Milonas v Monash Health
[2024] VSCA 57
•8 April 2024
| SUPREME COURT OF VICTORIA COURT OF APPEAL |
| S EAPCI 2023 0019 |
| VIVIAN MILONAS | Applicant |
| v | |
| MONASH HEALTH | Respondent |
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| JUDGES: | BEACH, KENNEDY JJA and J FORREST AJA |
| WHERE HELD: | Melbourne |
| DATE OF HEARING: | 7 February 2024 |
| DATE OF JUDGMENT: | 8 April 2024 |
| MEDIUM NEUTRAL CITATION: | [2024] VSCA 57 |
| JUDGMENT APPEALED FROM: | [2022] VCC 1964 (Judge Pillay) |
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EMPLOYMENT – Summary dismissal – Applicant dismissed following finding of serious and wilful misconduct – Applicant accused of falsifying timesheets – Whether trial judge erred in making finding that applicant submitted fraudulent timesheets – No error in reasoning of trial judge – Application for leave to appeal refused.
EVIDENCE – Whether trial judge failed to consider medical evidence of applicant’s cognitive impairment – Whether trial judge’s consideration of the evidence of the applicant was erroneous – No error demonstrated – Fox v Percy (2003) 214 CLR 118, Stevens v DP World Melbourne Ltd [2022] VSCA 285, SS Hontestroom v Sagaporack [1927] AC 37, Brunskill v Sovereign Marine and General Insurance Co Ltd (1985) 59 ALJR 842, Devries v Australian National Railways Commission (1993) 177 CLR 472, Lee v Lee (2019) 266 CLR 129, Robinson Helicopter Company Inc v McDermott (2016) 331 ALR 550, s 140(2) Evidence Act 2008, referred to – Application for leave to appeal refused.
CONTRACT – Whether Code of Conduct and Enterprise Agreement incorporated into contract of employment – Whether incorporated terms breached by employer in failing to provide procedural fairness to employee – No such terms found to be incorporated – No breach of terms found – Lloyd v Healthscope Operations Pty Ltd [2021] VSCA 327, Byrne v Australian Airlines Limited (1995) 185 CLR 410, Vision Australia Ltd v Elisha [2023] VSCA 265, referred to – Application for leave to appeal refused.
NEGLIGENCE – Whether employer owed duty of care to employee in relation to investigation and determination of employee’s alleged misconduct – No such duty of care owed – No breach of duty of care found – State of NSW v Paige (2002) 60 NSWLR 371, Shaw v State of NSW [2012] NSWCA 102, Govier v The Uniting Church in Australia Property Trust (Q) [2017] QCA 12, Irving & Ors v Kleinman [2005] NSWCA 116, Sullivan v Moody (2001) 207 CLR 562, Potter v Gympie Regional Council [2022] QCA 255, Farah Construction Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89, Briginshaw v Briginshaw (1938) 60 CLR 336, Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1, MH6 v Mental Health Review Board (2009) 25 VR 382, Public Service Board (NSW) v Osmond (1986) 159 CLR 656, White v Ryde Municipal Council [1977] 2 NSWLR 909, Health Services Act 1988, pt 3.2 Fair Work Act 2009 (Cth), O 56 Supreme Court (General Civil Procedure) Rules 2015, referred to – Application for leave to appeal refused.
PRACTICE AND PROCEDURE – Application for adjournment – Whether application for leave to appeal should be adjourned pending hearing of appeal to High Court of Vision Australia Ltd v Elisha [2023] VSCA 265 – Adjournment application refused.
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| Counsel | |||
| Applicants: | Mr ADB Ingram KC with Dr JC Plunkett | ||
| Respondent: | Ms M Britbart KC with Mr SE Gladman SC | ||
Solicitors | |||
| Applicant: | Carbone Lawyers | ||
| Respondent: | Hall & Wilcox | ||
BEACH JA
KENNEDY JA
J FORREST AJA:
Vivian Milonas (the applicant for leave to appeal) was, from 1974 to May 2013, employed by Monash Health (the respondent to the application, hereafter ‘Monash’).[1] From 1987, she was employed in the Food Services Department at the Monash Medical Centre (‘MMC’).
[1]Ms Milonas’ initial employment was in the Food Services Unit at Queen Victoria Hospital, which was later relocated to the Monash Medical Centre in Clayton which was part of Southern Health. Southern Health subsequently changed its trading name to Monash Health, the respondent to the application.
Following an investigation, she was dismissed by Monash in May 2013 after 36 years of service, on the basis that allegations that she falsified timesheets and rosters over a period of nearly six years and unjustly enriched herself were made out and justified the termination of her employment.
Ms Milonas then issued a proceeding in the County Court against Monash. She asserted that the manner of the termination of her employment and the investigation that led to it was both in breach of a duty of care allegedly owed by Monash to her and was in breach of the terms of her contract of employment. These breaches were alleged to have given rise to a significant psychological injury.
The trial judge, his Honour Judge Pillay, dismissed Ms Milonas’ claim.[2] He did not accept her account (corroborated by her manager, Mr Arvind Sharma) that her extra income supported by the falsified timesheets was the subject of an arrangement made in 2007 and authorised by a Monash senior manager. He also dismissed Ms Milonas’ claim as to the existence of terms within the employment contract requiring the investigation and dismissal process to comply with the rules of natural justice. The judge rejected the further claim that Monash owed Ms Milonas a duty of care in relation to the conduct of the investigation and dismissal process and if there was such a duty he held that it had not been breached.
[2]See Milonas v Monash Health [2022] VCC 1964 (‘Reasons’).
Despite the multiplicity of grounds, this application turns on two fundamental issues:
(a)whether the judge erred in rejecting Ms Milonas and Mr Sharma’s account of the arrangement allegedly entered into at a meeting with Ms Denese Billings (formerly Unicomb),[3] a senior Monash manager; and
(b)if Ms Milonas was entitled to due process (either in contract or tort) whether, in the course of the Monash investigation leading to the termination of her employment, Ms Milonas was denied procedural fairness.
[3]For consistency with the Reasons in the County Court, these reasons refer to Ms Unicomb.
Prior to the hearing of this application, the lawyers for Ms Milonas sought that it be adjourned pending the disposition of a special leave application to the High Court in relation to the decision of this Court late last year in Vision Australia Ltd v Elisha.[4] That application raises two points of principle which, as counsel for Ms Milonas contended, are potentially relevant to this application, namely:
(1)Can an employer’s duty of care to its employees extend to provision of a safe system of investigation and decision-making as to discipline and termination?
(2)Does Addis v Gramophone Co Ltd[5] preclude recovery of damages for psychiatric injury consequent upon wrongful dismissal from employment? If so, should it no longer be followed?[6]
[4][2023] VSCA 265 (McLeish, Kennedy and Macaulay JJA) (‘Vision Australia’) on appeal from the decision of O’Meara J: Elisha v Vision Australia Ltd [2022] VSC 754.
[5](1909) AC 488.
[6]See special leave application dated 19 December 2023, [5]–[6].
Subsequent to the hearing of the application, special leave to appeal the decision of this Court in Vision Australia was granted by the High Court.[7] The appeal itself has not yet been set down for hearing.
[7]Elisha v Vision Australia Ltd [2024] HCASL 60.
We did not accede to Ms Milonas’ application as, in our view, neither of these issues (which, in the context of this proceeding, had the potential to be of significance) are engaged. This is because, as we will endeavour to explain, the primary judge, correctly, did not accept that Ms Milonas had established her case that there was (a) an incorporated term of the employment contract obliging Monash to accord Ms Milonas ‘natural justice’; or (b) a putative breach of the alleged duty of care.
In other words, as the application for leave to appeal was unsuccessful on these two points, the principles in dispute in the High Court appeal in Vision Australia were not relevant to its disposition. It was accordingly not necessary to recall the parties or to alter our approach to the determination of this application.
Ms Milonas’ pleaded case
The claim was commenced by writ filed in this Court on 31 August 2020 and subsequently transferred for trial in the County Court. An amended statement of claim was filed on the second day of the trial on 29 September 2022.
The amended statement of claim asserted that Ms Milonas ‘sustained injury in the course of her employment with the Defendant and more particularly in or about May 2013 when the Plaintiff was wrongly accused of falsifying timesheets and in consequence being overpaid for work which she did not perform, and subsequently in terminating the Plaintiff’s employment with the Defendant for alleged serious and wilful misconduct’.
The amended statement of claim alleged that Ms Milonas’ injuries ‘were caused by reason of the negligence of [Monash], its employees or agents’. Putting aside the generic allegations of breach, those specifically related to Ms Milonas’ claim were particularised as follows:
(f)Wrongly accusing the Plaintiff of falsifying time sheets;
(g)Wrongly accusing the Plaintiff of receiving overpayments for work which she did not perform;
(h)Failing to investigate adequately or at all any agreement made between the Plaintiff and her director in relation to her hours and conditions of employment;
(i)Failing to comply with the Defendant’s terms and conditions of employment of the Plaintiff;
(j)Failing to institute investigatory and/or disciplinary procedures in accordance with the Defendant’s terms and conditions of employment of the Plaintiff;
(k)Wrongly terminating the Plaintiff’s employment;
(l)Failing to have in place a policy and procedure for the proper and fair reporting and investigation of allegations of improper conduct at the time the Plaintiff was wrongly accused of falsifying timesheets.
The contractual claim was pleaded as follows:
Further and in the alternative, the injuries were caused by the breach by the Defendant of the Plaintiff’s contract of employment with the Defendant (“the employment contract”).
PARTICULARS OF THE EMPLOYMENT CONTRACT
(a)The Plaintiff commenced employment with the Defendant in approximately 1974;
(b)By letter dated 15 September 1977, the Plaintiff’s employment as a casual employee under the Hospital and Benevolent Homes and Determination was confirmed;
(c)For more than 25 years, the Plaintiff worked as an afternoon shift supervisor for the Defendant;
(d)In June 2007, the Plaintiff was appointed to the position of Food Service Supervisor which, through loss of shift penalties, would have resulted in loss of income to her;
(e)In order to achieve salary maintenance, the Plaintiff understood that agreement was reached through Group Leader Denise [sic] Unicomb and Food Service Manager Arvind Sharma whereby the Plaintiff would continue to receive the income which she had previously received in her new position (“the salary maintenance agreement”);
(f)To achieve salary maintenance the Plaintiff from approximately July 2007 until May 2013 continued to submit timesheets in accordance with the employment contract as she understood it;
(g)Incorporated into the Plaintiff’s employment contract was the Victorian Public Sector (Health Professionals, Health and Allied Services, Managers & Administrative Officers) Enterprise Agreement 2011-2015 (“the Agreement”), of which Cl 77.5.1(a) required the Plaintiff to be afforded natural justice in any grievance or dispute arising from wage payments;
(h)Incorporated from the Agreement, Cl 77.5.1(c) required a proper consideration of the matter;
(i)Incorporated into the Plaintiff’s employment contract is the Defendant’s Code of Conduct which, inter alia, required employees to act honestly, in good faith, with due care and diligence and in compliance with policies and procedures of the Defendant.
