Lloyd v Healthscope Operations Pty Ltd

IN THE COUNTY COURT OF VICTORIA

AT MELBOURNE

COMMON LAW DIVISION

Revised
Not Restricted
Suitable for Publication

GENERAL LIST

Case No. CI-18-02428

LINDA PATRICIA LLOYD	Plaintiff
v
HEALTHSCOPE OPERATIONS PTY LTD	Defendant

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JUDGE:	HIS HONOUR JUDGE P GINNANE
WHERE HELD:	Melbourne
DATE OF HEARING:	17, 18, 19, 20, 24 February and 5 March 2020
DATE OF JUDGMENT:	16 December 2020
CASE MAY BE CITED AS:	Lloyd v Healthscope Operations Pty Ltd
MEDIUM NEUTRAL CITATION:	[2020] VCC 2032

REASONS FOR JUDGMENT
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Subject: TORT – NEGLIGENCE – CONTRACT

Catchwords: Duty of care – whether evident signs of distress – duty of care in conduct of work related investigations – whether policies subsequent to contract of employment incorporated by express reference - implied terms - whether reasonable care afforded plaintiff upon notice of distress – remoteness – adverse inferences

Cases Cited:Johnson v Box Hill Institute of TAFE [2014] VSC 626; Swan v Monash Law Book Co-operative [2013] VSC 326; Jones v Dunkel (1959) 101 CLR 298; Brown v Maurice Blackburn Cashman [2012] VSCA 64; Tame v New South Wales (2002) 211 CLR 317; Johnston v Holland [2016] VSC 422; Koehler v Cerebos (Aust) Ltd (2005) 222 CLR 44; Czatyrko v Edith Cowan University (2005) 79 ALJR 839; State of Victoria v Kozarov [2020] VSCA 301; Hegarty v Queensland Ambulance Service [2007] QCA 366; Govierv The Uniting Church in Australia Property Trust (Q) [2017] QCA 12; Govier v The Uniting Church in Australia Property Trust (Q) [2018] HCA Trans 65; Spring v Guardian Assurance plc [1995] 2 AC 196; State of New South WalesvPaige (2002) 60 NSWLR 371; State of New South Wales v Seedsman (2000) 217 ALR 583; Bankstown Foundry Pty Ltd v Braistina (1986) 160 CLR 301; Hayes v State of Queensland [2017] 1 Qd R 337; Toll (FGCT) Pty Ltd v Alphapharm Pty Limited (2004) 219 CLR 165; Goldman Sachs JBWere Services Pty Ltd v Nikolich [2007] FCAFC 120; McCormick v Riverwood International (Australia) Pty Ltd [1999] FCA 1640; McCormick v Riverwood International (Australia) Pty Ltd [2000] FCA 32; Riverwood International Australia Pty Ltd v McCormick [2000] FCA 889; Akmeemana v Murray [2009] NSWSC 979; Romero v Farstad Shipping (Indian Pacific) Pty Ltd (2014) 231 FCR 403; Westpac Banking Corporation v Wittenberg (2016) 242 FCR 505; McKeith v Royal Bank of Scotland Group PLC; Royal Bank of Scotland Group PLC v James [2016] NSWCA 36; Bau v State of Victoria [2009] VSCA 107; Yousif v Commonwealth Bank of Australia (No 2) [2009] FCA 656; Barker v Commonwealth Bank of Australia (2012) 296 ALR 706; McDonald v Parnell Laboratories (Aust) Pty Ltd [2007] FCA 1903; Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337; Gregory v Philip Morris Ltd (1988) 80 ALR 455; Byrne v Australian Airlines Ltd (1995) 185 CLR 410

Judgment: Proceeding dismissed.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr G A Worth with Ms L Burke	Melbourne Injury Lawyers
For the Defendant	Mr A D Clements QC with Ms F A L Ryan	Wisewould Mahony

HIS HONOUR:

Introduction and overview

1 The plaintiff was born in 1954. She was employed by the defendant at the Melbourne Clinic (“the MC”) as a receptionist and patient services provider, commencing in 1982. The MC is a private treatment centre and hospital for patients who have a dependency or mental illness or who have otherwise been referred to it for specialist treatment.

2 The plaintiff claims that over a relatively short period of time between January 2012 and June 2012, she was bullied by the finance manager of the defendant, Trent Stewart (“Stewart”). She claims that the defendant owed her a duty of care in undertaking and managing investigations conducted on its behalf by Stewart in response to a number of workplace-related allegations. In addition, she says her Contract of Employment entitled her to the benefit of a number of policies, including policies as to how disciplinary matters would be determined and, because the procedures were not complied with, her contract was breached and caused her mental harm for which she is entitled to damages.

3 The plaintiff says that she has suffered significant psychological injury as a result of Stewart’s bullying, the breach of the alleged duty of care owed to her by the defendant, and as a result of the defendant’s breach of contract.

4 I accept that the plaintiff is suffering from a mental injury by way of Chronic Adjustment Disorder with Depressed Mood. I accept, too, that her condition will in all probability preclude her from future employment. I accept that her condition developed very largely because of the way in which she responded to treatment she was subjected to in her employment by the defendant.

5 The defendant did not contest injury, but rather it contended that it is not liable to the plaintiff for her injury.

6 The plaintiff was represented at trial by Mr Worth of leading counsel, together with Ms L Burke of counsel. The defendant was represented by Mr Clements of Queen’s Counsel, together with Ms F Ryan of counsel.

The employment setting

7 At the time of the events complained of, it seems that the plaintiff was the longest serving of the defendant’s employees.

8 As at the end of 2011, and in the first half of 2012, the plaintiff was working as a permanent part-time receptionist for 38 hours per fortnight, performing shifts every Monday and Tuesday from 3.00pm until 9.00pm, and also shifts from around 1.00pm to 9.00pm every second Saturday and Sunday.

The Contract of Employment

9 The plaintiff and the defendant entered into a written Contract of Employment dated 6 October 1999.[1] It was subsequently varied by letter dated 13 April 2011, described as a “Change in Terms of Employment”,[2] together with an accompanying “Change in Employment Status and Remuneration Form”.[3] The effect of these documents on the content of the plaintiff’s Contract of Employment proved to be controversial.

[1]Exhibit P12, Plaintiff’s Court Book (‘PCB’) 290.

[2]Exhibit P16, PCB 316.

[3]Exhibit P16, Defendant’s Court Book (‘DCB’) 20.

The Plaintiff’s different claims in summary form

10 The plaintiff’s claim for damages was pressed on four principal bases, namely:

(i) that conduct by Stewart, between January and June 2012, constituted bullying for which the defendant is either directly or vicariously liable;

(ii) in the alternative, the defendant negligently mishandled two separate complaints made against the plaintiff by patients of the MC, both of which were dealt with by Stewart, and that the defendant also negligently mishandled a complaint made by the plaintiff about the conduct of one of the two patient complainants that was also dealt with by Stewart;

(iii) the defendant failed to exercise reasonable care for the plaintiff’s mental wellbeing after it became aware that Stewart’s behaviour towards her posed a foreseeable risk of psychiatric injury; and

(iv) the defendant breached its Contract of Employment with the plaintiff in its conduct of the management and discipline of the plaintiff, and that such breach was a cause of her psychiatric injury.

11 The conduct relied on by the plaintiff to amount to bullying by Stewart comprised:

(i) the authorship by him and provision to the plaintiff of three separate letters relating to workplace conduct;

(ii) facial expressions exhibited by him and the impression formed of them by the plaintiff;

(iii) his conduct of a meeting held with the plaintiff in relation to misconduct allegations arising from a patient complaint, and partially the subject of the first of the three separate letters, together with two further work-related allegations that had also been referred to in the first of Stewart’s three letters;

(iv) his subsequent investigation and management of a complaint made by the plaintiff about a patient’s behaviour towards her, and that same patient’s allegations of conduct alleged against the plaintiff.

12 The plaintiff submitted that Stewart was the “mind and will” of the defendant such that it is either directly liable for his conduct or is vicariously liable for his bullying.

13 The plaintiff argued that Stewart’s actions and conduct, when considered as a whole, amounted to deliberate bullying. Although it is common ground that intention is not a necessary element for conduct to constitute bullying, nevertheless, the plaintiff alleged that Stewart’s conduct was intentional and that he had determined to target the plaintiff in her employment and his impugned conduct was an expression of his wrongful intention.

14 The plaintiff argued that if she established, on the balance of probabilities, that Stewart’s conduct amounted to bullying and she suffered injury as a result, then she is not required to further prove that it was reasonably foreseeable that she was as at risk of psychiatric harm, or that Stewart or the defendant were on notice of a risk of mental injury resulting from the conduct.

15 In the alternative, the plaintiff argued that if Stewart’s conduct did not amount to bullying, nonetheless, the defendant is liable to her for damages for her psychiatric injuries in both the tort of negligence and in contract.

16 As to the plaintiff’s claim in negligence, she contended that the defendant owed her a duty of care to ensure she was not exposed to the risk of mental harm by unreasonable conduct by Stewart in his management of the various allegations. The plaintiff submitted that this obligation comprised an element of the defendant’s duty to provide a safe system of work. It was expressed by Mr Worth in his final address, as a “duty to take reasonable care in the investigatory and disciplinary processes to avoid foreseeable psychiatric injury”.[4]

[4]Transcript (‘T’) 404.

17 As to the plaintiff’s claim in contract, she argued that the terms of her Contract of Employment expressly or impliedly included the benefits of obligations contained in a number of the defendant’s policy documents governing employee discipline and equal opportunity and bullying, as well as a dispute resolution process contained in an Enterprise Bargaining Agreement (‘EBA’), and that Stewart’s failure to comply with a number of their provisions as part of the management of the various conduct-related matters, amounted to a breach of her Contract of Employment that resulted in psychological injury.

18 In addition, the plaintiff argued that the defendant, by its managing director, Andrew McKenzie, failed to adopt procedures to mitigate the consequences of the harm the plaintiff had suffered by Stewart’s conduct once he became aware of the plaintiff’s complaints in a meeting they had on 18 June 2012.

The Defendant’s defence in summary

19 The defendant denied that Stewart’s actions, whether by initiating, sending, or otherwise delivering three letters to the plaintiff about conduct-related matters, or that his conduct on 26 March 2012 in the single meeting conducted with the plaintiff, amounted to bullying, or that he engaged in any other conduct towards her that can be accurately described as bullying.

20 In its Amended Defence dated 17 February 2020 in answer to the breach of contract claim, the defendant:

(i) denied that the three “Corporate Policy” documents comprised terms of her Contract of Employment;

(ii) denied that the provisions of the EBA comprised terms of the plaintiff’s Contract of Employment;

(iii) denied that it breached the plaintiff’s Contract of Employment; and

(iv) said further, that if it did breach the plaintiff’s Contract of Employment, and the plaintiff suffered psychiatric injury as the result, any such breach of contract or injury, loss and damage was too remote and is not recoverable at law.

