technical problems which his work presented. 131 They had a vacation in India (although this date is not clear) and he improved noticeably over that time and in 1999 he coached their son's soccer team for which he received a jacket as a trophy although she did not agree that this was a "good period" for him; certainly she thought it was beneficial for him to undertake this activity. She said her husband over the past few years had not been employed and had not looked for work.

The evidence of Mr Blinkworth 132 Mr Charles Blinkworth was called by Group 4. At the time of giving evidence he was Executive General Manager, Group 4 Strategy and Development, for Tempo Services Limited, the ultimate holding company of Group 4 Securitas Pty Limited. He said that he had known the plaintiff since about 1992 at a time when he was a principal of a private security company, which was sold to TNT Security Pty Limited in March 1992. (I have ignored the corporate history concerning the relationship between TNT and Group 4. It is immaterial.) In the middle of 1992, Mr Blinkworth transferred his employment to TNT Security and became State Manager for New South Wales for guard services for Group 4. It was part of his role to be an intermediary between Group 4 and News, whose relevant manager was Mr Chaloner. At that time, he said, Mr John Deegan was General Manager at TNT whose counterpart at News was Mr Paine. 133 Mr Blinkworth said that, rather than functioning at an operational level "which is looking after…our people on site, making sure that needs are fulfilled, filling shifts, guards and so forth" his was "more client liaison, which was really about looking forward to - for instance, they were in an expansion mode, building premises around Australia in a number of different states - and having a look at what was coming up or down the pipeline (as we call it) for work, and what is the possible requirement going forward: things like that, to make sure there [weren't] any major issues of a service nature that couldn't be put to bed and so forth". 134 Operational managers in Group 4 were a Mr Ron Hunt and a Mr Alan Miles. He said that the plaintiff would report through these two managers. There were a number of supervisors employed by Group 4 at the News' site in Surry Hills, including a Mr Fred Jones and Mr Terry O'Dwyer. The plaintiff, in respect of the onsite operations at News, was in a position superior to that of Mr Jones and Mr Dwyer. He reported to Mr Blinkworth through Mr Alan Miles or Mr Ron Hunt. 135 Mr Blinkworth denied that he ever instructed the plaintiff that he should not report to Group 4 about his activities, in particular, should not speak to Mr Blinkworth about them. It is obvious from what I have already said that Mr Blinkworth did not have direct operational supervision of the plaintiff and was never in that position. Although those he called "my operational people" - meaning Messrs Hunt and Miles - would be on site more frequently, he would visit News, perhaps once or twice a month. He said that he only occasionally spoke to the plaintiff by telephone, although during 1995 and 1996 his conversations might have occurred more frequently. 136 Mr Blinkworth said that the plaintiff never told him that he had been asked by Mr Chaloner to permit the latter's participation in the building of a house for him and his wife on the Central Coast nor that as a result of his refusal to permit this, Mr Chaloner threatened or abused him. Nor did anyone else tell Mr Blinkworth that such behaviour occurred associated with the plaintiff's refusal of Mr Chaloner's request. Mr Blinkworth said that when he was in contact with the plaintiff either by telephone or at the site, before the end of 1996, he did not ever observe him crying or to be in any apparent distress. He said that the plaintiff never complained to him that he was being abused by Mr Chaloner or racially vilified by him, nor did the plaintiff tell him of the names that Mr Chaloner used towards him. He said that the plaintiff never complained about any offensive remarks made by Mr Chaloner towards or about Mrs Naidu. Mr Blinkworth did not himself on any occasion hear Mr Chaloner abuse or insult the plaintiff. In brief, Mr Blinkworth denied that the plaintiff told him about Mr Chaloner's misconduct until it was disclosed after the discrimination investigation conducted by News late in 1996. Mr Blinkworth did recall the occasion when Mrs Naidu was in hospital in respect of a miscarriage and there was some issue about whether the plaintiff could visit his wife or pick her up or something of that kind. Mr Blinkworth said that he recalled speaking to Mr Chaloner about the matter to say that it was a normal request and that he (Mr Blinkworth) gave the plaintiff permission to attend to his wife. 137 Mr Blinkworth also recalled the occasion when the plaintiff needed to go to Fiji when his mother had suffered a stroke. His recollection was that Group 4 gave some financial assistance or other to permit him to visit Fiji. He said that in no way did he attempt to restrict the plaintiff's visit. He also recalled the occasion when the plaintiff went on holidays to Fiji and returned early at Mr Chaloner's request. He said that he played no role in this matter except to be told, either directly or indirectly, by Mr Chaloner that the plaintiff was returning early, that he had already spoken to him about it and "everything was fine". Mr Blinkworth said that this kind of thing was quite normal for a number of supervisors on different sites and he would be reimbursed his entitlements. Mr Blinkworth said that he was unaware that the plaintiff was working on the construction of Mr Chaloner's home at Kenthurst. He was asked - "HIS HONOUR: Q. Had you been aware that at Mr Chaloner's request, indeed insistence, that Mr Naidu should do work for him both during the week and on weekends what would have been your response? A. We had 25,000 employees and we - first of all, there is no other work other than that, the work that is registered by very strict guidelines, particularly for insurance, workers' comp and everything else. It just would not have occurred. It would have just been denied. What he would have done on the weekends is totally up to the individuals, or whatever days they have off. Q. But if he worked at weekends because Mr Chaloner threatened that otherwise his employment might be at risk, would that change the matter? A. Oh, significantly. So we would have taken it - escalated it a lot higher - if that was the case … We would have escalated it a lot higher, both in News Limited and also inside TNT. Q. And when you say "escalated it a lot higher", what do you mean by that? A. Well, there are grievance policies there, first of all. There are particular policies in place in the organization to deal with any particular types of grievances like this, particularly where a client, or for that matter anyone, has threats of different types, whether it be out of a racial type or sexual type or anything, he would be investigated out fully… Q. And if it had come to your attention that Mr Chaloner was threatening Mr Naidu with a transfer from his employment unless he was to build fences and do work for Mr Chaloner at Mr Chaloner's private residence what would your attitude have been? A. Well, certainly, well one - we wouldn't have allowed that behaviour to occur.

Q. What steps would you have taken? A. We would have investigated that first of all. We would have taken him out of harm, or any person we would have taken them out of harm's way. If that's the case I would have escalated it up to John Deegan.

Q. That's your superior? A. Was the highest person with, inside TNT Group 4 at that time. He had a direct relationship with Steve Paine and I know on different occasions on John would have talked to directors of TNT that were very closely linked to Ken Cowley and so forth.

Q. I want to ask you about - and this is perhaps convenient - the contractual arrangements between Group 4 and News Limited whereby the services were provided to News Limited. Did you understand was there a written contract? A. I believe there was, there was an agreement in place. When I certainly came on the scene, you got to understand the relationship between both organisations.

Q. Please tell us? A. Well, TNT and News Limited had both a very close commercial relationship and the directors were common to some degree, I believe. I also opened Ansett and through a number of different occasions when it was either, I am to have a look at, you know, looking at the market, testing contracts or anything else, people like John Deegan, Ross Crib from the site - he was director of the, deputy chairman of TNT at the time - and had a very good relationship with the counterparts in News Limited, so those sorts of things were basically off the top of the tree as we also looked after everything of Ansett as well. It, they were, went for tender.

Q. When you say "at the top of the tree," at an executive level, higher than yourself even, is that right? A. Very much so, yes.

Q. And did you have any concern about the security of the contracts' tenure in the years '92 to '97, say? A. No. Not at all because it, even though I'm a senior - at a very senior level in my organisation and even with Chaloner there wouldn't have been any, he couldn't have terminated it even if he wanted to.

PARKER: Q. Mr Blinkworth, did you believe that Mr Chaloner had the capacity to terminate the News Limited Group 4 Securitas contract in the period '92 to '97? A. No.

HIS HONOUR: Q. He would certainly have to give a reason for proposing such a change and that would have to have been a very good reason indeed? A. Very much so, yes, that's correct.

HIS HONOUR: And the mere fact, for example, that you had made, or Mr Naidu had made an allegation of impropriety against him, out of the way he dealt with staff, would not be useful to him in that context.

HIS HONOUR: I make that observation. Counsel can deal with it. I'm just trying to look at this in a common sense way, really.

KENNEDY: I understand that you give him the answer it's not going to assist your Honour or us.

HIS HONOUR: It was more a comment than a question and your objection is perfectly correct, Mr Kennedy.

PARKER: Q. Mr Blinkworth, is it your belief that in the period 1992 to 1997 Mr Chaloner had the capacity to preemptively terminate the contract between Group 4 and News Limited? A. No." 138 Mr Blinkworth denied that he was ever told by the plaintiff that Mr Chaloner had threatened that the contract between News and Group 4 could be terminated unless he did what Mr Chaloner told him to do. Nor, Mr Blinkworth said, had anyone else told him that. 139 Mr Blinkworth said that he never formed an assessment of the plaintiff's emotional and mental state during the period from June 1992 to the end of 1996. 140 Mr Blinkworth described Mr Chaloner at this time as being "an extremely demanding client…operationally", meaning, I take it, that he was peremptory concerning the provision of security, for example, when extra guards were required, even when it was impractical. Mr Blinkworth formed no view about Mr Chaloner's interpersonal relationships with others. He described his relationship with Mr Chaloner as "very businesslike…in the terms of our industry, very master/servant type…the client and the service provider, it was at very arm's length". 141 Mr Blinkworth's evidence about what might usefully be called the McDiarmid meeting is as follows - "Q. What happened, can you tell us, at the meeting? A. We were actually called up. I think I might have actually been there initially, I am not one hundred percent sure of that. We were called up. Ms McDiarmid I think was the H R Manager or director for News Limited at that time and she was investigating the allegations made on News Limited's behalf. We had our own investigation running at the same time, that is Group 4. We were sitting outside waiting to see her, or thereabouts, and Mr Naidu just started to cry and he was very upset. I said, "Gees Dave, are you all right?" Very specifically I remember him stating that, "You have no idea what Lance Chaloner has done", and he used the word "tortured". I remember that. "He has tortured me and he has had me labour at his house", and he just broke down.

Q. What happened then? A. I said basically, "What is sort of happening over here, what is going on? I know we are up here for Samantha and Megan, but if other things are going on you better explain everything to Sandra. We need to know what is happening. From there we need to conduct an investigation, as we normally do with anything, just like Samantha and Megan".

Q. Did Mr Naidu then reveal a number of matters about his relationship with Mr Chaloner? A. Not there he didn't, no. Subsequent to that I found out different things from the meetings that were had with our - I think it was our HR people at the time, Vicky Carol and different people.

Q. Did you say to Mr Naidu words to the effect, "Now it's time to tell all, but don't tell them anything about me"? A. No.

Q. Did you tell Mr Naidu that he should tell all but he should not reveal that you were aware of all these things happening? A. No.

Q. Up until this point of time, which I think is more or less the December of 96, had you ever been told by Mr Naidu that he had suffered these abuses at the hands of Mr Chaloner? A. No.

Q. You told us that you were outside when Mr Naidu broke down and commenced to cry, and then I assume he went into the meeting with Mrs McDiarmid, is that right? A. We were outside the office, I didn't attend that meeting, David was in quite a state.

Q. Did the meeting take place? A. Yes, it did, but I didn't go in with David.

Q. David, so far as you can recollect, went to the meeting on his own? A. Yes. I was just outside where the meeting took place, I was still just waiting outside.

HIS HONOUR: Q. Waiting for what? A. I just accompanied David up to Sandra McDiarmid, so he was already up there at Sandra's office. So she said, "Can you hang on", and that is when we had this conversation outside her office. I was with David, he was in a pretty fragile state then. She then invited him in and I left then. This took place at News Limited, not at our offices, at News Limited, the office.

PARKER: Q. Was there ever a meeting in which there was you, Mr Naidu and Mrs McDiarmid discussing these matters, in particular Samamtha Hunter and Mrs Moyle and Mr Naidu?

HIS HONOUR: I will not permit this to be given unless you recall Ms McDiarmid, unless you undertake to recall her and cross-examine. Mr Parker, this should not have happened, these matters should have been raised with her in cross-examination

Q. Can you answer that question? A. Sorry, can you repeat that?

Q. Was there ever a meeting at which you were in attendance, Mr Naidu was in attendance with Ms McDiarmid in which the issues of Ms Hunter, Mrs Moyle and Mr Naidu were discussed? A. I really can't recall it, I can't recall that.

HIS HONOUR: Q. Are you saying that it didn't happen or are you saying that it might have happened and you have had a failure of recollection about it? A. It may have happened. To be perfectly honest I think that was the time when we were going into the meeting was to discuss the issues.

Q. That's all you can recall? A. That's right.

Q. As I understand it you are not prepared to deny that such a meeting occurred? A. No, I'm not.

PARKER: I don't think I can take it any further." 142 Elsewhere in his evidence, Mr Blinkworth also said that he did not recall meeting with Mr Paine prior to the McDiarmid meeting nor did he recollect Mr Paine being present or contacting the plaintiff in his presence immediately before this meeting. He said that Mr Paine did not contact the plaintiff in his presence immediately after the meeting either. 143 Mr Blinkworth agreed that the plaintiff's role involved assisting Mr Chaloner on a day to day basis and that there would necessarily be a great deal of interaction between the two of them. The clear thrust of Mr Blinkworth's evidence is that the plaintiff was indeed placed under Mr Chaloner's direct supervision and control as his assistant.

