Department of Justice - Office of Corrections v Hepburn, Valerie

[1998] FCA 467

FEDERAL COURT OF AUSTRALIA

PRACTICE AND PROCEDURE - stay of judgment - no satisfactory reason for stay order shown

Cosco Holdings Pty Ltd v Do (1997) 150 ALR 127 discussed

DEPARTMENT OF JUSTICE - OFFICE OF CORRECTIONS v VALERIE HEPBURN
VG 160 of 1998

FINKELSTEIN J
1 MAY 1998
MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	VG 160 of 1998

JUDGE:	FINKELSTEIN J
DATE OF ORDER:	1 MAY 1998
WHERE MADE:	MELBOURNE

THE COURT ORDERS THAT:

1. The application for a stay Fn the orders made on 2 April 1998 is refused.

1. The applicant pay the respondent’s costs of and incidental to the application save for        the costs of 27 April 1998 which are reserved.

Note: Settlement and entry of orders are dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	VG 160 of 1998

BETWEEN:	DEPARTMENT OF JUSTICE - OFFICE OF CORRECTIONS Applicant
AND:	VALERIE HEPBURN Respondent

JUDGE:	FINKELSTEIN J
DATE:	1 MAY 1998
PLACE:	MELBOURNE

REASONS FOR JUDGMENT

HIS HONOUR: Ms Hepburn was a prison officer employed by the Department of Corrections (Victoria) at Pentridge Prison.  On 31 May 1996 she was dismissed from her position because she had associated with a person on parole.  The dismissal followed a disciplinary enquiry under the Public Service Management Regulations 1993 (Vic).

On 13 June 1996 Ms Hepburn made application under the Industrial Relations Act 1988 (Cth) (legislation that has now been repealed) for reinstatement and compensation.  That application was heard by a Judicial Registrar of the Court and was dismissed.  Ms Hepburn then applied by way of re-hearing to a judge of the Court.  Her application was heard by Spender J in late 1997 and his Honour handed down his decision on 2 April 1988. 

By that decision his Honour declared that the termination of the employment of Ms Hepburn was in contravention of s 170DE of the Industrial Relations Act and ordered the Department to reinstate Ms Hepburn either by reappointing her to the position in which she was employed immediately before the termination or by appointing her to another position on terms and conditions no less favourable than those on which she was employed immediately before the termination.  Spender J also ordered the Department to pay to Ms Hepburn the remuneration which she lost as a result of the termination of her employment, such remuneration to be paid within 14 days of his Honour’s orders.  Liberty to apply was reserved.

Spender J found that, having regard to the evidence before him, the decision to dismiss Ms Hepburn had not been based on a genuine consideration of the circumstances of her case.  His Honour found that the decision to terminate Ms Hepburn’s employment was made in order to avoid embarrassment that might be caused to the Department.

It appears that both before the disciplinary enquiry and before Spender J Ms Hepburn conceded that she was in breach of the regulations as a consequence of her association with the person on parole.  The gravamen of her complaint was that the penalty that was imposed was unreasonable. 

His Honour found that when looked at objectively the penalty was unreasonable.  That is he was of the view that Ms Hepburn’s conduct did not justify her dismissal.  Accordingly, he found that there was no “valid reason” for her dismissal as required by the legislation.

The Department has lodged an appeal against the decision of Spender J and now seeks a stay of the orders made. 

The principles applicable on an application to stay the operation of a decision are not in doubt.  When an application is made for a stay it is necessary to demonstrate that it is appropriate for the order to be made.  Prima facie a successful party is entitled to the benefit of the judgment obtained but that is not an inflexible position.  But the circumstances may show that it is proper grant a stay.

Here the reasons put forward by the Department in support of its application for a stay are as follows: (a) the Department has good prospects of success in the appeal; (b) it would be difficult to comply with Spender J’s order for reinstatement because the prison where Ms Hepburn worked before her dismissal no longer exists; (c) there is a risk that Ms Hepburn will not be able to repay to the Department the money that she would receive if the order was complied with. 

In support of the first ground it was said that the decision of the Full Court in Cosco Holdings Pty Ltd v Do (1997) 150 ALR 127 makes it clear that the trial judge fell into error. This decision was not available to the trial judge at the time of hearing (the Full Court handed down its decision on 4 December 1997 and it was reported after his Honour published his reasons). It is not generally appropriate on an application for a stay to deal with the merits of the appeal. It is sufficient for present purposes to indicate that I have perused Spender J’s reasons for judgment and have considered (albeit briefly) the decision of the Full Court in Cosco Holdings and I do not necessarily see a conflict between them. 

Although Spender J did refer in his reasons to a number of decisions on the meaning of the expression “valid reason” for dismissal that were overruled by Cosco Holdings it is not apparent to me that his decision was dependent on the ratio of the overruled cases.  His Honour’s finding that the penalty imposed was unreasonable is capable of being justified having regard to the manner in which Cosco Holdings requires a “valid reason” to be considered.

There is little merit in the remaining two grounds.  The order of Spender J did not require Ms Hepburn to be employed in the same position that she held at the time of dismissal.  The Department is required to employ her in some other position provided it is on comparable terms and conditions.  There is no suggestion that the Department is unable to comply with that order.

Finally there is the allegation that Ms Hepburn will be unable to repay the compensation she will receive if the decision is set aside.  There is no satisfactory evidence that Ms Hepburn will not be able to repay the money if the Department is successful on the appeal.  The basis of the contention that Ms Hepburn lacks funds is one sentence in an affidavit sworn in support of the application for a stay.  The affidavit was sworn by the Director of Prison Services.  The sentence reads:

“I am of the opinion that should any monies be paid to (Ms Hepburn) in compliance with the impugned order, there is a real likelihood that if the appeal is successful (the Department) would be unable to recover those funds.“

No facts are set out to support this opinion.  It is impossible to discern why this opinion is held.  In those circumstances I am unable to act on it. 

In the result the application for a stay will be refused.

I certify that this and the preceding three (3) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Finkelstein

Associate:

Dated:            5 May 1998

Counsel for the Applicant:	PG Priest
Solicitor for the Applicant:	Woodhams O’Keeffe & Co
Counsel for the Respondent:	RRS Tracey
Solicitor for the Respondent:	Victorian Government Solicitor
Date of Hearing:	1 May 1998
Date of Judgment:	1 May 1998