21 The defendant submitted that in the absence of a finding that Stewart’s conduct constituted bullying, then the plaintiff’s claims in negligence must fail, because she is unable to establish that the defendant owed her a duty of care in regard to the risk of her developing a psychiatric injury.

The evidence
Oral Evidence

·      Patricia Lloyd;
·      Thomas Lloyd;
·      Trent Stewart;
·      Kira Hennessy;
·      Dr Penelope Webster.

Court Documents

· Interrogatories 1, 2 and 3(a)-(c) of the plaintiff for the examination of the defendant dated 5 March 2019 and the defendant’s Answers to Interrogatories sworn 30 April 2019.[5]
[5]Exhibit P1, PCB 59-62.

Medical Reports

· Reports of Dr N Amarasekera, general practitioner, dated 24 June 2013, 15 July 2014, 23 June 2015 and 10 May 2019;[6]
[6]Exhibit P2, PCB 77-86.

· Report of Mr G Carrafa, consultant psychologist, undated;[7]
[7]Exhibit P3, PCB 87-93.

· Reports of Dr B Hayman, consultant psychiatrist, dated 13 April 2017 and 29 July 2019;[8]
[8]Exhibit P4, PCB 94-116.

· Report of Dr D Weissman, consultant psychiatrist, dated 7 May 2019;[9]
[9]Exhibit P5, PCB 117-129.

· Reports of Dr S Stern, consultant psychiatrist, dated 24 July 2012, 6 December 2012, 8 July 2013, 3 December 2013, 8 August 2014 and 12 September 2019;[10]
[10]Exhibit P6, PCB 130-173.

· Report of Dr S Adlard, consultant psychiatrist, dated 27 April 2016;[11]
[11]Exhibit P7, PCB 174-182.

· Report of Dr A Jakobovits, gastroenterologist, dated 27 May 2016;[12]
[12]Exhibit P8, PCB 183-192.

· Redacted report of Ms P Webster, consultant in complaints and organisational conflict, dated 18 August 2019;[13]
[13]Exhibit P9, PCB 193-216.

· Redacted report of Ms P Webster dated 10 January 2020;[14]

· Report of Dr N Strauss, psychiatrist, dated 28 November 2017.[15]

[14]Exhibit P10, PCB 216A-E.

[15]Exhibit P39, DCB 2-11.

The Documentary Evidence

· Job description for weekend PM shift dated February 1999;[16]
[16]Exhibit P11, PCB 281.

· Contract of Employment dated 6 October 1999;[17]
[17]Exhibit P12, PCB 290-293.

· Position Description dated February 1999;[18]
[18]Exhibit P13, PCB 290A.

· Change of remuneration status form dated 3 April 2002;[19]
[19]Exhibit P14, PCB 297.

· Email from Julie Smith to Dorothy Lane dated 13 April 2011;[20]
[20]Exhibit P15, PCB 315.

· Change in terms of employment letter dated 13 April 2011 and form[21] and change in employment status and remuneration form dated 13 April 2011;[22]
[21]Exhibit P16, PCB 316.
[22]Exhibit P16, DCB 20.

· Emails from Kellie Furey dated 23 January 2012 and 21 January 2012;[23]
[23]Exhibit P17, PCB 317.

· Email from Christine Dobson to Andrew McKenzie dated 23 January 2012;[24]
[24]Exhibit P18, PCB 318.

· Email to and from Trent Stewart dated 23 January 2012;[25]
[25]Exhibit P19, PCB 319.

· Email from Trent Stewart to Matthew Eades dated 30 January 2012;[26]
[26]Exhibit P20, PCB 320.

· Letter from Trent Stewart, finance manager, to Linda Lloyd dated 1 February 2012;[27]
[27]Exhibit P21, PCB 321.

· Letter from Trent Stewart, finance manager, to Linda Lloyd dated 29 February 2012;[28]
[28]Exhibit P22, PCB 322.

· Suggestion/Compliment form dated 13 May 2012;[29]
[29]Exhibit P23, PCB 323.

· Incident Report dated 15 May 2012;[30]
[30]Exhibit P24, PCB 324-325.

· Email from Linda Lloyd to Vicki Tonkin dated 13 May 2012;[31]
[31]Exhibit P25, PCB 326.

· Letter from Trent Stewart to Linda Lloyd dated 15 May 2012: “First written warning”;[32]
[32]Exhibit P26, PCB 327.

· Letter from Trent Stewart to Linda Lloyd dated 7 June 2012;[33]
[33]Exhibit P27, PCB 328.

· Harassment and bullying report dated 6 July 2012;[34]
[34]Exhibit P28, PCB 329.

· File note dated 6 July 2012;[35]
[35]Exhibit P29, PCB 330.

· Undated handwritten file note headed “Meeting with Linda Lloyd and Kiri Hennessy”;[36]
[36]Exhibit P30, PCB 334.

· Letter from Charlaine Havlin to QBE Workers Compensation dated 9 July 2012;[37]
[37]Exhibit P31, PCB 335.

· Letter from Andrew McKenzie dated 9 July 2012;[38]
[38]Exhibit P32, PCB 336-337.

· Equal Employment Opportunity Harassment and Discrimination Policy issue date December 2005;[39]
[39]Exhibit P33, PCB 398-402.

· Disciplinary Procedures policy dated July 2010;[40]
[40]Exhibit P34, PCB 414-421.

· Workplace Bullying – Corporate Policy and Procedure issue date May 2010;[41]
[41]Exhibit P35, PCB 581-586.

· Healthscope and Non-Clerical Employees HSU Enterprise Agreement dated 2011-2015;[42]
[42]Exhibit P36, PCB 625-691.

· Plaintiff’s statutory declaration dated 2 February 2012;[43]
[43]Exhibit P37, PCB 760-761.

· Certificates of Capacity dated 25 May 2012, 4 June 2012 and 27 June 2012;[44]
[44]Exhibit P38, PCB 757-759.

· File note regarding written complaint dated 12 March 2008;[45]
[45]Exhibit P40, DCB 13.

· Joint statement of Trent Stewart and Andrew McKenzie dated 20 July 2012;[46]
[46]Exhibit P41, PCB 764-776.

· Carnegie Medical Centre progress notes dated 3 October 2011, 25 May 2012 and 4 June 2012;[47]
[47]Exhibit P42, PCB 762-763.

· Linda Lloyd medication summary;[48]

· Linda Lloyd interrogatory 13.[49]

[48]Exhibit D1, DCB 28.

[49]Exhibit D2, DCB 27.

22 In reaching my decision, I have read and had regard to all of the lay evidence and documentary evidence, as well the medical evidence relied on by the parties, together with the final addresses of Counsel and submissions.

What is bullying?

23 Bullying is not a separate and recognised tort in Victoria. However, conduct that amounts to bullying, and causes injury to a plaintiff, may be recoverable in negligence when judged according to established principles of duty of care, foreseeability and damage. Bullying, therefore, is a species of recognisable harm that may result in injury to a person. However, in an employment setting, it is understood that reasonable management action is not bullying. An employer cannot conduct its operations if reasonable management action will be forestalled by or met with a claim for bullying. As J Forrest J put it in Johnson v Box Hill Institute of TAFE[50] (‘Johnson v TAFE’):

“Second, critical to the analysis of both the scope of the duty owed by the TAFE and its breach, is an assessment of ‘the context and objective meaning of the acts that are complained of’. In the present case, the conduct of Mr Williams has been described as bullying and harassment. But that is simply the nomenclature of Mr Johnson and his lawyers. One person’s bullying may be another’s exhortation, particularly in an employment situation. One cannot lose sight of the primary question: whether the TAFE’s conduct (or that of its employees) amounted to a breach of its duty to exercise reasonable care in reducing or eliminating the risk of psychiatric injury to Mr Johnson.”[51]

[50][2014] VSC 626.

[51]Ibid at [213].

24 By the same token, an employer cannot cloak bullying conduct with the protection of a defence of reasonable management action, for the simple reason that reasonable management action is the antithesis of bullying.

25 The defendant did not plead a defence of reasonable management action case.

Definitions of bullying

26 A definition of bullying has existed in a WorkSafe Victoria guidance note on Prevention of Bullying and Violence at Work since at least February 2003. The definition provided in the WorkSafe guidance note does not have legislative force, but it defines bullying in the following terms:

“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.”[52]

[52]Ibid at [211] citing Swan v Monash Law Book Co-operative [2013] VSC 326 [150]-[152] (‘Swan’).

27 The defendant had in place a corporate policy addressing workplace bullying. The written policy came into existence long after the plaintiff had commenced employment with the defendant. It is dated May 2010[53], and reads:

“Workplace bullying is repeated, unreasonable behaviour directed towards 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 group’s actions or practices that victimise, humiliate, undermine or threaten.”[54]

[53]Exhibit P35.

[54]Exhibit P35, PCB 581.

28 Regardless for the moment whether the defendant’s Bullying Policy has contractual force, as the plaintiff submitted it does, I accept that it contains a reasonable working definition of workplace bullying against which to objectively analyse the allegations made by the plaintiff with regard to Stewart’s alleged behaviour. It seems to me to be self-evident that the defendant adopted a policy containing a definition of bullying at least to assist it in addressing unacceptable conduct in the workplace. In my judgement, the policy can be sensibly understood as providing mutual benefits to both an employee and an employer without it necessarily being contractually binding. However, whether the policy comprised a term of the plaintiff’s contract with the defendant and was binding is a separate question for determination.

How to assess bullying – a two stepped test

29 The defendant’s policy definition of bullying is, for all relevant purposes, very similar in language to the WorkSafe definition, which has been the subject of a number of superior court decisions. These decisions have identified that whether conduct amounts to bullying calls for the application and determination of a two-step test. In Brown v Maurice Blackburn Cashman[55] (“Cashman”) for example, the Court of Appeal explained the approach to the definition in this way:

“First, was there unreasonable behaviour directed towards the plaintiff i.e. behaviour that a reasonable person having regard to all of the circumstances would expect to victimise, humiliate, undermine or threaten the plaintiff; and
Second, if there was, did it occur repeatedly?”[56]

[55][2013] VSCA 64.

[56]Ibid at [15].

30 Therefore, in accordance with Cashman, a negligence action for bullying at common law, requires a plaintiff to establish, on the balance of probabilities, that there was unreasonable behaviour in the workplace which was repeated and unreasonable, and which a reasonable person in all the circumstances of the case would expect to give rise to a recognisable psychiatric illness and it must be repeated.[57]

[57]See Cashman [2013] VSCA 64; Johnson v TAFE [2014] VSC 626, Swan [2013] VSC 326; Tame v New South Wales (2002) 211 CLR 317 (“Tame”); Johnston v Holland [2016] VSC 422 and Koehler v Cerebos (Australia) Ltd (2005) 222 CLR 44 (“Koehler”).

31 It is also accepted legal principle, that although some incidents of conduct complained of by a worker may, in a particular case, when considered, be regarded as relatively minor, the cumulative effect of offending behaviour on the individual may be sufficient to cause injury.