PARTICULARS OF BREACH
(a)Failing to honour and/or give effect to the salary maintenance agreement including by wrongly accusing the Plaintiff of falsifying timesheets;
(b)Failing to afford the Plaintiff with natural justice in levelling and investigating the accusation that the Plaintiff falsified timesheets, and ascertaining whether the timesheets submitted by the Plaintiff were submitted on the basis of the salary maintenance agreement;
(c)Failing to give the accusation that the Plaintiff falsified timesheets, and the investigation relating to this accusation, proper consideration, including considering whether or not the timesheets were submitted on the basis of the salary maintenance agreement;
(d)Failing to act honestly in investigating the Plaintiff;
(e)Failing to act with due care and diligence in investigating the Plaintiff and determining whether she had acted in good faith and in her belief honestly in submitting her timesheets;
(f)Failing to comply with the Defendant’s ‘Employees’ Code of Conduct’ as at July 2007 and the Defendant’s ‘Code of Conduct – Staff – Operational Policy’ approval date 10 April 2013, including by:
i.Failing to ensure that the decision to make allegations of overpayment towards the Plaintiff and to terminate the Plaintiff’s employment was fair;
ii.Failing to treat the Plaintiff fairly and reasonably during the allegation and investigation process;
iii.Failing to impartially investigate the Plaintiff;
iv.Failing to resolve the allegations levelled against the Plaintiff fairly.
(g)Failing to comply with the Defendant’s ‘Fraud Reporting - Procedure’ approval dated 16 April 2012 including by failing to investigate allegations of fraud against the Plaintiff in compliance with the disciplinary code set out in the Southern Health Employees’ Code of Conduct;
(h)The Plaintiff reserves the right to provide further particulars of the breach of her employment with the Defendant following the completion of further and better discovery by the Defendant including the provision of the Plaintiff’s contract of employment as at 1974 when she commenced employment with the Defendant and/or any other undiscovered contract of employment thereafter which is provided throughout the course of the Trial.
Pausing here, a number of points should be made about Ms Milonas’ case.
First, the claim in negligence is confined to the actions of Monash from the time it, through its employees, learnt of the allegations by way of two anonymous notices (set out at [38] and [39] below) in late April 2013 until Ms Milonas’ dismissal on 20 May 2013.
Second, (and this flows from the first point), the alleged meeting in January 2007 and any arrangement in relation to the submission of false timesheets (referred to as the ‘salary maintenance agreement’) is of significance in two ways. It is contended that it forms part of Ms Milonas’ contract of employment. It also provides the substratum of fact relevant to Ms Milonas’ claims in contract and negligence in relation to the conduct of the investigation resulting in her dismissal. The circumstances surrounding the alleged salary maintenance agreement are relevant but only concerning the manner in which the Monash staff went about the process of investigating and concluding the inquiry into the allegations in the two notices. As in Vision Australia, the primary issue, if there be a cause of action available to Ms Milonas, is the way the investigation and termination of her employment was carried out by Monash staff. Ms Milonas’ claims would not be made out if she establishes only that the salary maintenance agreement existed as she alleges: she also needs to demonstrate that Monash’s investigation process was conducted in such a way as to constitute a breach of Monash’s duty of care as her employer and/or a breach of her employment contract.
Third, particulars of negligence (f) and (g) in the amended statement of claim are untenable. They are not allegations of negligence (rather of deliberate misconduct which could be the subject of alternative relief by Ms Milonas) and do not flow from any alleged duty of care owed by Monash or its employees to Ms Milonas.
Fourth, Ms Milonas’ claim for breach of the employment contract alleges that the salary maintenance agreement, certain provisions of Monash’s enterprise agreement, multiple employees’ codes of conduct, fraud reporting procedures and the employees’ disciplinary code were all incorporated as terms of Ms Milonas’ employment contact (of which only two were relied upon). The existence of the salary maintenance agreement turns upon acceptance of the alleged oral agreement in 2007 — which the judge rejected. The judge also rejected the incorporation of parts of both a specific code (The Southern Health Employees Code of Conduct (the ‘Code of Conduct’)) and the Victorian Public Sector (Health Professionals, Health and Allied Services, Managers and Administrative Officers) Enterprise Agreement 2011–2015 (the ‘EA’) into Ms Milonas’ employment contract.
Fifth, as mentioned earlier, we have proceeded on the basis that, in the context of the facts and findings in this case, it is appropriate to determine whether the judge’s findings in relation to breach of duty in the negligence claim, are successfully impugned notwithstanding our conclusion as to the existence of a duty.
The trial — in precis
The trial of the proceeding was heard over 16 sitting days between 28 September 2022 and 9 November 2022.
On behalf of Ms Milonas, the following witnesses gave evidence:
•Mr Arvind Sharma, former Food Services Manager of Monash;
•Ms Denese Unicomb, former Group Manager of Monash;[8]
•Mr Nick Goutzamanis, Ms Milonas’ cousin;[9]
•Dr Michael Piperoglou, treating psychiatrist;
•Dr Sudkhakar Vaseudevan, treating general practitioner;
•Dr Albert Kaplan, consultant psychiatrist; and
•Dr Penelope Webster, workplace relations expert.[10]
[8]Ms Unicomb was originally called by Ms Milonas and asked only a very small number of questions in evidence-in-chief. She was subsequently recalled and gave evidence as part of Monash’s case.
[9]Mr Goutzamanis’ evidence was directed to the assistance he gave Ms Milonas in respect of her WorkCover claim; how Ms Milonas initially hid her termination; changes to Ms Milonas’ personality, demeanour, mood, stress levels and family relations following to her termination, including with respect to difficulties in communication, understanding and memory; and the ongoing day-to-day support he has had to provide her since her termination.
[10]Dr Webster provided an expert opinion as to whether there were any reasonably practical steps for the industry within which Monash operated, particularly in or about 2013, to mitigate the risk of Ms Milonas suffering injury as alleged. Within this she was asked to consider (i) whether Monash’s actions, in the specific context which it was alleged they have occurred, were industry standard; (ii) whether they were reasonable in the circumstances; and (iii) Monash’s conduct. In addition, she was asked to consider any preventative actions, if any, which were open to Monash, given Ms Milonas’ work history.
On behalf of Monash, the following witnesses gave evidence:
•Mr Alfred Matthews, former Food Services Manager, Group Manager and Support Services Manager of Monash (the successor to Ms Unicomb);
•Ms Sharon McNulty, Director of Support Services of Monash;
•Ms Unicomb, former Group Manager of Monash (recalled);
•Mr Ryan Willmott, former Employee Relations Consultant at Monash; and
•Associate Professor Shashjit Varma, psychiatrist.
On 9 December 2022, the judge delivered reasons for judgment and gave judgment for Monash. His Honour made final orders on 12 and 16 December 2022.
Factual background — in precis
Ms Milonas was born on 30 April 1953 and commenced employment in the Food Services Department at Queen Victoria Hospital in about 1974.[11] There was no written contract.
[11]Ms Milonas’ evidence at trial was that she commenced in 1974, however it was not until September 1977 that her employment was confirmed. In May 1977, she was required to elect whether to be treated as a part-time employee with leave entitlements or continue or as a casual employee with loaded wages. She elected to continue as a casual employee.
In 1987, Ms Milonas’ employment was transferred to MMC where she worked as a ‘Food Services Assistant’ in the Food Services Department. She remained employed in this area, albeit in different positions, for the remainder of her employment. In this capacity at MMC, she usually worked the PM shift, a five-day week from 1:00 pm to 10:00 pm entitling her to penalty rates after 6:00 pm. Subsequently, her hours of work changed to cease at 9:00 pm.
In May 2001, Ms Milonas was promoted to ‘Food Services Assistant in Charge’, with a wage increase of 10 per cent. Her direct superior was the ‘Assistant Manager Food Services’.
Ms Eleanor Starkey was the Assistant Manager Food Services until October 2006. Her position was classified at grade NV1. Occasionally, Ms Milonas would relieve Ms Starkey when she was on leave and would perform the functions of Assistant Manager. When relieving Ms Starkey, Ms Milonas was responsible for duties involving the co-ordination of rosters and payroll, preparation of rosters, and checking timesheets of employees against rostered hours. This experience of higher level duties later qualified her for promotion.
In each period in which Ms Milonas performed the higher duties, she was paid at a higher classification and variation forms as to her duties and pay, were signed.[12]
[12]For example, Ms Milonas’ job classification and pay rate changed from FSA to FS1 (Food Services Officer) for the period 22 September 2003 to 13 October 2003.
When Ms Starkey’s employment with Monash ended in October 2006, the NV1 position was downgraded to an FS1 classification with a significant downgrade in pay, though no corresponding change in duties.
From 23 October 2006, Ms Milonas was temporarily appointed as the ‘Patient Meals Supervisor’, alternatively described as ‘Food Services Supervisor’ at the FS1 classification. Ms Milonas, on her estimate, managed about 70 staff and was responsible for staff replacement.
The hours of work as a Food Services Supervisor were from 9:00 am to 5:30 pm, Monday to Friday. As Ms Milonas was no longer working afternoon shifts and on weekends, she did not qualify for penalty rates applicable to her previous position. It was uncontroversial that this meant both a variation in her hours and a commensurate reduction in her remuneration. However, with Mr Sharma’s approval, she continued to submit timesheets which reflected her previous earnings on the PM shift with overtime.
On 15 January 2007, a variation form was signed by Mr Sharma and on 18 January 2007 by Mr John Sutherland, Finance Director, for Ms Milonas to continue in the Patient Meals Supervisor role.
Around this point, there is a significant conflict in the evidence which will be addressed in more detail later. It suffices to say that Ms Milonas and Mr Sharma said that, at a meeting between themselves and the then-Group Manager Food Services, Ms Unicomb, to whom Mr Sharma reported, it was agreed that Ms Milonas be paid at a different and higher rate based on her previous overtime PM wage rather than that applicable to her actual working times in order to reflect the fact that she was carrying out additional duties. The asserted agreement was to the effect that Ms Milonas would be permitted to submit false timesheets consistent with her former PM shift role which entitled her to overtime rates and to receive extra pay as she had before changing roles.
Ms Unicomb could not recall any such meeting and denied the existence of such an agreement.
The following is not in issue. From October 2006 to May 2013, Ms Milonas submitted false timesheets recording her hours of work as, typically, 1:00 pm to 9:30 pm, including on weekends (cf her actual working hours set out at [31] above). She was paid penalty rates in accordance with the hours recorded on the timesheets. Each of the timesheets submitted by Ms Milonas was approved by Mr Sharma.
Ms Unicomb left Monash’s employment in January 2007. She was replaced by Mr Alfred Matthews who commenced employment at MMC in February 2007. Mr Sharma did not inform Mr Matthews of the alleged salary maintenance agreement between himself, Ms Milonas and Ms Unicomb.
