Commissioner of Police (NSW) v Jarratt - [2003] NSWCA 326

No judgment structure available for this case.

Reported Decision:
59 NSWLR 87

Court of Appeal

CITATION: COMMISSIONER OF POLICE FOR NSW & ANOR v Jeffrey JARRATT [2003] NSWCA 326

HEARING DATE(S): 21 May 2003

JUDGMENT DATE:
11 November 2003

JUDGMENT OF: Mason P at 1; Meagher JA at 143; Santow J at 144

DECISION: Appeal upheld.

CATCHWORDS: Employment - Removal from office as Deputy Commissioner of Police without notice or clear assignment of cause - s51 Police Service Act 1990 - Crown prerogative - Dismissal at pleasure - whether duty of procedural fairness - whether breach of contract - Damages - statutory compensation - whether respondent precluded from damages claim for wrongful dismissal (D)

PARTIES :
COMMISSIONER OF POLICE FOR NSW & ANOR v Jeffrey JARRATT

FILE NUMBER(S): CA 41034/02

COUNSEL: Appellant: R C Kenzie QC/ P Ginters
Respondent: T Tobin QC/ D Campbell SC/
R Glasson

SOLICITORS: Appellant: I V Knight (Crown)
Respondent: Verekers

LOWER COURTJURISDICTION: Supreme Court - Common Law Division

LOWER COURT FILE NUMBER(S): CLD 30060/01

LOWER COURT
JUDICIAL OFFICER : Simpson J

CA 41034/2002
SC 30060/2001

MASON P
MEAGHER JA
SANTOW JA
Tuesday 11 November 2003

COMMISSIONER OF POLICE FOR NEW SOUTH WALES & Anor

v Jeffrey JARRATT

FACTS

The respondent was removed from office as Deputy Commissioner of the Police Service of NSW without notice or clear assignment of cause. The Commissioner initiated the formal steps for removal because of dissatisfaction with the respondent’s performance, although whether his dissatisfaction was justified is not an issue in these proceedings. The removal was effected in accordance with the procedures stipulated in s51 of the Police Service Act 1990 (the Act). The respondent subsequently sought and obtained compensation from the Statutory and Other Officers Remuneration Tribunal (SOORT) in accordance with s53 of the Act. He also sought and obtained declaratory relief in the Supreme Court that the removal was in breach of a duty of procedural fairness and a breach of contract. He was awarded damages and costs.

ISSUES

1. Dismissal at pleasure principle

The appellants submit that the Crown had the right to remove the respondent from his position without notice or cause, subject only to the procedures stated in s51. They rely on the common law “dismissal at pleasure” principle, which states that Crown employees hold office at the Crown’s pleasure and can be dismissed at will without any right to receive natural justice or prior notice. They submit that this prerogative is not displaced by the Act, or alternatively, that it is re-enacted in s51 itself. Simpson J held that the dismissal at pleasure principle was in “clear collision” with a more modern line of authority applying the principle of procedural fairness to administrative decisions (Annetts v McCann (1990) 170 CLR 596 at 598). Her Honour held that s51(1) of the Police Service Act, which authorised the Governor to remove the respondent from his position “at any time”, was insufficient to exclude the implication of a duty of procedural fairness stemming from Annetts.

2. Damages

Simpson J awarded the respondent substantial damages on the basis of wrongful dismissal. The appellants challenge the award of damages on the basis that s53(5) effectively barred the recovery of damages additional to statutory compensation. Alternatively, they challenge the quantum of damages calculated on the basis that the respondent had a fixed term appointment, arguing that he was always liable to removal without notice.

HELD per Mason P (Meagher JA and Santow JA agreeing), allowing the appeal:

1. It was not open to the trial judge to treat the Annetts line of cases as modifying the right of the Crown to dismiss at pleasure in the heartland of situations where (ex hypothesi) it remains available. The common law dismissal at pleasure principle is not qualified by a common law implication of procedural fairness: Kioa v West (1985) 159 CLR 550 at 620-1. [66], [79], [102]

(a) The Crown prerogative to dismiss at pleasure is sanctioned by legal authority and is capable of being exercised without prior notice of dismissal, existence or assignment of cause, or a right to a hearing: Shenton v Smith [1895] AC 229, Dunn v The Queen [1896] 1 QB 116, Ryder v Foley (1906) 4 CLR 422, Fletcher v Nott (1938) 60 CLR 55, Commonwealth v Quince (1944) 68 CLR 227, Commonwealth v Welsh (1947) 74 CLR 245, Kaye v Attorney-General for Tasmania (1956) 94 CLR 193, Marks v Commonwealth (1964) 111 CLR 549, Coutts v Commonwealth (1985) 157 CLR 91, George v Minister for Education and Youth Affairs (1989) 18 ALD 578, Kelly v Commissioner of the Department of Corrective Services (2001) 52 NSWLR 533. See also Reedman v Hoare (1959) 102 CLR 177 at 181 per Taylor J, Director-General of the Department of Corrective Services v Mitchelson (1992) 26 NSWLR 648 at 650 per Kirby P. [66], [60], [56], [84]

(b) The trial judge erred in holding that Annetts v McCann (1990) 170 CLR 59 reversed and liberalised the persuasive onus regarding the application of the dismissal at pleasure principle and in concluding that the Crown had to demonstrate that the Act excluded the rules of procedural fairness. [43], [81], [86], [97], [108]

(i) The dismissal at pleasure principle is a firmly established common law right peculiar to the Crown, based on the notion that the Crown cannot by contract hamper its freedom of action in matters which concern the welfare of the State: Barratt v Howard (1999) 165 ALR 605 at 609 [8] per Hely J. [83]

(ii) The fact that a statute regulates certain aspects of Crown service employment does not prevent the application of the dismissal at pleasure principle: Marks v Commonwealth (1964) 111 CLR 549 at 586 per Windeyer J, Fletcher v Nott (1938) 60 CLR 55 at 77, Kaye v Attorney-General for Tasmania (1956) 94 CLR 193 at 198 and 204, Coutts v Commonwealth (1985) 157 CLR 91 at 105-106, Director-General of Education v Suttling (1987) 162 CLR 427 at 436 per Kirby P. [84] - [85]

3. It was not open for the trial judge to make a declaration that the removal from office was a breach of contract. This was a fundamental misconception. [71], [75]

(a) The mere existence of a contract does not exclude the Crown’s right to dismiss at will: Reilly v The King [1934] AC 176 at 180, Kodeeswaran v Attorney-General of Ceylon [1970] AC 1111 at 1123. [73]
(b) The statute itself controlled the terms of service: Director-General of Education v Suttling (1987) 162 CLR 427 at 437-8 per Brennan J. The Act stipulated most clearly that an executive officer’s term (duration) of office was not (ie could not be) fixed by the contract of employment (s41(3); see also ss41(5), 61). [64], [70], [74]

4. The respondent’s peremptory dismissal from office did not involve any unlawful or invalid act on the part of the Executive even though removal from office occurred without notice and without affording the opportunity to debate the assigned cause. [117]

(a) The dismissal at pleasure principle is not displaced by the statutory scheme. [81] – [83], [95] – [100]

(i) Clear and unambiguous statutory language is required to displace the Crown prerogative of dismissal at pleasure: Attorney-General v De Keyser’s Royal Hotel Ltd [1920] AC 508 at 576, Barton v The Commonwealth (1974) 131 CLR 477 at 488, 501. [87]

(ii) Section 51 of the Act does not abrogate the common law power or its incidents of dismissal at pleasure merely because the power is stated in statutory form or is qualified to a degree. A statute may address or qualify an aspect of the power of dismissal without abrogating the power altogether: Coutts v Commonwealth (1985) 157 CLR 91, Kaye v Attorney-General for Tasmania (1956) 94 CLR 193 at 202, Kelly v Commissioner of the Department of Corrective Services (2001) 52 NSWLR 533, Attorney-General v De Keyser’s Royal Hotel Ltd [1920] AC 508 at 561, Ruddock v Vadarlis (2001) 110 FCR 491 at 539-541 [89] – [93], [110]

(b) Section 51 stands in the long line of provisions affirming and applying the dismissal at pleasure principle as an opportunity of last resort to the Executive in the efficient administration of a disciplined police force. [113], [138]