The developing recognition of the consequences of bullying

32 The recognition of harmful behaviour in the workplace as a form of tortious conduct that might engender psychological harm is not a revolutionary concept, but rather a manifestation of the development of the law in recognising the insidious effects that that can be wrought to the mental wellbeing of an employee by way of repeated belittling or demeaning or hurtful and threatening conduct.

33 There are a number of duties that are owed by an employer to an employee and recognised in law that may, in a particular case, prove relevant to a consideration of a bullying but that operate independently of express contractual terms. They include, but are not limited to:

(i) The duty to provide a safe place to work;

(ii) The duty to provide a safe system of work and supervision;

(iii) The duty owed to take reasonable care to protect an employee against foreseeable risk of injury arising out of their employment.

34 The nature of the employer’s duty of care was expressed in the joint judgment of the High Court in Czatyrko v Edith Cowan University[58] in this way:

“An employer owes a non-delegable duty of care to its employees to take reasonable care to avoid exposing them to unnecessary risks of injury. If there is a real risk of an injury to an employee in the performance of a task in a workplace, the employer must take reasonable care to avoid the risk by devising a method of operation for the performance of the task that eliminates the risk, or by the provision of adequate safeguards.”[59]

[58](2005) 79 ALJR 839.

[59]Ibid at [12].

35 The duty of care owed by an employer to an employee is a personal obligation and is non-delegable and attaches to the risk of injury in the performance of a task in the workplace.

The duty of care and psychological injuries

36 An employer’s duty of care extends to taking reasonable steps to prevent employees from suffering mental harm, just as it does to prevent physical harm. However, neither the scope, or content of a duty of care owed by an employer to an employee, can be considered without taking account of the obligations which the parties owe one another under their contract of employment and, to that end, it has been held, that the obligation that is owed by the employer is fixed at the time of the formation of the parties’ employment contract. This obligation has also been explained by the High Court.

37 In Koehler v Cerebos (Australia) Ltd,[60] (‘Koehler’), the High Court had occasion to emphasise the importance to examine both the content of the duty of care, together with the parties’ obligation under the contract of employment.

[60](2005) 222 CLR 44.

38 Koehler concerned a claim for psychiatric injury arising from the stress of an employee’s workload. The employee’s complaint was that she was unable to carry out her stipulated duties in the time provided to her. The Court accepted that an employer is entitled to assume, in the absence of warning of the possibility of psychiatric injury, that the employee considered themselves able to do the job at the time of executing the contract. There was no suggestion the employee was particularly vulnerable and, although she had complained, there was no evidence that she was putting her health at risk. The High Court determined that it could not be a breach of the employer’s duty of care to insist upon the employee carrying out the contractual duties to which she had agreed.

39 The following passage in the judgment of the plurality in Koehler is relevant:

“Because the inquiry about reasonable foreseeability takes the form it does, seeking to read an employer’s obligations under a contract as subject to a qualification which would excuse performance, if performance is or may be injurious to psychiatric health, encounters two difficulties. First, the employer engaging an employee to perform stated duties is entitled to assume, in the absence of evident signs warning of the possibility of psychiatric injury, that the employee considers that he or she is able to do the job. Implying some qualification upon what otherwise is expressly stipulated by the contract would contradict basic principle. Secondly, seeking to qualify the operation of the contract as a result of information the employer later acquires about the vulnerability of the employee to psychiatric harm would be no less contradictory of basic principle. The obligations of the parties are fixed at the time of the contract unless and until they are varied.”[61]

[61]Koehler (2005) 222 CLR 44 at [36] (McHugh, Gummow, Hayne and Heydon JJ)

40 As was reinforced in State of Victoria v Kozarov[62] when referring to Koehler, “the duty of care which an employer owes an employee in respect of a risk that the employee might suffer psychiatric injury arising from the performance of work is only engaged if psychiatric injury to the particular employee is reasonably foreseeable”.

[62][2020] VSCA 301 at [69].

41 In light of Koehler, it is not an easy task for a plaintiff to succeed where a psychological injury has resulted from the amount of work he or she is required to perform as part of his or her duties contained in an employment contract. However, the law recognises a distinction between different causes of psychological harm, and not all work-caused mental injuries involve workload stresses or demands associated with the performance of contracted duties. For example the claim brought by Ms Lloyd is not a workplace stress case in the classical sense, despite her pleading including an allegation of stress caused by an unreasonable workload.

42 Whilst as a matter of law it is reasonable for an employer to consider of an employee, all things being equal, that he or she will perform their contracted duties without suffering psychological injury, it is not reasonable that an employee will, in the performance of their contracted duties, anticipate being exposed to bullying, victimisation or harassment or that, if they are, that the occasioning of a psychological injury is not a reasonably foreseeable consequence and, therefore, too remote. Such conduct stands apart from, and is the antithesis of, the ordinary indicia associated with the demands and expectations of an employment relationship. As Dixon J observed in Swan v Monash Law Book Co-operative,[63] (‘Swan’) the risk of psychiatric injury from bullying behaviour is well-understood and is not a consequence that is far-fetched or fanciful.

[63][2013] VSC 326.

43 In part, because the manifestation of a psychiatric injury is not inconsistent with repeated behaviour that is belittling or threatening to its target, the law has developed to the point where, in a case of frank bullying conduct, it cannot be excused by the employer pointing to an absence of evident signs of distress by the employee along the way.

44 Overall, I would respectfully venture to suggest that the approach, adopted by superior and appellate level courts, can be seen to be different in that category of case, where breaches of duty of care have involved acts of repeated bullying that victimise or harass an employee, as compared to, for example, conduct that occasions a risk of harm due to excessive workload demands or the compliance with the usual or reasonably incidental activities of a contract of employment associated with a job of work.

The Plaintiff’s narrowed complaints of bullying

45 The plaintiff’s pleaded case, as it was ultimately expressed in her Second Further Amended Statement of Claim dated 17 December 2019 (“the Claim”), was wide ranging. Although no part of the Claim was abandoned at trial, not all allegations were the subject of evidence and, for some other allegations, the evidence was scant or depended on acts otherwise pleaded. Furthermore, not all allegations were the subject of final address and submissions.

46 For example the plaintiff pleaded that in the twelve months leading up to the end of her employment with the defendant in June 2012, she was

“… required to work in an environment in which she was exposed to a sensation of inadequate security through the failure to provide adequate security staff in the relocation of her work area to a side street known to be inhabited by drug dealers and drug users.”[64]

[64]PCB 29H-29I.

47 That allegation was not the subject of the plaintiff’s opening address, and the evidence referred to at trial in support of the allegation was limited such as when the plaintiff, in the course of her evidence, referred to the security of the entry door to the MC. There are many references to a lack of sense of security in medico-legal reports obtained by the plaintiff, but it would be wrong to approach the plaintiff’s claim for injury as one dependent on a breach of a safe working environment.

48 The plaintiff also alleged in the Claim that she sustained psychiatric injury in the final twelve months of her employment with the defendant, leading up until June 2012, as a result of being “required to undertake excessive work when the Defendant knew that the Plaintiff was suffering increasingly severe symptoms of psychiatric injury”.[65] The direct evidence concerning this allegation was also sparse. However, the plaintiff’s work demands were raised as part of a discussion Stewart had with her in their only face-to-face meeting in March 2012, and also by the plaintiff in discussions with McKenzie in June 2012. However, it would also be inconsistent with the plaintiff’s conduct of the proceeding to suggest that her claim depended on an allegation that she suffered her psychological injury due to an excessive workload or the defendant’s response to it. That is not how the plaintiff’s claim was conducted. In any event, I am not satisfied the evidence establishes that Stewart had reason to believe that the plaintiff’s comments regarding workplace demands was related to any evident signs of the development of psychological harm.

[65]PCB 29B.

49 Therefore, my reasons that follow very substantially address the claims as they were developed by the plaintiff’s Counsel at the hearing and in light of the evidence adduced.

The Plaintiff

50 Overall, I found the plaintiff to be a witness who did her best to give an account of herself and her circumstances. The events about which she complains occurred a long time ago. The plaintiff exhibited a strong sense of injustice at the manner in which she believed she was treated by the defendant, but specifically, by Stewart. The events have clearly dominated the plaintiff’s life and she has implicated Stewart as the author of her distress and illness. I am mindful of this background when looking at the issues generally. For instance, the plaintiff gave examples of how she perceived Stewart glared at her when he walked past her at work, and also that she was targeted by him. I am satisfied that at times, the plaintiff’s description of her dealings with Stewart were somewhat exaggerated and, most probably, have developed through the long lens of litigation hindsight.[66] Although I have rejected some parts of the plaintiff’s evidence, there are other parts that I have accepted.

[66]See Hegarty v Queensland Ambulance Service [2007] QCA 366 at [47] and Koehler (2005) 222 CLR 44 at 56 [28].

51 A matter of importance relied on by the plaintiff to underpin the allegations that Stewart’s conduct was bullying and that she was targeted by him depended on her impressions of Stewart’s conduct. I am able to address these issues immediately.

Allegations that Stewart “targeted” the Plaintiff

52 The plaintiff said she “felt [she] was being targeted”[67] by Stewart, although she added, “I don’t know why I had that belief, but I just had that feeling that I was being targeted”.[68] The plaintiff said Stewart would stare at her and never say anything and, “I just believe that he didn’t want me there”.[69] The plaintiff explained that she had been employed with the defendant for about thirty years and had accrued a lot of holiday and long service leave. She understood that most of the other receptionists “were very young university students that were working there on a casual basis. I was the only one that was working permanent part-time. All the other staff that were coming in, they were bringing in for three to four hours.”[70]

[67]T56.

[68]T56.

[69]T56.

[70]T94.

Allegations based on impression

53 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[71]” 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 MC and when he did come in he would gravitate to where all the young girls were[72].

[71]Exhibit P4, PCB 96.

[72]T56.

Stewart

54 Stewart testified on behalf of the defendant. He appeared to do so reluctantly. He was unimpressive. I said as much to Counsel in the course of final addresses and so as to permit Counsel to address me on the matter. Stewart was able to provide only the barest of specific recollection of the matters involving the plaintiff. Mr Clements submitted that it was unsurprising that Stewart’s evidence was littered with little memory of events that occurred in early 2012.

55 Stewart said he is presently employed as a Real Estate Agent. He is a qualified Chartered Accountant. He described his duties in the position of finance manager with the defendant as attending to “the finances of the Melbourne Clinic and the Victoria Clinic and the administration team”.[73] He said his duties expanded to embrace a number of departments including catering, cleaning and domestic services. He was asked if he became involved “in anything to do with staff management or investigations in relation to complaints about staff at some point in time” and said, “That had always been part of the role”.[74] He described McKenzie as one rung above him in the management hierarchy. He said they enjoyed an open and communicative style. He was asked whether, if complaints were made about staff, he would discuss them with McKenzie, and he said, “Yes, absolutely” and “Every time”[75] and that no action would be taken against an employee before he and McKenzie had discussed the matter. He said performance management was a “quite regular” part of his job.[76]

[73]T204.

[74]T204-205.

[75]T205.

[76]T217.

