Hawkesbury Race Club Limited v Leggett
[2018] NSWWCCPD 24
•6 June 2018
| DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR | ||
| CITATION: | Hawkesbury Race Club Limited v Leggett [2018] NSWWCCPD 24 | |
| APPELLANT: | Hawkesbury Race Club Limited | |
| RESPONDENT: | Vivienne Maree Leggett | |
| INSURER: | Racing NSW | |
| FILE NUMBER: | A1–5047/17 | |
| ARBITRATOR: | Mr G Capel | |
| DATE OF ARBITRATOR’S DECISION: | 7 December 2017 | |
| DATE OF APPEAL DECISION: | 6 June 2018 | |
| SUBJECT MATTER OF DECISION: | Whether failure to admit new evidence would cause substantial injustice; CHEP Australia Limited v Strickland [2013] NSWCA 351; 12 DDCR 501 applied; psychological injury; whether “real events” occurred; consideration of “reasonable action” pursuant to s 11A of the Workers Compensation Act 1987 | |
| PRESIDENTIAL MEMBER: | Deputy President Elizabeth Wood | |
| HEARING: | On the papers | |
| REPRESENTATION: | Appellant: | Leigh Virtue & Associates |
| Respondent: | Statewide Compensation Lawyers | |
| ORDERS MADE ON APPEAL: | 1. The application to admit new evidence is refused. 2. The Certificate of Determination dated 7 December 2017 is confirmed. | |
INTRODUCTION
Vivienne Maree Leggett was employed by the Hawkesbury Race Club Limited (Hawkesbury) as a sponsorship and marketing manager. She ceased work on 9 October 2016, alleging she had been bullied and harassed by the Chief Executive Officer, Mr Gregory Rudolph. She alleged psychological injury as a consequence of such conduct.
Ms Leggett completed a claim form for compensation on 17 February 2017, claiming weekly benefits and medical expenses with a deemed date of injury of 10 October 2016.
Hawkesbury initially denied the claim in a notice dated 20 March 2017 which was issued pursuant to s 74 of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act).[1] It denied that Ms Leggett was injured and that her employment was a substantial contributing factor to the injury, relying on ss 4 and 9A of the Workers Compensation Act1987 (the 1987 Act). It disputed any injury was compensable because of the operation of s 11A of the 1987 Act. It further disputed that Ms Leggett had been the subject of bullying in the workplace and disputed that any incapacity for work was compensable. The basis of the defence raised pursuant to s 11A was that:
(a) Ms Leggett was proceeding with an action against Hawkesbury pertaining to an alleged breach of her employment contract;
(b) there had been negotiations relating to redundancy which had broken down (which pre-dated the compensation claim), and
(c) on the evidence available, there was no support for a claim that the employer had acted unreasonably toward her.
[1] Application to Resolve a Dispute (ARD), pp 125–127.
A second s 74 notice was issued on 23 May 2017, in which the denial was maintained. Hawkesbury relied on the same sections of the 1987 Act, but identified the defence pursuant to s 11A to be that the cause of any injury was “reasonable action taken or proposed by or on behalf of the employer in respect of discipline.” It relied on the opinion of Dr Glen Smith, psychiatrist, and factual information obtained in March 2017.[2]
[2] Reply to Application to Resolve a Dispute (Reply), pp 13–15.
A further s 74 notice was issued on 9 August 2017, maintaining the same issues in dispute including the defence pursuant to s 11A.[3]
[3] Reply, pp 16–18.
The dispute came to arbitration on 21 November 2017. The Senior Arbitrator issued a Certificate of Determination (COD) on 7 December 2017, entering an award in favour of Ms Leggett.
BACKGROUND
Ms Leggett commenced her employment with Hawkesbury in 1991. Apart from an interpersonal issue with a co-worker in April 2016, Ms Leggett had no employment issues until the appointment of a new Chief Executive Officer, Mr Rudolph, on 5 May 2016.
Ms Leggett alleged Mr Rudolph bullied her by the manner in which he spoke to her, by the tone of his emails to her, usurping her role in attracting sponsors, demanding information and by making negative remarks about her position to her and to others.
This conduct was said to have culminated in an incident on 9 October 2016. Ms Leggett alleged Mr Rudolph had previously given permission for her to attend the starting barriers. She did so for the last race on 9 October 2016, but Mr Rudolph rang her and told her to return to her duties. Ms Leggett sent an email to Mr Rudolph later that evening, complaining about his treatment of her in that incident and previously. Early on the morning of 10 October 2016, Mr Rudolph sent a short email advising that she was to attend a meeting that morning with him and with the payroll officer to “discuss her performance.” He advised she could bring a support person.
Ms Leggett did not attend the meeting. On that day, she attended her general practitioner, Dr Minh Tran, who provided her with a medical certificate and prescribed medication.
Ms Leggett did not return to work with Hawkesbury.
Hawkesbury alleged that Ms Leggett’s psychological decompensation was wholly or predominantly triggered by the incident on 9 October 2016, when she was told to go back to her duties, and the request for her to attend the meeting on 10 October 2016. Hawkesbury said that this was reasonable action taken by it with respect to discipline.
ON THE PAPERS
Hawkesbury submits that the Appeal Against Decision of an Arbitrator (Appeal) cannot be determined on the papers. It submits that a formal hearing is required in order for it to have the opportunity to properly articulate its grounds of appeal and submissions, given the serious and significant adverse findings made against it and Mr Rudolph.
Ms Leggett maintains that the matter can be determined on the papers.
A decision as to whether a matter ought to be determined on the papers of course requires a consideration of all of the evidence and submissions. Consideration also has to be given as to whether the parties have been afforded procedural fairness by having the opportunity to address any issue arising from such evidence.
In accordance with Practice Direction No 1, the factors that I am required to consider include whether an oral hearing has been requested, whether the parties have addressed on all issues and the complexity of the legal and/or factual issues.
Practice Direction No 1 provides:
“It is the responsibility of the parties to ensure that the Presidential member is properly and comprehensively informed in writing of the grounds of and issues on appeal, and that any objection to a determination on the papers is clearly stated and supported by specific and cogent reasons.”
The Appeal does not raise any new legal issues and the legal and factual issues are not complex. Hawkesbury’s reason for seeking an oral hearing is limited to the submission at [13] above.
Hawkesbury has had the opportunity to make written submissions. It has also taken the opportunity to make supplementary submissions in its amended appeal application and in reply to Ms Leggett’s submissions.
Section 354(6) of the 1998 Act provides:
“(6) If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”
I am satisfied that Hawkesbury has had ample opportunity to properly articulate its submissions. I am further satisfied that the parties have had the opportunity to address all issues on appeal and no new issue has arisen.
Having regard to Practice Directions Nos 1 and 6; the documents that are before me, and the submissions by the parties on this Appeal, I am satisfied that I have sufficient information to proceed ‘on the papers’ without holding any conference or formal hearing. I am satisfied that this is the appropriate course in the circumstances.
THRESHOLD MATTERS
There is no dispute between the parties that the threshold requirements as to quantum and time pursuant to subss 352(3) and 352(4) of the 1998 Act have been met.
NEW EVIDENCE
Hawkesbury seeks leave to rely on fresh evidence and additional evidence in the form of statements from Mr Peter Cooper dated 23 January 2018, Mr John Gollan dated 31 October 2017 and a further statement from Ms Lea Porteous dated 3 January 2018.
Hawkesbury submits that a failure to grant leave to adduce this evidence will cause a substantial injustice because it would be procedurally unfair. The procedural fairness is said to be occasioned by the Senior Arbitrator’s reasons at [21], [127], [129] and [130]. In those paragraphs, the Senior Arbitrator referred to allegations made by Ms Leggett about the statements expressed to her by Mr Gollan and Ms Porteous. The Senior Arbitrator noted that the evidence was not contradicted by Hawkesbury.
It should be noted that Hawkesbury submits that the Application to Resolve a Dispute (ARD) was served on Racing NSW, but it was not served at any stage prior to the arbitration on Hawkesbury, in breach of r 10.2 of the Workers Compensation Commission Rules 2011 (the 2011 Rules). Hawkesbury submits that as a consequence, it has not had the opportunity to adduce all evidence relevant to the defence of the claim. It is not clear as to whether this submission relates to the application to adduce further evidence, the application for an oral hearing or in respect of an allegation of denial of procedural fairness in the substantive Appeal. For the reasons set out at [44], it is apparent any such failure has not resulted in any unfairness to Hawkesbury.
Hawkesbury further contends that the matter proceeded rapidly to arbitration, so that it was not able to properly prepare its case.
Hawkesbury submits that the statement of Mr Gollan is “new evidence” and was not obtained before the Appeal was lodged, and was not available at the time the Appeal was lodged.
Hawkesbury relies on Transfield Services (Aust) Pty Ltd v Wicks(No 2)[4] and contends that in the circumstances of this case, it is just to admit the evidence.
[4] [2012] NSWWCCPD 77 (Wicks), [78].
Ms Leggett submits that none of the statements satisfy the test laid down in CHEP Australia Ltd v Strickland.[5]
[5] [2013] NSWCA 351; 12 DDCR 501 (Strickland).
Further, Ms Leggett says that Hawkesbury was legally represented at the telephone conference on 10 November 2016 and made no objection to the matter being listed for arbitration on 21 November 2016. Nor did it indicate it was intending to seek further evidence to meet the claim. She says the time frame from lodgment of the ARD and the arbitration was not unusual in terms of matters filed in the Commission. In addition, Hawkesbury elected to proceed without complaint at the arbitration.
Ms Leggett contends that Hawkesbury was alive to the allegation made by Ms Leggett that she complained to Mr Gollan. She refers to the response written by Mr Gollan in February 2017 to her claim in the Fair Work Commission, in which Mr Gollan referred to the allegation.
Ms Leggett submits that Mr Gollan’s statement was obtained after the ARD was served and was in response to [71] of Ms Leggett’s statement. It was obtained before the arbitration and Hawkesbury made no attempt to have it admitted, which suggested that a forensic decision was made not to rely on that evidence.
Ms Leggett further submits that the document page and paragraph numbering suggests the statement is incomplete or only part of other evidence.
Ms Leggett submits that Mr Gollan’s statement in response to Ms Leggett’s evidence was obtained before the telephone conference on 10 November 2017. The further statement by Ms Porteous could have been obtained in the same time frame.
In any event, Ms Leggett submits that the further statement of Ms Porteous, if admitted, would not change the outcome because the Senior Arbitrator’s decision did not rise or fall on the acceptance that Ms Porteous made the comments attributed to her by Ms Leggett.
Ms Leggett submits there would be strong public policy reasons to exclude the statement of Mr Cooper because it is a “protected confidence” within the meaning of s 126A of the Evidence Act 1995. If Mr Cooper is not bound by an obligation to maintain confidentiality, there is no reason why Mr Cooper could not have provided a statement before the matter proceeded to arbitration. There is no evidence of any steps taken to obtain the statement at an earlier stage.
In the alternative, Ms Leggett submits that Hawkesbury was aware of Mr Cooper’s involvement in negotiations because of the correspondence passing between Ms Leggett and Mr Rudolph.
Ms Leggett submits that the substance of Mr Cooper’s statement flies in the face of the contemporaneous evidence. Ms Leggett had complained about Mr Rudolph’s behaviour, had consulted her general practitioner and told Mr Rudolph about her symptoms which caused her to take sick leave. This all occurred while she was having dealings with Mr Cooper.
Ms Leggett says that the fact that she may not have mentioned these matters to Mr Cooper is not evidence that they did not occur and so the statement would not change the outcome.
Consideration
Section 352(6) of the 1998 Act provides:
“Evidence that is fresh evidence or evidence in addition to or in substitution for the evidence received in relation to the decision appealed against may not be given on an Appeal to the Commission except with the leave of the Commission. The Commission is not to grant leave unless satisfied that the evidence concerned was not available to the party, and could not reasonably have been obtained by the party, before the proceedings concerned or that failure to grant leave would cause substantial injustice in the case.”
Mr Gollan’s statement pre-dates the telephone conference and the arbitration. It was in existence, and it, therefore, was available to Hawkesbury to adduce into evidence at the arbitration. Clearly the document does not satisfy the first limb of s 352(6).
