Erlich v Leifer
[2015] VSC 499
•16 September 2015
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
MAJOR TORTS LIST
S CI 2013 01067
| HADASSA ERLICH | Plaintiff |
| v | |
| MALKA LEIFER ADASS ISRAEL SCHOOL INC | First Defendant Second Defendant |
---
JUDGE: | RUSH J |
WHERE HELD: | Melbourne |
DATES OF HEARING: | 5, 6, 7, 8, 11, 12, 13 and 15 May 2015 |
DATE OF JUDGMENT: | 16 September 2015 |
CASE MAY BE CITED AS: | Erlich v Leifer & Anor |
MEDIUM NEUTRAL CITATION: | [2015] VSC 499 |
---
NEGLIGENCE – Claim for psychiatric injury sustained as a result of the sexual abuse of the plaintiff by the first defendant – Nature of the duty of care –Direct and vicarious liability – Whether the second defendant breached the duty of care owed to the plaintiff – Causation of damage – Extent that plaintiff’s injury is attributable to the period when the plaintiff attended the premises of the second defendant as a student – Nationwide News Pty Ltd v Naidu & Anor; ISS Security Pty Ltd v Naidu & Anor (2007) 71 NSWLR 471 – Tesco Supermarkets Ltd v Nattrass [1972] AC 153 – Christian Youth Camps Ltd v Cobraw Community Health Services Ltd (2014) 308 ALR 615 – Meridian Global Funds Management Asia Ltd v Securities Commission [1995] 1 AC 500 – Lennard’s Carrying Co Ltd v Asiatic Petroleum Co Ltd [1915] AC 705 – Director of Public Prosecutions Reference No. 1 of 1996 [1998] 3 VR 352 – Hawkins v Clayton (1986) 5 NSWLR 109 – Beach Petroleum NL v Johnson (1993) 115 ALR 411 – State of New South Wales v Lepore [2003] 212 CLR 511 – Sprod v Public Relations Orientated Security Pty Ltd [2007] NSWCA 319 – Blake v JR Perry Nominees Pty Ltd (2012) 38 VR 123 – Withyman v State of New South Wales and Blackburn [2013] NSWCA 10 – A, DC v Prince Alfred College Incorporated [2015] SASC 12.
DAMAGES – Damages awarded for pain and suffering, loss of enjoyment of life, economic loss and medical expenses – Claim for aggravated and exemplary damages – Exemplary damages awarded against the first and second defendant – Carter & Anor v Walker & Anor [2010] VSCA 340 – Backwell v AAA [1997] 1 VR 182 – Downes v Amaca Pty Ltd (2010) 78 NSWLR 451.
---
APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr D.F. Hore-Lacy QC with Mr D. Seeman | Lennon Mazzeo Lawyers |
| For the Second Defendant | Mr C.J. Blanden QC with Ms K.L. Burgess | Perry Maddocks Trollope |
TABLE OF CONTENTS
Introduction........................................................................................................................................ 1
The Adass community and School................................................................................................. 3
The recruitment and employment of Leifer................................................................................. 6
A distinction between Jewish Studies and General Studies at the School.......................... 14
Leifer stood down as headmistress.............................................................................................. 19
Sexual abuse...................................................................................................................................... 27
Duty of care....................................................................................................................................... 30
Direct liability................................................................................................................................... 30
Non-delegable duty of care/vicarious liability.......................................................................... 45
Negligence of the School................................................................................................................ 51
Causation and damages – non-economic loss............................................................................ 57
Damages – economic loss............................................................................................................... 66
Damages – medical expenses......................................................................................................... 69
Exemplary/aggravated damages.................................................................................................... 70
Mitigation of damages.................................................................................................................... 76
Conclusion......................................................................................................................................... 81
HIS HONOUR:
Introduction
Hadassa Sara Erlich, the plaintiff, was born on 24 June 1987. She is the fourth of seven children. Her family belong to the Ultra Orthodox Jewish community connected to the Adass Israel Congregation (‘the Adass community’). She attended a school administered by the Adass Israel School Inc, the second defendant, located at 10 – 12 King Street, Elsternwick (‘the School’). The School, for religious reasons, operates a boys’ campus and a girls’ campus.[1] The School is governed by a Board (‘the Board’)[2] elected biannually by the parents and members of the Adass community.[3] The Board’s primary ‘role is to govern’ and ensure ‘a proper oversight of the management and planning, both financial and strategic’[4] of the School. That oversight includes ‘employment of some senior teaching staff, such as Heads of [the boys’ and girls’] School’.[5] The plaintiff attended the School from kindergarten year, aged three, until Year 12, aged 18.[6] At the conclusion of Year 12, she was employed at the School the following year (2006) as a teacher for approximately eight months until she was married.[7]
[1]In these reasons, any reference to the School will concern the girls’ campus administered by the School when discussing the plaintiff and first defendant.
[2]In these reasons, I refer to the second defendant interchangeably as both ‘the School’ and ‘the Board’ as appropriate.
[3]The School is incorporated under the Associations Incorporation Act 1981. See plaintiff’s exhibit (PX) 57 (Certificate of Incorporation).
[4]Defendant’s exhibit (DX) 8 (Adass Israel School Strategic Plan of February 2008) at 2-3. The Strategic Plan, if there was one, prior to Leifer’s employment at the School was not tendered.
[5]Ibid.
[6]Supreme Court Transcript (‘Transcript’) at 124.21 - 124.27.
[7]Transcript at 135.19 - 135.30 and 150.1 - 150.8.
The plaintiff claims that between 2003 and 2006, she was sexually abused by the headmistress of the School, Mrs Malka Leifer, the first defendant (‘Leifer’).
The plaintiff in this proceeding claims as a consequence of that sexual abuse she has sustained severe psychiatric injury and claims damages for this injury and the consequent losses. The plaintiff also claims aggravated and exemplary damages against Leifer and the School.[8]
[8]The plaintiff does not include the year 2006 in this claim when she was employed by the School and when she alleges she continued to be sexually abused by Leifer.
Judgment had been entered against Leifer prior to the commencement of trial. Leifer currently resides in Israel, having left this jurisdiction on 6 March 2008. Leifer is facing extradition to Victoria from Israel in respect of criminal charges involving the sexual abuse of girls at the School.[9]
[9]Transcript at 111.10 – 111.11. Judgment in default of appearance was entered on 19 December 2014.
The School, in its Second Further Amended Defence, admits it operated the School, that Leifer was Principal of the School from December 2002 until March 2008 and that the School owed a duty to take reasonable care to prevent foreseeable injury to the plaintiff as a student at the School. At trial, Mr C.J. Blanden QC, senior counsel for the School, accepted that this duty was a non-delegable duty.[10] The School denies it breached its duty of care to the plaintiff, that it was negligent or reckless in its engagement with and oversight of Leifer and, despite the admission in its Second Further Amended Defence, denied at trial that Leifer was Principal. The School denies it employed Leifer, that Leifer was the servant or agent of the School and that the School is vicariously liable for Leifer’s actions.
[10]Transcript at 646.7.
At trial, the School alleged Leifer was employed by the Congregation Adass Israel Talmud Torah (‘the Congregation’), an unincorporated association concerned in part with religious instruction at the School. According to the Adass Israel School Strategic Plan (the ‘Strategic Plan’), the Congregation provides a wide range of religious and community services to the Adass community, including Jewish studies for school aged boys and girls ‘where such Jewish Studies are conducted on the premises of Adass Israel School’.[11] The School and the Congregation ‘have a distinct but overlapping membership’.[12]
[11]DX-8 (Adass Israel School Strategic Plan of February 2008) at 2-1.
[12]Ibid.
The plaintiff pleads in the alternative that, by virtue of her position and responsibilities within the School, Leifer ‘was in fact the mind and will’ of the School and the School is directly liable for her actions. The School denies this allegation.
The School, during the course of trial, did not challenge the nature or extent of Leifer’s sexual abuse of the plaintiff as detailed by the plaintiff.
The Adass community and School
To properly understand the issues raised by the pleadings, it is important to have a basic understanding of Ultra Orthodox Judaism as practised by the Adass community.
The evidence reveals a community that adheres to, by comparison with contemporary Australian society, an exceptionally rigid and strict code of behaviour. The Adass community is very close in terms of its associations, interrelationships and neighbourhood. It is also completely closed.
In accordance with the religious beliefs and practices of the Adass community, the plaintiff and her siblings were brought up in a home with no access to television, radio, internet, magazines or newspapers;[13] not even a sales catalogue entered the home.[14] Children were not raised having knowledge of world events and were completely isolated from anything ‘beyond the community [they] were within’.[15] There was no connection or mingling with students of other Jewish schools.[16] Children were only allowed to read Jewish books from the library,[17] which were vetted to exclude anything concerning a relationship between a male and a female: ‘we weren’t to know that a relationship could exist between a female and a male … we didn’t have anything to do with males [outside family] in the community from about three years old, completely separated’.[18]
[13]Plaintiff, Transcript at 124.7 - 124.8.
[14]Meyer, Transcript at 178.30 - 178.31.
[15]Meyer, Transcript at 178.20.
[16]Meyer, Transcript at 178.24.
[17]Meyer, Transcript at 179.1.
[18]Plaintiff, Transcript at 124.8 - 124.15.
The School was founded by members of the Congregation in Ripponlea and first registered as a school in 1953.[19] The intent of those who established the School was ‘to educate the new generation with a guarantee that the unbroken chain of Jewish tradition would be continued, even in a faraway continent’.[20] In 2008, over 500 children were enrolled at the boys’ and girls’ campuses.
[19]Herszberg, Transcript at 335.14 – 335.15.
[20]PX-51 (Two Copies of Adass Israel School Staff Handbook for 2008) at 5.
The School is in every sense a religious school. Its philosophies and policies:
…are sourced in the traditions, values and practice of Orthodox Judaism. The community, which supports the school, is totally committed to the inclusion of these traditions and values and has established and chosen this school for their children so the values and attitudes of the school and home are consistent. It is therefore imperative that the school maintains strict adherence to this philosophy.[21]
The Adass Israel School Staff Handbook for 2008 (the ‘Staff Handbook’) states:
Every aspect of the curriculum was to be permeated by a sensitivity and respect towards steadfast Torah observance of high morals and ethics.[22]
[21]DX-8 at 1-1.
[22]PX-51 at 5.
The Strategic Plan makes clear that Orthodox Judaism governs religious beliefs, lifestyle and everyday behaviour, and this is reflected in the organisation and orientation of the School. For example, for religious reasons, co-education is considered unacceptable in the Adass community. Thus, as previously stated, the School is strictly divided between a boys’ campus and a girls’ campus. This gender division required that males attending the girls’ campus speak from behind a divider screen: ‘we couldn’t see them and they couldn’t see us’.[23]
[23]Plaintiff, Transcript at 126.7 - 126.8.
During the time the plaintiff attended the School, there was no secular qualification offered, such as the Victorian Certificate of Education (‘VCE’) or the Victorian Certificate of Applied Learning (‘VCAL’).[24] Students who attended the School obtained no qualification recognised externally: ‘Year 12 was only the Jewish studies program, the teacher training program’.[25] The School offered ‘a significantly restricted curriculum – approved by the Registered Schools Board – within a very sheltered cultural environment.’[26]
[24]Spigelman, Transcript at 441.24 - 441.29.
[25]Herszberg, Transcript at 346.25. It is also to be noted that the teacher training program concerned the teaching of Jewish Studies, a role that the plaintiff was engaged in at the School in 2006, the year after she completed Year 12.
[26]PX-14 (Letter from Mr Moshe Nussbacher, administrator of the School, to Mr Geoff Coleman, Immigration Department, 29 November 2000).