56 Stewart was asked if he was familiar with the Healthscope Policies and Procedures document for Disciplinary Procedures 2012. He said he was.[77] He was asked whether, in “making decisions or in discussions with Mr McKenzie about what action to take in respect of any particular employee, did you take that disciplinary procedures document into account?” He replied, “We would have, yes”.[78] I doubt Stewart was familiar with the Disciplinary Procedures policy document.

[77]T205.

[78]T205-206.

57 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.

58 I accept Mr Clements’ submission that Stewart’s evidence was hampered in large part because his memory of interactions with the plaintiff was virtually non-existent. The controversy occurred eight years ago. He has not been an employee of the defendant for some time. Perhaps other events in his life have overtaken the occurrences from early to middle 2012, but more particularly, it struck me that Stewart simply did not regard the dealings he had with the plaintiff in 2012 as significant. Although the plaintiff has come to regard her interactions with Stewart as a matter of importance, he did not. They also occurred over a very short period of time. Despite my assessment of his lack of interpersonal or managerial qualities, Stewart’s conduct should not be characterised as bullying merely because of a lack of personal qualities.

Management structure

59 Very little was disclosed about the management structure of the defendant. For example no organisational chart of its structure was tendered. There were competing contentions to whom the plaintiff was directly answerable. The defendant’s General Manager did not testify, which did not help clarify matters. This was unfortunate because the authority Stewart exercised and the legitimacy of it was controversial. Stewart’s Contract of Employment might have better identified his roles and responsibilities but it was not put in evidence. I was informed only by his oral evidence. However, ultimately, I was not hampered in reaching my ultimate findings of fact by the limited documentary evidence on this point. Moreover, for reasons that I will later explain, it appears that McKenzie was content for, if not approved, Stewart taking the steps related to disciplinary matters arising in connection with the plaintiff.

Plotting the course of conduct

60 The plaintiff’s case at trial concentrated very substantially on allegations of bullying conduct by Stewart comprising the manner of his investigation and management of two complaints made against her by patients of the MC, as well as a complaint by the plaintiff that she was subjected to by a patient. I shall address their development.

The first patient complaint

61 On 16 January 2012, the plaintiff was working alone on the reception desk at the MC attending to her duties when she had an interaction with a patient. The plaintiff testified about the events giving rise to the incident in this exchange in the course of her evidence-in-chief:

Q:“Can you recall an incident on 16 January 2012 when a patient came into the clinic and advised she as there to attend a group gamblers’ meeting? ---
A:Yes I can.
Q:What happened on that occasion? ---
A:On that occasion, I wasn’t aware of the meeting, I wasn’t aware where the meeting was or who was holding the meeting. A patient came to me said a meeting was on. I responded, ‘If you’d just like to take a seat, hopefully someone will be with you’. The patient sat down and as far as I know that was the end of the conversation I’d had with her.

Q: Did you have any further conversations with her? ---
A: No.
Q:What happened in respect of that patient? ---
A:In respect to that patient I had letters written to say that I’d been unhelpful.
Q:Before we get to that, on that night, 16 January 2012, did you make any enquiries about where this group gamblers meeting might be? ---
A:Definitely. There is one room in the hospital that normally held the night meetings. I’d rung that room, I didn’t get any response. I’d rung the Sister-in-Charge of the hospital to see whether she knew of this particular meeting where it might be and where it was on, she was not aware of the meeting. So I’d been ringing around all the wards and trying to find out where the meeting was and who was running it but I didn’t get any response, no-one knew where the meeting was being held.
Q:Beyond making those phone calls, what was your capacity to make further enquiries? ---
A:There was no capacity to make further enquiries because there was no-one answering the phone. I couldn’t get hold of anybody.
Q:And what, if any, ability did you have to leave the reception area? ---
A:I could not leave the reception area.
Q:Did you make any other observations about what this patient did on that night? ---
A:No I noticed her sitting down at the reception desk and 15, 20 minutes later, I’m not sure how long, I looked and she was walking out of the clinic.

…
Q:How busy or otherwise was the reception area that night? ---
A:The reception area again, it was on a Monday night, that’s when a lot of these groups were being run, there was another doctor’s program on and it was busy, answering the phone, dealing with the door, dealing with the patients.
Q:Were you the only receptionist on that evening? ---
A:Yes, I was.”[79]

[79]T52-54.

62 On 21 January 2012, the patient, by way of an email, complained about the plaintiff’s conduct. It seems that the patient happened to be an employee of the defendant.[80]

[80]Exhibit P17, PCB 317.

63 The circumstances of the receipt of the patient complaint by Stewart was the subject of extensive evidence. The narrative of the event appears to be that an email complaint was sent by the patient on 21 January 2012 addressed to Ms Kelly Furey, whose email signature identified her as the “Communications Liaison Healthscope”. The complaint said, relevantly:

“I was recently referred to this clinic by my psychiatrist for treatment and attended on Monday, 16 January for my first group class/es. The receptionist rostered that evening was unhelpful, rude, condescending and is a dangerous employee in such an environment. Working myself in a health organisation, I was appalled that such a woman could be employed in a supposedly accredited practice. Please contact me to discuss this matter as I am considering taking it to the ombudsman for further action due to the fact that her behaviour that night affectivity my already unwell state and put my life at risk.”[81]

[81]Exhibit P17, PCB 317.

64 Ms Furey replied to the complaint by email dated 23 January 2012[82] as follows:

“Thank you for contacting Healthscope. Please be assured we take this feedback seriously.
I have forwarded your comments to The Melbourne Clinic and asked the Director of Nursing to investigate the matters you have raised. They will write to you again as soon investigation has been completed.
I appreciate you taking the time to bring these matters to our attention.”

[82]Exhibit P17.

65 Ms Furey’s response was short and to the point. No evidence was led by the defendant if anything occurred as a result of Ms Furey’s request to the Director of Nursing to investigate the complaint or, if she did. Fiona Langley was the Director of Nursing at the time. She did not testify. However, Ms Furey referred the complaint to the MC and, as a result, it came to the attention of Stewart, and therein lay the seed for almost the entirety of the problems that would follow.[83]

[83]Based on the contents of exhibit P41 at paragraph 8, the complaint was also sent to McKenzie on 23 January 2012.

Stewart responds to patient complaint

66 Stewart wrote to the patient by email dated 23 January 2012.[84] Relevantly, his email read:
[84]Exhibit P19.

“Thank you very much for finding the time to inform us of your dealings with The Melbourne Clinic.
Obviously, we are very disappointed to hear that your first meeting with us was less than satisfactory, and we sincerely apologise for that.
Please be assured that we are currently looking into the situation, and I will be meeting with the staff member in question. I will also advise you of the outcome of the meeting once that has occurred.
If you would like to discuss this matter any further, or would like me to call to discuss it further with you, then please don’t hesitate to contact me.
I sincerely hope your future dealings with us are much more positive.”[85]

[85]Exhibit P19, PCB 319.

67 The email was signed by Stewart as “Finance Manager Healthscope”. Stewart said in evidence-in-chief that he had no memory of sending the email.[86] He also could not recall if he spoke to the patient.[87]

[86]T207.

[87]T208.

68 The patient responded to Stewart’s email the same day. She wrote:

“Thank you for responding to this matter so quickly. I did consider the matter carefully before taking this further as I understand that we are all only human and have bad days.
However, upon returning to the group that evening, it was apparent after a discussion surrounding what happened that this employee’s attitude and treatment of other patients has been occurring for some time and not just a one off event.
I shall await to hear from you regarding the outcome of your discussion with the staff member involved before any further action.”[88]
[sic]
[88]Exhibit P19, PCB 319.

A point of importance

69 It cannot be supposed that upon the receipt of the patient’s emailed complaint, that a form of investigation surrounding the circumstances giving rise to it was not warranted. I think it would have been a matter of neglect and of poor standards on the part of the defendant for it not to have done so. It is a concomitant of an employment relationship that an employee may be subject to discipline, including the ultimate sanction of termination. It is something that must be within the reasonable contemplation of any employee when employment commences, and regardless of the existence of written discipline policies or procedures governing disciplinary processes, and whether expressly or impliedly, any such policies themselves form part of a written contract of employment.

70 The plaintiff sensibly did not contest that the receipt of the patient complaint warranted other than an investigation by management.[89] Indeed, in her evidence, she acknowledged that she had been the subject of a number of complaints by patients over the many years of her employment and that these had been addressed with her by her employer. No evidence was led by the plaintiff regarding the process of investigation relevant to earlier complaints to suggest, for example the adoption of a different approach than followed on this occasion.

[89]T134

71 It might be thought inevitable in such a place as the MC that, over the course of an extended period of employment, an employee having direct dealings with patients or their families would invite complaints. The plaintiff was conscious and accepting of the legitimate requirement of her employer to address complaints when received. She acknowledged that she had been on the receiving end of complaints in the past.[90] Instead, the plaintiff’s case concentrated her attention on by whom, and in what manner, and to what extent the investigation concerning the patient complaint was conducted.

[90]T34.

Stewart’s conduct prior to 29 February 2012

72 A further basis on which the plaintiff relied to support her allegation that she was targeted by Stewart, was by reference to the steps he engaged in before notifying her of the patient complaint. The plaintiff alleged that Stewart had embarked on an exercise in looking for other matters of conduct he could find out about the plaintiff in order to use against her.

73 The plaintiff said she was unaware of the patient complaint until she received a letter from Stewart dated 29 February 2012[91] (“the First Letter”) whilst at work performing her reception duties, some five weeks after the receipt of the patient complaint. It is inexplicable why Stewart took the length of time he did to notify the plaintiff of the patient complaint, particularly, when it included an allegation that the plaintiff was “dangerous” and that her alleged behaviour was not a single isolated episode.

[91]Exhibit P22.

74 Stewart drafted an initial version of the First Letter, but it was not delivered to the plaintiff. It was different to the First Letter. It did not include, as the First Letter would, two additional allegations unrelated to the patient complaint. The plaintiff intimated that having drafted an initial version of the First Letter, Stewart had second thoughts and held off sending it, until he was able to find other matters of misconduct or irregularities by the plaintiff to add to it.

75 Stewart’s evidence was unhelpful in shedding light on his actions in the period between the unsent letter dated 1 February 2012 and the provision of the First Letter dated 29 February 2012, but he agreed that it was a “very long time to wait if your reputation or risk arises as a result of a complaint … .”[92]

[92]T232.

76 It is clear that Stewart used the time, if not the opportunity, to enquire into the other issues concerning the plaintiff’s work conduct and performance. He said he had only a “slight memory” of any issue arising about the plaintiff’s sick leave at around this same time[93] but he believed the issue was “there was too much of it taken post weekends and public holidays”.[94] How, or by whom, such an issue was brought to his attention was not explained, other than when, in his evidence-in-chief, he said, “… only I would assume as a result of queries around sick leave post weekends and public holidays”,[95] but he could not better remember why he was prompted to look into it.

[93]T208.

[94]T208.

[95]T208.