Mr Cooper’s statement and the supplementary statement of Ms Porteous were not in existence before the matter proceeded to arbitration. However, s 352(6) also requires that the evidence could not reasonably have been obtained by the party before the matter proceeded to arbitration. Hawkesbury does not submit that these statements were sought but unable to be obtained before the arbitration. If that was the case, then it would have been open to Hawkesbury to raise the difficulty with the Senior Arbitrator before the matter proceeded to be determined. Hawkesbury has offered no explanation as to why it waited until after the arbitration concluded and the Senior Arbitrator issued the COD before it sought these two statements.
It cannot be said that Hawkesbury did not know the case it had to meet. The ARD was filed on 6 October 2017. Hawkesbury arranged for legal representation and a Reply was filed on behalf of Hawkesbury on 27 October 2017.[6] With due diligence, Hawkesbury could have obtained and relied on all three statements before the arbitration commenced. Clearly, the statements of Mr Cooper and Ms Porteous do not satisfy the first limb of s 352(6).
[6] Hawkesbury’s additional submissions p 7 [9].
If the first limb of s 352(6) is not satisfied, then I am required to determine whether a failure to admit the documents would cause substantial injustice. In Strickland, Barrett JA discussed the test to be applied in consideration of whether a failure to admit documents would cause a substantial injustice. At [30]–[31] of his decision, his Honour said:
“Counsel for the appellant submitted that the Commission misdirected itself in law in construing the ‘substantial injustice’ criterion in s 352(6). It was submitted that that criterion may be satisfied in circumstances where it is not possible to say that availability of new evidence would have produced a different result; and that the criterion will be satisfied if the evidence is compelling and might have influenced the outcome even though it cannot be said that it would certainly have done so.
That construction cannot be accepted. The part of s 352(6) concerning ‘substantial injustice’ does not direct attention to possibilities or potential outcomes. The task is to decide whether absence of the evidence ‘would cause’ substantial injustice in the case. There must therefore be a decision as to the result that ‘would’ emerge if the evidence were taken into account and the result that ‘would’ emerge if it were not. If the result would be the same on each hypothesis, the ends of justice cannot be said to have been defeated by exclusion.”
Put simply, the second limb of s 352(6) requires an assessment of whether the Senior Arbitrator would have come to a different conclusion had that evidence been before him. In order to make that assessment, it is necessary to consider the new evidence and determine whether, had it been available to the Senior Arbitrator, it would have produced a different result.
Mr Cooper’s statement
Mr Cooper’s statement was obtained after the Senior Arbitrator handed down his decision. Mr Cooper assisted Ms Leggett in industrial proceedings against Hawkesbury in late 2016. He stated that Ms Leggett did not mention to him her psychological issues or complain to him that Mr Rudolph had bullied her. He further stated that the industrial proceedings related to a payment dispute and did not make any allegation of bullying.
Ms Leggett submits that the statement is inadmissible because it is a “protected confidence” within the meaning of s 126A of the Evidence Act 1995. Of course, the rules of evidence do not apply in the Commission, although the propriety of obtaining evidence from a person who formerly represented Ms Leggett and who would undoubtedly have been engaged with her in conversations of a confidential nature is questionable. In any event, if the document was admitted, the probative value would have to be assessed against the evidence, namely:
(a) the email dated 20 July 2016, described at [79(c)] below in which Ms Leggett referred to losing sleep and continually thinking about emails;
(b) the email on 9 October 2016 (also discussed below at [87]) in which she described the effect of the incident on 9 October 2016 as compounding other situations when she “felt down trodden, excluded and questioned unreasonably” as she carried out her duties;
(c) the clinical notes of her general practitioner, Dr Minh Tran. The notes disclose that Ms Leggett first attended on 10 October 2016 and complained of psychological symptoms in the context of interpersonal conflict with Mr Rudolph, and allegations of bullying and harassment. Ms Leggett continued to consult her general practitioner throughout the time Mr Cooper was assisting her and she was diagnosed with a psychiatric condition;
(d) medical evidence obtained in early to mid 2017 from her treating psychologist, Dr Gordana Jovanova, and Dr Glen Smith, psychiatrist (on behalf of Hawkesbury), confirming a psychological condition resulting from her employment, and
(e) medical opinion from her medicolegal expert, Dr Brian Parsonage, psychiatrist, in July 2017 confirming a work caused psychiatric condition.
Presumably the statement was sought to be relied on to dispute injury and potentially to dispute that Ms Leggett was bullied and harassed. It is confined to his recall of matters disclosed to him by Ms Leggett. In the light of the competing evidence, the statement has little probative value. It is not fresh evidence and it could not be said that the evidence is so compelling that it would lead the Senior Arbitrator to arrive at a different conclusion. It falls short of satisfying either limb of s 352(6) of the 1998 Act and is therefore not admitted.
Mr Gollan’s statement
Mr Gollan’s statement was obtained, and could have been relied on as evidence before the Arbitrator.
In the statement, Mr Gollan confirmed that he was one of the directors of Hawkesbury and that on 9 October 2016 Ms Leggett had a conversation with him. He recalls that Ms Leggett advised him she had organised with Mr Rudolph that she could attend the barriers. He stated she asked him to attend to the winners of the last race for her, to which he thought he may have agreed. He further stated that he attended the winners bar after the last race and that Ms Leggett was in attendance. She advised him that Mr Rudolph had told her “I got a phone call from Greg telling me I had to do my job.” Mr Gollan remarked that he had the impression Ms Leggett was not happy.
Mr Gollan stated that later that afternoon he saw Ms Leggett and her husband in the car park, when both complained about Mr Rudolph’s action that day. Mr Gollan said he could not recall in detail exactly what each person said. He stated that he replied “Look if you’ve got a problem, he’s your boss, he’s the CEO, you best go down and see him face to face and [sort] it out. Really, [it’s] got nothing to do with the directors.” Mr Gollan said that he did not consider they were making a formal complaint to him. He stated that he had no conversation with Ms Leggett about her bullying or being bullied. She has never said anything about those matters.
Mr Gollan’s only alleged involvement in this matter was that she spoke to him in the car park and complained to him about the phone call from Mr Rudolph. Ms Leggett alleged Mr Gollan responded, saying Mr Gollan told her “I wouldn’t have answered the phone. I’d tell him to [expletive]”.
Mr Gollan conceded he did not have a clear recollection of her conversation. He does not state that his response was limited to the response reported by him and he does not deny that he responded as alleged by Ms Leggett. In any event, his evidence does confirm that Ms Leggett received the phone call, was unhappy about it and complained that day to Mr Gollan.
The statement does not displace the evidence before the Senior Arbitrator and takes the matter no further.
The document is not likely to change the outcome and is not admitted.
It is relevant to note here that Mr Gollan’s statement, filed with the amended Appeal, was incomplete. Ms Leggett denies having been served with the complete document (which was annexed to the original Appeal). The complete statement was annexed to Hawkesbury’s submissions in reply, after Ms Leggett made her submissions. Ms Leggett has not sought to make further submissions beyond those made in her submissions in opposition to the Appeal.
I have determined the document ought not to be admitted. In those circumstances and in the interests of an efficient disposition of the Appeal, I consider that there is no procedural unfairness to Ms Leggett for me to proceed to determination of the admissibility of the document without further submissions from her.
The further statement of Ms Porteous
The copy of Ms Porteous’s statement in the amended Appeal is also incomplete. As with the statement of Mr Gollan, the complete statement was annexed to the original Appeal, which was filed with the Commission but apparently not served on Ms Leggett. Ms Leggett has made submissions on the incomplete statement and appeared to be unaware that the second page of the statement was missing.
Nonetheless, I am satisfied that I can determine whether the further statement of Ms Porteous ought to be admitted in the absence of complete submissions from Ms Leggett.
In her supplementary statement, Ms Porteous denied the allegation by Ms Leggett that she asked Ms Leggett why Mr Rudolph was “singling” Ms Leggett out and treating her unfairly. The allegation made by Ms Leggett is recorded at [85] below. Ms Porteous maintained that Mr Rudolph spoke in an authoritative voice, but said he never raised his voice, yelled or abused Ms Leggett.
Ms Porteous stated that she was in the office full time and Mr Rudolph’s office was ten steps from her desk. She said that Ms Leggett worked mostly from home, but when she came into the office, Ms Porteous would be able to hear any conversation Ms Leggett had with Mr Rudolph. Ms Porteous contended that she never heard Mr Rudolph yell, bully or intimidate Ms Leggett. She stated further that Ms Leggett had a “robust personality” and Ms Leggett and Mr Rudolph had “frank, direct conversations but nothing that amounted to unreasonable behaviour or bullying from either of them.”[7]
[7] Ms Porteous’ supplementary statement dated 3 January 2018, [6(a)].
Ms Porteous stated that she was within a metre of Mr Rudolph when he spoke to Ms Leggett about returning from the barrier on 9 October 2016. On that occasion, Mr Rudolph used Ms Porteous’ phone. Ms Porteous said that she could not recall Ms Leggett asking anyone if she could go to the barriers. She was present in most face to face conversations between Mr Rudolph and Ms Leggett and she would have been within a few metres of Mr Rudolph for the majority of times he spoke to Ms Leggett on the telephone. At those times, Mr Rudolph never raised his voice or spoke unreasonably. Ms Porteous stated that it was more likely that Ms Leggett would raise her voice because of her “very robust personality”, that Ms Leggett could be very difficult and “her conflicts with others are well documented.”[8]
[8] Ms Porteous’ supplementary statement dated 3 January 2018, [7].
Ms Porteous asserts that she was present in the majority of conversations between Mr Rudolph and Ms Leggett. She further asserts that there is well documented evidence of Ms Leggett having “conflicts” (plural) in the workplace.
The content and generality of Ms Porteous’ evidence, had it been introduced in the arbitral proceedings, may have prompted an application by Ms Leggett’s legal representatives to cross-examine Ms Porteous and potentially Mr Rudolph, at least as to the extent of time Mr Rudolph spent in the office.
Ms Leggett has not had the opportunity to respond to the statement. The opportunity to do so would have been considered by the Senior Arbitrator had the document been obtained and adduced into evidence in the arbitral proceedings. The Senior Arbitrator would have then been required to weigh the further evidence of Ms Porteous against that of Ms Leggett. The Senior Arbitrator would also have had to consider that evidence in the light of the balance of the evidence, including the tenor and content of the various emails discussed below.
Hawkesbury is attempting to introduce new evidence in order to cure the deficiencies in the case it put forward at the arbitration. New evidence on appeal is not evidence in reply and is not an opportunity to address weaknesses in Hawkesbury’s original case, as revealed in the primary decision. If a party wants to obtain such evidence, it must be obtained for the original hearing.[9] Parties in this jurisdiction are frequently reminded that the arbitration is not a dress rehearsal.[10] As Handley AJA (with whom Beazley and McColl JJA agreed) said in Preston v Harbour Pacific Underwriting Management Pty Ltd:[11]
“The requirement for the exercise of reasonable diligence reflects the principle that there must be an end to litigation and recognises that the pursuit of perfect justice can come at too high a price if it prolongs litigation with its attendant cost, inconvenience, and uncertainty. It prevents parties who have gone to trial under-prepared being rewarded for their lack of diligence with a second chance before another jury. The trial of an action is not a dress rehearsal for a second trial, or for a rehearing in an appellate court with additional evidence.”
[9] Marks v Ricegrowers’ Co-operative Ltd [2006] NSWWCCPD 46, [18].
[10] Super Retail Group Services Pty Ltd v Uelese [2016] NSWWCCPD 4, [92].
[11] [2008] NSWCA 216, [25].
In the light of all of the above, it would be procedurally unfair to allow Hawkesbury to adduce the further evidence of Ms Porteous on appeal. Additionally, it cannot be said that the evidence, if adduced, would result in a different outcome. The steps that would need to be taken in order to afford Ms Leggett procedural fairness may lead to the same result or a different result. That is pure conjecture, which is inconsistent with the test in Strickland.
I decline to admit the further statement of Ms Porteous dated 3 January 2018.
Hawkesbury’s reliance on Wicks[12] is misplaced. All of the documents could have been obtained prior to arbitration. None of the documents sought to be tendered, either individually or together, would be sufficient to conclude that the Senior Arbitrator would have arrived at a different outcome, and in the circumstances of the case, it is not just to admit them.
THE EVIDENCE
The lay evidence
[12] Wicks, [78].