From 1 July 2007, Ms Milonas was permanently appointed to the role of Patient Meals Supervisor, consistent with a variation form signed on 17 July 2007 by Mr Sharma as ‘authorised manager’ and Mr Robert Klingwort as ‘next up manager’.
In late April 2013, two anonymous notices (‘the notices’) were placed on a noticeboard near the kitchen at MMC. The first was untitled and the parts relating to Ms Milonas read as follows:
This is to inform you about the corruption, bullying and malpractice in Food Services department. This matter requires urgent attention. The current Food service supervisor Vivienne Milonas was appointed as part time supervisor and part time Food services assistant. Though she lacked proper qualification she was chosen. But she continued her position as a full time supervisor. That position was not advertised as full time position. She was awarded the classification of FS1 with the pay of $961/wk, that is an increase of $226. Apart from this increase in salary she claims late shift penalty of $19.70 per day which amounts to $197 per fortnight although she never works from 9.30 am to 6pm. She works only Monday to Friday but she claims weekend penalty, giving herself day offs (sic) during the week, which accounts for 2 days wages for a fortnight which amounts to $404.65, and she also claims all the public holiday penalty though she stays at home.
Two of the assistant managers were given redundancy package to place her on top. As the Group Manager and the Food services Managers are corrupt and they use her to [do] their dirty job. As an assistant manager one would have earned only $1334.10, but as a supervisor she earns more than $1562.63 which is a secret payment. That’s why she never avails her ADO’s or annual leave, but she is paid for her annual leave whereas others are forced to take leave when they don’t want to take at that time.
She had reduced working hours of the staff in the pretext of saving money, leaving the kitchen as filthy as an Indian toilet, smelling, greasy and infested with cockroaches. If we were to send the photograph to the Health department of Monash City council, they would fine this place as it is a Class I facility providing food for the sick, old and children.
Our Groups Manager Alfred Matthews, has very little understanding of his role and often displays ignorance on matters that are brought up by staff. It is frustrating to deal with such people Arvind Sharma remains behind closed doors allowing Vivienne to be his mouthpiece to take his decisions.
Arvind and Vivienne had chosen new migrants from India, Srilanka (sic) and Asia to work as casual staff or as part timers and exploiting them by overloading them with various jobs. We were told that some were asked to work on Public holidays for 8 hours and paid only 4 hours wages (10 hours normal hours). Part time workers are not allowed to take any sick leave and they are not given a fixed roster to know when they are working or not. Sometimes they were asked to work more than 80 to 90 hours and they are paid only 76 hours a fortnight and promising them that she would fix their pay the following fortnight and this cycle goes on like this and they end up losing money. Fearing for their job, they are unable to question her.
Who has given Vivienne such power over kitchen staff, cooks, stores and menu monitors if not by Arvind Sharma and Alfred Matthews? They are all as thick as thieves and they work amicably to destroy the peace and unity of the staff which we enjoyed a long time ago.
Legally it is wrong to claim money when you stay at home (in case of any mishap, hospital is responsible). It is morally and legally wrong and misappropriation of time card and hospital funds should be checked. It is said that “the proof is in the pudding”
Don’t consider this as (sic) anonymous letter. If no action is taken the media will be informed for further investigation. She could not have done with without the support of the Manager.
The second was headed ‘Corruption in the Monash Health Centre Kitchen – Vol 2’ and the relevant parts read as follows:
There is a saying “If you pay peanuts, you get monkeys to work”. But Alfred and Arvind paying a donkey gold nuggets to do their dirty job. To keep their position they planned and plotted against Eleanor Starkey, Shobana Munasinghe and got rid of them as they were threat to them and knew about their malpractices in the kitchen. A person with dignity cannot work in the kitchen. Staff have no freedom to talk to each other and they have spies working for them. Each and every word is carried to them and the spies get favour from them. We don’t want to mention who they are. They talk to the staff as if they are on their side and next minute the news is conveyed to Vivienne and passed on to Arvind.
Let us come to the roster- Vivienne has 3 daily rosters, one displayed on the notice board, one in her office and one at home or she carries in her bag. This is how she does her business: she writes somebody’s name in the roster to start at 7 am, but she tells that person to start at 9 am. The in charge of that shift tells her that person has not turned up to work and she replies he/she is not answering the phone. But that person turns up to work at 9 am and when asked, he/she answers and says that Vivienne asked her/him to start at 9 am and not at 7 am as mentioned in the roster. This is a form of exploitation and bullying, causing other people to go through stress and ill feelings.
Following the display of the notices, enquiries in late April and early May 2013 were undertaken by Monash staff members and a formal investigation process into the conduct of Ms Milonas and Mr Sharma was implemented by Monash on about 8 May 2013. This was undertaken by Ms Sharon McNulty, Director of Support Services, in conjunction with Mr Ryan Willmott, Employee Relations Consultant.
We shall set out in more detail the process undertaken by Monash staff in investigating the claims which ultimately led to Ms Milonas’ dismissal. It suffices to say that on 20 May 2013 after a meeting with Monash staff Ms Milonas’ employment was terminated forthwith.
The judge’s reasons for dismissing the claims in contract and negligence — in precis
The judge examined the evidence of the three alleged participants to the salary maintenance agreement and the circumstances surrounding its alleged formation. He found that the alleged 2007 meeting did not occur and that the salary maintenance agreement did not exist.[13] His reasons for doing so are set out in detail at [66]–[67] below. In essence, his Honour accepted the evidence of Ms Unicomb and rejected that of Ms Milonas and Mr Sharma. The surrounding circumstances, his Honour concluded, made it highly improbable that the agreement involving the submission of false timesheets was ever entered into.
[13]Reasons, [87(a)–(b)].
The judge then determined that there was no duty of care owed by Monash to Ms Milonas in relation to the investigation and dismissal process. We have set out the basis for this conclusion at [139] below.
His Honour concluded that if he was wrong and even if a duty of care was imposed, he would still have determined that there was not a breach of duty as the investigation conducted by Monash accorded procedural fairness to Ms Milonas prior to her dismissal.[14]
[14]Reasons, [73], [75].
Next, the judge dealt with the argument as to the incorporation of the Code of Conduct and/or the EA into Ms Milonas’ contract of employment.[15] His Honour concluded that neither document was incorporated into the contract of employment as required by the principles enunciated in Lloyd v Healthscope Operations Pty Ltd[16] or Byrne v Australian Airlines Limited.[17]
[15]Reasons, [77]–[86].
[16][2021] VSCA 327, [90] (‘Lloyd’).
[17](1995) 185 CLR 410, 422 (‘Byrne’).
The judge summarised his conclusions as follows:
a)I find there was no meeting with Mr Sharma, Ms Unicomb and Ms Milonas to discuss the alleged agreement;
b)I find there was no alleged agreement;
c)I find the conduct of Ms Milonas in writing timesheets from 2007 to 2013 for hours she did not work constituted timesheet fraud which is serious and wilful misconduct;
d)There is no duty of care which arises in the form identified by the Plaintiff by reason of the decisions in Paige, Shaw and Govier;
e)Even if there was a duty of care capable of being imposed it should not be imposed given the failure to properly plead and particularise that duty and its content;
f)Alternatively, if a duty of care was imposed of the kind argued for by [Ms Milonas], that duty was discharged by reason of the investigation and termination of [Ms Milonas] carried out by Monash given:
i.the acceptance of the evidence of Ms McNulty and Mr Wilmott;
ii.the rejection of the evidence of Ms Milonas as to what had occurred;
iii.the factual finding that Ms Milonas had engaged in serious and wilful misconduct entitling Monash to summarily dismiss [Ms Milonas];
g)I find that the identified policies and procedures set out in the Code cannot be incorporated into the employment contract between Ms Milonas and Monash on the evidence in this case;
h)I find the EA, particularly clauses 125.6 and 77.5.1, cannot be incorporated into the employment contract between Ms Milonas and Monash on the evidence in this case and by reason of the application of principle in Byrne.[18]
[18]Reasons, [87] (citations omitted).
Proposed grounds of appeal
Ms Milonas’ proposed grounds of appeal are as follows:
1The trial Judge erred in failing to determine the case upon a consideration of the whole of the evidence and in particular:
(a)the evidence which established that at the time of trial Ms Milonas was suffering both psychiatric injury and cognitive impairment;
(b)in consequence of which, Ms Milonas’s evidence at trial was, as was submitted on her behalf, unreliable.
2The trial Judge failed to demonstrate an adequate process of reasoning in considering the medical evidence adduced at trial, in particular with respect to Ms Milonas’s psychiatric injury and cognitive impairment, in assessing the weight to be placed upon Ms Milonas’s evidence.
3The trial Judge erred, having failed to assess the Ms Milonas’s evidence upon a consideration of the whole of the evidence, in his use of the Ms Milonas’s evidence to undermine the evidence of her supervisor Arvind Sharma with respect to the discussions at and consequences of a meeting with Denese Unicomb in January 2007.
4The trial Judge erred in determining for himself, that Ms Milonas had falsified timesheets which constituted timesheet fraud in circumstances where the trial Judge had been requested not to determine that issue and the parties had not made submissions addressed to that issue.
5The trial Judge erred in failing to determine upon the whole of the evidence the terms of Ms Milonas’s contract of employment with Ms Milonas and whether that contract of employment had been breached by Ms Milonas.
6The trial Judge erred in failing to determine upon a consideration of the whole of the evidence the nature and scope of the duty of care owed by Monash to Ms Milonas and whether Ms Milonas had breached such duty of care.
Did the judge consider all of the evidence and, in particular, the evidence as to Ms Milonas’ psychiatric condition as being the cause of the inadequacies of her evidence and address its use in evaluating the evidence of other witnesses? (proposed grounds 1, 2 and 3)
The evidence relating to the alleged 2007 meeting and agreement
There were three accounts relevant to the alleged 2007 meeting: Ms Milonas’, Mr Sharma’s and Ms Unicomb’s.
In examination-in-chief, Ms Milonas said:
COUNSEL: What was done to get around the problem that working 9 to 5.30 didn’t give you any penalty hours of work?
MS MILONAS: The agreement was that I would get my penalty because they weren’t paying me as an assistant manager.
COUNSEL: And how was it agreed that you would get penalty pay?
MS MILONAS: Well, as it happened they took me into the office, Denese Unicomb was there and they said to me, “We don’t want you at these hours anymore, we want you to come into the morning and we want you to do these jobs now”. I said them, my first question was, “What are you going to pay me?”, and she said to me, “We will pay you 10 per cent”, that was 10 per cent back then. I said, “Well, it doesn’t suit me” because I was getting extra by working in the afternoon.
COUNSEL: So what was agreed?
MS MILONAS: “So continue writing up your timesheet as if you are getting penalties so that they can pay you as an assistant manager”.
COUNSEL: So from that time in 2007 until May 2013 did you complete timesheets which included penalty hours of work?
