Lloyd v Healthscope Operations Pty Ltd
[2021] VSCA 327
•30 November 2021
SUPREME COURT OF VICTORIA
COURT OF APPEAL
S EAPCI 2021 0018
| LINDA PATRICIA LLOYD | Applicant |
| v | |
| HEALTHSCOPE OPERATIONS PTY LTD | Respondent |
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| JUDGES: | BEACH, OSBORN JJA and FORBES AJA |
| WHERE HELD: | MELBOURNE |
| DATE OF HEARING: | 8 November 2021 |
| DATE OF JUDGMENT: | 30 November 2021 |
| MEDIUM NEUTRAL CITATION: | [2021] VSCA 327 |
| JUDGMENT APPEALED FROM: | [2020] VCC 2032 (Judge P Ginnane) |
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NEGLIGENCE – Workplace injury – Psychiatric injury – Alleged bullying – Disciplinary proceedings – Whether trial judge erred in not being satisfied that bullying occurred – Whether employer on notice of work-related risk to plaintiff’s mental health – Whether employer breached duty of care in investigation and handling of complaints – Whether trial judge’s reasons adequate – Application for leave to appeal refused.
CONTRACT – Whether employer’s disciplinary procedure manual was incorporated into employee’s contract of employment – Whether parties objectively intended disciplinary procedure manual to form part of contract of employment – Whether parties objectively intended relevant parts of disciplinary procedure manual to have contractual effect – Whether damage claimed too remote – Whether trial judge’s reasons adequate – Application for leave to appeal refused.
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| APPEARANCES: | Counsel | Solicitors |
| For the Applicant | Mr A D B Ingram QC with Mr G A Worth | Maurice Blackburn |
| For the Respondent | Mr P M O’Grady QC with Mr S E Gladman | Wisewould Mahony |
BEACH JA
OSBORN JA
FORBES AJA:
Between 1982 and 2012, Linda Patricia Lloyd (‘the plaintiff’) was employed by Healthscope Operations Pty Ltd (‘the defendant’) as a receptionist and patient services provider at the Melbourne Clinic. The Melbourne Clinic is a private mental health service, which provides both inpatient and outpatient treatment in respect of people suffering from psychiatric conditions.
In the proceeding at first instance, the plaintiff claimed that, over a relatively short period of time during 2012, she was bullied by the defendant’s finance manager, Trent Stewart. The plaintiff also claimed that the defendant owed her a duty of care in undertaking and managing investigations conducted on its behalf by Mr Stewart in response to a number of workplace related allegations made against her; which duty was breached by the defendant, causing the plaintiff to suffer psychiatric injuries. Additionally, the plaintiff claimed that the psychiatric injuries she sustained were caused by a breach by the defendant of her contract of employment, which contract she claimed entitled her to the benefit of a number of policies implemented by the defendant, including policies as to how disciplinary matters involving employees would be investigated and determined by the defendant.
On 17 December 2020, following a trial conducted in the County Court over six days in February and March 2020, a judge of the County Court dismissed the plaintiff’s proceeding and gave judgment for the defendant, in accordance with reasons published on 16 December 2020.[1] In summary, the judge:
·was not satisfied that the plaintiff was bullied by Mr Stewart;[2]
·rejected the plaintiff’s claim of breach of duty (negligence) on the part of the defendant, concluding that the defendant did not owe the plaintiff the duty of care alleged by her;[3]
·held that in any event there was no breach of any duty by the defendant;[4] and
·rejected the plaintiff’s breach of contract claim holding, among other things, that the policy documents relied upon by the plaintiff were not contractual,[5] and that the damage claimed and/or suffered by the plaintiff was too remote.[6]
[1]Lloyd v Healthscope Operations Pty Ltd [2020] VCC 2032 (‘Reasons’).
[2]Ibid [196].
[3]Ibid [286].
[4]Ibid [287], [290], [293].
[5]Ibid [355], [376], [387], [435]–[436].
[6]Ibid [419]–[428].
The plaintiff now seeks leave to appeal on three proposed grounds. In summary, the plaintiff contends that the judge:
·erred in failing to conclude that the plaintiff was bullied by Mr Stewart; alternatively, failed to provide adequate reasons for not being so satisfied (proposed ground 1);
·erred in failing to conclude that the defendant was negligent in its handling of complaints about the plaintiff, and the subsequent investigations and determination of those complaints; alternatively, failed to provide adequate reasons for rejecting the plaintiff’s claim in negligence (proposed ground 2); and
·erred in failing to accept the plaintiff’s breach of contract claim (specifically that the judge erred in failing to accept that policy documents relied upon by the plaintiff, in particular the disciplinary policy had contractual force, and in finding that the plaintiff’s damage was too remote); alternatively, failed to provide adequate reasons for not accepting the plaintiff’s breach of contract claim (proposed ground 3).
Background facts
The events giving rise to this proceeding took place between January and June 2012. At the time, the plaintiff, who was then aged 57, was the longest serving of the defendant’s employees. She worked as a permanent part-time receptionist for 38 hours per fortnight.
In October 1999, the plaintiff and the defendant entered into a written contract of employment.[7] The contract provided that the plaintiff was employed in the position of ‘receptionist/clerk’. By cl 5 of the contract, the plaintiff agreed that ‘the duties and responsibilities contained in [an attached job description] represent the duties and responsibilities of the Employee for the term of this Contract‘.
[7]Dated 6 October 1999.
Clauses 13 and 14 of the contract (which are specifically relevant to proposed ground 3) provided:
13. Occupational Health & Safety
The Employee shall follow safe work practices and comply with the Hospital’s occupational health & safety policies and procedures including compulsory inservice attendances for Aggression Management and Fire Drill once per annum.
14. Hospital Policies and By-Laws
The Employee shall be employed subject to the policies and by-laws of the Hospital as amended from time to time.
In April 2011, changes were made in the terms of the plaintiff’s employment. Those changes were embodied in a letter (‘the Change in Terms Letter’) headed ‘Change in Terms of Employment Letter’, and dated 13 April 2011, which attached a ‘Change in Employment Status and Remuneration Form’. It is not necessary for present purposes to identify the various changes that letter made in the terms of the plaintiff’s employment. What is material is that the Change in Terms Letter provided:
This Agreement constitutes the entire Agreement of the parties about the subject matter and any previous Agreements, understandings and negotiations on that subject matter cease to have any effect. All other conditions of employment remain unaltered.[8]
[8]Emphasis added.
On 16 January 2012, the plaintiff was working alone on the reception desk at the Melbourne Clinic when she had an interaction with a patient (‘the first patient’). Subsequently, on 21 January 2012, the first patient made a complaint that the plaintiff was ‘unhelpful, rude, condescending and is a dangerous employee in such an environment’.
As part of his duties as the defendant’s Finance Manager, Mr Stewart dealt with complaints made about staff. From the evidence, it appears that the first patient’s complaint came to his attention on or before 23 January 2012. On 30 January 2012, and unbeknown to the plaintiff, Mr Stewart sent an email to the Payroll Officer, Mathew Eades, requesting ‘a sick leave report, indicating any sick leave taken by [the plaintiff], detailing the dates of sick leave taken over the last couple of years if possible’.