(i) The words of s51(1) “at any time” mean a right to remove without notice. This is the language used to explain one of the key incidents of the dismissal at pleasure principle: Ryder v Foley (1906) 4 CLR 422 at 449, Commonwealth v Quince (1944) 68 CLR 227 at 252, Marks v Commonwealth (1964) 111 CLR 549 at 586, Coutts v Commonwealth (1985) 157 CLR 91 at 104 and 105. [106] - [107]

(ii) Sections 52 and 53 of the Act are strong indicators that Parliament intended s51 to restate the Crown’s right of peremptory dismissal, conferring rights of return to the public sector and of compensation to those removed from office to ameliorate its otherwise sharp impact. [113], [114]
(iii) This case is to be distinguished from Barratt v Howard (2000) 96 FCR 428 because the power conferred upon the Governor by s51 of the Act requires no more than the confluence of three streams that contain no substantive content beyond being supportive of the removal from office. [115] – [116]

HELD

per Mason P (Meagher JA and Santow JA agreeing) in respect of the independent challenge to the award of damages:

1. The case should not have proceeded as if contractual damages were to be assessed as on a wrongful dismissal. [119]

(a) The respondent’s contract did not contain a condition of employment for a fixed term or for an indefinite period terminable only upon due notice. [76]

2. Even if the respondent’s statutory term appointment was unlawfully terminated, the principles applicable to assessment of damages for breach of contract as on a wrongful dismissal should not have been applied. [132] – [134]

(a) Unless statute creates its own cause of action sounding in damages, conduct that is invalid for administrative law reasons (including denial of procedural fairness) but is not tortious or in breach of contract does not usually sound in damages: Northern Territory of Australia v Mengel (1995) 185 CLR 307, Kruger v The Commonwealth (1997) 190 CLR 1 at 147, Dunlop v Woollahra Municipal Council [1982] AC 158, Attorney General (NSW) v Quin (1990) 170 CLR 1 at 45. [120]

(b) This case is distinguishable from Director-General of Education v Suttling (1987) 162 CLR 427. [134]

3. The SOORT award capped the respondent’s monetary entitlements stemming from his removal from office. [137] – [140]

(a) Section 53 (subs (5) in particular) of the Act reinforces the conclusion that s51 is not circumscribed in the way found by Simpson J. [138]

(i) There is no reason why s53(5)’s reference to “compensation” does not embrace any form of claim for damages for loss of office: Nelungalloo Pty Ltd v Commonwealth (1948) 75 CLR 495 at 571. [139]

(b) Section 53 precludes a claim for damages for wrongful dismissal brought by a person dismissed at pleasure from a Crown office: McKerlie v State of New South Wales (2000) NSWSC 998 per Dunford J. [140]

CA 41034/2002
SC 30060/2001

MASON P
MEAGHER JA
SANTOW JA
Tuesday 11 November 2003

COMMISSIONER OF POLICE FOR NEW SOUTH WALES & Anor

v Jeffrey JARRATT

JUDGMENT

1 MASON P: The respondent was removed from office as Deputy Commissioner of the Police Service of New South Wales, without notice or clear assignment of cause. The Governor (with the advice of the Executive Council) acted on the recommendation of the Commissioner of Police, who in turn had the approval of the Minister of Police. These procedures were stipulated in s51 of the Police Service Act 1990 (the Act). The respondent sought and obtained compensation from the Statutory and Other Officers Remuneration Tribunal (SOORT) in accordance with s53 of the Act.

2 He subsequently obtained declaratory relief from the Supreme Court that the removal was in breach of a duty of procedural fairness and in breach of contract, together with substantial damages awarded on the basis of wrongful dismissal. The appellants, being the Commissioner of Police and the State of New South Wales, appeal against these orders. They submit that s51 was validly invoked inter alia because it re-enacts the “dismissal at pleasure” principle involving Crown servants. The damages award is also challenged on various grounds, including the argument that s53(5) effectively barred the recovery of damages additional to statutory compensation. Alternatively, the quantum of damages is challenged because it was calculated on the basis that the respondent had a fixed term appointment when he was in truth always liable to removal without notice.

3 The conceptual basis of the “principle” relating to the capacity of the Crown to dismiss Crown servants “at pleasure” has been variously based upon absence of contract, treating the contract of employment as unilateral (ie binding only the Crown servant), denying the authority of a superior Crown servant to negate the principle in the particular case, a prerogative or power vested in the Crown to override Crown contracts, and a term implied in a bilateral contract (with uncertainty as to whether the implication is legal or factual). The range of legal positions reflects the different times and contexts in which the issue has arisen. It also reflects uncertainty and development in legal doctrine on the subject.

4 Some of these uncertainties are removed in the present case, because the Act is at pains to spell out the incidents of the executive officer’s service, clearly defining areas governed by statute and those governed by contract. But the Act does not purport to be a code: this area above all is not written on a blank page. The Act contemplates and allows general principles of constitutional, administrative and contract law to fill out the details.

5 The Act necessarily takes primacy. I confine myself to the provisions touching this respondent’s status. “Status” is used advisedly as a neutral expression: it will be seen that the Act speaks of “office”, “position”, “employment” and “contract of employment”.

6 Except where indicated otherwise, the following references are to the Act as it stood at the time of the Governor’s decision on 12 September 2001 to remove the respondent from office.

7 The Act established the Police Service of New South Wales (s4) which comprised the following members (s5):

(a) the Commissioner,

(b) members of the Police Service Senior Executive Service,

(c) all other police officers and administrative officers employed under the Act,

(d) temporary employees.

8 The senior police officer in the Service is the Commissioner who, subject to the direction of the Minister, is responsible for its management and control (s8(1)).

9 The respondent was a member of the Police Senior Executive Service (PSES) (see s33 and Schedule 2). The PSES is regulated by Part 5 (ss32-61).

10 As a member of the PSES, the respondent was referred to as an “executive officer” (s32) because he held one of the “positions” referred to in Schedule 2 (ss32(1), 33), being Deputy Commissioner. Schedule 2 contemplates three such positions.

11 Being a police officer (cf s12), the respondent was required to take the oath or make the affirmation of office as a police officer in accordance with the regulations (s13). (As to the oath and its history, see R v Manton (2002) 132 A Crim R 249 at 253-4.)

12 Appointment of executive officers is addressed in Division 3 (ss36-39). In the respondent’s case, it was required to be made by the Governor on the recommendation of the Commissioner (s36(1)(a)) and with the approval of the Minister (s36(2)).

13 Division 4 addresses the “employment” of executive officers. I set out its terms in full:

40 Term appointments

Subject to this Act, an executive officer holds office for such period (not exceeding 5 years) as is specified in the officer’s instrument of appointment, but is eligible (if otherwise qualified) for re-appointment.

41 Employment of executive officers to be governed by contract of employment

(1) The employment of an executive officer shall be governed by a contract of employment between the officer and the Commissioner.

(2) A contract of employment may be made before or after the appointment of the executive officer concerned.

(3) An executive officer is not appointed by, nor is an executive officer’s term of office fixed by, the contract of employment.

(4) A contract of employment may be varied at any time by a further contract between the parties.

(5) A contract of employment may not vary or exclude a provision of this Act or the regulations.

(6) The Commissioner acts for and on behalf of the Crown in any contract of employment between the officer and the Commissioner.

42 Matters regulated by contract of employment

(1) The matters to be dealt with in a contract of employment between an executive officer and the Commissioner include the following:

(a) the duties of the executive officer’s position (including performance criteria for the purpose of reviews of the officer’s performance),

(b) the monetary remuneration and employment benefits for the executive officer as referred to in Division 5 (including the nomination of the amount of the remuneration package if a range of amounts has been determined for the remuneration package),

(c) any election by the executive officer to retain a right of return to the public sector under section 52.

(2) A contract of employment may provide for any matter to be determined:

(a) by further agreement between the parties, or

(b) by further agreement between the executive officer and some other person specified in the contract, or

(c) by the Commissioner or other person or body specified in the contract.

43 Performance reviews

(1) An executive officer’s performance must be reviewed, at least annually, by the Commissioner or by some person nominated by the Commissioner.

(2) Any such review is to have regard to the agreed performance criteria for the position and any other relevant matter.

44 Industrial arbitration and legal proceedings excluded

(1) In this section, a reference to the employment of an executive officer is a reference to:

(a) the appointment of, or failure to appoint, a person to a vacant executive position, or

(b) the removal, retirement, termination of employment or other cessation of office of an executive officer, or

(c) any disciplinary proceedings or disciplinary action taken against an executive officer, or

(d) the remuneration or conditions of employment of an executive officer.