Until 2007, the School did not offer an ‘official’ curriculum although it was registered as a school. The School was informed in 2007 by the Victorian Registration and Qualifications Authority (‘VRQA’) that unless there was a formal curriculum, the School would not be registered as a school to teach Years 11 and 12. The School thus adopted the VCAL program. Two reasons were provided in evidence for choosing VCAL over VCE for the girls’ campus. Firstly, VCE provides a pathway to university, but because of religious restrictions ‘it’s very difficult to encourage our girls to go to university’.[27] Secondly, the School cannot vet the VCE program offered: ‘VCE is set and we can’t look into it and choose “is that a good book that we want our girls to read[?]” and so on’.[28] In this respect VCAL provided more of an opportunity for the School to limit what was offered by way of curriculum.[29]
[27]Spigelman, Transcript at 440.19 - 440.21.
[28]Spigelman, Transcript at 440.26 - 440.29.
[29]Spigelman, Transcript at 440.30 - 441.5.
Mrs Esther Rizel Spigelman, now the Head of secular studies (‘General Studies’) at the School, said that secular and religious education were of equal importance.[30] I do not accept this evidence. In fact, at the time the plaintiff attended the School, there ‘was only the Jewish studies programme’ in Year 12 (‘Jewish Studies’).[31]
[30]Spigelman, Transcript at 441.28.
[31]Herszberg, Transcript at 346.26 - 346.28.
The Strategic Plan sets out a number of overall goals for the School.[32] The first listed goal is to produce graduates who ‘are able to preserve Orthodox Jewish traditions and practices and pass these on to the next generation’.[33] I am satisfied the teaching of Jewish Studies within the School was of paramount importance; more important than General Studies. This restrictive education program within the School was, in part, designed to maintain the rigid separation of its students from the wider community.
[32]DX-8 at 1-2.
[33]Ibid at 1-2.
That religious education was the fundamental reason for the existence of the School explains how Leifer came to control the day-to-day functioning and operation of the School, as I refer to in further detail below, particularly as she held the position of Head of Jewish Studies, in addition to her role as Principal or headmistress.[34]
[34]Transcript at 463.15.
The recruitment and employment of Leifer
The precise manner in which Leifer was approached in Israel and then appointed Head of Jewish Studies at the School in 2000 is unclear. According to Mr Benjamin Koppel, who was, at the relevant times, President of the Congregation, a Mr David Rosenbaum,[35] who was not called to give evidence, was tasked with enquiring into a number of candidates in Israel.[36] Mr D. Rosenbaum was a member of the Board at this time,[37] and according to Mr Koppel, was very keen for Leifer to take up a position at the School.[38]
[35]Transcript at 542.7 - 542.10.
[36]Koppel, Transcript at 542.13.
[37]Koppel, Transcript at 544.10.
[38]Koppel, Transcript at 544.16.
The following tendered documents demonstrate that it was the School, not the Congregation, who was responsible for recruiting and employing Leifer in 2000:
(a)On 18 October 2000, Mr Moshe Nussbacher, the ‘administrator’ of the School, wrote to the Commonwealth Department of Immigration (‘Immigration Department’) seeking a labour market waiver for ‘our application for the Immigration of Mrs Leifer who we would like to appoint as a Head Teacher of Adass Israel School’.[39]
(b)A ‘Sponsorship for Temporary Residence in Australia’ Form (the ‘Form’) completed by hand was tendered in evidence.[40] Although the name of the sponsor was inconveniently whited out on the Form, the address of the sponsor is recorded as the address of the School, being 10 – 12 King Street, Elsternwick. Moreover, ‘Adass Israel School Inc’ is nominated as employer of Leifer and Mr Nussbacher is recorded as the point of contact.
(c)On 27 November 2000, Mr Nussbacher reported to Mr P. Kemeny, Treasurer, Mr Yitzhok Benedikt, President, and Mr D. Rosenbaum, member of the Board that the labour market waiver request had been rejected by the Immigration Department.[41]
(d)On 13 December 2000, Rabbi L.Y. Greenfeld, then Principal of the School, wrote to the Immigration Department indicating ‘we’ had advertised the position Leifer was intended to fill in The Age and The Australian.[42]
(e)On 18 December 2000, Mr Geoff Coleman of the Immigration Department wrote to Mr Nussbacher stating that the School’s sponsorship of Leifer for an Educational Visa had been approved on the basis of the signed undertakings provided to the Immigration Department. The School sponsored Leifer, her husband Jacob and her then five children to come to Australia. The letter specified that Leifer, as holder of the visa, could not change employer or occupation in Australia without departmental permission.[43]
[39]PX-5 (Letter, School to the Immigration Department 18 October 2000) (emphasis added).
[40]PX-7 (Sponsorship for Temporary Residence in Australia, Form 55).
[41]PX-11 (Memorandum, Mr Nussbacher to Messrs Kemeny, Benedikt and Rosenbaum, 27 November 2000).
[42]PX-17 (Letter, Rabbi Greenfeld, principal of School, to Mr Coleman, 13 December 2000) (emphasis added).
[43]PX-18 (Letter, Mr Coleman to Mr Nussbacher, 18 December 2000).
At trial, Mr Blanden submitted that it was the Congregation that employed Leifer. He relies primarily on oral evidence that I refer to later in these reasons. It is to be noted that at the time of the initial engagement of Leifer none of the written documentation referred to the Congregation as Leifer’s employer. Other than Mr Koppel, all the persons involved with the appointment of Leifer occupied positions on the Board or were employed by the School. The documentation demonstrates the School not only sponsored Leifer to come to Australia, but also employed her at the School.
In 2002, the School restructured. Professor Israel Herszberg, now Principal of the School (both campuses) gave evidence that at this time Leifer was appointed to a position in charge of the girls’ campus, both primary and secondary:[44]
Her job was to be in charge of the girls’ school, the overall charge of the girls’ school and her primary responsibility was in the Jewish studies department with oversight of the ethos and practice of the School generally. She was supported by head of campus, Mrs Spigelman, whose responsibility was to look after the campus as a whole and to deliver the general studies program that was delivered.[45]
[44]Herszberg, Transcript at 337.8 - 337.10.
[45]Herszberg, Transcript at 338.2 - 338.9.
This evidence of Professor Herszberg[46] (apart from Mrs Spigelman being Head of the girls’ campus) is consistent with tendered documents that concerned Leifer’s new position. Because of this new position, the School was again required to liaise with the Immigration Department to obtain a visa to enable Leifer to work as ‘headmistress’ at the School. Tendered documents show that:
[46]In 2008 and after the departure of Leifer, Professor Herszberg became Principal of the School.
(a)A registered migration agent, Mr Farrel Savitz, of Australian Visa Services (‘Agent’), was arranged by the School to assist in the preparation of the visa application to the Immigration Department for Leifer. The agreement noted that the School was the sponsor of Leifer.[47]
[47]PX-23 (Agreement between Leifer, sponsored by the School, and Australian Visa Services, 16 October 2002).
(b)The Agent informed Mr Nussbacher, for the purposes of the visa application, that a flowchart would be necessary to demonstrate the administrative structure of the School and to ‘also describe where the school committee would be included’.[48] The costs of the Agent were billed to the School.[49]
[48]PX-24 (Correspondence, the Agent to Mr Nussbacher, 17 October 2002).
[49]Ibid.
(c)The Agent advised Mr Nussbacher that it would be necessary to demonstrate that ‘her application will be an exceptional appointment’ to obtain a visa for Leifer.[50] Thus, the Agent emailed Mr Nussbacher on 15 November 2002[51] stating that it was necessary to provide a resume detailing Leifer’s tasks and duties for her proposed roles as headmistress/religious instructions coordinator: ‘Mrs Leifer’s resume needs to show past experience in these areas – especially as a head mistress’.[52] Assistance was offered by the Agent to Mr Nussbacher for the purposes of crafting a resume to fit the visa requirements.
[50]PX-25 (Email, the Agent to Mr Nussbacher, 30 October 2002).
[51]Ibid.
[52]PX-25 (Email, the Agent to Mr Nussbacher, 15 November 2002).
(d)By email on 18 November 2002, the Agent wrote to Mr Nussbacher as follows:
Moshe to make this less complicated we should forget about the Religious Instructions Coordinator and only stipulate Headmistress on both applications and ensure all our documents regarding Mrs Leifer describes [sic] her as a person who is a Headmistress and that she has past experience in this area, i.e. that she has had the type of experience that a person in a Ultra-orthodox school would need to have had to become a head mistress of such an institution.[53]
[53]PX-25 (Email, the Agent to Mr Nussbacher, 18 November 2002).
(e)An advertisement was placed by the School in The Age on 30 November 2002 stating: ‘HEADMISTRESS req’d for Ultra Orthodox Jewish primary and secondary school. Must be qualified to teach Biblical texts, Jewish law and Chassidic philosophy and to provide pastoral care to students’.[54]
(f)On 2 December 2002, Mr Nussbacher wrote to the Immigration Department stating, in part:
On September 4, 2002 we restructured the Boys and Girls School which made available the position of Head Teacher for the Girls Primary and Secondary School. This position was required to be filled urgently.[55]
(g)On 12 December 2002, Ms Biljana Nastic of the Immigration Department wrote to Mr Nussbacher care of the Agent, advising that the application had been approved.[56] The Sponsor was recorded as ‘Adass Israel School Inc’. The occupation of Leifer, whom the School was sponsoring, was recorded as ‘School Principal (Headmistress)’. A visa, subclass 457, was also granted in this letter, with conditions including that Leifer, as the visa holder, ‘must not cease to be employed by their sponsor, work in a position or occupation which is inconsistent with that which was nominated and approved by [the Immigration Department] or work for another person/company or themselves’.[57]
(h)On 12 December 2002, Ms Nastic also wrote directly to Mr Nussbacher, again noting the conditions of the visa concerning Leifer’s employment with the School and the School’s responsibilities as her sponsor.[58] The letter also attached undertakings that were required of the School as Leifer’s sponsor. The undertakings agreed to by the School included to deduct tax from salary, accept the financial responsibility for all medical and hospital costs of the sponsored person incurred in Australia and to co-operate fully with the Immigration Department in monitoring the sponsored person.[59]
(i)On 15 January 2003, Ms Nastic wrote directly to Leifer.[60] This letter again recorded ‘Adass Israel School Inc’ as the sponsor of Leifer. The letter informed Leifer she must not ‘cease to be employed by [her] sponsor’, ‘work in a position or occupation which is inconsistent with that which was nominated and approved by the [Immigration Department]’ or ‘work for another person/company or themselves’.[61]
[54]PX-27 (Fax Proof Advertisement, The Age, 25 November 2002).
[55]PX-28 (Letter, Mr Nussbacher to Immigration Department, 2 December 2002).
[56]PX-31 (Letter, Ms Nastic to Mr Nussbacher, 12 December 2002).
[57]PX-31.
[58]PX-32 (Letter, Ms Nastic to Mr Nussbacher, 12 December 2002).
[59]Ibid.
[60]PX-33 (Letter, Ms Nastic to Leifer, 15 January 2003).
[61]Ibid.
This evidence demonstrates that the School, both in 2000 and in 2002/2003, arranged the employment of Leifer, informed the Immigration Department that it was the employer of Leifer and provided undertakings to the Immigration Department that it would continue to employ and be responsible for Leifer whilst she resided and worked in Australia. Mr Nussbacher was the point of contact. No document was produced to demonstrate any alteration to these arrangements with the Immigration Department during the period of Leifer’s employment at the School. Further, no document was produced to demonstrate any change to the employment agreements and arrangements existing between the School and Leifer.