On the following day (and again unknown to the plaintiff) Mr Stewart prepared a letter (‘the draft letter’) for sending to the plaintiff. While the draft letter was never sent, the preparation of it by Mr Stewart formed part of the plaintiff’s allegations of bullying at trial. In the circumstances, it is necessary to set out the contents of the draft letter. The draft letter provided:
Dear Linda,
Re: Unprofessional Behaviour
It has been brought to my attention that you behaved in an unprofessional manner to a patient on Monday, 16th January, 2012.
The patient in question, has advised you were:
·Unhelpful
·Rude
·Condescending
She has also advised that she is considering taking the matter to the ombudsman, and is well aware of the processes as she works in health.
As a result of this, I would like to meet with you on Tuesday February 7th at 3.30 pm in my office. The purpose of this meeting is for you to provide a response to the above mentioned allegations.
You may be represented by or have a witness of your choosing present at this meeting. Kiri Hennessy, Operations Manager will also be present at this meeting.
Subject to the matter above, you are not to approach or discuss this with any employee of the organisation prior to the meeting.
Please confirm your attendance at this meeting with Amy Li on [telephone number].
Yours sincerely
Trent Stewart
Finance Manager
On 29 February 2012, Mr Stewart sent the plaintiff a letter (‘the first letter’). The plaintiff gave evidence that Mr Stewart gave her the first letter by simply throwing it on her desk and then walking away from her. She said that, when she asked him what it was, he said, in a smug tone, ‘Open it, you’ll see’. The first letter was similar to the draft letter, but contained two extra paragraphs relating to the plaintiff’s taking of breaks and her use of sick leave. The first letter provided:
Dear Linda,
Re: Unprofessional Behaviour
It has been brought to my attention that you behaved in an unprofessional manner to a patient on Monday, 16th January, 2012.
The patient in question, has made allegations that you were:
·Unhelpful
·Rude
·Condescending
She has also advised that she is considering taking the matter to the ombudsman, and is well aware of the processes as she works within the health system.
Further to this it has been brought to my attention that you are taking leave breaks before starting on reception, in excess of the 15 minutes you are allocated.
Finally, we also have some concerns in relation to your sick leave after the long weekend, and how you new (scil, knew) that you would be sick for 2 days on the Monday.
As a result of these issues, I would like to meet with you on at 10am on Thursday 8 March, 2012 in my office. The purpose of this meeting is for you to provide a response to the above mentioned allegations.
You may be represented by or have a witness of your choosing present at this meeting. Kiri Hennessy, Operations Manager will also be present at this meeting.
Subject to the matter above, you are not to approach or discuss this with any employee of the organisation prior to the meeting.
Please confirm your attendance at this meeting with Amy Li on [telephone number].
Yours sincerely
Trent Stewart
Finance Manager
While the first letter requested a meeting on 8 March 2012, the meeting contemplated actually took place on 26 March 2012. Present at the meeting were the applicant, Mr Stewart and Kiri Hennessy, the defendant’s Operations Manager.
On 13 May 2012, the plaintiff was involved in another altercation with a patient (‘the second patient’). The plaintiff sent an email that day, reporting that the second patient had questioned her as to why she would not let the second patient’s visitors stay when other visitors were allowed to visit. The plaintiff reported that she suffered ‘a barrage of abuse, being called a f--- wit, bitch etc’. The second patient also made a complaint about the plaintiff’s behaviour.
On 15 May 2012, Mr Stewart sent the plaintiff a letter headed ‘First Written Warning’ (‘the FWWL’). The FWWL provided:
Dear Linda,
Re: First Written Warning
We refer to our counselling session held on 26th March 2012 in relation to allegations that you were:
·Unhelpful
·Rude
·Condescending
As a result of our counselling session on 26th March 2012 we agreed that this behaviour was unacceptable and that patients coming into our hospital were required to be treated with patience and understanding.
It has since been brought to my attention that you behaved in an unprofessional manner to a patient on 13 May 2012 where you degraded her called her ‘crazy’.
She has acknowledged that she swore, initially at the situation and then at you following the comment.
Whilst we do not condone the patients’ behaviour, it is expected that you will treat patients carefully, calmly and with respect at all times.
As a result of these issues, I would like to meet with you at 11am on Monday 4 June 2012 in Fiona Langley’s office. The purpose of this meeting is for you to provide a response to the above mentioned allegations.
Your behaviour towards patients will be closely monitored and reviewed. If there continues to be a consistent pattern of behaviour further disciplinary action may be taken.
You may be represented by or have a witness of your choosing present at this meeting. Fiona Langley, Director Of Nursing will also be present at this meeting.
Subject to the matter above, you are not to approach or discuss this with any employee of the organisation prior to the meeting.
Please confirm your attendance at this meeting with Amy Li on [telephone number].
Yours sincerely
Trent Stewart
Finance Manager
The FWWL required the plaintiff to attend a further meeting, scheduled for 4 June 2012. On 4 June 2012, however, the plaintiff was away from work on sick leave. On 7 June 2012, Mr Stewart sent the plaintiff a further letter (‘the further letter’). The further letter provided:
Dear Linda,
Re: Issue in relation to work behaviour
We refer to prior letter dated May 15, 2012 and the subsequent meeting which you did not attend, and did not advice (sic) of non attendance until after the meeting was due to commence.
As a result of non-attendance at the meeting previously set for Monday 4 June, 2012 at 11 am, a second meeting has been scheduled for Thursday 21st June, 2012 at 10am.
Failure to attend this meeting will result in the Executive management of The Melbourne Clinic arriving at a decision without your input and version of events to mitigate the final decision.
You may be represented by or have a witness of your choosing present at this meeting. Fiona Langley, Director Of Nursing will also be present at this meeting.
Subject to the matter above, you are not to approach or discuss this with any employee of the organisation prior to the meeting.
Please confirm your attendance at this meeting with Amy Li on [telephone number].
Yours sincerely
Trent Stewart
Finance Manager
On 18 June 2012, the plaintiff raised with her direct supervisor (Vicki Tonkin) her concern about the manner in which she had been treated by Mr Stewart. That same day, after speaking with Ms Tonkin, the plaintiff met with the defendant’s General Manager (Andrew McKenzie). During that meeting (which, at the plaintiff’s request, Ms Tonkin attended to support the plaintiff) the plaintiff expressed her concerns to Mr McKenzie about the manner in which she had been treated by Mr Stewart. Following that meeting, the plaintiff continued in her employment until she ceased work on 24 June 2012. On or about 3 July 2012, the plaintiff lodged a WorkCover claim. The plaintiff has not worked since.
On 6 July 2012, accompanied by her husband, the plaintiff had a meeting with Mr McKenzie and Charlaine Havlin, another employee of the defendant. On 9 July 2012, Mr McKenzie wrote to the plaintiff regarding the FWWL and the further letter as follows:
Dear Linda,
I am writing to you following our meetings on June 18th and July 6th and will respond to each separately. Before I do, I would like to apologise again to you for the distress that this situation has caused to you.
June 18th meeting with Vicki Tonkin and myself.
You contacted me requesting a meeting to discuss letters that you had received from the Finance Manager.
