Patty v Commonwealth Bank

Case [2000] FCA 1072

FEDERAL COURT OF AUSTRALIA

Patty v Commonwealth Bank [2000] FCA 1072

INDUSTRIAL – TERMINATION OF EMPLOYMENT - review of Judicial Registrar’s decision dismissing employee’s application – whether employer had established on balance of probabilities that it had a valid reason for termination

JURISDICTION – application for review of Judicial Registrar’s decision filed in Federal Court – subsequent change in law raising jurisdictional question – whether Industrial Relations Court of Australia has exclusive jurisdiction to determine application – hearing conducted in Federal Court before Judge of both Federal Court and Industrial Relations Court of Australia – whether discretionary power to rectify consequence of finding that jurisdiction possessed by Industrial Relations Court and not Federal Court.

Industrial Relations Act 1988 (Cth) ss 377, 419, 481
Workplace Relations and Other Legislation Amendment Act 1996 (Cth) Sch 16
Federal Court of Australia Act 1976 s 23

Autistic Association of New South Wales v Dodson [1999] FCA 439 (unreported, 14 April 1999)
Kumar v. Prima Furniture (NSW) Pty Ltd (1997) 75 FCR 477

Zechner v Department of School Education [1999] FCA 445;  (1999) 88 IR 142
Konrad v Victoria Police [1999] FCA 988;  (1999) 165 ALR 23
Jackson v Sterling Industries Ltd (1987) 162 CLR 612
Victoria v The Commonwealth (1996) 187 CLR 416
Qantas Airways Limited v Cornwall (1998) 83 IR 102
Cosco Holdings Pty Ltd v Thu Thi Van Do (1997) 77 IR 94
Murdoch University v Mainsbridge (1998) 84 IR 111
Sangwin v Imogen Pty Ltd (von Doussa J, IRCA, 8 March 1996, unreported)
Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371
Associated Dominion Assurance Society Pty Ltd v Andrew (1949) 49 NSWSR 351

Allied Express Transport Pty limited v Anderson (1998) 81 IR 410

DEAN PATTY v  COMMONWEALTH BANK OF AUSTRALIA (ACN 123 123 124)
VI 2542 of 1996

RYAN J
MELBOURNE
4 AUGUST 2000


IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY

VI 2542 OF 1996

BETWEEN:

DEAN PATTY
Applicant

AND:

COMMONWEALTH BANK OF AUSTRALIA
ACN 123 123 124
Respondent

JUDGE:

RYAN J

DATE OF ORDER:

4 AUGUST 2000

WHERE MADE:

MELBOURNE

MINUTES OF ORDER

THE COURT ORDERS:

1.        That the application for review be adjourned to a date to be fixed.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.


IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY

 VI 2542 OF 1996

BETWEEN:

DEAN PATTY
Applicant

AND:

COMMONWEALTH BANK OF AUSTRALIA
ACN 123 123 124
Respondent

JUDGE:

RYAN J

DATE:

4 AUGUST 2000

PLACE:

MELBOURNE

REASONS FOR JUDGMENT

  1. There is before the Federal Court of Australia a motion pursuant to s 377 of the Industrial Relations Act 1988 (Cth) (“the Act”) for review of a decision of a Judicial Registrar dismissing an application under s 170EA of the Act for relief in respect of the termination of the applicant's employment by the respondent, the Commonwealth Bank of Australia (“the Bank”). It was agreed between the parties that, subject to the evidence of Mr Patty and…

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AGLC
Patty v Commonwealth Bank [2000] FCA 1072
Case
[2000] FCA 1072
Decision Date

CaseChat Overview and Summary

Patty v Commonwealth Bank involved the applicant, a former employee of the Commonwealth Bank, contesting his termination of employment on the grounds of alleged unlawful termination. The applicant had been employed by the Bank until 26 August 1996, when he was dismissed following an incident involving the theft of cash from an ATM. The dispute centred on whether the applicant was involved in the theft, and if so, whether this involvement justified his termination. The court was required to decide whether the applicant had indeed participated in the theft of $27,400 from an ATM, and if his involvement constituted grounds for termination.

The court considered the evidence presented, including testimonies from various witnesses and inconsistencies in the applicant's statements. The Judicial Registrar concluded that while there was insufficient evidence to prove that the applicant personally removed the cash, there was sufficient evidence to show that he was involved and implicated in the theft. This conclusion was based on multiple inconsistencies in the applicant’s account and his refusal to provide further clarification. The court found that the Bank had a valid belief in the applicant’s implication in the theft, which justified his termination on the grounds of misconduct.

