Gera v Commonwealth Bank of Australia Ltd
[2010] FMCA 205
•30 March 2010
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| GERA v COMMONWEALTH BANK OF AUSTRALIA LTD | [2010] FMCA 205 |
| INDUSTRIAL LAW – Australian Workplace Agreement – termination of employment – whether breach of Australian Workplace Agreement – whether allegations of misconduct – whether allegations of misconduct raised – whether an investigation – whether proper investigation – principles in workplace policies and statements – procedural and substantive fairness. CONTRACT – Implied term of contract – whether implied term of mutual trust and confidence between employer and employee. TORT – Alleged interference with contractual relations – elements – whether any damage proved. |
| Industrial Relations Act 1988 (Cth), s.170DC Interpretation Act 1984 (WA), s.56 Workplace Relations Act 1996 (Cth), ss.326(3), 643, 659, 721, 824 |
| Allstate Life Insurance Co v ANZ Banking Group Ltd (1995) 58 FCR 26 Cameron’s Unit Services Pty Ltd v Kevin R Whelpton & Associates (Australia) Pty Ltd (1984) 4 FCR 428 Clouston and Co v Corry [1906] AC 122 |
| The Concise Oxford Dictionary of Current English (7th Edn) (Oxford: Clarendon Press, 1984) BA Garner, A Dictionary of Modern Legal Usage (1987, Oxford University Press, Oxford) RP Balkin and JLR Davis, Law of Torts (3rd Edn) (2004, LexisNexis Butterworths, NSW) |
| Applicant: | DUANE CHRISTOPHER MICHAEL GERA |
| Respondent: | COMMONWEALTH BANK OF AUSTRALIA LTD |
| File Number: | PEG 59 of 2008 |
| Judgment of: | Lucev FM |
| Hearing date: | 17-21 November 2008 |
| Date of Last Submission: | 21 November 2008 |
| Delivered at: | Perth |
| Delivered on: | 30 March 2010 |
REPRESENTATION
| Counsel for the Applicant: | Mr D Howlett |
| Solicitors for the Applicant: | Bruce Havilah & Associates |
| Counsel for the Respondent: | Mr K J de Kerloy |
| Solicitors for the Respondent: | Freehills |
ORDERS
That the application be dismissed.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT PERTH |
PEG 59 of 2008
| DUANE CHRISTOPHER MICHAEL GERA |
Applicant
And
| COMMONWEALTH BANK OF AUSTRALIA LTD |
Respondent
REASONS FOR JUDGMENT
Introduction
On 4 December 2006 Duane Gera went to lunch at the Blue Point Cafe in McMahons Point, a harbour-side Sydney suburb. He took with him Elina Winnel. Mr Gera and Ms Winnel ate, and drank wine. At the time Mr Gera was employed as State Sales Manager, WA with the Commonwealth Bank of Australia,[1] and was visiting Sydney from Perth. Ms Winnel was a probationary employee with the Bank. Mr Gera was responsible for mentoring Ms Winnel, and part of the purpose of Mr Gera’s visit to Sydney was to mentor Ms Winnel, whom he had not previously met. After lunch, rather than returning to the offices of the Bank in Sydney, Mr Gera and Ms Winnel resorted to the Radisson Plaza Hotel[2] in O’Connell Street, Sydney, and, in particular, to Mr Gera’s hotel room.[3] They drank more wine, and joined in a meeting[4] at the Bank offices in Sydney by telephone, and after the Team Meeting concluded, continued drinking wine. What then happened is disputed, but the Bank ordered an investigation into an incident which allegedly occurred in the Hotel Room involving Mr Gera and Ms Winnel. Following that investigation Mr Gera’s employment was terminated for misconduct on 23 February 2007.
[1] “the Bank”.
[2] “the Hotel”.
[3] “Hotel Room”.
[4] “Team Meeting”.
Mr Gera now alleges that the termination was in breach of:
a)his Australian Workplace Agreement;[5] and
b)an implied term of good faith and mutual trust and confidence in his contract of employment with the Bank,
and that the Bank has committed the tort of interference with contractual relations between Mr Gera, his clients and future employers.
[5] “AWA”.
Application and response
The grounds of the application, made under s.721 of the Workplace Relations Act 1996 (Cth),[6] are as follows:
a)that Mr Gera was employed by the Bank under the terms of an AWA dated 20 October 2004;
b)that the Bank summarily terminated Mr Gera’s employment on 23 February 2007 in breach of the express terms contained, among others, in clauses 15 and 16 of the AWA, and in breach of an implied term of good faith and mutual trust and confidence; and
c)that the Bank committed the tort of interfering in contractual relations between Mr Gera, his clients and his future employers.
[6] “WR Act”.
Mr Gera seeks orders for damages for the alleged breaches of the AWA and the implied term of good faith and for the alleged interference in contractual relations, and penalties.
The Bank opposes the making of the orders sought by Mr Gera, and denies:
a)summarily terminating Mr Gera’s employment in breach of express terms of the AWA;
b)the existence of an implied term of good faith and mutual trust and confidence in the AWA, or in the contract of employment between the Bank and Mr Gera, or that it summarily dismissed Mr Gera in breach of an implied term of good faith and mutual trust and confidence; and
c)committing the tort of interference with contractual relations between Mr Gera, his clients and future employers.
Section 721(1) of the WR Act provides as follows:
A party to a ITEA who suffers loss or damage as a result of a breach of the ITEA by the other party may recover the amount of the loss or damage in an eligible court.
There is no dispute that s.721(1) applies to Mr Gera’s AWA, as if it were an ITEA.[7]
[7] WR Act, s.326(3).
Issues
The issues in this matter are:
a)did the Bank breach Mr Gera’s AWA on terminating his employment, and if so, is the Bank liable to pay damages or a penalty?;[8]
b)was there an implied term of good faith and mutual trust and confidence in Mr Gera’s contract of employment, and if so was it breached leading up to Mr Gera’s termination?; and
c)did the Bank interfere in the contractual relations between Mr Gera, his clients and future employers upon termination, and if so, is the Bank liable to pay damages.
[8] Orders for penalty were not originally specified in the application, but were referred to in the written and oral submissions of both Mr Gera and the Bank.
It is important at the outset to clarify what matters are not in issue in these proceedings, and hence what the proceedings are not about. The proceedings are not about:
a)whether Mr Gera was unfairly dismissed;[9] and
b)whether Mr Gera was unlawfully terminated on a basis proscribed by the WR Act,[10]
and therefore, Mr Gera’s work performance, about which there was much affidavit evidence from him, was not directly relevant.
[9] See WR Act, s.643, providing for such applications to be determined by the then Australian Industrial Relations Commission.
[10] See, for example, WR Act, s.659 concerning certain grounds on which employment is not to be terminated.
The issue of fairness arises however because the terms of the Bank’s Supporting a Fair Workplace Policy[11] apply, and it imports considerations of fairness in the conduct of, and making of recommendations in relation to, any investigation.
Facts
[11] “Fair Workplace Policy”.
Termination of employment
It is not in dispute that Mr Gera’s employment was terminated by the Bank on 23 February 2007 by way of a letter sent to him from Robert De Luca, the Executive General Manager, Corporate Financial Services for the Bank.[12] The Termination Letter relevantly provides as follows:
As you are aware, the Bank has been conducting an investigation into a complaint made against you by Ms Elina Winnel, concerning an alleged incident on 4 December 2006.
On 2 February 2007 the Bank wrote to you and informed you that the following factual findings, based upon the investigation undertaken by it, had been made:
· on 4 December 2006 you sexually/indecently assaulted Ms Winnel in your room at the Radisson Hotel; and
· following that assault you failed to provide Ms Winnel with any assistance or support and left her unattended in your hotel room.
I have had careful regard to all of the matters raised by you, and in particular the matters raised in the correspondence from your solicitors dated 15 February 2007, to which the Bank will respond in due course. Having regard to all of these matters, I have formed the view that you have engaged in conduct which:
· is in breach of the Bank’s Statement of Professional Practice and your contract of employment; and
· amounts to serious misconduct on your part.
On this basis, I have decided that your employment will be terminated with immediate effect. You will be paid your normal salary up until close of business 23 February 2007, together with any accrued statutory entitlements.[13]
[12] Affidavit of Duane Christopher Michael Gera, affirmed 17 April 2008 (“Mr Gera’s First Affidavit”), Annexure 7; “Termination Letter”.
[13] Termination Letter.
The assault and the leaving of Ms Winnel unattended were viewed by the Bank as separate instances of serious misconduct.[14]
[14] Transcript, 19 November 2008, page 275.
Relevant terms of AWA
Relevantly, the AWA provides as follows:
15.Termination
15.1Your employment with the Bank may be terminated:
(a)by agreement in writing between the parties at any time;
(b)by either party giving 4 weeks written notice to the other;
(c)by the Bank without notice on the payment of 4 weeks of your Base Remuneration applying at the time; or
(d)by immediate dismissal, without payment in lieu of notice, in cases of misconduct…
16.Misconduct
16.1If an allegation of misconduct is raised against you, the Bank will investigate the matter, giving you an opportunity to respond.
16.2Misconduct would arise, apart from in other situations, if you failed to observe the Bank’s workplace policies in existence from time to time. These include the Bank’s current Statement of Professional Practice (reproduced in the IBS Employment Manual).
16.3If the Bank is satisfied that your actions or behaviour constitute misconduct, the Bank may implement any one or more of the following disciplinary measures:
(a)written warnings
(b)suspension without pay for a period of up to 1 month
(c)demotion
(d)dismissal with payment in lieu of appropriate notice
(e)in the case of serious misconduct, immediate dismissal, with pay up to the day of termination only.
Clauses 2 and 3 of the AWA provide as follows:
2. Position
You will be employed by the Bank as Manager Business Development in Business Banking, Institutional & Business Services. The duties and responsibilities of this position are outlined in the position description provided to you. In the course of your employment with the Bank, you may be required to undertake other roles or duties, or to work at different locations.
3.Commencement and Term
This agreement will commence on 8 July 2004. It has no set termination date, but your employment with the Bank can be terminated in accordance with the termination clause of this agreement.[15]
[15] A copy of the AWA is annexed to Mr Gera’s First Affidavit, Annexure 1.
There is no dispute that:
a)the AWA was current and ongoing at the time of Mr Gera’s termination of employment on 23 February 2007;
b)the terms of Mr Gera’s employment are set out in the AWA;[16] and
c)Mr Gera was in the position of State Sales Manager, WA as at 4 December 2006.
[16] Mr Gera’s First Affidavit para.3.
Contract of employment
There is a letter dated 14 October 2004 from the Bank to Mr Gera confirming his promotion to the position of Manager Business Development, Premium Business Services, commencing 8 July 2004, and requiring signing of the AWA as a condition of acceptance of the offer. Otherwise, there is no document in evidence which would constitute a written contract of employment. To the extent that there is a contract of employment with terms additional to the AWA, those terms must therefore be implied.
Supporting a Fair Workplace policy
The Bank’s Fair Workplace Policy relevantly provides as follows:
Principles of Fairness
The definition of fairness is quite subjective. What one person sees as fair, another may not. However, people are more likely to agree they are being treated fairly at work when:
· The context or rationale for decisions or actions is understood
· They can see their view has been heard and considered
· The impact of a decision or action affecting them is taken into account
· Task allocation, promotion and reward is based on merit
· Tasks allocated are not manifestly beyond their capability or range of skills
· The balance between work obligations and family or personal commitments is taken into account
· They can constructively express dissatisfaction with a decision or action without fear of reprisal
· Work relationships foster an environment of dignity and trust.