(2) The employment of an executive officer, or any matter, question or dispute relating to any such employment, is not an industrial matter for the purposes of the

(3) Subsection (2) applies whether or not any person has been appointed to a vacant executive position.

(4) Any award or industrial agreement (whether made before or after the commencement of this section) does not have effect in so far as it relates to the employment of executive officers.

(5) Subsection (4) does not prevent the regulations or other statutory instruments under this Act from applying the provisions of an award or industrial agreement to the employment of an executive officer.

(6) An appeal does not lie to GREAT in relation to the employment of an executive officer.

(7) No proceedings for an order in the nature of prohibition, certiorari or mandamus, or for a declaration or injunction or for any other relief, lie in respect of the appointment of or failure to appoint a person to a vacant executive position, the entitlement or non-entitlement of a person to be so appointed or the validity or invalidity of any such appointment.

(8) In this section,

includes any determination under section 85 and any agreement under section 86.

14 Section 44 withdraws disputes about “employment” (as defined in subsection (1)) from the reach of the Industrial Relations Act 1996 or the appellate jurisdiction of the Government and Related Employment Appeal Tribunal (GREAT). Section 44(7) is a privative clause, but excludes from its scope legal proceedings touching the removal or termination of employment of an executive officer. Accordingly, s44(7) presents no barrier to the respondent challenging the validity of his removal from office.

15 Division 5 (Remuneration of executive officers) underpins the remuneration provisions of the contract of employment.

16 Division 6 (Removal, retirement etc of executive officers) contains ss48-54.

17 Section 51 provides:

51

Removal of executive officers from office

(1) An executive officer may be removed from office at any time:

(a) by the Governor on the recommendation of the Commissioner, in the case of a Deputy Commissioner or Assistant Commissioner, or

(b) by the Commissioner, in any other case.

(1A) A recommendation referred to in subsection (1) (a) may not be submitted to the Governor except with the approval of the Minister.

(2) The Commissioner:

(a) may declare an executive officer who is removed from an executive position under subsection (1) to be an unattached officer in NSW Police, and

(b) may revoke any such declaration.

(3) While a declaration under subsection (2) remains in force, the person to whom the declaration relates:

(a) is to be regarded as an executive officer, although not holding an executive position, and

(b) is entitled to monetary remuneration and employment benefits as if the person had not been removed from his or her position.

(4) If:

(a) an executive officer is removed from an executive position under subsection (1) and a declaration is not made in relation to the officer under subsection (2), or

(b) a declaration under subsection (2) made in relation to an executive officer is revoked,

the officer ceases to be an executive officer, unless appointed to another executive position.

(5) A member of the Police Service who ceases to be an executive officer because of subsection (4) ceases to be a member of the Police Service, unless appointed to another position in the Police Service.

(6) The making of a declaration under subsection (2) in relation to an executive officer does not prevent the officer from ceasing to be an executive officer because of the completion of the officer’s term of office.

(7) This section does not prevent an executive officer being removed from office apart from this section.

18 Section 52 enables an executive officer to elect to retain a right of return to the public sector in particular circumstances. The respondent made no such election in his contract of employment. Accordingly, his rights were governed by s53 which provided:

53 Compensation where executive officer has no right to return to public sector

(1) This section applies to:

(a) an executive officer who is removed from office under section 51 and who ceases to be an executive officer as referred to in section 51 (4), or

(b) an executive officer who is otherwise removed from office (except for misbehaviour after due inquiry), or

(c) (Repealed)

(d) an executive officer who was employed in the public sector when first appointed as an executive officer, whose term of office as an executive officer expires and who is not re-appointed,

being a person who is not entitled to be engaged in the public sector under section 52.

(2) A person to whom this section applies is entitled to such compensation (if any) as the Statutory and Other Offices Remuneration Tribunal determines.

(3) The Statutory and Other Offices Remuneration Tribunal:

(a) may determine that compensation is payable for the failure to re-appoint an executive officer only if the Tribunal is satisfied that the person had a reasonable expectation of being re-appointed, and

(b) must have regard to any general directions given to the Tribunal by the Minister administering the

as to the matters to be taken into consideration when it makes determinations under this section.

(4) The maximum compensation payable is an amount equal to the person’s remuneration package for the period of 38 weeks.

(5) The person is not entitled to any other compensation for the removal or retirement from office or for the failure to re-appoint the person or to any remuneration in respect of the office for any period afterwards (except remuneration in respect of a subsequent re-appointment to the office).

(6) An executive officer who is removed from office or not re-appointed is not entitled to compensation under this section if:

(a) the person is appointed on that removal or expiry of the term of office to another executive position, and

(b) the remuneration package for the holder of that position is not less than the remuneration package for the holder of the former position.

(7) If the Statutory and Other Offices Remuneration Tribunal determines that compensation is payable under this section, it must, in its determination, specify the period to which the compensation relates.

(8) The person may not be engaged in the public sector during the period so specified, unless arrangements are made for a refund of the proportionate amount of the compensation.

19 Division 7 (General) contains ss55-61. Only s61 is presently material. It provides:

This Part prevails over any inconsistent provision of any other Act or law or of the terms of appointment of or a contract with a person.

20 The respondent had a distinguished career in the Police Service. He was sworn as a probationary constable in 1967 and thereafter progressed rapidly through the ranks.

21 On 5 February 1997 he was appointed as a Deputy Commissioner for a 3 year term with the formal title of Deputy Commissioner - Specialist Operations. On 22 January 1998, the Deputy Commissioner – Field Operations died and he assumed responsibility for her position, in addition to his own. This situation continued until 1 July 1999, when Mr Moroney was appointed as Deputy Commissioner - Specialist Operations and the respondent assumed the position of Deputy Commissioner – Field Operations. This last position of the respondent was renewed for a term of five years by the appointment of 5 February 2000, which is the subject matter of these proceedings.

22 The instrument of appointment was the Minute of the Executive Council approved by the Governor on 5 February 2000. It states the respondent’s term of office as Deputy Commissioner to be five years. Accordingly, the respondent was entitled to hold that position or office for such term, “subject to this Act” (s40).

23 Section 41 stipulates that the executive officer’s “employment … shall be governed by a contract of employment between the officer and the Commissioner”. Section 43 stipulates which matters must be regulated by the contract, and those that may be regulated by it. The respondent’s Contract of Employment was made on 28 April 2000 (cf s41(2)). It deals with the duties and responsibilities of the position (cll 6-8 and Schedule A), performance criteria and matters referable to performance review (cll 9-14 and Schedule B), remuneration (cll 15 and Schedule C) as well as other matters contemplated by s42 or otherwise appropriate for such a contract. The parties to the Contract were the Commissioner of Police and the respondent. The Commissioner acted for and on behalf of the Crown in that contract (see s41(6)).

24 Section 41(3) stipulates that an executive officer is not appointed by, nor is an executive officer’s term of office fixed by, the contract of employment. This mandate is repeated in cl 1 of the Contract.

25 Clause 5 of the Contract states that:

5. The period for which the executive officer is to hold the position (unless sooner terminated) is the period of: 5 FEBRUARY, 2000 TO 4 FEBRUARY, 2005.

This does not, however, purport to be any more than “Information About Appointment” . I would reject any attempt to treat cl 4 as having any contractual force in light of cl 1 of the Contract and s41(3) of the Act. See also ss41(5) and 61.

26 As indicated above, the Act required the respondent’s performance to be reviewed, at least annually, by the Commissioner or by some person nominated by the Commissioner. Such review was required to have regard to the agreed performance criteria for the position (as set out in the respondent’s contract of employment) and any other relevant matter (s43).

27 The respondent’s contract of employment contained the following provisions:

Performance Agreement and Review

9. The Act provides for an executive officer’s performance to be reviewed, at least annually, by the executive officer’s employer or some officer nominated by that employer. Any such review is to have regard to the agreed performance criteria for the position and any other relevant matter.

10. The performance criteria specified in Schedule B may be varied by a further contract between the executive officer and the employer.

11. The employer must give the officer at least 7 days notice in writing that a performance review is to be conducted.

12. Within one month of the conclusion of a performance review, or as soon as is practicable thereafter, the employer will prepare and send to the executive officer a written statement which sets out:

(a) the employer’s conclusions about the executive officer’s performance during the period for which performance was reviewed;

(b) any proposal by the employer to vary the performance criteria as a consequence of the performance review; and

(c) any directions given or recommendations made by the employer to the executive officer in relation to the executive officer’s future performance of the duties of the position.