As a result, the court dismissed the applicant’s application for relief, affirming the Bank’s decision to terminate his employment. The court found that the evidence supported the Bank’s belief that the applicant was involved in the theft, which constituted misconduct warranting termination.

Orders

Orders of the court

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Background

Background to the litigation

I do not consider, in these circumstances, that it is either necessary or in the interests of justice to allow the applicant leave to file a notice of motion for review out of time in IRCA, or to require that the extensive proceedings before me be re-litigated in any way. However, if it would be wrong to make any of the orders foreshadowed at the end of these reasons, which are intended to procure a final determination, subject only to appeal, on the merits of the matter, I indicate that I would be prepared to take whatever other steps are necessary to achieve such a determination by a court having jurisdiction to entertain the matter.The factual background The applicant was employed by the respondent, (“the Bank”) until 26 August 1996. On the weekend of 10 and 11 February 1996 the applicant and another Bank officer, Mr Dino Centofanti, were rostered as a team to be “on call” to provide service and maintenance attention to automatic telling machines (“ATMs”) operated by the Bank in the Brunswick/Coburg region. The following description of the Bank’s practice for the servicing of its ATM’s is taken from the reasons for decision of the learned Judicial Registrar:“ATM machines are usually accessed by removing two combinations, a top combination known as the ‘A’ combination or lock and the bottom combination known as the ‘B’ combination or lock. ATM service teams usually comprise two officers. The teams are rostered to attend to operational faults out of hours and especially to attend to these faults at weekends. Machine malfunction is common. Many operational faults are fixed by ATM service teams. The usual procedure involves each member of the team being responsible for calculating and removing either the A or B combination on the ATM. Each team member is issued with a sealed envelope which contains numbers which allow for the calculation of either the A or B combination.” Early in the afternoon of 10 February 1996, the applicant and Mr Centofanti, in response to a request from the Information Services Department, attended the Bank’s Collingwood Service Centre, a sub-branch of the Bank at 150 Smith Street, Collingwood. They were present at those premises from 1.43 to 2.22 pm. During that time difficulties were encountered in establishing the A and B codes to open the ATM. What occurred at the Collingwood Service Centre on that occasion has been the subject of detailed findings of fact by the Judicial Registrar none of which has been significantly challenged in the course of the present hearing. The Judicial Registrar’s findings were as follows:“At 13.43.39.04 (i.e. at 1.43 pm) Centofanti logged on with the Voice Response Unit (VRU) in Sydney. He did this by telephone from the Collingwood Service Centre at 150 Smith Street. Very soon thereafter, the applicant contacted the Security Monitoring Centre (SMC) and advised that the service team was in the branch and was about to deactivate the alarm system. There are log reports provided by SMC and Wormald Security Monitoring Service confirming these logging on calls.Centofanti attempted to obtain the B combination for the ATM by using a touch phone and keying in his staff number and (supposedly) the bank branch number. At about 13.45.33.04 (i.e. at 1.45 pm) Centofanti keyed in an incorrect branch number and could not further access a series of numbers which, if obtained, and deducted from other numbers held by him in a sealed envelope, would have provided the correct combination for the B lock on the ATM machine.At this stage, the applicant went downstairs. He has stated that he went downstairs to use the toilet. Meanwhile, Centofanti, having failed to obtain the B combination because of an invalid branch number, attempted to contact two other bank officers by phone with a view to obtaining the correct branch number and accessing it. He was unsuccessful in locating either bank officer and began searching desk drawers in the hope of locating the correct branch number. He located a grey key card wallet in the top drawer on the left hand side of a desk normally occupied by the second in charge of the bank. Centofanti described the wallet as ‘old and tatty’. Within the wallet, on a ‘Record of Account Details Card’, two series of numbers were written. He assumed that the numbers might have been the actual combinations of the A and B locks for the ATM. He was correct in the assumption that one series of numbers represented the A combination. Using these numbers he removed the A combination. Using the other series of numbers, he unsuccessfully tried to remove the B combination. The applicant had by then returned from downstairs. Centofanti asked the applicant to try and remove the B combination using the numbers on the card. The applicant tried and was also unsuccessful.The Court pauses to note that the recording of ATM combination numbers and the leaving of such numbers in any place where access might be obtained was a clear breach of the respondent’s security procedures. This was only one of many breaches of security procedures which occurred at 150 Smith Street and which appear to have occurred frequently at many branches of the bank. On that day Centofanti was responsible for the B combination. His removal of the A combination was a breach of security procedure. The applicant was responsible for the A combination. His attempts to remove the B combination were also a breach of security procedure.At this stage, Centofanti successfully contacted another ATM service member by telephone and obtained from her the correct branch number. While Centofanti was so engaged, the applicant continued to search desk drawers in the hope of locating the B combination.Once Centofanti had obtained the branch number he logged on again with VRU by touch phone and was placed on hold. At weekends, service team members often have to wait to be provided with numbers which allow calculation of combination locks. Such relatively short delays appear to be an inevitable result of the volume of telephone calls made by service team members. While Centofanti was on hold, the applicant successfully ‘solved’ the ATM ‘communication problem’ by resetting a controller or rebooting a modem.While the applicant was so engaged, Centofanti obtained the appropriate numbers from VRU and calculated the B combination which he wrote on ‘a piece of paper’. Although the ATM communication problem appeared solved because of the applicant’s resetting of a controller, Centofanti decided to open the ATM and confirm the machine was working by performing what is known as a ‘COCO’ test. To perform the COCO test, having earlier removed the A combination, he removed the B combination using the combination number on the piece of paper, partially opened the ATM security door and flicked a toggle switch located inside the ATM security area. The ATM then performed a self test program which registered a ‘COCO display’ which indicated that the machine was once more in working order. Centofanti then secured the ATM door by spinning the combinations and telephoned VRU to log on for the next service call. At the same time, the applicant advised SMC that the alarm was about to be reactivated.”