Ms Vivienne Leggett
Ms Leggett provided a statement dated 27 September 2017.[13] Ms Leggett described her initial work duties with Hawkesbury in 1991 and the changing nature of those duties and the employment relationship over the years. From 2014, her salary structure included a weekly taxed amount, an amount per race day and performance bonuses in respect of sourcing sponsorship, arranging suppliers’ contracts, advertising and “on course” promotions.
[13] ARD pp 45–57.
Her duties included:
(a) securing sponsors;
(b) negotiating media partnerships;
(c) providing run sheets to management;
(d) arranging on course hiring; promotions and advertising;
(e) attending meetings with business chambers, Clubs NSW, sponsors and prospective clients, and
(f) associated administrative tasks.
She said she worked between 45 to 60 hours per week. Ms Leggett said that she enjoyed the full support of the Board and the Chief Executive Officer (CEO), Mr Brian Fletcher.
Mr Fletcher resigned in April 2016 and Mr Rudolph replaced him as CEO.
Ms Leggett stated that initially, Mr Rudolph’s requests for information appeared to her to be routine inquiries that he needed to make in order to understand the running of the organisation. She said that she had her first meeting with Mr Rudolph on 18 May 2016. Ms Leggett alleges that he told her she was earning “too much money” and that she would be earning half of that if she was employed at Gosford Race Club. Ms Leggett said that Mr Rudolph spoke rudely to her and on at least four occasions hung up on her. As an example, she said there was an error in the signage on a chocolate wheel, for which he blamed her, but it was his error.
Ms Leggett contends that it became apparent to her that Mr Rudolph was intending to arrange sponsors “behind her back.” She provided the example that Mr Rudolph had sent two other employees (Lea Porteous and Joanne Price, Hawkesbury’s Operations Manager) to visit a kitchen manufacturer and that he was working out promotions with them. Ms Leggett said that she had already organised a staff Christmas function with that company and this confused matters.
Ms Leggett reported that Mr Rudolph told her he was negotiating a deal with a wine company, but she already had an arrangement with another company, who were about to sign another three year contract.
Ms Leggett further reported two conversations, one with the CEO of Richmond Race Club, who reported that Mr Rudolph had made negative remarks to her about Ms Leggett and her position. The second was with Mr Rudolph, in which he indicated a plan to restructure her role by outsourcing her promotional and marketing role. Her sole responsibility would be sponsorship. Mr Rudolph commented to her that he may seek a university graduate to assist the office staff with media and advertising. Ms Leggett was advised she would be issued with a new contract within three weeks. She advised that that contract never eventuated.
Ms Leggett stated that from then, she received a number of emails.[14] Those emails were annexed to her statement and consisted of:
[14] ARD pp 75–78.
(a) an email dated 19 July 2016, questioning the cost of prize sashes and Ms Leggett’s response;
(b) an email from Mr Rudolph the following morning, requesting a long list of information to verify her responses to the questions in (a) above, by close of business that day. Mr Rudolph asked Ms Leggett:
(i)“[w]ho came up with” the fee for additional sashes and “how have you, if indeed you have, advised Lea or Joanne for accounting purposes?”
(ii)where were copies of the agreements reached about sponsorships and donations?
(iii)to provide verification that this information was provided to Ms Porteous and Ms Price for auditing purposes, and
(iv)for information about trophy arrangements for a race in September.
(c) Ms Leggett’s response on 20 July 2016 explaining the informal arrangements that had been in place over the previous years and that she had not before been questioned by the auditors. She advised she was “happy to come in and talk through any issues that need clarification however I am losing sleep and constantly thinking about these emails and other questions you are raising,” and
(d) Mr Rudolph’s response that his questions were not unreasonable and he required her co-operation and assistance to fulfil the obligation of his role.
Further emails followed, which included:[15]
(a) Two emails on 1 August and 2 August 2016. The first email (sent by Mr Rudolph) set out matters that were discussed in a meeting between Ms Leggett and Mr Rudolph, detailed changes in relation to payment for bookings, payment of Ms Leggett’s commission, and a number of what could be considered routine matters that would now require his authorisation, and a query in relation to catering arrangements for a function on 24 July 2016. The second was a detailed response from Ms Leggett.
(b) A number of further emails, which relevantly establish that Mr Rudolph had instructed Ms Leggett:
(i)not to deal with the Panthers Club sponsorship;
(ii)subsequently, to attend to a detail of that sponsorship, and
(iii)not to deal with any new contracts until a template was provided to her.
[15] ARD pp 79–84.
Ms Leggett said she was never given the template.
Ms Leggett stated that Mr Rudolph often spoke to her in a rude manner and, on at least four occasions, hung up the phone before she had finished. She gave examples of the words used by Mr Rudolph in conversations she had with him. She said she felt alienated and unsupported and communicated this to Mr Rudolph.
Ms Leggett said that on 22 September 2016, Mr Rudolph told her she was free to go the starting barriers whenever she wanted. She nominated two other people who were present at the time.
Ms Leggett stated that on 9 October 2016, she arranged with Ms Porteous to attend to giving the winner of the last race the sash if she was not back in time. Ms Leggett proceeded to go to the starting barrier to observe the start of the last race. Ms Leggett reports that just prior to the start of the race, Mr Rudolph rang her and, screaming at her, told her to “get yourself back here and do your own sashing” and “Don’t ever do that again without my approval.” Ms Leggett said she felt extremely anxious and very upset. Ms Leggett stated that the veterinarian was present at the time.
Ms Leggett stated that she subsequently had a conversation with Ms Porteous who said “I don’t know why Greg has singled you out and is picking on you. It seems very unfair.”
Ms Leggett also said that she had a conversation with Mr John Gollan afterwards in the car park when she complained to him about the phone conversation. Ms Leggett reported that Mr Gollan told her “I wouldn’t have answered the phone. I’d tell him to [expletive]”.
Ms Leggett reported that she was extremely upset and that evening sent Mr Rudolph an email expressing her upset and embarrassment. Ms Leggett attached the email to her statement. The email confirms she complained that:
(a) he was rude;
(b) he had hung up on her before she was able to give an explanation;
(c) he had authorised her to go to the barriers two weeks before;
(d) she had taken the opportunity because there was no sponsor for the race, and
(e) this incident compounded other situations when she “felt down trodden, excluded and questioned unreasonably” as she carried out her duties.
Ms Leggett stated that the following morning (10 October 2016) she was feeling upset and anxious about work when she received an email from Mr Rudolph (a copy of which was annexed to her statement) advising her to attend a meeting with him and Ms Price at his office the following day to discuss her work performance. She was advised she could bring a support person.
Ms Leggett said that she never returned to work after 9 October 2016. She stated there had never been an issue raised by the auditors about her record keeping.
Ms Leggett recorded events that followed. They are not relevant to the issues in dispute and will not be recited here.
In the Reply, an unsigned and undated document was annexed to the statement of Mr Rudolph.[16] The document was assumed by the Senior Arbitrator to be one prepared by Ms Leggett and reiterates many of the events complained of by Ms Leggett in her statement. It included reference to unreasonable time demands, lengthy email requests and abrupt cessation of telephone calls. Ms Leggett reported Mr Rudolph constantly harassed her about contracts and sponsorships and that she felt confined because she was required to get his permission all of the time.
[16] Reply pp 61–63.
She felt she was being “pushed out.”
Mr Gregory Rudolph
Mr Rudolph provided a statement dated 3 March 2017.[17]
[17] Reply pp 19–36.
Mr Rudolph stated that he commenced as the CEO of Hawkesbury after the position became vacant in April 2016. Relevantly, he said that he was very familiar with policies and guidelines in relation to bullying and harassment. He had been Manager of Racing New South Wales and in that role, had been required to assess and penalise bullying behaviour. He said his management and handling of staff had never been questioned.
Mr Rudolph gave details of a dispute that had arisen prior to his commencement between Ms Leggett and another staff member, that resulted in ongoing tension. He described the dispute as arising out of a “greying” of the responsibilities each had within their roles. He stated that as a result, he endeavoured to observe how each of them performed their roles so that he could draw up a written contract for each role, with guidelines. He said that Ms Leggett was aware of this.
Mr Rudolph stated that he was aware Ms Leggett was working from home but shortly after he started, he advised her that this was under review. Mr Rudolph said that he was not appraised of any budget or ongoing financial expenses or how her productivity was being measured. He said he needed to have that information in order to put in place a “firm clear arrangement on the parameters of her duties in the role as Marketing Manager.”
Mr Rudolph said that on 9 October 2016, Ms Porteous told him that Ms Leggett had asked her to perform the presentation duties as she was going to the barriers to watch the start of the race. Mr Rudolph said that Ms Porteous was concerned because that would leave the office unattended. Mr Rudolph recalled Ms Leggett mentioned to him previously that she had never been to the starter’s barrier.
Mr Rudolph stated that he called Ms Leggett in the presence of Ms Porteous and asked Ms Leggett to return. He told her she did not have permission. He said that he was calm, courteous and conducted himself in an “expected” normal manner.
Mr Rudolph denies having hung up the phone and denies any argument or any disagreement passed between them. He further denies that he spoke to Ms Leggett in the manner she described in the email of 9 October 2016.
Mr Rudolph said that he did not believe it to be appropriate to respond to Ms Leggett’s email complaint and instead arranged for the meeting, the subject of his email dated 10 October 2016. He said the meeting was to discuss what he had previously raised with her about her role, her duties and her responsibilities, “particularly following the 9 October decision she made about what she felt she could choose to do or not to do” and how such a decision could impact the organisation.
Mr Rudolph denied that he said she was earning too much money, he told her she was nothing or that he was micromanaging her. He further denied that he ever intimated she was going to be replaced. Mr Rudolph gave examples of matters that he raised with Ms Leggett and his reasons for doing so, including:
(a) he had heard from a third party that she and her family used meal vouchers meant for patrons;
(b) an error in the printing on a chocolate wheel about the amount of the prize money (which he said was her responsibility);
(c) the methodology Ms Leggett had been using to come to sponsorship arrangements, for which a template was to be designed, and
(d) the receipt of an invoice for a prize, one of which had been delivered to a patron who had won the prize. He denied ever accusing her of having products delivered to her home.
Mr Rudolph asserted that when he spoke to Ms Leggett, it was never in a critical, aggressive or harsh manner and that he often praised her publicly. He said she was never excluded from functions. Function tickets were shared among the staff at his discretion. He added Ms Leggett went to functions and networking events she or others had organised. He would often not know she attended and “that was how she operated.”
Mr Rudolph acknowledged that there was one occasion when he did not know she was in the office and he bought the other staff, but not her, a coffee.
Mr Rudolph advised that the first time he was aware Ms Leggett had any grievance against him was on 9 October 2016, when he received the email from her.
Ms Lea Porteous
Ms Porteous made a statement dated 3 March 2017.[18] She said that she and Ms Leggett were required to work fairly closely together, which involved approximately twenty telephone calls between them per day.
[18] Reply pp 64–70.
Ms Porteous said she never heard Mr Rudolph speak to Ms Leggett in an arrogant or harsh manner. He never yelled or raised his voice, but spoke to Ms Leggett at an “authoritive” level.
Ms Porteous reports that on 9 October 2016, Ms Leggett asked her to attend to putting the sash on the winning horse as there was no sponsor for the race and she was going to the starting barriers. Ms Porteous reported that Ms Leggett indicated she would likely be back in time.
Ms Porteous stated that Mr Rudolph later came into the office and she told him she could not let Ms Price leave the office to collect cash because Ms Porteous had been asked to attend to the sash for the winning horse. In her presence, Mr Rudolph rang Ms Leggett and asked her “Why are you out there when you have a job to do here?” Ms Porteous said that he did not yell or demean her or abuse or harass her. His tone was authoritative.
Ms Porteous recalled that Ms Leggett asked her on one occasion why she was being questioned.
Ms Porteous stated that the questions Mr Rudolph asked Ms Leggett were the same sort of minor questions he asked her and Ms Price. Ms Porteous further contended that Ms Leggett had clashes “with anyone and everyone” and that she talked down to everyone. Ms Porteous observed that Ms Leggett was difficult to work with, but was passionate about her job.
Ms Joanne Price
Ms Price also made a statement on 3 March 2017.