MS MILONAS: Yes, yes, so that it would cover my payment which was the agreement that we made, that was the agreement. Otherwise I would have refused, I wouldn’t do it. To do payroll for nothing, why would I do it?
It bears repeating that Mr Sharma was the Food Services Manager at Monash and oversaw food service operations. He was the direct superior of Ms Milonas.[19]
[19]He said that by Ms Milonas accepting the FSI position, she would lose at least ‘25, 22% of her take-home pay’.
In an affidavit sworn prior to the trial, Mr Sharma deposed to the meeting having occurred in June 2007. He said that both he and Ms Milonas were present in Ms Unicomb’s office at approximately 3.30 in the afternoon. He said:
It was verbally agreed between the three of us present, Vivian, Denese, and myself, that her pay would remain unchanged and she should continue receiving her afternoon shift penalties. This was to be achieved by Vivian continuing to complete her timesheets the way she had previously been doing so, reflecting afternoon hours worked, even though her hours were changing. She would therefore be paid as she previously had been. Denese did not mention that this arrangement may need to be approved by anybody else or that there was any chance of this arrangement being an issue.
At the trial, in his evidence-in-chief as to the detail of the alleged meeting with Ms Milonas and Ms Unicomb, the following exchange occurred:
COUNSEL: Yes, so what position was reached to avoid any financial loss being sustained?
MR SHARMA: It was proposed on the confirmation of her employment which was the last day of (indistinct) manager, it was proposed that Vivian Milonas would maintain her rostered times as per her last 25 years and be paid as per the award rate of her (indistinct).
COUNSEL: What did that mean in terms of completion cards indicating her hours of work and the like?
MR SHARMA: Yes, that she would continue to complete her card as she was completing for the last 25 years with the hours and the days she worked.
COUNSEL: Was that an idea which originated with Vivian Milonas herself?
MR SHARMA: It was worked by herself but it was considered – it was discussed in the meeting between Vivian Milonas, myself and the group manager of food services.
COUNSEL: Was the group manager Denese Unicomb?
MR SHARMA: Yes.
COUNSEL: And you were at that meeting?
MR SHARMA: Yes.
COUNSEL: And what was Denese Unicomb’s reaction to the suggestion made that the plaintiff should be compensated for any potential loss by continuing to complete her timecards in the manner she did for the previous 25 years?
MR SHARMA: She didn’t comment any other way.
COUNSEL: Did you form a belief as to whether she agreed with or objected in any way to the proposed arrangement?
MR SHARMA: I considered that she agreed to it, had she not agreed she would have suggested that no time altering be made.
COUNSEL: Was there any suggestion that what was proposed be reduced into writing?
MR SHARMA: No. Had there been a suitable classification available then we would have definitely considered that to be considered to compensate for the loss of income.
COUNSEL: So at the end of your meeting with the plaintiff, Denese Unicomb and yourself, what was your understanding as to what the plaintiff would in future do with respect to her time cards that would be submitted for payment by Monash Health?
MR SHARMA: That she would continue to complete her time cards as she had been completed for the last 25 years and her classification be changed to FS1 instead of the food services in charge with the variation form.
COUNSEL: Did Denese Unicomb express any disagreement with that proposal?
MR SHARMA: Not in the meeting at all.
COUNSEL: Did you have any impression one way or the other as to whether she understood what the proposal in fact meant?
MR SHARMA: No, but since the matter is convened, discussed, now I think that probably she didn’t understand what proposal (indistinct).
Subsequently, Mr Sharma signed off on Ms Milonas’ timesheets submitted to the Payroll Department. He confirmed that whilst Ms Milonas was in fact working from 9:30 am to 5:00 pm or 5:30 pm, the rosters and timesheet nominated her as working the PM shift, as she had in the past. In the course of the investigation in May 2013 into Ms Milonas’ salary, he described the alleged salary maintenance agreement as follows:
That she would maintain her current timesheet as a pm in charge and she had been putting for the last — that she had been doing for the last 25 years to be maintained an (sic) timesheet and be paid as FS1 which is a food services new classification.
In cross-examination, he said there was no discussion between himself and Ms Milonas prior to the meeting. Mr Sharma said that Ms Unicomb took a timesheet and made no response. Mr Sharma denied that the agreement to maintain her rate of pay was simply between himself and Ms Milonas. He said that there was never a written agreement with Ms Milonas, and no attempt was made to take advantage of the salary maintenance process. He accepted that at no time over the six years did he alert Mr Matthews, his manager, as to the existence of the arrangement, because it had already been put past Ms Unicomb.
Ms Unicomb said that she worked as a Group Manager of Food Services, for six months until January 2007. Mr Sharma reported to her. She had no recollection of any meeting with Mr Sharma and Ms Milonas.
She said, when provided with details of the alleged 2007 salary maintenance agreement, that she would not have agreed or instructed anyone to falsify a timesheet as ‘that would go against my principles and there is no way I’d put either the organisation, myself or the employee at risk by doing something like that’. The following exchange occurred in cross-examination by counsel for Ms Milonas (after she was recalled as a witness for Monash):
MS UNICOMB: As I have said before, if I had have understood I never would have agreed. If I hadn’t have understood what they were proposing I would have imagined that I would have said, if I was that rushed and finishing that day, look, leave the matter until the person replaces me and take the proposal to them, because the agreement on the bottom of that page that you were just reading from, it said it was from October or something like that, so it must have already been happening, is that correct?
COUNSEL: Yes?
MS UNICOMB: I have just read that. So I don’t understand why they would bring the proposal to me on my last day in the last hour and ask me to approve it if it was already happening and there was a variation in place that lasted for a couple of months after I was leaving. It doesn’t – there wouldn’t be any reason for me to approve it, but I can’t speak for what Arvind interpreted at the meeting because I don’t remember the meeting.
When asked about Mr Sharma’s evidence as to the arrangement in re-examination by counsel for Monash, the following exchange occurred:
COUNSEL: You have seen that, that it was his belief that the arrangement was that Mrs Milonas would just continue to write her old hours on the timesheet so she could get paid. In your years in health administration have you come across an arrangement of that sort before?
MS UNICOMB: Never.
Ms Unicomb also described other methods by which a variation to standard rates could be achieved, including an over award payment, or by way of salary maintenance agreement.
The medical evidence as to Ms Milonas psychological state at the time of trial
Dr Piperoglou, a psychiatrist, has treated Ms Milonas since 25 March 2019. He holds a post graduate qualification in ‘cognitive issues, memory and concentration problems in out-patients with residual anxiety and depression’ and his evidence was not relevantly the subject of challenge. In particular, he said of her cognitive state:
Major problems with her attention and concentration, her ability to remember questions and respond appropriately. She forgets things in mid sentence and goes off track. Her short-term memory when you ask her about recent events is not good and even her long term memory is vague and not good.
The doctor opined that such difficulties were compounded by chronic insomnia and ‘heightened levels of anxiety and depression requiring the administration of medication’ and that Ms Milonas remained ‘pre-occupied with the trauma she went through in the workplace which she feels is unjustified and she feels she was just booted out and thrown on the industrial scrap heap’. He diagnosed her as suffering ‘a major depressive disorder with anxiety features’.
Dr Piperoglou also said:
I am actually quite concerned about her cognitive issues and I should possibly send her for a neuropsychiatric evaluation to make sure that there is nothing more sinister going on.
Dr Vasudevan, Ms Milonas’ general practitioner since 1985 confirmed that Ms Milonas suffered an ongoing psychiatric condition without any improvement evidenced, and said that he had a suspicion that she was suffering cognitive impairment.
When asked about her mental state, he said:
I must say I have more recently, although looking at it one would say that I haven’t done much about it, but in my own mind I have a suspicion that cognitively she may be a bit impaired. Now, whether this chronic anxiety depressive condition is responsible for that, or whether there is something else that’s creeping up is something that I have made up my mind to investigate in the near future.
The consultant psychiatrist Dr Kaplan (called by Ms Milonas) examined Ms Milonas on four occasions between July 2019 and August 2022. He diagnosed Ms Milonas with a chronic adjustment disorder with mixed anxiety and depressed mood, with a differential diagnosis of chronic major depressive disorder. His reports recorded Ms Milonas’ subjective history of memory and concentration problems. He did not have any obvious concern regarding cognitive impairment.
The consultant psychiatrist Associate Professor Varma (called by Monash) examined Ms Milonas in December 2018 and January 2020. Ms Milonas told him that she was leading a close to normal life, and he opined that he expected her clinical course to be good and that she should be in remission once her case was over. He noted that she had a fixation and an obsession with her termination in 2013. Significantly, he could not elicit any definitive cognitive decline, save for her attention and concentration related to her preoccupation with what had occurred in 2013. In his January 2020 report, he commented that ‘[t]here was no other thought disorder or perceptual anomaly and her judgment and insight was intact’. He diagnosed an adjustment disorder with mild anxiety and stress. He also accepted that the treating practitioners were better positioned to assess Ms Milonas’ condition.
The judge’s reasons in relation to the occurrence of the alleged 2007 meeting
The judge concluded that there was no alleged salary maintenance agreement because:
(a)there were significant material differences in the evidence given by Ms Milonas and Mr Sharma as to the date and circumstances surrounding the meeting.[20] These were summarised by the judge as follows:
[20]Reasons, [15].
Initially [Ms Milonas] gave evidence that she, Mr Sharma and Ms Unicomb met and discussed the hours and penalty rates that she would receive if she took the new FS1 position. At that time she refused to work in the FS1 role because she would lose her penalties. She gave evidence that Ms Unicomb and Mr Sharma in that same meeting, then said to her that she could complete her timesheets so that she could continue receiving her penalty rates.
She alleged in her evidence that Ms Unicomb said she could “continue on with…[her]… old roster, the way…[she was]… paid before”.
However, in cross-examination she admitted her memory may not be accurate and it may not have been Ms Unicomb but another manager. She was emphatic, though, that when Ms Unicomb offered her the job she said she would not take it unless she got her penalties. She could not time the meeting to a specific date.
Mr Sharma, however, gave evidence that the meeting involved all three of them and occurred on the last day of Ms Unicomb’s employment. When he swore an Affidavit some three months prior to trial and gave evidence in chief, he timed this meeting to about June 2007. In cross-examination, Mr Sharma said that the proposal for Ms Milonas to falsely record time worked as evening shifts was suggested by him. However, he said that Ms Unicomb said nothing at all in the meeting about the Plaintiff’s wages. This point is of fundamental importance. Critically, Mr Sharma said as to Ms Unicomb’s agreement to the proposal:
Q: “She said nothing about timesheets or wages or anything else?
A: She didn’t say anything, yes.”
It is unclear how, on Ms Milonas’ evidence, Ms Unicomb discussed hours and penalty rates, and yet on Mr Sharma’s evidence she said nothing about this at all. I find this to be a very significant difference on a crucial part of the Plaintiff’s case. I find it weighs against her version of events.[21]
[21]Reasons, [15]–[19] (citations omitted).