There was other evidence tendered demonstrating that the School employed Leifer. An unsigned copy of a document headed ‘Contract between Adass Israel School Inc and Mrs Malka Leifer’ was tendered in evidence (‘Contract’).[62] When cross-examined concerning this Contract, Professor Herszberg stated he did not understand why the School was party to the Contract, as it should have been the Congregation.[63] Professor Herszberg agreed that there was no evidence that the Contract was not signed.[64] I do not accept the evidence of Professor Herszberg that the Contract should have been in the name of the Congregation. That the Contract was in the name of the School is entirely consistent with the body of evidence demonstrating the School was the sponsor and the employer of Leifer. If Leifer had been employed by the Congregation, the School would have been in breach of the undertakings given to the Immigration Department concerning her employment. Further, importantly, Professor Herszberg was not directly involved in the employment of Leifer.[65] The School failed to call persons intimately involved with her engagement at the School, namely, Mr Nussbacher and the then President of the Board, Mr Benedikt.
[62]PX-50 (Unsigned document headed ‘Contract between the Adass Israel School Inc and Mrs Malka Leifer’).
[63]Herszberg, Transcript at 375.1 - 375.6.
[64]Herszberg, Transcript at 375.25 - 375.26.
[65]Herszberg, Transcript at 336.7 - 336.8.
In final submissions, Mr Blanden contended that a number of matters raised by the evidence pointed to Leifer being employed by the Congregation as follows:
(a)The Congregation played a key role in the recruitment of Leifer by establishing a committee to find a candidate to fill the position of teacher of Jewish Studies at the School and Mr D. Rosenbaum made inquiries as to suitability. This submission relies on the evidence of Mr Koppel. Mr Koppel’s evidence does not support the proposition that the Congregation employed Leifer. At best, the evidence of Mr Koppel supports the contention that the Congregation inquired as to the suitability of Leifer to teach Jewish Studies. As referred to above, Mr D. Rosenbaum, who conducted these investigations, was a member of the Board. In fact, Mr Koppel agreed with the proposition put by Mr Blanden: ‘… at the time Mrs Leifer was first engaged by the School were you approached to make some inquiries in order to satisfy yourself she was an appropriate candidate?’[66] Mr Koppel did not state that the Congregation employed Leifer.
(b)Leifer’s salary was paid by the Congregation, which had a separate ABN number to that of the School. I do not accept that the Congregation paid the salary of Mrs Leifer between 2003 and 2006, being the period in which the alleged sexual abuse occurred. This submission relies on the evidence of Professor Herszberg. Professor Herszberg had no formal position with the School or Congregation over this period. His evidence relied upon ‘the best of [his] recollection’[67] that the financial records showed that the salary of Leifer was paid by the Congregation.[68] Professor Herszberg also stated that he recently checked the employment records from 2008 and that these records showed that Leifer’s salary was paid by the Congregation. These records were not produced at trial and, in any event, do not relate to the period during which the abuse occurred. No other primary source documents supporting this oral evidence of Professor Herszberg were tendered: no wage records and no pay slips were produced to demonstrate the Congregation paid Leifer’s salary. In fact, the one document concerning the salary of Leifer that was tendered (by the plaintiff) on its face supports the evidence that the School was responsible for her salary; the salary document is headed ‘ADMIN – Adass Israel School Inc’.[69]
(c)Professor Herszberg stated that from 2008, there was a more rigorous separation of the School and Congregation.[70] This may or may not have occurred in 2008. There is no evidence to suggest any such separation occurred prior to 2008. All correspondence and documentation concerning Leifer’s employment is on the School’s letterhead. I do not accept that this occurred solely because of some lack of sophistication at the School or that the Congregation did not have its own letterhead.[71] The use of the School’s letterhead is entirely consistent with other evidence demonstrating that Leifer was employed by the School. Again I observe, Mr Nussbacher, the person on the evidence who was most closely associated with the employment of Leifer, was not called. Mr Benedikt, President of the Board at the time of Leifer’s engagement, was also not called to give evidence. No explanation for the failure to call these witnesses was proffered by Mr Blanden on behalf of the School. The best evidence, being the written documentation at the time of first engaging Leifer in 2000 and at the time of appointing her as headmistress of the girls’ campus in 2002/2003,[72] unequivocally demonstrates that the School employed Leifer. No document was tendered that in any way demonstrated her employer changed from the School to the Congregation.
(d)It is contended that a lease agreement between the Congregation, Leifer and her husband, Rabbi Jacob Leifer, of 26 February 2001[73] demonstrates an employment relationship between Leifer and the Congregation. The lease agreement concerned the lease of a Tarago van. The van was leased by the Congregation on behalf of the Leifers. Lease payments were to be deducted from Leifer’s salary. I do not agree with the submission on behalf of the School that this lease agreement demonstrates employment. The document discloses no more than a lease agreement between the Leifers and the Congregation. Further, Professor Herszberg gave evidence that the Hebrew writing on the document indicated that the car belonged to Jacob Leifer and that he could sell the vehicle whenever he wished and retain any profits from the sale.[74] The document does not support the proposition that the Congregation employed Leifer. Further, I note this document, in contrast to Leifer’s Employment Contract, bears the letterhead of the Congregation.
[66]Koppel, Transcript at 542.11 - 542.15 (emphasis added).
[67]Herszberg, Transcript at 336.27.
[68]Herszberg, Transcript at 336.25 - 336.31 and at 418.22 - 418.25.
[69]PX-22 (Document concerning payroll and superannuation details of Leifer).
[70]Herszberg, Transcript at 357.14-.16.
[71]Herszberg, Transcript at 372.10 - 372.24.
[72]Transcript at 337.8 - 337.9.
[73]DX-3 (Agreement between Adass Israel Talmud Torah and Rabbi and Mrs Leifer).
[74]Herszberg, Transcript at 339.6 - 339.15.
A distinction between Jewish Studies and General Studies at the School
Mr Blanden submitted that I should accept evidence that he claimed demonstrated a clear distinction between the teachers of Jewish Studies and teachers of General Studies at the School. He contended the evidence demonstrated that teachers of Jewish Studies were employed by the Congregation, whilst teachers of General Studies were employed by the School. Professor Herszberg, in his evidence, took this distinction further. He stated that Leifer did not ‘take classes under the auspices of the registered schools program’.[75] Leifer was never registered with the State authority as a teacher at the School. In cross-examination, Professor Herszberg provided the following evidence:
She’s not a teacher?---That’s right.
Are you serious about that? She is headmistress, taught at the School, and you say she wasn’t a teacher?---She didn’t teach in the School, she didn’t teach in a registered school - - -
Didn’t teach in the School?---She taught under a program run by the congregation which was separate from the School.[76]
[75]Herszberg, Transcript at 414.11 - 414.13.
[76]Herszberg, Transcript at 414.28 – 415.3.
Professor Herszberg provided contradictory evidence concerning the role of Leifer in the School. He agreed with the proposition that as ‘principal’ of the School, Leifer was responsible for both religious and secular studies.[77] He described Leifer as being ‘in charge of the girls’ school, the overall charge of the girls’ school’.[78] When I asked Professor Herszberg why, if Leifer was referred to as ‘headmistress’, her role was restricted to the teaching of Jewish Studies, he replied, after a substantial pause, ‘I can’t answer that question’.[79] Professor Herszberg said Mrs Spigelman, Head of General Studies, ‘was given the job to work with [Leifer] as an assistant’.[80]
[77]Herszberg, Transcript at 416.28 - 416.30.
[78]Herszberg, Transcript at 338.2 - 338.5.
[79]Herszberg, Transcript at 368.20 - 368.21.
[80]Herszberg, Transcript at 365.1 - 365.2. As was subsequently disclosed in evidence, Mrs Spigelman also was not a registered teacher.
I do not accept that Leifer was in some way removed from the School, that she did not ‘teach’ at the School or that her involvement was through a separate program of religious education. The evidence demonstrates that Leifer was the most powerful figure within the School. The evidence of Professor Herszberg on this issue, in my opinion, was unreliable and embellished in an attempt to hide Leifer’s true role at the School. The reason for the embellishment: Professor Herszberg well knew Leifer was not a registered teacher, yet she was teaching and was the senior teacher and headmistress of the School, a registered school.[81]
[81]Teachers then were required to be registered under the Education and Training Reform Act2006.
The duty statement prepared upon Leifer assuming the position of headmistress was tendered in evidence (‘Duty Statement’).[82] Leifer’s duties included –
[82]PX-29 (Duty Statement For Headmistress on Adass Israel School letterhead).
(a)responsibility for the primary and secondary schools of the School;
(b)the coordination of religious and secular staff;
(c)speaking regularly with Jewish Studies and General Studies staff concerning progress and problems;
(d)motivating and assessing staff performance;
(e)the oversight of curriculum audit and documentation;
(f)assisting staff with curriculum development and monitoring implementation;
(g)assisting the organisation of casual relief staff;
(h)researching and evaluating religious and secular teaching materials and resources for staff and students;
(i)assisting the manager or his deputy in hiring staff;
(j)the monitoring and supporting of staff concerning the consistent implementation of all policies;
(k)supporting staff concerning parental issues and student welfare; and
(l) the oversight of student welfare and discipline.
The Duty Statement confirms Leifer’s position at the School was ‘a full time position necessitating constant availability (i.e. including after hours)’.[83]
[83]PX-29.
The role set out in the Duty Statement indicates that Leifer, within the girls’ campus, held the preeminent position of power. In evidence, she was described as ‘head of school and she ran everything that happened in the school’.[84] Mrs Mindel Weisner, an ex-student of the School, was a teacher at the School for Years 10, 11 and 12 from 2003 until 2006.[85] She was employed by Leifer.[86] She gave evidence that Leifer ‘conducted the school’[87] and was ‘in charge’ of Mrs Spigelman and Mrs Sharon Ann Bromberg (a senior teacher and now School chaplain).[88] A practical demonstration of the dominating position of Leifer within the School is evident from an extract contained in the Staff Handbook.[89] Under the heading, ‘Vetting of text books and all teaching material’, the Staff Handbook states:
In accordance with Adass Israel philosophies, staff are required to submit all new course material for screening. No material (e.g. novels, storybooks, poems, general articles, non-prescribed text books, tapes, songs or lyrics etc) may be used without prior approval from the Principal of Jewish Studies.[90]
Leifer was head of Jewish Studies.[91]
[84]Plaintiff, Transcript at 126.25 - 126.26.
[85]Transcript at 231.16 - 231.31.
[86]Weisner, Transcript at 231.11.
[87]Weisner, Transcript at 233.17.
[88]Weisner, Transcript at 241.13 - 241.16.
[89]PX-51 at 11.
[90]Ibid.
[91]In the Staff Handbook, Leifer, as senior member of the School staff at the girls’ campus of the School, is called ‘Menahales’, a position held by Rabbi Greenfeld at the boys’ campus of the School. See PX-51 at 28 – 29.
Mrs Spigelman gave evidence that as head of General Studies she worked closely with Leifer,[92] who she described as ‘head of Jewish Studies’.[93] I do not see their work relationship as in any way reducing the overall authority of Leifer as head of the School. The evidence of Mrs Spigelman supports other evidence of the close involvement of Leifer with the operation of the School. Leifer’s office was opposite the room occupied by Year 11 and Year 12 students;[94] Leifer had a close relationship with the students, with whom she interacted on a daily basis.[95]
[92]Spigelman, Transcript at 429.16 – 429.23.
[93]Spigelman, Transcript at 463.15.
[94]Spigelman, Transcript at 439.21 - 439.23.
[95]Spigelman, Transcript at 443.23 - 443.28.
The curriculum vitae of Leifer, presumably prepared to support her visa application for the position of headmistress at the School, contained a diagram of the administrative structure of the School.[96] This diagram indicates that at the head of the administration of the School was the Board and immediately under the Board was ‘Principal Jewish Studies – Mrs M. Leifer’, and ‘Principal Secular Studies Rabbi L.Y. Greenfeld’.[97] Mrs Spigelman on the diagram was described as ‘Assistant Principal’, reporting to both Leifer and Rabbi Greenfeld.[98] I have no doubt this diagram generally reflects the power and authority of Leifer in the girls’ campus and the critical importance of Jewish Studies in the girls’ campus, as it is consistent with other evidence.