I reviewed these letters with you at this meeting (I had not seen the letters previously) and found the following:
·The first of the letter was requesting a meeting with you to discuss a complaint that a patient had made about you. I found that this letter was not compliant with Healthscope Performance Management Policy. The letter should have been advising you that a complaint had been received and asking to meet with you rather than stating in the title ‘first written warning’.
·The second letter had been sent requesting another meeting as you failed to attend the first meeting. This letter should not have been sent (or been retracted) when you advised your manager of your illness and subsequently produced a medical certificate.
I advised you that both these letters were now retracted and that there would be no further followup. I apologised to you for the distress that they had caused.
July 6th meeting with Charlaine Havlin and myself.
I requested a meeting after receiving a certificate of capacity from you.
At this meeting you advised me that you were anxious, stressed and not sleeping for the following reasons:
·Since receiving the letters from the Finance Manager
·Increased work load with lack of support.
I apologised again to you that the letters had not complied with the Healthscope policy and that they had been mailed to you in that format. I also apologised that these letters had been sent to you without my first reviewing them. The Finance Manager has been councelled (sic) regarding the importance of following policies and procedures. I reiterated that the letters to you dated May 15th and June 7th 2012 had been retracted.
You advised me that you had felt stressed working at reception due to increased work load. You advised me that you had raised this with Vicki Tonkin the Patient Services Manager. Vicki is currently on leave therefore I will follow this up with her on her return. I advised you that I was very happy to review your current position description with you and Vicki which you declined until you were feeling better.
The outcome of this meeting was:
1. Workcover claim to be submitted
2.To remain off sick leave until claim processed or until you commence annual and long service leave.
3. Charlaine to call Linda next week.
I wish to again express my sincere apologies for the distress that this incident has caused to you.
Yours sincerely
Andrew McKenzie
General Manager
The plaintiff’s allegations of bullying at trial
The plaintiff gave evidence at trial that she believed that Mr Stewart was targeting her. When asked for the basis of this belief, she said:
Just his attitude when he’s walked into the clinic, and just stares at me. And never says anything. I just believe that he didn’t want me there. … I don’t know why I had that belief, but I just had that feeling that I was being targeted from him. He wasn’t looking into anybody else at the reception area and how they were working and what was happening at reception. It just seemed to be only me.
At trial, the plaintiff referred to the defendant’s definition of bullying in the defendant’s Corporate Policy and Procedure manual (‘the Workplace Bullying Procedure document’). That definition was, in terms:
Workplace bullying is repeated, unreasonable behaviour directed toward an employee or group of employees that creates a risk to health and safety. Unreasonable behaviour means behaviour that a reasonable person having regard to all the circumstances would expect to victimise, humiliate, undermine or threaten. Behaviour can include an individual’s or group’s actions or practices that victimise, humiliate, undermine or threaten.
At trial, and by reference to the decisions of Swan v Monash Law Book Cooperative,[9] Brown v Maurice Blackburn Cashman[10] and Johnson v Box Hill Institute of TAFE,[11] the plaintiff contended that the issue of bullying raised two threshold questions:
(1)Was there unreasonable behaviour directed towards the plaintiff, ie behaviour that a reasonable person having regard to all of the circumstances would expect to victimise, humiliate, undermine or threaten the plaintiff; and
(2)If there was, did it occur repeatedly?
[9][2013] VSC 326 (‘Swan’).
[10](2013) 45 VR 22 (‘Brown’).
[11][2014] VSC 626 (‘Johnson’). See also Box Hill Institute of TAFE v Johnson [2015] VSCA 245, in which leave to appeal and leave to cross-appeal was refused.
In final submissions to the trial judge, the plaintiff referred to the following matters as ‘comprising frank bullying by Mr Stewart’:
·Mr Stewart’s walking into the reception at the Melbourne Clinic and ‘just staring at the plaintiff without saying anything; and glaring at her as he walked past reception’;
·Mr Stewart’s failure to undertake any real investigation into the first patient’s complaint;
·Mr Stewart’s actively searching for reasons to discipline the plaintiff in the period 21 January 2012 to 29 February 2012 (as demonstrated by his email to Mr Eades and his preparation of the first letter expanding on the draft letter);
·the manner in which Mr Stewart delivered the first letter to the plaintiff;
·Mr Stewart sending the first letter, the FWWL and the further letter, all of which were, in their terms, unreasonable; and all of which, in context, were unreasonable;
·conducting a ‘counselling session’ during the meeting on 26 March 2012, with no prior warning to the plaintiff that it was to be a counselling session, and with no prior warning as to the manner in which it was to be conducted;
·failing to ‘provide the plaintiff with any clear outcome of or follow up’ from the ‘counselling session’ conducted during the 26 March meeting; and
·failing to properly investigate the second patient’s complaint, and the plaintiff’s complaint in relation to her dealing with the second patient.
Bullying: the judge’s reasons
The critical witnesses at trial in relation to the issue of bullying were the plaintiff and Mr Stewart.
The judge found the plaintiff to be a witness ‘who did her best to give an account of herself and her circumstances’.[12] The judge referred to the plaintiff as exhibiting a strong sense of injustice at the manner in which she believed she had been treated. He said that he was satisfied that, at times, her description of her dealings with Mr Stewart were ‘somewhat exaggerated and, most probably, have developed through the long lens of litigation hindsight’.[13] The judge then said that, while he had rejected parts of the plaintiff’s evidence, there were other parts that he had accepted.
[12]Reasons [50].
[13]Ibid. The judge’s reference to ‘litigation hindsight’ was plainly a reference to the cognate expression ‘litigious hindsight’ used by Keane JA in Hegarty v Queensland Ambulance Service [2007] QCA 366, [47] (‘Hegarty’).
With respect to the plaintiff’s interpretation of Mr Stewart’s behaviour and her characterisation of it as bullying, the judge said:
I am not satisfied of the plaintiff’s characterisation of Stewart’s conduct as bullying that rely on her interpretations of his behaviour, and consist of his failure to acknowledge her when walking past her at reception, or of an expression of apparent smugness she claimed he exhibited towards her. I have dismissed these attitudinal impressions not because, in an appropriate case, if proved, such behaviour by way of expressions of apparent attitude need be, or should be dismissed as trivial, but instead, because I am satisfied that they are too remote and subjective and instinctual as to admit by me of a positive finding of fact that they occurred. I am satisfied that the plaintiff did not warm to Stewart and saw him in the manner she gave to Dr Brendan Hayman, psychiatrist, that is, a ‘young macho guy’ and someone whom she thought saw her as old and expensive to retain employed, as opposed to a younger and more ‘casualised’ workforce. She also explained that they had very few interactions as his office was not on site but down the road from the Melbourne Clinic and when he did come in he would gravitate to where all the young girls were.[14]
[14]Reasons [53] (footnotes omitted).
Noting that by the time of trial, Mr Stewart was no longer employed by the defendant, the judge described him as a witness who appeared to give evidence on behalf of the defendant reluctantly.[15] The judge described Mr Stewart as ‘unimpressive’.[16] His Honour noted that Mr Stewart was able to provide ‘only the barest of specific recollection of the matters involving the plaintiff’.[17]
[15]Ibid [54]–[55].