Ms Price observed that in conversations she has overheard between Mr Rudolph and Ms Leggett, she has never heard Mr Rudolph question Ms Leggett’s integrity and never heard him speak to her arrogantly or harshly. Ms Price stated that the questions Mr Rudolph asked of Ms Leggett were of the same type as those he asked Ms Porteous and her.
The medical evidence
The clinical notes from Ms Leggett’s treating general practitioner from 10 October 2016 to 17 February 2017 were adduced in evidence.[19]
[19] ARD pp 16–18.
The notes confirm that Ms Leggett attended Dr Tran at the clinic on 10 October 2017, complaining of:
“Stress work issues with boss; feels depressed; poor concentration affecting sleep, feels being harassed/bullied
Anxious Stress at work”.
Ms Leggett was prescribed medication and provided with a medical certificate. Ms Leggett consulted Dr Tran on seven further occasions when she complained of a number of psychological symptoms including feeling teary, being unable to sleep and difficulty concentrating. Ms Leggett was referred to a psychologist and a GP mental health program was initiated.
Ms Leggett was also referred by Dr Tran to Dr Jovanova, psychiatrist, who provided two reports. The first report dated 27 April 2017 was directed to Dr Tran and the second report dated 20 June 2017, was directed to Ms Leggett’s legal representatives.[20]
[20] ARD pp 19–26.
Dr Jovanova recorded that there was no prior psychological history. Dr Jovanova summarised the history of work related issues and the onset of psychiatric symptoms, with a diagnosis of adjustment disorder with depressed mood and anxiety. In the report dated 20 June 2017, Dr Jovanova reported that symptoms were persisting and were causally related to work stressors.
Ms Leggett also relied on a forensic medical report from Dr Parsonage, psychiatrist, dated 24 July 2017.[21]
[21] ARD pp 1–9.
Dr Parsonage took a detailed history, including Ms Leggett’s stable upbringing and work history. He noted there was no prior psychological history.
The history taken of work-related issues arising out of Mr Rudolph’s alleged behaviour was consistent with Ms Leggett’s statement. Dr Parsonage recorded the events of 9 and 10 October 2016 and onset of symptoms consistent with a psychiatric disorder thereafter. He diagnosed a Major Depressive disorder with Anxious distress, and symptoms persisted.
Dr Parsonage opined:
“[Ms] Leggett’s psychological health was progressively eroded from mid 2016 to 9 October 2016 by at least her perception that she was being treated unfairly, that her integrity was being questioned and that the CEO was deliberately creating circumstances in which she would either be forced to leave or he would have grounds to remove her from her position.
The incident on 9 October 2016 was the last straw of a series of unreasonable behaviours by the CEO towards [Ms] Leggett.”
Dr Parsonage formed the view that Ms Leggett’s psychological decompensation was as a result of a cumulation of stressors and the events of 9 and 10 October 2016.
Hawkesbury relied on the forensic medical report from Dr Smith, psychiatrist, dated 23 March 2017. Dr Smith took a history of no prior symptoms and no work-related stressors until Mr Rudolph became the CEO. He recorded that Ms Leggett complained that Mr Rudolph did not have trust in her, and that she felt belittled and tormented. She felt Mr Rudolph was trying to get rid of her.
Dr Smith further recorded that Ms Leggett said that while she was upset with those issues, she did not have time off work and did not seek any psychological treatment. Dr Smith reported that after the telephone conversation with Mr Rudolph on 9 October 2016, Ms Leggett became upset and was crying. She went home. Dr Smith stated that when Ms Leggett received the email dated 10 October 2016 to attend for a meeting, she “had a breakdown.” She had abnormally high blood pressure, no motivation and was depressed and anxious.
Dr Smith noted ongoing symptoms of depressed mood, fatigue, loss of interest, poor concentration and memory, and social withdrawal. He diagnosed Major Depressive Disorder (moderate to severe) that had become clinically significant after 9 October 2016.
Dr Smith opined the predominant contributing factors to the onset of the condition were the direction to return from the barriers on 9 October 2016 and the requirement to meet with Mr Rudolph to discuss her work performance. He recommended treatment by a psychiatrist and ongoing psychological therapy.
THE SENIOR ARBITRATOR’S REASONS
The Senior Arbitrator identified the issues to be determined as:
(a) whether Ms Leggett suffered a primary psychological condition during the course of her employment with Hawkesbury and whether her employment was the main contributing factor to the injury;
(b) the extent and quantification of Ms Leggett’s entitlement to weekly compensation;
(c) liability for medical expenses, and
(d) whether Ms Leggett’s psychological injury was wholly or predominantly caused by reasonable action taken or proposed to be taken by Hawkesbury with respect to discipline.
The Senior Arbitrator provided a thorough summary of Ms Leggett’s statement evidence and the document annexed to Mr Rudolph’s statement. He further provided a summary of the lay evidence of Mr Rudolph, Ms Porteous and Ms Price. He reviewed the medical evidence from Ms Leggett’s treatment providers, as well as Dr Parsonage and Dr Smith.
The Senior Arbitrator also reviewed each of the emails in evidence, commencing on 20 July 2016 and culminating on 10 October 2016. He quoted the contents of the emails from Ms Leggett to Mr Rudolph sent at 9.15 am on 20 July 2016 (referred to at [79(c)] above), and the emails dated 1 August 2016, 20 September 2016 and 10 October 2016.
The Senior Arbitrator summarised Hawkesbury’s submissions as follows:
(a) the issues are of causation and its s11A defence;
(b) the allegation of bullying and harassment was denied and any events prior to 9 October 2016 were only “background” events and were not causative of injury;
(c) the medical evidence in support of Ms Leggett’s case cannot be accepted because the doctors did not have the lay evidence of Hawkesbury’s employees. Further Dr Parsonage did not “appreciate the significance of the events” of 9 and 10 October 2016;
(d) the effect of the events of 9 and 10 October 2016 was that Ms Leggett suffered a breakdown. If it was accepted there was an injury on 9 and 10 October 2016, it was wholly or predominantly caused by those events, which were disciplinary actions. Dr Smith supported the argument on causation;
(e) the evidence does not establish Mr Rudolph was rude or aggressive or unreasonable in manner or tone. Mr Rudolph’s actions had to be considered in the light of the task he had to achieve, and
(f) the events of 9 and 10 October 2016 were reasonable action by the employer with respect to discipline.
The Senior Arbitrator also summarised Ms Leggett’s submissions, which were in essence that:
(a) both Dr Parsonage and Dr Smith considered Ms Leggett had suffered an injury and both had a history of the events leading up to 9 October 2016;
(b) many of the factual matters were not disputed and they were real events. Ms Leggett’s perception of those events was relevant, not whether Mr Rudolph acted reasonably. The reasonableness was only relevant to the incident on 10 October 2016 which was the beginning of the disciplinary process, or if it began with the incident on 9 October 2016, that action was not reasonable;
(c) the emails dated 20 July 2016 and 9 October 2016 are consistent with the history provided to the doctors, and
(d) Ms Leggett was denied procedural fairness with respect to the proposed meeting of 10 October 2016, and the event of 9 October 2016 in isolation would not have been sufficient to cause the onset of symptomology.
The Senior Arbitrator identified that he was first required to ascertain whether the events relied upon occurred.
He said that Ms Leggett’s allegations had largely been refuted by Mr Rudolph and each party’s version of the events was in stark contrast to the other.
In relation to the evidence of Ms Porteous, the Senior Arbitrator observed that the fact that Ms Porteous never heard Mr Rudolph speak in the manner alleged did not mean that he did not do that. Further Ms Porteous did not deny that she told Ms Leggett she did not know why Mr Rudolph was singling Ms Leggett out. The Senior Arbitrator also said that Ms Price’s evidence that she had never observed or heard Mr Rudolph conduct himself in the manner alleged was not evidence that he did not conduct himself that way at times.
The Senior Arbitrator said that the emails that passed between Mr Rudolph and Ms Leggett give “significant” support for her claim.
He said the manner and apparent tone of the email from Mr Rudolph dated 20 July 2016 is of concern and “could easily have been viewed as an abusive inquisition, rather than an innocent request for information.”[22] The Senior Arbitrator said Ms Leggett’s response 90 minutes later was understandable. Further, the Senior Arbitrator said that in her response she advised she was losing sleep, was constantly thinking about emails and the questions he was raising. This evidence showed that Ms Leggett was experiencing difficulties well before October 2016.
[22] Leggett v Hawkesbury Race Club Limited [2017] NSWWCC 292 (Reasons), [132].
The Senior Arbitrator observed that it was not unreasonable for Ms Leggett to be troubled by Mr Rudolph’s direction that deliveries to her home should cease when she had never had items delivered to her home.
The Senior Arbitrator said that the manner in which Mr Rudolph asked questions in emails was of concern, particularly the email dated 20 September 2016. The Senior Arbitrator observed that in that email, “[h]is reference to the words ‘if as you say’ seems to connote some disbelief on Mr Rudolph’s part.”[23] Further, Ms Leggett’s account of the telephone conversation on 9 October 2016 was supported by her email sent to Mr Rudolph on the same day.
[23] Reasons, [132].
The Senior Arbitrator said that while Mr Rudolph denied many of the allegations, he conceded some of the events did occur and the emails provide support for Ms Leggett’s allegations. He said that Mr Porteous and Ms Price only gave evidence that they never observed Mr Rudolph act inappropriately in his dealings with Ms Leggett, but both described his manner as authoritative, which tended to assist Ms Leggett’s evidence.
The Senior Arbitrator considered the principles laid down by Deputy President Roche in Attorney General’s Department v K[24] and, in applying those principles, formed the view that on a review of the evidence as a whole, he was satisfied that the events occurred and were not imaginary. He said Ms Leggett had issues with Mr Rudolph’s management style from the time Mr Rudolph became CEO in May 2016.
[24] [2010] NSWWCCPD 76; 8 DDCR 120, (Attorney General’s Department v K), [52].
The Senior Arbitrator said that he had no reason to doubt the veracity of Ms Leggett’s evidence and her perception of real events, which she believed to be bullying and harassment. On that basis, the Senior Arbitrator found on the balance of probabilities Ms Leggett was exposed to bullying and harassment during the course of her employment prior to 10 October 2016.
The Senior Arbitrator then proceeded to consider the issue of whether Ms Leggett suffered injury as a result of that conduct and whether her employment was the main contributing factor.
The Senior Arbitrator reviewed relevant caselaw[25] and considered the principles required to establish whether Ms Leggett suffered a psychological injury. He said there was no dispute that Ms Leggett suffered from a psychological condition. The issue for him to determine was whether she had sustained an injury within the meaning of s 4 of the 1987 Act.[26]
[25] Stewart v NSW Police Service [1998] NSWCCR 57; 17 NSWCCR 202 (Stewart); Commonwealth of Australia v Smith [2005] NSWCA 478 (Smith), [16].
[26] Reasons, [147].
Referring to Castro v State Transit Authority (NSW)[27] and Lyons v Master Builders Association of NSW Pty Ltd,[28] the Senior Arbitrator identified that in order to be satisfied an injury occurred, there must be evidence of a sudden or identifiable pathological change.
[27] [2000] NSWCC 12; 19 NSWCCR 496.
[28] (2003) 25 NSWCCR 422.
The Senior Arbitrator observed that the issue of causation must be determined by the facts in each case. He considered the Court of Appeal authority of Kooragang Cement Pty Ltd v Bates[29] and the subsequent decision of the High Court in Comcare v Martin.[30] Applying Comcare v Martin, the Senior Arbitrator concluded that:
“[t]he legislation must be interpreted by reference to the terms of the statute and its context in a fashion that best effects its purpose. This is not a new concept. Sections 4(b), 9A and 11A of the 1987 Act contain specific requirements and the provisions need to be interpreted using standard principles of interpretation. This does not mean that the common sense approach has no place in the application of the legislation to the facts of the case.”[31]
[29] (1994) 35 NSWLR 452; 10 NSWCCR 796.
[30] [2016] HCA 43; 258 CLR 467 (Comcare v Martin).
[31] Reasons, [152].
The Senior Arbitrator considered it necessary to look more closely at the histories provided to Dr Tran, Dr Jovanova, Dr Parsonage and Dr Smith and noted those histories. He was of the view that because Dr Tran had not provided a report, his evidence was of little weight. The Arbitrator noted that Dr Jovanova and Dr Smith had similar histories with respect to Ms Leggett’s complaints about Mr Rudolph’s communications with her since May 2016 and the final event on 10 October 2016, described by Dr Parsonage as the “last straw.”