[96]DX-2 (Resume of Leifer).
[97]Ibid.
[98]Ibid.
Mr Blanden referred me to correspondence between the VRQA, the Victorian Institute of Teaching (‘VIT’) and Mr Benedikt, President of the Board, in March 2008.[99] Mr Blanden submitted the correspondence supported the contention that Leifer was employed by the Congregation.
[99]See PX-34 (Letter, Mr Benedikt to Ms Lynn Glover, Director at VRQA, 17 March 2008); PX-35 (Letter, Ms Annabel Haslam of VIT, to Mr Benedikt, 28 March 2008); PX-36 (Letter, Mr Benedikt to Ms Haslam, 7 April 2008); and PX-37 (Letter, Ms Haslam to Mr Benedikt, 29 April 2008).
Mr Benedikt wrote to Ms Lynn Glover, director of the VRQA, on 17 March 2008 after receiving a request from the VRQA to provide information concerning the qualifications of Leifer who, by this time, had been named in media reports as having molested girls at the School.[100] In this correspondence, Mr Benedikt stated:
Mrs Leifer was employed by the Congregation Adass Israel (the Congregation), who operates a range of services for the Jewish Community including but not limited to Jewish religious education, which is partly conducted on the premises of Adass Israel School (the School) outside the secular curriculum of the School. The religious education programs for boys and girls are conducted separately and Mrs Leifer was associated with religious education for girls.[101]
[100]PX-53 (Copy of an article published in The Age headed ‘Principal “molested schoolgirls”’, 14 March 2008).
[101]PX-34.
Following this correspondence, on 28 March 2008, Ms Annabel Haslam, of VIT, wrote to Mr Benedikt[102] raising concerns that newspaper reports indicated the School employed Leifer as a teacher and the letter questioned why she had not been registered to teach in Victoria, where non-registration was a contravention of the Education and Training Reform Act2006. Mr Benedikt replied to Ms Haslam on 7 April 2008 and stated:
Contrary to the newspaper reports to which you refer, Mrs Malka Leifer was not employed as teacher [sic] at Adass Israel School, nor did she teach at Adass Israel School.
Mrs Leifer was employed by the Congregation Adass Israel, which operates a range of services for the Jewish Community including but not limited to Jewish religious instruction, which is partly conducted on the premises of Adass Israel School outside the curriculum of the Registered School.[103]
[102]PX-35.
[103]PX-36.
The letters of Mr Benedikt are misleading concerning the School’s employment of Leifer and do not explain the true role and responsibilities of Leifer at the School. The statement ‘she did not teach at the School’ is disingenuous. The letters, drafted after the exposure of Leifer’s alleged sexual abuse in the media, most certainly do not stand as evidence that Leifer was employed by the Congregation, rather than the School. I consider the letters are self-serving, an attempt by Mr Benedikt on behalf of the Board to deflect the attention of the regulatory authorities away from the School to the Congregation. The letters fail to properly represent the duties of Leifer within the School, her daily contact with students of the School and her responsibilities as detailed in her Duty Statement. The failure to call Mr Benedikt without explanation permits the inference that Mr Benedikt’s evidence would not have assisted the School’s case. I draw the available inference that he would not have assisted the School’s case on the issue of Leifer’s employment and responsibilities within the School.[104]
[104]See Glass JA in Payne v Parker [1976] 1 NSWLR 191, 200 – 202, setting out principles concerning failure to call a witness after review of relevant authorities including Jones v Dunkel (1959) 100 CLR 298 and O’Donnell v Reichard [1975] VR 916.
Leifer stood down as headmistress
The manner in which the allegations of sexual abuse committed by Leifer were brought to the attention of the Board, the manner in which these allegations were investigated by the Board and the Board’s decision to stand Leifer down and pay for the airfares of Leifer and her family to depart Australia for Israel are relevant to the issue of Leifer’s employment and to the issue of the persons exercising power, supervision and control at the School.
The evidence discloses that Mrs Bromberg was the first to become aware of allegations of misconduct concerning Leifer with female students.[105]
[105]Mrs Bromberg commenced teaching religious studies at the School in 1981. She is also not a registered teacher.
Mrs Bromberg was contacted in August 2007 by a Melbourne psychologist, a friend, Ms Ruthie Casen, who asked her during the course of a telephone call, ‘is it possible at all that Mrs Leifer has crossed any boundaries with the girls … is all in order there?’[106] Mrs Bromberg was not told, and apparently did not ask Ms Casen for the source of the information leading to this telephone call.
[106]Bromberg, Transcript at 486.26 – 487.11.
Mrs Bromberg, as a consequence of the telephone call with Ms Casen, visited Leifer ‘a couple of days later’ and raised the issue with her:
Visit who?---Mrs Leifer. And I said to her, “Mrs Leifer, someone asked me a question about some of your interactions with the girls and I think you need to know that not everybody is entirely comfortable with that”.
And did you get any response from her at that stage?---She said “Thank you very much for coming to visit me. I’ve actually had a chat about this to” – what was the Vaad HaChinuch, the rabbinical umbrella…there was a group of rabbis that when she had questions she could turn to them to answer questions…And she told me that she had actually had a chat with them about it and all was in order, all was good. I didn’t do more than that at that point.[107]
[107]Bromberg, Transcript at 487.25 – 488.9.
Mrs Bromberg did not believe that Leifer could be capable of committing sexual misconduct against girls at the School. The conversation was raised with nobody else.[108] Mrs Bromberg’s lack of urgency in relation to these allegations was unexplained on the evidence.
[108]Bromberg, Transcript at 488.8 – 488.9.
Mrs Bromberg received a further phone call from Ms Casen 11 to 12 days before Leifer left the country on 6 March 2008. Ms Casen informed her that allegations had again been raised concerning the conduct of Leifer and that ‘there seems to be some substance to these allegations’.[109] Ms Casen stated that ‘apparently there’s been a young lady [an ex-student of the School] in therapy who has divulged to the therapist that inappropriate conduct has taken place between herself and Mrs Leifer’.[110] Mrs Bromberg knew the ex-student who had made the allegations. Mrs Bromberg telephoned the ex-student, who was in Israel. This telephone conversation confirmed for Mrs Bromberg the substance of the allegations that ‘clearly sexualised behaviour’ had taken place and ‘important boundaries had been crossed’.[111]
[109]Bromberg, Transcript at 488.26 – 488.27.
[110]Bromberg, Transcript at 488.24 - 488.31.
[111]Bromberg, Transcript at 490.11 - 490.26.
After this conversation with the ex-student, Mrs Bromberg telephoned Leifer at around midnight and then went and picked Leifer up in her motor vehicle. After driving a short distance, Mrs Bromberg stopped and told Leifer of the allegations that had come to light again.[112] Leifer thanked her for raising the issue, told Mrs Bromberg that she had the issues already covered, having discussed the issues and received advice from the Vaad HaChinuch.[113]
[112]Bromberg, Transcript at 491.6 - 491.13.
[113]Bromberg, Transcript at 491.14 - 491.21.
Mrs Bromberg was not comforted with this reassurance on this occasion. She gave much consideration to whom she thought she could raise the issue with responsibly. Mrs Bromberg believed Leifer had ‘groomed’ the Adass community to believe in her, and so she decided she would ‘head for two authorities who I felt were protecting her and whose word would be respected by all’.[114] They were Rabbi Wurzberger and Rabbi Beck, who were part of the Vaad HaChinuch for the School. Rabbi Beck was Rabbi of the Congregation, and Leifer frequently went to Rabbi Wurzberger and his wife for advice on religious matters and the School.[115]
[114]Bromberg, Transcript at 492.1 - 492.7. The actual role the Vaad HaChinuch played in the operation of the School and the Board was not the subject of evidence, apart from it potentially being a rabbinical board that ‘answers questions for the School’ (Bromsberg, Transcript at 492.10 – 492.12).
[115]Bromberg, Transcript at 492.16 - 492.22.
Mrs Bromberg made an appointment to attend the Wurzberger home at 3.00pm on Friday 29 February 2008. She was later informed by Mrs Wurzberger that it was not possible to attend her home.[116] As a consequence, Mrs Bromberg spoke to Mrs Wurzberger by telephone and, during the course of the conversation, Mrs Wurzberger informed her that ‘she knew what [she] was calling about and she was literally feeling sick’.[117] Mrs Wurzberger said ‘I’ve heard a little bit about this before’, and at the end of the conversation, apparently within the hearing of her husband, Rabbi Wurzberger, she stated ‘I think there may be some truth to these allegations’.[118]
[116]Bromberg, Transcript at 495.16 - 495.21.
[117]Bromberg, Transcript at 429.26 – 429.27.
[118]Bromberg, Transcript at 496.5 - 496.18. How long Mrs Wurzberger had known of allegations concerning the misconduct of Leifer, again, was not the subject of evidence.
Mrs Bromberg then arranged to meet Rabbi Beck. Rabbi Beck said little, yet apparently listened carefully. As it was getting close to the Sabbath, Mrs Bromberg left that meeting believing she had acted appropriately by raising the issue.[119]
[119]Bromberg, Transcript at 497.1 - 497.3.
The following Tuesday, 4 March 2008, Mrs Bromberg attended a meeting at the home of Rabbi Telsner with Rabbis Telsner, Donnembaum and Katz, barrister Mr Norman Rosenbaum and psychologist Dr Vicki Gordon.[120] Mrs Bromberg was not sure of the role of those in attendance at the meeting; she informed those present of her conversation with the ex-student and why she believed the allegations.[121] By this stage, she was aware two different persons, ex-students, had made allegations concerning the conduct of Leifer.[122]
[120]Dr Gordon is the daughter of the late Mr Izzy Herzog (Spigelman, Transcript at 449.2).
[121]Bromberg, Transcript at 499.1 - 499.6.
[122]Bromberg, Transcript at 499.21 - 499.23.
Mrs Bromberg was then asked to attend a meeting at the home of Mr Izzy Herzog, a respected Adass community member. She recalled Mr Benedikt, Mr Mark Ernst (both Board members) and Dr Gordon being in attendance. She only attended for five or ten minutes. The meeting was held on Wednesday, 5 March.[123] Ms Bromberg said, the next day, Leifer was not at the School. Dr Gordon addressed the students on Thursday, 6 March, and Mrs Bromberg addressed staff on Friday, 7 March, to tell them Leifer had been stood down.[124]
[123]Rosenbaum, Transcript at 574.29.
[124]Bromberg, Transcript at 503.20 - 503.26.
Leifer left Australia for Israel on Thursday, 6 March 2008 at 1.20am.[125]
[125]See PX-38 (Airline tickets and payment details concerning the issuing of tickets on 5 March 2008 and flights on 6 March 2008 for Leifer and members of her family).