Principles of a fair investigation
A fair investigation should demonstrate:
· Procedural fairness – the grievance handling process itself must be fair
· Substantive fairness – the final decision about outcome of the grievance should be resolved must be fair, i.e. the resolution.
Investigations should be carried out in a timely and sensitive manner, maintaining confidentiality.
Procedural Fairness
Fair Treatment Facilitators (or line management) must conduct formal investigations applying the following principles of procedural fairness:
· To act without bias or pre-judging the issue.
· To provide opportunity for each party to present their own case (starting with the initiator), allowing each party to fully respond to all allegations made.
· To have all relevant considerations taken into account.
· To disregard irrelevant matters.
· To inform individuals about decisions affecting them.
The Recommendation
The decision of the Fair Treatment Facilitator is made in the form of a recommendation to the manager two removed. This decision should take into account the:
· Severity and frequency of the offence
· Weight of the evidence
· Wishes of the team member who raised the issue
· Consistency with the Bank’s People Principles, Clear and decisive, empowered and accountable, learn and grow, trust and team spirit, discipline and excellence, challenge and innovate.
A line manager conducting a In Line Review is advised to submit the completed recommendations of the investigation to their own manager for review and input.[17]
[17] Affidavit of Michael Stephen Carroll, sworn 19 September 2008 (“Mr Carroll’s Second Affidavit”), Annexure MSC 9, “Fair Workplace Policy”.
Statement of Professional Practice
The Bank’s Statement of Professional Practice relevantly provides as follows:
Our profession is founded on very high standards of personal integrity and conduct which requires absolute honesty. These guidelines which are complementary to the Bank’s instruction manuals should be understood and observed by all employees of the Commonwealth Bank and its related entities (“Bank” is used to refer, where appropriate, to all entities in the Bank Group). They reflect the Bank’s core values of honesty, integrity and trust. In performing your duties you should keep uppermost in your mind the need to use commonsense. If you always act honestly, exercise commonsense and are never afraid to ask for help if you are unsure of how to act, you will not encounter any problems in observing the principles contained in this Statement.[18]
Consideration of Issues
[18] “Statement of Professional Practice”, Exhibit R1, documents provided during investigation at tab 7.
Alleged breaches of AWA
The principal issue to be dealt with in this case is whether the Bank breached clauses 15 or 16 of the AWA.
The AWA essentially provides that if an allegation of misconduct is made against an employee, the Bank will investigate the allegation, and give the employee an opportunity to respond.[19]
[19] AWA, clause 16.1.
If the Bank is satisfied that there has been misconduct, the AWA provides for a number of disciplinary measures, including dismissal:
a)with payment in lieu of notice; or
b)immediately, without pay in lieu of notice and with pay up to the day of termination, but only if the misconduct is serious.[20]
[20] AWA, clause 16.3.
In short, the Bank must:
a)investigate any allegation of misconduct against an employee; and
b)if satisfied that the allegation of misconduct has been made out, determine whether or not, in its discretion, any of the disciplinary measures specified, including dismissal for misconduct with pay in lieu of notice, or serious misconduct without pay in lieu of notice, are to be implemented.
In an action alleging breach of the AWA, where misconduct to the satisfaction of the Bank is established, the disciplinary measures imposed are a matter within the Bank’s discretion, provided that immediate dismissal with pay up to the day of termination is only available in cases of “serious misconduct”.
Were there allegations of misconduct?
The first question to be answered is whether or not there was an allegation, or allegations, of misconduct against Mr Gera.
An “allegation” means an “assertion”, especially one as yet “unproved”.[21]
[21] The Concise Oxford Dictionary of Current English (7th Edn) (Oxford: Clarendon Press, 1984) page 24 (“Concise Oxford Dictionary”).
On 8 December 2006 Ms Winnel attended a meeting at the Bank and signed a statement that she had previously emailed to Ian Burnett, the Bank’s General Manager for Broker and Agency Sales in which she said, amongst other things:
a)that she wished to bring to Mr Burnett’s attention “a serious workplace incident … involving Duane Gera which occurred on the afternoon of Monday 4 December 2006”;
b)that following a client meeting, Mr Gera, who was her “assigned mentor and … supervisor for the day” took her to lunch, and “suggested that it would not be appropriate to turn up late” to the Team Meeting scheduled to commence at 3.00pm at the Bank’s Sydney office, and “insisted that we participate in the meeting by telephone from his hotel room at the Raddison, Sydney”;
c)that at Mr Gera’s “direction” she went to the Hotel Room and participated in the Team Meeting by telephone;
d)that whilst she was in the Hotel Room she had “reason to believe that …[she] was the subject of a sexual assault”;
e)that on 5 December 2006, she “sought medical treatment and advice” and was awaiting the results; and
f)she proposed “to lay a complaint concerning Duane Gera to the NSW Police”, and in the circumstances would prefer that the Bank not conduct “a formal investigation” at that stage.[22]
[22] Mr Carroll’s First Affidavit, Annexure MSC 4 (“8 December 2006 Statement”).
Ms Winnel’s request that there be no formal investigation was not binding on the Bank. Clause 16.1 of the AWA provided that “[i]f an allegation of misconduct … [is] raised against you, the bank will investigate the matter.” The use of “will’ in this context denotes a mandatory condition.[23] The Bank was therefore obliged by the terms of Mr Gera’s AWA to investigate any allegation of misconduct against him.
[23] Legally, it usually makes no difference whether ‘will’ or ‘shall’ is used: BA Garner, A Dictionary of Modern Legal Usage (1987, Oxford University Press, Oxford), at page 502. In terms of statutory construction, subject to the context in which the word appears, the use of the word ‘shall’ or ‘must’ to entrust a function is taken prima facie to impose an obligation to exercise that function: Grunwick Processing Laboratories Ltd v Advisory, Conciliation and Arbitration Service [1978] AC 655 at 690 per Lord Diplock and 698 per Lord Salmon; see also Interpretation Act 1984 (WA), s.56, where ‘shall’ is imperative. The meaning of ‘will’ was explored in Rayfield v Hands [1960] Ch 1 at 3 per Vaisey J; where a company’s articles of association provided that the directors ‘will take the said shares equally between them at a fair value’, the word ‘will’ indicates a resultant prospective eventuality, in which the member has to sell his shares and the directors have to buy them, each being under an obligation to bring that eventuality into effect.’
It was seriously and strenuously argued by Mr Gera that no allegation of misconduct was raised with the Bank by Ms Winnel. When the content of the 8 December 2006 Statement is examined, and in particular the references to:
a)“a serious workplace incident”;
b)Ms Winnel having “reason to believe that … [she] was the subject of a sexual assault”;
c)seeking medical treatment and advice (the next day); and
d)laying a complaint with the NSW Police,
there can be no doubt that an allegation of misconduct by Mr Gera was raised with the Bank by Ms Winnel. The allegations included (but were not necessarily limited to) an allegation that Ms Winnel was sexually assaulted by Mr Gera in the Hotel Room.
Much was made by Mr Gera of the fact that Ms Winnel used the phrase “reason to believe”, and it was argued that use of that phrase somehow meant that Ms Winnel was unsure or was hypothesising about what had occurred. However, “reason to believe” is a phrase that postulates belief and the existence of reasons for belief, and has been said (albeit in the context of the belief required for the exercise of a statutory power) to “imply actual belief” if held on reasonable grounds.[24] Having regard to matters discussed in more detail below, particularly in relation to the medical evidence arising from Ms Winnel’s examination on 5 December 2006, Ms Winnel had reasonable grounds for her belief.
[24] WA Pines Pty Ltd v Bannerman (1980) 41 FLR 175 at 186 per Lockhart J.
It was also argued that because Ms Winnel did not request a formal investigation, that that somehow meant that there was no allegation by her. For reasons set out above, that argument has no substance.
In the Court’s view, Mr Gera’s arguments that there was no allegation by Ms Winnel must fail. As a matter of form, substance and common-sense it is evident that Ms Winnel made an allegation, as set out above.
Was there an investigation?
Mr Gera complains that notwithstanding appearances there was in fact no investigation because:
a)Mr Carroll was not qualified to carry out an investigation;
b)there was not really a proper investigation; and
c)the investigation did not comply with the Bank’s Fair Workplace Policy.
Mr Carroll
Mr Carroll is an experienced Bank officer. He has been employed by the Bank since April 1969 in a variety of:
a)capacities;
b)branches; and
c)departments,
within the Bank both in New South Wales and, albeit apparently briefly, in Tasmania. For the first 16 years of his career he performed customer service, inspection and audit, and branch management functions. In 1985 he was appointed as a relieving industrial relations officer in the Bank’s Group Human Resources, and has spent the last 23 years predominantly working in the human resources field in employee relations. Some of that time has been spent in areas of the Bank responsible for inspection and group audit in various branches and departments of the Bank.[25]
[25] Mr Carroll’s First Affidavit, paras.3-4.
Since 2004 Mr Carroll has been employed by the Bank as Executive Manager – Strategic HR Support, Premium Business Services, and in that role is responsible for providing human resources advice to the Bank’s Premium Business Services[26] division as part of the PBS Human Resources Team.[27]
[26] “PBS”.
[27] Mr Carroll’s First Affidavit, paras.1-2.
The investigation was carried out by Mr Carroll who was a vastly experienced officer within the Bank. For the better part of the last 23 years he worked in areas associated with human resources and industrial relations. His experience alone qualified him to carry out this type of investigation, which he attested was carried out in the manner in which investigations of this kind within the Bank were normally carried out. He had conducted investigations of this type previously.[28]
[28] Mr Carroll’s Second Affidavit, para.4.
By reason of his experience within the Bank including his previous experience in conducting similar investigations, and particularly within human resources and industrial relations, Mr Carroll was qualified to conduct this particular investigation.
Investigation
To “investigate” is to “examine, inquire into, study carefully; make official inquiry into.”[29]
[29] Concise Oxford Dictionary, page 528.
Mr Gera complains that there was not a proper investigation, and sought to minutely examine every variable and nuance of the investigation. However, in conducting an investigation, an employer is obliged to act in a practical manner, and not to embark on a judicial hearing or police style examination of the circumstances. In Schaale v Hoechst Australia Limited[30] the Federal Court said as follows:
It would be harsh, unjust and unreasonable for an employer to dismiss an employee summarily on the ground of serious misconduct without taking reasonable steps to investigate those allegations and give the employee a fair chance of answering them: See Gregory v Philip Morris Ltd (1988) 24 IR 397 at 413; Wheeler v Philip Morris Ltd (1988) 32 IR 323 at 346.
In my opinion the respondent’s conduct in this regard did not breach the requirements of the award. The allegation against Mr Schaale was a clear and simple one. Did he breach security by climbing over the fence? The award has to operate “in a practical way in a commercial and industrial environment”: Gregory at 413. Employers are not required to have the skills of police investigators or lawyers. By inspecting the site of the alleged entry and taking statements from potential witnesses it seems to me the respondent acted quite reasonably. In the interview on the following morning the allegation was put very clearly to Mr Schaale and he persisted in an account which the respondent was reasonably entitled to reject.[31]
[30] (1993) 47 IR 249 (“Schaale”).
[31] Schaale at 252 per Heerey J.
Schaale was a judgment given in the context of an alleged breach of an award provision prohibiting harsh, unjust or unreasonable dismissal.