[16]Ibid [54].
[17]Ibid.
The judge noted that Mr Stewart gave evidence that he was familiar with that part of the defendant’s Corporate Policy and Procedures manual dealing with disciplinary procedures (‘the Disciplinary Procedures document’). The judge, however, doubted that Mr Stewart was familiar with the document, and then said:
Overall, and based on my review and assessment of Stewart’s evidence, I am satisfied that it is more probable than not, in managing the issues that arose in connection with the plaintiff, not only is it unlikely that he had regard to the Disciplinary Procedures policy, but that he also went about his interactions with the plaintiff with a lack of interpersonal management skill and, it was as much this, as opposed to non-compliance with prescriptive measures contained in policies, that created the setting and was the cause of the plaintiff’s injury.[18]
[18]Ibid [57].
The judge accepted that, upon the receipt of the first patient’s complaint, a form of investigation was warranted.[19] With respect to Mr Stewart’s conduct between the time he became aware of the first patient’s complaint and the sending of the first letter, the judge noted Mr Stewart’s lack of memory of the relevant events.
[19]Ibid [69].
Turning to the first letter, the judge observed that its title ‘conveyed an air of prejudgement’,[20] and said that its first sentence was ‘poorly expressed and … convey[ed] predetermination’.[21] The judge described the first letter as ‘a very unsatisfactory exercise in employee communication’.[22] However, the judge rejected the plaintiff’s contentions that it was wrong of Mr Stewart to have given the letter to her while she was at work, and wrong of him not to have spoken to her before giving her the letter.[23]
[20]Ibid [84].
[21]Ibid [85].
[22]Ibid [87].
[23]Ibid [89].
The judge was critical of the first letter for its lack of particularity with regard to the allegations made in it.[24]
[24]Ibid [92], [97].
In relation to the 26 March 2012 meeting, the judge said that he was not convinced that any of the participants (the plaintiff, Mr Stewart or Ms Hennessy) had a reliable recollection of what occurred during the course of it.[25]
[25]Ibid [109].
The judge referred to the plaintiff’s evidence that she was not provided with particulars of the occasions on when she had taken longer breaks, and her evidence that she thought she was being accused of cheating on her time sheets. The judge said that the plaintiff’s belief that she was being accused of cheating was a reasonable one. He said, however, that he did not find that Mr Stewart actually accused her of cheating.[26]
[26]Ibid [114].
With reference to the plaintiff taking sick leave after a long weekend, the judge noted the plaintiff’s evidence that there had been a public holiday on a Thursday (Australia Day), the plaintiff was not rostered on the Friday, Saturday or Sunday, and on the Monday (when she took the relevant leave) she was at the funeral for a young boy.[27] The judge then referred to the plaintiff’s evidence that, when she was questioned about this, she was ‘very emotional with it all’.[28]
[27]Ibid [116].
[28]Ibid [117].
The judge noted the plaintiff’s evidence that she was provided with an opportunity during the 26 March 2012 meeting to respond to the allegations made in the first letter.[29] After referring to further evidence given in relation to that meeting the judge then said that because he was satisfied that the meeting ‘better accord[ed] with counselling’ rather than a disciplinary meeting, documentation of the outcome of the meeting was not necessarily warranted, except in relation to the issue of the plaintiff’s breaks.[30] The judge, however, went on to say that it might have been preferable for Mr Stewart to have recorded the matters discussed in the meeting, and for the plaintiff to have been provided with a record of the discussion.[31]
[29]Ibid [116]–[117].
[30]Ibid [133].
[31]Ibid.
Having analysed the evidence concerning the 26 March 2012 meeting, the judge concluded that there was no bullying involved.[32] He was also satisfied that the ‘upset’ that the plaintiff exhibited fell within the range of what might be expected when an employee’s conduct had been called into question as part of an employer’s management processes. He said that this did not equate to ‘unreasonable behaviour that would be expected to victimise, humiliate, undermine or threaten the plaintiff’.[33] The judge also said that he was not satisfied that the plaintiff’s display of emotion, in the context in which it was exhibited, was evidence that should have put Mr Stewart on notice of a risk of psychological distress or harm.[34]
[32]Ibid [135].
[33]Ibid [136].
[34]Ibid.
Next, the judge noted the fact that there was no contact between Mr Stewart and the plaintiff for a considerable time after the 26 March 2012 meeting. Specifically, during the period from 26 March 2012 until 15 May 2012, the plaintiff continued to work in her job at the Melbourne Clinic, without any evidence of any manifestation of any ill effects or interaction with Mr Stewart.[35]
[35]Ibid [137].
In relation to the plaintiff’s contention that Mr Stewart’s failed to properly investigate the plaintiff’s complaint about her encounter with the second patient, the judge said that he saw nothing objectionable in Mr Stewart’s response to the plaintiff about her complaint.[36]
[36]Ibid [146].
The judge then turned to the FWWL, saying that, in his judgment, the issuing of the FWWL ‘was neither fair nor reasonable conduct’.[37] The judge was critical of the FWWL as being ‘contrary to natural justice principles’.[38]
[37]Ibid [150].
[38]Ibid.
In the course of analysing the FWWL, the judge described it as ‘procedurally inept and unjust and unfair to the plaintiff in all the circumstances and logically irrational’.[39]
[39]Ibid [158].
Having identified the various defects in the FWWL, the judge ultimately concluded that there must be ‘scope for an employer to be able to engage with its employees and to do so in error, either procedurally or legally, for which redress is available by way of breach of contract or under industrial and employment statutory protections but without such conduct being clothed as bullying’.[40] Relevantly, the judge concluded:
[W]hen a reasonable and objective analysis is made of the FWWL in light of all of the circumstances including that the FWWL does not appear to have been Stewart’s decision alone, then although industrially incompetent, and no doubt intended to put the plaintiff on notice of a risk to her continuing employment, it is not threatening or harassing or intimidatory conduct divorced from work related matters. The imperfections attendant the FWWL in bringing such work related issues to the fore should not readily be converted and characterised as bullying.[41]
[40]Ibid [164].
[41]Ibid [166].
The judge then turned to the further letter, noting that this letter was sent to the plaintiff’s home when she was on sick leave. The judge accepted a submission that there was no evidence that Mr Stewart was aware that the plaintiff’s non-attendance at the scheduled 4 June 2012 meeting was because of illness.[42] The judge accepted that, when he sent the further letter, Mr Stewart did not know that illness was the reason for the plaintiff’s absence.[43] He also observed that, serendipitously, the further letter advised of a rescheduling of the meeting to a date following the expiration of a medical certificate which had been provided by the plaintiff.[44] The judge said he was not satisfied that the further letter constituted bullying by Mr Stewart.[45]
[42]Ibid [175].
[43]Ibid [179].
[44]Ibid.
[45]Ibid [180].
The judge then dealt with the plaintiff’s meeting with Mr McKenzie on 18 June 2012. The judge was not satisfied that the plaintiff told Mr McKenzie that she felt bullied. However, he accepted that it was more likely than not that she told Mr McKenzie that she felt targeted and intimidated by Mr Stewart. In the end, the judge regarded this as being of no moment because ‘a complaint of targeting and intimidation [was] broad enough to encompass bullying’.[46]
[46]Ibid [184].