Mr N. Rosenbaum, a barrister, from time to time provides pro bono legal advice to the Congregation and the Adass community. He was called as a witness in the School’s case. Mr Rosenbaum was initially contacted by psychologist Dr Gordon and understood ‘she had certain information which had come to her from victims of abuse by – alleged abuse by Leifer’.[126] Mr Rosenbaum stated he was present at the meeting held at the home of Mr Herzog[127] and at this meeting, it was decided that Leifer should be stood down. Mr Rosenbaum said he gave advice that Leifer should be stood down rather than dismissed.[128] Mr Rosenbaum stated that Mr Benedikt, Mr Ernst and maybe Mr Herzog called Leifer to inform her that she was being stood down.[129] A conference telephone was used.[130] Although in the same room, Mr Rosenbaum claimed he could not hear the discussion that took place.[131] He said he was subsequently informed by those involved in the discussion that Leifer had said: ‘You have destroyed my reputation. I’m not going to stand for this. I’m leaving. I resign’.[132] Mr Rosenbaum said he later heard Leifer had left the country. This evidence of Mr Rosenbaum is contradicted by the evidence of Mr Ernst who stated that Leifer was asked to leave the country, which implies dismissal, rather than being stood down,[133] and by the letter of the School to alumnae stating that Leifer ‘had been dismissed from the School for inappropriate conduct’.[134] Further, Mr Ernst stated in evidence that all decisions made on that evening were ‘collective’ and were made with ‘all the people present’.[135]
[126]Rosenbaum, Transcript at 551.8 – 555.11.
[127]Rosenbaum, Transcript at 554.30.
[128]Rosenbaum, Transcript at 575.20 – 575.31.
[129]Rosenbaum, Transcript at 555.6 - 555.12.
[130]Rosenbaum, Transcript at 560.16.
[131]Rosenbaum, Transcript at 561.12 - 561.16.
[132]Rosenbaum, Transcript at 555.20 - 555.23.
[133]Ernst, Transcript at 264.7. See also Reasons at [60].
[134]DX-10 (Letter, School to Alumnae, undated).
[135]Ernst, Transcript at 264.9 - 264.12.
Mr Rosenbaum said that the allegations of sexual abuse by Leifer were not directly reported to police, and that ‘we didn’t know who the people were, the victims’.[136] However, it is apparent from the evidence that within a day of the School becoming aware of the allegations concerning Leifer, thus before her departure from the jurisdiction, the School knew of ‘a further eight person’s [sic] affected by Mrs Leifer’s alleged misconduct’.[137]
[136]Rosenbaum, Transcript at 555.31 – 556.1.
[137]PX-34.
Mr Rosenbaum said he spoke to police on behalf of the Adass community. He was unable to recall whether these discussions occurred before or after the publication of The Age newspaper article on 14 March 2008.[138] He said at the time of the first conversation with police he was not aware that Leifer had departed the country.[139] This is surprising as he was at the meeting on Wednesday 5 March when Leifer was telephoned by Messrs Benedikt, Ernst and Herzog, following which urgent arrangements were made for Leifer to depart the country. As stated above, Mr Ernst said decisions made that evening were collective, made by all the people present.
[138]Rosenbaum, Transcript at 574.7 – 574.13. See PX-53.
[139]Rosenbaum, Transcript at 574.17.
The allegations considered at the meeting at the home of Mr Herzog on Wednesday 5 March were allegations of serious criminal conduct by Leifer, yet police were not advised or consulted as to the appropriateness of facilitating Leifer’s departure from this jurisdiction in the face of such serious allegations.[140]
[140]I do not accept that not knowing the names of the victims may be used as an excuse for not reporting the allegations concerning Leifer to police before she left the jurisdiction. It had been determined by the evening of Wednesday 5 March that Leifer had a case to answer. If the rabbinical/Board inquiry could reach such a conclusion it emphasises the importance of full disclosure to police prior to Leifer’s arranged departure from the jurisdiction.
Professor Herszberg, in evidence-in-chief, stated he first found out about the allegations of sexual abuse on the day she left Australia. He said two members of the Board were dealing with it.[141] Professor Herszberg said that as a result of these investigations: ‘The two members of the Board at the time there [sic] came to the conclusion that she [Leifer] couldn’t continue on at the school. She was stood down’.[142]
[141]Herszberg, Transcript at 344.6 - 344.11. Other evidence indicates that the two Board members were Mr Benedikt and Mr Ernst.
[142]Herszberg, Transcript at 376.20 - 376.24.
Although apparently not directly involved, Professor Herszberg, on behalf of the School, sent an email to a representative of WorkCover on 24 March 2014 concerning the investigation and handling of the allegations against Leifer by the School.[143] He informed the WorkCover representative as follows in the email:
(a)during the period Sunday, 2 March to Friday, 7 March 2008, the matter was further investigated and a further victims were identified and a panel established to investigate and ‘determined there was case [sic] for Mrs Leifer to answer’;
(b)on Sunday, 9 March 2008, the President and Secretary of the Committee of Management were apprised of the situation, following which the President confronted Leifer with the allegations which she vigorously denied. Leifer was stood down pending further investigations. Within a few hours, Leifer resigned and informed the President that she was returning to Israel; and
(c)on Tuesday, 11 or Wednesday, 12 March 2008, Leifer ‘left Melbourne, presumably for Israel’.[144]
[143]PX-49 (Unredacted email, Mr Herszberg to Ms Bernadette Marshall, 24 March 2014).
[144]Ibid.
In the light of the evidence of Mrs Bromberg, the ticketing arrangements for the departure of Leifer and family members on the morning of 6 March and the evidence of Mr Ernst as to the removal of Leifer from the School, the account of Professor Herszberg to the WorkCover representative is unsatisfactory and inaccurate, particularly as to the references to the date and arrangements for Leifer’s departure from the jurisdiction.
Mrs Tammy Koniarski, a travel agent, stated in evidence that she received a phone call from Mrs Hadassa Ernst at about 9.00pm or 10.00pm on the evening of 5 March.[145] Mrs Ernst is the wife of Board member Mr Ernst.[146] Mrs Koniarski stated she was informed in that telephone conversation that people were required to travel to Israel ‘urgently’.[147] Mrs Koniarski booked the tickets for travel to Hong Kong, then on to Israel, departing Melbourne at 1.20am on 6 March.[148] Copies of the tickets were tendered in evidence, indicating travel for Leifer and four children.[149]
[145]Koniarski, Transcript at 246.5 - 246.6.
[146]Ernst, Transcript at 256.22.
[147]Koniarski, Transcript at 245.26 – 245.31.
[148]Koniarski, Transcript at 247.23 - 247.29.
[149]PX-38.
The course of events based on the evidence is as follows - Mrs Bromberg reported her concerns of the impropriety of Leifer to Rabbis Wurzberger and Beck on Friday 29 February, and by Wednesday 5 March, Leifer was found to have a case to answer. A meeting was held on Wednesday 5 March at the home of Mr Herzog. After a discussion by telephone with Leifer, arrangements were made for her to leave the country by 1.20am on 6 March. The ‘urgency’ of the issuing of tickets and removal of Leifer from the jurisdiction was not satisfactorily explained in evidence. Mr Ernst was subpoenaed to give evidence by the plaintiff. He stated he had, at the time, been a member of the Board for two years.[150] He attended the meeting resulting in Leifer’s departure, as did Mr Benedikt, the President of the Board.[151] At one stage of his evidence, Mr Ernst said there was no urgency in removing Leifer from the country.[152] Later, he said he could not recall the motivation for asking Leifer to leave the country.[153] Later again, he stated there was a need to stand Leifer down ‘as quick as possible’.[154]
[150]Ernst, Transcript at 271.30.
[151]Ernst, Transcript at 269.18 - 269.22. Note – in the course of the evidence of Mr Ernst, the Board was referred to as a committee both by the witness and counsel. The committee, so described, was in fact the Board – the incorporated entity. See Ernst, Transcript at 269.23 – 271.2.
[152]Ernst, Transcript at 258.1 - 258.4.
[153]Ernst, Transcript at 264.7.
[154]Ernst, Transcript at 266.23.
The airline tickets for the flights of Leifer and members of her family were paid for by an Adass community member, Mr Robert Klein, and a company associated with Board President, Mr Benedikt. The School reimbursed these persons for payment of the tickets.[155] At the time of the arranging the departure of Leifer, Mr Benedikt and Mr Ernst were acting on behalf of the Board.[156]
[155]Herszberg, Transcript at 382.7 - 382.21.
[156]Herszberg, Transcript at 386.27.
Professor Herszberg stated in evidence that at the time of the departure of Leifer, there was advice to executive members of the Board (unnamed, but presumably Messrs Benedikt and Ernst) ‘that there was really nothing we could do to keep her, to make her stay’ and paying for the tickets was ‘part of our legal obligation’ to her.[157] Who provided that legal advice and when it was provided was not the subject of evidence.
[157]Herszberg, Transcript at 381.9 - 381.15 and 382.15.
I am unable to understand what legal obligations would be cast upon the School to pay for the airfares of Leifer and family members to so urgently depart Australia in circumstances where, after investigation, representatives of the School had determined ‘there was case [sic] for Mrs Leifer to answer’[158] concerning very serious criminal conduct. This issue was not explored in any depth at trial. It is apparent the persons involved were determined to get Leifer out of the country within a matter of hours of the decision to remove her from her position at the School. The timing of the booking of the tickets and departure of Leifer and members of her family is extraordinary. More importantly, in the context of the issues in this case, the payment of Leifer’s airfares by the School in purported compliance of contractual obligations is yet further evidence, if more were necessary, that the School was the employer of Leifer. I deal further with issues concerning the departure of Leifer when considering the plaintiff’s claim for exemplary damages.
[158]PX-49.
Sexual abuse
The plaintiff had an unhappy home life. In evidence, the plaintiff stated that within her home, she was subjected to physical and emotional abuse from her mother, as were her other siblings.[159] Physical punishment could include beatings, slapping or kicking, and emotional deprivation included picking on one child and providing privileges to another, the refusal of meals or being locked out of the house.[160]
[159]Plaintiff, Transcript at 146.6 - 146.10.
[160]Plaintiff, Transcript at 146.16 - 146.25.
Leifer developed a relationship with the plaintiff’s oldest sister, Ms Nicole Meyer (who Leifer also sexually abused), which the plaintiff observed: ‘seemed to be a very supportive connection’.[161] Leifer developed a connection when she approached the plaintiff and informed her that she knew of the difficulties concerning the plaintiff’s home life and she could help with those difficulties.[162]
[161]Plaintiff, Transcript at 126.29.
[162]Plaintiff, Transcript at 126.29 - 127.1.
Leifer was described by Mr Ernst as being manipulative in the way she spoke with students, something he knew before the events of sexual molestation were known.[163] The evidence demonstrates that Leifer was manipulative in her dealings with the plaintiff. Leifer would gain permission from the plaintiff’s mother for the plaintiff to attend School camps where she would take the plaintiff out of class to talk about the plaintiff’s home issues. When the plaintiff was in Year 10, Leifer organised, both at School and at Leifer’s home, for her to undertake special one on one lessons in Jewish values and Jewish morals.[164] The plaintiff stated she came from a home where she did not feel worthy, and that the attention from Leifer made her feel very special and privileged. The uncontradicted evidence is that Leifer held a special place in the Adass community, that Leifer was looked up to ‘and anyone that had a connection with her, other people became jealous over it’.[165] The plaintiff viewed Leifer as someone that was completely trustworthy.[166] Mrs Meyer commented that Leifer ‘managed to charm everyone very quickly’.[167] It is within this setting that the sexual molestation of the plaintiff by Leifer commenced.
[163]Ernst, Transcript at 272.5 - 272.12.
[164]Plaintiff, Transcript at 127.14 - 127.30.
[165]Plaintiff, Transcript at 128.3 - 128.8 and Bromberg, Transcript at 536.11 - 536.16.
[166]Plaintiff, Transcript at 128.11.
[167]Meyer, Transcript at 180.2.
The plaintiff was aged 15 when Leifer commenced the sexual abuse.[168] The first encounters involved Leifer rubbing and touching the plaintiff on her thighs and back over her school uniform. Leifer would say to the plaintiff that ‘She loved [her] … she was like a mother to [her], that she felt really close to [her] and this was her way of showing how close she felt to [her]’.[169]
[168]Plaintiff, Transcript at 148.21.
[169]Plaintiff, Transcript at 129.1 - 129.4.