144 News was a significant client of Group 4, which had contracts with the company in five States although not at smaller sites of regional newspapers. Mr Blinkworth agreed that Mr Chaloner was the senior manager in charge of all security for News throughout Australia and it would therefore be reasonable to expect that News would consult him in connection with the letting of security contracts although Mr Chaloner did not conduct any of the negotiations on behalf of Group 4, which he understood were dealt with by Mr John Deegan. Mr Blinkworth did not believe, however, that Mr Chaloner's views would be significant in relation to any possible cancellation of News' contract for security services with Group 4. No doubt the extent to which the services were being provided would be a matter upon which Mr Chaloner's opinions would be considered but Mr Blinkworth said that the contractual or business relationship between Group 4 and News Limited was well above the level both of Mr Chaloner's and Mr Blinkworth's responsibilities: it was at Directors' level. In particular, he did not believe that Mr Chaloner was in a position to have arranged or significantly influenced any decision concerning a proposed cancellation of the contract between Group 4 and News. Even if Mr Chaloner had complained about the adequacy of the service provided by Group 4, Mr Blinkworth said, "I think there would have been a lot of meetings to be had at the senior level before they terminated". Moreover, as is obvious, Mr Chaloner would have to make good any allegations of inadequacy. 145 Although Mr Chaloner may have been capable of creating some embarrassment for Group 4 if he alleged incompetence, I accept Mr Blinkworth's evidence that, in the circumstances, the prospect that he might have been able to cause any significant embarrassment was most unlikely, still less that he could do so by complaining about the plaintiff's conduct in any respect. It is obvious that, in such an event, News would simply require Group 4 to deal with the plaintiff appropriately. 146 There was a deal of other evidence relating to the contended for risk to Group 4's contract with News Limited that might have persuaded Mr Blinkworth not to take up with his management any misconduct of Mr Chaloner's of which he became aware. I do not propose to analyze this evidence in detail. It is sufficient to say that I accept Mr Blinkworth's evidence that he did not believe that Mr Chaloner was capable in any significant way of adversely affecting the relationship between Group 4 and News, not only because of the way in which he impressed me as a witness but also because of the logic of the situation. 147 It does not follow from this that Mr Blinkworth did not from time to time, perhaps frequently, urge the plaintiff to put up with Mr Chaloner's behaviour, but I think that it is improbable that he ever suggested to the plaintiff that he should do so because of such a risk. This is not to say that he did not use language that the plaintiff might have misinterpreted, let alone that Mr Chaloner did not suggest to the plaintiff that he could procure termination of the contract and, hence, the plaintiff's employment. Indeed, I am satisfied that Mr Chaloner did make threats of this kind whenever it seemed useful to do so and that this was likely to have occurred on many occasions. 148 Mr Blinkworth said, although he agreed that Mr Chaloner was a very demanding and often an intimidating personality, he thought he was rather more demanding than intimidating. He could recall only one instance of an attempt at intimidation which, as he related it, struck me as somewhat equivocal. Mr Blinkworth said that he construed "intimidating" as someone who is "standing over you" and said that he never did that to him although he was demanding and unreasonable. The unreasonable conduct, which Mr Blinkworth witnessed, related to an insistence upon making appointments to meet even where it was inconvenient. He said that Mr Chaloner never swore at him. 149 Mr Blinkworth said that the plaintiff did not frequently have communications with him, rather they were from time to time but most of these occurred when there were particular issues of a sensitive kind relating to the security of individuals and that this occurred perhaps half a dozen times over the five years or so that he was involved with Group 4. 150 Mr Blinkworth said that there were policies about employee grievances, occupation health and safety, relating to racial discrimination and other workplace misconduct which, as he understood it, were in place under the terms of relevant enterprise agreements at the time of the plaintiff's employment. In particular, he agreed that the employer - and, I take it, Group 4 in particular - was required to protect employees against intimidating behaviour in the workplace. He denied ever asking the plaintiff, when he was going to a meeting with Mr Chaloner, whether Mr Chaloner was in a good mood. He denied that the plaintiff ever complained to him about Mr Chaloner in any respect although he did need as Mr Blinkworth put it, to "step in" when Mr Chaloner insisted that the plaintiff should work despite his need to attend to a medical appointment because of a motorcar accident. He said that, had the plaintiff complained to him about Mr Chaloner's conduct he would either have put it into the hands of the human resource personnel at Group 4 who would arrange for it to be investigated if it were serious or, if it were of a minor nature, then either he or his group operations manager would telephone to speak to Mr Chaloner and attempt to resolve any particular issues. "Q. If there was…some complaint made to Mr Chaloner, that would not, to your knowledge of him, made him very happy, would it?" A. It depends on the severity. I really could not care if he was happy or not happy." 151 Mr Blinkworth said that he had no knowledge of the plaintiff's plan to build a house on the Central Coast in the early part of his employment with Group 4 at News Limited. He said that the plaintiff did not tell him that Mr Chaloner had instructed him not to talk to anyone outside the building although he agreed that he was subject to the directions of Mr Chaloner on a day-to-day basis as his assistant. 152 Mr Blinkworth said that, had he been told by the plaintiff that he would not talk to him as he was not permitted to talk to anyone at Group 4 but only to Mr Chaloner he would find that to be "very odd" and "would want to see Mr Chaloner to find out" (in effect) what it was about. 153 Specifically, Mr Blinkworth denied that the plaintiff ever told him that Mr Chaloner insulted him in racist terms and that he, Mr Blinkworth, said that he would talk to Mr Deegan and sort it out for him. Mr Blinkworth also denied that he told the plaintiff that he had been reminded by Mr Chaloner that he (Mr Blinkworth) "had to do what Mr Chaloner wanted you to do because the contract is on a seven-day basis and if you didn't do what he wanted then you would lose the contract". He said that the plaintiff never told him that he was continuously working very long hours well beyond the eight-hour day, for which he was not being paid. In this respect he also denied telling the plaintiff that Mr Chaloner was a difficult customer and, if he wanted him to do the hours, for the sake of the contract he should "hang on and I will see what I can do". He was asked - "HIS HONOUR: Q. Certainly there were situations when there would be crises or situations arose requiring long hours but that's not what Mr Kennedy is talking about. He's talking about the continuous lengthy hours day in, day out? A. No, that never happened.

KENNEDY: Q. Well, you say not to your knowledge? A. Well, not to my knowledge, no.

Q. Did you ever enquire of Mr Naidu at any time as to what hours he was in fact working? A. The only issue that came up about hours was, we would monitor hours very closely on all sites because hours were monitored. That is the way that your profitability on the site. You have man hours or people hours and I do recall at News Limited the hours would sometimes blow out and the operational people would come up, whether it be pay role, come up and I would basically have to look at the hours reports and there was, from time to time, there were a couple of areas where Mr Naidu had worked some longer hours.

It was, I can't recall exactly what particular project or what was going on. As I said before, I think there was Super League and other projects. News Limited were always having different things on from time to time and there was a period there where I worked on the roster sheets that came through that he worked longer hours.

Q. Did you ever enquire of him as to what hours he was working? A. Wasn't my role.

Q. The answer is, you didn't, is that what you say? A. That's right.

Q. Did Mr Naidu ever complain to you about being required to work long hours? A. No.

Q. Not at any time? A. No." 154 Mr Blinkworth also denied, when the sex discrimination complaints were made, that he suggested to the plaintiff that he should tell Ms McDiarmid all about what had happened to him at Mr Chaloner's hands but should not mention that he had said anything to him (Mr Blinkworth). He said that the first time that he was aware of these matters was when the plaintiff told him about them as they were waiting outside Ms McDiarmid's office when the plaintiff had been called there to be interviewed. 155 Generally, Mr Blinkworth denied ever saying to the plaintiff anything to the effect that he should, in substance, put up with Mr Chaloner's misconduct and that he would see what he could do to improve things. He also denied that the plaintiff told him from time to time that he had been threatened by Mr Chaloner with dismissal unless he complied with his demands. 156 In relation to the tape-recorded conversation that occurred between the plaintiff and Mr Blinkworth, Mr Blinkworth conceded - as he had to - that the threat reported by the plaintiff as made by Mr Chaloner that "I can stop your pay any day" was certainly intimidating or, at least, an attempt at intimidation but explained that the plaintiff did not work for News Limited and, of course, could not be dismissed by Mr Chaloner. Mr Blinkworth said that he could not remember this part of the conversation but that he thought that in the context it was likely to have been understood by him (Mr Blinkworth) as a threat to have the plaintiff removed from the site which was apparently a common or, at least, not unusual occurrence and that Group 4, with its hundreds of sites, relocated its staff when these complaints were made by a customer. He said that he thought that Mr Chaloner was probably annoyed with the plaintiff because, in the circumstances (during a particular security crisis), the plaintiff had reported ill and was not going to report to work for some days. Mr Blinkworth summarized the position as, "so in the whole context of it I can see how it's fairly normal". This was the reason, Mr Blinkworth surmised, that he had not taken up the matter with Mr Chaloner. On the whole, I think that the terms of this conversation give some slight support to Mr Blinkworth's evidence that he had not been informed by the plaintiff of Mr Chaloner's racial vilification of him. 157 Of course, the crucial issue presented by Mr Blinkworth's evidence is the extent to which I should accept that the plaintiff made no complaints to him about Mr Chaloner's conduct. I should state, at the outset, that I was impressed by Mr Blinkworth's demeanour as a witness, despite occasions on which I thought it obvious that he was not being altogether forthcoming - where he stalled at being entirely candid. I have already pointed out that the plaintiff's inconsistent accounts - by omission in his initial written statement and explicitly in his statement to Ms Moss - cannot be reconciled with the truthfulness or, at least, the reliability of his evidence on this point. 158 I think that it is a fair inference, both from Mr Blinkworth's evidence as well as the other material to which I have referred, that Mr Chaloner was frequently, indeed typically, demanding and unreasonable in his communications with all staff - whether News or Group 4 employees - whom he regarded as under his direction or control, including Mr Blinkworth. I also think that he frequently attempted to verbally intimidate those employees, by way of raised voice and peremptory and contemptuous language. I accept that he used physical violence and implicit physical threats from time to time to vent his anger and intimidate employees under his authority and, perhaps, sub-contractors. I am unsure whether Mr Chaloner used the full range of verbal intimidation towards Mr Blinkowrth but I am satisfied that to a significant degree it was a feature, though perhaps only an occasional one, of his communications with Mr Blinkworth. Mr Blinkworth's unwillingness to acknowledge this conduct has led me to doubt somewhat the complete reliability of his denials about the plaintiff ever having complained to him about Mr Chaloner. 159 I have concluded that the plaintiff did indeed complain to him about Mr Chaloner being difficult, demanding and unreasonable - though not so frequently as the plaintiff asserts - and that he attempted to persuade the plaintiff to put up with it for the sake of continuing good relations. However, I accept Mr Blinkworth's evidence that the plaintiff did not complain to him, in terms, of any racial vilification. This is not to say that the plaintiff did not use general language describing offensiveness that did not convey the crucial information (but which the plaintiff now believes did so). I think that the probability is that Mr Blinkworth simply understood the plaintiff to be complaining about Mr Chaloner being a difficult customer. 160 So far as Mr Windham's statement is concerned, I have not had the opportunity of assessing his demeanour as a witness. The statement does not explicitly state that Mr Windham told Mr Blinkworth and Mr Miles that Mr Chaloner used racial insults towards the plaintiff. In the circumstances, I am not inclined to disbelieve Mr Blinkworth's evidence on the basis of this statement. 161 I have concluded that, more probably than not, the plaintiff did not complain to Mr Blinkworth about Mr Chaloner's behaviour in terms that would have conveyed that he was subjected to significant personal abuse and vilification by him, let alone at a level or intensity that might have led any reasonable person to apprehend any risk of psychological injury. Moreover, I am satisfied that Mr Blinkworth did not himself witness any misconduct towards the plaintiff. On the other hand, I am satisfied that Mr Blinkworth was well aware that Mr Chaloner was a bully and would or should have realized that he frequently used at least verbal intimidation in his relations with staff including, in particular, the plaintiff. 162 I should note that the plaintiff has pointed to the evidence of Ms McDiarmid as, in some respects, supporting the inference that Mr Blinkworth knew more than he admitted about Mr Chaloner's misbehaviour towards the plaintiff, having regard to his conduct at her interview with the plaintiff. It seems to me that this evidence is, in the circumstances, insufficiently clear or reliable for me to draw the inference contended for.

The evidence of Mr Paine 163 Mr Stephen Paine was called on behalf of News, with which company he held the position of the Properties and Administration Manager for over ten years, having been with News for nineteen years. He was immediately answerable to the Chief Operating Officer of News, effectively the second- in-charge of News' operations in Australia. He has held this position since 1994, in effect (leaving the Board out of account), being on the third rung from the top of executive management. He said that from 1992 and up to 1996 he knew both the plaintiff and Mr Chaloner very well. Mr Chaloner answered to him (Mr Paine) directly as his superior. He said that he observed the plaintiff in the performance of his duties during that time. He recalled that the plaintiff came to the News' premises as an employee security guard with Group 4 in about 1990 and progressed up through their ranks to senior guard then supervisor and finally to the Group 4 site security manager. At this point, about 1994, they had most contact. 164 Mr Paine said that from this time it would not be uncommon for him to see the plaintiff every day and sometimes often during the day. Mr Payne said that at different times he discussed matters relating to security directly with the plaintiff especially in relation to the electronic alarm system. He said that he thought that the plaintiff was well-presented, intelligent, highly skilled and that this developed over time. He said he thought that he was an excellent person to deal with and represented Group 4 very well. He saw the plaintiff in Mr Chaloner's presence on almost a daily basis. His conclusion was - and he described them as "my absolute feelings" - that they were not only close work colleagues but also friends. He said their relationship was very friendly and professional. He said they quite often talked about their families "but it was quite professional in a very relaxed way". 165 Mr Paine said, in relation to the plaintiff's early return to Australia following his visit to Fiji when his mother was ill, that he was surprised to see him back and that he asked him how his mother was. He said that the plaintiff responded, "Oh, she's sick but she's okay" but did not tell him why he returned early. Mr Paine said that he did not ask him why he had returned early. 166 Mr Paine said that the plaintiff had never made any comments to him about Mr Chaloner at all. In late 1996 he became aware of a meeting arranged between Ms McDiarmid on the one hand and Mr Blinkworth and the plaintiff on the other although he could not recall its detail. He said that he did not have any conversation with the plaintiff before this meeting nor did he have a conversation afterwards about how it went. He said, however, that he might have asked him how he was or something like that but not about what had occurred at the meeting. Mr Paine said that he was unaware of the subject matter of the meeting. In substance, Mr Payne said that he had dealings with Mr Blinkworth every three months or so. 167 Mr Paine recalled that Mr Kamaledine worked for News for a number of years as a draftsman but could recall no conversation with him about the plaintiff. He said that he only became aware of the complaints made by the plaintiff about Mr Chaloner's behaviour, in particular the racial slurs and abusive language, since the McDiarmid meeting. Mr Paine said that News had a very clear anti-discrimination policy for decades which, in particular, was in place whilst the plaintiff was employed there. He said that, had he become aware that Mr Chaloner had used racist slurs or made racist comments to the plaintiff, he would have been "extremely angry" and "moved to have the matter investigated and, whoever it is, whether Lance Chaloner or whoever, dismissed from our employment: it's just not acceptable". 168 Mr Paine gave further evidence about the development of policies concerned with harassment and vilification, including racial vilification, developed within News Limited. He said that those policies were not limited to the vilification of persons employed by News but "extends to anyone under the roof of News Limited". Mr Paine said that this kind of conduct is "totally unacceptable, and I can assure you from the senior management through it has been discussed long and hard over many years and it is very well supported". Staff, including staff at Mr Chaloner's level, were required to attend seminars conducted by the company in relation to these matters and that, indeed, he attended one of the courses with Mr Chaloner at some time in the mid-1990s. 169 Mr Paine considered that the plaintiff functioned extremely well during the period that he worked at News and, particularly, when News was the subject of vilification arising out of the Super League controversy during 1994-1996. Mr Paine said that he observed that there were some difficulties between the plaintiff and Group 4 about which the plaintiff spoke to him. One of these issues related to a proposed workplace agreement which he refused to sign. He said that, so far as he observed, the plaintiff's dealings with other personnel at the premises he "reacted in a very friendly manner" and would often counsel them about their workplace issues. I have already mentioned Mr Paine's general assessment of the plaintiff's capacity. He added that, given his aptitude, with appropriate training and support, he thought that the plaintiff would have been able to undertake, for example, Mr Chaloner's duties. He said that he had some problems with time management, in that "quite often it would taken him a lot longer than you would expect for him to carry out a task" and also (as I understand Mr Paine's evidence) he tended to be rather more friendly than directive with staff under him than was consistent with efficiency. His recollection of the plaintiff's working hours was that he would often come in later in the morning after an afternoon and evening shift, although he would rarely start early and finish late. His view was that the plaintiff was "working reasonable hours" and disputed that he would work longer than reasonable hours, which Mr Paine assessed at perhaps nine and a half hours a day and probably less than that on average. He might rarely work longer than nine and a half hours. 170 Mr Paine said that he did not see Mr Chaloner behave towards the plaintiff in an aggressive, as distinct from demanding, way and never at any time heard him raise his voice. He said that had Mr Chaloner done so in his presence he would certainly have taken action. The substance of his evidence was that he strongly disapproved of any bullying and said that his role would have been to remove any bully from the workplace, adding, "there was no question about that". He said that he was not present at any time when Mr Chaloner made unreasonable demands on the plaintiff or acted towards him in an intimidating way. 171 Mr Paine said that such was his relationship with Mr Blinkworth and, indeed, other executives of Group 4, including the Managing Director that, had there been an issue about Mr Chaloner's conduct, he would have expected them to have raised the matter with him. He said they had daily access to him and their relationship was cordial, so that there was no reason why, if they had a problem, it could not have been discussed with him. He said that workplace issues were commonly discussed. 172 Mr Paine, in cross-examination, conceded that he knew that Ms McDiarmid was conducting an enquiry into allegations made by women staff about sexual harassment by Mr Chaloner and that he told the plaintiff that Ms McDiarmid wanted to see him about those allegations. He said that he was not aware whether the plaintiff had anything relevant to say but he acted on Ms McDiarmid's request. He said that he assumed that the plaintiff was being asked to speak to Ms McDiarmid about the sexual harassment claims. Mr Paine described as "absolute nonsense" the suggestion that he spoke with the plaintiff just before he went in to see Ms McDiarmid suggesting to him that he should not remember anything that he may have observed about Mr Chaloner's behaviour towards the female complainants. He said, in effect, that had he known of the matters disclosed, he "would not have put up with it", commenting that it was "outrageous" conduct. He said that he was "absolutely direct" that, after the plaintiff came out of the meeting he saw him in his office and asked him how the meeting went and obtained the assurance that he did not say anything. He said that he had no fear that his own position was under threat by virtue of the discrimination allegations. 173 Mr Paine said that Mr Kamaledine never raised with him going to do some architectural work for Mr Chaloner on his property at Kenthurst. He said that Mr Kamaledine was permitted to do work part time in the office after hours and use News' equipment for the design and development of plans for a number of people around the building but he did not have any specific recollection of Mr Kamaledine seeking permission in respect of Mr Chaloner although it would not surprise him if he had done so. 174 Mr Paine said that it was his understanding from what both the plaintiff and Mr Chaloner said to him, that they were friends: they spoke about their family gatherings, there was a relationship between the families and they used to go out to dinner together. He said these kinds of things were disclosed during informal chats. He said that on one occasion he recalled visiting Mr Chaloner at his house on his way back from a trip probably, he thought, within the last year that Mr Chaloner worked at News, perhaps late 1995 or 1996. 175 He said that the plaintiff, in 1995 and 1996, was often absent from News' premises but this was because he was involved in both the security guarding services and operating the electronic alarm systems which would take him to the Cumberland, Gosford and Parramatta offices and to a number of the suburban newspaper offices around Sydney. Mr Paine also said that although he knew about half of the dozen or so Group 4 security officers at the News' site at Surry Hills, he did not hear any discussion by them about Mr Chaloner's conduct towards the plaintiff. He had seen Mr Chaloner and the plaintiff in the corridor of the building, I take it frequently, and had never heard Mr Chaloner using racist language towards the plaintiff nor did he ever hear him raise his voice to him. He unqualifiedly denied ever having been informed by Mr Kamaledine that he had heard Mr Chaloner refer to the plaintiff as "a black bastard" and "a black cunt". He said that he had many discussions over the years with Mr Kamaledine about matters associated with work but nothing of this kind was said to him. To the suggestion that Mr Kamaledine indeed told him of this matter, he answered - "It was definitely not. That it is the sort of thing that, first of all, goes against my principles, it goes against the company's principles and I consider that it was an extremely important issue that I would have followed up immediately."