Under the heading ‘Examining Stewart’s conduct overall’, the judge said:
In arriving at my findings, I have sat back and considered whether, looked at as a whole, Stewart’s behaviour was sufficient to constitute bullying. I think it would be wrong of me to approach the matter strictly by the construction of each interaction separately without assessing how, overall, the treatment the plaintiff was afforded should be objectively assessed. In other words, I recognise that the effect on a worker of wrongful conduct can be made the worse by prior conduct.
However, having undertaken that exercise, I am unable to conclude that Stewart’s conduct was bullying of the plaintiff. Despite the plaintiff having expressed her belief to McKenzie of being targeted and intimidated by Stewart, I am unpersuaded as a matter of fact, that she was. I accept that is how she characterised it and has come to perceive it. However, I am not satisfied that the plaintiff has proved, on the balance of probabilities, as was alleged on her behalf, that Stewart’s conduct was targeted conduct directed at her for an adverse reason namely, an illegitimate use of conduct-related matters to provide the opportunity to performance manage or discipline the plaintiff to a stage at which she could be terminated.[47]
[47]Ibid [190]–[191].
Notwithstanding the judge’s conclusion that the plaintiff had failed to establish her bullying claim, the judge was critical of both the defendant and Mr Stewart, saying that:
·the defendant allowed the management of the plaintiff to be conducted poorly;
·he suspected that, in an industrial relations setting, the form and procedure adopted by Mr Stewart in his correspondence with the plaintiff would be found to be deficient and unlawful; and
·there had been denials of procedural fairness.[48]
[48]Ibid [192].
That said, the judge also observed that there was a ‘sound evidentiary basis for a number of the matters raised with the plaintiff’[49] and that the defendant was entitled to enquire into these and seek a response from the plaintiff.[50]
[49]Ibid [193].
[50]Ibid [194].
While the judge’s reasons contained further paragraphs critical of the defendant and/or Mr Stewart,[51] he concluded his reasons on the issue of bullying at Reasons [195] as follows:
For completeness sake, the plaintiff, in final address, relied on both general allegations of bullying and a number of specific incidents. Although my reasons are intended to incorporate them, I will address them as they were exhaustively expressed by [counsel for the plaintiff].
[51]See for example [365], [370], [376] and [431].
The judge then set out (at Reasons [195]) ten subparagraphs, dealing in terms with each of the matters alleged by the plaintiff in final address to comprise frank bullying by Mr Stewart,[52] with the exception of the plaintiff’s contention that there was bullying because Mr Stewart failed to property investigate the plaintiff’s complaint about the second patient.[53] In these subparagraphs, the judge explained, in respect of each of the matters relied upon by the plaintiff, why he was not satisfied that the specific matter amounted to bullying. In doing so, the judge summarised a number of findings and conclusions which he had already set out in earlier paragraphs of his judgment.
[52]See paragraph [22] above.
[53]For completeness, we note that no complaint was made by the plaintiff in this Court about the judge not revisiting that issue in Reasons [195].
Proposed ground 1: did the judge err in failing to conclude that the plaintiff was bullied?
Proposed ground 1 provides:
In respect of [the plaintiff’s] case that she was bullied by Mr Stewart in the period January to June 2012:
(a) the reasons for judgement dated 16 December 2020 are in error in the analysis and application of the law;
(b) the whole of the evidence warranted a finding of bullying of the applicant by [Mr] Stewart, which was a cause of injury, loss and damage to [the plaintiff];
(c) the reasons for judgment did not demonstrate an adequate path of reasoning for the conclusions reached by the trial judge, for the rejection of significant evidence, and for the rejection of [the plaintiff’s] submissions at trial.
Under proposed ground 1, the plaintiff contended that the judge erred in not applying (alternatively, not correctly applying) what her counsel described as ‘the two threshold issues test’ in Brown. The plaintiff also contended that the judge erred (particularly at Reasons [195]) in considering, individually, the various matters which, she had submitted at trial, constituted frank bullying; and in not considering the cumulative effect of those matters. Additionally, the plaintiff made complaint that the judge ‘impermissibly insert[ed] an element of motive into the [two threshold issues] test’; and wrongly excused the conduct complained of on the basis that it occurred in connexion with ‘legitimate work conduct matters’.
The plaintiff’s ultimate submission was that, on the judge’s own findings that were critical of Mr Stewart and the defendant’s processes so far as they concerned the plaintiff between January and June 2012, his Honour should have found that the conduct he criticised in his reasons for judgment amounted to bullying.[54]
[54]Specific reliance was placed upon the judge’s findings at Reasons [57], [82], [84]–[85], [87], [90]–[92], [97], [114], [133], [150], [152]–[155], [157]–[158], [174], [192], [195(h), (i)], [365], [370], [376] and [431].
Dealing first with the plaintiff’s submissions about the existence of the so-called ‘two threshold issues test’ and the adequacy with which the judge applied each step, we note that Brown was an appeal from the dismissal of a claim for damages for psychiatric injuries suffered as a result of alleged bullying in a workplace. In his reasons for dismissing the appeal, Osborn JA (with whom Harper JA and Macaulay AJA agreed) observed that the trial was conducted on the basis that a reasonable working definition of workplace bullying was that contained in a WorkSafe Victoria document as follows:
Workplace bullying is repeated, unreasonable behaviour directed toward an employee, or group of employees, that creates a risk to health and safety.
Within this definition:
Unreasonable behaviour means behaviour that a reasonable person, having regard to all the circumstances would expect to victimise, humiliate, undermine or threaten.
Behaviour includes actions of individuals or a group, and may involve using a system of work as a means of victimising, humiliating, undermining or threatening.
Risk to health and safety includes a risk to the mental or physical health of the employee.[55]
[55]Brown (2013) 45 VR 22, 26 [13].
His Honour then said in respect of this definition that it ‘raised two threshold issues’:
(a)was there unreasonable behaviour directed towards the appellant, ie behaviour that a reasonable person having regard to all the circumstances would expect to victimise, humiliate, undermine or threaten the appellant; and
(b)if there was, did it occur repeatedly?[56]
[56]Ibid 26 [15].
To the extent that the plaintiff submitted that Brown was authority for the proposition that claims of workplace bullying fall to be determined in accordance with the two threshold issues test, that submission must be rejected. The fact that parties to other workplace bullying claims might conduct their cases on the basis of a particular definition of workplace bullying cannot elevate that definition to some proposition of law which must be applied in any workplace bullying claim. At its highest, the definition used in Brown was, as Osborn JA observed, a reasonable working definition of workplace bullying against which allegations made by a plaintiff might be objectively analysed.[57]
[57]Ibid 26 [14].
That said, it is clear that the judge conducted his analysis of the evidence, and consideration of the plaintiff’s claim, against the working definition of bullying referred to in Brown and the definition of bullying referred to in the Workplace Bullying Procedure document. Ultimately, what the judge was required to determine was whether, on the evidence, the plaintiff established one of her pleaded causes of action — not whether or not the judge correctly applied a definition set out either in the Workplace Bullying Procedure document, or in a WorkSafe document which did not have any legislative force.