The nature of the abuse committed by Leifer on the plaintiff soon became more serious, with Leifer touching the plaintiff on her skin, rubbing her back, stomach and breasts, sucking her breasts and penetrating her vagina with her fingers.[170] The plaintiff stated she would touch her vagina almost every time she touched her in any way. The abuse sometimes occurred two to three times a week and sometimes not for a couple of weeks.[171]
[170]Plaintiff, Transcript at 130.1 - 130.5; 130.26 - 130.31.
[171]Plaintiff, Transcript at 149.1 - 149.2.
The sexual abuse was accompanied by Leifer telling the plaintiff how much she loved her, which made the plaintiff feel special.[172] In these sessions, Leifer would frequently pick up the plaintiff’s hand and place her hand on various parts of her own body.[173] The abuse occurred at Leifer’s home and on School camps. On many occasions, the abuse occurred in offices at the School itself.[174]
[172]Plaintiff, Transcript at 131.30 - 132.4.
[173]Plaintiff, Transcript at 132.26 - 132.31.
[174]Plaintiff, Transcript at 131.14 - 131.25 and 133.14 - 133.18.
In her life, the plaintiff had not been exposed to any form of nakedness prior to the abuse of Leifer. At home, she dressed and undressed privately in the bathroom – ‘we were always completely covered’.[175] That the plaintiff’s upbringing had been so closed and restricted meant she was extraordinarily vulnerable to a person such as Leifer.
[175]Plaintiff, Transcript at 149.15.
Throughout the period of abuse, the plaintiff confided in Leifer all the difficulties of her home life and her personal life.[176] This caused great pressure on the plaintiff because of fear of disclosure: ‘… the way that the community works, if the abuse that was going on at home would have come out, it would have lowered my chances of getting married, and the matchmakers wouldn’t set me up. So the threat of people knowing that I came from an abusive background was a very big threat for me at the time’.[177] In these circumstances, the plaintiff did not feel equipped to stop what was happening with Leifer – ‘she was the principal of the School and was a very, very, very powerful – she had a very powerful personality that everyone looked up to. I saw the way that she reacted to people that attempted to cross her and I could see the way that she reacted to that and I was scared’.[178] In reality, the plaintiff did not understand what was happening to her.[179]
[176]Plaintiff, Transcript at 133.1 - 133.3.
[177]Plaintiff, Transcript at 133.4 - 133.12.
[178]Plaintiff, Transcript at 133.20 - 133.25.
[179]Plaintiff, Transcript at 133.26.
In Year 12, the sexual abuse took on the guise of Leifer teaching the plaintiff about marriage.[180]
[180]Plaintiff, Transcript at 136.24 – 137.1.
The sexual exploitation continued in exactly the same way the year after the plaintiff finished Year 12, in 2006, when she returned to the School employed (by Leifer) as a teacher. The plaintiff was 18 at the end of Year 12. The abuse continued throughout the summer before teaching and then increased during the year that she was teaching at the School.[181] The plaintiff taught at the School for approximately eight months until she was married in September of 2006 and left with her husband for Israel.[182]
[181]Plaintiff, Transcript at 135.23 - 135.26.
[182]Plaintiff, Transcript at 135.28 - 135.30.
The sexual misconduct of Leifer detailed by the plaintiff is disturbing. The abuse continued over a period of approximately three years. I was impressed by the plaintiff as a witness. I accept that, because of her extremely sheltered background, she did not understand what was happening to her, particularly as to whether it was right or wrong. The plaintiff was extremely vulnerable. That the sexual abuse occurred under the guise of Jewish education by the headmistress of the School and person in charge of Jewish Studies makes the breach of trust associated with the abuse monstrous. The evidence of the plaintiff’s fear, uncertainty and mental disturbance over the period of time the abuse occurred and since is readily acceptable. I deal with medical reports and issues of causation concerning the injuries sustained by the plaintiff as a consequence of the abuse later in these reasons.
Duty of care
The School, in its Second Further Amended Defence, admitted ‘it owed a duty to take reasonable care to prevent foreseeable injury to the plaintiff as a student at the School’.[183] Mr Blanden, when asked as to the nature of the duty referred to in the Defence, said it was a ‘non-delegable duty’.
[183]Second Further Amended Defence at [5].
The plaintiff, as I understand the submissions and pleadings, also maintains that, ‘in the alternative’, the School is vicariously liable as the employer of Leifer for her actions.[184]
[184]Third Further Amended Statement of Claim at [11].
I will return to issues of duty of care, breach and vicarious liability in due course.
Direct liability
The primary submission of the plaintiff concerning liability put by Mr D.F. Hore-Lacy QC, senior counsel for the plaintiff, was that the role, function, conduct and scope of authority of Leifer was such that she was the mind and will of the School, that it can be said the acts of Leifer are the acts of the School itself and, as such, the School is directly liable for her conduct.
On behalf of the School, Mr Blanden submitted that the evidence could not support a finding Leifer was the embodiment of the School – the administrative structure and her responsibilities did not support such a finding. Importantly, it was not contended that the concept of direct liability was not applicable to the circumstances of this matter. The School’s Defence is solely based on the contention that Leifer was not ‘the embodiment of the AIS Inc (the School)’ – a question of evidence.
Mr Hore-Lacy referred me to the decision of the New South Wales Court of Appeal in Nationwide News Pty Ltd v Naidu & Anor; ISS Security Pty Ltd v Naidu & Anor (‘Nationwide News’).[185] Mr Naidu was employed by ISS Security Pty Ltd. By a contract between ISS Security and Nationwide News, Mr Naidu’s services were made available to Nationwide News. Mr Naidu alleged he was subjected to humiliating and harassing treatment by a Mr Chaloner, the fire and safety officer for Nationwide News whilst providing security services at the premises of Nationwide News. Mr Naidu pleaded Nationwide News had breached its duty of care to him. One of the issues determined by the Court was whether the conduct of Chaloner could be directly attributed to Nationwide News.
[185](2007) 71 NSWLR 471.
Beazley JA (as she then was) referred to a number of authorities concerning the principle of direct liability, observing they had been consistently applied in Australia. She set out a passage from the judgment of Lord Reid in Tesco Supermarkets Ltd v Nattrass (‘Tesco’):
A corporation…must act through living persons, though not always one or the same person. Then the person who acts is not speaking or acting for the company. He is acting as the company and his mind which directs his acts is the mind of the company. There is no question of the company being vicariously liable. He is not acting as a servant, representative, agent or delegate. He is an embodiment of the company or, one could say, he hears and speaks through the persona of the company, within his appropriate sphere, and his mind is the mind of the company. If it is a guilty mind then that guilt is the guilt of the company. It must be a question of law whether, once the facts have been ascertained, a person in doing particular things is to be regarded as the company or merely as the company’s servant or agent. In that case any liability of the company can only be a statutory or vicarious liability.[186]
[186]Nationwide News Pty Ltd v Naidu & Anor; ISS Security Pty Ltd v Naidu & Anor (2007) 71 NSWLR 471, 505 [233] (‘Nationwide News’) quoting Tesco Supermarkets Ltd v Nattrass [1972] AC 153, 170 (‘Tesco’).
Beazley JA then set out matters that resulted in her finding that Chaloner’s position and responsibilities were such that he was the mind and will of Nationwide News so far as the management of its security requirements were concerned. Those matters included that, even though Chaloner reported to a more senior manager, he had a high level of seniority and his role gave him charge of security operations at the firm.[187] In his, ‘appropriate sphere’, the arrangement and implementation of security, he was the embodiment of the company.[188]
[187]Nationwide News (2007) 71 NSWLR 471, 505 [235] (Beazley JA).
[188]Ibid, 505 [236].
Spigelman CJ agreed with Beazley JA that Chaloner was Nationwide News.[189] His Honour stated: ‘It can fairly be said that his act or omission is that of the company itself’.[190] Chaloner was, for all relevant purposes ‘the company irrespective of the existence of lines of authority and reporting to those in the management hierarchy above him’.[191]
[189]Ibid, 488 [84].
[190]Ibid, 488 [85] citing Wilmer LJ in Arthur Guiness, Son & Co (Dublin) Ltd v The Freshfield (Owners) (the “Lady Gwendolen”) [1965] P 294, 343.
[191]Nationwide News (2007) 71 NSWLR 471, 488 [86].
In Christian Youth Camps Ltd v Cobaw Community Health Services Ltd (‘Christian Youth Camps’),[192] the Victorian Court of Appeal considered whether the conduct of an employee could be attributed to his or her employer company in order to find that the employer company itself had engaged in discriminatory conduct under the Equal Opportunity Act 1995. In finding that the conduct of the employee could be attributed to the employer, Maxwell P cited Nationwide News with approval, concluding that the employee represented the ‘mind and will’ of the business he was there considering.[193] Neave JA accepted the principle of direct liability and stated that in such circumstances ‘[t]he employer will be liable for the wrongful act even if the employer could not have been held vicariously liable because the act fell outside the scope of the employee’s course of employment …’.[194]
[192](2014) 308 ALR 615 (‘Christian Youth Camps’).
[193]Ibid, [116].
[194]Christian Youth Camps (2014) 308 ALR 615, [370] (Neave JA) citing Tesco [1972] AC 153.
Before considering whether the position of Leifer was such that her conduct should be attributed to the School, it is important to clarify the theoretical basis on which such a finding of direct liability may be made. While I agree with the conclusion in Nationwide News, on one reading it appears to stand for the proposition that when a natural person represents the ‘mind and will’ of a company, the conduct of that person will necessarily be attributed to the company; that is the submission of Mr Hore-Lacy. With respect, and without making any assumptions as to whether or not Spigelman CJ or Beazley JA meant to convey this, this is not the state of the law of attribution in Victoria.
The authorities cited in Nationwide News do not expound a rule of attribution that will apply in all circumstances. Rather, these cases provide a framework for determining when the conduct of a natural person should be attributed to a company. As observed by the Privy Council in Meridian Global Funds Management Asia Ltd v Securities Commission (‘Meridian’),[195] in each of these cases the courts determined that the conduct of a natural person should be attributed to the defendant company ‘as a matter of interpretation or construction of the relevant substantive rule’.[196]
[195][1995] 1 AC 500.
[196]Ibid, 507.
So, for example, in Lennard’s Carrying Co Ltd v Asiatic Petroleum Co Ltd,[197] the House of Lords held that ‘upon a true construction’ of s 502 of the Merchant Shipping Act 1894 (UK), the fault of the managing director should be attributed to the defendant company.[198] Similarly, in Tesco, the House of Lords held that the conduct of shop managers should not be attributed to the defendant company because to do so would ‘be to render the defence [pursuant to s 24(1) of the Trade Descriptions Act 1968 (UK)] nugatory and so thwart the clear intention of Parliament in providing it’.[199]
[197][1915] AC 705.
[198]Ibid, 713 (Viscount Haldane L.C.).
[199]Tesco [1972] AC 153, 203 (Lord Diplock).
In Meridian, the Privy Council held that these were ‘exceptional cases’ in which the courts attributed the conduct of a natural person to a company because the law in question was intended to apply to companies in those circumstances.[200] These decisions were made despite the fact that the primary rules of attribution[201] and the general principles of agency and vicarious liability did not require this result.[202] In these exceptional cases, the Privy Council held that:
…the court must fashion a special rule of attribution for the particular substantive rule. This is always a matter of interpretation: given that it was intended to apply to a company, how was it intended to apply? Whose act (or knowledge, or state of mind) was for this purpose intended to count as the act etc. of the company? One finds the answer to this question by applying the usual canons of interpretation, taking into account the language of the rule (if it is a statute) and its content and policy.[203]
[200]Meridian [1995] 1 AC 500, 507.
[201]Namely, those rules set out in a company’s constitution and implied by company law by which conduct of employees will be attributed to a company.