He denied ignoring any such information. Mr Paine pointed out that the employees in his area of responsibility comprised a racial mix including Iraqis, Lebanese, a Maori and an Indian and added, "I take particular exception to any thought that I would just let something like that go through. I am sure I would not." It was put to him that it would have been too much trouble for him to do anything about it and he therefore declined to take any action. Mr Paine answered, "I believe there is never too much trouble when it comes to people being harassed or being vilified under any circumstances." Mr Paine commented that, indeed, not to have taken the matter further had he been given the information, would have been to risk his job. 176 Mr Paine's view of the nature of the relationship between Mr Chaloner and the plaintiff, in terms of their work responsibilities, was that Mr Chaloner was managing the contracts for the services Group 4 was providing to News and would certainly give directions about the News' work requirements but that Group 4 was responsible for formulating and carrying out instructions that fulfilled those requirements. He said that the plaintiff was never Mr Chaloner's assistant and could not be since the plaintiff worked for Group 4 and Chaloner was an employee of News. In this regard, I think that Mr Paine's view was more descriptive of and influenced by the contractual relationship between News and Group 4 than the demands imposed by Mr Chaloner on the one hand and, on the other, the plaintiff's and, for that matter, Mr Blinkworth's response to them. Mr Paine said that it was important for Mr Chaloner not to manage the particular way in which contractors provided security and fire services for News. Not only would it be (as I understand his evidence) inefficient to employ contractors and then manage them but insurance issues might put News at a severe risk if this occurred. On the other hand, he conceded (as appears to be commonsense) that over a lengthy period of joint responsibilities of this kind a closer and more detailed form of management of the contract would be likely to develop. 177 The overwhelming evidence about Mr Chaloner's manner of operating and managing his relations with sub-contractors is consistent with the plaintiff's description of his position (quite apart from the question of abuse) as subordinate to Mr Chaloner. Mr Paine said that he met with Mr Blinkworth regularly and was told by him that Mr Chaloner was demanding, indeed, very demanding, though he never said that he was either unreasonable or intimidating. If Mr Paine knew Mr Chaloner as well as he said he did, I have no doubt that he would have realized that, one way or another, he would have exercised day-to-day control over the plaintiff's activities. In short, whatever the formal requirements of the contract between News and Group 4 might have been, the plaintiff was controlled and supervised and subject to the day-to-day directions of Mr Chaloner as though he were his assistant and a News employee. Moreover, this was known to be the real situation both by Group 4, through Mr Blinkworth, and News, through Mr Paine. 178 I have very carefully re-read the evidence of both Mr Kamaledine and Mr Paine on the specific question whether Mr Kamaledine actually informed Mr Paine about any racist slurs made by Mr Chaloner towards the plaintiff. At the time they gave evidence, I thought both these witnesses were impressive. Each was, considered alone, quite convincing. It is important to bear in mind that both were giving evidence about matters which occurred many years ago and each, in a different way, has an interest in giving the evidence that they have. Mr Kamaledine had friendly feelings for the plaintiff and knew that he ought to have said something to Mr Chaloner's superior. Moreover, he had himself been abused by Mr Chaloner calling him a "camel driver", in a derogatory reference to his ethnic origins. Mr Chaloner was Mr Paine's subordinate and omitting to take appropriate action when a report was made to him as claimed by Mr Kamaledine could be regarded as a serious failure in management. 179 This is not a matter which, I think, can be fairly determined by demeanour. Both of these witnesses gave their evidence in a forthright and apparently sincere way. I think that both witnesses were giving evidence they believed to be truthful. At the same time, the relevant event occurred about ten years ago and a considerable period elapsed before each was probably asked to recall what happened. Memory over such a period is fraught with the risk of reconstruction. In this respect, it must have been a big step for Mr Kamaledine to take to report Mr Chaloner's conduct to an executive of Mr Paine's seniority. His memory in this respect is most unlikely to suffer from reconstruction. On the other hand, Mr Paine would be, on the face of it, unlikely to have forgotten about a report to the effect that his immediate subordinate had racially abused a senior officer of an on-site sub-contractor. 180 At the same time, I have concluded that Mr Chaloner's racial and personal abuse of the plaintiff was indeed habitual. It was noticed, to a greater or lesser extent, by other staff whose evidence corroborates to that degree the evidence of the plaintiff. In light of Mr Paine's asserted familiarity with Mr Chaloner and his form of communication with the plaintiff, it is somewhat difficult to accept without qualification his assertion that he was completely unaware of the former's frequent if not characteristic mode of addressing him or the racist attitudes that underlay it. Mr Chaloner's manner was frequently, and probably habitually, peremptory and intimidatory. If Mr Paine did not notice this, I would conclude either that Mr Chaloner was adept at concealing this trait or Mr Paine was not alert to this kind of behaviour - or, more probably, a combination of both of these explanations. 181 It is possible that Mr Paine decided to wait until the plaintiff complained before he took action following Mr Kamaledine's report, that no complaint being forthcoming from the victim he decided to take no action and that he has over the ensuing years come to believe that no complaint was ever made to him. In light of his emphatic denial that Mr Kamaledine told him anything such a possibility could scarcely be explored. This speculation is of little utility. I must deal with the evidence as it has been given. As I have said, I am not conducting a commission of inquiry and some matters must remain unknown. 182 I have found the conflict between the evidence of Mr Paine and Mr Kanaledine difficult to resolve. With some hesitation, I have come to the conclusion that, on the whole, Mr Kamaledine's evidence should be accepted as more probably than not the truth of the matter. I am conscious that, in coming to this conclusion, I may be doing Mr Paine a considerable injustice. It is important for this reason that I should point out that I am concluding no more than that the probabilities seem to me to favour Mr Kamaledine's account rather than Mr Paine's and that I have certainly not come to any positive conclusion that reflects on Mr Paine's honesty. 183 As I have suggested, it is very likely that Mr Chaloner was adept at concealing any inappropriate conduct from Mr Paine. Mr Chaloner had suggested often that Mr Paine was not satisfied with the plaintiff's work and the plaintiff would have been anxious to present himself as working well with him. It seems also that Mr Paine was unaware not only of the way in which Mr Chaloner treated the plaintiff but also of the harassment inflicted by Mr Chaloner on his secretarial staff. In the result, Mr Paine's evidence has not led me to qualify my conclusions about the reliability of the plaintiff's evidence either about Mr Chaloner's misconduct or its effect upon him, although I would accept that the plaintiff quite often might well not give the appearance to the casual observer of being especially unhappy. THE QUESTION OF LIABILITY

The effect of the Racial Discrimination Act 1975 184 Having regard to the view that I have taken on the liability at common law of the defendants, I have not found it necessary to consider the effect of this legislation.

Liability at common law 185 It is not controversial that, in general, there is no liability in negligence for causing distress, alarm, anxiety or despondency without any resulting recognized psychiatric illness: see eg, Tame v NSW (2002) 211 CLR 317 per Gleeson CJ at [7], where his Honour added - "[18] I agree with Gummow and Kirby JJ that the common law of Australia should not, and does not, limit liability for damages for psychiatric injury to cases where the injury is caused by a sudden shock, or to cases where a plaintiff has directly perceived a distressing phenomenon or its immediate aftermath. It does not follow, however, that such factual considerations are never relevant to the question whether it is reasonable to require one person to have in contemplation injury of the kind that has been suffered by another and to take reasonable care to guard against such injury. In particular, they may be relevant to the nature of the relationship between plaintiff and defendant, and to the making of a judgment as to whether the relationship is such as to import such a requirement."

The test of foreseeability must be evaluated by reference to the effect that the impugned conduct would likely have on a person of "normal fortitude" unless a particular fragility is known to the defendant: Gleeson CJ at [16], Gaudron J at [62], McHugh J at [95], although Gummow and Kirby JJ pointed out that, "in some circumstances the risk of recognizable psychiatric illness to a person who falls outside the notion of 'normal fortitude' is nonetheless not far-fetched or fanciful", in the sense enunciated in Wyong Shire Council v Shirt (1980) 146 CLR 40 at 48. 186 The acts of Mr Chaloner were, of course, not mere negligence. They were deliberate and intended to demean, offend and injure. Because no particular occasion could be said to have caused the plaintiff's ultimate psychological illness, the defendants' argue that the line of reasoning expressed in Janvier v Sweeney [1919] 2 KB 316 does not apply. It strikes me as extraordinary that, the intention of Mr Chaloner being as I have characterised it, he would not be liable for the actual injury he inflicted on the plaintiff, though he had not actually thought that what he was doing might do more than cause temporary, though acute and painful distress. In fact, I consider that Mr Chaloner was indifferent to the consequences of his malice and was content to cause as much distress as his actions were capable of inflicting, subject, I suppose, to the desirability of the plaintiff being able to continue to work in subjection to him. In this sense, this case is markedly different from the situation under consideration in Tame. If Janvier v Sweeney (supra) be rightly decided - and there is no reason, I think, to suppose otherwise - it appears to follow that the defendants are both liable for such of Mr Chaloner's misbehaviour as was inflicted in the course of his employment, a matter to which I come in due course. As it happens, however, it seems to me that the defendants are liable in negligence - and Group 4 in contract - for the plaintiff's psychological injury at Mr Chaloner's hands and I have not, therefore, found it necessary to consider further the application of this line of authority to the present case. 187 I have concluded, for reasons which are stated later in this judgment, that the plaintiff, during the course of his employment with Group 4 sustained a major psychiatric injury of major depression and also, I think, post-traumatic stress disorder, as a result of the manner in which he was treated by Mr Chaloner. Allowing for some degree of exaggeration (of which the plaintiff may well be unaware) I have concluded also that the conduct of Mr Chaloner as described by him was so brutal, demeaning and unrelenting that it was reasonably foreseeable that, if continued for a significant period of time, certainly the period of the plaintiff's relationship with Mr Chaloner, it would be likely to cause significant, recognizable psychiatric injury. 188 It is plain that Group 4, as the plaintiff's employer, owed him a duty of care to exercise reasonable care for his safety, including the provision of a safe place of work and a safe system of work. It is not controversial that this duty was non-delegable: TNT Australia Pty Limited v Christie & 2 ors; [2003] NSWCA 47. That case is also authority for the conclusion that, in the circumstances, News also owed the plaintiff a duty of care to ensure his safety at work. 189 At the centre of the case against Group 4 is the question whether it knew or ought to have known of the way in which the plaintiff was being treated. I have already stated why the probabilities, in my view, favour acceptance of Mr Blinkworth's evidence as against that of the plaintiff on this point. The lack of any sensible reason for inaction on Mr Blinkworth's part gives support to my conclusion that the most probable explanation is that he was simply unaware of the true nature of Mr Chaloner's conduct towards the plaintiff. I do not mean to suggest that the unreasonable demands (about which I think it likely that the plaintiff did complain from time to time to Mr Blinkworth) made upon the plaintiff by Mr Chaloner are irrelevant. They are plainly part and parcel of the control that he exercised over the plaintiff which, I think, substantially increased the plaintiff's sense of powerlessness and thus contributed to his ultimate illness. At the same time, the evidence (as I have already indicated) does not establish that Mr Blinkworth was aware of more than isolated incidents of excessive demands and I do not consider that his knowledge of these matters would or should have led him to suspect that Mr Chaloner was behaving in such a way as could or might lead to injuring the plaintiff, subject to a qualification to which I will come shortly. 190 General complaints that Mr Chaloner was a demanding and unreasonable person to work with would not suggest the reasonable possibility of an ensuing psychiatric injury, though of course this must be a matter of degree. It seems to me that some information would need to be conveyed suggestive of serious distress as distinct, for example, from indignation or irritation, that is to say, some indication that the plaintiff was finding it difficult to cope with Mr Chaloner's alleged misconduct. Complaints about unreasonable or demanding behaviour by superiors must be commonplace and, perhaps, an everyday occurrence. In the normal course it could not be reasonably foreseen that such behaviour would or might cause serious illness. I am satisfied that, in this case, Mr Chaloner's conduct was so extreme as to have made it reasonably foreseeable that the plaintiff would suffer such illness but general complaints about what amounted to little more than unreasonable demands would not, I think, alert any reasonable employer to the risk to the employee of suffering a mental illness as a result. Even a report of occasional racist remarks, though offensive and completely wrongful, would not, I think, alert any reasonable employer to such a risk. 191 On the whole, I am satisfied that Mr Blinkworth knew, or should have known, from his own experience of Mr Chaloner's manner, that he would in all likelihood, be demanding and unreasonable towards the plaintiff in connection with his work as Mr Chaloner's assistant and that his manner would almost always be intimidating whenever the plaintiff did not satisfy his requirements. Whatever the effect of the Anti-Discrimination Act 1977 or similar legislation, I do not doubt that an employer has a duty by virtue of an implied term in the contract of employment to protect all employees from racial or personal vilification. Racial or personal vilification is a direct attack upon the personal integrity of the employee and an employer is obliged, by virtue of the contract of employment, to take reasonable steps to prevent it from being inflicted during the course of employment - as by taking action against the offending employee or moving the offended employee elsewhere. This is necessarily implicit in the duty to provide a safe place and a safe system of work. At all events, accepting as I do that Group 4 had in place at all material times a policy prohibiting personal vilification and systems designed to deal with its occurrence, such arrangements were necessarily a part of Group 4's contract of employment with the plaintiff. 192 It is clear, however, that the obligation cannot be an absolute one. It is plainly not only impossible but offensively invasive for an employer so to supervise the conduct of its employees as to make itself aware, one way or another, of all possibly offensive conduct. Inevitably, the question must be (whether the complaint is that of breach of contract or negligence), whether in the circumstances the employer ought to have known of the misconduct in question. I should also mention at this point that even an occasional complaint, providing it raises serious misconduct, might well trigger liability for ensuing injury caused by continuing but not complained of conduct. The reason for this is twofold. Firstly, a failure to act on such a complaint might well induce an employee to think that making complaints of this kind is pointless and therefore to continue to suffer from misconduct. Second, it is but commonsense that misconduct of this kind, if unchecked, is very likely to continue and, quite possibly, increase in its offensiveness as the perpetrator becomes more confident either that the victim will remain silent or that the victim's superiors will ignore it. 193 Accordingly, even one complaint of serious misconduct should initiate in any employer acting reasonably an enquiry both of the person against whom the allegation is made and of the affected subordinate about the truth of the allegation and the extent of the misconduct. That process should also involve an enquiry of the employee about that employee's response to and ability to cope with the conduct of which he or she has complained. Of course, in every case this will be a matter of fact and degree but the appropriate response of the employer must be gauged against the duty to take seriously its obligations to provide a safe place of work. 194 On 3 April 1997 the Board of Tempo Services Limited issued a document entitled "Employment opportunities, discrimination and harassment policy". It is, I think, common ground that the substance of this document reflected the published policy of Group 4 at the time of the plaintiff's employment. That statement states that the company - "does not condone direct or indirect harassment of any person within the workplace. This includes but is not limited to harassment on the ground of sex, physical, mental or oral abuse."

