Paulson v Industrial Relations Secretary

Industrial Relations Commission (NSW)|2017-11-28

Solicitors: Cardillo Gray (Appellant) Crown Solicitor (Respondent) File Number(s): 2017/233583 Decision under appeal Court or tribunal: Industrial Relations Commission of New South Wales Citation: [2017] NSWIRComm 1037 Before: Murphy C File Number(s): 2016/49498

Judgment

This is an application for leave to appeal and, if leave is granted, an appeal against the decision of Murphy C in Paulson v Industrial Relations Secretary (Department of Justice) [2017] NSWIRComm 1037 ('the impugned decision').
Commissioner Murphy found that while the dismissal of the appellant was harsh pursuant to section 84 of the Industrial Relations Act 1996 (NSW) ('the Act'), it was impracticable to order reinstatement or re-employment pursuant to section 89(1) or 89(2) of the Act. The appeal is limited to the issue of whether the Commissioner erred in declining to make such an order.
The Full Bench required the parties to address the question of leave to appeal as a preliminary issue. Having considered those submissions, the Full Bench decided to refuse leave and announced that reasons would be published in due course. Our reasons follow.

The decision at first instance

The appellant, a Sheriff's Officer, was the subject of 42 allegations of misconduct that were the subject of an investigation by the respondent. In the proceedings below, the Commissioner found that 5 of the allegations were proven. While the proven allegations were not trivial and warranted some form of disciplinary action, Commissioner Murphy considered that dismissal was harsh in the sense that 'the punishment did not fit the crime'. The Commissioner determined that reinstatement or re-employment was impracticable and awarded compensation of 13 weeks' pay.

Principles on leave to appeal

The principles in relation to the grant of leave to appeal a decision of the Commission were summarised in Public Service Association and Professional Officers Association Amalgamated Union of New South Wales v Roads and Maritime Services [2015] NSWIRComm 16. In that matter the Full Bench stated at [10] and [11]: It is well settled that an appeal under the IR Act is an appeal in the strict sense: see s 191 of the IR Act and King v State Bank of New South Wales (No 2) [2002] NSWIRComm 353; (2002) 126 IR 407. In such an appeal the appellate tribunal will only intervene to correct error: Aboud v State of New South Wales (Department of School Education) [1999] NSWIRComm 449; (1999) 92 IR 32. In the case of discretionary decisions it is not enough that the appellate tribunal would have come to a different view. It must be shown that the primary judge had failed to properly exercise the discretion committed to him: Mace v Murray [1955] HCA 2; (1955) 92 CLR 370 and House v The King [1936] HCA 40; (1936) 55 CLR 499. It is important to bear these principles in mind in approaching the question of leave to appeal. The principles guiding the determination of leave were clearly set out in this often cited passage from Hosemans v Commissioner of Police (No 4) (2005) 150 IR 263: [5] The law and practice governing leave to appeal is well settled and does not require restatement: see Knowles v Anglican Church Property Trust (No. 2) (1999) 95 IR 380. However, two principles warrant particular mention: first, leave will not be lightly or automatically granted (see King v State Bank of New South Wales (No 2) (2002) 126 IR 407 at [52]-[55] and Knowles at 381 - 382) and, subject to the requirements of s188(2) of the Act, will not, generally, be granted unless the appellant demonstrates that the appeal "raises substantial issues of principle or law or has wider implications for the jurisprudence of this Commission, including whether the decision has widespread practical application" (see Knowles at 382) or raises issues going to the proper administration of justice. Secondly, leave will rarely be granted where an appeal primarily seeks to challenge findings of fact which are otherwise reasonably open on the evidence: Box Valley Pty Ltd v Price (2000) 97 IR 484; Austin v NF Importers Pty Limited [2005] NSWIRComm 353 at [5].
These principles have since been approved in a number of decisions of the Full Bench: Merrin v Mosman Municipal Council [2016] NSWIRComm 1048 at [6]-[7]; Fire Brigades Employees' Union of NSW (o/b Challinor) v Fire and Rescue NSW [2016] NSWIRComm 1050 at [11]; Construction, Forestry, Mining and Energy Union (New South Wales Branch) v Acciona Infrastructure Australia Pty Ltd and Ferrovial Agroman (Australia Pty Ltd t/as the Pacifico Acciona Ferrovial Joint Venture [2017] NSWIRComm 1029 at [10]; and Andrew Geza Schwartz and NSW Ministry of Health [2017] NSWIRComm 1034 at [8]. There was no suggestion that they should not be applied here. We will apply them.