Next, the plaintiff’s submission that the judge erred by looking at the alleged episodes of frank bullying individually (rather than cumulatively) must be rejected. Plainly, the judge was required to examine each of the individual matters which the plaintiff contended amounted to frank bullying. At the most basic level, the judge was required to examine each matter to determine whether or not it occurred; in what circumstances it occurred; and whether what his Honour found to have occurred constituted a breach of duty, or was otherwise wrongful or unlawful. This is the task that his Honour engaged in during the course of his reasons, including at Reasons [195].
Having engaged in this task, the judge expressly stated that, in arriving at his findings, he had ‘sat back and considered whether, looked at as a whole, [Mr] Stewart’s behaviour was sufficient to constitute bullying’.[58] As his Honour put it, he thought it would be wrong for him ‘to approach the matter strictly by the construction of each interaction separately without assessing how, overall, the treatment the plaintiff was afforded should be objectively assessed’.[59] His Honour recognised that the effect on a worker of wrongful conduct could be made worse by prior conduct.[60] The judge then said that, having undertaken the exercise he had referred to, he was unable to conclude that Mr Stewart’s conduct constituted bullying.[61]
[58]Reasons [190].
[59]Ibid.
[60]Ibid.
[61]Ibid [191].
We see no error in this approach. Contrary to the submissions of the plaintiff, it is plain that the judge did consider the cumulative effect of the conduct which he found to have occurred.
Similarly, we see no error in such references as the judge made to Mr Stewart’s state of mind at the time of each of the matters to which we have referred or his Honour’s references to ‘legitimate work conduct matters’. It was relevant for the judge to discuss matters that go to the reasons why the conduct has occurred, particularly in a context where an act or action might appear to be of no great moment (and incapable of amounting to bullying) but, when overlaid with an improper motive or extraneous circumstance, might actually constitute bullying.
Next, we reject the plaintiff’s submission that, on the judge’s own findings, he was wrong not to be satisfied that the plaintiff had been bullied. The judge recognised that there can be personality conflicts and disagreements which occur in workplaces. People can be wrong and communications between people in authority and fellow employees may sometimes be wrongheaded or unfair — without the conduct sought to be impugned amounting to bullying or giving rise to an actionable wrong of the kind pleaded by the plaintiff in this case.
The judge carefully considered all of the shortcomings in Mr Stewart’s conduct and the deficiencies in, and associated with, the first letter, the FWWL and the further letter. Having done so, he concluded that, neither individually, nor cumulatively, did they amount to bullying. We see no error in this conclusion nor his Honour’s analysis that led to it. Plainly, the letters written by Mr Stewart were clumsy and inept. The judge’s criticisms of Mr Stewart’s conduct were also well-founded. But looking at matters in their totality, we too are not persuaded that the conduct of which the plaintiff complained at trial amounted to bullying.
Finally, there is no substance in the plaintiff’s contention that the judge’s reasons do not demonstrate an adequate path of reasoning. To the contrary, the judge explained in some detail why he accepted or rejected relevant evidence, and why he concluded that the plaintiff had not established that she had been bullied. Clearly, the plaintiff disagrees with the reasoning processes of the judge. That, however, is not a basis for contending that his Honour’s reasons were inadequate.
Proposed ground 1 must be rejected.
Proposed ground 2: did the judge err in failing to conclude that the defendant was negligent?
Proposed ground 2 provides:
In respect of [the plaintiff’s] case that [the defendant] negligently mishandled complaints about [the plaintiff] and subsequent investigations of those complaints, negligently mishandled the taking of disciplinary steps against [the plaintiff], and negligently mishandled the preparation and issuing of letters to [the plaintiff]:
(a) the reasons for judgment are in error in the analysis and application of the law;
(b) on the whole of the evidence the trial judge ought to have found that at common law [the defendant] owed [the plaintiff] a relevant duty or duties, including a duty to take reasonable care in respect of investigations and disciplinary action, to avoid foreseeable risks of psychiatric injury to [the plaintiff];
(c) on the whole of the evidence the trial judge ought to have found that [the defendant] breached its duty to [the plaintiff] by reason of the negligent mishandling of investigations and disciplinary action, and that such breach was a cause of injury, loss and damage to her;
(d) the reasons for judgment do not demonstrate an adequate path of reasoning for the conclusions reached by the trial judge, the rejection of significant evidence, and the rejection of [the plaintiff’s] submissions at trial.
At trial, the defendant contended that its duty of care to the plaintiff to provide a safe system of work did not encompass the provision of a safe system of investigation and decision making in respect of procedures for disciplining employees. In so contending, the defendant relied upon a decision of the New South Wales Court of Appeal, State of New South Wales v Paige;[62] and a subsequent decision of the Queensland Court of Appeal, Govier v The Uniting Church in Australia Property Trust (Q).[63]
[62](2002) 60 NSWLR 371 (‘Paige’).
[63][2017] QCA 12 (‘Govier’).
The defendant also submitted that, even if the duty contended for by the plaintiff existed, any such duty was not engaged because it was not reasonably foreseeable at any relevant time that the plaintiff might suffer psychiatric injury. As was said in Koehler v Cerebos (Australia) Limited,[64] the duty of care which an employer owes an employee in respect of a risk that the employee might suffer psychiatric injury arising from his or her employment is only engaged if psychiatric injury to the particular employee is reasonably foreseeable.
[64](2005) 222 CLR 44 (‘Koehler’), see in particular 57[35] (McHugh, Gummow, Hayne and Heydon JJ).
In his reasons for judgment, the judge set out the plaintiff’s claims in negligence and the relevant evidence.[65] He then turned to what he called ‘the Govier debate’.[66] In the course of his reasons, he analysed the facts of, and decisions in, Paige and Govier in some detail. The judge described Govier as a ‘hurdle’ to the plaintiff’s claim in negligence.[67] While noting that ‘the application of Govier is not absolute’,[68] the judge concluded that the duty of care alleged by the plaintiff in relation to the handling of complaints about her, did not exist.[69] Additionally, the judge was not satisfied that the plaintiff exhibited evident signs of psychological vulnerability in response to work-related matters so as to engage, at a relevant time, any duty of care in respect of a risk that she might suffer psychiatric injury.[70]
[65]Reasons [197]–[243].
[66]Ibid [245]–[277].
[67]Ibid [290].
[68]Ibid [288].
[69]Ibid [284].
[70]Ibid [290].
Under proposed ground 2, the plaintiff contended that the judge erred in not accepting that the defendant owed her a duty of care in relation to the investigation of the complaints made against her, and the actions that were taken in relation to her work performance between January and June 2012. In addition, the plaintiff contended that the judge should have found that the defendant breached the duty of care it owed the plaintiff in negligently mishandling its investigations and disciplinary procedures in relation to her, and that this negligence was a cause of her psychiatric injury.
While the parties made various submissions about the precise principle or principles for which Paige and Govier stand, ultimately it is not necessary for this Court to give any detailed consideration to those decisions. The nature and extent of any duty of care owed concerning the conduct of disciplinary proceedings was, as the judge put it, ‘purely academic to the outcome of the proceeding’.[71] This was because the judge concluded that any duty of care owed by the defendant in respect of the risk that the plaintiff might suffer psychiatric injury was not engaged until 18 June 2012 when such a risk of psychiatric injury became reasonably foreseeable.[72] We would also reject the plaintiff’s written submission that any such extension of the duty existed whether or not the risk of psychiatric injury to the particular worker was reasonably foreseeable.