The second sentence is awkward to the point of illiteracy but its sense is clear enough and to my mind undoubtedly covers the position of the plaintiff and the harassment to which he was subjected by Mr Chaloner. The policy contains the following, which seems to me of significance in the present context - "If you, as an employee, believe you or any other employee is the subject of treatment which is not in keeping with the above policy you MUST contact either of the following staff direct…" (Emphasis added.) 195 Although this policy required the plaintiff himself to report the harassment to which he was subjected, it also required those of his co-workers who were aware of Mr Chaloner's misconduct to report it. It seems to me that I should infer that this did not happen because it was not made sufficiently clear to all employees that they had a duty not only in relation to acts done to them but also acts done to others, even if the victim was a superior. The fact that the relevant employees at this time were comparatively young did not excuse the company from ensuring that they understood their duty in this respect since it is precisely those workers who are likely to be the subject of, or to witness, acts of harassment. 196 In the plaintiff's case, having regard to the evidence of the plaintiff's co-workers, it seems to me that the only reasonable inference to draw is that the company had not paid sufficient attention to the practical consequences of harassment and bullying in the workplace, in particular the likelihood that it would be associated by implicit or explicit threats that complaints would not be listened to or that a complainant's employment might be at risk if he or she took action. The need for the policy to emphasise the mode by which employees could confidently make fair complaints without being at risk and that it did not matter if the victim of the misconduct was a superior seem to me to be obvious. This was a matter peculiarly within the knowledge of Group 4 and, there being no evidence to contradict the otherwise natural inference to which I have referred (that the policy was deficient in this regard both in its expression and application), my view of its probability is substantially strengthened. 197 Accordingly, it seems to me that the knowledge of the Group 4 employees at the News site as to the manner in which the plaintiff was treated by Mr Chaloner should be attributed to the company, either directly or constructively. Group 4 should have been aware sufficiently of the nature of Mr Chaloner's exercise of control and relationship with the plaintiff to have alerted it to the need to investigate that conduct and, had this been done, it would have discovered its serious and potentially dangerous extent. 198 Applying the reasoning in Christie (supra), it seems to me that, by entrusting the plaintiff to the close, continuous and direct supervision of Mr Chaloner, Group 4 must be taken to have accepted responsibility for the manner in which Mr Chaloner conducted himself in that role. In effect, and for all practical purposes, Mr Chaloner was the agent jointly of News and Group 4 for the purpose of managing the on-site aspects of the security contract between the two companies and, hence, of directing the plaintiff as to the performance of his duties and Group 4 is liable for the wrongful manner in which Mr Chaloner undertook that supervision. As the plaintiff's putative superior, Mr Chaloner was in a senior position. Mr Blinkworth accepted that he was, as it were, his opposite number. As Group 4's agent, I can see no reason for not attributing to Group 4 Mr Chaloner's own knowledge of his misconduct, at least as far as his work-connected wrongdoing is concerned, quite apart, from attributing to Group 4 the knowledge of its employees at the site. 199 It seems to me that what I have said about racial and personal vilification applies also, as should be obvious, to any deliberately demeaning conduct. For example, Mr Chaloner's habit of concealing files and ridiculing the plaintiff for not finding them or his other aggressive and physically threatening behaviour.

200 Intimidatory conduct is conduct that induces fear, either of physical or verbal abuse, in another. Permitting intimidatory conduct to be inflicted on employees is a breach, as it seems to me, of an implicit term of every contract of employment that employees are not to be placed in fear of insult or physical harm. A fortiori, permitting a course of intimidation in the workplace is a substantial breach and will sound in damages. Whether continuous intimidation in the form of verbal abuse or the threat of verbal abuse (not involving racist vilification) is foreseeably likely to cause a recognizable psychological condition is not easy to determine. Obviously much will depend upon its character and frequency. It seems to me that the starting point is that Mr Blinkworth knew or ought to have known from his own relationship with Mr Chaloner that the latter was likely to use intimidation as one of his techniques of management and that the plaintiff would be the butt of this behaviour. It follows that Mr Blinkworth had a responsibility, under the plaintiff's contract of employment, to make reasonable enquiries of the plaintiff and other co-workers at the site about its nature and extent. I am satisfied that he did not do so. Had he done so, I think that, more probably than not, the true extent of Mr Chaloner's misbehaviour would have been mostly, if not entirely, exposed. Permitting such conduct to continue for a significant period carried with it the reasonably foreseeable risk of causing a psychological illness of the kind ultimately suffered. This line of reasoning renders Group 4 liable for that consequence under both contract and negligence. 201 I consider below the issue of Group 4's vicarious liability for the conduct of Mr Chaloner. It seems to me that this liability may be present even if the management of Group 4 was unaware of Mr Chaloner's misconduct and even if it cannot be concluded that it ought to have been so aware. The basis for such liability is dependant on whether the misconduct was committed in the course of the wrongdoer's employment, rather than what management knew or ought to have known.

202 As I have already mentioned in fairness to News, it has conceded that Mr Chaloner's conduct was indefensibly wrong. However, in light of my conclusions concerning Mr Paine's probable knowledge of that conduct, I do not accept the submission that, as soon as Mr Chaloner's superiors became aware of it, he was dismissed. Having regard to the nature of Mr Kamaledine's information, if appropriate inquiries had been instituted, News would have become aware at a high level of management both of the extent of Mr Chaloner's misconduct (with the likely exception of the sexual harassment) and its potential impact on the plaintiff's mental well-being.

203 In his helpful and thorough submissions, Mr Torrington of counsel for News contends that it is not liable for Mr Chaloner's misconduct. The submissions reflect an analysis of that behaviour, dividing it into four categories: threats of violence, explicit and implicit; work at Mr Chaloner's house and other "external" demands; personal and racial vilification and the sexual assaults. As I think should be obvious from my account of the evidence, the usefulness of this analysis should not deflect attention from the reality that all these aspects of Mr Chaloner's conduct, including his insistence upon unreasonably lengthy hours, were part and parcel of the process of exercising control over and demeaning the plaintiff. Some elements, such as labour at his house and sexual behaviour, related to Mr Chaloner's private concerns. However, although the other elements of his conduct no doubt fed his own ego and sense of importance and power (that is, were personally gratifying) they were also ways by which he controlled the plaintiff in the actual performance of his employment. They had the effect of ensuring his almost unprotesting compliance with Mr Chaloner directions as to how those duties should be performed and induced him to work far longer hours than he otherwise would have. As I have said, I do not think it is possible, let alone sensible, to divide up the contribution that each particular aspect of Mr Chaloner's impositions had on the plaintiff's psychiatric condition. With the possible exception of the sexual assault, all Mr Chaloner's requirements were inextricably intertwined in what was essentially the same course of conduct, which was to a very significant extent inextricably connected with the performance by the plaintiff of his work. 204 Although the sexual misconduct occurred in the work context, it was so far removed from any work-related responsibilities that I am unable to hold that either News or Group 4 is vicariously liable for it. However, I am quite satisfied that the plaintiff would still have suffered from the psychological injury that was ultimately demonstrated, even if this particular disgraceful behaviour had not occurred. 205 I have already said that I consider that the ultimate illness suffered by the plaintiff was caused by the misconduct, considered as a whole, of Mr Chaloner towards him. Furthermore, I am satisfied that it was reasonably foreseeable that such an illness might well result from the infliction of that conduct upon the plaintiff, whether or not Mr Chaloner was aware, or cared, whether this might be the result. I have no doubt that Mr Chaloner realised that his behaviour would have caused some injury to the plaintiff. If he turned his mind to the risk of inflicting serious injury to the plaintiff, he was, at least, indifferent to the risk. 206 In substance, the injury suffered by the plaintiff was inflicted by Mr Chaloner as much in the course of his employment by News as that inflicted by Mr Bugden on Mr Rogers, leading to Canterbury Bankstown Rugby League Football Club Limited v Rogers; Bugden v Rogers (unreported, NSWCA 23 November 1993; BC 9302234) or the attack inflicted by Mr Wilson on Mr Starks giving rise to Starks v R S M Security Pty Ltd & Ors [2004] NSWCA 351. 207 In Bugden, the judges of the Court of Appeal were divided upon the question of exemplary damages but agreed upon the other issues in the appeal, in particular the responsibility of the Club for the unlawful deliberate injury inflicted by Mr Bugden on Mr Rogers. Mr Bugden was an employee of the Club, a limited liability company with which he had a written contract. That contract included the requirement that he would play the game in a sportsmanlike manner and in accordance with its rules. Those rules provided that a player is guilty of misconduct if he deliberately strikes another player unnecessarily and viciously attacks the head of an opponent when effecting a tackle, deliberately breaks the laws of the game or behaves in any way contrary to the true spirit of the game. It was clearly established, both by the rules and other evidence, that there was a real and important distinction between a legitimate tackle on the one hand and, on the other, a illegitimate tackle or other conduct involving the use of force. The trial judge held that, although the use of some force was authorised in Bugden's tackle of Rogers, Bugden did so in a manner which was not authorised but was "closely connected with what he was authorised to do…and that his action may properly be regarded as an improper mode of doing what he was authorised to do". The trial judge observed that such tackling is not an infrequent occurrence in games of first grade rugby league and, indeed, it is inevitable that from time to time the rules would be broken whether intentionally or unintentionally. The trial judge thought it important to note that "Bugden's action cannot properly be described as an action just for his own purposes or to give satisfaction to himself or to get revenge for himself". It was, "misguidedly but nonetheless inextricably associated with an intention" to perform his obligations as a player and to achieve an advantage for his employer. Independently of this intention, his unauthorised act "had the consequence necessarily of aiding the Club as any proper and lawful but forceful tackle might". 208 It is clear that there is no bright line which easily separates forbidden conduct for which an employer is not liable as being quite outside the scope of the employee's employment (to use the language of Giles AJA BC 9302234 at 12) and an act that is not so quite outside the employment. The difficulty in defining the line is clear from the following passage in the judgment of Mahoney JA (BC 9302234 at 12) - "An employer is vicariously liable for damage for which his employee is liable if what the employee has done was within the scope of his employment. He is ordinarily liable if the employee does in an illegitimate way what he was employed to do in a legitimate way. But the employer will not be liable if what the employee has done is so far beyond what he was employed to do that liability should not be imposed."

If I may be permitted the observation, with unfeigned respect, it appears to me that there is an element of circularity in the last sentence of this passage. 209 In the present case, the substance of Mr Chaloner's duties in relation to the plaintiff was to direct him in the manner in which the security services supplied by Group 4 were to be undertaken at the relevant premises. 210 Whatever the formal relationship between the plaintiff as an employee of Group 4 and Mr Chaloner as an employee of News might have been or might have been thought to have been, there can be no doubt that it was known to and agreed by both News (through Mr Paine) and Group 4 (through Mr Blinkworth) that Mr Chaloner would be likely to and, indeed, did directly manage the plaintiff's work activities in every relevant sense as though the plaintiff was answerable to Mr Chaloner for their due performance and, moreover, given Mr Chaloner's personality, this would be likely to involve unreasonable and possibly excessive demands on the plaintiff and his staff. It follows that these demands would be likely to be obeyed if the plaintiff was, or felt that he was, completely under Mr Chaloner's control in the performance of his work. 211 There can be a difference in substance and not merely of degree, between an order however peremptorily phrased, and an order accompanied by demeaning, insulting or racist language but it is notorious in human affairs that the latter not infrequently accompanies the former. Criticisms of an employee for failing to fulfil an assigned task adequately may range from the constructive to the destructive. A destructive criticism may well be couched in language of elaborate politeness and yet be calculated to demean and humiliate the employee in question. To add personal insult or racist colour to such language is no doubt a further and objectively prohibited act but to say that one is so different from the other as to render the latter outside the scope of employment seems to me to be unreal. 212 In Gordon v Tamworth Jockey Club Inc [2003] NSWCA 82, Ms Gordon was assaulted without provocation when she was sitting with friends having a quiet drink at the back of the kitchen on the Club's premises by a person employed by the Club as a cleaner who was drunk at the time. Just before the assault, he had thrown a beer bottle, apparently at a possum, which had then smashed near Ms Gordon. This was seen by an executive member of the Club who told the employee that he was drunk and an idiot but gave no instruction to him either to amend his behaviour or to leave. The apparently careless conduct of the Club's executive member could not change the obviously entirely extraneous character of the cleaner's assault which plainly had no connection at all with anything that he was employed to do. 213 In this State the issue has been most recently considered by the Court of Appeal in Starks v R S M Security Pty Limited & Ors [2004] NSWCA 351. In that case, Mr Starks was head-butted by a security guard whose request that he leave Mr Starks had disputed. As a result of the incident, Mr Starks suffered an injury and brought proceedings against the guard, the guard's employer, the owner/occupier of the hotel and the hotel's licensee for damages. The trial judge held the guard to be liable but rejected the claims against the other parties. Mr Starks sought leave to appeal against the adverse verdicts. The verdict against the guard followed from the trial judge's conclusion that he had assaulted Mr Starks without any legitimate excuse. Of course, the crucial question was whether, in doing so, the guard was acting within the scope of his employment. Although the guard had directed Mr Starks to leave the premises and it was undoubtedly within the scope of his employment for example, to have attempted to escort him out or to warn him that continued disputation or disobedience with the direction could result in the use of force, the learned trial judge held that to suddenly head-butt Mr Starks in this situation was completely unreasonable and unnecessary, as well, of course, being criminal. The learned trial judge found that the hotel could not have foreseen that the guard would act in the way that he did. After a review of the authorities, Beasley JA (with whom the other members of the bench agreed) said - "Although Mr Wilson's action in head-butting Mr Starks was unreasonable, uncalled for, and not a usual mode for a security officer to use to persuade a customer to leave hotel premises, the fact is Mr Wilson acted in that way in the course of seeking to have Mr Starks leave the premises. In my opinion, his action was so directly connected with his authorised acts that this case is one that falls on that side of the line that makes the employer vicariously liable." 214 The mere recitation of examples, of course, does not comprise a line of authority; each case must depend upon its own facts. This is especially so where the issue is very much one of degree. In this case so much of the threats, demeaning behaviour and racial vilification was so intimately connected with the exercise of his authority by Mr Chaloner in respect of the plaintiff and so closely associated with his day-to-day direction and control of the plaintiff's activities that, although the conduct was not authorised and, indeed, was prohibited by his employer, News is vicariously liable for it. As I have already said, some of the complained of conduct - the work at Mr Chaloner's home, the insults outside working hours and unconnected with work but related to the plaintiff's proposed house-building and restaurant business and the sexual assaults - cannot as a practical matter be separated out (as contributing causes to the plaintiff's illness) of the unremitting misconduct visited on the plaintiff whilst at work and performing his duties at the behest of Mr Chaloner. At all events, realistically speaking, had these extraneous events not occurred I would conclude that more probably than not the other conduct would have had the same or similar injurious consequence for the plaintiff. In other words, the workplace connected abuse conducted in the course of his employment by Mr Chaloner was a substantial cause of the plaintiff's psychological illness, whatever additional contribution was made by the other misconduct. 215 In New South Wales v Lepore & Ors [2003] HCA 4; 2003 112 CLR 511, Mr Lepore brought an action in the District Court of New South Wales claiming damages for personal injury allegedly suffered as a result of assaults committed upon him while he was a pupil at a public school by a teacher at that school. It was alleged that the assaults occurred as a response to supposed misbehaviour and the imposition of corporal punishment for it. On a number of occasions, Mr Lepore (then aged seven) after being accused of misbehaviour was sent to a storeroom, told to remove his clothing, smacked and then touched indecently. On some occasions, other boys would be present also ostensibly being punished. The issue was whether, there being no allegations of any fault on the part of the school authority and its systems or procedures, its appointment and supervision of staff, its arrangements for responding to complaints or warnings, or any other matter which might have given rise to a claim that the authority itself was guilty of a want of care, the acts of the teacher made the authority liable. In the High Court of Australia, the argument was raised - and leave given - to argue that the school authority was vicariously liable for the acts of the teacher. Gleeson CJ commenced his discussion (212 CLR at 535 ff) by contrasting a tort committed within the scope of the employee's employment on the one hand and conduct that could be described as a "frolic of his own", referring to the judgment of Diplock LJ in Morris v C W Martin & Sons Limited [1966] 1 QB 716 at 733-734. However, as Gleeson CJ observed, the latter phrase "may be of limited assistance in resolving difficult borderline cases" [42]. His Honour went on to say - "The best known formulation of the test to be applied is that in Salmond, Law of Torts in the first edition in 1907 (at 83) and in later editions… an employer is liable even for unauthorised acts if they are so connected with authorised acts that they be regarded as modes - although improper modes - of doing them, but the employer is not responsible if the unauthorised and wrongful act is not so connected with the authorised act as to be a mode of doing it, but is an independent act."