The grounds of the appeal

Leave to appeal was sought on the following grounds: 1. the appeal raises issues of fact and law, whereby Commissioner Murphy was misled or otherwise uninformed as to the evidence given by Ms Cindy Cannell, which was evidence that was material and significant in the finding that it was impracticable to order reinstatement or re-employment; 2. the appeal raises issues of law concerning the failure of Commissioner Murphy to apply at all the rule in Jones v Dunkel (1959) 101 CLR 298, in circumstances where such failure was material to the question of whether reinstatement or re-employment was impracticable; 3. the appeal raises issues of law concerning the failure of Commissioner Murphy in to apply at all the rule in Browne v Dunn (1893) 6 R 67, in circumstances where such failure was material to the question of whether reinstatement or re-employment was impracticable; 4. the appeal raises questions of law regarding the correct approach in determining the question of impracticality in the context of ordering reinstatement or re-employment; 5. the appeal raises questions of law regarding the extent of the considerations relevant to determining the question of impracticality in the context of ordering reinstatement or re-employment; and 6. the appeal raises questions of law regarding the proper and sufficient reasons required to justify a finding of impracticality in the context of reinstatement or re-employment.
The appellant further submitted that it was in the interests of justice for leave to be granted given the allegations of the appellant involve issues of procedural fairness at first hearing.
The appellant's Outline of Submissions on the Appeal summarised what were characterised as the Commissioner's errors as follows: 1. relying upon and giving undue weight to the oral evidence of Ms Cannell regarding the question of whether it was impracticable to order reinstatement or re-employment, in circumstances where Ms Cannell gave misleading evidence that was material to the decision not to order reinstatement or re-employment; 2. failing to draw an adverse inference in accordance with the rule in Jones v Dunkel in relation to the failure of the respondent to lead evidence at hearing from Mr Hendrickse, Mr Andrews and Ms Esler regarding whether it was impractical to order reinstatement or re-employment and, in turn, finding impracticality despite no evidence from those witnesses on that issue; 3. relying upon and giving undue weight to written statements provided by Mr Jeanes, Ms Morrow and Ms Barry that were relied upon by Ms Nix in her investigation report in determining the question of whether reinstatement or re-employment was impracticable, in circumstances where the Appellant was not given the opportunity to cross-examine them; and 4. taking into account the following irrelevant considerations: 1. that the appellant made complaints regarding the conditions of his employment within the Department of Justice and its employees, including a complaint to the Anti-Discrimination Board of NSW regarding alleged discrimination while employed within the Department; 2. the length of time between dismissal and hearing of the appellant's unfair dismissal claim; and 3. the conduct and "demeanour" of the Appellant in the witness box.
At hearing, counsel for the appellant indicated that a ground relating to an asserted failure by the Commissioner to apply the rule in Browne v Dunn was not pressed. Counsel did however seek to add an additional consideration, submitting that the Commissioner failed to take into account the appellant's total employment history or failed to disclose adequately in his reasons that he had taken it into account.

Consideration

Leave to appeal is only to be granted if the matter is of such importance that in the public interest leave should be granted. Section 188(2) of the Act limits appeals relating to discretionary decisions of the Commission to circumstances of demonstrated error, applying the principles set out in House v The King [1936] HCA 40. With this principle in mind, we turn to consider the areas of purported error identified by the appellant.

Evidence of Ms Cannell

The evidence of Ms Cannell outlined her concerns about the impracticability of reinstatement. It addressed the relationship between the appellant and his supervisors generally, referring to 'any' supervisors.
Ms Cannell advanced the opinion that if the appellant were reinstated or re-employed within the Northern Region of the Sheriff's Office there would be a re-emergence of inter-personal relationship issues with other members of staff which would be extremely destructive towards staff productivity and harmony, as well as being difficult to manage. She gave a number of reasons for this opinion, including her personal observations of the appellant. These are relevant matters that the Commissioner was entitled to take into account in the exercise of his discretion.
Ms Cannell's evidence was unchallenged by contradictory evidence and no positive evidence was adduced on behalf of the appellant that it was not impracticable to reinstate him. Ms Cannell was made available for cross-examination and was cross-examined by the appellant's counsel in the proceedings below.
It is asserted that Ms Cannell's evidence misled the Commissioner because she failed to disclose at hearing that she had been, or was about to be, made redundant. We do not see any basis for this submission. As submitted by the respondent, even if that had been the case there was no obligation to make such a disclosure as such a matter was irrelevant to the evidence she gave, which related to the appellant's relationships within the workplace more broadly.

Failure to draw adverse inference from evidence of Hendrickse, Andrews and Esler

The written submissions on leave to appeal and appeal asserted that the Commissioner failed to draw a relevant Jones v Dunkel inference against the respondent in respect of the evidence of Mr Hendrickse, Mr Andrews and Ms Esler. However, at hearing, counsel for the appellant clarified that this ground was pressed only to the extent that there was an asserted failure by Murphy C to afford fairness as between the parties.
We do not consider any unfairness arises in this regard. As the respondent submitted, each of these witnesses was made available for cross-examination and was cross-examined by the appellant's counsel after his cross-examination of Ms Cannell. No question was put on the practicability of returning the Appellant to the workplace.
The Commissioner had before him documentary and oral evidence from these three witnesses of the difficulties they experienced in their working relationships with the appellant. It was open to the Commissioner to take into account that evidence in drawing an inference that re-establishing a working relationship would be problematic, as part of his overall assessment of impracticability of reinstatement.