77 Stewart’s lack of memory also applied to another issue he raised in the First Letter, namely, the plaintiff taking longer breaks than permitted before commencing her duties on reception. Stewart said his memory of this matter was also negligible, but he thought there was an issue that “timesheets didn’t reflect the leave breaks”.[96] However, the defendant produced no evidence of timesheets disclosing any irregularities or any complaint by any other employee about the plaintiff prior to the matter being raised by Stewart in the First Letter.

[96]T209.

78 Further evidence of Stewart’s activities in looking into the plaintiff’s conduct prior to the sending of the First Letter is that, on 30 January 2012,[97] he sent the following email to Matthew Eades (“Eades”), who was apparently the defendant’s payroll manager. The email stated, relevantly:

“I am hoping you can help me - I require a sick leave report indicating any sick leave taken by Linda Lloyd, employee number … [omitted] employed at the Melbourne Clinic, detailing the dates of sick leave taken over the last couple of years if possible.
If you could please get it to me relatively quickly it would be much appreciated.”[98]

[97]Exhibit P20.

[98]Exhibit P20, PCB 320.

79 The Eades’ email was sent by Stewart two days prior to his unsent letter of 1 February 2012. Stewart could not recall sending the email to Eades.[99] The evidence did not reveal if anything responsive came of Stewart’s request from Eades. Stewart was unable to explain why he was seeking the plaintiff’s sick leave records harking back two years. When it was put to him in cross-examination that he was looking “for something to reprimand Ms Lloyd about”, his answer that it was “unlikely”[100] was peculiar. He added, “most likely it was something that was brought to my attention that we needed information in a timely manner”.[101] He had no memory whether he spoke to the plaintiff’s immediate supervisor to ascertain if there was an issue with the plaintiff’s use of leave.

[99]T208.

[100]T230.

[101]T230.

80 Despite the broad scope of Stewart’s request to Eades regarding her sick leave, ultimately, the First Letter put the plaintiff on notice of only one instance regarding her sick leave and for which an explanation was sought.

The First Letter

81 The First Letter from Stewart was dated 29 February 2012. As mentioned, it only in part addressed the patient complaint from 16 January 2012. The remainder of the First Letter referred to the two additional allegations of the plaintiff’s sick leave and of extra time taken between the plaintiff’s shifts and prior to commencing her reception duties.

82 Regarding the allegation that the plaintiff was taking additional time between breaks, Stewart could not recall if he had spoken with Christine Dobson, who was the Patient Services Manager and the plaintiff’s supervisor at the time, to ascertain if she was aware of any practice that prevailed about the plaintiff taking leave breaks in excess of 15 minutes.[102] It would have been a sensible thing to do. The plaintiff’s evidence was that the practice was understood by Ms Dobson, and that, in any event, she always made up the additional time so that there was no overall loss to the defendant.

[102]T231.

83 Stewart said he had “a brief recollection of comparing CCTV footage to timesheets, but pretty minimal recollection of anything”.[103] He explained that he would have had recourse to the CCTV because “it had been brought to my attention that there was an inaccuracy in what was being put on the timesheets and what was actually happening”.[104] He denied he was looking for something with which to reprimand the plaintiff.[105] If anything corroborative of the allegation came from the recourse to a comparison between time sheets and CCTV footage, it was not identified in the evidence.

[103]T231.

[104]T231-232.

[105]T232.

84 The First Letter was written by Stewart on the MC letterhead and was headed, “Re; Unprofessional Behaviour”. The title conveyed an air of pre-judgement, although Stewart did not agree that it did.[106] It should have been prefaced with the word “alleged,” or something similar, but overall, I think the heading “Re: Unprofessional Behaviour” can equally and reasonably be understood as consistent with a complaint of misconduct as opposed to a finding of the same.

[106]T233.

85 However, the first sentence of the First Letter was poorly expressed and did convey predetermination. It read, “It has been brought to my attention that you behaved in an unprofessional manner to a patient on Monday, 16^th January, 2012”.[107] No determination of the plaintiff having behaved in an unprofessional manner could have been arrived at by this stage in the absence of the plaintiff having been spoken to. Once again the use by Stewart of qualifying language such as “alleged” or “claimed” was warranted.

[107]Exhibit P22, PCB 322.

86 The First Letter continued:

“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 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 (sic) 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. Kerry Hennessey, 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.
… .”[108]

[108]Exhibit P22, PCB 322.

87 Stewart’s correspondence was a very unsatisfactory exercise in employee communication.

88 The plaintiff placed considerable store in the First Letter. It was argued that the First Letter exhibited a deficient process, because she had not been spoken to ahead of its receipt and that it was wrong of Stewart to have delivered it to her whilst she was on duty at reception.

89 I do not accept that it was wrong of Stewart to have presented the plaintiff with the First Letter whilst she was at work. Neither do I accept that it was wrong of him not to have spoken to the plaintiff about the matters before the provision of the First Letter. I am not satisfied that had, for example, Stewart approached the plaintiff “informally” to discuss the matters, any concerns of the nature that have been subsequently expressed by her would have been any the less. Rather, the problem lay in the content of the correspondence that included an assertion of proved misconduct, together with a lack of particulars.

90 The plaintiff contended that the First Letter was disciplinary in nature as opposed to counselling. Stewart disputed that there was anything disciplinary in the nature of the First Letter he penned to the plaintiff.[109] I think it was capable of being viewed as disciplinary when objectively assessed. I am satisfied it was a letter that certainly conveyed the possibility of disciplinary consequences. After all, the opening sentence of the correspondence was expressed as a conclusion of proved misconduct, and there was an injunction to the plaintiff not to speak with anyone else about the issues and, finally, the affording to the plaintiff of the opportunity to attend at the proposed meeting with a witness, at which would also be present the defendant’s operations manager, is the antitheses of an informal communication. The First Letter was disciplinary in construction and character, if not intent, and was not made any the less so, despite the request to attend a meeting on 8 March 2012 “to provide a response to the above-mentioned allegations”.[110]

[109]T234.

[110]Exhibit P22, PCB 322.

91 I also accept, as was pressed by Mr Worth, that it would not have been easy for the recipient of such a letter to understand how to respond to the patient allegation due to the lack of particularisation. In my judgement, an allegation of being “unhelpful”, “rude” or “condescending” invites of particulars. None were furnished. The particulars could only have been sourced by Stewart having asked the patient or having someone do so on his behalf, and Stewart could not say if he took any such steps. I doubt he did. Mr Clements, in the course of cross-examining the plaintiff, intimated that she did not really require particulars. The plaintiff disagreed. I disagree. In my view their provision was a matter of fundamental fairness.

92 The allegation of leave breaks having been taken in excess of 15 minutes was also devoid of particularity, and yet, in the First Letter, it was expressed as a finding that such conduct had occurred more than once, but without any period of time being identified. It is difficult to contemplate that a recipient of such a letter would have been able to meaningfully respond to such an allegation in the absence of the provision of such information.

93 I am also conscious that the alleged impropriety attached to the First Letter as an act of bullying cannot be fully assessed without a consideration of the plaintiff’s evidence about how it was delivered to her by Stewart.

94 The plaintiff described that on 29 February 2012, she was working nightshift and was at the reception desk when Stewart walked into reception and “threw” the letter onto the reception desk and proceeded to walk out. When, in response to the plaintiff asking, “What is this?”, Stewart replied, “Open it, you will see”.[111] The plaintiff’s husband, Thomas Lloyd, testified. He said that when the plaintiff arrived home from work she told him she had received a letter from Stewart and explained that it was a letter of reprimand or a first warning.[112] She told him the letter was “just hand-delivered” by Stewart and he simply said to her, “Here is a letter for you and tossed it to her at the reception desk”.[113]

[111]T58.

[112]T182.

[113]T182.

95 I have considered the evidence from Mr Lloyd of his wife’s description when she returned from work that evening. However, as against this, I have also considered that the plaintiff and Stewart had barely had any dealings with one another before becoming entangled in the patient complaint of January 2012. When Stewart was asked if he threw the letter, his oral evidence was no more specific than, “I don’t think I’ve ever thrown a letter at anyone, so, no”[114] and, “I have never thrown a letter in my life, so I would disagree”.[115] Despite Stewart being required to rely on a general rather than a specific memory, on balance, having paid careful attention to his response, I am not satisfied that the First Letter was thrown at the plaintiff. It makes no sense for him to have done so.

[114]T211.

[115]T233.

96 Putting the plaintiff’s account of how she received the First Letter to one side, I accept that, upon its receipt, she would have been concerned and vexed about its contents. She said she was concerned about it, and I accept that she was. I regard her attitude to the First Letter as reasonable in all the circumstances for the reasons I have given.

97 The contents of the First Letter was a piece of less than satisfactory drafting by its author. It conveyed prejudgement and it lacked particulars. As I have explained, the injunction to not speak to anyone and the affording of an opportunity to the plaintiff to attend with a witness in the context of the presence of the operations manager, taken together with the language suggesting prejudgement of the patient complaint, can be regarded as clothing both the First Letter as disciplinary in nature. I am satisfied of that characterisation as a matter of fact.

98 The First Letter resulted in uncertainty and caused the plaintiff some upset. It created uncertainty because of the lack of particulars to assist her to understand the allegations about which she was invited to respond. It caused upset because, as she explained, after reading it she burst into tears in the middle of her shift that evening. She was alone at the time. No one from the defendant had any knowledge of her reaction. Stewart did not. The plaintiff was able to continue working her shifts. There is no evidence that she required any medical treatment or time off work as a result of the provision and delivery of the First Letter. It was not submitted on her behalf that she did.

99 The calling on of an employee to respond to a complaint related to conduct-related matters is proper and legitimate and something to be anticipated by an employee. An employer might go about the matter in a ham fisted and less than ideal manner, as I am satisfied occurred in this instance, but I consider that it is important to remain alert in distinguishing poor management that occasions upset to an employee, from bullying resulting in psychological injury.

100 I have also had regard to the plaintiff’s evidence of her own thoughts about the receipt of the First Letter beyond her initial upset and the uncertainty its contents engendered. In cross-examination, the plaintiff agreed that having read the First Letter, she understood that no finding had been made against her despite the poor drafting. Her one word answer “Yes” to the question asked of her and relied on by the defendant, however, needs to be understood in the context of the multi-part question put to her, which was in these terms:

Q:“So when you finished reading the letter, you knew no finding had been made against you, all that had happened was a complaint had been received, a meeting was proposed so you’d be given a fair opportunity to respond after having had time to consider the letter. That’s what happened isn’t it? ---
A:Yes”[116]

[116]T147.

101 I think that equally relevant is the following question put to the plaintiff, and her answer:

Q:“And you were told bring a witness if you like and you chose not to? ---
A:No, because I thought I could deal with it. It wasn’t such a big deal once they hear the other side of the story. I didn’t think it was a problem.”[117]

[117]T147-148.

102 Despite the plaintiff saying she thought she would be able to explain the matter, she also said, when asked about her response to the references to sick leave and leave breaks between shifts that, “I felt as if I was being attacked, he was just holding things, sorry, one thing after the other at me”.[118] I am not satisfied that this evidence reflected the plaintiff’s attitude at the time but instead is a manifestation of how she has come to judge her treatment after many years.