The Senior Arbitrator pointed out that both Dr Parsonage and Dr Smith had obtained consistent histories and diagnosed a Major Depressive Disorder, but that Dr Smith had disregarded the events prior to 9 October 2016, as they had not had an impact on her mood (an approach which Dr Parsonage thought “overly simplistic”).
The Senior Arbitrator was of the view that Dr Parsonage, Dr Jovanova and Dr Smith all opined that Ms Leggett suffered a psychological injury as a result of her dealings with Mr Rudolph, although Dr Smith’s opinion on causation was that the events causing injury were limited to those of 9 and 10 October 2016.
The Senior Arbitrator determined that he had no doubt that the events of 9 and 10 October 2016 contributed to Ms Leggett’s psychological condition. However, having regard to the medical evidence, the emails, the histories provided to the doctors and Ms Leggett’s statement, he was satisfied that Ms Leggett suffered an injury arising out of or in the course of her employment as a result of dealings with Mr Rudolph between May 2016 and 10 October 2016. He determined the deemed date of injury to be 10 October 2016.
Relying on the Macquarie Dictionary definition of “main”, the Senior Arbitrator was of the view that “main contributing factor” meant the chief or principal contributing factor, and that “mainly” was more than substantially but less than totally or wholly. He determined that most, if not all of the events were the “whole and predominant” cause of Ms Leggett’s injury and that her employment was the main contributing factor to the contraction of the disease.
The Senior Arbitrator then turned his mind to the defence raised by Hawkesbury that the injury was wholly or predominantly caused by reasonable action with respect to discipline.
The Senior Arbitrator was of the view that he did not need to consider the defence because it relied solely on the events of 9 and 10 October 2016, and he had already determined that the earlier events were causative. He further commented, however, that consideration of reasonableness is an objective test based on the concept of fairness. He quoted the unreported decision of Geraghty J in Irwin v Director General of School Education[32] where his Honour referred to the test as requiring the rights of the employee to be weighed against the objective of the employment. The Arbitrator further referred to authorities that establish that the manner in which the action is conducted is a relevant consideration.[33]
[32] (Compensation Court of NSW, Geraghty CCJ, 18 June 1998, No 14068 of 1997, unreported) (Irwin).
[33] Northern NSW Local Health Network v Heggie [2013] NSWCA 255 (Heggie); Department of Education & Training v Sinclair [2005] NSWCA 455; 4 DDCR 206 (Sinclair); Ivanisevic v Laudet Pty Ltd (Truss CCJ, 24 November 1998, unreported).
The Senior Arbitrator noted Hawkesbury’s reliance on Dr Smith’s view that the injury was caused only by the events on 9 and 10 October 2016. Hawkesbury argued these were disciplinary actions as defined in Kushwaha v Queanbeyan City Council,[34] and were conducted reasonably and not in an aggressive or hostile manner.
[34] [2002] NSWCC 25.
The Senior Arbitrator indicated that he had already rejected Dr Smith’s view that only the two most recent events were causative of the injury. He determined that the manner in which Mr Rudolph had asked Ms Leggett to return from the barriers was not reasonable, in the context of having previously given permission for her to go.
The Senior Arbitrator further referred to Mr Rudolph’s evidence that he did not consider the incident significant enough to warrant further action and it was not until he received Ms Leggett’s email of complaint that evening that he set up the “performance” meeting. His evidence was that he intended to discuss her role, duties and responsibilities. The Senior Arbitrator said that a discussion of her role, duties and responsibilities did not constitute a disciplinary meeting and it would have been appropriate to mention that it was not a disciplinary meeting in the email. Further, it would have been helpful to provide details of what was going to be discussed. The short content of the email and the indication she could bring a support person to the meeting would without doubt have been of concern to Ms Leggett.
The Senior Arbitrator said that in his view, the manner in which Ms Leggett was asked to attend the meeting, the lack of detail provided and the short notice was unreasonable in accordance with the principles in Heggie and Sinclair. The Senior Arbitrator said that he was not satisfied that Ms Leggett’s injury was solely as a result of the events on 9 and 10 October 2016, but in any event, he was not satisfied that the injury was wholly or predominantly caused by reasonable action taken with respect to discipline.
The Senior Arbitrator proceeded to award Ms Leggett weekly compensation, together with treatment expenses pursuant to s 60 of the 1987 Act. Although Hawkesbury is seeking to have all orders revoked on appeal, it is on the basis that the decision is affected by error in respect of the determination of injury, causation and s 11A. There is no contention that the Senior Arbitrator erred in respect of his assessment of Ms Leggett’s incapacity or need for treatment. I will not, therefore, record the Senior Arbitrator’s reasons for his findings on those aspects of the case.
The Certificate of Determination issued on 7 December 2017 records:
“The Commission determines:
1. The applicant sustained a psychological injury arising out of or in the course of her employment from May 2016 to 10 October 2016 (deemed).
2. The applicant’s employment was the main contributing factor to her injury.
3. The applicant has no current work capacity from 10 October 2016 to date.
4. The applicant requires medical treatment as a consequence of her injury.
5. The applicant’s psychological injury was not wholly or predominantly caused by reasonable action taken or proposed to be taken by the respondent with respect to discipline.
The Commission orders:
6. The respondent to pay the applicant $2058.10 per week from 10 October 2016 to 8 January 2017 pursuant to s 36(1)(b) of the Workers Compensation Act 1987.
7. The respondent to pay the applicant $2058.10 per week as adjusted from 9 January 2017 to date and continuing pursuant to s 37(1)(b) of the Workers Compensation Act 1987.
8. The respondent pay the applicant’s reasonably necessary medical expenses pursuant to s 60 of the Workers Compensation Act 1987.
9. No order as to costs.”
GROUNDS OF APPEAL
Hawkesbury set out its grounds of appeal in the original Appeal document. The amended Appeal added a further ground and amended some parts of the earlier grounds. Hawkesbury alleges the following grounds of appeal:
(a) Ground One: The Senior Arbitrator erred in fact, law or discretion by finding that Ms Leggett sustained a psychological injury within the meaning of s 4 of the 1987 Act.
(b) Ground Two: The Senior Arbitrator erred in law by finding that Ms Leggett discharged her onus of proof on causation in ss 4 and 9A of the 1987 Act.
(c) Ground Three: The Senior Arbitrator erred in law by misapplying the test for causation in ss 4 and 9A of the 1987 Act.
(d) Ground Four: The Senior Arbitrator erred in fact, law and discretion in failing to properly consider the inadequacy of Ms Leggett’s medical evidence.
(e) Ground Five: The Senior Arbitrator erred in fact and discretion by finding that the events raised by Ms Leggett did in fact occur as alleged in the following ways:
(i)finding that the events raised by Ms Leggett did in fact occur was against the weight of the evidence (including two independent witnesses, Ms Porteous and Ms Price);
(ii)finding that Ms Leggett’s evidence gained significant support from the emails that passed between her and Mr Rudolph;
(iii)finding that the manner in which the emails were composed by Mr Rudolph and the apparent tones was of some concern, and
(iv)finding that Ms Leggett’s version of events of a telephone conversation on 9 October 2016 was supported by a contemporaneous record in the form of her email in the context of being contrary to the evidence of Mr Rudolph and the independent witness, Ms Lea Porteous.
(f) Ground Six: The Senior Arbitrator erred in finding that Ms Leggett’s perception of events was sufficient to characterise those events as bullying and harassment when the weight of evidence (including two independent witnesses) did not support any finding that there was any behaviour that would justify a finding of bullying or harassment at any stage.
(g) Ground Seven: The Senior Arbitrator erred in law in that he determined the matter on a basis not put by or put to the parties.
(h) Ground Eight: The Senior Arbitrator erred in fact, law and discretion in dismissing the appellant’s s 11A defence by:
(i)misapplying the test for s 11A;
(ii)failing to find that any psychological injury suffered by the respondent (which is not conceded) was wholly or predominantly caused by the appellant’s reasonable action with respect to discipline, and
(iii)having regard to events prior to the pleaded date of injury (9 October 2016), other than as merely background events or history.
(i) Ground Nine: The Senior Arbitrator erred in respect of each ground of appeal in that he:
(i)failed to give adequate or sufficient reasons;
(ii)failed to properly consider and evaluate the evidence, and
(iii)erred in accepting the medical evidence relied on by Ms Leggett and preferring that evidence over the evidence relied on by Hawkesbury, and failed to properly assess and take into account the credit of Ms Leggett.
LEGISLATION
“Injury” is defined in s 4 of the 1987 Act as follows:
“4 Definition of ‘injury’ (cf former s 6 (1))
In this Act:
injury:
(a) means personal injury arising out of or in the course of employment,
(b) includes a disease injury, which means:
(i)a disease that is contracted by a worker in the course of employment but only if the employment was the main contributing factor to contracting the disease, and
(ii)the aggravation, acceleration, exacerbation or deterioration in the course of employment of any disease, but only if the employment was the main contributing factor to the aggravation, acceleration, exacerbation or deterioration of the disease, and
(c) does not include (except in the case of a worker employed in or about a mine) a dust disease, as defined by the Workers’ Compensation (Dust Diseases) Act 1942, or the aggravation, acceleration, exacerbation or deterioration of a dust disease, as so defined.
Section 11A of the 1987 Act relevantly provides:
“11A No compensation for psychological injury caused by reasonable actions of employer
(1) No compensation is payable under this Act in respect of an injury that is a psychological injury if the injury was wholly or predominantly caused by reasonable action taken or proposed to be taken by or on behalf of the employer with respect to transfer, demotion, promotion, performance appraisal, discipline, retrenchment or dismissal of workers or provision of employment benefits to workers.
(3) A psychological injury is an injury (as defined in section 4) that is a psychological or psychiatric disorder. The term extends to include the physiological effect of such a disorder on the nervous system.
(4) This section does not affect any entitlement to compensation under this Act for an injury of a physical nature even if the injury is a physical symptom or effect of a psychological injury, so long as the injury is not merely a physiological effect on the nervous system.
(5) (Repealed)
(6) This section does not extend the definition of injury in section 4. In particular, this section does not affect the requirement in section 4 that a disease is not an injury unless it is contracted by the worker in the course of employment.
This section does not affect section 9A (No compensation payable unless employment substantial contributing factor to injury).(7) ...
(8) … ”
SUBMISSIONS
Hawkesbury’s submissions
Grounds 1–7
Hawkesbury has adopted the rather unhelpful approach of making submissions on grounds one to seven “jointly.”
It alleges that the Senior Arbitrator erred in his finding at [127] and in his reasons that he was satisfied that the events complained of by Ms Leggett did occur and were not imaginary. Hawkesbury says that the Senior Arbitrator was influenced by inaccurate and misleading assertions that the facts relied upon were not disputed.[35]
[35] Transcript of Proceedings, Leggett v Hawkesbury Race Club Limited (WCC, [2017] NSWWCC 292, Senior Arbitrator Capel, 7 December 2017), T 21.27–22.4.
Hawkesbury asserts that Mr Rudolph did not accept any of the events occurred claimed by Ms Leggett, namely:
(a) he told her she earned too much money;
(b) he told her she was “nothing”;
(c) he spoke to her in a rude manner and hung up on her;
(d) he questioned her integrity;
(e) he placed unreasonable demands on her, and
(f) he screamed down the phone on 9 October 2016 with rage in his voice, and constantly harassed her about contracts and sponsorships.
Hawkesbury submits that Ms Porteous and Ms Price expressly denied those events occurred.
Hawkesbury says that Mr Rudolph “did not explain his position in respect of each one of the events claimed by [Ms Leggett]” and was not given the opportunity to do so. It contends that the statement evidence provided by Mr Rudolph, Ms Porteous and Ms Price were provided in answer to allegations made by Ms Leggett in February 2016, and were not in response to her more specific allegations made in the statement annexed to the ARD dated 20 September 2017. Nevertheless, it submits that the allegations referred to in [164] above were expressly denied by the three witnesses, Mr Rudolph, Ms Porteous and Ms Price.
Hawkesbury contends that the Senior Arbitrator could only find Mr Rudolph spoke in an authoritative voice on a number of occasions and that, in the same manner, he asked her to return from the starting barriers. It says these were the only “real events.”