13. The employer undertakes that if a performance review is not held within the time contemplated by s43 of the Act, this will not operate to the prejudice of the executive officer in any decision made by the employer in relation to the executive officer, unless the failure to hold the performance review within that time was the fault of the executive officer.

14. The employer and executive officer must, as soon as possible after the executive officer receives the written statement referred to in clause 12, attempt to come to agreement on any proposal by the employer to vary the performance criteria and on any recommendations by the employer as to the future performance of the duties of the position by the executive officer.

28 No performance review in accordance with these statutory and contractual requirements was undertaken or notified during the term of the respondent’s appointment that commenced on 5 February 2000.

29 Late on 5 September 2001 the NSW Police Media Unit issued the following media release:

DEPUTY COMMISSIONER’S CONTRACT TERMINATED

The NSW Police Commissioner, Mr Peter Ryan, said today that he had recommended to the Minister that the contract of his Deputy Commissioner, Mr Jeff Jarratt be terminated on the grounds of performance.

Mr Jarratt joined the Service in 1966 and was appointed Deputy Commissioner in January 1997, Mr Jarratt’s last date of service will be 14 October 2001.

Mr Ryan said he would not comment further. The termination has been made under the Police Service Act.

Mr Moroney, the Deputy Commissioner (Specialist Operations) will be designated the Commissioner (Field Operations). The position of Deputy Commissioner (Specialist Operations) will be filled on a rotational basis until a permanent officer is appointed.

Issued by NSW Police Media Unit (02) 9266 4200 and authorised by Commissioner P J Ryan….

30 On 6 September 2001 Commissioner Ryan wrote to the respondent in the following terms:

Dear Jeff,

I refer to my telephone conversation with you yesterday afternoon.

It is with deep regret that I confirm that I have recommended your removal from Office by the Governor with the approval of the Minister of Police, pursuant to the Police Service Act, 1990.

Arrangements will be made in relation to ancillary matters through Human Resource Service and the Service will endeavour to ensure that the process is sensitively arranged.

31 On 12 September 2001, the Administrator, acting by deputation from Her Excellency the Governor, removed the respondent from the position of Deputy Commissioner with effect from 14 October 2001. The removal was pursuant to s51 of the Act. The Executive Council Minute contains the Commissioner’s recommendation (cf s51(1)(a)) and the Minister for Police’s approval (cf s51(1A)).

32 Since the Commissioner made no declaration in accordance with s51(2)(a), and since the respondent was not appointed to another position in the Police Service, the Governor’s act had the effect that the respondent ceased to be a member of the Police Service from 14 October 2001 (see s51(4), (5)).

33 The respondent ceased performing duties for and on behalf of the Service from 14 October 2001.

34 He claimed compensation pursuant to s53(1)(a) of the Act.

35 SOORT determined that the respondent was entitled to compensation amounting to $159,175. Compensation was calculated on the basis of 38 weeks of the respondent’s remuneration package as at his last day of service (Blue 62-3, 88). This was the maximum permitted under the Act (see s53(4)). The Tribunal stated in its Report (§11):

In arriving at what the Tribunal believes to be fair and reasonable compensation in the particular circumstances of this case, it has taken into account Mr Jarratt’s period of service in the New South Wales Police Service; the unexpired period of his contract the loss of benefit of executive position which he could have otherwise expected to enjoy, the prospect of his further employment and the circumstances surrounding the termination of his contract including the amount of notice he received.

36 The Commissioner initiated the formal steps for the respondent’s removal from office because of dissatisfaction with the respondent’s performance. Whether or not his dissatisfaction was justified does not arise as an issue in the proceedings. (I leave aside the procedural fairness issue raised in this appeal.)

37 The Commissioner might have resorted to s181D of the Act which empowered him to remove a police officer from the Police Service if the Commissioner did not have confidence in the respondent’s suitability to continue as a police officer, having regard to the respondent’s competence, integrity, performance or conduct. Such procedure would have involved notice to the respondent and triggered statutory rights of review (see ss181D(3), 181E-181J). But the Commissioner was not obliged to proceed in this manner (cf s51(7) and Stateof New South Wales v Paige [2002] NSWCA 235, 115 IR 283).

38 The claim was litigated pursuant to a summons that sought declarations, damages and costs. Some of the declarations averred a termination of employment in breach of contract of employment, but the conceptual basis for the damages claim is not fully disclosed in the summons.

39 The evidence was uncontroversial and largely documentary. The oral evidence appears to have related to the respondent’s earning capacity during the balance of his “term” of employment. It has not been reproduced as part of the appeal record.

40 The issues raised by the parties were summarised by Simpson J in the following terms (Jarratt v Commissioner of Police for New South Wales & Anor (2002) 56 NSWLR 72 at 74):

5 It is the circumstances of the plaintiff’s removal from the office of Deputy Commissioner that give rise to the present proceedings. Put shortly, the plaintiff’s case is that, in the circumstances, he was entitled, before being removed from his office, to be accorded procedural fairness, that procedural fairness demanded that he be advised that his removal was under consideration, and that he be given an opportunity to be heard on whether he should or should not be removed, and to answer any specific allegations made against him; and that he received no warning that his removal was under consideration and was given no opportunity to be heard on that question; that he was not told of specific allegations nor given an opportunity to respond to any such allegations.

6. The position adopted by the defendants is stark and brutally simple. Conceding that nothing that could be classified as procedural fairness had been afforded to the plaintiff in respect of the process of his removal, the defendants contend that they were under no obligation to afford procedural fairness to him; that, pursuant to the relevant legislation, the plaintiff could be removed from office at any time, without explanation, justification or excuse; that the decision to remove him could be made capriciously, unfairly, whimsically, in bad faith, for good reason or bad or no reason at all; and that such a decision is nevertheless unassailable….

41 Simpson J observed that the defendants invoked the principle that Crown employees held office at pleasure and were dismissible at will. She held that the principle had been accepted by the High Court (most recently in Coutts v The Commonwealth of Australia (1985) 157 CLR 91) and by this Court (most recently in Kelly v The Commissioner of the Department of Corrective Services (2001) 52 NSWLR 533). Implicitly, and correctly, her Honour treated the dismissal at pleasure principle as embracing the proposition that the power to dismiss at pleasure excluded any right in the Crown servant to receive natural justice or prior notice (see at [13], [42]. See also Coutts at 94, 101-2, 105, 120-1, Kelly at 556 [52]).

42 Her Honour held that the principle was in “clear collision” (at [12]) with another, more modern line of authority as to the application of the principle of procedural fairness to administrative decisions stated in Annetts v McCann (1990) 170 CLR 596 at 598. Nevertheless, she recognised that a single judge could not declare that the general principles stated in the procedural fairness cases encompassed those cases which have, “by tradition”, been held to exclude those rules (at [13]).

43 Having ruled this line in the sand, her Honour stepped over it by recognising (correctly) that the dismissal at pleasure principle was subject to statutory modification and holding (debatably) that Annetts reversed and liberalised the persuasive onus as to the application of the dismissal at pleasure principle. She concluded that it was now for the Crown to demonstrate that the Act excluded the rules of procedural fairness (see at [14], [29], [42]). The appellants submit that this was a central error in the primary judge’s reasoning.

44 The statutory and contractual framework was then considered in detail. Her Honour found (at [18]) that no performance review as required by s43 had taken place in the period of more than a year between the respondent’s appointment in February 2000 and his removal from office. This finding is not challenged in the appeal, but there was much debate about its relevance. On this topic, Simpson J said:

31 Counsel for the plaintiff placed equally heavy reliance on s43, which requires annual review of an executive officer's performance. If that annual review is to be regarded as a necessary prerequisite to the removal of an officer such as the plaintiff, then it cannot be gainsaid that, the performance review not having taken place, the removal was unlawful. However, I do not understand counsel for the plaintiff so much to be arguing that the performance review was a necessary prerequisite to removal, as to be arguing that the requirement of an annual performance review is to be taken as an indicator that the legislature intended the rules of procedural fairness to apply and be observed before employment or an appointment is brought to an end.