[118]T59.

103 The plaintiff also said that, after reading the First Letter, she knew who the patient was to whom letter referred.[119] I am satisfied that after receipt of the First Letter, and before attending the meeting with Stewart, the plaintiff anticipated that once she was able to explain the incident to her employer, the matter of the patient complaint would be resolved. She understood that she was free to give her response to the issues raised in the First Letter and she believed and hoped the matter would be resolved once she had been heard.

[119]T59.

104 For all of the reasons I have explained, I am not satisfied that, when objectively assessed, Stewart’s conduct up to the date of the meeting was bullying or that the plaintiff believed she was being bullied, as that term is understood. A reasonable and objective assessment of the matter at this stage is that despite the ineptness in the First Letter, Stewart required the plaintiff to address work and conduct-related matters. This was reasonable on his part on behalf of the defendant. I am not satisfied that Stewart engaged in behaviour that a reasonable person, having regard to all the circumstances, would expect to victimise, humiliate, undermine or threaten the plaintiff. Each of these requirements on an objective analysis require a satisfaction of an absence of legitimacy by the actor. I am not satisfied his conduct meets that threshold.

105 I also think there is considerable merit in the defendant’s submission that it would have been potentially unfairly burdensome to the plaintiff if each of the matters referred to in the First Letter had been the subject of separate communications requiring separate responses from the plaintiff. It could have been addressed that way but it was not wrongful of Stewart to have proceeded as he did.

The 26 March 2012 meeting

106 The meeting scheduled for 8 March 2012 did not occur but instead was changed to 26 March 2012. Nothing of importance turns on the altered date.

107 The plaintiff’s work continued on undisturbed following the provision of the First Letter on 29 February 2012.

108 Those present at the meeting on 26 March 2012 were the plaintiff, Stewart and the defendant’s operations manager, Kiri Hennessy (“Hennessy”).

109 I was not convinced that any of the participants had a reliable recollection of what occurred at the meeting. For his part, Stewart produced and identified a note he said he made of the meeting. Stewart said he adopted a practice of making notes of matters involving performance management or disciplinary procedures.[120] No other notes were produced in evidence. None were called for. I do not know when the note was created. Stewart did not say when it was created. He was not asked. Nonetheless, the note had a degree of verisimilitude to the plaintiff’s account of a number of matters discussed between them.

[120]T212.

110 Hennessy testified on behalf of the defendant but she was of little assistance because she expressed an almost non-existent memory of events. She recalled attending a meeting at Stewart’s request, but she could not remember any details of it, and the provision to her of Stewart’s note did not revive her memory or improve her evidence.

111 The plaintiff’s evidence concerning the meeting of 26 March 2012 was that its “tone” was accusatory rather than investigatory. When she was asked by her Counsel for her recollection of what occurred in the meeting, she said that “all the issues was - were discussed … .”[121] She added that “All the accusations were – were put to me, and I tried to explain the situation”. She was asked by her Counsel if she had been “given a reasonable opportunity to provide input at that meeting”[122] and tellingly, she answered, “Yes”.[123] She thought the meeting lasted between 20 and 30 minutes.

[121]T64.

[122]T65.

[123]T66.

112 The plaintiff said she became distressed in the meeting and was tearful. She said that she regretted not having afforded herself the opportunity to have a support person attend with her. She said she had not understood the meeting was intended to be a counselling session until, in the course of it, she was told this by Stewart. I did not understand it to be contended for as an element of the plaintiff’s case (other than as part of the alleged breach of contract claim by reason of a failure to address work issues initially by way of a counselling session in accordance with the Discipline Procedures policy), that it was to her disadvantage for the meeting to be treated as a counselling session as opposed to a disciplinary meeting, even if the plaintiff had arrived at it under a different impression due to the matters referred to and the directives expressed in the First Letter.

113 The plaintiff was asked how the patient complaint of 16 January 2012 was addressed by Stewart. She explained that she was not furnished with any better details regarding the allegation from the patient complaint of 16 January 2012. She said she was told that there had “been a complaint from the patient that I was rude, condescending, inappropriate”.[124]She was asked to respond. Her “… response was that if there was a complaint about me it needed to be dealt with and I needed to be spoken to, if there was a complaint about me but I didn’t agree with what the complaint was”.[125]

[124]T70.

[125]T70.

114 The plaintiff said she was not provided with particulars of the occasions it was alleged she had taken longer breaks. She said she asked for particulars but Stewart said he “didn’t have any of them”.[126] She said she interpreted the complaint about her taking breaks as an allegation that she had cheated on her timesheets. She said Stewart said to her, “That I’d been cheating on my timesheets”[127] but in cross-examination, she agreed that Stewart had not accused her of cheating and instead she said, “Well, I probably took it that way”.[128] I think this is a further example of the plaintiff’s evidence being to some degree a reconstruction of events. Having said that, her assumption of the implication attributed to the allegation is a reasonable one, and I doubt an objective bystander would not have interpreted the allegation as implying cheating; however, I do not find that Stewart accused her of cheating.

[126]T67.

[127]T70.

[128]T157.

115 The plaintiff said she felt as if she was “being watched, I was being singled out, and he obviously had people around that were reporting back to him”.[129] However, she also accepted that she was given an opportunity to respond to the allegation and, in doing so, she said that “in seven years at the - with the - that I’ve been working with it had never been an issue with that 10 minutes, because it was always made up with 10 minutes after I finished work, or before I came in”.[130] She said she had taken an extra 10 minutes before her break without any issue from Christine Dobson. She said she asked Stewart if he could give her the times of or any footage related to the taking of unauthorised leave breaks but that “he couldn’t give me any of that”.[131] She said she explained to Stewart how she had insufficient time to have a meal and go to the toilet in the 15 minutes afforded her and that she was not provided any breaks after 6.00pm. She said she explained that the reception area was far too busy and there needed to be someone else on duty to handle all the programs that were being conducted at night time. She said her concerns were not addressed by Stewart in the meeting, but she thought he came up to her at some subsequent stage and said he was looking at putting on more staff, although it never occurred.[132]

[129]T71.

[130]T71.

[131]T71.

[132]T73.

116 The plaintiff said that the allegation concerning the use of sick leave consisted of an allegation that she would “take a sick leave on a public holiday”.[133] She was asked if she was provided an opportunity to respond to the allegation. Once again, she agreed she was and that, “I was given an opportunity to respond and explained the situation. That I’d - the public holiday was on a Thursday, I was not rostered on the Friday, Saturday or the Sunday, and the Monday is when I went to a funeral”.[134] She explained in her evidence that the funeral was for a young boy and that she was “very emotional”.[135] She said she had a lot of sick leave and “didn’t feel as if I was capable of going in”.[136]

[133]T67.

[134]T67.

[135]T68.

[136]T68.

117 The plaintiff was asked what it was about the conduct of the meeting that distressed her and she said that it was “being questioned about my sick leave when I’d gone to a funeral and I was very emotional with it all”.[137] When she was asked how she manifested her distress, she said “Well, I was in tears when I left the building and asked Kiri Hennessy at the time whether I could just have a break rather than going straight back to the reception desk and dealing with the patients and people”.[138]

[137]T68.

[138]T67-68.

118 The plaintiff said that after the meeting concluded she went and sat in her car for approximately a quarter-of-an-hour and cried before she was able to compose herself and return to her shift. She said that she felt the meeting ended without a resolution of the issues that had been raised with her and that she found this distressing.

119 The plaintiff said that after the meeting, and until her employment ended, she was distressed “knowing that I was being watched all the time, I was being - obviously reporting - people reporting something back to him. Anxious - when I walked in the building, whether it was going to happen again, and what was going on. I was just left - nothing happened after that.”[139] I think this is insightful evidence from the plaintiff and it suggests that she was concerned that there were others in the defendant’s employ who were watching her and reporting to Stewart about her. It is not an allegation of conduct being instigated against her by Stewart, but of unnamed people she believed were reporting on her and back to him or perhaps that Stewart had people watching her on his behalf. There is no basis in the evidence to support such assumptions.

375 So, too, the attendant vice contended for on behalf of the plaintiff of the letters of May 2012 and 7 June 2012, as being contrary to the Discipline Procedures policy and, therefore, a breach of contract invites a similar analysis and conclusion by me.

376 Mr Worth submitted that the breach of the clauses of the policy is “manifest”. Whilst it is readily enough evident that Stewart conducted himself in relation to the plaintiff on occasions in a manner inconsistent with or contrary to the Policy, that he did so, must ultimately be subordinate to whether the policy exhibits by its language an intention to create a contractual right or impose mutual contractual obligations on the plaintiff and the defendant? In my judgement, for the reasons I have endeavoured to explain, it does not. I am not satisfied that the Discipline Procedures policy was a contractual term of the plaintiff’s employment with the defendant and hence that the conduct identified amounted to a breach of the Disciplinary Procedures policy.

377 In arriving at my conclusion, I have had regard to the undisputed fact that McKenzie dealt with the plaintiff in the course of his meetings with her in June 2012 on the basis that the discipline policy did apply to the management of her employment and that The FWWL was issued to her contrary to the policy. That Policies identified processes for the employer to manage discipline or address bullying is one thing, but it is not the same as evidence of an intention for them to be contractual terms to be complied with such that on breach, a suit for damages for mental harm was contemplated.

Implied term

378 The circumstances do not arise whereby in the alternative to express incorporation by reference, the Disciplinary Procedures Policy fulfils the requirements for the implication of a term. The Policies need not be implied in order for the effective operation of the plaintiff’s Contract of Employment. The benefits intended by the Policies are in any event otherwise accessible as a matter of legal recourse to the plaintiff.

The Enterprise Agreement

379 For most of the last century, the position relating to whether legislative instruments creating workplace rights (principally and historically derived from an award) would be incorporated as terms of the contract was unclear. This issue came to a head in the late 1980s and early 1990s in a series of industrial disputes. In the case of Gregory v Philip Morris Ltd[290] (‘Gregory’), it was held that the term of an enterprise agreement was a term of the contract, giving the employee a right to contractual damages.

[290](1988) 80 ALR 455.

380 In addition, the plaintiff said she had no recollection of seeing the agreement.

381 In Byrne v Australian Airlines Ltd,[291] however, the High Court overturned Gregory. The High Court held that where the parties fail to set out the exact terms of a contract in writing, a court will only incorporate a term if it is necessary for the operation of the contract. Given that industrial instruments operate independently, their incorporation is not “necessary”, and a court should not take that step.

The Equal Opportunity, Harassment and Discrimination Policy Review – December 2006

[291](1995) 185 CLR 410.

382 The plaintiff pleaded at paragraph 5(f) of the Claim that “the Corporate Policy and Procedure on Equal Opportunity: Harassment and Discrimination dated December 2005 (review date December 2006)” was an express or implied term of the plaintiff’s Contract of Employment. I am unable to accept that it was an express term of the plaintiff’s Contract of Employment and I adopt my reasoning in relation to the Disciplinary Procedures policy. However, it is appropriate that I address the arguments advance by Mr Worth in support of breach.