[202]Meridian [1995] 1 AC 500, 507.
[203]Ibid.
Meridian was accepted as a ‘correct’ statement of the law of attribution in Victoria in Director of Public Prosecutions Reference No. 1 of 1996[204] by Callaway JA, with whom Phillips CJ and Tadgell JA agreed.[205] In line with Meridian, many cases in Australia have found that a company is directly liable for the conduct of its employees on the basis of the intended application of the substantive law in question.[206]
[204][1998] 3 VR 352.
[205]Ibid, 355.
[206]See for example Christian Youth Camps (2014) 308 ALR 615, 637 [99] and 638 [101] (Maxwell P) and 693 [370] (Neave JA); Director General, Department of Education and Training v MT (2006) 67 NSWLR 237, 242 [17] (Spigelman CJ); North Sydney Council v Roman (2007) 69 NSWLR 240, 252-253 [43] (McColl JA).
Therefore, rather than expounding a particular rule of attribution that will apply in all cases, these authorities have created a ‘framework for analysis’ of corporate liability.[207] As stated by the Privy Council in Meridian, it is a ‘question of construction rather than metaphysics’.[208] Applying this framework to the present case, I must assess whether (and if so, in what way), the policy and content of the common law rule of negligence requires that the conduct of Leifer be directly attributed to the School.[209] As stated by McHugh JA in Hawkins v Clayton,[210] the principle objects of the law of torts are:
In relation to future medical expenses, I have already referred to the evidence indicating the need for the plaintiff to continue with treatment, counselling and medication.
Professor Dennerstein stated an allowance of $60 per month should be allowed for medication ‘and she will likely to remain on this for the foreseeable future’.[368] Professor Dennerstein recommended a six monthly review with a psychiatrist at a cost of $350 per hour.[369]
[368]PX-45 (Report of Professor Dennerstein dated 6 March 2015) at 10.
[369]Ibid.
No evidence was adduced in the plaintiff’s case as to the cost of counselling. Professor Dennerstein raised the question in her report as to whether there is any cost associated with attending sessions with Ms Mass. No evidence was adduced to support any such claim. In addition, no evidence was adduced to support the cost of attending a psychologist.
The submissions on behalf of the plaintiff contended I should allow the cost of medication and psychiatric review for five years. This, so it was contended, would not necessarily be for ‘consecutive weeks but across the plaintiff’s lifetime to meet the needs from time to time’.[370] This submission, in my opinion, does not properly represent the evidence that I have previously referred to and underestimates the likely future needs of the plaintiff. That evidence supports a finding that many of the symptoms the plaintiff now experiences will remain with her for the rest of her life. The plaintiff has now been on medication for a number of years and continues to take antidepressant medication, even though the severe symptoms of depression are in remission. The likelihood of continuing symptoms and the real vulnerability of the plaintiff to relapse into depression, in my opinion, make a figure of 25 years more appropriate. Thus, my calculations on this basis are as follows - $60 a month for medication converts to $13 a week; $700 a year for psychiatrist consultations converts to $13 per week. Thus, I allow $26 a week for 25 years. The 5% multiplier for 25 years is 753, and the multiplication equals $19,578. I discount this figure by 15% to reach a total figure of $16,641.
[370]Submissions on Behalf of the Plaintiff at [7], 20.
Exemplary/aggravated damages
The plaintiff claims exemplary/aggravated damages against both Leifer and the School. During the course of final submissions, Mr Hore-Lacy sought leave to amend the particulars of exemplary/aggravated damages ‘by adding in effect what’s set out in the [final] submissions’.[371] During the course of submissions, this application was refined to a request to add one particular that concerned the School facilitating Leifer’s removal from the jurisdiction. As this issue had been the subject of evidence and Mr Blanden could not point to any prejudice, I permitted the amendment.
[371]Hore-Lacy, Address, Transcript at 674.8 - 674.9.
The Third Further Amended Statement of Claim provided particulars of exemplary damages only. The pleading is as follows:
14.And the plaintiff claims damages including aggravated and exemplary damages.
PARTICULARS OF EXEMPLARY DAMAGES
The first defendant’s breach of trust and exploitation of the plaintiff, when she was a parent herself, was a disgrace which demanded condign punishment. Her behaviour was predatory and was compounded by the fact that the abuse by the first defendant was systematic. The plaintiff was one of a number of young girls who had been corrupted in the same [sic] was with catastrophic repercussions. The first defendant took advantage of the plaintiff’s background by insinuating herself into the plaintiff’s trust. The second defendant’s lack of any supervision and control of the first defendant is deserving of condign punishment.
Facilitating or organising the hasty removal of the first defendant from the country within 48 hours of the second defendant being apprised of allegations concerning the first defendant’s sexual abuse of children at the school.
The submission of the School concerning exemplary/aggravated damages is that its conduct could not be described as deliberate, intentional or amounting to a reckless disregard of the plaintiff’s rights.[372]
[372]Blanden, Transcript at 671.1 - 671.4.
The nature and purpose of exemplary damages were described by the Victorian Court of Appeal, summarising relevant authorities, as follows:
Exemplary damages are damages over and above those necessary to compensate the plaintiff. They are awarded to punish the defendant. They are intended to act as a deterrent to the defendant, and to others minded to behave in a like manner. They are also intended to demonstrate the court’s disapprobation and denunciation of such conduct. Such damages may be awarded in respect of any tort that is committed in circumstances involving a deliberate, intentional, or reckless disregard of the plaintiff’s rights.[373]
[373]Carter & Anor v Walker & Anor [2010] VSCA 340, [284] (Buchanan, Ashley, Weinberg JJA).
In Backwell v AAA (‘AAA’), Ormiston JA, with whom Brooking JA agreed, commented on the need for restraint in any award of exemplary damages.[374] Ormiston JA then considered whether, in awarding exemplary damages, the award of compensatory damages should be taken into account. His Honour determined that compensatory damages should be taken into account:
In this respect there seems nothing in the authorities which would deny consideration of the amount which the defendant will have to pay by way of compensatory damages, if they are sufficient to inflict adequate punishment. Such a principle may be seen to be more apposite where the damages are wholly or in part at large, such as in defamation, trespass, false imprisonment and the like and it may be less easy to apply where the ordinary damages are not at large, as in the present case. But in each case the question emphasised in all the authorities is that exemplary damages must be calculated by considering what is appropriate to punish the defendant, whereas compensatory damages are calculated upon the basis of what is sufficient to satisfy the plaintiff’s claim. It is recognised that the plaintiff obtains a windfall benefit but that that is not inappropriate if it is necessary to punish the defendant for his or her conduct. It is said to act as a general deterrent but nevertheless a deterrent which is appropriate to the defendant’s own behaviour and situation. If the ordinary damages already awarded are sufficient to impose a punishment, then the plaintiff cannot fairly complain if no more is added.[375]
[374][1997] 1 VR 182, [205] (‘AAA’).
[375]AAA [1997] 1 VR 182, [207] - [208].
It is convenient to deal with the plaintiff’s claim for exemplary damages as it concerns the School. There is no evidence that the Board was aware of Leifer’s sexual abuse of the plaintiff or other students at the School until the very end of Leifer’s tenure when the allegations were first raised by Mrs Bromberg.
Whilst I have determined that the Board invested in Leifer great power and control in her position as headmistress of the girls’ campus, that conduct was not such that it could be described as deliberate, contumelious or, within the context of punitive damages, reckless. However, the conduct of the Board in arranging for Leifer to leave the jurisdiction falls into a different category. I have set out the circumstances concerning the departure of Leifer to Israel at [39] – [63] of these reasons.
I summarise as follows. Leifer departed Australia in circumstances where representatives of the Board appreciated there was a case for her to answer concerning allegations of serious criminal conduct, being the sexual abuse of students at the School. At the time of her departure, the President of the Board, Mr Benedikt, was aware of at least eight separate allegations of sexual misconduct involving Leifer and girls at the School, in addition to the initial complaint. The allegations amounted to Leifer being a serial sexual abuser.
The misconduct of Leifer was reported on Friday evening, 29 February. Leifer was stood down or resigned from her position at the School during the course of a meeting on the evening of Wednesday 5 March. The travel agent, Ms Koniarski, was asked to arrange airline tickets to allow Leifer and members of her family to depart Australia urgently between 9.00pm and 10.00pm that evening. Mrs Ernst, the wife of the Board member Mr Ernst, was involved in purchasing these tickets. Leifer and members of her family departed from Melbourne Airport at 1.20am on Thursday 6 March.
The meeting of Wednesday 5 March was held at the home of Mr Izzy Herzog. Mr Ernst was at the meeting with Mr Benedikt. Barrister Mr N. Rosenbaum was also in attendance. Current School Principal, Professor Herszberg, stated that Messrs Benedikt and Ernst were acting on behalf of the Board at this meeting. Mr Benedikt was not called to give evidence and his absence was not explained. The School reimbursed an Adass community member, Mr Klein, and a company associated with Mr Benedikt for the costs of the travel of Leifer and her family members.
The police were not informed of the allegations of sexual abuse prior to Leifer’s departure from the country. In fact, it is likely that the police initiated contact with the School after The Age newspaper published a report on 14 March 2008 concerning allegations that Leifer had sexually abused girls at the School.
If the evidence of Mr Rosenbaum is to be believed, he was not informed or consulted concerning the decision to urgently arrange for the departure of Leifer, even though he was in attendance at the meeting on 5 March when this decision was made.
There can be no more serious charge levelled against the headmistress of a girls’ school than that such headmistress has abused the trust reposed in her by sexually abusing those in her charge. The urgency of Leifer’s departure was not explained in any satisfactory way. I do not accept the evidence of Professor Herszberg, who was not directly involved in the decision to stand Leifer down or pay for her airfares to Israel, that the decision to fund her airfares was consistent with a ‘legal obligation’ owing to her. Any legal obligation (and I do not accept there was one) to pay for her departure from the country does not defeat an obligation to ensure allegations of the commission of serious criminal offences are properly investigated. Further, in such circumstances, the alleged perpetrator should not be assisted to urgently flee the jurisdiction. The failure of the Board to report the allegations to police prior to arranging Leifer’s urgent departure is deplorable.
The conduct of the Board is deserving of the Court’s disapprobation and denunciation. I have no doubt that the conduct was deliberate; as Mr Ernst said in evidence, the seriousness of the allegations against Leifer were such that there was a need to stand her down ‘as quick as possible’.[376] The speed in standing her down was matched by the speed of the arranged departure. The conduct of Messrs Benedikt and Ernst on behalf of the Board in facilitating the urgent departure of Leifer was likely motivated by a desire to conceal her wrongdoing and confine and isolate the conduct and its consequences to within the Adass community. I am reinforced in this view by the apparent failure of Messrs Benedikt and Ernst to obtain any legal advice from Mr Rosenbaum, despite his proximity, as to the appropriateness of organising Leifer’s urgent departure from this jurisdiction.
[376]Plaintiff, Transcript at 266.23.
It is apparent that either it was not a priority for Messrs Benedikt or Ernst that Leifer answered to the criminal law of this State or that this State’s jurisdiction was deliberately flouted; upon consideration of the manner in which the School arranged for Leifer’s departure from the country I find the deliberate flouting of jurisdiction the most likely motivation. The unexplained failure of the School to call Mr Benedikt entitles me to draw this inference and make conclusions on this aspect with greater certainty. The conduct amounts to disgraceful and contumelious behaviour demonstrating a complete disregard for Leifer’s victims, of which the plaintiff was one. The conduct demonstrates a disdain for due process of criminal investigation in this State.