In AWU–FIME Amalgamated Union v Queensland Alumina Ltd[32] the Industrial Relations Court of Australia was dealing with s.170DC of the Industrial Relations Act 1988 (Cth) which provided that an employee could not be terminated unless the employee had been given the opportunity to defend allegations made where the termination was for reasons related to conduct. The Industrial Relations Court observed that:
It can be seen that the obligation this section casts on an employer is to give the employee an opportunity to defend himself or herself against the allegations made. It does not, in terms, require an employer to conduct any investigation it might undertake to a prescribed standard. In the present case the complaint made by the Union is first that the decision to terminate did not involve a consideration of the involvement of Allen and that he may have inflamed the situation before blows were struck. However it is plain that both Merritt and Sonter were given an opportunity to both explain their version of events and to put whatever they wished to McIntosh in defence of the allegation that they had engaged in conduct that might lead to their dismissal. There is nothing about the way in which QAL went about investigating their conduct and deciding to terminate their employment that might suggest a contravention of s 170DC. I agree with the observations of Heerey J in Schaale v Hoechst Australia Ltd (1993) 47 IR 249 at 253 that employers are not required to have the skills of police investigators or lawyers: see also the observations of Wilcox CJ in Nicolson v Heaven and Earth Gallery Pty Ltd (1994) 1 IRCR 199 at 209; 57 IR 50 at 59.[33]
[32] (1995) 62 IR 385 (“Queensland Alumina”).
[33] Queensland Alumina at 390-391 per Moore J.
Although the above authorities relate to the statutory provisions concerning harsh, unjust or unreasonable, or unfair, dismissal, there can be no doubt that they prescribe a standard which is applicable to employee disciplinary investigations.[34] They are apt for an investigation which under the Bank’s Fair Workplace Policy is required to be procedurally and substantively fair, and fairly conducted. Finally, it is worthwhile noting that not every procedural irregularity gives rise to unfairness.[35]
[34] Similar findings have been made in cases concerning termination of employment claiming breach of an alleged implied contractual term of mutual trust and confidence – see:
a)Morton v Transport Appeal Board (No 1) (2007) 168 IR 403 at 430 per Berman AJ; [2007] NSWSC 1454 at para.162 per Berman AJ (“Morton”): “… the employer could not be expected to carry out an investigation of a standard which might be carried out by the police”;
b)Russell v Trustees of the Roman Catholic Church, Archdiocese of Sydney (2008) 72 NSWLR 559 at 568 per Basten JA; [2008] NSWCA 217 at para.37 per Basten JA (“Russell”) where an employer’s investigator’s telephone interview with a witness was said to be a not unacceptable means of interviewing and assessing credibility; and
c)Rogers v Millenium Inorganic Chemicals Pty Ltd & Anor (2009) 229 FLR 198 at 224 per Lucev FM; [2009] FMCA 1 at para.127 per Lucev FM (“Rogers”): “There is no obligation upon an employer in an investigation of this kind to conduct a perfect investigation or an investigation the equivalent of a police investigation or to disclose the names of persons who might have witnessed relevant events.”
[35] Byrne v Australian Airlines Limited (1995) 185 CLR 410 at 430 per Brennan CJ, Dawson and Toohey JJ, at 466 per McHugh and Gummow JJ; Shire of Esperance v Mouritz (1991) 71 WAIG 891.
Mr Carroll says that he carried out the investigation over the period from 8 December 2006 to 20 February 2007. Mr Carroll says that he “conducted the investigation in the usual manner that investigations are conducted by the … [Bank] when employees make complaints. The investigation involved a number of meetings with the personnel involved over the period of the investigation.”[36] That evidence as to the usual method of investigation was not challenged. He says that the investigation was regarding the events alleged in statements provided by:
a)Ms Winnel;
b)Mr Gera;
c)Mr Finucane; and
d)Mr Ireland.[37]
[36] Mr Carroll’s First Affidavit, para.10; Mr Carroll’s Second Affidavit, para.4.
[37] Mr Carroll’s First Affidavit, para.9.
Mr Carroll had dealings with Ms Winnel:
a)at a meeting on 8 December 2006 at 5.00pm. At that meeting:
i)Mr Carroll observed that Ms Winnel appeared to be “in an emotionally fragile state … and she came across as nervous and scared”;[38]
[38] Mr Carroll’s Second Affidavit, para.16.
ii)Mr Carroll received from Ms Winnel a copy of her 8 December 2006 Statement, and discussed its contents;
iii)Mr Carroll saw bruising on Ms Winnel’s arm, which she said was “the result of a sexual assault by” Mr Gera, and which included:
·“a very dark bluish and yellow bruise on her left upper arm”;
·“bruising lines coming around her arm with a vertical bruise pointing upwards” and which Mr Carroll observed “looked like a right hand grab”;
·a “large bruise on the side of her left buttock”.[39]
[39] Mr Carroll’s Second Affidavit, para.17(2).
iv)Ms Winnel advised that she had attended the Royal North Shore Hospital Sexual Assault Service, and it had been recommended that she have two weeks off work;
v)Ms Winnel advised that she had been in contact with the New South Wales Police[40] and would be making a formal complaint to them, but that the NSW Police had advised her not to make further statements to the Bank;
[40] “NSW Police”.
vi)Ms Winnel advised that she had received calls from Mr Ireland and Mr Gera since 4 December 2006, including 12 calls from Mr Gera which she referred to as “harassing”, and that she did not want to speak to Mr Ireland as she knew Mr Ireland had a dinner meeting scheduled with Mr Gera on 4 December 2006.[41]
[41] Mr Carroll’s Second Affidavit, para.17.
b)in response to email and telephone calls from Mr Carroll, Ms Winnel sent a letter and statement to Mr Carroll on 13 December 2006.[42] In the 13 December 2006 Letter Ms Winnel advised Mr Carroll that she had been advised by the NSW Police that they would not provide reports to her until their investigation was completed. In the 13 December 2006 Statement Ms Winnel:
[42] Mr Carroll’s First Affidavit, para.8 and Annexure MSC 5 (“13 December 2006 Letter and 13 December 2006 Statement respectively”); Mr Carroll’s Second Affidavit, paras.23-25 and Annexure MSC 15.
i)noted that Mr Gera was “nominated to be my mentor at the … Bank. His role is State Sales Manager of Western Australia, a position superior to mine”;
ii)set out the programme for a series of meetings that she was to attend with Mr Gera on 4 December 2006 including client meetings at 11.00am[43] and 1.00pm,[44] and the Team Meeting at 3.00pm at the Bank’s offices in Sydney;
[43] “First Client Meeting”.
[44] “Second Client Meeting”.
iii)said that:
“Duane and I attended the first organised meeting … The second client meeting was organised with … in Croydon. Duane instructed ‘let’s cancel the meeting and have lunch instead.’ We had lunch in a restaurant in Blues Point Road North Sydney. During lunch Duane suggested ‘let’s order a bottle of wine.’ I replied ‘I cannot drink much as I am driving. I also have work I must finish back at the office this afternoon.’ Duane then proceeded to order glasses of wine for both of us.
Following lunch we drove back to the city. Due to the fact that we were still driving back to the office at 3pm (the commencement time of the Monthly Update Key Business Partners and Review), I suggested ‘shouldn’t we dial in to the internal meeting from the car?’ Duane replied ‘No, let’s wait to dial in from my hotel room.’ I replied, ‘I would like to return to work to attend the meeting at the office once we get back to the city.’ He again insisted ‘No, let’s dial in to the meeting from my hotel room, stating ‘it will look bad if you walk into the meeting late.’ I again replied ‘I would feel more comfortable attending the meeting from the office.’ Duane instructed ‘Let’s park the car here’ (being a carpark near his hotel). When parking my car, I advised the parking attendant ‘I will be about one hour’ (the duration of the internal meeting that we were dialling in to), with the intention of returning to the office. The car was parked at approximately 3.20pm.
Once we arrived in the hotel room, Duane poured us both a glass of white wine from the mini bar. He stated ‘I am meeting Paul Ireland for dinner tonight.’ Duane dialled in to the meeting on his mobile phone and placed the phone on loudspeaker and muted dialler voice reception. This occurred at approximately 3.25pm. We listened to the meeting while sitting at the dining table. He then proceeded to order a bottle of white wine to the room without consultation. Duane poured two glasses from the bottle. I asked ‘Do you mind if I use your bathroom?’ He replied ‘Sure, but make sure you close the shutter.’ I returned from the bathroom and sat at the dining table with Duane. Within a short time-frame of consuming part of the glass of wine poured, I suffered from a sudden onset of extreme lethargy and blurred vision. I stated ‘Something is happening, I don’t feel right.’ Duane suggested ‘why don’t you lie down on my bed.’ I estimate this occurred at approximately 4.30pm.
I have no clear recollection of events following that conversation and I have been advised I contacted my partner Scott Jackson at 7.20pm, in a distressed state seeking assistance. Duane was no longer in the room. My ability to communicate was limited and my mobility was impaired to the extent that I could not move from the bed or hold the phone to my ear for more than few minutes. This resulted in 13 phone calls with Scott in 68 minutes, the period from making the first call seeking assistance, until I was able to dress and leave the hotel and travel to Scott’s residence in Mosman by taxi. I recall having a great deal of difficulty moving and putting my shoes on. My suit jacket was left in the hotel room. I left the room prior to Duane Gera returning…”
iv)relates a number of calls that evening from Mr Gera, including one where, whilst her recollection is vague, she recalls him wanting her to return to the Hotel. She says she received eight calls from Mr Gera the next day (5 December 2006) and then switched her phone off. She also says that she received emails from Mr Gera requesting that he contact her;
v)says that she noted a number of “severe bruises” the following day (5 December 2006) and she attended the Royal North Shore Hospital Sexual Assault Service for a medical examination where she was advised by the physician and psychologist that “it was likely I had been the victim of an attempted rape after being drugged” and that “the bruises were consistent with a man’s hand, all of identical size”;
vi)says that she had since made a complaint to the NSW Police which was under criminal investigation.
c)at a meeting on 20 December 2006, at which Ms Winnel pointed out that:
i)Mr Gera had “admitted … that he had left her in an incapacitated state in the hotel room alone”; and
ii)that, in her view, “leaving her alone in this state was inappropriate conduct on which the … [Bank] could base a finding of misconduct”;
and otherwise made statements which are consistent with her earlier description of the events in the Hotel Room.[45]
[45] Mr Carroll’s Second Affidavit, para.32.
d)at a meeting on 17 January 2007, Ms Winnel:
i)advised Mr Carroll that she was awaiting a Doctor’s report from the Royal North Shore Hospital;
ii)advised Mr Carroll she was reluctant to comply with the NSW Police instruction not to discuss the events of 4 December 2006 with the Bank, and that she understood that the Bank needed information before it could make a decision;
iii)gave Mr Carroll a copy of a psychologist’s report[46] (which Mr Carroll determined, ultimately, not to take into account in the matter because he was not satisfied that it was anything more than a report repeating information given by Ms Winnel rather than being an objective inquiry into what happened on 4 December 2006);
iv)said that she could remember Mr Gera’s “body laying on top of her” and when she realised what was going on she “punched … [Mr Gera]” and that Mr Gera “then grabbed her arm, pushed her on her side and then she felt him pushing her skirt up”;
v)said that she recalls Mr Gera being in the Hotel Room looking for her mobile phone, it ringing twice, it being found in her bag by Mr Gera and being switched off by him;
vi)said that “she asked … [Mr Gera] for assistance but he ignored her”;
vii)told Mr Carroll that she only saw Mr Gera’s face when he was on top of her, and not his body;
viii)said that it was about the time that she went to the toilet in the Hotel Room, when the applicant told her not to forget to shut the shutters, that Ms Winnel noticed that she was having difficulty moving and felt lethargic; and
ix)said that her top had not been interfered with, and that it was “an intricate lace-up top” which she would not have been able to put on by herself.[47]
[46] “Psychologist’s Report”.
[47] Mr Carroll’s Second Affidavit, para.51.