32 At least where the termination of employment/ appointment is performance based, this proposition has, at least initially, some attraction. So, too, does the response made on behalf of the defendants. That response was a reminder of the context in which Crown employees are engaged and operate, and the need for Crown employers to be able to manage the business of government in the most economical and efficient way, and in accordance with current policy. It may be that a restructure of the organisation deemed necessary or desirable would render some officers redundant, thus justifying the exercise of the s51 removal power for reasons entirely extraneous to performance. In such a case the s43 requirement of annual performance review would not suggest that procedural fairness should be afforded. (Nor would it suggest to the contrary - it would simply be irrelevant.) But that makes the relevance of s43 to the question whether, as a general proposition, the Act requires procedural fairness before the termination of an appointment, somewhat tenuous. It may be that procedural fairness is required in some circumstances (for example, where the motivation for the termination lies, as here, in an adverse view of the officer's performance) but not in others (for example, where the motivation for the termination lies in an intention to restructure the organisation). There are certainly stronger grounds for considering that procedural fairness is required where the explanation for the termination lies in an adverse view of performance, than where the explanation lies in policy or structural matters, but, as a matter of construction, I do not think a distinction can too readily be drawn between termination for certain reasons and termination for other reasons. If, on the true construction of the Act, procedural fairness is required before termination, it could be expected that that requirement be across the board. Of course, what is required by the application of procedural fairness may vary considerably - where a policy decision, as distinct from performance, necessitates removal, there may be little that is demanded by way of according procedural fairness. The distinction lies in the content, not the requirement, of procedural fairness.

45 Her Honour held that s51(1), which authorised the Governor to remove the respondent from his position “at any time”, was insufficient to exclude the implication of a duty of procedural fairness stemming from Annetts. This conclusion (at [29]) demonstrates that her Honour applied the liberalised, reversed onus principle she had earlier propounded.

46 The crux of her Honour’s reasoning is in the following passage (at 84-5):

43 In my opinion, the recourse had by the defendants to early authority concerning the entitlement of the Crown to act in relation to its employees or appointees in the high-handed manner for which they contend is, in the twenty-first century, and in the light of modern authority, misplaced. The focus in the Act on merit as the basis of appointment, and the requirement of annual performance reviews, support that view. That conclusion is the more acceptable because the basis for the recommendation for the plaintiff’s removal was specifically to do with the manner in which he performed his duties. It was not to do with the general structure of the Police Service or policy decisions in relation to that service. The plaintiff was entitled, not only to the benefit of a review of his performance in accordance with s43, but also, when his removal was being contemplated on performance grounds, to be notified of that fact and given an opportunity to respond to the proposal and the criticisms of his performance. Further, he was entitled to be advised of any specific allegations against him, and to the content of any adverse report, and to be given an opportunity to respond to those.

44 He was denied each of those opportunities. The decision of the Commissioner to recommend to the Governor that the plaintiff be removed from his office was legally flawed and is invalid….

48 It follows from the conclusion above that the plaintiff is entitled to orders to the effect of those claimed in paragraphs 1, 2, 3, and/or 4 of the Further Amended Summons….

47 Paragraphs 1 to 4 of the Summons were prayers for declarations. The reasons summarised above explain the declaratory relief later awarded by Simpson J in the following terms:

1. DECLARE that the order of the Governor in Council made on 12 September 2001 removing the Plaintiff from his office as Deputy Commissioner of the New South Wales Police Service with effect from 14 October 2001 was contrary to the requirements of the

and consequently invalid.

…

3. DECLARE that the decision made by the First Defendant on or before 6 September 2001 to make a recommendation to the Governor that the Plaintiff should be removed from his office as Deputy Commissioner of the New South Wales Police Service was contrary to the requirements of the

and consequently invalid.

4. DECLARE that the First Defendant in making a recommendation to the Governor, that the Plaintiff should be removed from his office as Deputy Commissioner of the NSW Police Service, failed to accord to the Plaintiff procedural fairness thus rendering the decisions to terminate the plaintiff’s contract of employment and to remove the Plaintiff from office invalid.

48 The claim for damages raised additional issues which Simpson J addressed at [49] –[61].

49 The plaintiff claimed damages “representing his salary loss for the whole of the unexpired term of his contract, less a proper allowance for sums he has been unable to earn in the meantime, the sum he was awarded by way of compensation [pursuant to s53] and a sum representing the estimate or projection of his earnings between the date of hearing and the expiration of the contract term” (at [49]).

50 The defendants submitted that the only compensation payable was that which had been awarded by SOORT (cf s53(5)). The submission was rejected (at [52]) on the basis that s53(5) presupposed a valid removal. It was not argued that, by making his application to SOORT, the plaintiff had forfeited his right to challenge his removal.

51 The defendants alternatively submitted that the plaintiff should not be compensated for the entire unexpired portion of the contract, but should be awarded damages on the basis that he was entitled to a reasonable period of notice of his removal from office. The defendants relied upon Rankin v Marine Power International Pty Ltd [2001] VSC 150, 107 IR 117. Simpson J rejected this submission (see at 87 [55]-[57]).

52 Turning to the facts, her Honour found that the respondent had made reasonable but unsuccessful attempts to mitigate his losses by obtaining alternative employment. She awarded him damages representing “the unexpired term of his contract” (at [61]), less the sum awarded by SOORT, less unspecified but minor “reductions for actual or projected earnings”, apparently those stemming from the limited work obtained to date (cf [58]) and possibly some allowance for the future. The parties were able to agree on the calculations and judgment for $642,936.35 was later awarded and entered. Simpson J also made a declaration relating to the contract, in the following terms:

2. DECLARE that in terminating the Plaintiff’s contract of employment dated 28 April 2000, between the Plaintiff as Deputy Commissioner of the New South Wales Police Service and the First Defendant, the First Defendant acted contrary to the requirements of the

and in breach of that contract.

53 It was common ground at trial that damages were to be assessed according to the principles governing an award of damages for wrongful dismissal.

54 The factual conclusions as to quantum of damages are not challenged on appeal. The appellants confined their attack in that field to the rejection of the principle stated in Rankin.

55 At the heart of the appeal is the submission that the Crown had the right to remove the respondent from his position without notice or cause, subject only to the procedures stated in s51. This was said to be a right or prerogative of the Crown which the Act had not displaced, or alternatively to be an aspect of the power conferred by s51 itself.

56 The appellants cited Shenton v Smith [1895] AC 229, Dunn v The Queen [1896] 1 QB 116, Ryder v Foley (1906) 4 CLR 422, Fletcher v Nott (1938) 60 CLR 55, Commonwealth v Quince (1944) 68 CLR 227, Commonwealth v Welsh (1947) 74 CLR 245, Kaye v Attorney-General for Tasmania (1956) 94 CLR 193, Marks v Commonwealth (1964) 111 CLR 549, Coutts v Commonwealth (1985) 157 CLR 91, George v Minister for Education and Youth Affairs (1989) 18 ALD 578 and Kelly v Commissioner of the Department of Corrective Services (2001) 52 NSWLR 533.

57 These cases attest to a common law principle that the Crown may dismiss a Crown servant “at pleasure” in some circumstances (hereafter “the dismissal at pleasure principle” or “the principle”). The juridical nature of this right is elusive and the principle has been challenged in recent years by academic writers, notably Professor Hogg.

58 Jordan CJ summarised the authorities in Browne v Commissioner for Railways (1935) 36 SR(NSW) 21 at 24:

At common law, where the Crown is the employer, and the office is not an ancient office with special incidents, the employment, whether it be permanent or temporary, is during pleasure only, and the Crown servant may be dismissed at any time without notice:

Shenton v Smith

([1895] AC 229 at pp234-5);

Dunn v The Queen

([1896] 1 QB 116);

Carey v The Commonwealth

(30 CLR 132); or may be temporarily suspended from his office:

Hunkin v Siebert

(51 CLR 538 at pp541-2). This right in the Crown exists, notwithstanding any provision in the contract of employment to the contrary:

Hales v R

(34 TLR 341, 589);

Denning v Secretary of State for India

(37 TLR 138); unless, in a particular case, it is excluded by Statute. Such exclusion may be implied where a Statute prescribes special conditions for dismissal:

Gould v Stuart

([1896] AC 575);

Young v Waller

([1898] AC 661);

Le Leu v The Commonwealth

(29 CLR 305 at 311);

Reilly v The King

([1934] AC 176); or suspension:

Hunkin v Siebert

(51 CLR 538 at pp541-2), as the case may be.