Evidence

Evidence Before The Court

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Decision

Reasons for decision

RYAN J
That letter elicited the following “without prejudice” reply from the Bank's solicitor:"I refer to your letter of 25 September 1996 and advise that the Bank is prepared to, and indeed would like to, receive written answers to those questions previously posed to your client, on a number of occasions, in relation to the theft of cash amounting to $27,4000.00.If your client is prepared to answer those questions the Bank may reconsider its position in the light of such answers. The provision of those answers must in no way be construed as an undertaking to re-employ alternatively reinstate Mr Patty.The Bank is also not prepared to furnish your client with any documentation as requested in your letter under reply. The answers to the questions are exclusively within your client's knowledge and would not be gleaned from documents provided by the Bank. The Bank is also weary of a pre-emptive “fishing expedition” being conducted by your client without him first providing the outstanding answers to the Bank questions.The Bank is of the opinion that it would be in the interest of trying to resolve this matter if your client provided answers to the outstanding questions, the sooner he does so the better. Once those answers are provided the Bank will assess them in the light of its thorough investigation of this matter.It is suggested that you notify the Industrial Relations Commission that the matter be adjourned for say 2 weeks in order to give your client time to provide those answers and for the Bank to assess them.I look forward to hearing from you.”The Judicial Registrar's conclusions. The learned Judicial Registrar concluded that he was not satisfied on the balance of probabilities that the applicant had personally removed the cash from the ATM on the evening of 10 February 1996. However, he went on to express himself satisfied, also on the balance of probabilities, that Mr Patty had been involved and implicated in the theft. The reasons for reaching these conclusions were expressed as follows:“In my view the respondent has failed to establish on any test of balance of probability that the applicant personally removed the cash from the ATM on the evening of 10 February 1996 but has established on such a test of probability that the applicant was involved and was implicated in the theft. In reaching that conclusion the respondent was entitled to take account of·the many inconsistencies in the evidence at that time of the applicant and Ms Blencowe·the inconsistencies at that time between the evidence of each of them·the inconsistencies at that time in the evidence of the applicant and Centofanti·the repeated refusal of the applicant to cooperate further and comment further or clarify inconsistencies put to himFurthermore, this Court, in reaching the conclusion the respondent had a valid reason based on belief of implication in theft, is able to take account not only of the inconsistencies outlined above but also the many inconsistencies which presented in evidence at trial.I am satisfied on a balance of probability that the respondent has established that the applicant was implicated in theft and that the involvement of the applicant in that theft constituted misconduct which was a valid reason for termination of employment. On that ground, I propose to dismiss the application seeking relief for alleged unlawful termination of employment.”

Ratio Decidendi

Legal Principle Established

Established by: RYAN J

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