Ms Winnel’s partner Mr Jackson was also present at the meetings between or involving Mr Carroll and Ms Winnel.
Mr Carroll met with Mr Gera, and his solicitor, Mr Havilah:
a)on 9 January 2007 in Perth, at which meeting:
i)Mr Carroll explained that the Bank was investigating the alleged incident;
ii)Mr Havilah asked if Mr Carroll was aware of the NSW Police investigation into the incident, and Mr Carroll advised that he considered that any NSW Police investigation was separate to the Bank’s investigation;
iii)Mr Carroll cautioned the applicant with words to the effect:
“I will be asking you certain questions that you are not obliged to answer, but answers that you do give may be taken down and used in evidence.”
Mr Gera confirmed that he understood the caution.
iv)they discussed Mr Gera’s view of Ms Winnel as an employee generally;
v)they discussed attendance at the First Client Meeting on 4 December 2006 and the cancellation of the Second Client Meeting scheduled for that day;
vi)they discussed the Lunch, in relation to which Mr Gera said that both he and Ms Winnel had ordered their own glasses of wine;
vii)Mr Gera said that he was not required to attend the Team Meeting, but that Ms Winnel as a member of the Sydney team ought to have attended the Team Meeting;
viii)Mr Gera said he “made a judgment call on advice from Ms Winnel” and decided to return to the Hotel so that they could dial into the meeting from his Hotel Room, and that he recalled Ms Winnel saying that she did not want to turn up late for the Team Meeting;
ix)Mr Gera said that when they returned to the Hotel Room he and Ms Winnel each had a glass of wine from the mini bar, at which point Mr Havilah interrupted and advised Mr Gera not to speak about that issue further;
x)Mr Gera said that he and Ms Winnel dialled into the meeting on Ms Winnel’s Blackberry, as they did not intend actively participating in the meeting unless spoken to directly, and that the phone was placed on mute;
xi)Mr Gera said that following the Team Meeting call Ms Winnel “hit on him” and leaned towards him, but that he “pushed himself away”, but when Mr Carroll pressed for more information Mr Gera said he had no further comment;
xii)Mr Gera said that he had received advice from Mr Ireland when he called him at approximately 6.00pm that he ought “…not to return to the hotel, to leave the room and stay away from the room…”
xiii)when asked why he returned to the Hotel Room, Mr Gera said that he stood by the second last paragraph on page 2 of his statement, which reads:
At this point I returned to my room to check on Elina and ensure she was okay. When I entered the room she was asleep but awoke straight away. I advised her that she was asleep in my room and that I was going out for dinner. I asked her if she wanted to get a cab home but she asked me to get her handbag and phone which I placed beside the bed and then left for dinner. There was nothing mentioned of the previous events at this point and I left with her still lying in the bed…;[48]
[48] Mr Gera’s First Affidavit, Annexure 6; “Mr Gera’s Statement”.
xiv)Mr Gera said he then went to dinner at a Japanese restaurant near the Chifley Hotel with Mr Ireland and other work colleagues;
xv)Mr Gera said that during the time he was at dinner Ms Winnel returned a call from him and said that she was at home and okay;
xvi)when asked about the number of phone calls that Ms Winnel alleged he had made to her phone since 4 December 2006, Mr Gera said that he had no comment in relation to that;
xvii)Mr Gera and Mr Havilah informed Mr Carroll that they had nothing else to say in relation to the allegations except that the allegations were untrue;
xviii)Mr Carroll provided Mr Havilah with a copy of the written information that Ms Winnel had provided to the Bank to that time, and suggested that there be a meeting the following day.[49]
[49] Mr Carroll’s Second Affidavit, paras.39-40.
b)on 10 January 2007, when:
i)Mr Havilah indicated that the allegations were “fairly serious and needed to be substantiated” and had been initially lodged three days after the alleged event. Insofar as the allegations complained that Mr Gera was “a predator”, had given Ms Winnel “some stupefying drug” and that Mr Gera had “attempted to rape her”, they were “not credible”, given that Mr Gera knew that he had a meeting with senior officers of the Bank that evening; and
ii)Mr Havilah requested earlier drafts of one of Ms Winnel’s letters, and noted that Ms Winnel’s call log attached to the 13 December 2006 Statement was not complete.[50]
[50] Mr Carroll’s Second Affidavit, para.41.
c)on 23 January 2007 at the Hyatt Hotel in Perth for the purpose of giving Mr Gera the opportunity to respond to issues and matters raised by Ms Winnel in the meeting that she had with Mr Carroll on 17 January 2007, and in earlier correspondence received from her, and at which meeting:
i)Mr Gera said that it was agreed that the Second Client Meeting on 4 December 2006 would be re-scheduled because the First Client Meeting had ended after the Second Client Meeting was due to commence;
ii)Mr Gera said that at the Lunch he and Ms Winnel had ordered their own meals and drinks, and that Ms Winnel had told him that she could not drink much as she was driving;
iii)Mr Gera did not see himself as being in a position of power over Ms Winnel by reason of his being her mentor;
iv)Mr Gera said that he “offered Winnel the option of dialling into the 3pm meeting from his room”, which offer had been accepted as Ms Winnel was “concerned about walking into the meeting late”;
v)Mr Gera said that Ms Winnel had taken the wine out of the mini bar in the Hotel Room;
vi)Mr Gera said that they had “both agreed to order a bottle of wine to the room” and when Ms Winnel “appeared to be inebriated” it was Mr Gera who suggested she lay down and sleep it off, after which he left the Hotel Room;
vii)Mr Gera denied turning off Ms Winnel’s mobile phone while she was in the Hotel Room;
viii)when questioned on why he did not seek immediate assistance when Ms Winnel appeared to be incapacitated and why he left her alone in that condition Mr Gera told Mr Carroll that he had already told Mr Carroll what he did and did not give any further answer;
ix)Mr Gera denied sexually assaulting Ms Winnel;
x)although Mr Carroll had further questions to ask Mr Gera, Mr Havilah advised Mr Gera not to say anymore and each subsequent question was answered with “No comment” and the interview ended.[51]
d)on 15 February 2007 at Council House in Perth, at which meeting Mr Gera and Mr Havilah offered no further response to the Bank’s letter of 2 February 2007, although they asked to speak with the Bank on a without prejudice basis, which the Bank (through Mr Carroll) was not prepared to do.[52]
[51] Mr Carroll’s Second Affidavit, para.55.
[52] Mr Carroll’s Second Affidavit, para.73.
Mr Carroll met with Mr Ireland on 12 January 2007, and Mr Ireland told Mr Carroll that:
a)he had selected Mr Gera to be Ms Winnel’s mentor;
b)on 4 December 2006 at approximately 6.00pm Mr Ireland received a call from Mr Gera who said that:
i)he had left the Hotel, but Mr Ireland said that he could hear a lot of background noise on the telephone;
ii)Ms Winnel had “hit on him”, but that Mr Ireland told Mr Carroll “that he did not think that would be true”, and had responded to Mr Gera with words to the effect of “you’re kidding” and that his initial reaction was to tell Mr Gera to leave the Hotel Room;
c)he met with Mr Gera when he arrived at the Hotel, that Mr Gera entered the Hotel lobby from outside, and from which they then went to dinner at a Japanese restaurant;
d)he did not believe that Mr Gera returned to his Hotel Room before they left the Hotel for the Japanese restaurant; and
e)Mr Gera told Mr Ireland that he called Ms Winnel at around 9.30pm at a time when he was away from the table for 5 to 10 minutes, but that Mr Ireland did not witness Mr Gera making the call.[53]
[53] Mr Carroll’s Second Affidavit, para.45.
Mr Carroll met Mr Finucane on 12 January 2007, and Mr Finucane said that:
a)he had attended the dinner at the Japanese restaurant on 4 December 2006 and that Mr Gera appeared relaxed and happy; and
b)Ms Winnel was “open when discussing her sexual appetite” and that Ms Winnel had told Mr Finucane “that she had a high sexual appetite” and that shortly after Ms Winnel had joined the Bank “he had gone out for drinks with her and that when she had her third drink it was like a switch and her demeanour changed.”[54]
[54] Mr Carroll’s Second Affidavit, para.47.
Mr Carroll also received advice from the Bank’s Chief Medical Advisor who had received a report from Dr Edwards of the Sexual Assault Service at the Royal North Shore Hospital in Sydney. Dr Edwards’ report had been compiled from clinical notes taken by Dr Lord on 5 December 2006 when Dr Lord saw Ms Winnel. The Chief Medical Officer is a senior position with the Bank.[55] Relevantly, on 31 January, 2007 the Chief Medical Officer wrote to Mr Carroll as follows:
“The report states that the injuries sustained … described in detail but excluded from this statement ‘are very suggestive of some form of manual gripping and sexual assault’ …
Dr Edwards could find no statement in the clinical or forensic notes to indicate the injuries … [were] made by a male person however in her experience it would be uncommon for a female to cause such injuries.
Dr Edwards concludes ‘I regret that Dr Lord was unavailable to provide this report and I ask you to take into account the limitations on my report that arrive (sic) from the fact that I did not examine Elina Winnel myself.”[56]
[55] Transcript 19 November 2008 at page 262.
[56] Mr Carroll’s First Affidavit, Annexure MSC 7, being a letter to Mr Carroll from Dr C S Johnston, Chief Medical Officer dated 31 January 2007 (“Dr Johnston’s Letter”).
Mr Carroll collated and reviewed the information he had gathered during the investigation. This occurred around the beginning of February.[57]
[57] Mr Carroll’s Second Affidavit, para.59.
Mr Carroll noted that much of the evidence provided by Mr Gera and Ms Winnel was common, namely:
a)that Mr Gera was to assist Ms Winnel as her mentor;
b)that they had attended the First Client Meeting on the morning of 4 December 2006;
c)the Second Client Meeting for that day had been cancelled;
d)Mr Gera and Ms Winnel went to Lunch together;
e)during Lunch they consumed wine;
f)at around 3.20pm they returned to the Hotel Room where they dialled into the Team Meeting;
g)during the course of the Team Meeting they each consumed wine from the mini bar in the Hotel Room; and
h)that following the Team Meeting a bottle of wine was ordered to be brought up to the room, and they drank wine while discussing business.[58]
[58] Mr Carroll’s Second Affidavit, para.60.
Mr Carroll also observed that there were significant differences between the accounts of Mr Gera and Ms Winnel as to what occurred after 4.30pm on 4 December 2006. He noted those differences as follows:
“The Applicant had given the following versions of events:
(1)At around 5.10pm he received a call from Finucane who was trying to get in touch with Winnel. He said he relayed a message from Winnel to Finucane that Winnel did not want to speak to him as it was after 5pm but that she would call him the following day.
(2)At 5.40pm Winnel appeared to be very inebriated and made sexual advances towards him. He said he had had rejected these advances and suggested she take a taxi home. Due to Winnel’s inebriated state it was not possible to get her downstairs to the taxi. He said that at around 6 pm he suggested she lay down to “sleep it off”.
(3)He then left the hotel room and Winnel in an incapacitated state and telephoned Ireland to tell him what had happened. He then went for a walk “to clear his head”. He returned to his hotel room at around 7pm to check Winnel was okay.
(4)On his return Winnel woke up. He told her that he was going to dinner with Ireland and asked if she wanted a taxi but she said she wanted her hand bag and phone. He placed these beside the bed and then left to have dinner.
Winnel had given the following version of events:
(1)At around 4.30pm she used the bathroom in the Applicant’s hotel room. Around that time that she suffered the onset of lethargy and blurred vision.
(2)As she was feeling unwell, she lay on the bed in the hotel room at the Applicant’s suggestion. She felt a body on top of her and when she realised the Applicant was trying to sexually assault her she tried to defend herself and asked the Applicant to stop but the Applicant continued with his actions.