As Lord Wilberforce explained in Kooragang Investments Pty Limited v Richardson & Wrench Limited [1982] AC 462 at 472, to hold an employer liable for negligent acts of an employee is usually uncontroversial; negligence involves performing an allotted task carelessly rather than carefully. Intentional and criminal wrongdoing, engaged in solely for the benefit of the employee, represents a more difficult problem. Even so, employers may be vicariously liable for such wrongdoing, even in cases where the wrongdoing constitutes a flagrant breach of the employment obligations. 216 Gleeson CJ referred to the explanation given by Dixon J in Deatons Pty Limited v Flew (1949) 79 CLR 370 at 381 of the decision in Lloyd v Grace, Smith & Co [1912] AC 716 (where a firm of solicitors was held liable for the fraud committed by its managing clerk on a client of the firm) as concerning "one of those wrongful acts done for the servants own benefit for which the master is liable when they are acts to which the ostensible performance of his master's work gives occasion or which are committed under cover of the authority the servant is held out as possessing or of the position in which he is placed as a representative of his master", Gleeson CJ adding "it is the nature of that which the employee is employed to do on behalf of the employer that determines whether the wrongdoing is within the scope of the employment" [46]. Dealing with the particular allegation under consideration, Gleeson CJ said (ibid at 544 [67]) - "It cannot be said that the risk of sexual abuse ought to be regarded as an incident of the conduct of most schools, or that the ordinary responsibilities of teachers are such that sexual assaults on pupils would normally be regarded as conduct (albeit serious misconduct) within the scope of employment. However, there are some circumstances in which teachers, or persons associated with school children, have responsibilities of a kind that involve an undertaking of personal protection, and the relationship of such power and intimacy, that sexual abuse may properly be regarded as sufficiently connected with their duties to give rise to vicarious liability in their employers." 217 In respect of the vilification that accompanied the exercise by Mr Chaloner of his authority over the plaintiff in the performance of his duties, applying the notion implicit in this passage from Gleeson CJ's judgment, I would hold that (with the exception of the "external" matters which I have referred to) Mr Chaloner's misconduct was indeed sufficiently connected with his duties to give rise to vicarious liability in his employer. Gleeson CJ also noted the recent decision of the House of Lords, Lister v Hesley Hall Limited [2002] 1 AC 215 where the employer of a warden who was in charge of a boarding annex at a school mainly for children with emotional and behavioural difficulties who had many of the responsibilities of a parent was held liable for his sexual abuse of some of the pupils. Concerning the particular issues raised by Mr Lepore's allegations, Gleeson CJ said (ibid at 547 [78] - "The fact finding at the first hearing was so deficient that it is not possible to form a clear view as to the strengths…[of a case based on vicarious liability]. However, the maintenance of discipline is clearly within the employment responsibilities of the teacher and much, perhaps all, of the alleged misconduct appears to have taken place in the context of administering punishment for supposed misbehaviour. It may be possible that some or all of it could properly be regarded as excessive chastisement, for which a school authority would be vicariously liable. The relatively minor criminal charges laid against the teacher, and the modest penalties imposed, may be consistent with this view of the matter. Whether excessive or inappropriate chastisement results from the sadistic tendency of a teacher, or a desire for sexual gratification, or both, it is conduct in the course of employment, for which a school authority is vicariously liable. If, on the other hand, some or all of the conduct of a teacher was found to be so different from anything that could be regarded as punishment that it could not properly be seen as other than merely sexually behaviour then, in relation to such conduct, the plaintiff would have no case based on vicarious liability. There appears to have been nothing about the duties or responsibilities of the teacher that involved him in a relationship with his pupils of such a kind as would justify a conclusion that such activity was in the course of his employment." (Emphasis added.)

Applying this reasoning to the circumstances here, it seems to me that, again excepting the "external" conduct, the impugned behaviour of Mr Chaloner was within the course of his employment, even though it was to a significant degree undertaken for his own personal gratification. Moreover, Mr Chaloner was involved in a superior/subordinate relationship with the plaintiff and the misconduct was the actual mode by which he exercised that authority with the result that, again, though improper and prohibited, it was undertaken in the course of his employment. 218 Gaudron J said (212 CLR at 561 [130-131], references omitted) - "The only principled basis upon which vicarious liability can be imposed for the deliberate criminal acts of another, in my view, is that the person against whom liability is asserted is estopped from asserting that the person whose acts are in question was not acting as his or her servant, agent or representative when the acts occurred. And on that basis, vicarious liability is not necessarily limited to the acts of an employee, but might properly extend to those of an independent contractor or other person who, although as a strict matter of law, is acting as principal, might reasonably be thought to be acting as the servant, agent or representative of the person against whom liability is asserted. Ordinarily, a person will not be estopped from denying that a person was acting as his or her servant, agent or representative unless there is a close connection between what was done and what that person was engaged to do. That was the focus of the attention of the House of Lords in Lister . However, that is not, of itself, the test of estoppel. Ultimately, the test is whether the person in question has acted in such a way that a person in the position of the person seeking the benefit of the estoppel would reasonably assume the existence of a particular state of affairs… In the case of vicarious liability, the relevant state of affairs is simply that the person whose acts or omissions are in question was acting as the servant, agent or representative of the person against whom liability is asserted." 219 In this case, I consider that the application of this principle would result in News and Group 4 being estopped, as against the plaintiff, from denying that Mr Chaloner was acting as their servant, agent or representative in connection with the acts (except the "external" acts) of which he complains. Although this may not be a sufficient test under this rule, I think it is clear that there was a very close connection between what Mr Chaloner did to the plaintiff and what he was engaged to do. I note that Gaudron J thought that "it seems there may have been a close connection between the acts of the teacher and that which he was authorised to do, namely chastise the plaintiff for his misbehaviour" although, in the result, the fact-finding process at first instance did not permit a resolution of the question. 220 Gummow and Hayne JJ, after a review of the authorities concluded, as I understand their Honours' judgment, that it was not possible to exhaustively describe the circumstances which would impose vicarious liability upon an employer for the employee's intentional acts and that any statement of principle must necessarily import an element of degree which would defy precise definition. Referring in particular, to the judgment of Dixon J in Deatons (1949) 79 CLR 370 at 381) their Honours said (212 CLR at 591 [231-232, 234] - "…There are two elements revealed by what his Honour said that are important for present purposes. First, vicarious liability may exist if the wrongful act is done in intended pursuit of the employer's interests or in intended performance of the contract of employment. Secondly, vicarious liability may be imposed where the wrongful act is done in ostensible pursuit of the employer's business or in the apparent execution of authority which the employer holds out the employee as having. [232] What unites those elements is the identification of what the employee is actually employed to do or is held out by the employer as being employed to do. It is the identification of what the employee was actually employed to do and held out as being employed to do that is central to any enquiry about course of employment… [233] … [234] Many cases in which it is sought to hold an employer vicariously liable for the intentional tort of an employee can be determined by reference to the first of these elements. The act of which complaint is made can be seen to have been done in the intended performance of the task which the employee was employed to perform. Cases of excessive punishment by a teacher may fall within this category. So too will many cases where a store detective wrongfully arrests and detains a person or in that process assaults them. No doubt the examples could be multiplied." 221 Of particular relevance in the context of this case (where I have held that Group 4 was under a contractual obligation to the plaintiff to provide a safe place of work and that included his safety from the reasonably apprehended risks of psychological injury caused by the at-work conduct of Mr Chaloner) is the point made by Gummow and Hayne JJ at 212 CLR at 593 [235] that a simpler mode of resolving the fraudulent clerk cases where the employer "may be in direct breach of an obligation owed to the person who has been defrauded…[that] may arise from a contract between the employer and the person who has been defrauded" although the contract would not be one "which can be seen as having been made by the fraudster on behalf of the employer". 222 Kirby J, as it seems to me, pointing to the instability of the principle of vicarious liability and the inevitability of answering the problem posed by its application as one in which "the common law will give an answer exhibiting a mixture of principle and pragmatism (212 CLR at 611, [299-300]) considered as persuasive the rationale for imposing vicarious liability for the intentional wrongdoing of an employee as "the application of an 'enterprise risk' analysis" (ibid at 612 [303]) explaining the foundation of the analysis "in the argument that profit making enterprises, which derive financial benefits from an operation, must bear the cost of any particular risks which such operation introduces into the community or exacerbates." Applying such an analysis here would seem to me to lead to the attribution of liability in News for Mr Chaloner's at-work misconduct towards the plaintiff. Kirby J also thought there should be what his Honour called "a candid acknowledgement that vicarious liability is a loss distribution device available in the cases to which it applies…[making it] essential to examine the problem of liability from the point of view of the victims of criminal wrongdoings" (ibid at 614[306]). In Lepore, as his Honour pointed out, children were entrusted to the school on the assumption that they would be cared for and not abused and commented that the "common law does not usually disappoint legitimate and reasonable expectations in such matters". It may be a fair analogy to consider that, having entrusted its employee, the plaintiff, to the system of work conducted by and the place of employment under the control of News, under the terms of a contract of employment that it was to be safe and, in particular, the plaintiff was to be safe from misconduct such as committed on him by Mr Chaloner, there was a "legitimate and reasonable expectation" that News would ensure that, indeed, the plaintiff's system of work and place of employment was safe. 223 It seems to me, therefore, that application of the various principles referred to in the judgments I have cited from Lepore favours a conclusion in favour of the plaintiff against News in respect of Mr Chaloner's at work misbehaviour. 224 In the result, I am satisfied that News is indeed vicariously liable for the at-work misconduct of Mr Chaloner towards the plaintiff and that, although this means that some parts of his misconduct, namely the "external" parts, cannot be matters for which News is liable, the exclusion of that behaviour does not significantly affect their liability for the injuries caused to the plaintiff. 225 The above discussion does not depend upon the finding that Mr Paine was told of Mr Chaloner's misconduct by Mr Kamaledine and that reasonable inquiries would have exposed its extent, including its potential for causing psychological injury. However, as it seems to me, the conclusion that News is vicariously liable for Mr Chaloner's misconduct is strengthened by that conclusion. 226 So far as Group 4 is concerned, whatever the formal position might have been between News on the one hand and Group 4 on the other, it is quite plain that Group 4, through Mr Blinkworth, effectively and for all practical purposes placed the plaintiff under the authority of Mr Chaloner in the situation where - with the exception, as I have held, of his predilection for racist vilification and other forms of physical and demeaning conduct - it was well known that he would push the plaintiff to the limit (and perhaps beyond) for the purpose, at least, of ensuring that the maximum level of service that could be squeezed out of the plaintiff would be and that intimidation of one kind or another would be resorted to if that were thought by Mr Chaloner to be either necessary or desirable. The plaintiff, I also find, was given to understand that it was his job to put up with Mr Chaloner's behaviour. 227 In placing the plaintiff in this position viz a viz Mr Chaloner, it seems to me that Group 4 accepted responsibility for the way in which the latter performed his function of supervising the plaintiff's performance of the contract between News and Group 4. Its responsibilities as the plaintiff's employer to the plaintiff both under its contract of employment and the general law could not be delegated to News. It is therefore vicariously liable, essentially for the same reasons as News, for Mr Chaloner's misconduct as having occurred in the course of what I might perhaps call his "constructive employment" by Group 4. 228 Moreover, Group 4 either knew of Mr Chaloner's misconduct towards the plaintiff through the knowledge of its other employees at the News' site or else had constructive knowledge of that misconduct because of its failure to prevent Mr Chaloner's intimidation or make reasonable enquiries about it and had not, or had not, put in place an appropriate procedure that would have given those employees an awareness of their duty to report such misconduct and encourage and support such reporting. 229 Accordingly, Group 4 is liable for the infliction of psychological injury on the plaintiff by Mr Chaloner both by virtue of its contract of employment and its duty at common law to provide a safe place of work.

Events following Chaloner's departure 230 As I have mentioned, Mr Chaloner was dismissed by News in January 1997. Initially, his work was taken over by the plaintiff. Despite this, the plaintiff's application for Mr Chaloner's position was rejected and, in May 1997, a Mr Gear was appointed in his place. The plaintiff felt threatened by Mr Gear and was plainly unhappy about this turn of events. 231 The incipient strains in their relationship, significantly contributed to, I am satisfied, by the emotional and psychological strain and ultimate illness of the plaintiff resulting from his mistreatment led to his separation from his wife. 232 Although the plaintiff continued to work it is clear that he was not able to operate effectively and his mental state so concerned Dr Phadke, his general practitioner, that he referred the plaintiff to Dr David Butler, a psychiatrist. The plaintiff was certified unfit for work from 25 June 1997 to 30 July 1997, returning to work at News Surry Hills' premises. He began to drink heavily. In August 1997, Mr Gear was moved from his position but, again, the plaintiff was not appointed to that office, which was given to a Mr Blisset in October of that year. I do not doubt that his work situation at this time contributed to the plaintiff's psychological problems. 233 In December 1997, the plaintiff approached a barrister (Mr Carney) for advice as to his position and on 17 February 1998, ceased work.