Hawkesbury asserts that it has been denied procedural fairness because it has been denied the opportunity to respond to the case put against it. It submits that the Senior Arbitrator’s finding that real events occurred, required him to address the conflict in the evidence. Hawkesbury says that the Senior Arbitrator addressed the evidence of Ms Porteous and Ms Price by finding that their evidence only went so far as to establish what they observed, not whether the alleged events occurred.
Hawkesbury submits that the finding is critical to the Senior Arbitrator’s rejection of the evidence of all three of its witnesses. It contends that the possibility that the events could have occurred in the absence of the two lay witnesses was never raised by the Senior Arbitrator or argued by Ms Leggett. It submits it has been denied the opportunity to respond to that possibility.
Hawkesbury further asserts that despite the Senior Arbitrator dismissing their evidence, there was an absence of challenge to the credit of both Ms Porteous and Ms Price and an absence of adverse findings as to their credit. It submits that the three witnesses ought to have been given the opportunity to give evidence, and Hawkesbury ought to have had the opportunity to make submissions about the matters upon which the Senior Arbitrator made “critical” findings of fact. Hawkesbury relies on the Court of Appeal decision in Seltsam v Ghaleb[36] as support for the proposition that it was denied procedural fairness because the qualifications expressed by the Senior Arbitrator were outside the basis upon which the case was run and the Senior Arbitrator failed to inform the parties. The Senior Arbitrator did not give them the opportunity to address those considerations.
[36] [2005] NSWCA 208; 3 DDCR 1 (Ghaleb), [69]–[79].
Hawkesbury submits that it is not necessary for it to establish what the Senior Arbitrator’s decision would have been. It is sufficient to establish the findings infected the decision-making process and that is a proper basis to have the COD set aside.
Hawkesbury further contends that the Senior Arbitrator erred by failing to take into account relevant evidence and failing to engage with the evidence as required by the principles enunciated in Tudor Capital Australia Pty Ltd v Christensen.[37] In particular, Hawkesbury submits that:
(a) Ms Leggett did not plead a “nature and conditions” claim but nominated the date of injury as 9 October 2016;
(b) the evidence of Mr Rudolph and Ms Porteous unequivocally established that the telephone call on 9 October 2016 was in an authoritative tone but Mr Rudolph did not yell, abuse or harass Ms Leggett. There was no suggestion that Ms Porteous was not present during that telephone call;
(c) the Senior Arbitrator failed to consider and engage with the evidence by accepting Ms Leggett’s evidence based on what the Senior Arbitrator considered the contemporaneous email dated 9 October 2016 directed to Mr Rudolph. Hawkesbury says that the Senior Arbitrator has effectively determined that Ms Porteous lied when there has been no challenge to her evidence or her credit;
(d) in the context of the pleaded date of injury, if the event of 9 October 2016 (which was described as “the last straw”) is not proved, then Ms Leggett’s claim fails in its entirety, and
(e) further, the Senior Arbitrator failed to engage with the evidence of Mr Rudolph, who unequivocally denied the alleged conduct and whose evidence was corroborated by both Ms Porteous and Ms Price. Hawkesbury asserts that the Senior Arbitrator has effectively determined that Mr Rudolph lied.
[37] [2017] NSWCA 260.
Hawkesbury submits that both the Senior Arbitrator and Ms Leggett have misdirected themselves as to the proper application of State Transit Authority v Chemler[38] and “associated” authorities. Hawkesbury says that each has proceeded on the basis of an alleged perception of alleged events, rather than properly determining what “real events” occurred. It contends that the only real events that occurred were that Mr Rudolph spoke in an authoritative manner on a number occasions and that in a telephone call on 9 October 2016, he directed Ms Leggett to return from the barriers, again in an authoritative manner. Hawkesbury adds “That and no more.”[39] Presumably that submission means that there were no other events that could be proved.
[38] [2007] NSWCA 249; 5 DDCR 287 (Chemler).
[39] Hawkesbury’s submissions, p 13, [25].
Hawkesbury contends that once it is accepted that they are the only established events, then Ms Leggett’s claim must fail. It submits that the facts are distinguishable to those of Chemler, in which there was an offensive racist sign posted in the workplace. Hawkesbury states that it would be absurd to consider being spoken to in an authoritative manner and being told to return to the workplace as sufficient to constitute a perception of being bullied and harassed. It would result in an absurdity in the management of a workplace.
Hawkesbury submits the error extends to the acceptance of the medical evidence as to psychological injury. It submits that a failure to establish the events occurred (upon which the medical evidence relied) results in a failure to establish a psychological injury occurred. Hawkesbury maintains that the Arbitrator has fallen into error of law in finding that Ms Leggett has discharged the onus in proving injury (s 4) and substantial contributing factor (s 9A).
Hawkesbury submits the errors are critical, because once s 4 is satisfied, the onus shifts to Hawkesbury “but without doing so the inquiry proceeds no further.”[40] The submission is somewhat obtuse. Presumably, Hawkesbury is referring to the onus shifting to it, once injury is established, because the next step is to apply s 11A of the 1987 Act. Hawkesbury submits that the Senior Arbitrator acknowledged that submission, saying “Sorry if you don’t accept the allegations of bullying and harassment prior to the 9th and 10th the applicant should fail.”[41] Hawkesbury maintains that the allegations have not been made out and the claim should fail.
Ground 8: The Senior Arbitrator erred in fact, law and discretion in dismissing the appellant’s s 11A defence.
[40] Hawkesbury’s submissions, p 14, [29].
[41] T 7.32–35.
The error is alleged to have been incurred by:
(a) misapplying the test for s 11A;
(b) failing to find that any psychological injury suffered by the respondent (which is not conceded) was wholly or predominantly caused by the appellant’s reasonable action with respect to discipline, and
(c) having regard to events prior to the pleaded date of injury (9 October 2016), other than as merely background events or history.
Hawkesbury alleges there were two ways in which the Senior Arbitrator fell into error. The first was that he determined at [171] of his Reasons that because he had found injury over the period from May 2016 to 10 October 2016, he considered that it was unnecessary to decide the s 11A defence. The s 11A defence was limited to the events on 9 and 10 October 2016. Secondly, the Senior Arbitrator erred in finding that the actions taken by Mr Rudolph were not reasonable and did not constitute discipline.[42]
[42] Reasons, [178]–[188].
As to the first alleged error, Hawkesbury submits:
(a) The Senior Arbitrator misdirected himself by having regard to events prior to 9 October 2016 which were not “real events.” The Senior Arbitrator attempted to make Ms Leggett’s case for her. Hawkesbury cites the passage in the transcript of proceedings where the Arbitrator summarised Ms Leggett’s primary case that all the events were causative and the events on 9 and 10 October were not wholly or predominantly the cause of injury. Hawkesbury further quotes the Senior Arbitrator’s summation of Ms Leggett’s argument that Dr Smith has “pushed aside” the earlier events.[43]
(b) Ms Leggett attempted to resile from the pleadings, which alleged the injury occurred on 9 and 10 October 2016. Hawkesbury submits that this occurred after the Senior Arbitrator suggested the date of injury was “up to and including” 9 and 10 October 2016.[44] Hawkesbury submits that if a construction of the pleadings was not interfered with, the Senior Arbitrator would have no choice but to apply s 11A because there were no “real events” pleaded which fell outside of s 11A. Hawkesbury submits that the Senior Arbitrator articulated this when he said:
“Sorry, if you don’t accept the allegations of bullying and harassment prior to the 9th and 10th October, the applicant should fail.”[45]
(c) Ms Leggett acknowledged that the medical evidence shows that her claim would fail without the events of 9 and 10 October 2016, when referring in her submissions to Dr Parsonage’s opinion that these two incidents were the “last straw.”[46]
(d) If the Senior Arbitrator had accepted that all of the evidence showed there were no “real” events that occurred prior to 9 October 2016, the “last straw” would be the only significant events and the claim should have been excluded by operation of s 11A. Hawkesbury contends that the amendment to the pleadings (which it says was effectively made by the Senior Arbitrator) has opened the gate for the Senior Arbitrator to consider whether Ms Leggett was exposed to bullying and harassment prior to 9 October 2016.
(e) The finding by the Senior Arbitrator that there was no reason to doubt Ms Leggett’s evidence or her perception of the events was not open to him. Hawkesbury relies on submissions made “elsewhere.”
[43] T 33.6–19.
[44] T 5.14–26.
[45] T 7.32–35.
[46] T 23.26–30.
As to the second error under this ground, (finding that the actions taken by Mr Rudolph were not reasonable and did not constitute discipline), Hawkesbury submits that the Senior Arbitrator erred in determining that the manner in which Mr Rudolph asked Ms Leggett to return from the barriers was not reasonable. The error is said to stem from the Senior Arbitrator taking into account that Mr Rudolph had previously told Ms Leggett she could go the barriers, which was denied by Mr Rudolph.
Hawkesbury submits that the Arbitrator has failed to engage with the evidence of Mr Rudolph.
Hawkesbury further submits that a request to attend a meeting to discuss performance within 24 hours was not unreasonable. Ms Leggett did not request an extension of time and did not seek details of what was to be discussed. In the absence of those requests it was not open to the Senior Arbitrator to make adverse findings against Hawkesbury.
Hawkesbury contends that the real events were limited to Hawkesbury’s reasonable actions, which fall squarely within s 11A.
Ground 9: The Senior Arbitrator erred in respect of each ground of appeal in that he:
(a) failed to give adequate or sufficient reasons;
(b) failed to properly consider and evaluate the evidence;
(c) erred in accepting the medical evidence relied on by the respondent and preferring that evidence over the evidence relied on by the appellant, and
(d) failed to properly assess and take into account the credit of the respondent.
Hawkesbury makes no further submissions and relies on submissions made in relation to Grounds 1–8 for “specific instances of the matters contained in Ground 9.”
Ms Leggett’s submissions
Ms Leggett submits that none of the nine grounds of appeal are made out, that they should all be rejected and the Appeal should be dismissed.
Ms Leggett refers to the transcript of proceedings and submits that despite the dispute in the s 74 notice as to injury and incapacity, at arbitration, the issues were confined to causation and the s 11A defence.[47] Ms Leggett states that Hawkesbury argued that her psychological condition was caused by events on 9 and 10 October 2016, the events preceding those dates were not causative and the s 11A defence was limited to the events on 9 and 10 October 2016, which were reasonable actions taken by the employer with respect to discipline.
[47] T 6.21.
Ms Leggett says that her case at the arbitration was that she suffered a Major Depressive Disorder with Anxious Distress as a result of Mr Rudolph’s actions between May 2016 and 10 October 2016. At arbitration, the date of injury was amended from 9 October 2016 to 10 October 2016 without objection from Hawkesbury. Ms Leggett contends that the events on 9 and 10 October 2016 were simply the “last straw.”
Ms Leggett asserts that at the arbitration, she made submissions that the actions taken by Mr Rudolph on 9 and 10 October 2016 were not “discipline”. In the alternative, if the event of 9 October 2016 did constitute “discipline”, she submitted it was not reasonable in manner or content. Further, the request to attend a meeting was unreasonable because Ms Leggett had never previously had any performance issues and no details were given of the content of the meeting. Ms Leggett says the unreasonableness was highlighted by the fact that it was in response to Ms Leggett’s complaint about Mr Rudolph’s treatment of her.
Grounds 1–4
In respect of grounds 1–4 of the Appeal, Ms Leggett responds as follows:
(a) there was no dispute that Ms Leggett suffered a psychological injury within the meaning of s 4 of the 1987 Act. Dr Smith diagnosed a Major Depressive Disorder;[48]
(b) there was no suggestion of any non-work related other cause of her condition;
(c) the dispute on causation was limited to whether the injury was caused by only the actions on 9 and 10 October 2016 or whether it was caused by an accumulation of events between May 2016 and 10 October 2016;
(d) the Senior Arbitrator carefully considered all the evidence and his findings were logical, consistent with the weight of the evidence and were not a misapplication of the law, and
(e) the Senior Arbitrator took into account the email correspondence passing between Ms Leggett and Mr Rudolph, particularly the email of 20 July 2016 that recorded Ms Leggett was losing sleep and ruminating about the emails. Those emails lent support to the opinions of Dr Parsonage and Dr Jovanova that all of the events were causative, and supported the Senior Arbitrator’s finding that he preferred the opinions on causation expressed by Dr Parsonage and Dr Jovanova over that of Dr Smith.