(3)Her next recollection was the Applicant searching for her mobile phone. He called her phone twice at 6.20pm and 6.21pm and when he located it in her handbag, removed it and switched it off. The time of the phone calls was corroborated by Winnel’s mobile phone records.
Annexed hereto and marked ‘MSC 34’ is a copy of the Winnel’s and the Applicant’s mobile phone records.
(4)She told the Applicant she needed help and asked for a doctor but the Applicant ignored her requests and left the room.
(5)She later made her own way home and was on the phone to Jackson for the duration of the journey home.”[59]
[59] Mr Carroll’s Second Affidavit, paras.61-62.
Mr Carroll also reviewed the summary of the medical evidence provided by Dr Johnston, the Bank’s Chief Medical Officer. Mr Carroll formed the opinion that “the medical evidence supported the allegation of sexual assault.”[60] Mr Carroll observed that Ms Winnel was “during the course of the investigations … severely affected by some event that had occurred on 4 December 2006.”[61] Mr Carroll said that:
“The factor that convinced me of Winnel’s version was the medical information as it confirmed a sexual assault. On the balance of probabilities this satisfied me that Winnel’s allegations against the Applicant were substantiated and that the Applicant was the person who sexually assaulted Ms Winnel.”[62]
[60] Mr Carroll’s Second Affidavit, para.63.
[61] Mr Carroll’s Second Affidavit, para.64.
[62] Mr Carroll’s Second Affidavit, para.64.
Mr Carroll concluded on the balance of probabilities that Mr Gera had “engaged in serious misconduct”.[63]
[63] Mr Carroll’s Second Affidavit, para.65.
On 2 February 2007 Mr Carroll wrote and sent a letter to Mr Gera, the terms of which were as follows:
“Workplace Incident – 4 December 2005
As you are aware, the Bank has been investigating an allegation made against you by Ms Elina Winnel. As part of our investigations we have:
· received statements produced by Ms Winnel, Mr Paul Ireland and yourself (you have been provided with all statements provided by Ms Winnel); and
· conducted interviews with Ms Winnel and yourself; and [sic]
In addition, Ms Winnel has provided the Bank’s Chief Medical Officer, Dr Col Johnston, with a medical report produced by a doctor from the Royal North Shore Sexual Assault Service, Dr Jean Edwards. Ms Winnel attended the Sexual Assault Service on 5 December 2006. Relevantly, Dr Johnston has noted that:
“The report states that the injuries sustained (described in detail) “are very suggestive of some form of manual gripping and sexual assault”.
We have given careful consideration to all of the material made available to us, and to your responses to the allegations made by Ms Winnel. Based upon the information provided and evidence available to the Bank, it has determined that on the balance of probabilities you have breached the Bank’s Statement of Professional Practice and your employment contract, and engaged in serious misconduct. Specifically, the Bank has determined that you:
· Sexually/indecently assaulted Ms Winnel in your room at the Radisson Hotel, Sydney on Monday, 4 December 2006; and
· following that assault failed to provide Ms Winnel with any assistance or support and left her unattended in your hotel room.
On the basis of the above, the Bank is considering terminating your employment. Prior to making its decision, you are provided with an opportunity to submit any further written representations or provide any further material you may have as to why we should not terminate your services for serious misconduct. Any further information you have in this regard should be provided by no later than 5.00 pm Tuesday, 7 February 2007. Alternatively, please contact Mick Carroll on … [telephone number deleted] by no later than 10.00 am Monday 6 February 2007 should you wish to meet to put any further information to us in person.”[64]
[64] Mr Carroll’s Second Affidavit, Annexure MSC 35; “2 February 2007 Letter”.
Mr Gera’s solicitors responded to the 2 February 2007 Letter on 6 February 2007 requesting various materials and documents and additional time to respond to the 2 February 2007 Letter. Also, there was a request for a further meeting with Mr Carroll.[65]
[65] Mr Carroll’s Second Affidavit, para.68 and Annexure MSC 36; “6 February 2007 Letter”.
Mr Carroll responded to the 6 February 2007 Letter on 8 February 2007.[66] In relation to various documents requested by Mr Gera’s solicitors:
[66] Mr Carroll’s Second Affidavit, para.70 and Annexure MSC 37.
a)Mr Carroll advised that the Bank was not in possession of any medical report from Dr Edwards or notes, memoranda or records made by Dr Edwards of the Royal North Shore Sexual Assault Service, in relation to this matter. Mr Carroll further advised that:
“The Bank’s Chief Medical Officer, Dr Johnston, has been provided a letter from Dr Jean Edwards of the Royal North Shore Sexual Assault Service. Dr Johnston has not released this letter to other persons within the Bank, but has extracted from that letter or described those parts which are relevant to the Bank’s investigations. No other person within the Bank is aware of the contents of the balance of that correspondence. Further, Dr Johnston is not involved in any decision making process with respect to this matter.”
b)the following documents were provided:
i)a copy of a medical certificate issued by Dr Lord on 5 December 2006 certifying Ms Winnel was unfit for work from 5 to 15 December 2006;
ii)Dr Johnston’s report, relevant portions of which had already been extracted and provided to Mr Gera;
iii)statements from Mr Ireland and Mr Finucane, as well as all notes of all meetings conducted with Mr Gera, Ms Winnel, Mr Ireland and Mr Finucane in relation to interviews as part of the Bank’s investigation into the allegations;
iv)Mr Gera’s telephone records as well as records of calls made between Mr Gera and Ms Winnel from Ms Winnel’s phone records; and
v)a copy of the Bank’s Statement of Professional Practice, Termination of Employment and Fair Treatment Review policies; and
c)a meeting was confirmed for 13 February 2007 with Mr Gera in Perth, which meeting was later changed to 15 February 2007. Details of that meeting are set out above.
The Psychologist’s Report was not provided, and Mr Gera’s solicitors were advised that the Bank was not taking it into account in considering Ms Winnel’s allegations.
Following the meeting of 15 February 2007 Mr Carroll returned to Sydney and reviewed all of the documents, including a letter dated 15 February 2007 from Mr Gera’s solicitors setting out additional points that Mr Gera wanted the Bank to take into account.[67] On the basis of that review Mr Carroll concluded that:
a)Mr Gera and his solicitor had offered no relevant additional information; and
b)the allegations concerning Mr Gera’s conduct on 4 December 2006 were proven on the balance of probabilities,
and therefore the conduct amounted to serious misconduct which Mr Carroll considered warranted the summary termination of Mr Gera’s employment.[68]
[67] Mr Carroll’s Second Affidavit, paras.72 and 74.
[68] Mr Carroll’s Second Affidavit, paras.74 and 75.
Mr Carroll prepared a report for Mr De Luca.[69] Mr Carroll’s Report, provided to Mr De Luca on 20 February 2007, set out the allegations and summarised the information that Mr Carroll had obtained during the investigation, and in accordance with the Bank’s usual practise, made a recommendation based on the evidence obtained during the investigation. That recommendation was that Mr Gera’s employment with the Bank be terminated for serious misconduct.[70]
[69] Mr Carroll’s First Affidavit, Annexure MSC 6 (“Mr Carroll’s Report”).
[70] Mr Carroll’s Second Affidavit, paras.76-77.
Mr Carroll’s Report largely summarised the information which has been set out above and which was gathered during the course of the investigation. It was specifically noted that a criminal investigation was being undertaken by NSW Police and that “both parties have been reserved in providing the Bank with relevant information following advice that each had received from their respective legal advisors.” It is also noted that no forensic material was available to the Bank to assist it in identifying who perpetrated the assault on Ms Winnel. In response to the view expressed in a letter from Mr Gera’s solicitors dated 15 February 2007 that “… there is insufficient evidence before the bank to lead it to conclude, on any reasonable analysis, that our client has committed any serious misconduct warranting summary termination.” Mr Carroll observed that:
“That view is based on the statements of each of the individual’s solely and does not pay any heed to the advice provided to us by our CMO, Dr Colin Johnston. Dr Johnston was provided with a report from Dr Edwards of the Royal North Shore Sexual Assault Service attended by Ms Winnel.”
Mr Carroll’s report summarises the accounts given to the investigation, noting that Ms Winnel attended the Royal North Shore Hospital Sexual Assault Service on 5 December 2006 and then reported the incident to both the Bank and the NSW Police on 8 December 2006, and observes that the information provided by each of Mr Gera and Ms Winnel concerning events subsequent to 4.30pm varies significantly. Mr Carroll then proceeds as follows:
“What sets Ms Winnel’s version of events apart is the information provided by the RNSH Sexual Assault Service stating:-
The report states that the injuries sustained (described in detail) ‘are very suggestive of some form of manual gripping and sexual assault’.
The information and evidence made available to the Bank brings us to the conclusion that Mr Gera, on the balance of probabilities, sexually/indecently assaulted Ms Winnel in his room at the Radisson Hotel in Sydney NSW. This view is supported by our legal advisers.
There is nothing of any substance in Mr Gera’s reply that detracts from that opinion and it is recommended that approval be given to terminate the services of Mr Gera.”
Mr Carroll met with Mr De Luca on 23 February 2007. Mr De Luca informed Mr Carroll that he had reviewed Mr Carroll’s Report and the supporting documentation. Following the asking of some questions regarding the investigation, Mr De Luca informed Mr Carroll that he agreed with the recommendation and requested that a letter be drafted to Mr Gera advising of the outcome of the investigation and that the Bank was terminating his employment with immediate effect.[71]
[71] Mr Carroll’s Second Affidavit, paras.78-79.
The Termination Letter was prepared by Mr Carroll and signed by Mr De Luca. Mr Carroll then met with Mr Burnett and together they rang Mr Gera and relayed the information contained in the Termination Letter to Mr Gera.[72]
[72] Mr Carroll’s Second Affidavit, paras.79-80.
When what was done by Mr Carroll is analysed it is evident that:
a)he interviewed relevant persons involved, sometimes more than once;
b)he took or was provided with written statements and documents which he subsequently collated and considered;
c)he has given Mr Gera an opportunity to respond to the Bank’s allegations (including meeting Mr Gera on four occasions), which opportunity Mr Gera has taken (including taking the right not to answer certain questions);
d)he has considered Mr Gera’s responses;
e)he has considered all materials (including Mr Gera’s responses) in preparing Mr Carroll’s Report;
f)he included in Mr Carroll’s Report a recommendation, for termination without pay in lieu of notice, which recommendation was discussed and approved by senior management; and
g)he conveyed the outcome to Mr Gera.
Mr Carroll has, in the Court’s view, investigated the allegations.
Fair Workplace Policy
In relation to the conduct of the investigation the Fair Workplace Policy does not require:
a)the investigation be carried out by:
i)a particular kind of person;
ii)a person with particular qualifications; or
iii)a combination of the foregoing;
b)a particular procedure be followed; or
c)particular written documentation to be provided.[73]
[73] Contrast McAleer v University of Western Australia (2007) 159 IR 96; [2007] FCA 52 (“McAleer”) where a certified agreement expressly provided for the employer to notify employees of the “precise nature” of the allegations concerned which were under investigation: McAleer IR at 99 per Siopis J; FCA at para.13 per Siopis J.
The Fair Workplace Policy deals with procedural fairness not only in a general way in relation to which the matter has been handled, but sets out certain principles which must be applied. These are dealt with below.
The first principle is that the decision-maker must act without bias or prejudging the issue. Mr Gera alleges that Mr Carroll was biased, seemingly on the basis that Mr Carroll was a senior Bank employee.[74]
[74] Applicant’s Outline of Submissions, para.482; Transcript 21 November 2008 at page 309.