383 Mr Worth submitted that if it were accepted that Stewart targeted the plaintiff for less favourable treatment because of her status, including her age, and accrued entitlements, then such behaviour was in breach of the terms of the Policy incorporated into her Contract of Employment. If the Policy was contractual and Stewart acted on the basis alleged, that result would follow.

384 I have already made findings in which I have rejected the plaintiff’s claims that she was targeted by Stewart. In any event, in my judgement, it would be contrary to the language of the Policy to regard it as providing a vehicle to allege discriminatory or harassing conduct by a manager in the conduct of work performance conduct unless such treatment was less favourable treatment based on one or other of her attributes to the treatment in like or similar circumstances afforded to some other employee but without the particular attribute. As I have endeavoured to explain, and apart from anything else, I am not satisfied the plaintiff established such a claim on an evidentiary footing in any event.

Workplace Bullying Corporate Policy

385 Was the Bullying Policy an express or implied term of the plaintiff’s contract of employment and, if so, was it breached?

386 The plaintiff alleged that the defendant breached the Workplace Bullying Policy dated May 2010.

387 On the basis of the reasoning earlier expressed and applicable to the Discipline Procedures policy, I am not satisfied that the Policy was incorporated into the plaintiff’s Contract of Employment. The expressed statement of POLICY is uncompromising in its general statement of corporate intent and that is that the defendant “will not tolerate bullying under any circumstances.” It then identifies a number of broadly expressed principles in the event of the same occurring or being witnessed. The balance of the document largely provides examples by way of guidance and assistance to a user of the Policy. It also includes reference to corporate governance Key Performance Indicators, a bibliography of external reference sources to legislation, and, as with the other Policies, is expressed as subject to reviews and consultation among a number of identified office holders in the organisation. It also contains passages by way of mandatory steps in the case of a complaint, investigation and outcomes. The document is not readily adaptable as comprising a contractual entitlement or obligation.

388 On the basis that the Policy is a contract term the plaintiff contended that she should have been provided immediately upon her complaint to McKenzie with a “Harassment and Bullying Report Form,” a document identified as part of “Manager’s action steps” and referred to in the Bullying Policy, but which according to Mr Worth was not provided until 6 July 2012 following the lodgement of her WorkCover claim. I think the position is that the provision of a Bullying Report Form was not a contractual promise between the plaintiff and the defendant. The plaintiff gave no evidence about any such form or if it was requested it. According to Mr Worth, the plaintiff was apparently also offered mediation, a step consistent with the Bullying Policy, but which as Mr Worth put it, it was all too little too late in terms of her mental wellbeing. On the facts of the case and, in light of my findings, it could hardly have been proposed before at least 18 June 2012.

389 The evidence did not identify what if anything the plaintiff did with the Bullying Form or if there was a request to progress a Bullying Complaint. There is no evidence that the Form was completed by the plaintiff and, despite the plaintiff going off work on certificates, there was no reason to suggest that it could not have been progressed. I simply do not know if it was.

390 At her meeting with McKenzie in his office on 18 June 2012, the plaintiff recalled telling McKenzie that she felt “like I was being targeted by this - Mr Stewart, and showed him the letters, which he [McKenzie] agreed were not the appropriate way to go about things”.[292] This was the extent of her recollection of her discussion with McKenzie. She said she did not know what he said, but as far as she was concerned, there was no “real outcome, he just agreed with me and then said something that wasn’t appropriate, for those letters to be sent to the way that they were sent to me”.[293] She said she asked for an apology from Stewart but never received one, although she did receive an apology in due course from McKenzie. She thought he also might have apologised to her in the course of the meeting. Her recollection is consistent with McKenzie’s recording of an apology having been proffered on that date.

[292]T83.

[293]T83.

391 Following the meeting, the plaintiff said she felt as if matters had been left in abeyance in terms of what might occur further. She said “every time I walked into the hospital, I was having a panic attack, because there was nothing. I was waiting for Andrew McKenzie to maybe get Trent [Stewart] and myself into a meeting and trying to resolve this finally. Nothing - nothing happened. There was no mention of it, anything.”[294] This would not appear to be entirely accurate because, as Mr Worth acknowledged, there was an offer of mediation that did not eventuate.

[294]T84.

392 McKenzie’s letter to the plaintiff dated 9 July 2012 dated 3 days after this second meeting with the plaintiff on 6 July 2020 referred to the plaintiff having stated on 6 July that she was anxious, stressed and not sleeping since receipt of the letters from Stewart and as well because of an increased work load with a lack of support. As I have referred to earlier in my reasons, in cross-examination the plaintiff accepted the accuracy of the matters referred to in McKenzie’s letter of 9 July 2012. The letter recorded that the outcome from the meeting on 6 July was that the plaintiff was to submit a Workcover claim; to remain on sick leave until the claim was processed and she commenced annual leave and long service lave and that Ms Havlin would be in touch with the plaintiff the following week.

393 The Policy states that an investigation of bullying “must commence within 2 working days of receipt of the complaint”. Each of the detailed steps contained in the Policy and contained under the heading “Investigation and mediation” were under McKenzie’s remit. It would not appear any step was taken within the period of the 2 days but, however, the Policy identifies that mediation should be the first consideration in resolving a bullying complaint and appropriate actions “based on findings” may include an apology, changes to work practices and disciplinary action. There is evidence enough in order for me to be satisfied that McKenzie engaged by way of a “bits and pieces” response from the suite of considerations and actions identified as available under the Policy, for example, the aforementioned and apparent offer of mediation, the apology, the withdrawal of the letters, and the advice to the plaintiff that Stewart had been counselled about the importance of compliance with procedures and policies. My ability to make these findings are not precluded because of the absence of evidence from McKenzie - they are identified from the plaintiff’s own evidence, the submissions of her counsel and the exhibits of correspondence received without objection.

394 To the point advanced by Mr Worth that they occurred all too late in the piece, in light of my findings of when McKenzie became aware of the plaintiff’s complaints about Stewart, the consideration of the response must be confined to that period and thereafter. As Mr Worth submitted the plaintiff had already sustained her injury.

395 The plaintiff has not established that if the defendant had undertaken the management and administration of the bullying complaint in accordance with the prescriptive measures contained in the Bullying Policy from within 2 days following 18 June 2012 that any such action would have avoided her injury or lessened any exacerbation of it.

396 On the question of McKenzie’s failure to give evidence Mr Worth submitted that I should draw an adverse inference. Mr Worth submitted that due to his absence and Ms Tonkin’s, about whom I have not drawn an adverse inference, I should be satisfied in drawing inferences unfavourable to the defendant and more readily accept the evidence of the plaintiff about the discussion that occurred on 18 June and the events that followed. The fact of the matter is, that I have accepted in the very large part the uncontradicted evidence of the plaintiff’s account of her discussions with McKenzie. In large part, her evidence does not stand in conflict in any meaningful way with the documentary evidence of McKenzie’s actions.

Dr Penelope Webster, expert witness evidence

397 Because of my findings it becomes unnecessary to address the evidence given by Dr Webster, who is a consultant in complaints and organisational conflict. She prepared two expert reports dated 18 August 2019[295] and 10 January 2020.[296] However, if my findings had been otherwise, it is worth noting that I would not have been much assisted by Dr Webster’s evidence in the resolution of the matters in conflict.

[295]Exhibit P9.

[296]Exhibit P10.

398 In preparation for the provision of her expert opinion, Dr Webster was provided with a letter of instructions from the plaintiff’s solicitors, together with a copy of the plaintiff’s affidavit sworn 19 September 2017 in support of her serious injury application.

399 Dr Webster’s expert evidence was directed at identifying what a reasonable employers’ management of the plaintiff’s circumstances should have involved in light of the contents of the Disciplinary Procedures policy.

400 Dr Webster noted that Step 1 of the Disciplinary Procedures policy “appears to be drafted as an informal non recorded first step”.[297] Dr Webster wrote that:

“Counselling does not require that the Appropriate Person undertake any form of investigation to ascertain the veracity of the claims about the employees’ performance or conduct prior to being counselled. This appears to be in contradiction with the stated right under Section 1 Due Process. Step 1 appears to have been drafted as an informal, non-recorded first step that is technically not part of the Disciplinary Process.”[298]

[297]Exhibit P9, PCB 194.

[298]Exhibit P9, PCB 194.

401 Dr Webster also referred to Clause 12 of the Enterprise Agreement:

“Where the employer has concerns in relation to the employee’s performance, the management representative shall notify the employee of the concern and reasons for it. And where appropriate, the matter will be dealt with by verbal counselling of the employee is the first option.”[299]

[299]Exhibit P36, PCB 630.

402 Dr Webster wrote that Stewart’s First Letter “does not explicitly state what he’s concerned about.”[300]

[300]Exhibit P10, PCB 216B.

403 Dr Webster said that Step 1 is engaged in “an informal process prior to finding out the facts and doing the investigation”.[301] She wrote:

“Based on the initial complaint and the information from Christine Dobson, it would have been reasonable to have a discussion with Linda Lloyd to hear her side of the story without putting anything in writing.”[302]

[301]T312.

[302]Exhibit P9, PCB 195.

404 However, in cross-examination by Ms Ryan of junior counsel for the defendant, Dr Webster agreed that at times having a discussion prior to putting matters in writing itself can carry risks, and that the appropriate course will depend on the circumstances including matters as diverse as, where the conversation takes place, the manner in which it is undertaken and to the legislative constraint that management action is reasonable and carried out in a reasonable way.[303]

[303]T313.

405 In regard to the patient complaint about the plaintiff of January 2012, Dr Webster was critical that the patient had not provided any examples of the plaintiff’s actual behaviour. Dr Webster did not think it was logical that just because the plaintiff was able to deny the patient allegation in the broad, that no need arose to provide her with examples of the behaviour that underpinned the description of her being “unhelpful, rude and condescending”.[304] Dr Webster said that –

“From a social science background, what we would be saying is you would to be having an open and sympathetic conversation with the patient to elicit as much information from them in a way that is as neutral as possible, so you would try and get the patient to tell them your account-, or what we would describe as-it’s their narrative from their perspective. Bearing in mind that everybody has a different perspective of what occurs.”[305]

[304]T315.

[305]T316.

406 As to the March 2012 meeting between the plaintiff, Stewart and Hennessey, Dr Webster was critical. It became apparent that Dr Webster ‘s understanding was that the plaintiff was given no forewarning that performance matters would be raised at the meeting. Her understanding was that the performance management matters concerning sick leave and leave breaks were sprung on the plaintiff at the meeting.[306] That was factually inaccurate. Dr Webster had also been advised in the letter of instructions furnished to her for the preparation of her report by the plaintiff’s solicitors that the plaintiff was not given an opportunity to explain herself at the meeting and that she was not listened to appropriately. That was also incorrect. Dr Webster was also instructed that the plaintiff was in tears and distressed about being ambushed with additional issues that were not raised in the letter of 1 February 2012. Dr Webster was not aware that the plaintiff had been alerted by Stewart in his correspondence to these performance management issues or that the plaintiff responded to them in the meeting. She said she was unaware of it.[307]

[306]T324.