Weight given to written statements of other employees

The appellant's written submissions asserted that the Commissioner erred by forming the opinion that it would be difficult for a viable working relationship to be re-established between the appellant and the "other employees" who provided the respondent's investigator with information that was adverse to the appellant, namely Mr Jeanes, Ms Barry and Ms Morrow. These persons did not give evidence in the proceedings below.
It is apparent, however that it was open to the Commissioner to form that view based on the evidence given by Ms Cannell, as well as the evidence of Mr Wademan and/or Mr Kildey which was to a similar effect.
The Commissioner was required to give active consideration to the practicability of reinstatement in a common sense way, which he did by reference to the totality of the evidence before him. He did not fall into discernible error in respect of the relative weight given to particular aspects of that evidence in the exercise of his discretion.

Relevant considerations in determining impracticability

Quite apart from the allegations of misconduct that formed the basis for the termination decision, there was evidence of the appellant's inability to work with people that rendered open to the Commissioner a finding that reinstatement or re-employment was impracticable.
The Commissioner took into account the attitude of the appellant to his supervisors and his resistance to accepting remedial action implemented by them. Such attitude was evidenced in part by the appellant's complaints to the Anti‑Discrimination Board and NCAT, the underlying thesis of which was that he had been discriminated against, persecuted and treated unfairly by his supervisors. Those claims were determined by the Anti‑Discrimination Board to be unfounded. It was not the fact of a complaint that was considered but the content of the complaint. In this context, the personality issues that emerged were not irrelevant considerations in assessing impracticability, and the Commissioner was entitled to take them into account.
There was also evidence that the appellant refused to be supervised by certain persons and to work with other persons. We consider that the nature of the appellant's interpersonal relationships within the respondent's workplace was a relevant matter to be taken into account in the Commissioner's consideration of whether it was impracticable to restore the employment relationship. We similarly consider that in this context, the Commissioner's own observations of the appellant in the witness box were relevant to the exercise of his discretion regarding reinstatement, quite distinct from any issue of the appellant's credit as a witness.

Delay between dismissal and hearing of the claim

Counsel for the appellant did not submit that the delay between the dismissal and the hearing was an impermissible factor to be taken into account in the Commissioner's assessment of impracticability. Rather, it was said that the Commissioner failed to take into account the possibility that delay may have meant that some of the interpersonal relationship difficulties between the appellant, his supervisors and other employees would no longer be an issue. We note counsel did not point to any evidence to support the contention.
The personality traits that made his interpersonal relationships difficult were evident to the Commissioner in the course of the appellant's evidence. That observation suggests the issues remained current and militates against counsel's contention. Commissioner Murphy referred to these traits in the context of considering impracticability. Further, the appellant's concerns about persecution, harassment and bullying were not confined to individuals but were directed more generally to the Department, again suggesting that the attitudes were unlikely to have changed.
Moreover, the respondent submitted that in determining impracticability, the Commissioner was specifically considering reinstatement to a position of sheriff's officer in the Newcastle area. The evidence before the Commission was that a roster system was in place where all sheriff's officers were expected to be able to work with one another. We consider that in this factual context, there was no failure to take into account a relevant consideration constituting an appellable error.

Proper and sufficient reasons

The Commissioner detailed in his decision the appellant's employment history. He then turned to the allegations of misconduct. The Commissioner found certain instances of misconduct proven and determined that they were not trivial. He then turned to consider whether, notwithstanding those findings, there were mitigating circumstances which may have made the decision to dismiss harsh. While the Commissioner did not descend into detail in respect of the factors impacting upon the finding it was harsh, the structure of the decision leads us to conclude that he took into account the totality of the evidence which included the whole of the appellant's employment history.

Procedural unfairness

In the proceedings before Murphy C the parties were given the opportunity to be heard on the question of the impracticality or otherwise of reinstatement or re‑employment. The submission of counsel for the appellant before the Commissioner on the question of the practicability of reinstatement and/or re-employment was brief: "Despite the claims of Ms Cannell, in my submission, this employee could be reinstated."
Counsel for the appellant conceded, very properly, that the prosecution of the appellant's case in the proceedings below focussed on misconduct, and the issue of impracticability of reinstatement or re-employment was given little attention. As is apparent from the submissions quoted above, that was not because the Commissioner denied the appellant the opportunity to be heard on the issue, but was the result of forensic decisions made by the appellant or his representative.
The appellant has not identified any issues of procedural unfairness that justify the granting of leave in the interests of justice.

Conclusions - Leave to appeal

As the appeal challenges the exercise of a discretion, the appellant must demonstrate error in its exercise of the nature contemplated in the principles enunciated in House v The King. In our view, no such error is established.
It was for these reasons that we refused to grant leave to appeal.

Order

The Full Bench confirms its order: 1. Leave to appeal is refused. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 25 January 2018

Industrial Relations Act 1996(NSW)s 84, 89(1), 89(2)

[1999] NSWIRComm 449

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