(b)Ms Milonas voluntarily applied for the new position knowing full well that there would have been a reduction in her overall earnings. In making this finding, his Honour referred to the evidence of Ms McNulty that such a change from shift hours with penalty rates to daytime office hours would result in a reduction of pay was well recognised fact, and to the principle in Fox v Percy that it is preferable to rely on ‘contemporary materials, objectively established facts and the apparent logic of events’ to explain patterns of behaviour;[22]
[22]Reasons, [20]–[22], citing Fox v Percy (2003) 214 CLR 118, 129 [31] (Gleeson CJ, Gummow and Kirby JJ).
(c)Ms Unicomb could not recall Ms Milonas and said that she would never have entered into such an agreement. The judge formed the view that she was ‘very knowledgeable and capable’ and regarded her as a witness of truth, whose evidence was to be preferred over that of Ms Milonas and Mr Sharma.[23] Ms Unicomb gave a number of reasons why, as an experienced manager, she would not have agreed to the alleged agreement, which the judge accepted on the basis that:
[23]Reasons, [23].
(i)such an arrangement could have been made via existing processes known as a ‘salary maintenance agreement’ (‘SMA’) or an ‘over-award payment’ which are both written forms of agreement which allow a set amount to be paid in addition to base salary;[24]
[24]Reasons, [24].
(ii) the alleged agreement would require Ms Milonas to falsify timesheets and Ms Unicomb had never seen an arrangement where such falsification was accepted. This would go against both policy and practice;[25] and
[25]Reasons, [24].
(iii) the risk an agreement such as that alleged would pose to the organisation, and that it ran contrary to competent management;[26]
[26]Reasons, [26].
(d)as Ms Unicomb said in cross-examination, there was no reason for her to rush through the agreement in January 2007, given Ms Milonas was assured of her position until June 2007 by way of variation agreement. The judge found this also suggested the meeting did not occur. In this regard, the judge referred to the ‘clear and rational way’ Ms Unicomb responded in cross-examination to a version of events constructed from Mr Sharma’s evidence — that Mr Sharma put the proposal to her and she did not express disagreement which he then interpreted as agreement. She said that if she had not understood, she would have simply left the issue to be decided by the next Group Services Manager as the issue was neither urgent nor a loose end as there was a variation agreement allowing Ms Milonas to act in the FS1 role until 30 June 2007, some six months away;[27]
[27]Reasons, [27].
(e)the judge also found that the signing of the variation form in July 2007 also ‘tells strongly’ against Ms Milonas’ case, on the basis that it does not accord with the date of the alleged meeting with Ms Unicomb in January 2007. No explanation was provided as to why, upon reaching an agreement over the proposed terms for Ms Milonas to take on the FS1 role in January 2007 on the basis of the alleged salary maintenance agreement, it took six months for Mr Sharma to sign the variation form. Further, the fact that Mr Sharma and Ms Milonas subsequently signed the variation form showed that they were both cognisant of the need to document the change in accordance with the policy and procedure expected by Monash to authorise payments;[28]
[28]Reasons, [28]–[30].
(f)the judge accepted that Ms Unicomb’s evidence on this point was bolstered by the fact that all the witnesses who worked at Monash in 2007 accepted that timesheets were legal documents which had to be correct and should not be falsified. This supported the fact that not only was this policy, it was also accepted practice that was not deviated from. The judge noted Ms Milonas’ evidence that when she accepted the role as Food Services Assistant in Charge she diligently ensured the accuracy of other employees’ timesheets;[29]
(g)contrary to SMAs or over-award payments (both of which, according to Ms Unicomb and Ms McNulty, were well known in the health industry), the alleged agreement was wholly oral and was not for a set amount, rather it depended on the times and shifts Ms Milonas falsely entered on her timesheet which varied week to week;[30]
(h)Mr Sharma and Ms Milonas were very experienced health workers who knew hospital processes at Monash and had, in the past, completed variation forms. They were cognisant of the need to document changes in pay in accordance with the policy and procedures expected by Monash to authorise payments. Ms Milonas herself gave evidence that in her role as supervisor she diligently checked timesheets for accuracy;[31]
(i)there was no logical reason why such a unique agreement would not be written down, especially when Mr Sharma had signed variations in circumstances where Ms Milonas was acting in higher positions for a few weeks (as in 2003 or 2005), and he believed it was properly authorised by his manager, Ms Unicomb;[32]
(j)not one witness could recall such an oral agreement being in place previously despite all their years of experience at Monash (Ms Milonas, 36 years; Mr Sharma, 11 years; Mr Matthews, 7 years; and Ms McNulty, over 20 years);[33]
(k)while it was suggested Mr Sharma was not procedurally obligated to advise his manager of staff pay changes, his Honour found it made ‘no sense’ why he never mentioned such a unique oral agreement to anyone, particularly Mr Matthews who replaced Ms Unicomb in 2007, and that his failure to do so was ‘completely inconsistent with his training, experience and the expectations of him as a competent manager’;[34]
(l)Ms Milonas’ late evidence that she had had a similar agreement with Ms Starkey (whom she did not call) and that the alleged agreement was made public at a ‘meeting with all the workers’, which the judge found to be inventions at Reasons, [35] and [39] respectively;[35]
(m)the stated aim of the agreement was maintenance of Ms Milonas’ salary, however the reality was a substantial increase in her salary — it was not a set amount but rather varied depending on what shifts were written on each timesheet, and what rates applied to those shifts. The judge also referred to an example of Ms Milonas claiming annual leave for weekend work, which indicated that ‘the timesheets were being manipulated to very significantly increase Ms Milonas’ wage’;[36]
(n)Ms Milonas’ evidence was inconsistent and unreliable. His Honour found that she was ‘a very difficult witness to follow’ and he ‘could not rely on her evidence other than on the most basic, non-controversial matters’;[37] and
(o)Mr Sharma’s evidence was inconsistent with both policy and practice and for a manager of his skills and experience, could not be reconciled with the terms of the alleged agreement. His Honour further could not reconcile inconsistencies as to the dates Mr Sharma stated the alleged agreement was made in his affidavit and oral evidence, with the date of Ms Unicomb’s departure, and found that overall he could not rely on his evidence.[38]
[29]Reasons, [25].
[30]Reasons, [24].
[31]Reasons, [28]–[31].
[32]Reasons, [33].
[33]Reasons, [32].
[34]Reasons, [34].
[35]See Reasons, [35]–[39].
[36]Reasons, [40]–[41].
[37]Reasons, [43]. See also, Reasons, [17], [35].
[38]Reasons, [44].
At paragraphs [43]–[44] of the Reasons, as to the alleged salary maintenance agreement, the judge said of the credibility of Ms Milonas and Mr Sharma:
In coming to that finding [that there has been timesheet fraud given there was no alleged agreement], it is also clear that I consider that the evidence of Ms Milonas was inconsistent and unreliable. To this I would add that I found her a very difficult witness to follow. I had to repeatedly ask her to directly answer questions. However, the medical evidence suggests that psychologically she has fixated on the alleged agreement and her treatment. The evidence of Associate Professor Shashjit Varma was that this fixation has led to her not properly focusing on questions, and rather reverting at all times to the alleged agreement. The lay witness Mr Goutzamanis gave very similar evidence about noticing this feature of her presentation in 2018. Taking into account that medical evidence and accepting the lay evidence that such is a feature of her psychological condition, I put to one side my perception of her as an unhelpful witness while giving evidence. Rather, focusing attention on the inconsistencies and the unreliability of her evidence, and the instances of very lately announced matters referred to above, I overall find that I cannot rely on her evidence other than on the most basic, non-controversial matters.
Mr Sharma gave evidence over an extended period. I consider that he was a witness who gave evidence in a manner which sought to be helpful, and he gave considered answers. However, when examined closely, his evidence is inconsistent with both policy and practice at Monash. For a manager of his skills and experience, it cannot be reconciled with the terms of the alleged agreement. Further, I cannot reconcile the inconsistencies between the dates he states that the alleged agreement occurred in his Affidavit, the dates he provides in his viva voce evidence, and the fact of Ms Unicomb’s departure having occurred in early 2007. Overall, I am unable to rely on his evidence.[39]
Analysis
[39]Citations omitted.
The submission made on behalf of Ms Milonas under these proposed grounds was as follows:
The applicant’s evidence should not have been relied upon by the trial judge to undermine her case at trial, particularly in circumstances where the reasons for judgment abrogated the obligation to assess the underlying medical evidence relevant to the issue.
Simplified, counsel’s argument appears to be that the judge did not give sufficient weight to Ms Milonas’ psychiatric condition and cognitive functioning at the time of trial in assessing her evidence, and as a result, gave her evidence too much weight in resolving the contest between Mr Sharma’s account of the alleged 2007 meeting and that of Ms Unicomb.
Counsel did not attack the judge’s findings as to the inadequacies and inconsistencies in Ms Milonas’ evidence including in relation to the alleged 2007 meeting (with the resultant alleged salary maintenance agreement). To the contrary, the inconsistencies in her evidence were said to have been amplified by her psychological impairment and accordingly, the need, in effect, for her evidence — which counsel characterised on the hearing of the application as ‘a complete jumble’ and ‘not the evidence of a person who was in control … of their mental faculties’ — to be quarantined.
It was submitted that the evidence concerning Ms Milonas’ psychiatric and cognitive status was compelling and that the judge was bound to consider such evidence which was pivotal in determining the weight to be attached to Ms Milonas’ evidence at trial.
Counsel for Ms Milonas relied upon a statement made by this Court in Stevens v DP World Melbourne Ltd:
The need to examine all the evidence is a fundamental obligation of a trier of fact (be it judge or jury). This was particularly so in this case where there was a ‘question mark’ over the Plaintiff’s psychiatric state and her ability to provide an accurate account of workplace events.[40]
[40][2022] VSCA 285, [45] (Beach, Macaulay JJA and J Forrest AJA) (‘Stevens’).
In particular, counsel relied on the following statement from Stevens as being ‘particularly apposite’:
Finally on the question of the credit of the plaintiff, we note that this was a case where, as his Honour said, there was a consensus of medical opinion that the plaintiff had suffered a mental injury that arose out of his employment. In such circumstances, it is not clear why his Honour did not consider the possibility that any exaggeration, or lack of reliability in the plaintiff’s evidence, might have been the product of the mental injury that arose in the course of the plaintiff’s employment. A hallmark of cases of the present kind is that the evidence given by a plaintiff with a mental injury is often affected by the condition from which the plaintiff is suffering (and sometimes in critical respects). For that reason, such evidence may be less reliable than evidence that might be given in another case by a person in normal mental health. Allowances need to be made for such a possibility (albeit that, upon proper examination, such an allowance might be discounted in an individual case). Where there is a medical condition which might affect the way in which a witness might give his or her evidence, a court does not merely reject that witness’s evidence because of what is said to be his or her unreliability: a court is duty bound to consider what the balance of the evidence discloses, even if the witness’s evidence cannot be accepted on its own. At the very least the judge should have analysed the effect of the plaintiff’s mental injury (about which there was a consensus of medical opinion), upon the reliability of the plaintiff’s evidence, before concluding that he was a dishonest witness who fabricated critical parts of his evidence.[41]
[41]Ibid [44] (citations omitted).