Plaintiff's medical evidence 234 The plaintiff's general practitioner, Dr Phadke, referred him to Dr David Butler for treatment in mid-1997 and Dr Butler has, since then, had responsibility for his psychiatric care. 235 The plaintiff gave Dr Butler a history of his treatment at Mr Chaloner's hands and his resultant feelings, more or less (I do not use this phrase in any critical sense) consistent with his evidence before me. Dr Butler noted that the plaintiff had continued to work regularly despite what Dr Butler considered to be his severe depression, although he reported that he was feeling so depressed several weeks before the consultation that "he took a small overdose of tablets and even asked his young nine-year old daughter to give him more tablets so that he would die and then said that if she did not give them to him he would force her to take them". Dr Butler was so concerned about this that he informed the Department of Community Service and told them that he felt the children might be at risk and arranged for the plaintiff to see the acute care team from the Central Coast Area Health Service. Dr Butler reports other treatment, which it is not necessary to set out in detail. He concluded as follows - "Mr. Naidu has been suffering from a severe chronic Major Depressive Disorder which has been present for at least the last eighteen months. In my opinion is has been substantially caused by his employment particularly the mistreatment from Mr. Chaloner. He has responded poorly to the treatments used so far for his depression and he has also at times been abusing alcohol which tends to make the situation worse and make him more likely to feel impulsively suicidal. Mr. Naidu is currently unfit for any duties and it is possible that it may take several months for him to gradually recover from his depression. If he returned to work at the New Limited site there would be a very high risk that this would cause a return of his depression even when he had recovered from it. When he is well enough to return to work I think this should be done initially on a part time basis and away from the News Limited site. At this stage there is no evidence of any permanent disability. However with such severe and chronic depressions as Mr. Naidu suffers, there is a very high risk of similar episodes in the future. If his condition continues to deteriorate he will need admission to a psychiatric hospital and possibly treatment with Electro Convulsive Therapy. The only investigations that I have ordered on Mr. Naidu were some blood tests done on the 14th June, 1997. These included a Full Blood Count and ESR, a TSH level, Blood Sugar Level and Serum Electrolytes, Urea and Creatinine, all of which were normal. The only abnormality was an elevation of one of the Liver Function Tests ALT at 67 unites per litre normal being 0 to 40 units per litre. The elevation of his ALT was probably due to his heavy intake of alcohol at the time. Mr. Naidu continues to need regular psychiatric treatment but he is finding this difficult to afford. At this stage I would like to see him on a weekly basis but he tends to cancel appointments saying that he can't afford it. This of course puts him at greater risk of worsening depression and suicide. I will be seeing him again next week." 236 In a report of 12 March 1999 Dr Butler concluded that, in addition to the plaintiff's chronic major depression, he was suffering from chronic post-traumatic stress disorder which, in his opinion, was substantially caused by his being mistreated by Mr Chaloner. Dr Butler's report referred to the plaintiff's admission between 2 and 23 December 1998 to the St John of God Hospital because of the worsening of his symptoms both of major depression and PTSD, despite his having been treated with anti-depressants and anti-psychotic drugs for auditory hallucinations which he began to suffer. He improved during his admission and could be taken off the anti-psychotic medication. The anti-depressant dose was increased. However, Dr Butler reported a gradual worsening of the plaintiff's psychiatric condition following his discharge from hospital, somewhat overlaid by physical complaints that may have resulted from the car accident he suffered in February 1996, to which I have already made reference in the context of Mr Chaloner's refusal to allow him to continue with his physiotherapy. Dr Butler reported a further worsening of the plaintiff's condition in the weeks preceding his report concluding that the plaintiff continued to be unfit for any work, either part time or full time, that depression and PTSD continued to cause major problems and were responding poorly to treatment. Dr Butler thought that there was a poor prognosis for recovery and that the plaintiff was likely to suffer from these problems for a long time although it could not then be said whether they would be permanent. Not surprisingly, in light of this conclusion, the doctor thought that he needed regular psychiatric treatment for at least the next two or three years and perhaps longer. So it has occurred. 237 The plaintiff was readmitted to the St John of God Hospital for two and a half weeks in September 1999 and again in March 2000. Dr Butler pointed out that the plaintiff's presentation at his consultations varied from one appointment to another, sometimes appearing normal or even actually cheerful, at other times angry or depressed.

238 The last report from Dr Butler is dated May 2004. He reported that the plaintiff continued with his three-weekly sessions of supportive psychotherapy and review of his mental state and need for medication. The doctor considered that the plaintiff was still suffering from severe chronic post-traumatic stress disorder but that over the last two years his depression had not been as severe and persistent, with the fluctuating depressed moods rather an incident of the former condition than due to depression. The doctor was still of the view that the plaintiff's mental condition had been substantially caused by his mistreatment at Mr Chaloner's hands. Dr Butler reported that although the plaintiff had some years earlier at times abused alcohol heavily, which tended to exacerbated his symptoms, he had stopped doing this and at the time of the report, drank only occasionally. Dr Butler considered that the plaintiff was not fit for any type of work, either part time or full time and did not think that he would ever be fit to return to any type of work. 239 Dr Butler was called to give evidence in the proceedings. Amongst other things, he explained that it was unnecessary for the plaintiff to be treated with electro-convulsive therapy on his admission into hospital because he improved during that admission. Dr Butler's evidence was tested in cross-examination by referring him to a number of matters, the most significant of which seemed to me to have been the possible effects on the plaintiff's mental state of the traumatic killing of his aunt in Fiji, the diagnoses on his last two admissions to St John of God Hospital of an adjustment disorder with depressed mood (which Dr Butler thought was an incorrect diagnosis but one that was often made where the patient did not satisfy sufficient criteria for a diagnosis of post-traumatic stress disorder or major depression), the plaintiff's lack of response to his being treated for the conditions diagnosed by Dr Butler, the opinions of the defendants' psychiatric experts, potentially severe stressors in his life and work other than those caused or instigated by Mr Chaloner and his own claims at the time he was seeking promotion to achieving high standards of work excellence and the resolution of the litigation. I do not propose to analyse this evidence. Essentially, Dr Butler adhered to the opinions in his reports and in my view gave sound reasons for doing so. 240 In October 2002 the plaintiff was sent for examination to Dr Christopher Canaris, a forensic psychiatrist, for a medico-legal report. Dr Canaris concluded that the plaintiff presented with a chronic mixed anxiety depression, a diagnosis which he considered to be essentially the same as the chronic post-traumatic stress disorder and major depression diagnosed by Dr Butler. Dr Canaris said that he saw its causes as intrinsically bound up with the plaintiff's workplace experiences and especially the inordinate harassment he underwent. He commented that his conclusion relied on corroboration of the plaintiff's history but there was no reason to disbelieve him. He considered that the plaintiff's condition is a prolonged and intractable illness suggesting that he was likely to remain permanently disabled. He thought that, even if the plaintiff managed to get through an interview when seeking employment and be accepted, he would be likely to crumble in the face of any perceived criticism. He also thought that the plaintiff lacked "the persistence and pace to manage in the workforce". Dr Canaris saw the plaintiff again in March 2004, concluded that there was little, if any, improvement and his diagnosis remained the same. Dr Canaris held out the possibility that, following the conclusion of the litigation, the plaintiff might recover sufficiently to work again but was fairly pessimistic about this prognosis. 241 Dr Canaris was called to give evidence during the trial. Amongst other things, Dr Canaris elaborated his view of the plaintiff's prognosis. In sum, he thought - for reasons which seem to me to be sound - that the plaintiff was unlikely to improve significantly. Cross-examination of Dr Canaris substantially proceeded along four lines: the first was to bring to his attention certain stressors (to which I have referred in one way or another already) which did not form part of Mr Chaloner's misconduct; the second line concerned the potential for improvement in the plaintiff's condition should his case be successfully resolved; and the third concerned some aspects of his history which showed an apparent ability to cope that was greater than the plaintiff was prepared to admit, such as his own work assessments, his coaching of a junior soccer team, his ability to cope with some days of giving evidence and cross-examination about the impact of obviously severely distressing events, such as traumatic deaths in his family, which were unconnected with work. Dr Canaris did not consider that any of these matters, if accepted, materially affected either his diagnosis or the prognosis. I do not propose to analyse this cross-examination but wish simply to note that it seemed to me that the doctor's position was both reasonable and persuasive. 242 A report of Dr Peter Klug, a forensic psychiatrist, of August 2002 was also tendered on the plaintiff's behalf. The report was contemporaneous with Dr Klug's examination of the plaintiff. The history related in the report, broadly speaking, is consistent with the other histories given by the plaintiff and with the plaintiff's evidence. Dr Klug's opinion was that the plaintiff suffered from worsening symptoms of both anxiety and depression from the time of his contact with Chaloner, developing a major depressive disorder which he described as "a severe psychiatric disorder". Many of the plaintiff's symptoms also indicated, according to Dr Klug, "the long-standing presence of a severe anxiety disorder which it was reasonable to regard as being a post-traumatic stress disorder". Dr Klug considered the plaintiff to be chronically dysfunctional, requiring ongoing psychiatric care, with an uncertain prognosis. He concluded that the plaintiff's "psychiatric problems are…a direct consequence of the behaviour of Mr Chaloner and the failure of his employer to support him when he reported these problems". I think it likely, as I have said, that the plaintiff now believes that he reported Mr Chaloner's misbehaviour and the failure to correct the situation undoubtedly caused him distress, but I am somewhat doubtful that the failure of the employer contributed to his psychiatric condition except in the sense that his subjection to Mr Chaloner thereby continued. It is in this latter sense, I think, that Dr Klug meant the passage which I have quoted. 243 Dr Klug was called to give evidence. He expressed the opinion that what might fairly be called the workplace abuse made a material contribution towards the plaintiff's psychiatric condition. I found his explanation for the emerging prominence of the plaintiff's PTSD helpful and persuasively supportive of, especially, Dr Butler's opinion in this respect. Dr Klug repeated his conclusion that, when he saw the plaintiff, he thought that was not really capable of working at all for the foreseeable future. He considered that although it is possible that he would improve, this was speculative. 244 The following is a description of the major lines of cross-examination and my response to them. Dr Klug was cross-examined as to the causes of PTSD and expressed the opinion that it is a condition that is normally associated with a situation in which the person feels that his life or physical integrity is threatened, or he experiences a state of profound helplessness or witnessed this happening to someone else. (I consider that the plaintiff felt almost continuously physically threatened in one way or another by Mr Chaloner and that he certainly experienced a state of profound helplessness over much of the period that he worked as his assistant.) There was no real attempt to contradict this evidence and no reason for me to reject it. Rather, the cross-examination sought the doctor's opinion on the possible significance (as alternative explanations for the plaintiff's depression, as I understand it) of dreadful murder of his aunt and his failure to procure promotion into Mr Chaloner's position. Nothing in the doctor's answers to this line of questioning led me to doubt the reliability of either Dr Butler's or Dr Klug's opinions, as I have described them above. Dr Klug was also cross-examined about the significance of the plaintiff's own statements about his capacity and achievements when he was seeking promotion and the fact that he appeared to get on well with his work colleagues. In short, Dr Klug thought that this conduct was a way that the plaintiff was attempting, ultimately unsuccessfully, to cope with his illness. When the whole of the plaintiff's presentation is taken into account, I think the doctor's view is plainly right. 245 Other medical evidence was tendered on the plaintiff's behalf but it has not been necessary for me to refer to it.

Group 4 medical evidence 246 The plaintiff was examined by Dr Alan White, a consultant psychiatrist, on 24 September 2001 and 11 June 2003 at the instance of Group 4. Included in the tendered reports is a very useful preview and summary. In the first of these reports, Dr White states that the purpose of his interview was to assess the nature of the plaintiff's psychological symptoms and to offer an opinion as to whether they were due to his employment with Group 4. He had the benefit of reading quite extensive documentation but noted that it did not "confirm Mr Naidu's numerous allegations" adding that the "documentation provided…is incomplete and insufficient". Dr White commented on the plaintiff's history that it was "extraordinary and very lengthy" and "verged on the implausible". He said that the plaintiff, in September 2001, described symptoms which were "suggestive of Major Depression" characterised by Dr White as "a constitutional psychiatric disorder (by which is meant a genetically related brain disorder) from which recovery can be anticipated within six to twelve weeks of compliance to a comprehensive treatment program". On the other hand, the doctor noted that Major Depression "has a ninety per cent risk of spontaneous relapse once an individual has had a first episode". Dr White found no objective evidence of mental illness on the mental state examination and was unable to relate the severity of the plaintiff's symptoms to his behaviour during the interview. As I read his opinion, he concluded that the plaintiff's symptoms were apparently exaggerated for this reason. It seems, however, that the doctor saw no signs of exaggeration in the plaintiff's actual behaviour which, on the face of it, appears to conflict somewhat with the conclusion that the plaintiff was exaggerating. Dr White thought that, on the assumption that the plaintiff suffered from Major Depression, "which is a temporary and treatable constitutional mental illness" a failure, if there was a failure, to recover from it within twelve weeks of the initiation of treatment demanded "referral to an expert in the management of mood disorders for an opinion, if not to take over management". 247 As I read his report, Dr White considered that, accepting that there was an aggravation of this underlying constitutional disorder, this would subsist for a period of six to twelve weeks and, accordingly, he concluded that the psychological symptoms of September 2001 could not be reasonably attributed to the events at work (which ceased in 1998) "because ongoing symptoms would be due to constitutional factors and to suboptimal treatment". His overall conclusion was that the plaintiff "may suffer from a psychiatric disorder but that psychiatric disorder can no longer be reasonably or logically attributed to his employment". 248 In dealing with Dr White's report, I am troubled by the extensive discussion in it of the so-called supporting material. The doctor's opinion on whether or not the plaintiff's history of the treatment to which he had been subjected by Mr Chaloner is verified by extrinsic material with which he had been provided was itself persuasive or convincing is irrelevant. The question was simply not a medical one and the material was not medical material. It is difficult enough to discern the material upon which Dr White's ultimate medical opinion is founded without attempting to separate out his irrelevant opinions on the material facts. The form of reports such as this has long been criticised by the courts but it seems that practitioners find themselves unable to understand and apply the relatively simple distinction between assumptions on the one hand and facts on the other, let alone ensure that medical or other specialised experts are confined to giving opinions based upon assumptions and are not asked to consider whether one or other set of arguably controversial facts occurred or not. 249 The intrusion of this entirely inappropriate task has made it difficult for me to assess the proper weight to be given to Dr White's opinions concerning the plaintiff's condition. At a number of salient points the doctor appears to have allowed his scepticism concerning the reported character of Mr Chaloner's behaviour to intrude into his view of the plaintiff's condition. 250 I should note, in fairness, that Dr White considered that none of the events reported by the plaintiff, on the assumption that they occurred, "would be expected to cause a mental illness in a non-vulnerable person but could precipitate mental illness in an individual with genetic vulnerability". In this context, Dr White has unsurprisingly emphasised the importance of the fact that the stressors brought about at work abated in early 1998 without improvement in the plaintiff's condition. This conclusion, however, is coupled with a view that the plaintiff "appeared to be making a case that he had somehow been rendered permanently mentally ill as a consequence of the events of work but the reality is far from the case" which I consider to be an immaterial speculation about the plaintiff's motives and, at all events, one which does not seem to me to reflect significantly upon the plaintiff's credibility in the sense that it might well reflect a genuine understanding or belief about the causes of his mental state. The doctor's criticism of a lack of "evidence-based best practice medicine" (implicitly a comment about Dr Butler's treatment) does not seem to me to have much weight in the context of the problem to be determined in this litigation but it seems to me that this view has strongly influenced Dr White's conclusions. 251 Dr White's report contains a very useful and extensive discussion of the potentially relevant conditions suffered by the plaintiff, including those which had been identified by the plaintiff's medical experts. That discussion has not persuaded me that I should not accept as more probably correct than not the conclusions (though they differ somewhat in their emphases) of the plaintiff's medical experts. As I have mentioned, Dr White saw the plaintiff again in June 2003. His ensuing report is somewhat more comprehensive than the earlier report but its essential thrust is the same. The doctor concluded - "It is possible that Mr Naidu may have in the past suffered from a psychiatric disorder such as Major Depression but the effects of Mr Chaloner's behaviours, if true, would have ceased within six to twelve weeks of his separation from Mr Chaloner. One can say with reasonable medical certainty that his chronic psychiatric symptoms are unrelated to his employment…which ceased in 1998. He does not and never has filled the Criteria (A) through to (F) for PTSD from the DSM-IV-TM (2000)." 252 Many of these matters and others were explored in the course of cross-examining Dr White. I considered that Dr White was a forthright and candid witness but, overall, his scepticism about the truthfulness of the plaintiff's complaints concerning Mr Chaloner was so strong, pervasive and influential in respect of his medical conclusions and so much at odds with my own findings on this question that I was unpersuaded (in particular) that the opinion of Dr Butler was wrong. Certainly, Dr White's medical views, in particular, as to the nature, causes and prognoses of PTSD are by no means idiosyncratic and represent a respectable class of psychiatric opinion upon the medical issues in this case. Indeed, in some respects his critique was an apt corrective to some aspects of the plaintiff's medical evidence. However, I give significant weight to the fact that Dr Butler's experience with the plaintiff as his treating psychiatrist is long standing and have concluded that his opinions concerning the plaintiff's condition and its causes should be preferred.