59 In Australian law the dismissal at pleasure principle has been frequently applied to police officers, precluding recovery of contractually-based damages for work yet to be performed (ie damages for wrongful dismissal), as distinct from emoluments earned for past service (Power v The Queen [1873] 4 AJR 144, Green v The Queen [1891] 17 VLR 329, Ryder v Foley (1906) 4 CLR 422, Fletcher v Nott (1938) 60 CLR 55, Bertrand v The King [1949] VLR 49, Kaye v Attorney-General (Tas) (1956) 94 CLR 193, Reedman v Hoare (1959) 102 CLR 177. See also Power v The King [1929] NZLR 267.

60 In Kelly, Heydon JA (with whom Giles JA agreed on this matter) said (at 555-7)

49 On one view of the common law Crown prerogative to dismiss at pleasure, it has the following characteristics:

(a) no prior notice of dismissal need be given ( Re Tufnell (1876) 3 Ch D 164 at 173; Kaye v Attorney-General for Tasmania (1956) 94 CLR 193 at 203);

(b) no cause for dismissal need exist or be assigned ( Re Tufnell (1876) 3 Ch D 164 at 173) or established ( Shenton v Smith [1895] AC 229 at 235; Ryder v Foley (1906) 4 CLR 422 at 452);

(c) no right to a hearing exists ( Ryder v Foley (1906) 4 CLR 422 at 433 and 452; Ridge v Baldwin [1964] AC 40 at 65-66).

50 If that is the legal position, and a Department Head, for example, decides to recommend that an officer be dismissed under the common law Crown prerogative, the officer has no right to prior notice of that decision and no right to be heard before it is made. Yet on the appellant’s arguments the officer has a right to be notified after it is made (s 23(1)) and the officer has a full right of appeal to the Tribunal. It is unusual for the permissible and practicable bounds of controversy in an appeal to be wider than the permissible and practicable bounds of controversy in the process leading to the decision against which the appeal is brought. Normally the ambit of an appeal is either the same as the decision appealed against or narrower, depending on the nature of the appeal in question. In turn this suggests that the appellant’s contentions are compatible with the unsatisfactory outcome that the right of appeal can be rendered almost nugatory by the Crown. In contrast, the first respondent’s position has at least the merit of internal consistency: the relevant officers have no rights of appeal, but they also have no rights before the taking of a decision to recommend dismissal either. The Crown might seek to render the right of appeal nugatory by choosing not to reveal whether it has any particular reason for the recommendation for the dismissal, and, if it has one, what it is. If the Crown adopts that course, it might be thought that there is little that the officer can say during the appeal. Section 42(1) of the GREAT Act provides that “the employer’s case shall be presented first”. And the employer is entitled to say no more than that the power to dismiss at pleasure is relied on. The point is that if an appeal is futile, and there are competing possible constructions of the legislation said to grant the right of appeal, the futility of the appeal will point against the construction that is relied on to give the right of appeal. As Kirby P said in Director-General of the Department of Corrective Services v Mitchelson (1992) 26 NSWLR 648 at 658: “it will generally be imputed to Parliament that it did not intend … consequences … which are … apparently irrational …”.

51 The appellant attempted to meet this difficulty by contending that in truth the common law Crown prerogative as it stood in 1884 has been greatly modified by the course of decisions since then. The appellant pointed to the duty to give natural justice recognised where there is a legitimate expectation that a licence will continue or be renewed:

FAI Insurances Ltd v Winneke

(1982) 151 CLR 342. The appellant suggested that by analogy where a Department Head was in the course of deciding to recommend to the Governor that an officer be dismissed, that officer had a right to a hearing. The appellant pointed to

Malloch v Aberdeen Corporation

[1971] 2 All ER 1278 as recognising a right in a servant capable of being dismissed at pleasure to put a contrary case. The appellant submitted that executive action was not immune from judicial review merely because it was carried out in pursuance of a common law prerogative power:

R v Toohey; ex parte Northern Land Council

(1981) 151 CLR 170;

Council of Civil Service Unions v Minister for the Civil Service

[1985] AC 374;

Minister for Arts, Heritage and Environment v Peko-Wallsend Ltd

(1987) 75 ALR 218 at 223-4, 226-7 and 248-9. The appellant might have relied on

Morrison v Abernethy School Board

(1876) 3 R 945 at 964, where Lord Moncrieff LJC said:

“We are compelled to resort to the common law to ascertain what are the incidents of a tenure at pleasure. I think that a tenure at pleasure, while it implies the right of the employer to dismiss the employed at any time without reason assigned lays upon him an obligation either to give reasonable notice or compensation in lieu of notice.”

In Malloch v Aberdeen Corporation no member of the House of Lords disagreed. Lord Guest specifically approved the observation at 1291, as did Lord Wilberforce at 1296 and Lord Simon of Glaisdale at 1298.

52 However, no authority binding on this Court has overruled authorities which are binding on this Court and which compel it to hold that an officer in respect of whom a decision to recommend that the Governor dismiss him is made is not owed a duty to receive natural justice, or prior notice. Morrison v Abernethy School Board and Malloch v Aberdeen Corporation are Scottish decisions, and each is based on implications from relevant statutes. It does not follow from the fact that some decisions based on common law prerogative powers have been held to import a duty to give natural justice that all decisions on common law prerogative powers attract that duty. It does not follow from the fact that some persons having a legitimate expectation that a state of affairs will continue must be given a hearing that Crown servants either can have that expectation or must be given a hearing. The public policy pointing to the contrary can produce harsh results, but the cases sanction both it and them.

53 However, the contention that the Crown can render an appeal nugatory is exaggerated. Despite the weak position officers are in if a decision to recommend dismissal by the Governor is to be or has been made and if it is decided to extend to those officers their rights and no more, usually the practical position of the officers will be superior to that. Neither before 1884 nor now are officers dismissed merely because they have “red hair”, to use Brereton J’s example in

Ex parte Wurth; re Tully

(1954) 55 SR (NSW) 47 at 61. It is common to justify the Crown’s prerogative by reference to factors requiring dismissal for reasons unconnected with the fitness of particular officers (such as the need to reduce staff or the loss of parliamentary supply in

Power v R

(1873) 4 AJR 141 at 145, approved by Barton J in

Ryder v Foley

(1906) 4 CLR 422 at 441). Similarly, particular officers are commonly given a reason for their dismissal.

61 This passage was obiter as regards exposition of the dismissal at pleasure principle, because Kelly involved the separate issue whether the statutory right of appeal under s24(1) of Government and Related Employees Tribunal Act 1980 was available to an employee recommended for dismissal by the Governor under the dismissal at pleasure power expressly reserved by s54 of the Public Sector Management Act 1988. Although the discussion about the principle was not an essential part of the Court’s reasoning, it is entitled to the highest respect, even with its unexplained antipathy to “Scottish decisions”.

62 The following propositions emerge from Heydon JA’s analysis:

1) the Crown’s right is described as a prerogative;

2) it is an incident of that right that the officer concerned is not owed a duty to receive prior notice or hearing, nor need cause for dismissal exist or be assigned;

3) the right is usually exercised by the Crown with less brutality than its legal incidents permit and this is a practical qualification that in one sense justifies the continued existence of the principle;

63 The respondent supported the reasoning of the primary judge. He referred to statements describing the principle as “exceptional, perhaps anachronistic” (Coutts at 105 per Brennan J) and “doctrinally erroneous and … the cause of blatant injustice” (Suttling v Director-General of Education (1985) 3 NSWLR 427 at 447 per McHugh JA, Glass JA agreeing). The Court was reminded of the strong statements by the High Court in Kioa v West (1985) 159 CLR 550 at 584 (at 584), Annetts (at 598) and Ainsworthv Criminal Justice Commission (1992) 175 CLR 564 at 576, 592 about the need for plain words of necessary intendment before the rules of natural justice will be excluded from regulating the exercise of a statutory power to destroy, defeat or prejudice rights. A decision to terminate employment is obviously significant in its adverse impacts on the employee.

64 The respondent buttressed these submissions by contending that there is “great” and “blatant injustice” when the Crown terminates a contract of employment summarily, without notice or reason. But this branch of his argument is at best circular, because (as I shall demonstrate) the respondent’s contractual rights never guaranteed any fixed term of employment. McHugh JA’s remarks in Suttling were made in the context of addressing an argument that the dismissal at pleasure doctrine might be used to override a contract for a fixed term that was relevantly unqualified by statute. The respondent’s policy arguments also overlook the significant inroads on the harshness of the principle wrought by the countervailing rights to return to other public sector employment in certain cases (s52) and to compensation (s53).