[48] Reply pp 10–11.
Ms Leggett submits that Ground 4 alleges error on behalf of the Senior Arbitrator by “failing to properly consider the inadequacy of the respondent’s medical evidence.” There is no reference in the submissions to the medical evidence at all or how it was said to be inadequate.
Grounds 5–6
Ms Leggett contends that the findings referred to by Hawkesbury are all findings of fact.
As to the allegation that Hawkesbury was not given the opportunity to respond to Ms Leggett’s case, Ms Leggett maintains her submissions made in respect of the new evidence. That is:
(a) Mr Gollan’s statement was obtained after the ARD was served;
(b) no attempt was made to introduce it into evidence;
(c) there was no reason why Hawkesbury could not have gathered further evidence after it filed its Reply on 27 October 2017 (as it did with Mr Gollan), and
(d) at the telephone conference on 10 November 2017, Hawkesbury was legally represented and did not raise any issue relating to the service of the ARD, any objection to the matter proceeding, or that it required more time to prepare its case.
Ms Leggett submits that she was present at the arbitration and no application was made to cross-examine her, or to adduce further evidence from any other witness.
Ms Leggett further submits that Mr Rudolph does not deny sending the emails, speaking to Ms Leggett over the telephone on 9 October 2016, or the many actions and behaviours attributed to him. He simply has an explanation for them. She submits that they were real events.
Ms Leggett contends that the Senior Arbitrator did not make any findings adverse to Ms Porteous’ credit. On the contrary, the evidence was considered carefully and the Senior Arbitrator appears to have accepted it.[49] Further, the Senior Arbitrator did not make any other finding in relation to Mr Rudolph’s evidence other than he spoke to her in an authoritative tone, which was consistent with the evidence of Ms Porteous.
[49] Reasons, [127]–[128].
Ms Leggett submits that her perception of what transpired in that telephone call is corroborated by the email sent to Mr Rudolph in the evening after the telephone call.
Ms Leggett submits that Hawkesbury has misread the transcript when it equates the Senior Arbitrator’s statement during the Arbitration (quoted at [179(b)] above) to an articulation that if there are no real events, Ms Leggett’s case fails. Ms Leggett submits that the Senior Arbitrator was simply re-stating (so that it was clear he understood) Hawkesbury’s submission. Further the submission was clearly wrong because if Ms Leggett failed to establish the earlier events, the Senior Arbitrator was still required to determine the s 11A defence.
Ms Leggett submits that the Senior Arbitrator considered all the evidence in some detail and provided a clear and rational basis for his findings, which were open to him.
Ground 7
Ms Leggett submits that the allegation of error centres on statements made by the Senior Arbitrator at [127] and [130]. She says they are statements of common sense, are not findings and the ground of appeal is misconceived.
Ground 8
Ms Leggett submits that Hawkesbury’s submissions in respect of this ground of appeal are based on a misreading of the transcript and the ARD. The description of injury in the ARD makes it clear that Ms Leggett was relying on events occurring between May 2016 and 10 October 2016. Ms Leggett’s case was confirmed at arbitration by her legal representative, who said:
“I’m relying on anything that happened prior to then but also on what happened on the 9th and 10th.”[50]
This submission made on behalf of Ms Leggett at arbitration immediately followed the extract of the exchange between the Senior Arbitrator and Ms Leggett’s solicitor relied on by Hawkesbury at [179(b)] above.
[50] T 5.20–22.
Ms Leggett submits that that was always her case and was based on the medical evidence of Dr Jovanova. She further submits that it was open to the Senior Arbitrator to find Mr Rudolph’s conduct unreasonable and the Senior Arbitrator’s reasons disclosed no error.
Ground 9
Ms Leggett says that this ground of appeal is really several grounds, there were no submissions made in respect of the ground, or any reference to any medical evidence.
Ms Leggett maintains that the criticism of the Senior Arbitrator’s reasons and consideration of the evidence is without foundation and the Senior Arbitrator’s detailed consideration of all the evidence provided a sound basis for his findings.
Hawkesbury’s submissions in reply
Hawkesbury submits that it is convenient to initially reply with respect to Ground 7 because if the ground is determined in its favour, it would be unnecessary for the Presidential Member to determine the remaining grounds. It says that the appropriate remedy is for the matter to then be remitted to another Arbitrator for re-determination.
Hawkesbury refers to the statements made by the Arbitrator at [127] and [130] of his Reasons that the evidence of Ms Porteous and Ms Price only goes so far as to establish what they observed, not whether the alleged events occurred. It submits that the statements made by the Senior Arbitrator at [127] and [130] are not matters of common sense. Hawkesbury asserts that “the categorisation of the comments made are precisely the things which could have been the subject of submission or evidence.”[51] Hawkesbury appears to submit that the Senior Arbitrator ought not have made such comments without submissions to that effect by Ms Leggett and giving Hawkesbury the opportunity to respond. Hawkesbury submits that the Senior Arbitrator’s failure to put Hawkesbury on notice of his considerations and give it the opportunity to respond was an error of law, requiring a revocation of the determination.
[51] Submissions in Reply, [5].
Hawkesbury further submits that to the extent the determination was based on a point not raised at arbitration, it must constitute a denial of procedural fairness. It contends that the correct test to be applied is that the ground of appeal must succeed unless the error could not possibly have affected the result, citing Inghams Enterprises Pty Ltd v Belokoski[52] as an example.
[52] [2016] NSWWCCPD 31, [111]–[112].
As to Grounds 1–4, Hawkesbury responds to the suggestion by Ms Leggett that “injury” was not in issue. It submits that the s 74 notices identified “injury” was an issue and that that issue was maintained, referring to the transcript of proceedings at p 2.5 “and following.”[53]
[53] Submissions in Reply, [7].
Hawkesbury further submits that the excerpt from the transcript at [179(b)] above speaks for itself. It says that it has been accurately transcribed in its submissions. Hawkesbury makes no submissions in reply with respect to Grounds 5, 6, 8 or 9.
DISCUSSION
Grounds 1–5
The grounds of appeal are poorly drafted and the submissions made by Hawkesbury in respect of the first seven grounds are difficult to relate to any one ground of appeal. The grounds are expressed in terms of errors as to the findings of injury within the meaning of s 4 of the 1987 Act, causation of the injury, the onus of proof and the inadequacy of the medical evidence. Hawkesbury’s submissions appear to be founded on allegation of error in the Senior Arbitrator’s acceptance that real events occurred. It is said this acceptance led the Senior Arbitrator to determine erroneously that Ms Leggett’s medical case had been made out, and that her psychological injury was caused by events that occurred prior to 9 October 2016. Those earlier events were not relied on by Hawkesbury to be matters of discipline. The alleged erroneous finding that the events occurred therefore defeated the s 11A defence raised by Hawkesbury.
The Senior Arbitrator correctly identified that his first task was to determine whether the events complained of by Ms Leggett did in fact occur. In his consideration, the Senior Arbitrator noted that Mr Rudolph denied many of Ms Leggett’s allegations, but conceded that some occurred.
Mr Rudolph’s evidence[54] confirmed that he:
(a) told Ms Leggett that her arrangement to work from home was under review;
(b) advised that a written contract for her role was to be drawn up;
(c) required information from her about her budget and ongoing financial expenses;
(d) discussed with her the chocolate wheel error;
(e) needed to know how her productivity was measured, and
(f) needed to put in place a firm and clear arrangement of the parameters of her role.
[54] Reply pp 19–36.
Mr Rudolph further confirmed that:
(a) he rang Ms Leggett on 9 October 2016 and told her she did not have permission to be at the starting barriers and to return to the office;
(b) prior to that date, Ms Leggett told him she had never been to the starting barriers;
(c) he received an email complaint from Ms Leggett on the evening of 9 October 2016, and
(d) he advised her by email on 10 October 2016 she was to attend a meeting.
Mr Rudolph’s explanation for the meeting was that it was to discuss her role, her duties and her responsibilities.
He denied ever speaking to Ms Leggett in the telephone call in the manner alleged. Mr Rudolph did not deny that he had earlier given Ms Leggett permission to attend the barriers and did not deny the authenticity of the emails.
Hawkesbury submits that Mr Rudolph expressly denied the “real events”, that is that he said she earned too much money, said she was a “nothing”, questioned her integrity, placed unreasonable demands on her, harassed her about contracts and sponsorships, hung up on her and spoke to her in a rude manner.
Hawkesbury concedes that Mr Rudolph spoke to Ms Leggett in an authoritative manner in a number of conversations and in the telephone conversation on 9 October 2016. It submits that they are the only “real events” the Senior Arbitrator was entitled to find.
While I accept that Mr Rudolph disputed that he conducted himself in the manner alleged by Ms Leggett, he did not dispute the events themselves (the conversations and the emails) occurred.
The Senior Arbitrator was of the view that the emails that passed between Mr Rudolph and Ms Leggett gave significant support to the allegations made by Ms Leggett. He identified some of the words and content of the emails that he considered indicated to him that Ms Leggett’s reaction to them was unsurprising.
The emails were consistent with Ms Leggett’s account of the manner in which Mr Rudolph communicated with her. In particular, the emails of 20 July 2016 and 9 October 2016 confirmed Ms Leggett had concerns about how Mr Rudolph was treating her.
The Senior Arbitrator took into account all of the above evidence in reaching his conclusion that the events were real and not imaginary and Ms Leggett had a reaction to them. It was open to the Senior Arbitrator to make these findings of fact. Findings of fact will not normally be disturbed if they have rational support in the evidence.[55] The Senior Arbitrator provided a rational basis, supported by the evidence, for his finding and no error is established.
[55] Fox v Percy [2003] HCA 22; 214 CLR 118, 125–6.
Hawkesbury further submits that the Senior Arbitrator erred in failing to take into account the evidence of Mr Rudolph, Ms Porteous and Ms Price. It says the evidence of Mr Rudolph and Ms Porteous is unequivocal that in the telephone conversation on 9 October 2016, Mr Rudolph spoke in an authoritative manner but did not yell, demean abuse or harass Ms Leggett. Hawkesbury submits that in effect, the Senior Arbitrator has determined that Mr Rudolph and Ms Porteous lied, when there was no challenge to their credit.
The Senior Arbitrator noted in detail the evidence of the three witnesses. He did not make an adverse finding about Ms Porteous’ evidence. He determined that the evidence of Ms Porteous and Ms Price established that Mr Rudolph spoke in an authoritative manner, but otherwise only went so far as to establish that those witnesses never observed Mr Rudolph conducting himself in the manner alleged. At its best, the evidence could only establish that Mr Rudolph’s manner was not as alleged. It did not go so far as to say that the conversations and emails did not take place. As Ms Leggett submits, it is common sense that those witnesses cannot give evidence about how Mr Rudolph conducted himself when he was not in their presence.
It was incumbent on the Senior Arbitrator to consider and weigh all of the evidence, which he did. In doing so, he compared the assertions made by Mr Rudolph in his statement to the email evidence. The email evidence indicated his tone and manner were not consistent with his statement and provided a proper basis on which the Senior Arbitrator formed the view that he preferred Ms Leggett’s version of events.
Hawkesbury contends that the pleadings allege a date of injury of 9 October 2016. It submits that Ms Leggett did not plead a “nature and conditions” claim and if Ms Leggett fails to establish the event on 9 October 2016, then her claim fails in its entirety. The point of this submission is unclear. The date of injury was discussed at the arbitration to be up to and including 10 October 2016.[56] The pleadings describe the injury as “bullying, harassment and unfair treatment by Mr Greg Rudolph progressively eroding her psychological condition from mid 2016 to 9 October 2016.”[57] The description of injury also included the specific dates of 9 and 10 October 2016. The matter proceeded on that basis and it was the task of the Senior Arbitrator to determine whether there were real events that occurred over the whole period of the claim, and if so, whether they were causative of injury. He was satisfied there were real events and that the weight of the medical evidence supported the causal connection between those events and the injury.
[56] T 5.19–24.
[57] ARD Part 4 — Injury Details.
Hawkesbury submits that the “erroneous” findings of real events have extended to acceptance of Ms Leggett’s medical evidence. It says that in the absence of these real events, her medical case fails and the finding of psychological injury must fail. The Senior Arbitrator did not fall into error in determining there were real events that occurred over the period pleaded. Those events formed the basis of the medical opinions of Dr Parsonage and Dr Jovanova. It was open to the Senior Arbitrator to accept those medical opinions once it was established that the events occurred.