News' medical evidence 253 News tendered the report of Dr Ronald Joss, a neurologist who examined the plaintiff in March 2004. Dr Joss noted that one of the reasons for his examination was the possibility referred to by Ms Judy Bokor in one of her reports that the plaintiff might have been suffering from Temporal Lobe Epilepsy. Dr Joss concluded that although some of the plaintiff's symptoms could be attributed to temporal lobe phenomena, he would be surprised if this were the case and suggested that a telemetric EEG study to exclude the possibility more certainly. This was performed and in April 2004 Dr Joss provided a supplementary report the effect of which is that the plaintiff had no neurological problems. 254 The plaintiff was also seen on News' behalf in October 2003 by Dr Leonard Lee, a consultant medico-legal psychiatrist. Dr Lee referred to the plaintiff's presenting "a complex and unusual history" involving a number of enumerated accusations made against Mr Chaloner. Dr Lee carefully reviewed accompanying documents that had been provided to him that, he said, indicated that the plaintiff had not informed him of a number of matters regarded by the doctor as material to the plaintiff's truthfulness in a number of respects (but which do not seem to me to significantly affect his psychiatric symptoms). Dr Lee concluded that the plaintiff's condition represents "abnormal illness behaviour, either in the form of Factitious Disorder or malingering". He thought that the plaintiff "may have dependent and obsessive-compulsive personality traits because, as I understand it, "some of his claims are collaborated…[while] others are not". The Doctor noted that the results of the "Minnesota Multiphasic Personality Inventory is consistent with gross exaggeration of psychiatric symptoms and minimisation of pre-existing psychiatric vulnerability". Dr Lee's report commenced with an expression of scepticism concerning the truthfulness of the plaintiff's allegations of harassment. The report contains a lengthy analysis of documentary material made available to him which, for the reasons I have already mentioned in connection with Dr White's report, is not only inappropriate but led Dr Lee to conclusions which differ markedly from my own. Furthermore, the Doctor's views about these matters have, I think, significantly affected his conclusions on the medical questions and, to that extent, I do not feel justified in attributing to them the weight which they might otherwise deserve. On the other hand, Dr Lee concludes that, if the plaintiff "has truly been a victim of sexual and racial harassment, it is feasible that it has caused him a psychiatric disorder that one would have expected him to have recovered from with treatment". Whether or not any psychological problems prevent him from obtaining employment in the future, Dr Lee thought, was unclear. 255 Dr Lee was called to give evidence. In cross-examination Dr Lee made a number of reasonable concessions concerning diagnoses of PTSD and Major Depression which brought him a little closer to the plaintiff's medical evidence than was apparent from his report and would seem to me to be reasonably expressed. He adhered to the opinions which I have already stated. Again, although Dr Lee's analysis of the material was not entirely unhelpful it did not by itself or in combination with the other medical evidence presented on behalf of the defendants persuade me that I should not accept as probably correct the conclusions of Dr Butler and the other experts called by the plaintiff to which I have referred.

The Limitation Act defence 256 The statement of claim with which these proceedings commenced was filed on 20 March 2001. It is obvious from the summary of the evidence that, so far as the plaintiff relied on breaches of his contract of employment, these commenced in about April 1992. I have accepted Dr Butler's opinion that the plaintiff's psychological illness became evident in about November 1996. 257 Both defendants therefore rely on the limitation defence, Group 4 on s151D of the Workers Compensation Act 1987 and News on the Limitation Act 1969. The latter Act provides - "60C Ordinary action (including surviving action) (1) This section applies to a cause of action, founded on negligence, nuisance or breach of duty, for damages for personal injury, but does not apply to a cause of action arising under the Compensation to Relatives Act 1897 . (2) If an application is made to a court by a person claiming to have a cause of action to which this section applies, the court, after hearing such of the persons likely to be affected by the application as it sees fit, may, if it decides that it is just and reasonable to do so, order that the limitation period for the cause of action be extended for such period, not exceeding 5 years, as it determines.

60E Matters to be considered by court (1) In exercising the powers conferred on it by section 60C or 60D, a court is to have regard to all the circumstances of the case, and (without affecting the generality of the foregoing), the court is, to the extent that they are relevant to the circumstances of the case, to have regard to the following: (a) the length of and reasons for the delay, (b) the extent to which, having regard to the delay, there is or may be prejudice to the defendant by reason that evidence that would have been available if the proceedings had been commenced within the limitation period is no longer available, (c) the time at which the injury became known to the plaintiff, (d) the time at which the nature and extent of the injury became known to the plaintiff, (e) the time at which the plaintiff became aware of a connection between the injury and the defendant's act or omission, (f) any conduct of the defendant which induced the plaintiff to delay bringing the action, (g) the steps (if any) taken by the plaintiff to obtain medical, legal or other expert advice and the nature of any such advice the plaintiff may have received, (h) the extent of the plaintiff's injury or loss. (2) …"

Section 151D of the Workers Compensation Act 1987 imposes an identical time limit "except with the leave of the court in which the proceedings are to be taken". 258 At the forefront of the submissions of the defendants is the evidence concerning the loss of certain News records. Mr Biokka, the Group Employee Relations Manager for News since March 1998, gave evidence that he had attempted, upon receipt of an appropriate subpoena, to obtain News' records relevant to the case including Mr Chaloner's employment history and files. Those files could not be located. The subpoenas had been issued in 2002.

259 The question, in substance, is the same under both limitation provisions, namely, whether "it is just and reasonable" to extend the limitation period to the date upon which these proceedings commenced. 260 So far as any delay is concerned, it is evident that no action for negligence arose until about the plaintiff commenced to suffer from major depression which was reported by Dr Butler on 25 June 1997 to Dr Phadke as having been present and worsening over "at least the last few months" and, in a later report, as having been in existence since, at least, November 1996. For obvious reasons, where psychiatric illness is the gravamen of the cause of action, when the illness - ie the injury - has been caused is a difficult matter to determine. Such illnesses will often be of gradual onset, a point emphasised by Dr Butler's phrase "at least". The first complaint noted in Dr Phadke's notes suggestive of psychological injury was made on 30 May 1997. PTSD was diagnosed in about November 1998. It is fair, however, to note that the plaintiff could scarcely be taken to have known that he suffered from a psychological illness until Dr Butler's report of 25 June 1997. 261 In brief, the evidence of Mr Carney and Mr Sparks as to how the matter unfolded is sufficient to persuade me that delaying the commencement of proceedings until March 2001 was not unreasonable. I note that, in respect to the plaintiff's PTSD, which was not diagnosed until late 1998, it may be that the action is not statute barred. However, I think that this diagnosis should be seen, as should the diagnosis of major depression, as recognition of an injury (albeit a psychiatric injury) that had been inflicted at a much earlier time. It seems plain that the principal reason for delay in the commencement of proceedings was the time it took for the plaintiff's psychological injury to become evident. 262 Having regard to the close connexion between News and Group 4 concerning the misconduct of Mr Chaloner towards the plaintiff, as evidenced in particular by the contents of the proffered Deed of Release, it seems reasonable to infer that News investigated well prior to the commencement of proceedings the nature of Mr Chaloner's misconduct so far as it was then discoverable and was likely to have been made aware of the plaintiff's condition at least in general terms as disclosed to Group 4. No suggestion is made that the delay has prejudiced the medical cases sought to be maintained by either party. At all events, such a submission could not in my view be sensibly maintained. Prior disclosure - when the plaintiff was still working as Mr Chaloner's subordinate - would have been significant for obvious reasons. 263 It is this problem that brings into prominence the only major issue posed by s60E(1) facing the plaintiff. There are two specific points that need to be made in this regard. As it happens, they are touched on by s60E(1) (e) and (f). The first is that it is the plaintiff's evidence that he frequently complained to Mr Blinkworth about Mr Chaloner's misconduct. I have found that, although it is likely that he did make some complaints from time to time to Mr Blinkworth, they were not such as to convey more than the use offensive remark or conduct, let alone that they were part of a continuing course of racist vilification. On the other hand, I have found that Group 4 should have been aware by 1994 or early 1995 from its employees on the News site of some racist abuse and bullying behaviour that should have alerted the company to the likelihood, in the circumstances and what Mr Blinkworth himself knew of Mr Chaloner's way of dealing with staff (himself, not least), of significant breaches of its obligations to protect the plaintiff from wilful misbehaviour by Mr Chaloner calculated to cause at least considerable distress and potentially, if continued for a period and at an intensity well within reasonable likelihood, some psychological damage. So far as News is concerned, my findings as to Mr Kamaledine's disclosure to Mr Paine of misconduct towards the plaintiff by Mr Chaloner are significant. Moreover, both defendants, one way or another, placed the plaintiff in the position where he felt completely under Mr Chaloner's thumb and found it very difficult (in the result impossible - as I find despite the plaintiff's evidence to the opposite effect) to make explicit complaints about his misconduct.

264 The major proportion of the conduct complained of occurred in the period between mid-1992 and late 1996. 265 On 4 March 1998, Tempo Services Pty Ltd of which Group 4 was a wholly owned subsidiary, received an application from the plaintiff for workers' compensation. The company, which undertook supervision of such claims against its subsidiaries, noted that its insurer undertook an investigation that resulted in the claim being accepted and compensation being paid. The claim was for psychiatric injury sustained in the course of employment as a result of sexual, verbal and physical harassment. Compensation was continuously paid from an early date to the date on which this action was commenced. In March 2001 Group 4 issued a subpoena directed to News and discovered that News' records concerning the allegations against Mr Chaloner were missing. However, it is not true to claim, as Mr Little, counsel for Group 4 submitted, that his client was prevented from identifying the News' employees who may have known about the allegations against Mr Chaloner's conduct and shed light on both that conduct or the results of any investigation. 266 It should have been obvious from the plaintiff's workers compensation claim that Group 4 may have been at risk of further action. Its relations with News were close. Not to have investigated the circumstances of the plaintiff's complaints - which, after all, concerned an important question of workplace safety, and why (if this were the case) the problem had not been disclosed either to or by its own employees - indicates such a significant disregard of its own obvious interests as an employer (quite apart from being a potential defendant) that it is difficult to take altogether seriously its present complaints of prejudice arising out of the plaintiff's delay in commencing proceedings. Such inquiries could easily have been made and the relevant employees easily identified. Their recollections would not have been as reliable as contemporaneous accounts, of course, but I am sceptical that the loss of the records was a significantly intervening prejudicial occurrence. There is no suggestion that Group 4's records are missing. 267 It is further submitted that Group 4 was prejudiced by the information given by the plaintiff to the investigator, Ms Phillipa Moss, on 13 March 1998, that he now claims to be false, that he did not inform Group 4 of Mr Chaloner's misbehaviour at the time it occurred. In this respect Mr Blinkworth is the major witness for Group 4 and it followed that he was being asked to recall events, so far as they concerned him, going back many years. However, he evinced no real difficulties of recollecting important matters: this problem in the end was more hypothetical than real. 268 I have borne in mind the important consideration that a party might be prejudiced in ways it might not know. Having regard to the evidence as a whole, I am satisfied that this risk is very low in this case. News relies principally on its missing file or files as demonstrating actual significant prejudice. However, it was aware of the nature of the plaintiff's allegations against Mr Chaloner from the time of the interview with Ms McDiarmid. Those allegations were very serious. They were investigated by News and verified to a degree sufficient for Mr Chaloner to have been dismissed. Acting properly, they would have been investigated virtually to the same degree as would or should have occurred if proceedings had been commenced. I am prepared to conclude that the papers were missing because of some organizational failing. They were papers the importance of the preservation of which was obvious, for reasons entirely distinct from the possibility of impending litigation. That is no doubt why they were kept in Ms McDiamid's office. News' lawyers had been consulted at an early stage and had every reason to ensure safe retention of the material. I think it may well have lost even if the plaintiff had commenced litigation before the limitation period expired. 269 The plaintiff gave evidence about his consideration of the question of commencing litigation and called evidence about it from Mr Niall Carney, a barrister, and Mr George Draca, solicitor. Mr Carney said that he first met the plaintiff in December 1997. The plaintiff complained to him about harassment and discrimination in his workplace and gave some details. He said that he had been dismissed in June 1997 and had been asked to sign a deed of release concerning the alleged misconduct of Mr Chaloner. The plaintiff wanted advice on whether he should sign it. Not surprisingly, Mr Carney advised him not to do so. The plaintiff also told Mr Carney about other events, including his treatment by Dr Butler for depression. Mr Carney asked the plaintiff to obtain a medical report and give him a "complete resume of what the story was about." (I have already discussed this account in the context of its omitting to mention relevant complaints.) 270 Mr Carney said that the plaintiff was still employed, though he was on compensation, and therefore thought the only potential actions, for workers' compensation or "employment law issues", had not arisen. The position was made clearer when he obtained Dr Butler's report of 2 April 1998 and he sent the plaintiff to see Mr Sparks, a solicitor. Mr Carney saw the plaintiff again on 19 February 1998 when he complained of having major depression and discussed his work for Group 4. Mr Carney said he sounded as though he liked his work as a fire control officer designing systems and wanted to get back to it. The plaintiff told him he was still receiving worker's compensation. On 22 April 1998 Mr Carney attended a meeting at Messrs Minter Ellison, News' solicitors, at which also were the plaintiff, Ms McDiarmid, Mr Paine and members of the firm. The purpose of this meeting was to obtain the plaintiff's execution of the deed of release to which I have already referred. Mr Carney did not inform the plaintiff that he had a cause of action about the conduct to which he had been subjected, because, as he saw it, he thought he did not have any. 271 Mr Draca, the plaintiff's solicitor in the present proceedings, first met the plaintiff in late 1999. There was a brief consultation. The plaintiff was asked to provide a detailed statement of his allegations of mistreatment. This statement was provided in about March 2000. Mr Draca undertook other enquiries, such as obtaining medical reports and witness statements. That material had not been collected until late in the year. He said that he first discussed the issue of possible common law actions with the plaintiff in January 2001. Mr McAuley of counsel had been briefed to advise. 272 Dr Butler reported to the plaintiff's solicitors in October 2001 that the plaintiff's psychiatric condition did not impair his ability to obtain and understand legal advice about his position. Dr Butler reported the plaintiff as having told him in September 2001 that he thought that the period of limitation ran for three years from the date of termination of his employment in 1998 and that he thought that it was most likely that a friend had told him this. He believed that this information was correct until he was told otherwise at a recent meeting with his lawyers. 273 On 25 January 2000 the plaintiff's solicitors wrote to Group 4 to advise that they had been retained by the plaintiff to advise on his workers' compensation rights and requesting certain particulars. Although the letter did not say so, it must have been obvious that the plaintiff would have sought advice or, at least, should have been advised about his common law rights, if any. Mr Draca said that he did not recollect any discussion with the plaintiff about any potential common law action until investigations had been completed in late January 2001. 274 In February 2000 Mr McAuley of counsel advised amongst other things that, on one view of the facts, the limitation period applicable to actions that might be brought against the defendants might have expired and leave this required to enable any such actions to proceed. The advice suggests a number of enquiries needed to be made but it does not condescend to propose with any reasonable precision what the causes of action might be. This is no criticism of counsel. The matter was very much at its tentative beginnings and much needed to be gather before any action could be commenced and the applications for leave to proceed prepared. In the result counsel (to whom Mr McCauley had passed the brief) provided a draft statement of claim and Part 33 particulars on 6 December 2000, advising retainer of eminent senior counsel. He also advised that the statement of claim should" if possible…be filed prior to Christmas". 275 Amongst other significant issues, the question of costs loomed large since it was clear that the plaintiff could not afford to pay any substantially legal fees. The solicitors were entitled to move with a degree of circumspection for this reason as well. Briefs to advise and appear were sent to Mr Barry QC in January 2001 and, in February 2001, to Mr Semmler QC. Mr Semmler emphasised the need to commence proceedings urgently and, in substance, advised (what I might call) the precautionary filing of a statement of claim. He pointed out that the application for extension of time required "comprehensive affidavits", noting the not insignificant problem that an "enormous amount of work" needed to be done to obtain material directly relevant to the form and substance of the proposed actions, not only for the purpose of drafting satisfactory claims but supporting the applications for leave. It was clear that this must be an expensive undertaking. 276 It should be noted that this activity was occurring in a context where both defendants had been well and truly made aware of the risk of litigation in connection with alleged misconduct by Mr Chaloner which of itself called for thorough investigation which, it appears, had either occurred or was in the course of being undertaken. 277 Of course, the plaintiff should have acted with alacrity. But he was, as I have found, not insignificantly disabled by his illness. Of course, his solicitors should not have delayed even for a short time without good reason. But even in well-run firms matters can be overlooked under the pressure of work. The delay in this case towards the end of 2000 and at the beginning of 2001 should not have occurred but is not substantial and not, I think, culpably careless or deliberately tactical. 278 It is necessary to give due weight to the fundamental consideration that the plaintiff's causes of action (with the possible exception of the action for negligence in respect of PTSD) had expired by the time he commenced the proceedings. The ultimate question is whether it is "just and reasonable" to extend the limitation period to permit the plaintiff to sue. This test is indistinguishable from the test applying to s151D(2) of the Workers Compensation Act, which is whether "it is fair and just that leave should be granted": Salido v Nominal Defendant (1993) 32 NSWLR 524 at 530 per Gleeson CJ; Itex Graphic Pty Ltd v Elliott [2002] NSWCA 104 per Ipp AJA at [87]. In applying this test, a number of factors must be considered. They are by no means limited to the issue of actual or potential prejudice to a putative defendant in the conduct of the time-expired proceedings. Amongst the prejudicial effects of delay from the community's point of view is that of the desirability that possible parties to litigation be able to organise their affairs on the basis that claims have lapsed and they have no liabilities beyond a definite period. There is also the public interest in the rapid settlement of disputes. Of course, there is also the public interest in permitting cases to proceed even where the limitation period has expired if it is fair and just to do so, an interest which is explicitly recognized by the jurisdiction given by the legislation to the Court to grant leave where such is the case. But it is obvious that such cases constitute exceptions to the general rule preventing such litigation from being undertaken: see, eg, Ipp AJA ibid at [89-90] and cases there cited. The overriding requirement is that the applicant "show that his or her case is a justifiable exception to the rule that the welfare of the State is best served by the limitation period in question: Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541 at 554 per McHugh J. 279 Having regard to the circumstances as a whole, including especially the nature of the plaintiff's case depending upon the gross misconduct of Mr Chaloner who was a senior employee of News and the day-to-day actual supervisor of the plaintiff to the knowledge of and as agreed to by Group 4, I consider that the plaintiff has established that it is just and fair that he be given leave to proceed. There are some unexplained gaps in the delay in commencing action once the basis of the action became clear enough to advise its undertaking but I do not think these to be of such significance as to qualify the appropriateness of granting leaving on the circumstances taken as a whole. 280 Nor do I consider that the defendants have been unfairly prejudiced in the preparation or presentation of their cases by virtue of the delay in commencement of the proceedings.