Counsel argued that the judge failed to consider all of the evidence as to Ms Milonas’ psychiatric condition and cognitive state, and in particular, that of Ms Milonas’ treating psychiatrist (Dr Piperoglou, whose evidence counsel submitted should have been the starting point for a consideration of Ms Milonas’ evidence), treating general practitioner (Dr Vaseudevan), and consultant psychiatrist (Dr Kaplan) — extracted above. It was noted that the only evidence of a medical practitioner referred to in the reasons for judgment was that of Associate Professor Varma, the sole medical witness called on behalf of Monash which it was said did not contradict the medical evidence called by Ms Milonas.
It was then contended that:
(a)the impression to be gleaned from the overall tenet of Ms Milonas’ evidence was of a person in significant cognitive decline which amplified her underlying psychiatric condition;
(b)there was a clear consensus of medical opinion on this issue;
(c)in failing to consider the evidence as to Ms Milonas’ psychiatric and cognitive state, the trial judge failed to demonstrate an adequate process of reasoning in assessing the weight being attached to her evidence;
(d)the evidence of disability under which Ms Milonas suffered is evident from any reading of her evidence;[42]
(e)Ms Milonas’ evidence should not have been relied upon by the trial judge to undermine her case at trial, particularly in circumstances where the reasons for judgment abrogated the obligation to assess the underlying medical evidence relevant to the issue; and
(f)in failing to assess the evidence identified, and in failing to address the submission advanced on behalf of Ms Milonas at trial as to her unreliability, the trial judge ‘has failed to use or has palpably misused his advantage’[43], in circumstances where other evidence rendered Ms Milonas’ evidence ‘glaringly improbable’.[44]
[42]In this regard, counsel gave a number of examples including Ms Milonas’ inability to recall the interview on 16 May 2013 or the receiving of documents requesting her to attend that interview; her conflating of the interview process to a single event ‘where she was frog marched out of her workplace of almost 40 years’; and her repeated denial of submitting a compensation claim.
[43]Citing SS Hontestroom v Sagaporack [1927] AC 37, 47.
[44]Citing Brunskill v Sovereign Marine and General Insurance Co Ltd (1985) 59 ALJR 842, 844, cases subsequently referred with approval: Devries v Australian National Railways Commission (1993) 177 CLR 472, 479; Fox v Percy (2003) 214 CLR 118, 127 [26].
Finally, counsel made a separate complaint as to the judge’s conduct of the trial: that it was conducted in an unfair manner by the judge requiring Ms Milonas to give evidence from 9:15 am until approximately 4:00 pm over a number of days, despite objections being repeatedly taken to the long sitting hours of the court.
Monash in response argued as follows.
(a)While Ms Milonas’ psychiatric illness might have resulted in some impairment to her memory and concentration, there was no consensus in the medical evidence about the extent of that impairment and neither of Ms Milonas’ treating doctors had been sufficiently concerned about her cognition at any time before the trial to recommend that she undergo formal neuropsychological testing.
(b)Both Associate Professor Varma and Dr Kaplan attributed Ms Milonas’ reported difficulties with her memory and concentration to her preoccupation with the events of May 2013. According to Dr Kaplan, ‘[t]he problem was actually one of attention.’ He said that it was common for patients with depression or anxiety to be distracted by their thoughts and feelings to such an extent that they would form no memories of whatever tasks they had been performing. Their inability to recall those tasks at some later time would be experienced as ‘forgetfulness’.
(c)There was no evidence that Ms Milonas’ psychiatric illness caused her to invent things that were untrue. She was not suffering from delusions or fantasies. Both Associate Professor Varma and Dr Kaplan considered that — apart from her preoccupied thought content — she was not affected by any other abnormalities of speech, thinking or perception. Both doctors also considered that her insight was intact.
(d)Ms Milonas’ preoccupation with the alleged agreement and the events of May 2013, did not mean that the trial judge could ignore what she said about those matters. In particular, there was nothing in the medical evidence that was inconsistent with his Honour’s findings at [35] and [39] that Ms Milonas had invented evidence in an attempt to sway the court to accept her claim — summarised at [66(a)] above.
(e)The trial judge’s finding at [43] that he ‘[could not] rely on her evidence other than on the most basic, non-controversial matters’ clearly reflected her counsel’s concession that she was an unreliable although honest witness.
(f)The judge, twice in the course of his Reasons at [43] and [62], explicitly demonstrated that he had taken into account the medical evidence about the effect of Ms Milonas’ psychiatric illness on the manner in which she gave evidence in court.
Counsel for Ms Milonas is correct in three of the assertions made in relation to the evidence of Ms Milonas:
(a)it was apparent that her answers to a number of questions either in examination-in-chief or in cross-examination were nonsensical and patently inconsistent with someone who had, in the past, managed large numbers of staff;
(b)there was a body of medical evidence apart from Associate Professor Varma, including from her two treating practitioners, which identified that Ms Milonas was suffering from a significant mental health condition which may have impaired her cognitive function. At the very least it was clear that she had become fixated with the events surrounding her dismissal and her perception of them; and
(c)that it was necessary to treat her evidence cautiously in assessing the quality of the evidence of the other witnesses and, in particular, Mr Sharma. Of course, that does not exclude the possibility that Ms Milonas on occasions was deliberately not telling the truth, however the medical evidence was of sufficient force to require the judge to ensure that he examined the other evidence surrounding the alleged salary maintenance agreement carefully.
However, and allowing for each of these matters, for the following reasons we can see no error in the judge’s conclusion as to what did or did not occur at the 2007 meeting.
First, Ms Milonas carried the burden of proof in establishing the existence of the salary maintenance agreement. In essence, the effect of her case was that she, Mr Sharma and Ms Unicomb had entered into a conspiracy to defraud Monash by submitting false timesheets to facilitate wage fraud. On any view, this required the application of s 140(2) of the Evidence Act 2008 with a rigid examination of the disputed facts and surrounding circumstances — which was undertaken by the judge.[45]
[45]Section 140(2) provides:
Second, contrary to Ms Milonas’ submissions, the judge clearly recognised that the failings in her evidence may be explained not by mendacity but by her psychological state. At [43], in making findings about the alleged salary maintenance agreement, the judge specifically referred to her psychological condition (and the evidence of Associate Professor Varma and her cousin, Mr Goutzamanis) as providing the basis for his finding that her evidence was inconsistent and unreliable. His Honour specifically said that he put to one side his perception that Ms Milonas was an ‘unhelpful witness’.[46] Reference to the evidence of Associate Professor Varma to ‘which [the judge had] previously referred to’ in [43], was made again at [62] in the course of his Honour making findings as to what occurred in the course of the investigation process in May 2013.
[46]Reasons, [43].
Third, in any event, on this application the level of Ms Milonas’ cognitive and psychological impairment was inflated. For instance, under proposed ground four it is said that Ms Milonas was suffering ‘both psychiatric injury and cognitive deficit which severely inhibited her ability to give cogent or reliable evidence’.[47] There was not a scintilla of evidence that Ms Milonas’ capacity to give reliable evidence was ‘severely inhibited’. Whilst it is true that she was diagnosed as suffering from major depressive disorder and possible cognitive impairment, the question of the connection between those conditions and her ability to give honest or reliable evidence was not adequately extracted in the course of the trial. Her counsel did not ask any questions directly of the medical practitioners as to whether this condition could lead to her not just ‘forgetting things’ and ‘going off track’ (as her treating psychiatrist noted), as opposed to a patient who was incapable of giving credible evidence. Moreover, the general picture appears to be of a person who was fixated with the events surrounding her termination in 2013. But whether that fixation in any way impaired her long-term recollection of what happened in January 2007 was not explored in evidence.
[47]Emphasis added.
Whilst we accept that the judge’s analysis of the evidence as to the psychological or cognitive impairment of Ms Milonas and her capacity to give credible testimony (and the consequential effect upon acceptance of Mr Sharma’s evidence) is limited when the evidence as to Ms Milonas’ mental state is reviewed (as we have done), we can detect no error in his Honour’s analysis. The medical evidence was equivocal as to the true extent of any cognitive impairment affecting Ms Milonas’ capacity to give credible testimony.
The existence of mental health issues affecting Ms Milonas’ memory and concentration, and the risk of some cognitive deficit, as we have already noted, needed to be taken into account by the judge (as he did), but that was not determinative of his assessment of her case. Rather, as the extract from Stevens[48] demonstrates, it was necessary for the judge to examine all the other pieces of the evidence to see whether her case was made out — this the judge did in considerable detail as set out at [66] above. His Honour’s list of the other factors that drove him to the finding that Ms Milonas had not established the existence of the salary maintenance agreement is convincing.
[48][2022] VSCA 285.
Fourth, and contrary to the submission on behalf of Ms Milonas, the judge did not reject Mr Sharma’s evidence on the basis that it was ‘undermined’ by the evidence of Ms Milonas. To the contrary, at Reasons [43]–[44], set out at [67] above, the judge made it clear that Mr Sharma’s evidence was rejected on the basis that it was inconsistent ‘with both policy and practice at Monash’, and with internal inconsistencies in his own account as to the date upon which the alleged arrangement was entered into with Ms Unicomb. Moreover, as we have mentioned, the judge, consistent with Stevens, specifically referred to putting Ms Milonas’ evidence to one side in determining the cogency of Mr Sharma’s evidence.
In any event, by extracting Ms Milonas’ testimony from the evidentiary picture, the judge was required to evaluate the conflicting versions of Mr Sharma and Ms Unicomb as to the circumstances surrounding the formation of the alleged salary maintenance agreement. But it was not just word against word — it was necessary to consider all the surrounding circumstances in determining the probability of the existence of such an agreement — as the judge recognised and applied.
True it is that the judge does identify an inconsistency between the evidence of Ms Milonas and Mr Sharma which he found to be ‘very significant’[49] as to the content of the discussion between the three participants. However, and notwithstanding the terminology used by his Honour, this was only a small part of his reasoning which identifies a multitude of other factors which tell against acceptance of Mr Sharma’s account.
[49]See Reasons, [19] set out at [66(a)] above.