Bias connotes a predisposition towards or prejudice against one party’s case or evidence for reasons unconnected with the merits.[75]
[75] Flaherty v National Greyhound Racing Club Ltd [2005] EWCA Civ 1117 at para.28 per Lord Justice Scott Baker.
To prove actual bias on the part of the decision-maker, or here the investigator, requires evidence of a state of mind such that the decision-maker or the investigator is so committed to a conclusion already formed as to be incapable of alteration, whatever evidence or arguments may be presented.[76] The test for apprehended bias is whether a fair-minded lay observer might reasonably apprehend that the decision-maker or the investigator might not bring an impartial mind to the resolution of the question to be decided.[77]
[76] Minister for Immigration and Multicultural Affairs v Jia Legeng (2001) 205 CLR 507 at 532 per Gleeson CJ and Gummow J; [2001] HCA 17 at para.72 per Gleeson CJ and Gummow J.
[77] Re Refugee Tribunal; Ex parte H (2001) 179 ALR 425 at 434 per Gleeson CJ; Gaudron and Gummow JJ; [2001] HCA 28 at para.27 per Gleeson CJ, Gaudron and Gummow JJ; and in relation to administrative proceedings: ALR at 434-435 per Gleeson CJ, Gaudron and Gummow JJ; HCA at para.28 per Gleeson CJ, Gaudron and Gummow JJ.
In this case there is no evidence of bias of any kind. Mr Carroll has carried out his tasks in a neutral, measured manner. Mr Carroll has met with witnesses (including Mr Gera and Ms Winnel) as and when required, and has given Mr Gera an opportunity to respond to allegations, which Mr Gera did, utilising, in addition, the services of his solicitors. Those solicitors were present at various meetings held between Mr Carroll and Mr Gera. Mr Carroll made it clear to Ms Winnel on 15 January 2007 that the “sole focus of the Bank’s investigation is to ascertain whether there has been conduct which, from the point of view of the employer, should be acted upon” and pointed out that “in the interests of fairness, it is necessary to give both parties the opportunity to respond to all allegations made” and therefore Mr Gera had been provided with “full details of your allegations, to the extent that they are relevant to the Bank’s investigation”.[78] This is not the language or conduct of a biased investigator.
[78] Mr Carroll’s Second Affidavit, Annexure MSC 28 (email from Mr Carroll to Ms Winnel, 15 January 2007).
Mr Carroll also refused to have regard to the Psychologist’s Report, on the basis that it was arguably a record of what Ms Winnel had told the psychologist, rather than the psychologist’s own conclusions. Had Mr Carroll been acting in a biased manner he might have relied upon the Psychologist Report, or at least those parts which were consistent with observations made by Mr Carroll himself in relation to Ms Winnel’s presentation, namely those parts of the Psychologist’s Report relating to Ms Winnel’s presentation to the psychologist on 9 December 2006:
a)in “an anxious, agitated and emotional state”; and
b)as showing “severe bruising in the shape of a hand on her hip and other parts of her body”.[79]
The fact that Mr Carroll did not take the Psychologist Report into account is further evidence that he was not biased, because if Mr Carroll was pre-disposed to an outcome he might easily have had regard to the Psychologist’s Report, or at least parts of it.
[79] Mr Carroll’s Second Affidavit, Annexure MSC 30.
Apart from the fact that Mr Carroll was himself a Bank employee, there is no evidence or factor in this case which points to Mr Carroll’s Report and the recommendation within it, or the evidence gathering process, as being tainted by bias. The fact that Mr Carroll is a Bank employee does not of itself, without more, indicate bias. The mere fact that Mr Carroll was a senior employee within the Bank is not sufficient to allow the Court to arrive at a conclusion that there was some form of apprehended bias as a consequence of his employment. If this were the case no employee of any employer would be able to carry out an investigation in relation to an employee’s alleged misconduct, and employers would have to have external investigators for all disciplinary complaints requiring investigation. The law would not regard that as necessary, unless it could be shown that all of an employer’s employees qualified to carry out the investigation were biased.
The Fair Workplace Policy provides for each party to present their own case (starting with the initiator) and allowing each party to fully respond to all allegations made. The outline provided above indicates that both Ms Winnel and Mr Gera were given the opportunity to put their respective cases, and put them fully. Mr Gera was also allowed the opportunity to fully respond to all allegations made, and to the extent indicated above, did so.
The Fair Workplace Policy also required that:
a)all relevant considerations be taken into account;
b)the decision-maker disregard irrelevant matters;
c)individuals be informed about decisions affecting them; and
d)the recommendation meets certain criteria as to the severity and frequency of the offence, the weight of the evidence, the wishes of the team member who raised the issue and consistency with certain of the Bank’s key principles.
In determining whether relevant considerations have not been taken into account or irrelevant matters have been considered it needs to be borne in mind that the decision-maker only fails on this account if it fails to consider a relevant consideration or considers an irrelevant matter where it is something that is bound to be taken into account in making the decision. Where, as here, relevant factors are not expressly stated (save for certain reference to the Bank’s policies) they must be determined by implication from the subject matter, scope and purpose of, in this case, the AWA, and to any necessary extent the contract of employment. Insignificant matters may not materially affect the decision and therefore failure to take them into account may not warrant the Court reaching a view that the Bank could not have been satisfied, as required here, because it did not take those matters into account. Finally, the question of satisfaction is one for the Bank, and it is only if the evidence discloses that the Bank could not have reached the relevant state of satisfaction that the Court ought to conclude that the necessary preconditions existed for there to be a breach of contract by the Bank, because it could not have been so satisfied.[80]
[80] Although not directly applicable because this was not an administrative decision, principles outlined in Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24, especially at 39-42 per Mason J, can be adapted to that part of the matter which goes to fulfilment of the criteria related to the Bank’s achieving a state of being satisfied.
For reasons which appear, both above and below, the Court is not satisfied that the Bank failed to take into account any relevant considerations, nor did it allow irrelevant matters to influence its considerations.
In regard to information about decisions affecting him, Mr Gera was informed, not only concerning the ultimate outcome, but of each substantive step as it was taken toward that ultimate outcome;
There is nothing in the evidence to indicate that the recommendation made in Mr Carroll’s Report did not meet any of the relevant criteria.
Whether the investigation was substantively fair, as required by the Fair Workplace Policy, depends on whether there was material such as to enable the Bank to determine that it was “satisfied” that Mr Gera’s “actions or behaviour constitute misconduct”,[81] in which case the Bank was entitled to dismiss with payment in lieu of notice; or “serious misconduct”, in which case the Bank was entitled to dismiss with pay up to the date of termination.
[81] AWA, cl.16.3.
Conclusion re investigation
In all the circumstances, the Court finds that:
a)Mr Carroll was qualified to carry out the investigation;
b)there was a proper investigation, properly conducted; and
c)the investigation complied with the Bank’s Fair Workplace Policy so far as procedural fairness is concerned. Whether it complied with the Fair Workplace Policy with respect to substantive fairness depends upon the answer to the issue of satisfaction, which is discussed immediately below.
Satisfaction
The question arises as to what standard of satisfaction is necessary for the Bank in making a determination as to whether or not there has been misconduct. It is relevant to note that:
a)the AWA; and
b)the WR Act,
do not specify a standard of satisfaction. A standard of satisfaction is not specified by reason of the fact that the required investigation is one which, for reasons set out above, is not required to be a judicial or police style examination of the issues. An employer must be reasonably satisfied that the conduct occurred, and that the conduct constituted misconduct (or serious misconduct as the case may be), having regard to the information obtained during the investigation, the nature of the case, and the particular facts in issue, including their inherent gravity or unlikelihood. Concepts relevant to standard of proof in a civil proceeding in a federal court are not appropriate concepts for use in the determination of the Bank’s satisfaction in a disciplinary investigation.[82]
[82] See, for example, Duhbihur v Transport Appeal Board (2005) 149 IR 126; [2005] NSWSC 811 where the so-called “Briginshaw standard” was applied to the decision of the Board on appeal from the employer’s decision to dismiss: IR at 136 per Hall J; NSWSC at para.66 per Hall J, but the Court observed that the employer’s decision was to be made on a broad test of reasonableness: IR at 145-146 per Hall J; NSWSC at para.117 per Hall J.
When the evidence is analysed it is apparent that there was evidence capable of satisfying the Bank that Ms Winnel had been sexually or indecently assaulted. Relevant to the allegation of sexual or indecent assault is the fact that the day after the alleged sexual or indecent assault Ms Winnel had severe bruising on her hand, arms and buttocks.[83] Ms Winnel was examined the day after the incident at the Royal North Shore Hospital Sexual Assault Service, her injuries were recorded, and said to be consistent with a sexual assault. At a subsequent meeting involving Mr Carroll (and others) the bruises were seen, and recorded, by Mr Carroll, and Ms Winnel alleged that she had been sexually assaulted by Mr Gera.[84]
[83] Transcript 19 November 2008 at page 258-259; and Mr Carroll’s Second Affidavit, para.17 and Annexure MSC 11.
[84] Mr Carroll’s Second Affidavit, paras.13 and 17.
Relevant to the question of whether or not there was a sexual or indecent assault by Mr Gera are the undisputed facts that both Mr Gera and Ms Winnel had been drinking:
a)at lunch; and
b)for at least two hours in the Hotel Room,
and that Ms Winnel was, on a best case scenario for Mr Gera, affected by that drinking to the point of inebriation and un-coordination.
Ms Winnel gave details to the investigator of what she had remembered, including being assaulted by Mr Gera on the bed, and the fact that Mr Gera did not endeavour to undo an intricately tied lace top that she had on, but rather pushed up her skirt.
There was also evidence on which the Bank could rely which indicated that Ms Winnel was in an emotionally fragile state, nervous and scared. She appeared to be so at the meeting with the Bank on 8 December 2006.[85]
[85] Mr Carroll’s Second Affidavit, para.16.
The medical evidence available to the Bank indicated that the injuries sustained by Ms Winnel were “…very suggestive of some form of manual gripping and sexual assault”.[86]
[86] Mr Carroll’s First Affidavit, Annexure MSC 7.
Mr Gera criticises Ms Winnel’s version of events on the basis that she allegedly gave inconsistent accounts over a period of time following her initially raising the matter with the Bank on 8 December 2006. Reliance is placed on the fact that on 13 December 2006 Ms Winnel indicated that she had no clear recollection of the events in the Hotel Room on 4 December 2006. And, further, that additional detail not contained in earlier statements was added at a later time. However, the Bank was entitled to look at the fundamentals of the evidence available to it, which indicated that on a medical examination on 5 December 2006 Ms Winnel appeared to have been sexually assaulted by a male. She then made that specific allegation on 8 December 2006 to the Bank. Her later recall of further detail is not inconsistent with those original allegations. Furthermore, they are not, strictly speaking, inconsistent with statements to the effect that she had no clear recollection of events. She obviously had some recollection of events and it is that recollection of events which in the days following the incident she has related to her medical examiners, to the Bank, and in particular to Mr Carroll as the Bank’s investigator. It is not unusual for witnesses to recall an incident, or additional detail of an incident, at later points in time. For example, Mr Gera only recalled some relevant detail during the hearing, revealing for the first time that he in fact fell on top of Ms Winnel at some point in the Hotel Room.[87] On 6 December 2006 Mr Gera had made a statement containing no reference to that fact.[88]
[87] Transcript 17 November 2008 at page 31.
[88] Mr Gera’s Statement.