[71]Ibid [246].
[72]Ibid [137], [208], [224] and [246].
Having analysed the evidence for ourselves, we agree with the judge that any duty of care owed by the defendant in respect of a risk that the plaintiff might suffer psychiatric injury did not arise until 18 June 2012, whereupon Mr McKenzie took appropriate steps to alleviate the risk by acting in a reasonable and timely manner in addressing the plaintiff’s concerns.[73]
[73]Ibid [211], [246], [434].
Further, we see no error in the judge’s conclusion that the upset manifested by the plaintiff at the 26 March 2012 meeting was not evidence that should have alerted the defendant to a risk of psychiatric injury,[74] that upset being explicable as a normal human reaction suffered by the plaintiff as a result of having to explain about going to a young person’s funeral as the reason for the taking of leave. As the plaintiff explained in her evidence in chief, what had distressed her during the 26 March 2012 meeting was:
the fact that I was being questioned about my sick leave when I had gone to a funeral and I was very emotional with it all.
[74]Ibid [290].
For completeness, we would also note the plaintiff’s answer to interrogatories that she believed that her mental health symptoms were initially experienced in June 2012.[75]
[75]Ibid [137].
Finally, there is again no substance in the plaintiff’s contention that the judge’s reasons do not demonstrate an adequate path of reasoning. To the contrary, the judge explained in clear terms that the plaintiff’s negligence claim failed because any duty of care which the defendant might have owed the plaintiff in respect of a risk that she might suffer psychiatric injury arising from her employment (including the investigation of complaints made against the plaintiff and the taking of disciplinary proceedings) was not engaged before 18 June 2012, whereupon the defendant took appropriate steps in relation to the plaintiff. In the circumstances of this case, no further reasons or elaboration beyond that provided by the judge was required.
Proposed ground 2 must be rejected.
Proposed ground 3: did the judge err in failing to accept the plaintiff’s breach of contract claim?
Proposed ground 3 provides:
In respect of [the plaintiff]’s claim for damages for breach of contract:
(a) the reasons for judgment are in error in the analysis and application of the law;
(b) on the whole of the evidence the trial judge ought to have found that the Disciplinary Procedures Policy dated July 2010, and in particular the 5 dot points under the heading ‘Policy’, and Clauses 1, 4 and 5, formed part of the [the plaintiff]’s contract of employment;
(c) on the whole of the evidence the trial judge ought to have found that the Respondent breached the [the plaintiff]’s contract of employment that such breaches were a cause of injury, loss and damage to the [the plaintiff], and the damages sought by the [the plaintiff] were not too remote;
(d) the reasons for judgment do not demonstrate an adequate path of reasoning for the conclusions reached by the trial judge, the rejection of significant evidence, and the rejection of the [the plaintiff]’s submissions at trial.
In subparagraphs (a) and (d) one sees a repetition of the language used in the first and last subparagraphs of each of grounds 1 and 2. We should immediately observe that assertions of such a high level of generality are unhelpful (and usually unpersuasive), and do not fulfil the requirement for an applicant for leave to appeal to identify the specific grounds upon which the proposed appeal is to be brought.[76]
[76]See r 64.04(d)(ii) of the Supreme Court (General Civil Procedure) Rules 2015, and in particular the requirements of specificity and conciseness contained therein. See further, State of Victoria v Bacon [1998] 4 VR 269, 285-90 (per Phillips JA).
At trial, the plaintiff contended that the Workplace Bullying Procedure document, the Disciplinary Procedures document, and another of the defendant’s procedure documents[77] were contractual documents containing express or implied terms of the plaintiff’s contract of employment with the defendant. After a detailed analysis of relevant authority (including McCormick v Riverwood International (Aust) Pty Ltd[78] and Nikolich v Goldman Sachs J B Were Services Pty Ltd[79]), the judge rejected these contentions.
[77]Being that part of the defendant’s Corporate Policy and Procedure manual, headed ‘Equal Employment Opportunity: Harassment and Discrimination’.
[78](1999) 167 ALR 689; and on appeal, Riverwood International (Aust) Pty Ltd v McCormick (2000) 177 ALR 193 (‘Riverwood’).
[79][2006] FCA 784; and on appeal, Goldman Sachs J B Were Services Pty Ltd v Nikolich (2007) 163 FCR 62 (‘Nikolich’).
In this Court, the plaintiff contends that the judge erred in failing to accept that the Disciplinary Procedures document, and in particular the five dot points under the heading ‘Policy’, and cls 1, 4 and 5, formed part of her contract of employment. In the circumstances, it is necessary for us to set out and describe parts of the Disciplinary Procedures document.
The Disciplinary Procedures document
The Disciplinary Procedures document is eight pages of closely typed material dealing with disciplinary procedures. Under the heading ‘Purpose’, the document states that its purpose is ‘to provide employees and management with a recognised process to remedy and resolve continuing problems or unacceptable employee performance or conduct’. The policy is also said to be ‘designed not only to comply with the industrial legislation but also to provide a framework that ensures fair and due process is observed’. The five dot points relied upon by the plaintiff appear under the heading ‘Policy’ as follows:
The Healthscope policy on Disciplinary Procedures is:
·Healthscope has a clearly defined process for remedying and resolving problems or unacceptable employee performance or conduct. The severity of the misconduct and the situation surrounding may impact on the nature of disciplinary action taken.
·The process includes consultation with the employee, counselling and warning where necessary, where employees are clearly informed about their performance with the aim of rectifying any problems.
·Healthscope will endeavour to ensure that all employees are treated consistently, fairly and reasonably when an unacceptable behaviour or performance issue has been identified, and that all ethical and legal considerations are properly satisfied.
·The Disciplinary Process will be accurately and thoroughly documented on the Disciplinary Procedure Form.
·Any dismissal of an employee will be in accordance with the requirements of the relevant Federal legislation.
Clauses 1, 4 and 5 of the Disciplinary Procedures document appear under the heading ‘Procedure’. In cl 1, the document provides:
1. Due Process
Healthscope believes that employees have the right to know the likely outcomes of them failing to meet expectations.
·Employees have the right to a consistent and predictable set of rules and regulations.
·Employees have the right to be fairly disciplined based on factual evidence.
·Employees have the right to challenge facts and present a defence to the allegations.
·Employees have the right to progressive discipline, unless summary dismissal is warranted.
·Employees have the right to be considered individuals.
Clause 4 is headed ‘Appropriate Persons to Conduct Disciplinary Action’. In this clause, various ‘appropriate persons’ are identified as having authority to undertake disciplinary action with respect to particular employees.
Clause 5 of the Disciplinary Procedures document deals with the actual process to be followed in a disciplinary proceeding. The clause provides that employees ‘whose behaviour or work performance is deemed as unacceptable are to be counselled and/or disciplined using the following four-step process, using the standard Disciplinary Procedure Form’. The clause then provided for ‘exceptional circumstances where the four-step process may not be followed’. The four-step process provided for in cl 5 consisted of:
·step 1 — counselling;
·step 2 — first warning (written);
·step 3 — second warning (written); and
·step 4 — termination of employment.