I have awarded the plaintiff $1,024,428 in compensatory damages. Whilst damages for pain and suffering, loss of enjoyment of life are ‘at large’ in the sense referred to by Ormiston JA in AAA,[377] I do not consider that the compensatory damages sufficiently impose a punishment on the School for the conduct I have previously described as deplorable. The assessment of compensatory damages may be considered substantial, but that sum is appropriate in my view because of the significant injury sustained by the plaintiff and much of that total sum is made up of ‘ordinary damages’ which are ‘not at large’.[378] I also take into account that an award of exemplary damages is directed at deterring this defendant and others from similar conduct. I consider the circumstances of this case, both for this defendant and for others in similarly responsible positions, mean that deterrence is an important factor for me to take into account. I do not consider the award of compensatory damages is sufficient for the purpose of deterrence. Further, in determining a sum appropriate for punitive damages, I bear in mind that I have found the School directly liable for Leifer’s serious misconduct. In so far as this finding may be seen as incorporating an element of punishment, it does not adequately address the School’s misconduct in respect of this matter. In my opinion, a figure of $100,000 appropriately reflects the considerations of punishment and deterrence in relation to the School’s disgraceful conduct.
[377][1997] 1 VR 182, [207] - [208].
[378]Ibid.
I turn now to consider the claim for exemplary damages against Leifer.
The evidence overwhelmingly demonstrates that Leifer had a contumelious disregard for the plaintiff’s rights. I have described Leifer’s conduct previously as a massive breach of trust, yet this description does not adequately set out the destructive and evil nature of her sexual abuse of the plaintiff over a period of years. The evidence discloses the sole motivation of Leifer in her dealings with the plaintiff was for her own sexual gratification. Leifer used her position of control, power and authority within the School to manipulate the plaintiff’s sense of vulnerability concerning her family situation so as to create the opportunity for further abuse. The conduct of Leifer can be described as wanton, carried out in complete disregard of the plaintiff’s rights and welfare. It is conduct deserving of this Court’s disapprobation; it is conduct that is deserving of damages to punish Leifer and deter others from similar conduct.
As stated, the award of compensatory damages in this case, in my view, does no more than provide adequate compensation to the plaintiff. I do not consider the amount of compensatory damages carries with it any substantial element of deterrence, or punishment. As Ormiston JA stated, ‘[i]n truth each case must be looked at on its own merits’.[379] In considering the merits of the case against Leifer I consider her conduct warrants punishment; in awarding exemplary damages against Leifer I have particular regard to deterrence, both deterrence to Leifer but also importantly to others in like positions of authority and trust minded to act in a similar manner. I consider the circumstances of this matter warrant the making of an award of exemplary damages against Leifer. I fix the sum of $150,000.
[379]AAA [1997] 1 VR 182, [209].
It is clear on the authorities that it is appropriate for me to enter judgment for different awards of exemplary damages against each of the defendants.[380] As to aggravated damages, it is appropriate in this case because ‘the aggravation of the harm done, and the humiliation caused to the [plaintiff]’ is different as regards each defendant.[381]
[380]De Reus & Ors v Gray [2003] VSCA 84, [27] (Winneke P, with whom Ormiston and Charles JJA agreed).
[381]Ibid, [32] (Winneke P, with whom Ormiston and Charles JJA agreed).
Mitigation of damages
On 15 May 2015, the final day of hearings, I granted leave to the School to amend its defence to plead that the plaintiff has failed to mitigate her loss. The School submits that if I was to determine that the plaintiff, in the circumstances, has failed to act as a reasonable person should to ensure she minimised her loss, that failure will be reflected in a reduction of the plaintiff’s award of damages.
The Second Further Amended Defence pleads mitigation of loss as follows:
16.Further the second defendant says that the plaintiff has failed to mitigate her loss.
PARTICULARS
The plaintiff lodged a claim for compensation under the Accident Compensation Act 1985 which was received on 4 April 2014.
The plaintiff was eventually notified her claim for weekly payments and medical and like expenses was accepted by letter from CGU Workers Compensation dated 10 April 2014.
That letter noted that the plaintiff’s employer was Adass Israel Congregation Talmud Torah and that the date of injury was 1 November 2006.
By a further letter dated 7 May 2014 the plaintiff was notified that CGU Workers Compensation had calculated her entitlement to weekly payments based on the information provided by Adass Israel Congregation and that her pre-injury average weekly earnings was $128.
The plaintiff has not taken any other steps such as submitting accounts to CGU Workers Compensation to enable payments to be made to her for medical and like expenses or weekly payments.
No explanation has been given by the plaintiff for her failure to take these steps.
It is to be noted that this pleading does not in any way go to the manner, methodology or basis upon which it is apparently suggested an entitlement to statutory compensation is to be taken into account in this proceeding if it be found the plaintiff failed to mitigate her loss.
The School subpoenaed a file from CGU Insurance and tendered documents from that file.[382] These documents included:
(a)letter from CGU to the plaintiff dated 10 April 2014 indicating CGU has accepted the plaintiff’s claim for weekly payments and medical and like expenses. The date of injury is noted as 1 November 2006;
(b)letter from CGU to the Congregation – Mr Nussbacher – dated 10 April 2014 indicating that CGU has accepted the plaintiff’s claim for weekly payments and medical expenses;
(c)letter from CGU to the plaintiff dated 7 May 2014 stating CGU has calculated the plaintiff’s entitlement to weekly payments based on pre-injury average weekly earnings taken from the payroll for the period 22 January 2006 to 30 November 2006 supplied by the Congregation. The weekly sum was calculated at $130 gross per week; and
(d)letter from CGU to the Congregation – Mr Nussbacher – dated 7 May 2014 advising of the calculation of the plaintiff’s weekly payment entitlement.
[382]See DX-12 (Various documents from CGU Workers Compensation file dated 10 April 2014 and 7 May 2014).
I granted leave to Mr Hore-Lacy to call Mr Thomas McCredie, the plaintiff’s solicitor, with knowledge of the compensation claim after the tender of the above material on 13 May 2015, the last day of evidence in the trial. Mr McCredie stated that the claim was suspended pending this Supreme Court claim being determined.[383] He had no knowledge of the plaintiff receiving any payments of compensation.[384] The suspension of the claim occurred in a conversation between Mr McCredie and the CGU Case Manager.[385]
[383]McCredie, Transcript at 608.13 - 608.15.
[384]McCredie, Transcript at 606.28.
[385]McCredie, Transcript at 607.8 - 607.9.
The School contends these documents, taken with medical evidence before me in this proceeding:
… establishes that part of [the plaintiff’s] psychiatric injury arose during her period of employment as a religious studies teacher by the Congregation. Section 82(2C) of the Accident Compensation Act establishes that a person who suffers an aggravation of pre-existing injury where employment was a significant contributing factor will be entitled to compensation under the Act. The medical evidence adduced by the plaintiff supports this proposition. If the plaintiff submitted receipts to CGU Workers Compensation, it is likely that both medical expenses and loss of earnings payments will be made to the plaintiff. The medical expenses to be submitted are the same expenses that the plaintiff is claiming payment for in this proceeding, that is treatment for psychological injuries.[386]
[386]Second Defendant’s Outline of Closing Submissions at [42].
A fundamental problem with the pleading and submissions of the School is that, even if I were minded to accept on a general basis that the plaintiff has failed to mitigate her loss, I have no basis to determine on the particulars or the evidence what that loss amounts to. The submissions of the School fail to address this point, apart from the vague assertion that ‘medical expenses and loss of earnings payments will be made to the plaintiff. The medical expenses to be submitted are the same expenses that the plaintiff is claiming payment for in this proceeding, that is treatment for psychological injuries’. It is not for me to speculate whether CGU would accept any or all of the medical expenses claimed in this proceeding. Past medical expenses total $156,007. The claim goes back to 2010. I was not addressed in any way on this issue.
The tendered materials upon which the School’s pleading and submission is based do not identify ‘the work-related injury or illness’ for which CGU admitted a liability for weekly payments and medical and like expenses.[387] No claim form has been tendered, no medical report concerning any injury or illness said to have arisen as a consequence of the employment and supporting the claim has been produced. In the correspondence tendered, the date of injury is referred to as 1 November 2006. There is no evidence of what that injury is or how it was sustained. It is not possible to determine what ‘part’ of the plaintiff’s psychiatric injury, to use the words of the School’s submission, can be attributed to employment with the School. The particulars in the Second Further Amended Defence do not refer to the nature and cause of the injury at all. Section 82(2C) of the Accident Compensation Act relevantly states:
(2C)There is no entitlement to compensation in respect of the following injuries unless the worker’s employment was a significant contributing factor to the injury –
…
(c)a recurrence, aggravation, acceleration, exacerbation or deterioration of any pre‑existing injury or disease.
[387]DX-12.
The School contends that the medical evidence adduced by the plaintiff in this case supports the proposition that the plaintiff’s employment was a significant contributing factor to an aggravation of her pre-existing psychiatric injury. This submission does not properly represent the evidence of Professor Dennerstein. I have set out the opinion of Professor Dennerstein as to the contribution of the sexual abuse committed by Leifer on the plaintiff during the course of the plaintiff’s employment in 2006. Professor Dennerstein, in her final answer reproduced above,[388] stated the abuse over the year of employment made no difference to the plaintiff’s psychiatric injury. Rather than support the proposition that the period of employment was a significant contributing factor to an aggravation of the plaintiff’s psychiatric injury (if that be that injury which is the subject of the WorkCover claim), the evidence of Professor Dennerstein in fact provides a basis for the WorkCover Agent, CGU, to contest any entitlement to compensation under the statutory scheme because that employment was not ‘a significant contributing factor’.
[388]See Reasons at [175].
Mr Blanden referred me to the New South Wales Court of Appeal decision of Downes v Amaca Pty Ltd and specifically to the judgment of Campbell JA:
In my view, it remains the law that if a worker has a legal right to apply for to a benefit under the Workers Compensation (Dust Diseases) Act, but has not applied for that benefit, the present value of that benefit can be deducted from damages only if either:
(i)there is a finding that the worker is likely to apply for the benefit and would then obtain it, or
(ii)there is a finding that the failure of the worker to apply for the benefit is, or would be, an unreasonable failure to mitigate damages.[389]
[389](2010) 78 NSWLR 451, [116].
I accept the view of his Honour was applicable to the circumstances of the case before him, which concerned benefits under the Workers Compensation (Dust Diseases) Act 1942 (NSW); but the circumstances of the matter before me do not enable a finding under either limb. I have no basis on the evidence to establish the ‘present value’ of any benefit to be deducted from any award of damages, no evidence to base a finding that the plaintiff is likely to apply for the benefit and, in the context of the medical evidence before me, in the current proceeding, which undermines any entitlement the plaintiff may have under s 82(2C) of the Accident Compensation Act, I cannot find it is unreasonable not to have pursued the claim.
Insofar as the authorities relied upon by Mr Blanden suggest I apply Malec v Hutton principles to the hypothetical events around the payment of compensation,[390] the absence of any evidence concerning the nature of the claim made by the plaintiff to CGU, the absence of any evidence concerning what entitlements over what period of time the plaintiff may be entitled to and for what injury does not allow any proper basis for the assessment of contingencies.
[390]Downes v Amaca Pty Ltd (2010) 78 NSWLR 451, [22] (Basten JA). Such a course was not part of the School’s submissions.
The onus of proof in relation to failure to mitigate loss lies with the School. The School has failed to discharge the onus required.
Conclusion
To summarise, I find that the School is:
(a) Directly liable; and
(b) Vicariously liable
for the conduct of Leifer.
I award damages:
(a) Non-economic loss: $300,000
(b) Economic loss, past: $50,358
(c) Economic loss, future: $501,422
(d) Medical expenses, past: $156,007
(e) Medical expenses, future: $16,641
I award exemplary damages:
(a) Against Leifer: $150,000
(b) Against the School: $100,000
15
5
10