The judge, in concluding that Ms Milonas had not established the probability of the existence of the salary maintenance agreement, identified in a clear and precise way an array of factors which underpinned his conclusion — set out at [66] above — several of which are worth repeating:
(a)Mr Sharma’s account of the meeting was dubious in terms of both date and substance;[50]
(b)Ms Milonas would have known that by moving into management and off shift work that there would be a commensurate reduction in earnings[51] — and that any expectation of retaining shift work allowances with a person so experienced as Ms Milonas was improbable;[52]
(c)there were other processes available which could have partially, if not totally, ameliorated the wage differential (eg a salary maintenance agreement or an over-award payment) and which could have been discussed with Monash management;[53]
(d)the purported arrangement was, in essence, fraudulent, and it would be highly unlikely that a senior Monash manager would enter into such an arrangement;[54]
(e)at no time over six years did Mr Sharma mention the existence of the alleged agreement to his superior, Mr Matthews (who had replaced Ms Unicomb);[55] and
(f)on other occasions, Mr Sharma and Ms Milonas (both experienced managers) would enter into written salary variation agreements which formed part of Monash’s records.[56]
[50]Reasons, [18].
[51]Reasons, [21].
[52]Reasons, [22].
[53]Reasons, [24].
[54]Reasons, [31].
[55]Reasons, [34].
[56]Reasons, [33].
Contrary to the submission made by counsel for Ms Milonas, the judge conducted exactly the exercise which Stevens requires: Ms Milonas’ case failed, not because of her own unreliability, but because, as we have explained, neither the surrounding circumstances nor the oral evidence of Mr Sharma, when balanced against that of Ms Unicomb and when viewed in the context of Monash’s practices, were persuasive.
Fifth, the judge had the opportunity to observe each of the witnesses and analyse their evidence in the light of the contemporaneous materials and evidence as to Monash’s practices. He did so methodically and rationally. Ultimately, his Honour accepted the evidence of Ms Unicomb, which he regarded as reliable — ‘a witness of truth’.[57] Although she could not remember the meeting, Ms Unicomb gave a number of powerful reasons for stating that she would never have entered into such a deal. Not only were there processes which may have overcome the difficulty posed by the reclassification, the concept of falsifying timesheets was entirely inconsistent with the way in which she worked and the way in which Monash operated.[58] It posed a risk not only to her, but also reputationally to the organisation.[59] Further, the issue of Ms Milonas’ remuneration at the time of Ms Unicomb’s departure in January 2007, was neither urgent nor a loose end because there was already a variation agreement allowing Ms Milonas to act in the FS1 role until 30 June 2007.[60]
[57]Reasons, [23].
[58]Reasons, [24]–[25].
[59]Reasons, [26].
[60]Reasons, [27].
The submission of counsel for Ms Milonas that Ms Unicomb ‘did not provide any evidence which contradicted the evidence of [Ms Milonas] or Mr Sharma on this point’ is, simply put, wrong. Whilst Ms Unicomb had no recollection of such a meeting, she was adamant that this type of arrangement would not have been entered into for the reasons that she set out, and that the judge accepted. Her rationale for denying that she would ever have agreed to such an arrangement was, as the judge found, compelling.
His Honour had the advantage of seeing both Mr Sharma and Ms Unicomb. He did not believe Mr Sharma and he accepted Ms Unicomb, and found a number of objective matters that supported her account. In addition, the lack of documentary evidence from a workplace such as Monash gives support to, rather than detracts from, an acceptance of Ms Unicomb’s account. There is no other evidence that makes the judge’s findings ‘glaringly improbable’ or ‘contrary to compelling inferences’.[61]
[61]Fox v Percy (2003) 214 CLR 118, 129 [29] (Gleeson CJ, Gummow and Kirby JJ); Lee v Lee (2019) 266 CLR 129, 148–9 [55] (Bell, Gageler, Nettle and Edelman JJ); Robinson Helicopter Company Inc v McDermott (2016) 331 ALR 550, 558 [43] (French CJ, Bell, Keane, Nettle and Gordon JJ).
There are two other matters we should address. Subject to what we have just said about the judge’s limited analysis of the medical evidence, the attack on the judge’s process of reasoning (proposed ground 3) is unsustainable. And, as we have said, ultimately the cognitive and psychological impairment point is a sideshow. When examined objectively, the judge’s reasons explain lucidly and in detail why he rejected the case of Ms Milonas on this issue.
Similarly, the complaint that Ms Milonas’ testimony was in some way prejudiced by his Honour’s sitting hours is without foundation. There were regular breaks during the time she gave evidence and the judge delayed commencement of the trial on the first day to accommodate counsel conferring with his client. Indeed, the only contemporaneous complaint voiced to the judge about the sitting times was that of Ms Milonas’ counsel and related solely to his convenience. Further, the parts of Dr Piperoglou’s evidence relied upon by counsel for Ms Milonas (as a result of his questioning) as giving support for this proposed ground did not provide a full picture. Dr Piperoglou was not made aware of the breaks provided by the judge and was asked only to opine on whether the sitting hours would impact Ms Milonas’ capacity to give evidence ‘in a cogent and coherent fashion’.
Unlike the situation in Vision Australia, there was nothing in the evidence (either documentary — of which there was none — or oral) to suggest that the terms of either the Code of Conduct or the EA were incorporated into the contract of employment.
The judge received no assistance from Ms Milonas’ counsel as to how this part of her case could be maintained. Mere reference to the relevant parts of the two documents accompanied by a bald assertion as to incorporation in the contract of employment was next to useless.
In these circumstances, where no evidentiary basis for incorporation could be identified, his Honour was clearly correct to find that none of the criteria set out in Lloyd as to incorporation of the provisions of the Code of Conduct and/or the EA in her contract of employment were made out by Ms Milonas.
This proposed ground fails.
The judge’s conclusion as to the nature and scope of the duty of care owed by Monash to Ms Milonas and whether it had been breached (proposed ground 6)
We have set out the evidence relevant to the conduct of the investigation at [111]–[119] above.
The judge’s reasons in respect of duty of care and breach in the conduct of the May 2013 investigation process
The judge made the following findings of fact.
As to the 16 May 2013 meeting, the judge accepted the evidence of Ms McNulty over that of Ms Milonas and found that, as foreshadowed in the letter and recorded in the record of interview, the meeting between Ms Milonas, Ms McNulty and Mr Willmott occurred on that day.[74] His Honour also found that the record of the interview[75] (set out at [115] above) accurately recorded the content and conduct of that meeting.[76]
[74]See Reasons, [52]–[53].
[75]Reasons, [53].
[76]Reasons, [61].
As to the 20 May 2013 meeting, his Honour rejected the evidence of Ms Milonas. He again accepted the evidence of Ms McNulty and Mr Wilmott. He also accepted that the record of this meeting (set out at [118] above) was accurate. The judge made the following findings:
Specifically, I find that, at the meeting on 20 May 2013, Ms Fegan was present as a representative of Ms Milonas. I find that the meeting occurred in Ms McNulty’s office with Ms Fegan, Ms Milonas, Ms McNulty and Mr Willmott. I find that Ms Milonas did not present any further evidence to support the alleged agreement or to deal with the allegations made against her. I find that Ms McNulty and Mr Willmott explained to Ms Milonas the findings of their investigations, and the fact that they considered timesheet fraud had occurred. I find they informed her, at that time, that she would be terminated for serious and wilful misconduct based on the timesheet fraud. I find that they applied the balance of probabilities to the Briginshaw standard in making their assessment. As a result of this, Ms Milonas was visibly upset and Mr Alfred Matthews was called to come and collect her. He did so and she was escorted to her office. In fact, this is a further matter which tells against acceptance of the Plaintiff’s evidence. Mr Matthews’ evidence was that he escorted Ms Milonas to her office to collect her things. He said this was done in an unhurried manner and he gave her what time she needed. This stands in contrast to the Plaintiff’s evidence, which was that she was told to get out and could not even collect her things.[77]
[77]Reasons, [62].
The judge then turned to the question of the existence of duty. He noted that counsel for Ms Milonas framed the duty in the following way in the closing written submissions: ‘[Did Monash owe a] duty of care to provide a safe system of work in the undertaking of the investigation into alleged misconduct by the Plaintiff’.[78] His Honour also observed that the second amended statement of claim was silent as to a specific formulation of the duty.[79]
[78]Reasons, [64].
[79]Reasons, [65].
At this level, his Honour considered that the claim failed because it was incumbent upon Ms Milonas to identify the content of the duty and the plaintiff had not adequately identified the duty of care with the specificity required in either in the pleadings or in submissions.[80]
[80]Reasons, [72] citing Irving & Ors v Kleinman [2005] NSWCA 116, [31].
Notwithstanding this finding, the judge concluded that there was no duty of care owed by Monash to Ms Milonas in relation to the investigation and dismissal process because:
(a)this would require an ‘impermissible extension of the duty owed by an employer to cover the area of the investigation of potential disciplinary matters’ and he was bound by authority[81] — specifically, the decisions of superior courts in State of NSW v Paige (‘Paige’),[82] Shaw v State of NSW (‘Shaw’),[83] and Govier v The Uniting Church in Australia Property Trust (Q) (‘Govier’);[84]
(b)it would offend the principles in Sullivan v Moody as to the incompatibility of the alleged duty with other duties owed by Monash.[85] This would result in the application of new principles of negligence in an established area of employment law, namely unfair dismissal. His Honour noted that if Parliament intended for such issues to be determined by employment law tribunals and decision makers, it would be incoherent with principles of employment law for other courts to interfere with the intended source of this decision-making power by the imposition of a duty of care in tort;[86] and
(c)there would be a further conflict between the objectives of the Health Services Act 1988 under which Monash is established, that public hospitals are governed and managed effectively, efficiently and economically and the proposed duty to provide a safe system of work in undertaking workplace investigations.[87]
[81]See Reasons, [67]–[69].
[82](2002) 60 NSWLR 371 (‘Paige’).
[83][2012] NSWCA 102.
[84][2017] QCA 12.
[85]Reasons, [70] citing Sullivan v Moody (2001) 207 CLR 562, 581 [55] (‘Sullivan’).
[86]Reasons, [70] citing Paige (2002) 60 NSWLR 371, 394–400 [123]–[155] (Spigelman CJ).
[87]Reasons, [71]. The judge gave the example of a case of prima facie evidence of fraud, still requiring the expenditure of funds to undertake investigative and disciplinary procedures to the standard submitted by Ms Milonas before reaching a decision to terminate, and noted that the court in Sullivan (at [59]) pointed out that such a conflict should ordinarily be avoided.
In any event, his Honour said that if he was wrong and if a duty of care was imposed, he would still have determined that there was not a breach of duty as the investigation conducted by Monash accorded procedural fairness to Ms Milonas prior to her dismissal.[88] In particular, his Honour noted the following by way of ‘sufficient’ steps in the investigation process:
•Ms Milonas was notified by Ms McNulty of the allegations both orally and in writing on 14 May 2013;
•there was notice of the procedure to be followed in the investigation in the letter dated 14 May 2013 and its attachments provided to her on that date;
•there was a meeting on 16 May 2013 when Ms Milonas was asked for her version of events and to provide any materials;
•as a corollary, there was investigation of her HR file, and of Mr Matthews, Ms Unicomb and Mr Sharma;
•there was a further meeting on 20 May 2013 with an independent person present, namely Ms Fegan; and
•at that meeting, further information was requested from Ms Milonas, and with none forthcoming, she was terminated.[89]
[88]Reasons, [73], [75].