Mr Gera suggests that Ms Winnel’s prior conduct (seemingly, as observed by Mr Finucane on one occasion), is relevant as suggesting that Ms Winnel was incontinent, and that that was a consideration that was relevant to whether or not the Bank could be satisfied that Mr Gera had assaulted Ms Winnel. Mr Carroll was obviously aware of the comment by Mr Finucane, but appears to have given it little weight. He was, also seemingly aware of Mr Ireland’s view, on the evening concerned, that he (Mr Ireland) did not believe Mr Gera when he said that Ms Winnel had “hit on him”. Even if Ms Winnel was incontinent, any lack of sexual self-restraint on her part is irrelevant because Mr Gera categorically denies having sexually assaulted her, and there is no allegation or admission of consensual sexual relations. In the circumstances, the Bank was left with the two conflicting personal accounts, and the medical evidence which supported Ms Winnel’s account. Further, incontinence on the part of Ms Winnel, and whether or not it was exhibited on 4 December 2006, does not assist Mr Gera with the second aspect of the alleged misconduct, namely, that he left her incompetent in the Hotel Room. That allegation is made out on his own evidence.
Mr Gera criticised the Bank’s alleged failure to release, and have regard to, Dr Edwards’ report, rather than Dr Johnston’s summary. However, because Dr Johnston’s summary of the gist of the relevant matters was accurate, nothing practically turns on the alleged failure, because it makes no difference to the relevant information which was then before the Bank.
Mr Gera suggested that the Court should draw a Jones v Dunkel[89] inference against the Bank’s case on satisfaction because Ms Winnel was not called to give evidence. However, Ms Winnel’s evidence was not necessary. This is because what was in issue was whether the AWA terms had been breached, that is whether the Bank was able to be satisfied on the basis of an investigation that the alleged misconduct had occurred. That depended on whether at the time the decision to terminate was made the Bank was “satisfied”, and whether the information available to the Bank at that time was capable of satisfying the Bank as to the occurrence of the alleged misconduct by Mr Gera.
[89] (1959) 101 CLR 298.
This Court is deciding whether the conditions existed for the Bank to act in reliance on the contractual terms, which depend upon what the Bank was then capable of being satisfied about. This Court is not, and cannot, review the discretion inherent in the Bank determining whether it was satisfied, unless the material before the Bank at that time, that is the time the decision to terminate was made, was not capable of satisfying the Bank as to the misconduct alleged to have occurred.
For reasons set out above, the information available to the Bank at that time was capable of satisfying the Bank that the alleged misconduct had occurred. Therefore Jones v Dunkel has no application in this case, and no inference adverse to the Bank’s case will be drawn from the fact that Ms Winnel was not called to give evidence in these proceedings.
It was also suggested by Mr Gera that the delay by Ms Winnel in making the allegation, and it was said in obtaining treatment, ought to have been taken into account by the Bank when determining whether it could be satisfied as to whether the allegation of misconduct had been made out. But the question has to be asked: “What delay?”. Ms Winnel alleges she was assaulted on the afternoon or evening of 4 December 2006. When she sufficiently recovered to move from the Hotel Room she went to her partner’s house. She then went to the Royal North Shore Hospital Sexual Assault Service the following day, 5 December 2006, and was medically examined. Ms Winnel was sufficiently unwell at that time to be given a certificate excusing her from attendance at work until and including 15 December 2006, indicating a fairly significant trauma or injury. She complained in writing to the Bank on 8 December 2006. Given that she had a sick leave certificate excusing her from attendance at work Ms Winnel might, if she had wanted to, have relied upon that certificate to delay making a complaint until after 15 December 2006. In circumstances where Ms Winnel was medically examined the day following the alleged assault by Mr Gera, and injuries consistent with a sexual assault were found upon examination, and a sick leave certificate for ten days was issued, a delay of four days in making a complaint to the Bank was minimal, and of no account (or no significant account) in the Bank’s determination of whether or not it was satisfied that the alleged assault had occurred.
Throughout the investigation Mr Gera denied having assaulted Ms Winnel in any way, or having caused her injuries or bruising.[90] Mr Gera’s solicitors’ final representations to the Bank were that there was insufficient evidence on any reasonable analysis for the Bank to come to the view that Mr Gera had committed any serious misconduct warranting summary termination.[91] Having regard to the nature of the investigation and the nature of satisfaction which the Bank was required to achieve in order to arrive at a conclusion that Mr Gera had misconducted himself by sexually or indecently assaulting Ms Winnel, the Bank acknowledged that the accounts of each of Mr Gera and Ms Winnel differed as to what occurred in the Hotel Room after 4.30pm on 4 December 2006. Ultimately, the Bank placed significant reliance upon the report of the medical examination which indicated that Ms Winnel had sustained injuries which were “very suggestive” of a “manual gripping and sexual assault”.
[90] Affidavit of Ian Keith Burnett, sworn 24 September 2008 (“Mr Burnett’s First Affidavit”), Annexure IKB 5, Letter from Mr Gera’s solicitors to Mr Carroll dated 15 February 2007; Transcript 17 November 2008 at page 68 and 19 November 2008 at page 258.
[91] Mr Gera’s solicitors’ letter of 15 February 2007 [insert affidavit]; Mr Carroll’s Report at Annexure MSC 6 in Mr Carroll’s First Affidavit.
Mr Gera argued that it was a denial of procedural fairness for the investigation to continue whilst a criminal investigation remained alive, or a live possibility. In appropriate circumstances, an injunction may be obtained to stay civil proceedings, but that remedy is discretionary, and there is, generally speaking, no inhibition upon an employer dismissing an employee in relation to conduct which is also the subject of incomplete criminal proceedings.[92] There was therefore nothing to prevent the Bank from continuing with its investigation, up to and including the termination of Mr Gera’s employment, whilst the matter remained in the hands of the NSW Police.[93]
[92] Cameron’s Unit Services Pty Ltd v Kevin R Whelpton & Associates (Australia) Pty Ltd (1984) 4 FCR 428; Baker & Anor v Commissioner of Federal Police (2000) 104 FCR 359 at 364 and 365 per Gyles J; [2000] FCA 1339 at paras.27 and 30 per Gyles J (and cases there cited) (“Baker”).
[93] Baker FCR at 365-366 per Gyles J; FCA at para.30 per Gyles J. See also Schouten v Telstra Corporation Ltd (1993) 49 IR 399 at 402-403 per Wilcox J; Goreng v Jennaway (2007) 164 FCR 567 at 571-572 per Flick J; [2007] FCA 2083 at paras.22-26 per Flick J. The cases cited by Mr Gera in support of the proposition that it was a denial of procedural fairness are not binding on this Court. The decisions cited by the Court above, being decisions of the Federal Court, are binding.
Mr Gera also suggested that the Bank had not specified the actions or behaviours which constituted the misconduct, and that there was a denial of procedure fairness insofar as they were not specified. It is difficult to understand this contention, unless what is being contended for is that there must be the most minute step-by-step setting out of the actions and behaviours said to constitute the misconduct. Having regard for the nature of the investigation required to be conducted by an employer in these circumstances that cannot be the case. In any event, it is the Court’s view that the actions and behaviours are sufficiently set out in the Bank’s allegations that there was serious misconduct by reason of the alleged assault and the leaving of Ms Winnel unattended and incontinent in the Hotel Room. Those are actions which constitute a form of conduct, which conduct the Bank says in this case constitute serious misconduct.
The Bank had proper regard to all of the available evidence, and the responses from Mr Gera as to what ought to be made of that evidence, as well as all of Ms Winnel’s evidence (save for the Psychologist’s Report) and the medical evidence. Even allowing for the gravity of the allegation which was made, in this case there was sufficient evidence for the Bank, relying in particular as it did upon the medical evidence, and what could be inferred from the medical evidence, to arrive at the conclusion that it was reasonably satisfied on the balance of probabilities that Ms Winnel had been sexually or indecently assaulted by Mr Gera.
An analysis of the evidence which was before the Bank at the time the decision to terminate was made also reveals that there was sufficient evidence for the Bank to be satisfied that Mr Gera had left Ms Winnel in the Hotel Room in an incontinent state, and had failed to provide assistance or support.
The evidence before the Bank was that:
a)Mr Gera had been appointed to mentor Ms Winnel, that is, to be an experienced and trusted counsellor to her;[94]
[94] Concise Oxford Dictionary, page 633.
b)Ms Winnel was a probationary employee of the Bank;
c)both Mr Gera and Ms Winnel had been drinking, and:
i)had two glasses of wine during lunch;
ii)Ms Winnel drank wine whilst she and Mr Gera were on the phone to the Team Meeting;
iii)Mr Gera drank wine and a beer up to the end of the Team Meeting; and
iv)they consumed a full bottle of normal size wine ordered from room service after the Team Meeting was finished;[95]
d)Ms Winnel subsequently became uncoordinated, disoriented and unable to maintain her balance, and her state was such that Mr Gera did not get her a taxi because she could not stand; and
e)Mr Gera left Ms Winnel in the Hotel Room without obtaining any further assistance for her, or making any calls or inquiries as to what further assistance he might or could obtain for her, and, in circumstances where – on a best case scenario for Mr Gera – Ms Winnel did not know where her mobile phone was.
[95] Transcript 17 November 2008 at pages 28-30.
Mr Gera sought to rely on the fact that at some time around 6.00pm he spoke to Mr Ireland, and told him that Ms Winnel had “hit on him”, and she was drunk and “sleeping it off”, and that as a consequence, Mr Ireland told him to “leave the room”. That response is strange because on Mr Gera’s account he had already left the room, and would later return to the room, albeit briefly. But Mr Gera’s reliance on Mr Ireland’s “instruction” is misplaced because:
a)Mr Gera had, on his account, already left the Hotel Room (and therefore the allegation of leaving Ms Winnel in the Hotel Room was made out); and
b)Mr Gera did not tell Mr Ireland the extent of Ms Winnel’s incontinence, and in particular that she was uncoordinated, disoriented and unable to stand;[96] and
c)excluding the alleged assault, did not disclose the entire background to how Ms Winnel came to be uncoordinated, disoriented and unable to stand, namely the afternoon of drinking at Lunch and in the Hotel Room, with her mentor.[97]
[96] Transcript 18 November 2008 at page 5.
[97] Transcript 18 November 2008 at page 5.
There can be little doubt, even on Mr Gera’s own evidence to the Bank (and largely repeated at the hearing) that he did leave Ms Winnel in the Hotel Room in an utterly incompetent state.[98] Therefore, the Bank was able to be satisfied that Ms Winnel had been left alone without assistance or support, in the Hotel Room, in an incompetent state.
[98] Transcript 17 November 2008 at page 33; Mr Gera’s First Affidavit, paras.195-218.
Was it misconduct or serious misconduct?
In this case Mr Gera’s termination of employment was because of serious misconduct found by the Bank to have occurred on 4 December 2006. It was the serious misconduct which justified summary termination of employment without pay in lieu of notice. Misconduct alone might have justified termination of employment, but with payment in lieu of any required notice.
The use of the adjective “serious” imposes an additional requirement before the Bank can terminate employment without notice. Something more than mere misconduct is required. Whilst it has been said that there is “no fixed rule of law defining the degree of misconduct which would justify dismissal”[99] it has traditionally been accepted that what is required is that the conduct complained of is such as to show the employee to have disregarded the essential conditions of the contract of service.[100] A single act can justify a dismissal, especially where it is destructive of mutual trust between employer and employee.[101]
[99] Clouston and Co v Corry [1906] AC 122 at 129 per Lord James of Hereford.
[100] Laws v London Chronicle (Indicator Newspapers) Ltd [1959] 1 WLR 698 at 701 per Lord Evershed MR; North v Television Corp Ltd (1976) 11 ALR 599 at 609 per Smithers and Evert JJ (“North”).