Clause 5 provided that steps 2 to 4 ‘should take place with at least two [representatives of the defendant] present’.
The four-step process set out in cl 5 contains multiple references to what ‘should’ occur in particular circumstances. There are also references to what is to occur in the event that a person undertaking the disciplinary action forms a particular belief. In relation to steps 3 and 4, there are also references to what ‘usually occurs’ in particular circumstances. Clause 5 is lengthy and contains considerable detail about matters of varying significance. For present purposes, it is not necessary for us to set out the whole of cl 5.[80]
[80]Extracts from cl 5 were set out by the judge at Reasons [358].
Contractual claims: the judge’s reasons
As we have already observed, in dealing with the plaintiff’s contractual claims at trial (which included claims that documents additional to the Disciplinary Procedures document were contractual) the judge referred to relevant authorities including Riverwood and Nikolich.
The judge analysed the Disciplinary Procedures document and the plaintiff’s claims with respect to it at Reasons [356]–[378], concluding that the document was not contractual, containing neither express nor implied terms of the plaintiff’s contract of employment.[81] His Honour also concluded that cl 14 of the plaintiff’s contract of employment did not incorporate the Disciplinary Procedures document into that contract.[82] Additionally, he concluded that there was no evidence in support of any objective intention by the parties that the document be contractually binding.[83]
[81]Reasons [376], [378] and [435]–[436].
[82]Ibid [352], [354].
[83]Ibid [350]–[351], [353]–[354].
In relation to cl 1 of the Disciplinary Procedures document, the judge said that it would ‘require a considerable “reading in” to interpret [cl 1] as contractual’.[84] The judge questioned how the right to be ‘fairly disciplined’ could be ‘calibrated with the four-step process elsewhere contained in [the document]’, or whether those provisions were mutually exclusive.[85] His Honour observed that the document was silent on whether legal representation was permissible at a disciplinary hearing, and silent as to the means by which an employee might challenge facts or present a defence. The judge said that it was difficult to see ‘how such a lack of prescription [could] impose contractually binding obligations or that a non-adherence to them would have been anticipated as giving rise to a contractual breach for which damages for mental harm might flow’.[86]
[84]Ibid [366].
[85]Ibid.
[86]Ibid.
In relation to the five dot points under the heading ‘Policy’, the judge observed that the language used was broad.[87] The judge noted that the requirement in the fourth dot point that the disciplinary process be accurately and thoroughly documented was obviously not complied with by Mr Stewart in the plaintiff’s case. The judge said, however, that he would not have been satisfied that Mr Stewart’s failure to thoroughly document matters was material or causative of mental harm to the plaintiff.[88]
[87]Ibid [367].
[88]Ibid.
Having analysed relevant parts of the disciplinary procedures document, the judge concluded that the document was ‘expressed in terms that belie language intended to create legal (scil, legally) binding obligations’.[89]
[89]Ibid [371]. See also [355].
Having rejected the plaintiff’s contentions that the defendant’s policy documents were contractual, the judge noted that it was not necessary for him to address the question of remoteness of damage.[90] The judge, however, said that if it had been necessary to address the question of remoteness, then he would not have been satisfied that the damage relied upon by the plaintiff as flowing from the alleged breaches of contract were within the reasonable contemplation of the parties at the time of the contract.[91] After referring to Hadley v Baxendale[92] and Commonwealth v Amann Aviation Pty Ltd,[93] and the circumstances of the plaintiff’s employment,[94] the judge found against the plaintiff on the issue of remoteness.[95]
[90]Ibid [419].
[91]Ibid.
[92](1854) 9 Ex 341.
[93](1991) 174 CLR 64, 92.
[94]Reasons [423]–[424].
[95]Ibid [425]–[428].
Proposed ground 3: conclusion
The plaintiff relies upon cls 13 and 14 of the contract of employment entered into in October 1999 as the basis for her contention that the Disciplinary Procedures document was contractual. The first point that should be made is that cl 13 of the plaintiff’s employment contract deals with the defendant’s occupational health and safety policies and procedures, and not disciplinary procedures. Clause 13 is of no assistance to the plaintiff so far as the Disciplinary Procedures document is concerned.
Riverwood, Nikolich, and this Court’s decision in Zafiriou v Saint-Gobain Administration Pty Ltd,[96] show that the resolution of the question of whether relevant parts of the Disciplinary Procedures document were binding on the defendant turns on the answers to the following three questions:
[96][2014] VSCA 331.
(a) first, whether the document was incorporated into the contract by express reference;
(b) secondly, if the document was not incorporated by express reference, whether it could be objectively concluded that the parties intended it to form part of the contract; and
(c) thirdly, if the document was part of the contract, whether it could be objectively concluded that the parties intended the relevant part of the document to have contractual effect.
Having examined the evidence led at trial for ourselves, including the Disciplinary Procedures document and its terms, we agree with the judge in his conclusion that the Disciplinary Procedures document was not contractual. It was not expressly incorporated. Specifically, looked at objectively, the terms of the document do not suggest that the parts of it relied upon by the plaintiff were intended to have contractual effect. Much of the document (including critical parts of it) is descriptive. It uses the language of discretion. It refers to what should occur, rather than what must occur. In places, it refers to what usually occurs.
Our conclusion that the Disciplinary Procedures document did not have contractual effect is fatal to the plaintiff’s contention that the parts of the document she relied upon were legally binding on the defendant. For the sake of completeness, however, we should also say that the expression ‘shall be employed subject to the policies and by-laws of the Hospital’ in cl 14 of the October 1999 contract is ambiguous as to whether it actually imposed any contractual obligation on the defendant in respect of those policies and by-laws. The language in cl 14 is to be contrasted with the language in cl 13, which provided that the plaintiff ‘shall follow safe work practices …’. That said, having regard to our conclusion that the Disciplinary Procedures document did not have contractual effect, it is not necessary for us to express a final view on the proper construction of cl 14 of the October 1999 contract.
Similarly, it is not necessary for us to express any view about the judge’s treatment of the remoteness of damage issue. The defendant contended in this Court that, as to causation and remoteness, the judge’s analysis was ‘unexceptional’. Having looked at the issue afresh for ourselves, we see no reason to disagree with the judge’s conclusions on these issues.
Finally, there is yet again no substance in the plaintiff’s contention that the judge’s reasons do not demonstrate an adequate path of reasoning. The judge rejected the plaintiff’s contractual claims because he was not satisfied that the various policies relied upon by the plaintiff constituted express terms of the plaintiff’s contract of employment, or were a basis for the finding of a relevant implied term. The conclusions of the judge, and the reasons for those conclusions, were expressed with sufficient clarity to disclose the judge’s path of reasoning. No further reasons or elaboration beyond that provided by the judge was required.
Proposed ground 3 must be rejected.
Conclusion
The plaintiff’s proposed appeal does not have any real prospect of success. Accordingly, her application for leave to appeal must be refused.[97]
[97]See s 14C of the Supreme Court Act 1986.
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