[307]T325.

407 When Dr Webster was directed to the plaintiff’s evidence that she had been told by Stewart to be aware of not taking any more than a 15-minute break, Dr Webster agreed that this would constitute a course of action although, “a pretty limited course of action”.[308]

[308]T327.

408 Dr Webster said that in a busy complex reception area there may be circumstances where the plaintiff would need to take longer or shorter breaks and that a sensible manager would talk about different expectations related to the rules that applied. She thought that a simple “don’t do it approach” would fail to take into account the complexities of a working environment.[309] I note at this point, my earlier evidence that I accept Stewart encouraged the plaintiff to approach him should she not receive the necessary assistance in terms of how busy she could find herself.

[309]T327.

409 Dr Webster said that she had been asked whether the first meeting was conducted in a fair, appropriate and safe fashion and that for most people –

“… allegations and admits, that can be quite frightening and quite threatening. So it puts it into the realm of the legal process rather than an engagement with an employee about behaviour that is below the accepted standard and how the manager and the employee are going to work to get the behaviour back to the accepted standard.”[310]

[310]T328.

410 Dr Webster wrote in her report, at 7.6:

“A meeting conducted along counselling lines would not be described as distressing, causing upset or reducing a person to tears. A counselling meeting has as its aim at remedying behaviours and therefore would leave a person feeling supported and hopeful.”[311]

[311]Exhibit P9, PCB 199.

411 Dr Webster said:

“What I am saying is that a counselling session, even if it does cause the person to become distressed or upset, or reduced to tears, would not leave the person in that situation because the idea of a counselling situation in a workplace situation where you are dealing with inappropriate behaviour is to support the person to remedy the behaviour. The person is not going to be able to remedy the behaviour if they are distressed and anxious. They are more likely to be able to remedy their behaviour if they are feeling supported, understood, and given a positive way forward-so they are given some hope that they will be able to change their behaviour, and they are not taking all the blame for what occurred in a situation, because workplaces are very complex and people’s lives are complex, and certainly the research shows us that in situations of inappropriate behaviour whether you are reviewing it from the perspective of the person who is the target or the person who is the perpetrator, the context around that person is particularly important.”[312]

[312]T329-300.

412 Dr Webster also addressed the May 2012 incident. Dr Webster could not explain why she had written in the report that the patient had lied.

413 Dr Webster said that she had been told that the plaintiff’s evidence had been that McKenzie’s tone at the meeting on 18 June 2012 was apologetic and conciliatory and Dr Webster’s understanding was that McKenzie had apologised for the provision of the letters from Stewart.

414 I add this additional comment concerning Dr Webster’s evidence. It cannot be overlooked that considered necessity for the provision of expert evidence to explain how the various steps in Policies should be applied in a generic sense and how their application may be open to interpretation in a given case in a workplace, is a further indication that the policies are aspirational in nature and to be used as a guide but not as prescriptive contractual obligations.

Evidence of Thomas Lloyd

415 I have earlier in my reasons related Mr Lloyd’s evidence of his conversation with his wife. He has been married to the plaintiff for approximately forty years. He said that his wife told him she received a letter from Stewart when she arrived home from work and that she explained that it was a letter of rep remand or a first warning.[313] He said she told him the letter was “just hand-delivered”[314] by Stewart who simply said to her: ‘“Here is a letter for you” and tossed it to her at the reception desk.”[315]

[313]T182.

[314]T182.

[315]T182.

416 Mr Lloyd said he attended one meeting with his wife as her support at the MC at which were present McKenzie and either Christine Dobson or her replacement.[316] He recalled McKenzie making an apology to the plaintiff in reference to the letters that were sent to her[317] and he thought McKenzie explained that he was apologising because “they were handled incorrectly. As he is the general manager, he felt that the letters should have gone through him first, which he didn’t know about because he never signed the letters, as far as I know.”[318]

[316]T184.

[317]T184.

[318]T185.

417 Mr Lloyd said that between February to June 2012, his wife’s condition was dreadful. She was dry wrenching on any day she had to go to work.[319] He said she was taking sleeping tablets during this period and it was taking her a long time to get to sleep.[320] He said that by comparison and prior to 2012, her personality was fine and she would potter in the garden and take the dog for a walk and she was quite chirpy.[321] He said she had belonged to a book club and a craft club, knitting, and would catch up with mums from other schools and enjoyed going out to someone else’s house but that “after all these issues started … she just didn’t feel like socialising with anybody”.[322]

[319]T187.

[320]T188.

[321]T190.

[322]T192.

The Plaintiff’s mental injury

418 At the very outset of these reasons for decision, I observed that it was not a matter of contest between the plaintiff and the defendant that the plaintiff suffers from a psychological injury. The medicine was substantially all one way and that it is the plaintiff has suffered stress in her work with the MC. Thus factual causation was not contested. The reports relied upon by the plaintiff in relation to diagnosis are broadly consistent. The attribution of the cause of the plaintiff’s mental condition is understandably dependent on the examiners accepting the plaintiff’s account of history of her dealings at work. However, there is unanimity of opinion that the mental harm was occasioned to the plaintiff in the workplace with the defendant and ultimately as result of her reaction to the manner in which she dealt with in the period between January and June 2012.

Remoteness

419 The parties addressed the question of remoteness of damage in the event I was satisfied the Policies were contract terms and that had been breaches of them. Because of my findings it is not necessary to address the question. Had it been necessary to do so, I would not have been satisfied that the damage relied on as flowing from the breaches should be regarded as being within the reasonable contemplation of the parties at the time the contract, that is to say the various Policies were entered into.

420 The degree of probability of the occurrence of the loss or damage claimed by way of breach of contract has been variously described in the authorities. In Hadley v Baxendale[323] the following was said:

“Where two parties have made a contract which one of them has broken, the damages which the other party ought to receive in respect of such breach of contract should be such as may fairly and reasonably be considered either arising naturally, i.e., according to the usual course of things, from such breach of contract itself, or such as may reasonably be supposed to have been in the contemplation of both parties, at the time they made the contract, as the probable result of the breach of it.”[324]

[323](1854) 9 Ex 341.

[324]Ibid at 354.

421 Subsequently in The Commonwealth v Aman Aviation Pty Ltd[325] (‘Aman Aviation’) it was recognised that the two limbs referred to Hadley v Baxendale, and their application may depend on the extent of relevant knowledge possessed by a defendant in a particular case.

[325](1991) 174 CLR 64 at 92.

422 In Nikolich the damage for psychiatric injury arising from breach of his contract of employment was not considered too remote. That, however, will not mean that in every such case, a like result must follow.

423 On the information available to the defendant when the contract with the plaintiff was made, and for present purposes that will be the date the relevant policies were each adopted, would the defendant have realised that it was sufficiently likely that the plaintiff would suffer psychological injury as a result of the breaches of each of the policies relied on, such that it would be appropriate to determine that the plaintiff’s losses flowed naturally from such breach or breaches or was of a kind of damage that should have been within the defendant’s contemplation?

424 The plaintiff had worked for the defendant for a significant number of years, over which she had managed her employment including other complaints from patients and separate to the issues that have occupied this proceeding. She navigated what she agreed could be a difficult work environment without putting the defendant on alert to any vulnerability such as to indicate that she was at risk of psychiatric injury that might flow naturally for any breaches of policy.

425 I am not satisfied that it should be thought to have been in the reasonable contemplation of the defendant that the articulated breaches of the Policies relied upon by the plaintiff was sufficiently likely to result in psychological injury to her.

426 Whilst I accept that the purpose underpinning a bullying policy, unlike a disciplinary policy, is directed at the provision of a workplace free from harassment and intimidation, and therefore, has a more identifiable connection with the emotional and mental well-being of an employee, the matter nonetheless reverts to whether the identifiable breaches would, based on the degree of relevant knowledge possessed by the defendant in this case, result in it being properly concluded that psychological damage would flow from such breach or breaches.

427 I would not have been satisfied that the occurrence of the specific breaches relied upon by the plaintiff either under the Discipline Policy or the Bullying Policy or the Equal Opportunity Policy or by non-compliance with the Enterprise Agreement, should have put the defendant on alert to risk of the plaintiff’s psychiatric injury. It cannot be supposed that the defendant should have had it within its reasonable contemplation that because the investigations were left to Stewart that the plaintiff would likely have suffered her mental injury. As to the Bullying Policy, I have already referred to the fact that circumstances identifying a breach of its terms is questionable other than by what would appear to be a failure by McKenzie to provide the plaintiff with a Bullying Form immediately on 18 June 2012 and a failure to engage any of the processes and procedures within a period of the first 2 days after 18 June. I would not in any event have been satisfied that the defendant should have had within its contemplation that such breaches if they occurred was sufficiently likely to result in mental harm to the plaintiff.

428 Bearing in mind that the plaintiff bears the onus of proving that her claimed losses are not too remote in accordance with Aman Aviation, I would not have been satisfied she discharged her onus that such loss and damage was not too remote.

Conclusion

429 There is no doubt in my mind that the plaintiff was treated poorly by Stewart and she has suffered by way of the development of a significant mental injury. The effects remain with her. However, I have been unable to accept and find that Stewart’s conduct amounted to bullying.

430 I have accepted that Stewart’s conduct that gave rise to the plaintiff’s injury arose in the context of work related matters. I have accepted Stewart had authority to investigate the matters. That authority was approved of the General Manager. To the submission made by Mr Worth that I should draw an adverse inference because of the failure of the defendant to adduce evidence from Ms Dobson, the fact is that any evidence that might have addressed the existence of a prior understanding or arrangement about leave breaks, would not have precluded Stewart from an entitlement to address any complaint about it or to direct the plaintiff to be conscious about it. The fact that her evidence might have addressed the hierarchy of command was otherwise disposed of by the General Manager’s approval for Stewart to undertake disciplinary steps in regard to the plaintiff. I am not persuaded an adverse inference is called for.

431 I have accepted that Stewart went about the investigations in a manner that in particular aspects already identified in my reasons, was attended with a substantial lack of fairness.

432 I have accepted, however, that the law precludes the defendant from liability for the mental injury caused to the plaintiff as a result of the conduct of such matters.

433 If I am wrong as a matter of law, then I would not be satisfied the plaintiff proved that the defendant was under a duty of care to avoid the risk of mental injury due to the lack of evident signs of distress until June 2020.

434 I am satisfied that thereafter and from 18 June 2012, the defendant acted reasonably after becoming aware of the plaintiff’s expressed distress in her previous dealings with Stewart.

435 I am not satisfied that the Policies or the enterprise agreement were express terms of the plaintiff’s contract of employment with the defendant.

436 I am not satisfied the policies or the enterprise agreement terms were implied terms of the contract of employment at law.

437 The plaintiff’s claim is dismissed. I will hear the parties on the form of final order including costs.

[2020] VCC 2032

16 December 2020