[89]Reasons, [73].
In making his findings, the judge found that the opinion of Dr Webster was of ‘no use’ as it was based on an incorrect factual basis — namely Ms Milonas’ instructions.[90]
[90]Reasons, [74].
Further, his Honour made the point that even if Monash had conducted an investigation process in a manner consistent with that contended for by Ms Milonas as according procedural fairness, she had not demonstrated how this would have led to a different outcome: the judge found that Ms Milonas unjustly enriched herself and she would have been dismissed.[91]
Analysis
[91]Reasons, [76].
His Honour delivered judgment on 9 December 2022 and, in rejecting the proposition that that Monash owed Ms Milonas a duty of care in undertaking the investigation into her alleged misconduct, relied upon ‘numerous decisions of superior courts’.[92] He referred in particular to Paige, Shaw, and Govier.
[92]Reasons, [67].
On the same day, the Queensland Court of Appeal, in Potter v Gympie Regional Council (‘Potter’), applied the reasoning in Paige and Govier and affirmed a decision of Brown J in the Queensland Supreme Court, holding that an employer did not owe a duty of care to an employee in relation to its decision to suspend the employee pending an investigation into serious misconduct allegations.[93]
[93][2022] QCA 255, [29]–[36] (Flanagan JA, Mullins P and Williams J agreeing).
Subsequently, in November of 2023 in this Court in Vision Australia, after referring to the decisions in Paige, Shaw, Govier and Potter, and obiter dicta in Lloyd,[94] the Court noted that the facts in that case, as in Paige, are ‘directly concerned with the failure to give due process in the course of making a decision to terminate’.[95] The Court also extracted the following passage from Paige:
The area of unfair dismissals is heavily regulated in both State and Commonwealth contexts. It represents a particular and carefully calibrated balancing of the conflicting interests involved namely, between preserving the expectations of employees on the one hand and enabling employers to create jobs and wealth, on the other hand. The arguments and factors accepted in Johnson v Unisys are directly applicable to the legislation examined above and the same conclusion, namely a refusal to expand the duty of care in negligence to provide an alternative cause of action for unfair dismissals, should be the result.
The expansion of the law of tort to matters concerning the creation and termination of a contract of employment, as distinct from performance under the contract, may distort the balance of conflicting interests found to be appropriate as a matter of contract or by intervention of statute. Where, as here, the courts are asked to create a novel duty of care, the courts should refrain from doing so where there is such a well developed alternative mechanism for adjusting the interests involved. Matters concerning the creation and termination of a contract of employment can, in my opinion, properly be left to the law of contract, subject to the extensive statutory modification that the parliaments have introduced into this specific area of contract law.[96]
[94]Lloyd [2021] VSCA 327, [67] (Beach, Osborn JJA, Forbes AJA).
[95]Vision Australia [2023] VSCA 265, [253] (McLeish, Kennedy and Macaulay JJA).
[96]Ibid [248], citing Paige (2002) 60 NSWLR 371, 400 [154]–[155].
The Court applied it stating:
The reasoning of Spigelman CJ is careful and comprehensive and has been followed by a number of other appellate courts as we have already set out. Although Mr Elisha sought to suggest that Potter was wrong, he otherwise did not suggest that any of the cases cited, including Paige, were plainly wrong.[97]
[97]Vision Australia [2023] VSCA 265, [254].
At trial in the present case, it was said that Paige should be distinguished as it involved the application of New South Wales legislation (the Teaching Services Act1980 (NSW)) as the statutory basis for the termination of employment. In her written case on this application, Ms Milonas contended that ‘the conduct of the subject disciplinary investigation is not precluded by the line of authorities’. It was not explained why this was so, and no effort was made to distinguish this case from Paige or any of the other decisions which followed it. Nor in oral argument on the hearing of the application in February 2024 was it suggested that the facts of this case were distinguishable from those in Vision Australia such that it, and the other appellate authorities, ought not be followed.
The decision in Paige, as recognised by other appellate courts, is of general application. The judge was correct in following it and the appellate decisions that applied its reasoning in rejecting the proposition that Monash owed Ms Milonas a duty of care in relation to the conduct of the investigation and dismissal process.
We are conscious that special leave to appeal to the High Court the decision in Vision Australia on this issue has been granted. Nevertheless, as things presently stand, consistent with this Court’s decision in Vision Australia, we are not satisfied that Paige or any of the other appellate cases which have applied Paige are plainly wrong and should be departed from.[98]
[98]Farah Construction Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89, 151–2, [135] (Gleeson CJ, Gummow, Callinan, Heydon and Crennan JJ).
Notwithstanding this conclusion, as we stated at the commencement of these reasons, it is appropriate here to briefly examine the correctness of the judge’s decision as to a putative breach of duty.
Ms Milonas’ written case on this application under proposed grounds 5 and 6 dealt with breach of both the contractual terms and in negligence, compendiously and without distinction as to the content of two alleged obligations. The case in contract was somewhat easier to discern than that in negligence — if there was incorporation of cl 77.5.1 of the EA, then Monash was obliged to afford Ms Milonas procedural fairness in the course of the investigation and the dismissal process.
However, identification in the negligence case of the content of the relevant duty allegedly owed by Monash to Ms Milonas was elusive — as the judge recognised.
The judge correctly noted that the pleaded case conspicuously failed to identify any aspect of the relevant content of Monash’s duty to Ms Milonas. At the conclusion of the trial, Ms Milonas’ counsel had identified the duty as follows: ‘to provide a safe system of work in the undertaking of the investigation into alleged misconduct by the Plaintiff’. This did not do a lot (if anything) to clarify things in terms of the actual content of the duty — namely what was a reasonable employer required to have done in ‘undertaking the investigation’. The judge considered, at [72] of the Reasons, this deficiency — namely the failure to plead the nature of the duty — to be fatal.
Despite this, his Honour then went on to consider Ms Milonas’ case as set out in her counsels’ submissions. In doing so, it appears that he treated the content of the employer’s obligation to be as follows: Monash as a reasonable employer was obliged to afford Ms Milonas procedural fairness in the course of the investigation and dismissal process.
On behalf of Ms Milonas on the hearing of this application, the following was said to constitute Monash’s breach of duty:
•No signed statements, proofs of evidence or the like were obtained from Ms Milonas.
•No attempt was made to conjointly interview those persons in order to determine variations, which meant information purportedly provided by each in unsigned, unsighted and unacknowledged documents which purported to be records of interviews was used to underpin Monash’s investigation process.
•It was not understood by the investigators, Ms McNulty and Mr Willmott, that Ms Unicomb had never denied there was an agreement of the type which Mr Sharma alleged and which Ms Milonas believed to have been made.
•The investigating team of Ms McNulty and Mr Willmott had no knowledge of the Briginshaw principle.[99]
[99]Briginshaw v Briginshaw (1938) 60 CLR 336.
If a body is obliged to afford a person procedural fairness, then it must abide by the fair hearing rule and the rule against bias. There was no allegation of bias in this case. The fair hearing rule is protean and depends upon the circumstances of the case.[100] It is ‘neither standardized nor immutable’[101] and requires ‘[a]n evaluation of the realities and not the legalities of the situation’.[102] It generally requires the following:[103]
(a)adequate notice that a decision may be made that may affect a person’s interests;
(b)disclosure of the primary issues which are to be addressed and provision of information relevant to those issues; and
(c)a hearing with a reasonable opportunity to present a case.
[100]Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1, 16 [48] (McHugh and Gummow JJ).
[101]MH6 v Mental Health Review Board (2009) 25 VR 382, 390 [28] (Redlich JA and Hargrave AJA) (‘MH6’) citing Public Service Board (NSW) v Osmond (1986) 159 CLR 656, 676 (Deane J).
[102]MH6 (2009) 25 VR 382, 391 [30] (Redlich JA and Hargrave AJA) citing White v Ryde Municipal Council [1977] 2 NSWLR 909, 925 (Reynolds JA).
[103]See MH6 (2009) 25 VR 382, 390–1 [28]–[30].
The judge accepted the evidence of Ms McNulty and Mr Wilmott, which was essentially unchallenged once Ms Milonas’ evidence was put to one side. Despite cross-examination as to alleged flaws in the process, there was no reason not to accept their version of the steps taken and procedures adopted by Monash in carrying out the investigation. Moreover, it was accompanied and corroborated by contemporaneous documentation as to the manner in which the process evolved, was conducted and finalised.
The complaints of Ms Milonas as to the conduct of the investigation are ill-founded, and the judge’s conclusion at [73] of the Reasons and set out above at [140] was correct. The steps taken by Monash in the context of the dismissal process satisfied the fair hearing rule.
The specific allegations by Ms Milonas of breach, in the context of an employer’s investigation of a serious allegation of misconduct, are misguided. This is particularly so when the scope and content of any putative duty must take into account Ms Milonas’ alternative remedies under pt 3.2 of the Fair Work Act 2009 (Cth) (‘Fair Work Act’) (and particularly the criteria for determining whether the dismissal was ‘harsh, unjust or unreasonable’ in s 387) and, perhaps, under order 56 of the Supreme Court (General Civil Procedure) Rules 2015. This consideration demonstrates the force of the reasoning of Spigelman CJ in Paige on the question of coherence with employment and administrative law.[104]
[104]Paige (2002) 60 NSWLR 371, 395–405 [132]–[182] (Spigelman CJ).
The contention that the Briginshaw test was a necessary concomitant of procedural fairness in the context of an employer’s dismissal process was unsubstantiated by authority and avoided the existence of Ms Milonas’ right of review of Monash’s decision under the Fair Work Act. In any event, the judge found that the test had been applied by Monash in determining whether Ms Milonas’ actions amounted to ‘serious and wilful misconduct’.[105]
[105]Reasons, [62].
Finally, the complaint that Ms McNulty and Mr Willmott misunderstood the nature of Ms Unicomb’s evidence demonstrates the confusion in Ms Milonas’ argument. This submission went, not to the adequacy of the process, but to the reasonableness of the decision-making, and has nothing to do with a requirement for procedural fairness.[106]
[106]Rather, if this was an administrative law case, it would be determined by arguments about irrationality or unreasonableness.
In any event, the proposition is misconceived. It was abundantly clear that Ms Unicomb’s telephone discussion and subsequent email of 18 May 2013 refuted the allegation that there was any such agreement. Just because she had no recollection of such a meeting did not mean that she accepted that it occurred.
This proposed ground fails.
Conclusion
None of the proposed grounds are made out. The application for leave to appeal should be refused.
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‘Without limiting the matters that the court may take into account in deciding whether it is so satisfied, it is to take into account—
(a) the nature of the cause of action or defence; and
(b) the nature of the subject-matter of the proceeding; and
(c) the gravity of the matters alleged.’
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