Estoppel by convention is a form of estoppel founded not on a representation of fact made by a representor and acted on by a representee to his detriment, but on the conduct of relations between the parties on the basis of an agreed or assumed state of facts, which both will be estopped from denying. The existence of an estoppel based on a convention between the parties has often been recognized: Thompson v. Palmer [78]; Grundt v. Great Boulder Pty. Gold Mines Ltd [79]; Legione v. Hateley [80]; Amalgamated Investment & Property Co. Ltd (In liq.) v. Texas Commerce International Bank Ltd. [81]; Spencer Bower and Turner, Estoppel by Representation 3rd ed. (1977), pp. 157-177.
76 In Ryledar Pty Ltd v Euphoric Pty Ltd, Tobias JA with whom Mason P agreed, Campbell JA agreeing in a separate judgment, in dealing with the principles applicable to estoppel by convention, referred to Con-Stan Industries Pty Ltd v Norwich and a number of other authorities. At [196] his Honour referred with approval to the text Estoppel by Conduct and Election (2006) Sydney, Sweet & Maxwell, at 115 [8-001] where estoppel by convention is described in the following terms:
When parties make a statement of fact or of mixed fact and law the
conventional basis of their transaction … both are estopped from questioning its truth for the purposes of that transaction. Estoppels by convention can be created ad hoc, expressly, by a course of dealing, or by other acts and declarations. In such a case 'there must be some mutually manifest conduct by the parties' with the intention of affecting their legal relationship.
77 The common assumption of the parties based upon the medical reports of Dr Roberts, and Dr Kohler for HealthQuest, which were known to both of the parties, was that Ms Davies was, as a result of injury, totally incapacitated from performing both operational and other types of duties. That gave rise to the assumption that there was no capacity for her to be given alternative duties, restricted duties, or administrative duties at all relevant times up to the time of her discharge. In respect of the respondent, it was most clearly demonstrated that he relied upon that assumption when he approved the off duty benefits to Ms Davies upon her being discharged.
78 Mr Seck submitted that a conclusion in respect of the assumption could not be reached without the Court drawing an inference. However, there was uncontested evidence that at all relevant times from 2006 when Ms Davies was injured to the time of her discharge and the payment of the off duty benefits, that all parties proceeded upon the bases identified in the medical reports that she was totally incapable of performing any type of police work. No inference needs to be drawn. The assumption continued to operate between the parties post employment with respect to employment entitlements arising under the workers' compensation legislation and the Award.
79 Mr Seck submitted that the doctrine of conventional estoppel could not be applied with respect to an employment relationship and the determining of entitlements in connection with that relationship. I can find no authority for this proposition in the cases or texts to which I have referred that deal with conventional estoppel. I therefore reject the respondent's submission on conventional estoppel and conclude that if it had been necessary, similar relief could have also been granted on this basis. In my view, an estoppel by convention was created ad hoc, expressly, by a course of dealing and conduct with the intention of affecting the legal relationship between Ms Davies and the respondent.
80 Reference may now be made to the mutual obligation issue which arises from cl 9.2 of the Award, which has been set out earlier. In circumstances where Ms Davies was unfit for any form of police work (as was common ground in the proceedings), the mutual obligation requirements under the Award were not applicable to Ms Davies because of the circumstances of her medical condition. There is no evidence of the employer making an offer of any alternative position. The joint assumption of the parties which existed up until the time of termination due to the medical discharge, as the joint assessment by her medical specialist and HealthQuest, was that her condition precluded her from being able to perform any alternate, restrictive or administrative duties. Further, no relevant failure by Ms Davies under cl 9.2 was identified by the respondent. In any event, a proper reading of cl 9.2 does not provide that a failure, where proven, will disqualify an officer from receiving his or her entitlements. (See in particular, reference to "will jeopardize" in cl 9.2).
81 It is to be observed, as Mr Seck submitted, that the grant of declaratory relief is, by its very nature, discretionary. I consider that it would be inappropriate to refuse relief if found that relief was otherwise available. As to the rights of Ms Davies, particularly in light of the foregoing reasons, a case on the merits has been made out to support the making of declarations. As a matter of discretion, I see no reason to withhold relief if the jurisdiction exists to do so. There is a real controversy between the parties here concerning the right of Ms Davies to an on duty benefit under the Award. The essential question, as I have said, relates to an industrial matter as would support the making of a declaration in relation to it.