65 This branch of the respondent’s arguments cannot be accepted in light of the unbroken stream of High Court authority to the contrary, which amply supports Heydon JA’s summation in Kelly.

66 The right of dismissal is sanctioned by the cases cited by the appellants and it is capable of exercise with the curt rigour adverted to by Heydon JA. See also Reedman v Hoare (1959) 102 CLR 177 at 181 (Taylor J), Coutts at 101-2 (Wilson J), Director-General of the Department of Corrective Services v Mitchelson (1992) 26 NSWLR 648 at 650 (Kirby P). It was not open to Simpson J to treat the Annetts line of cases as modifying the right in the heartland of situations where (ex hypothesi) it remains available. Her Honour should, in my view, have held to the position stated earlier in her reasons, to the effect that (unless the High court decides otherwise), the common law dismissal at pleasure principle is not qualified by a common law implication of procedural fairness. In this regard, see also Kioa v West (1985) 159 CLR 550 at 620-1 where Brennan J expressly recognised that Coutts was a principled exception to the general implication of the principles of natural justice. See also Sanders v Snell (1998) 196 CLR 329 at 347 [44] where the point is reserved.

67 Professor Enid Campbell has suggested that Australian law might conceivably move in a different direction (Enid Campbell, “Termination of Appointments to Public Offices” (1996) 24 Fed L Rev 1 at pp20-26). Only the High Court could take such a step having regard to its earlier decisions to the contrary.

68 The dismissal at pleasure principle is curious and anachronistic when viewed in relation to contract law. In that context it rests upon shifting sands, some of which are now discarded assumptions. It is hardly surprising that it has been severely criticised by scholars and jurists (G Nettheim, “Dunn v The Queen Revisited” [1975] 34 Cam LJ 253, E Campbell, op cit, Wade & Forsyth, Administrative Law 8th ed, 2000 pp67-71, Craig, Administrative Law 3rd ed, 1994 pp707-710, Suttling v Director-General of Education (1985) 3 NSWLR 427 at 444-8 (McHugh JA)). The Canadian Supreme Court has adopted the views of Professor Hogg (in his first edition of Liability of the Crown) and abrogated the principle, holding the Crown liable under general contractual principles, except in the case of judges, Ministers of the Crown and others who fulfil “constitutionally defined state roles” (Wells v Newfoundland [1999] 3 SCR 199 at 213. See generally Nova Scotia Government Employees Association v Civil Service Commission of Nova Scotia [1981] 1 SCR 211.).

112 This statutory scheme was held to import a requirement of procedural fairness. The matter was not in issue before the Full Court and it turned, in part, upon the requirement that the Prime Minister receive (and implicitly consider) a written report about the taking of adverse action (see at 443-5). Some of the reasoning in this passage, and in the judgment at first instance of Hely J (165 ALR 605 at 613-616), provides a level of support for the respondent’s argument that the dismissal at pleasure principle cannot overreach the near-universal obligation of procedural fairness as a prerequisite to the exercise of statutory powers having significant and particular adverse impact upon individuals.

113 I have not overlooked these passages in relation to my respectful disagreement with Simpson J as regards the application of Annetts. Without, I trust, being circular in my reasoning, I cannot detect the same intensity of indicators in s51 supporting the direct implication of a duty of procedural fairness. Conversely, s51 strikes me as standing in the long line of provisions affirming and applying the dismissal at pleasure principle as an opportunity of last resort to the Executive in the efficient administration of a disciplined police force. The words “at any time” suggest this. So too does the fact that Parliament has seen fit to ameliorate the impact of summary dismissal by conferring rights of return to public sector employment and of compensation (ss52, 53) upon those removed from office by the sharp hand of s51.

114 Section 53(5) declares that the person to whom the section applies (ie the one entitled to such compensation as SOORT determines) is not entitled to any other compensation for the removal from office or to any remuneration in respect of the office for any period after the removal (except remuneration in respect of a subsequent re-appointment to the office). In light of this emphatic language it is difficult to see the basis upon which damages were sought and awarded in the respondent’s favour (cf Suttling (1985) 3 NSWLR 427 at 450-1 per McHugh JA). I address this issue below. Simpson J held that this preclusion did not apply because the removal was not valid under s51 (see her reasons at 86 [51]-[52]). Let that be accepted, for the moment and for argument’s sake. Sections 52 and 53 (s53(5) in particular) are strong indicators that s51 is intended to restate the Crown’s right of peremptory dismissal, while providing statutory modification of its otherwise harsh impact.

115 The main thrust of the appeal in Barratt related to the grounds upon which the Prime Minister could recommend the termination of a fixed term appointment to the Governor-General. The Full Court held that the statutory requirement conditioning the Prime Minister’s power upon consideration of a report supported an implication that the recommendation could only be made upon substantively limited grounds. Accordingly, fixed term appointments were not held at pleasure (see (2000) 96 FCR at 448 [71]-[73]). Once again, s51 does not imply a similar limitation (contrast the Commissioner’s power under s181D). Section 51 is not posited upon proven misbehaviour (cf s53(1)(b)). Removal may be effected “at any time”.

116 In the section that was considered in Barratt, the substantive advice capable of being given to the Governor-General by the Executive Council is controlled by the requirement that it be consistent with the Prime Minister’s recommendation, which in turn has statutory preconditions (s37(11) and (12)). By contrast, the power conferred upon the Governor by s51 of the Act requires no more than the confluence of three streams that contain no substantive content beyond being supportive of the removal from office (ie the advice of the Executive Council, the recommendation of the Commissioner and the submission of that recommendation to the Governor by the Minister for Police).

117 I would for these reasons set aside the remaining declarations and orders made by Simpson J. The respondent’s peremptory dismissal from office did not involve any unlawful or invalid act on the part of the Executive even though removal from office occurred without notice and without affording the opportunity to debate the assigned cause.

118 In case I be wrong I address separately the first of the appellants’ challenges to the award of damages as on a wrongful dismissal. Those damages were awarded in addition to the compensation awarded in the SOORT determination pursuant to s53 which in turn proceeded from the respondent’s removal from office (cf s53(1)(a)).

119 I have already indicated why such damages were not available as on a breach of contract. But if, contrary to my views, the respondent’s statutory term appointment was not lawfully terminated, was he nevertheless entitled to similarly quantified damages? And did s53(5) preclude such an award?

120 Unless statute creates its own cause of action sounding in damages, conduct that is invalid for administrative law reasons (including denial of procedural fairness) but is not tortious or in breach of contract does not usually sound in damages (Northern Territory of Australia v Mengel (1995) 185 CLR 307; Kruger v The Commonwealth (1997) 190 CLR 1 at 147; Dunlop v Woollahra Municipal Council [1982] AC 158). As Deane J put it in Attorney General (NSW) v Quin (1990) 170 CLR 1 at 45:

The law has not recognized a cause of action for damages for denial of procedural fairness in the exercise of statutory or prerogative powers. Curial relief, in the case of a denial of procedural fairness, is ordinarily confined to a declaratory order that the relevant exercise of power or authority is invalid and to ancillary relief to prevent effect being given to it.

121 Section 40 effectively confers on an executive officer the right to hold office for the period (not exceeding five years) that is specified in the officer’s instrument of appointment. Such right is however “subject to this Act” (ibid). The respondent submits that the consequence of unlawful removal from office by purported reliance on s51 is a right to damages assessed as on a wrongful dismissal.

122 The respondent cites Geddes v Magrath: Morgan v Geddes (1933) 50 CLR 520 and Director-General of Education v Suttling (1987) 162 CLR 427 (Suttling’s Case).

123 Geddes is analysed by Brennan J in Suttling’s Case at 444-5. Magrath held office as a Deputy Industrial Commissioner for five years under the Industrial Arbitration (Amendment) Act 1926 (NSW). Morgan was a chairman of a conciliation committee appointed under the same Act. Both men had been appointed to office for a five year term by the Governor, but it was only in Magrath’s case that the Governor had statutory authority to fix the term of the appointment. Both offices were abolished by a statute which conferred a right to compensation for loss of office on the office holders. Compensation was to be assessed as though the holder had been unlawfully deprived of office. Geddes did not involve a contract of service with the Crown amenable to the dismissal at pleasure principle (see per Starke and Dixon JJ at 532-3). Both Magrath and Morgan were, in the words of Starke and Dixon at 534 “independent persons occupying a public office to which rights and duties were assigned by law, not by contract”. There was no question of invalidity touching their dismissal and they had an express right to compensation. Geddes therefore casts no useful light on the current appeal.