Hawkesbury alleges the Senior Arbitrator erred in respect of his findings in relation to injury, substantial contributing factor and causation. It is alleged he “failed to consider the inadequacy of [Ms Leggett’s] medical evidence.”
At arbitration, Hawkesbury flagged that s 4 of the 1987 Act (injury) was in issue, but appropriately made no submissions that Ms Leggett’s psychological condition did not constitute an injury within the meaning of s 4. There was a consensus of opinion in the medical evidence that Ms Leggett suffered a psychological injury as a consequence of her employment. The disparity in the opinion was that (contrary to the opinions of Dr Parsonage and Dr Jovanova) Dr Smith was of the view that events that pre-dated 9 October 2016 were not causative. He opined that the injury resulted from the telephone call on 9 October 2016 and the email from Mr Rudolph that followed. Hawkesbury’s case was that the earlier events were not real events and the two events on 9 and 10 October 2016 were causative and constituted reasonable action taken by the employer with respect to discipline. As the Senior Arbitrator observed, there was no evidence that there were any external factors that caused or contributed to her condition. Given the medical evidence available, the submission made at arbitration by Hawkesbury was the only evidence based submission that could properly be made by it.
The Senior Arbitrator did not accept that proposition. He rejected it after a consideration of all of the factual and medical evidence. His reasons disclose no error and the finding was open to him. Grounds 1–5 fail.
Ground 6: Error in finding Ms Leggett’s perception of events was sufficient to characterise the events as bullying and harassment
Hawkesbury says that the Senior Arbitrator misdirected himself as to the proper application of Chemler and “associated authorities” and determined the issue of “perception” without first having established that real events occurred. Hawkesbury’s submissions on this ground contradict its earlier submission that there was error in the Senior Arbitrator’s acceptance that real events occurred, which led to determine erroneously that:
(a) Ms Leggett’s medical case had been made out, and
(b) there was a causal connection between her psychological injury and the events that occurred prior to 9 October 2016.
Hawkesbury submits that the weight of the evidence (from Mr Rudolph, Ms Porteous and Ms Price) did not support a finding that there was any behaviour that would justify a finding of bullying and harassment at any stage.
The Senior Arbitrator correctly identified that his first task was to consider whether the events relied on by Ms Leggett occurred. I have earlier referred to the steps the Senior Arbitrator took to evaluate the evidence relevant to establish that the events happened. The Senior Arbitrator determined that he was satisfied that the events alleged by Ms Leggett did occur and were real, rather than imaginary, applying Attorney General’s Department v K. He reasoned:
(a) Ms Leggett had issues with Mr Rudolph’s management style from the time he became CEO;
(b) she viewed her interactions with him as bullying and harassment, and
(c) he had no reasons to doubt her evidence or her perception of those real events.
In Chemler, Basten JA noted:
“If conduct which actually occurred in the workplace was perceived as creating an offensive or hostile working environment, and a cognizable injury followed, it was open to the Commission to conclude that causation was established. Accordingly, no error in point of law was identified by this ground.”[58]
[58] Chemler, [69].
Acting President Roche said in Attorney General’s Department v K:
“The critical question is whether the event or events complained of occurred in the workplace. If they did occur in the workplace and the worker perceived them as creating an ‘offensive or hostile working environment’, and a psychological injury has resulted, it is open to find that causation is established. A worker’s reaction to the events will always be subjective and will depend upon his or her personality and circumstances. It is not necessary to establish that the worker’s response was ‘rational, reasonable and proportional’.”[59]
He further added:
“Though the worker’s reference to ‘bullying and harassment’ may be seen, on one view, as an overstatement, the worker’s perception was that she had been unfairly treated at work over work matters. It is indisputable that she based that perception upon real events that happened at work.
As the above authorities demonstrate, the Arbitrator did not have to consider if the worker’s perception was erroneous or irrational. He had to determine if the events complained of actually occurred and, if they did occur, whether the worker’s injury resulted from them. He therefore did not err in disregarding the labels the worker attached to the circumstances that gave rise to her injury.”[60]
[59] Attorney General’s Department v K, [54].
[60] Attorney General’s Department v K, [57]–[58].
The reasoning process of the Senior Arbitrator is consistent with the principles enunciated in Chemler and in Attorney General’s Department v K and does not disclose error. Ground 6 of the Appeal fails.
Ground 7: The Senior Arbitrator erred in law in determining the matter on a basis not put by or to the parties
Hawkesbury alleges that it has been denied procedural fairness by not having the opportunity to submit in respect of the Senior Arbitrator’s conclusion that Ms Porteous and Ms Price could only give evidence about how Mr Rudolph conducted himself when he was in their presence. Hawkesbury relies on Ghaleb.
Ghaleb is authority for the general principle that if the judge contemplates determining the case on a basis which is different to the basis upon which the parties conducted the trial, the judge must inform the parties so that they have an opportunity to address any new or changed issues that may arise. A failure to do so will ordinarily result in a denial of procedural fairness.[61]
[61] Ghaleb, [78]–[79].
The Senior Arbitrator’s observation as to the extent of the evidence from Ms Porteous and Ms Price was simply a common sense explanation as to why the evidence was of limited assistance. Procedural fairness does not require a decision maker to give a running commentary on what he or she thinks about the evidence that is given.[62] There is no obligation on the decision maker to invite comment on the evaluation of the evidence in a case.[63]
[62] SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63; 228 CLR 152; 231 ALR 592, [48].
[63] Commissioner for the Australia Capital Territory Revenue v Alphaone Pty Ltd [1994] FCA 1074; 49 FCR 576, 591–592.
It is Hawkesbury’s responsibility to adduce evidence to answer the allegations made against it. It has not been denied procedural fairness in respect of the Arbitrator’s evaluation of the evidence of Ms Porteous and Ms Price. Ground 7 of the Appeal fails.
Ground 8: The Senior Arbitrator erred by dismissing Hawkesbury’s defence under s 11A of the 1987 Act
Hawkesbury alleges the Senior Arbitrator erred by:
(a) misapplying the test for s 11A;
(b) failing to find the injury was wholly or predominantly caused by reasonable action taken by the respondent with respect to discipline, and
(c) having regard to events prior to 9 October 2016 (the pleaded date of injury).
Hawkesbury submits that the Senior Arbitrator intervened in submissions which resulted in a reconstruction of the pleadings, which alleged the injury occurred on 9 and 10 October 2016. The passage of the transcript relied upon is recorded as follows:
“Arbitrator: Your primary case is that all of the events leading up to 10 October 2016 were the whole and predominant cause. Well, they caused the injury and the events on the 9th and 10th were not wholly or predominantly caused by reasonable action.
Mr Gilbert: I just don’t — well, I find his — I’m not sure — — —
Arbitrator: So [Dr Smith is] focusing on those last two events and I think that’s what you’re trying to say. He’s focusing on those last two events and not — pushing to the side whatever history the applicant’s been dealing with.”[64]
[64] T 33.6–19.
The Arbitrator’s summation of Ms Leggett’s case is consistent with the pleadings in Part 4 of the ARD, referred to at [224] above. The Senior Arbitrator did not “interfere with” the pleadings or the presentation of Ms Leggett’s case. He simply clarified both Ms Leggett’s case and the thrust of Dr Smith’s opinion. Both parties proceeded to make submissions in the arbitration that accorded with the Senior Arbitrator’s summation.
Hawkesbury further refers to the transcript where the Arbitrator observed:
“Sorry, if you don’t accept the allegations of bullying and harassment prior to 9th and 10th the applicant should fail.”[65]
[65] T 7.32–35.
Hawkesbury says that if the proper construction of the ARD had not been interfered with, the Arbitrator would have no choice but to apply s 11A as there were no real events properly pleaded which were outside of the parameters of s 11A. Hawkesbury submits that the above observation by the Senior Arbitrator is an articulation of that eventuality.
It is no such articulation. The remark was made by the Arbitrator to Hawkesbury’s counsel who was at the time making the submission that Ms Leggett’s claim would fail if she did not establish bullying and harassment occurred. The Arbitrator was simply clarifying the submission. Hawkesbury’s appeal ground asserts the matter ought to have proceeded and been determined on the basis of only the events of 9 and 10 October 2016. That is not consistent with a proper reading of the pleadings, nor is it consistent with the case Hawkesbury was required to meet or the manner in which the case was conducted at arbitration.
Hawkesbury refers to the Senior Arbitrator’s Reasons at [184] and submits that Mr Rudolph denied giving Ms Leggett permission to attend the barriers and so the Senior Arbitrator erred in determining that the manner in which Mr Rudolph requested Ms Leggett return was not reasonable. The passage from the Arbitrator’s Reasons is as follows:
“It may well have been appropriate for Mr Rudolph to ask the applicant to come back from the barriers, but the manner in which he did so was not reasonable in the context of having previously given her permission.”
Ms Leggett alleged she was given permission to attend the barriers. Mr Rudolph’s evidence is silent as to whether he did or did not give that permission. He merely recalled there has been a discussion about her not having been to the barriers. Without Mr Rudolph denying she was given permission, it was open to the Arbitrator to conclude that she was.
Hawkesbury contends that Ms Leggett did not seek an extension of time to attend the meeting and so notice within 24 hours was reasonable.
In its submissions, Hawkesbury did not challenge the Senior Arbitrator’s finding (based on Mr Rudolph’s evidence as to the purpose of the meeting) that the meeting did not constitute “discipline.” The Senior Arbitrator referred to the principles laid down in Irwin, Heggie and Sinclair in his consideration of the aspect of “reasonableness”. He determined that it would have been appropriate for Mr Rudolph to advise Ms Leggett that it was not a disciplinary meeting, and give her more details as to what was to be discussed. He had no doubt Ms Leggett would be concerned on reading the email. The short notice of the meeting was only one factor in the classification of Mr Rudolph’s conduct as unreasonable. Hawkesbury has not made submissions as to why the remaining factors were not unreasonable.
I might add that it was somewhat unusual that Mr Rudolph either ignored the fact that Ms Leggett had issues with his conduct or chose to respond to it by arranging a meeting to discuss her role. It appears no attempt was made by Mr Rudolph to appropriately refer it to an independent party to deal with the complaint.
In the unreported decision of Irwin, Geraghty CCJ stated:
“The question of reasonableness is one of fact, weighing all the relevant factors. The test is less demanding than the test of necessity, but more demanding that a test of convenience. The test of ‘reasonableness’ is objective and must weigh the rights of the employees against the objective of the employer. Whether an action is reasonable should be attended, in all the circumstances by questions of fairness.”
That passage has been frequently referred to and endorsed in decisions of the Commission and in the Court of Appeal. The Senior Arbitrator referred to it in his Reasons. He also referred to Heggie and Sinclair as authority for the proposition that in a consideration of what is reasonable, it is important to have regard to not only the end result, but to the manner in which it is effected.
The Senior Arbitrator’s finding that the actions were unreasonable were soundly based and in accordance with the applicable principles. No error has been demonstrated and Ground 8 of the Appeal fails.
Ground 9: The Senior Arbitrator erred by:
(a) failing to give adequate reasons;
(b) failing to properly consider and evaluate the evidence;
(c) accepting and preferring Ms Leggett’s medical evidence, and
(d) failing to assess and properly take into account Mr Rudolph’s credit.
Hawkesbury makes no submissions in respect of this ground of appeal and relies on its submissions generally made in respect of the other eight grounds of appeal. I have dealt with all of the submissions made and none of them were persuasive of error on the part of the Senior Arbitrator. It is not necessary and I do not intend to repeat my discussions of the submissions. The Senior Arbitrator extensively examined the evidence and gave sufficient reasons for finding that Ms Leggett suffered a compensable psychological injury that was not wholly or predominantly caused by reasonable action by the employer with respect to discipline.
Further the Senior Arbitrator’s conclusion that the employer’s actions on 9 and 10 October 2016 were unreasonable was soundly based and disclosed no error. Ground 9 of the Appeal fails.
An appeal pursuant to s 352(5) is limited to the identification of error of fact, law or discretion. Hawkesbury have not established error and the Appeal fails.
DECISION
The application to admit new evidence is refused.
The Certificate of Determination dated 7 December 2017 is confirmed.
Elizabeth Wood
Deputy President
6 June 2018
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