82 There is a final matter that I need to determine. Mr Seck contended that the applicant did not have standing to make the claim and had not joined Ms Davies to the proceedings, whose personal interests were affected by the proceedings. It followed, so it was submitted, that in the absence of the same parties in the compensation proceedings, being the same parties in the present proceedings, no declaration of issue estoppel could be made: Ramsay v Pigram (1967) 118 CLR 271.
83 Mr Hatcher's reply to this submission was that the respondent's contention simply misconceived the role of industrial organisations in this jurisdiction and the role they play in representing their members. Counsel relied upon the decision of Lee J in Young and Others v Public Service Board [1982] 2 NSWLR 456 where his Honour considered the question of whether there was a privity of interest between a union and its members. His Honour observed at 464:
... The only possible privity of interest between the Association and its members could be privity based on interest. An industrial union or association is, at least for the purpose of suing or being sued civilly, an entity separate from its members: Egan v Barrier Branch of the Amalgamated Miners' Association (1917) 17 SR (NSW) 243; 34 WN 129; Moore v Doyle (1969) 15 FLR 59. However, in conducting proceedings in the Industrial Commission, the association does no more than represent its members - its interest in the proceedings is the interests of its members.
In Metal Trades Employers Association v Amalgamated Engineering
Union (1935) 54 CLR 387, at pp 403, 404, Latham CJ said:
"In industrial arbitration the conception of 'parties' is extended by a doctrine of representation which is in itself associated with the idea of 'industrial disputes'. Industrial disputes are essentially group contests - there is always an industrial group on at least one side. A claim of an individual employee against his employer is not in itself an industrial dispute. If it professes to be based upon an existing right (as, for example, a contract of employment, or an award (see Mallinson v. Scottish Australian Investment Co. Ltd. ((1920) 28 CLR 66)) such a claim may give rise to litigation in the civil Courts - but it is not an industrial dispute. If a claim is made by an individual employee for some improvement in his pay or conditions of employment, the refusal of the claim by his employer may result in a personal dispute, but this in itself would not be an industrial dispute. One necessary element of an industrial dispute, as distinguished from other disputes, is the circumstance that a demand is made by or upon a group of employers or employees. Thus an industrial organization is engaged in such a dispute when it makes what may be called an industrial demand on behalf of its members, present and future. In a forensic sense the organization is the party to the dispute, though it asks for nothing for itself as an organization. In another sense, the existing members of the organization are the parties to the dispute. The object of the dispute is to obtain rights for them or to cause them to become subject to obligations. The future members of the organization, though not in existence as such, are also regarded as represented in the dispute by the organization ( Burwood Cinema Ltd. v. Australian Theatrical and Amusement Employees' Association (1925) 35 CLR 528)."
In Ramsay v Pigram (1967) 118 CLR 271, at p 299, Barwick CJ said:
"The basic requirement of a privy in interest is that the privy must claim under or through the person of whom he is said to be privy."
84 In my view, this authority demonstrates Mr Seck's argument should be rejected and I do so. Ms Davies has been heard in these proceedings through her Union, and furthermore, she has given evidence in the proceedings in the form of an affidavit which has not been contested. Clearly, the proceedings have been brought by Ms Davies' Union, at her request and with her consent and support. If the respondent still seriously contends that a technical failure has occurred in the Association omitting to join Ms Davies as a party, liberty to apply is granted for such an application to be made. The parties are directed to confer before any such application is made.
85 As Wright J President observed in Police Association of New South Wales v Commissioner of Police the grant of declaratory relief carries with it the grant of liberty to apply to seek further relief should the declaration granted not resolve the issues between the parties: see Royal Insurance Company Limited v Mylius (1926) 38 CLR 477 at 497 per Isaacs J (with whom Knox CJ and Starke J agreed) and Quin v Attorney General New South Wales (1988) 28 IR 244 at 249, 261.
86 The parties may need to consider the appropriate final form of orders in light of these reasons and the observations of Wright J. They should therefore confer with a view to either filing consent orders, or having the matter listed for argument as to the making of final orders. Should the latter situation be necessary, the matter will not be listed until the parties have exchanged their draft orders and filed written submissions in respect of the proposed orders.
Costs
87 Costs are reserved. The parties should also confer as to that matter in respect of which liberty to apply is granted.