124 Suttling’s Case is more in point, but its precise application to the present situation is not easy to discern. Mr Suttling was an officer of the Education Teaching Service established under the Education Commission Act 1980. He had been appointed to a temporary position on secondment for a fixed term at a higher salary than that which he normally received. During that term, the government closed the establishment to which he was seconded. He sued for the loss of the higher salary. His claim was dismissed at first instance, but he appealed successfully to the Court of Appeal (Glass and McHugh JJA, Kirby P dissenting). The further appeal to the High Court by the Director-General, the Attorney-General and the Education Commission was dismissed.

125 The Court of Appeal made a declaration that Mr Suttling was entitled to be paid the salary and emoluments of the position from which he had been unlawfully removed.

126 The High Court rejected the contractual basis for the award that had been adopted by McHugh JA and Glass JA in this Court. Nevertheless, the appeal was dismissed.

127 The leading judgment was given by Brennan J with whom Mason CJ and Deane J concurred. Wilson and Dawson JJ dissented.

128 Brennan J stated the critical issues to be whether Mr Suttling’s appointment had conferred an enforceable right to the salary of the higher, temporary position; and, if so, whether the premature termination of the appointment was valid (see at 437).

129 Reversing the Court of Appeal, Brennan J held in effect that Suttling’s rights were statutory. They stemmed from his appointment to serve in the higher position temporarily, albeit for a fixed period. The Director-General had statutory authority to make such an appointment and to fix its period (at 439-40). It followed that (at 439-440):

Whether that appointment be treated as contractual or as merely statutory, it is to be presumed that it was validly made and that Mr Suttling became entitled to the rights which flowed from it. That is to say, he was entitled to the conditions of employment determined pursuant to s51(2)

.

130 As analysed in the High Court, Suttling’s Case did not involve any dismissal from service (see at 437, 442). Suttling remained an officer of the Education Teaching Service throughout. The Crown’s argument that it could fall back on the power to dismiss at pleasure was rejected on the facts (see at 442), Brennan J holding that Suttling had never been dismissed from Crown service.

131 The various arguments raised by the Crown as constituting statutory justifications for the abolition of the position and the consequential withdrawal of its benefits from Mr Suttling were considered and rejected at 441-5.

132 As indicated, Mr Suttling retained the declaration awarded by the Court of Appeal as to his entitlement to the pay of the higher position for the fixed term of his appointment to that position. The appointment conferred a statutory right to the salary and emoluments of that position. Section 91 of the Education Commission Act 1980 conferred a right to sue for salary and remuneration. In these circumstances, Brennan J said (at 440-441):

If an officer is wrongfully prevented from performing the duties of his position and thereby earning the salary specified in his conditions of employment, he is entitled to damages for wrongful dismissal: see

Williamson v The Commonwealth; McVicar v Commissioner of Railways (NSW)

. It follows that Mr Suttling had a legal right to be allowed to perform the duties of the position of Senior Education Officer Class 2 at Strathfield for the period of his appointment and thereby to earn the salary specified in his conditions of appointment unless the premature termination of the appointment was effected in exercise of some overriding power.

133 I read this as deciding that the principles applicable to assessment of damages for breach of contract as on a wrongful dismissal can apply by analogy even though the right to remain in an office or position for a fixed term is statutory and not contractual.

134 This was the way in which the parties proceeded at trial and on appeal in the present case. I am not sure that this was correct in the present case, because (a) the Act contains no presently relevant provision analogous to s91 of the Education Commission Act 1980; (b) the matter of remuneration is treated as a contractual, not a statutory right as regards the contract of employment between an executive officer and the Commissioner (see s42(1)(b) of the Act); (c) the Act confers qualified rights to return to the public sector and to compensation (ss52, 53) which strike me as incompatible with an entitlement to recover remuneration as on a wrongful dismissal; and (d) the emphatic terms of s61.

135 The appellants continue to rely on s53(5). Section 53 applies, in general terms, to an executive officer who is removed from office under s51 and who ceases to be an executive officer as referred to in s51(4) (see s53(1)(a)). The respondent was in this category. Section 53(4) stipulates the maximum “compensation” that may be determined in favour of a person to whom this section applies. Section 53(5) provides:

The person is not entitled to any other compensation for the removal or retirement from office or for the failure to re-appoint the person or to any remuneration in respect of the office for any period afterwards (except remuneration in respect of a subsequent re-appointment to the office).

136 The appellants submit that the SOORT award capped the respondent’s monetary entitlements stemming from his removal from office. Simpson J held otherwise on the basis that s53 presupposed valid removal under s51.

137 In my view her Honour was correct, in one sense. The preclusive cap found in s53(5) applies, and applies only, where there is (among other things) “removal” under s51. But s53 strikes at the heart of the respondent’s case in two other ways. First, it is in my view strongly arguable that it was not open to the respondent to invoke s53, recover compensation under it and then to challenge the validity of the very conduct invoked by him as the basis for obtaining compensation from SOORT. I strongly doubt whether this form of approbation and reprobation was available to the respondent (cf Verschures Creameries Ltd v Hull & Netherlands Steamship Co Ltd [1921] 2 KB 608, Multicon Engineering Pty Ltd v Federal Airports Corporation (1997) 47 NSWLR 631 at 646-7, VACC Insurance Co Ltd v BP Australia Ltd (1999) 47 NSWLR 716 at 724-5). However, this point was not taken and the Court did not hear full argument on it. Accordingly I pass over it.

138 The point that was taken, and which I would uphold, is that s53 (subs (5) in particular) reinforces the conclusion that s51 is not circumscribed in the way found by Simpson J. Section 51 restates the dismissal at pleasure principle, but qualifies it by the procedural requirements found in s51(1) and (1A) and mitigates its harsh impact by the provisions made in ss52 and 53.

139 I see no reason why s53(5)’s reference to “compensation” does not embrace any form of claim for damages for loss of office. It is difficult to see what else could be envisaged. As Dixon J put it in Nelungaloo Pty Ltd v Commonwealth (1948) 75 CLR 495 at 571:

Now “compensation” is a very well understood expression …. It is to place in the hands of the owner expropriated the full money equivalent of the thing of which he has been deprived. Compensation prima facie means recompense for loss, …

140 In McKerlie v State of New South Wales (2000) NSWSC 998 Dunford J construed a corresponding section in the Public Sector Management Act 1988 (s55) as precluding a claim for damages for wrongful dismissal being brought by a person dismissed at pleasure from a Crown office. I agree with this decision and would apply its reasoning to s53(5).

141 It is unnecessary to address the appellant’s argument that damages should have been assessed on the basis of an entitlement to reasonable notice and not by reference to an entitlement to a fixed period of service in office.

142 I propose the following orders:

143 MEAGHER JA: I agree with Mason P.

144 SANTOW JA: I agree with Mason P.

**********

Last Modified: 11/11/2003

Citations

Commissioner of Police for NSW v Jeffrey Jarratt [2003] NSWCA 326

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CITATION:	COMMISSIONER OF POLICE FOR NSW & ANOR v Jeffrey JARRATT [2003] NSWCA 326
HEARING DATE(S):	21 May 2003
JUDGMENT DATE:	11 November 2003
JUDGMENT OF:	Mason P at 1; Meagher JA at 143; Santow J at 144
DECISION:	Appeal upheld.
CATCHWORDS:	Employment - Removal from office as Deputy Commissioner of Police without notice or clear assignment of cause - s51 Police Service Act 1990 - Crown prerogative - Dismissal at pleasure - whether duty of procedural fairness - whether breach of contract - Damages - statutory compensation - whether respondent precluded from damages claim for wrongful dismissal (D)
PARTIES :	COMMISSIONER OF POLICE FOR NSW & ANOR v Jeffrey JARRATT
FILE NUMBER(S):	CA 41034/02
COUNSEL:	Appellant: R C Kenzie QC/ P Ginters Respondent: T Tobin QC/ D Campbell SC/ R Glasson
SOLICITORS:	Appellant: I V Knight (Crown) Respondent: Verekers

LOWER COURTJURISDICTION:	Supreme Court - Common Law Division
LOWER COURT FILE NUMBER(S):	CLD 30060/01
LOWER COURT JUDICIAL OFFICER :	Simpson J