[101] North at 609 per Smithers and Evert JJ; Concut Pty Ltd v Worrell (2001) 75 ALJR 312 at 321-323 per Kirby J; [2000] HCA 64 at para.51 per Kirby J.
There can be no doubt that the sexual or indecent assault of a fellow employee is serious misconduct warranting summary termination without payment in lieu of notice. It is such a fundamental breach of an employee’s duty, particularly in circumstances where the employee is a senior employee and mentor to the employee who has been assaulted. Based on the circumstances in this case the Bank, once it was satisfied that the assault had occurred, was justified in summarily terminating Mr Gera’s employment.
The question of whether it is serious misconduct to leave a fellow employee incontinent in a Hotel Room is perhaps more difficult. However, in the circumstances of this case, where Mr Gera was:
a)a senior management employee;
b)Ms Winnel’s mentor,
and Ms Winnel was a probationary employee with whom he had been drinking since the Lunch, there can be no doubt that it was serious misconduct to leave her in the Hotel Room in an incontinent state. As was suggested by the cross-examination of Mr Gera, the Bank, which was her employer, and which he represented, owed Ms Winnel a duty of care. Mr Gera was required to exercise that duty of care as the Bank’s representative, to ensure that she came to no harm or injury in circumstances where as a consequence of her incompetent state she was manifestly vulnerable. For those reasons, the Court has no doubt that Mr Gera seriously misconducted himself when he left Ms Winnel alone in an incompetent state in the Hotel Room, and that that serious misconduct stands independently of the alleged sexual assault as a basis for the termination of his employment without pay in lieu of notice. Even if the Court is wrong in that view, the Court is of the view that it must be misconduct which would then have warranted termination with payment in lieu of notice, which in this case was four weeks.
Substantive fairness
Having regard to the Court’s view that the Bank was entitled to be satisfied that Mr Gera had seriously misconducted himself, for the reasons set out above, Mr Gera was afforded substantive fairness in terms of the recommendation made in Mr Carroll’s Report.
Conclusion re breach of term of AWA
In the above circumstances, there was no breach of either clause 15 or clause 16 of the AWA. The Bank conducted a proper investigation and there was sufficient evidence arising from the Bank’s investigation for the Bank to be satisfied that Mr Gera had seriously misconducted himself in a manner warranting termination of employment without payment in lieu of notice.
It was also faintly suggested by Mr Gera that the investigation was procedurally unfair, or breached the AWA, because it was not timely. In the circumstances, given the nature of the incident, the time of the year, and the extent of the investigation undertaken by Mr Carroll, as well as the additional time requested, for example, on 6 February 2007 by Mr Gera, the Court does not consider that the investigation was conducted other than in a timely and efficient manner, or at least in a sufficiently timely and efficient manner so as not to constitute a breach of the AWA.
Mr Gera suggested that the Bank’s suspension of him during the period of the investigation was in breach of the AWA. Whilst the suspension of an employee might give rise to some interesting questions in certain circumstances, in this case, Mr Gera acquiesced in the suspension and no question of breach of the contract therefore arises.
Implied term of mutual trust and confidence or duty of good faith
Mr Gera argued that the contract of employment was subject to a term implied by law as to good faith and mutual trust and confidence. The Bank argued that the implied term was not recognised in Australian law.
In Rogers this Court, having extensively reviewed the relevant authorities concerning an alleged implied term of mutual trust and confidence in a contract of employment,[102] concluded that:
119.Having regard to the fact that the existence of the Implied Term of Mutual Trust and Confidence has been recognised, not only in the most senior court of the United Kingdom, but also by Australian superior courts including the former Full Court of the Industrial Relations Court, the Federal Court, and various State Supreme Courts and by at least one member of the New South Wales Court of Appeal (with the other two members assuming its existence), this Court considers that it must recognise the Implied Term of Mutual Trust and Confidence is part of Australian law in relation to contracts of employment and should be implied into contracts of employment, unless expressly excluded by the parties.
120.The Implied Term of Mutual Trust and Confidence applies to events leading up to the decision to terminate employment, but not the decision to terminate itself, or its implementation.[103]
[102] Rogers FLR at 218-222 per Lucev FM; FMCA at paras.104-118 per Lucev FM.
[103] Rogers FLR at 222 per Lucev FM; FMCA at para.119-120 per Lucev FM.
Mr Gera conceded that this aspect of the claim was essentially an alternative to the claim for breach of the terms of the AWA. The alleged breach of the implied term was put in very broad terms as being evidenced by a lack of fairness generally, and failure to comply with the Bank’s policies and procedures and a denial of substantive and procedural fairness generally.
For reasons set out in detail in relation to the alleged breach of clauses 15 and 16 of the AWA there was no breach of substantive or procedural fairness in the circumstances of this case. Further, an implied term of mutual trust and confidence cannot import into the contract of employment broad (and arguably vague) notions of procedural fairness not otherwise recognised by the common law.[104]
[104] Morton IR at 431 per Birman AJ; NSWSC at paras.163-164 per Birman AJ.
The claim for breach of an implied term of good faith and mutual trust and confidence therefore fails.
Interference with contractual relations
The tort of interference with contract is committed when a respondent intentionally interferes with the performance by a third party[105] of a contract between that third party and an applicant.[106]
[105] Williams v Hursey (1959) 103 CLR 30. Greig v Insole [1978] 3 All ER 449.
[106] RP Balkin and JLR Davis, Law of Torts (3rd Edn) (2004, LexisNexis Butterworths, NSW) at para.21.2 (“Law of Torts”).
The essential element of the tort is the respondent’s intention to bring about a breach of the contract;[107] it is irrelevant that there was no malice in the sense of spite or ill-will;[108] conversely, good faith is no defence.[109]
[107] Hospitality Group Pty Ltd v Australian Rugby Union Ltd (2001) 110 FCR 157 at 188 per Hill and Finkelstein JJ; [2001] FCA 1040 at para.127 per Hill and Finkelstein JJ. As to what the plaintiff must plead and prove to demonstrate the requisite intention, see Allstate Life Insurance Co v ANZ Banking Group Ltd (1995) 58 FCR 26 at 42-45 per Lindgren J. Law of Torts at para.21.3.
[108] Thomson (DC) & Co Ltd v Deakin [1952] Ch 646 at 676 per Evershed MR (“Thomson”): see Law of Torts at para.21.3.
[109] Greig v Insole [1978] 3 All ER 449 (“Greig”): see Law of Torts at para.21.3.
If a respondent does an act the substantially certain consequence of which is directly to bring about a breach of a contract of which the respondent is aware, then it will be presumed that the breach was intended, and liability will ensue unless the presumption is rebutted.[110] An indirect interference with a contract, however, must be a necessary consequence of the respondent’s acts.[111]
[110] White v Riley [1921] Ch 1; and see Woolley v Dunford (1972) 3 SASR 243 (“Woolley”): see Law of Torts at para.21.3.
[111] Law of Torts, para.21.3.
Any valid and enforceable contract can found an action upon subsequent interference with it:[112] meagre evidence of its terms is enough.[113]
[112] Thomson at 677 per Evershed MR: see Law of Torts at para.21.4.
[113] Daily Mirror Newspapers Ltd v Gardner [1968] 2 QB 762: see Law of Torts at para.21.4.
It is accepted that the tort is committed by inducing a contracting party not to fulfil some of the contractual obligations even though, by reason of the terms thereof, that failure to perform does not render that party liable to the applicant in damages.[114] There is a tort even though the interference does not cause a failure by the other contracting party to perform, which would have been actionable by the applicant. For the commission of the tort:
…there must be interference in the execution of a contract. The interference is not confined to the procurement of a breach of contract. It extends to a case where a third person prevents or hinders one party from performing his contract, even though it be not a breach.[115]
This proposition has been accepted in Australia as a correct statement of the law,[116] and expressly affirmed by the House of Lords.[117]
[114] Law of Torts, para.21.5.
[115] Torquay Hotel Co Ltd v Cousins [1969] 2 Ch 106 per Lord Denning MR at 138; similar views were expressed obiter by Winn LJ at 147.
[116] Woolley at 267 per Wells J.
[117] Merkur Island Shipping Corp v Laughton [1983] 2 AC 570 at 608 per Lord Diplock.
The respondent must be shown to have had some knowledge of the contract which has been broken.[118] The relevant question is ‘whether the defendant had sufficient knowledge of the contract to know that he was hindering or preventing its performance’.[119]
[118] Long v Smithson (1918) 118 LT 678: Law of Torts at 21.8.
[119] Woolley at 270 per Wells J.
Interference with a contract may be direct or indirect. Direct interference may be brought about by words (persuasion or procurement) or by deeds (disabling the person with whom the applicant has contracted from continuing with performance of the contract). Indirect interference is, in general, occasioned by the respondent’s procurement of others to bring about the disablement of the plaintiff’s contract.[120]
[120] Law of Torts, para.21.9.
It must be proved that the breach of the contract has caused damage, or at least that damage can be inferred from the circumstances.[121]
[121] Exchange Telegraph Co v Gregory & Co [1896] 1 QB 147 (CA); Greig at 490 per Slade J (it is enough for the applicant to show ‘the likelihood of more than nominal damage resulting’ from the respondent’s acts): Law of Torts, para.21.23.
In essence, Mr Gera complains that by reason of a direction given to the Bank’s employees not to deal personally with him, there has been an interference in contractual relations between Mr Gera and his current employer, Southshore Finance, with whom he commenced as a finance broker in March 2007, and their clients. He was initially an employee on a fixed salary plus commission, and from 1 July 2008 became a commission-only independent contractor to Southshore Finance.
There is no evidence that the Bank intended to bring about a breach of any contract, either of employment or that of principal and independent contractor, between Southshore Finance and Mr Gera. The Bank is entitled to determine with whom it will deal, particularly where it takes the view that it is necessary to do so as part of its duty of care toward its own employees. On the evidence, the Bank’s intention was to protect its own position, not to interfere with any contract between Mr Gera and Southshore Finance. Further, it is not apparent what contractual obligations Mr Gera has not been able to fulfil towards Southshore Finance, or to what extent he has actually been prevented or hindered from performing his contractual obligations. There was little or no evidence as to the precise content of Mr Gera’s contractual obligations in that regard. Indeed, the mere fact that Southshore Finance was considering making him a partner in the business, indicates that if there has been any hindrance, its effect has not been significant.
Finally, it must be proved that the breach of the contract, or the hindrance in performance of the contract, has caused damage or that damage can be inferred from the circumstances. On the evidence of Mr Gera’s actual earnings it is difficult to see what damage has been caused to Mr Gera in relation to the alleged interference with contractual relations. The evidence simply lacks the specificity necessary to draw any safe conclusions about the quantum of damage caused even if there has been interference with contractual relations of the type alleged. Bare assertions by Mr Coombes as to what Mr Gera’s earning potential might be do not assist the Court to determine what his actual loss and damage are, even if there has been interference in contractual relations as alleged by Mr Gera.
In all the circumstances, the Court is simply not satisfied that there is any, or any sufficient, evidence which justifies a finding that there has been interference with contractual relations as alleged, or that any damage was suffered or has been proven by Mr Gera.
Conclusion and order
Mr Gera has failed to establish that the Bank:
a)breached the AWA;
b)breached a duty of mutual trust and confidence or good faith; or
c)interfered with contractual relations between Mr Gera, and his new employer or the employer’s clients.
The application will therefore be dismissed. There will be an order accordingly.
The Court will hear the parties as to costs, if any.[122]
[122] WR Act, s.824.
I certify that the preceding one hundred and thirty (130) paragraphs are a true copy of the reasons for judgment of Lucev FM
Associate: Sandra Gough
Date: 30 March 2010
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