Apportionment 281 News has submitted that it should be indemnified by Group 4, in the event that the plaintiff's evidence on reporting his complaints to Mr Blinkworth was accepted. I have not so found. Otherwise, the defendants have not made substantive submissions on this point. It is complicated by issues of aggravated and exemplary damages as well as the different impacts of Division 3 of Part 5 and s151Z of the Workers Compensation Act 1987. Broadly speaking, I would assess the differing contributions to the plaintiff's injury as 65% attributable to News and 35% attributable to Group 4. This represents, in large part, a reflection of the fact that Mr Chaloner was News' employee and that Mr Kamaledine reported some of his conduct to Mr Paine. Having regard to my findings on several heads of damages, however, the way in which this apportionment works its way out in the ultimate judgment needs to be further considered by the parties and I will give them an opportunity to be heard on the issues raised.

The extent of the plaintiff's incapacity 282 I have concluded that, from the time the plaintiff was dismissed from his employment with Group 4 he has been, for all intents and purposes, completely incapacitated for any form of paid employment. I also consider that he is likely to remain so incapacitated for the foreseeable future. There is nevertheless some reasonable possibility that he might become well enough for some work, though he will be able only to undertake casual work that does not impose significant demands of compliance with timetable or achievable goals. I assess this likelihood at 15%. Out-of-pocket expenses 283 The Group 4 workers' compensation insurer has paid the plaintiff's expenses to $111,403.12. Other out-of-pocket expenses have no doubt been incurred since evidence was completed. I leave this item for the parties to agree and, failing agreement, to mention the matter and obtain a date for determination.

Future medical expenses 284 Dr Klug thought that the plaintiff needed to be under the care of a psychiatrist to oversee his treatment and a competent psychologist for therapy. He thought that this should occur "frequently". Dr Klug also thought that the plaintiff might require intermittent inpatient treatment both for treatment of any exacerbations of his conditions and for family respite. Dr Butler thought that that the plaintiff would continue to need supportive psychotherapy. He was seeing the plaintiff every three weeks but the doctor would like that reduced to perhaps every four to six weeks if he showed any improvement. His anti-depressant medication (Avanza) needed to be continued. Dr Butler charged $178 a session. The cost of the medication was between $21 and $23 a box, which should last a month. Dr Bokor also thought that the plaintiff would benefit from seeing a psychologist such as Ms Bokor. Ms Bokor considered that the plaintiff should continue to obtain therapy from a psychologist fortnightly "for a long time". The relevant rate is $160 an hour. 285 It is not surprising that there is no specificity about the plaintiff's need for future care. I am satisfied that it is substantial and that it will continue for many years. It seems to me that the best estimate that I can make is that, overall, the plaintiff will need to see a psychiatrist for supervision, both medical and pharmacological, every six weeks and that the relevant rate is $178 a session. He will need to see a psychotherapist every two weeks at $160 a session. An allowance of one week every two years for hospitalization should be made, plus three weeks a year inpatient care for respite care. Anti-depressant medication at $23 a month should also be allowed. This care should be calculated over the plaintiff's life expectancy. The chances of improvement are so speculative that I do not think that it is fair to discount the present value of these costs. Moreover, the increasing pressures of age and illness may rather increase the plaintiff's need for help rather than suggest any reduction. 286 I invite the parties to agree to an appropriate sum to reflect these findings, in the absence of which the matter can be set down before me for determination.

Economic loss 287 As at the date the plaintiff's employment was terminated by Group 4, his gross salary was $60,000pa, net after tax $39,205. It is submitted that on his behalf that a fairer comparable salary was that of Mr Chaloner who, at the time of dismissal, was paid $85,200pa. On the other hand, it is submitted that the plaintiff's salary was artificially high by virtue of the "accident of history" that he was employed at the News site, the contract for which was subsequently lost by Group 4 and that, if he went to work at other sites for Group 4, his salary would have been comparable to that of other site security managers - employed at major city sites - whose salaries in 1997 were $40,000 and $30,000 pa. These salaries are so much lower than that of the plaintiff, I am satisfied that their responsibilities could not have been truly comparable. 288 In my view, the measure of plaintiff's economic loss must start at his earnings as at the date of dismissal. The evidence does not permit me to be satisfied to the relevant degree that he was capable of earning at the rate paid to Mr Chaloner, as contended by the plaintiff, who submits that he would have been able to undertake work at the management level represented by Mr Chaloner. I have profound doubts that this is the case. His demonstrated and claimed responsibilities were at a somewhat lower level of competence, although there is no contradiction of his evidence that Mr Chaloner took credit for some significant parts of his systems design work at various News sites. Moreover, the plaintiff's ability to develop his work skills and management experience was seriously handicapped by the disabling effects of Mr Chaloner's treatment of him. 289 The plaintiff's evidence that he was doing much more than merely acting as Mr Chaloner's assistant on the Surry Hills site was uncontradicted and is sufficient, I think, to show that the plaintiff's true earning capacity was not sufficiently recognized by his employer and reflected in his salary. 290 I assess the appropriate figure at the gross salary of $70,000pa. I think that this would have placed the plaintiff at close to the top of his level of competence, experience over time aside. In the absence of further evidence on likely progression, I can make no assessment as to whether this was reasonably likely or what salary he might have earned. I would hold that the plaintiff would, more probably than not, work to the age of 65 years. 291 I leave to the parties the responsibility of agreeing this element of the plaintiff's damages, failing which, I will hear further argument and determine the matter.

Interest and Fox v Wood 292 Interest is agreed at 2%. It should be payable from the date of dismissal, 9 November 1998. The Fox v Wood figure is agreed at $10,430.99.

Vicissitudes 293 As mentioned, an allowance of 15% for the normal vicissitudes of life, should be made, together with a further allowance of 10% in respect of the chance that the plaintiff will recover somewhat and be able to undertake paid employment once more - a total of 25%.

General damages 294 These proceedings were commenced on 20 March 2001 and, accordingly, before s151G of the Workers Compensation Act 1987 in its present form applied to prohibit the award of damages for non-economic loss. The form of that section that applies to this case requires damages under this head "to be a proportion, determined according to the severity of the non-economic loss, of the maximum amount which may be awarded…in a most extreme case", that amount being $204,000: s151G(2) and (3). 295 The plaintiff has suffered serious psychological injury. Accepting, as I do, Dr Butler's opinion about the aetiology of the plaintiff's illness, that injury was present since at least November or December 1996. It was as at this date that the plaintiff's action for negligence crystallized. It is for the psychological injury that he is to be compensated. Accordingly, I do not see that it is possible for damages to be awarded under this particular head for the suffering that he undoubtedly underwent to this point, the cumulative effect of which caused the injury. 296 At the same time, the infliction of that conduct in the workplace was in breach of the plaintiff's contract of employment with Group 4 and it seems to me that he is entitled to compensatory damages of a non-economic kind for these breaches. Division 3 of Part 5 of the Act applies "to an award of damages in respect of…an injury to a worker…caused by the negligence or other tort of the worker's employer even though the damages are recovered in an action for breach of contract or in any other action": s151E(1)and (3). Accordingly, it seems to me that s 151G does not apply to damages for breaches of a contract of employment where the damages are awarded for suffering falling short of the compensable injury. To use the metaphor previously mentioned, the Division seems to me to apply to the death but not to damages for the preceding thousand cuts, however painful they might have been, because the "cuts", being to the plaintiff's psyche only, are not compensable without resulting psychological illness. 297 This issue was not the subject of specific submissions by the parties and I do not think that I should determine it in the absence of giving them an opportunity to do so. It is obvious from my account of Mr Chaloner's "internal" misconduct - which excluded the sexual assaults - that the breaches were unremitting and represented a serious interference with the plaintiff's work satisfaction as well as causing undue and continuous anxiety and pain. If the tentative view expressed by me is correct, I would award the sum of $150,000 under this head in respect of over four years of malicious mistreatment at Mr Chaloner's hands. However, I will first give the parties the opportunity to address this aspect of the case. 298 News was not the plaintiff's employer and is not liable for breach of any contract of employment. 299 In respect of general damages, I note that the plaintiff's enjoyment of life, including his ability to undertake and enjoy worthwhile employment has been substantially, if not entirely, destroyed by his illness. He may make some recovery but it will, in all probability, be relatively slight. Associated with his depression is significant anxiety. He still feels badly demeaned and suffers from intense feelings of humiliation. His ability to enjoy his family and friends except episodically has been taken from him. He is emotionally fragile and friends are not likely to be easily made or remain long-suffering. He is physically well but will be an emotional cripple for the rest of his life. 300 Had it not been for the Act, I would have awarded general damages of $200,000. News' liability in tort to the plaintiff is unaffected by the Act (subject to the effect of s151Z). As to Group 4, this is not a most extreme case, but it is close. In respect of the liability of Group 4, I would award the sum of $150,000.

Aggravated and exemplary damages 301 I have held that News is vicariously liable for the acts of its employee, Mr Chaloner. Mr Chaloner held a senior management position within the company. I have also held that, more probably than not, Mr Paine, his superior, was made aware of at least one occasion of grossly improper conduct by Mr Chaloner. Although this latter finding does not exclude the reasonable possibility that Mr Paine was, in fact, not so informed, it seems to me that I am bound to deal with the question of damages on the basis that he was so informed. 302 In Gray v Motor Accident Commission (1998) 196 CLR 1, Gleeson CJ, McHugh, Gummow and Hayne JJ said - "[15] In considering whether to award exemplary damages, the first, if not the principal, focus of the enquiry is upon the wrongdoer, not upon the party who was wronged. (The reaction of the party who is wronged to high-handed or deliberate conduct may well be a reason for awarding aggravated damages in further compensation for the wrong done. But it is not ordinarily relevant to whether exemplary damages should be allowed.) The party wronged is entitled to whatever compensatory damages the law allows (including, if appropriate, aggravated damages). By hypothesis then, the party wronged will receive just compensation for the wrong that is suffered. If exemplary damages are awarded, they will be paid in addition to compensatory damages and, in that sense, will be a windfall in the hands of the party who was wronged. Nevertheless, they are awarded at the suit of that party and, although awarded to punish the wrongdoer and deter others from like conduct, they are not exacted by the State or paid to it. … [20] If, as we have earlier suggested, the remedy is exceptional in the sense that it arises (chiefly, if not exclusively) in cases of conscious wrongdoing in contumelious disregard of the plaintiff's rights, at least two further questions arise: are exemplary damages available where the plaintiff's claim is for damages for negligence rather than some intentional wrong, and is the award of exemplary damages a matter of right or does it depend on the exercise of a discretion informed by some identifiable criteria? … [22]… For present purposes it is enough to note two things. First, exemplary damages could not properly be awarded in a case of alleged negligence in which there was no conscious wrongdoing by the defendant. Ordinarily, then, questions of exemplary damages will not arise in most negligence cases be they motor accident or other kinds of case. But there can be cases, framed in negligence, in which the defendant can be shown to have acted consciously in contumelious disregard of the rights of the plaintiff or persons in the position of the plaintiff. Cases of an employer's failure to provide a safe system of work for employees in which it is demonstrated that the employer, well knowing of an extreme danger thus created, persisted in employing the unsafe system might, perhaps, be of that latter kind...No doubt other examples can be found." 303 It cannot seriously be maintained that Mr Chaloner's conduct does not fully justify the award of substantial exemplary damages. In light of his senior position, in which his unremitting abuse of the plaintiff occurred when he acted on behalf of his employer, I consider that it follows that News must be accountable also for the payment of such damages. If this be doubtful, it seems to me that my conclusions concerning Mr Paine's probable knowledge - though limited, but which should have led to further inquiry - lead to the same conclusion and strengthen the link between Mr Chaloner's misconduct and the corporation that employed him. After all, a corporation can only act through its agents and employees. I note that it was not sought to argue that the learning concerning the "mind of the company" that applies to criminal responsibility also applies to the liability to pay exemplary damages. I have not felt it necessary to make any findings in this regard. 304 The purpose of exemplary damages is to punish the wrongdoer and deter repetition of the wrongdoing. In my view, the gravity of Mr Chaloner's conduct was so grave and its consequences so serious that an award of $150,000 is called for. To make things clear, I have not punished News for the sexual misconduct of Mr Chaloner or for the "external" abuse. 305 In respect of Group 4, the abuse of the plaintiff occurred essentially because of the failure of the company to ensure that its employees - however junior - understood what they should do if they witnessed the kind of conduct that they saw occurring to the plaintiff at Mr Chaloner's hands. This was rather by way of omission than a contumelious disregard of the plaintiff's rights, albeit that it occurred in the workplace and the plaintiff was placed by Group 4 in practical subjection to Mr Chaloner's control. Accordingly, it seems to me that I should reject the claim for exemplary damages against Group 4. For the same reason, I would not award aggravated damages against Group 4. At all events, it seems to me that s151R of the Act prevents an award of exemplary damages against Group 4. 306 As to aggravated damages, several problems arise to which submissions have not been directed. The first arises in respect of Group 4 from the terms of 151G of the Act (as it was) and poses the question whether aggravated damages are covered by that section and, if so, to what extent. I have already decided that, at all events, I would not order Group 4 to pay aggravated damages so - to that extent - the question is hypothetical. At the same time, it seems to me that, against the risk that I may be mistaken about that conclusion, this matter needs to be considered. It might also impact upon the effect of s151Z on the ultimate contributions payable by the defendants. This is a matter of complexity upon which the assistance of counsel is necessary. 307 The second, and more fundamental, problem is posed by the decision in Hunter Area Health Service v Marchlewski & Anor [2000] NSWCA 294 in which Mason P (Stein and Heydon JJ agreeing) held (at [120]) that "the law relating to pure psychiatric injury precludes recovery of a separate component of aggravated damages to compensate for the hurt, humiliation and indignation stemming from the manner in which…[the defendant] responded to the crisis it had created". That was a case of nervous shock but, on the face of it, the principle referred to by the President applies in the present case to both defendants. 308 It seems to me that, in this respect also, I should give the parties the opportunity to make further submissions.

1. I give judgment in favour of the plaintiff against the defendants.

2. News is to pay the plaintiff $150,000 in exemplary damages.

3. Otherwise the matter is stood over for agreement or further submissions and determination as indicated.

4. I reserve the question of costs. **********

28/06/2005 - Added "Anti-Discrimination Act 1977" to the cover sheet - Paragraph(s) 184

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