Ramsey v Annesley College
[2013] SASC 72
•17 May 2013
SUPREME COURT OF SOUTH AUSTRALIA
(Civil)
RAMSEY v ANNESLEY COLLEGE
[2013] SASC 72
Judgment of The Honourable Justice Blue
17 May 2013
CONTRACTS - GENERAL CONTRACTUAL PRINCIPLES - FORMATION OF CONTRACTUAL RELATIONS - CONTRACT IMPLIED FROM CONDUCT OF PARTIES
EMPLOYMENT LAW - CONTRACT OF SERVICE - TERMS OF CONTRACT - IMPLIED TERMS
EMPLOYMENT LAW - TERMINATION AND BREACH OF CONTRACT - GROUNDS - MISCONDUCT - GENERALLY
EMPLOYMENT LAW - TERMINATION AND BREACH OF CONTRACT - REMEDIES - AGAINST EMPLOYER
DAMAGES - MEASURE AND REMOTENESS OF DAMAGES IN ACTIONS FOR BREACH OF CONTRACT - GENERAL
Ms Ramsey was employed by Annesley College as Head of Boarding from 2003 under formal employment contracts executed in 2002 and 2005. In mid 2009, there were discussions concerning a further three or five year contract after expiration of the current contract in January 2010. The discussions were confirmed, to an extent, by letters from Annesley to Ms Ramsey. There was discussion about preparation of a formal contract. Ms Ramsey contends and Annesley denies that by the conversations or letters or by their conduct the parties entered into a three or five year contract of employment. Ms Ramsey continued to be employed by Annesley beyond the 31 January 2010 expiration of the 2005 contract. Annelsey accepts that an implied contract arose but for no fixed term and terminable on notice.
In November 2009, the Deputy Head of Boarding made a complaint about Ms Ramsey’s conduct. Annesley conducted an investigation subsequently expanded to encompass other allegations about Ms Ramsey’s conduct. Ms Ramsey contends that Annesley breached the implied term of mutual trust and confidence (and another alleged implied term) in the conduct of that investigation.
In March 2010, Annesley purported to dismiss Ms Ramsey summarily on the ground that she was guilty of serious misconduct. Ms Ramsey contends that Annesley had no grounds for summary dismissal and thereby breached and repudiated the contract. She also contends that Annesley dismissed her for an ulterior motive of saving expenses.
Ms Ramsey claims damages comprising 12 weeks’ remuneration, loss of the opportunity to remain at Annesley, loss of the opportunity to gain employment elsewhere in the teaching profession, mitigatory expenditure and damages for distress.
HELD:
1. The parties did not enter into a three or five year contract in 2009 or 2010 (at [143]-[176]).
2. The parties by their conduct entered into a contract of employment for no fixed term, terminable on 12 weeks’ notice, with effect from 1 February 2010 (at [177]-[187]).
3. It was not a term of the contract that Annesley would comply with its Complaints Policy (at [193-[209]).
4. Annesley did not breach the implied term of mutual trust and confidence in the conduct of the investigation (at [337]-[369]).
5. Annesley did not dismiss Ms Ramsey summarily acting under an ulterior motive of reducing expenses (at [370]-[378]).
6. Ms Ramsey was not guilty of misconduct. Annesley had no grounds to terminate the contract summarily. Annesley breached and repudiated the contract in purporting to dismiss Ms Ramsey summarily (at [270]-[336]).
7. Ms Ramsey is entitled, in debt or alternatively in damages, to payment of 12 weeks’ remuneration and long service leave totalling $47,081.95 (at [381]-[386]).
8. There is no reason in principle why Ms Ramsey could not recover the value of a lost opportunity to continue at Annesley (at [389]-[403]). However, on the facts, Annesley would not have continued to employ Ms Ramsey in any event and no damages are recoverable (at [404]-[412]).
9. Ms Ramsey is not entitled in principle to recover as damages for the breach comprising wrongful termination the value of a lost opportunity to obtain employment elsewhere in the teaching profession (at [437]-[458]). She would have been entitled in principle to recover such damages for breach of the mutual trust and confidence term, but she failed to prove breach of that term (at [461]-[475]). In any event, she failed to prove that she had a valuable opportunity which was lost or reduced due to Annesley’s breach of contract (at [477]-[491]).
10. Ms Ramsey is not entitled to recover her costs of action as mitigatory expenditure because the head of loss avoided or reduced by such expenditure is not recoverable (at [492]-[494]).
11. Ms Ramsey is not entitled to recover damages for distress because her claim does not fall within the exceptions identified in Baltic Shipping Co v Dillon (at [496]-[505]).
12. Ms Ramsey is entitled to judgment for $47,081.95 with the parties to be heard as to other orders (at [506]-[513]).
Annesley College Act 1920 (SA); Employment Rights Act 1996 (UK); Evidence Act 1929 (SA) s 34C; Fair Trading Act 1987 (SA); Industrial Relations Act 1996 (UK); Long Service Leave Act 1987 (SA) s 5(4)(a); Supreme Court Civil Rules 2006 r 223; Workplace Relations Act 1996 (Cth) s 170EE, referred to.
Abrahams v Performing Right Society Ltd [1995] ICR 1028; Addis v Gramophone Company Limited [1909] AC 488; Australian Broadcasting Corporation v XIVth Commonwealth Games Limited (1988) 18 NSWLR 540; Baltic Shipping Co v Dillon (1993) 176 CLR 344; BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266; Brambles Limited v Andar Transport Pty Ltd [2002] VSCA 150; (2002) 5 VR 169; Burazin v Blacktown City Guardian Pty Ltd (1996) 142 ALR 144; Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337; Commonwealth of Australia v Amann Aviation Pty Ltd (1991) 174 CLR 64; Coyne v Commercial Equity Corporation Ltd (1998) 20 WAR 109; Delooze v Healy [2007] WASCA 157; Guthrie v News Limited [2010] VSC 196; (2010) 27 VR 196; Intico (Vic) Pty Ltd v Walmsley [2004] VSCA 90; Perkins v Grace Worldwide (Aust) Pty Ltd (1997) 72 IR 186; Reilly v Praxa Ltd [2004] ACTSC 41; Rex Stewart Jeffries Parker Ginsberg Ltd v Parker [1988] IRLR 483; Russell v The Trustees of the Roman Catholic Church, Archdiocese of Sydney (2008) 72 NSWLR 559; Shepherd v Felt and Textiles of Australia Ltd (1931) 45 CLR 359; Tasmania Development & Resources v Martin [2000] FCA 414; (2000) 97 IR 66; TCN Channel 9 Pty Ltd v Hayden Enterprises Pty Ltd (1989) 16 NSWLR 130; Thorpe v Lochel [2005] WASCA 85; (2005) 31 WAR 500; Walker v Citigroup Global Markets Pty Ltd [2005] FCA 1678; (2005) 226 ALR 114, applied.
Quinn v Gray [2009] VSC 136; (2009) 184 IR 279, distinguished.
Bostik (Australia) Pty Ltd v Gorgevski (1992) 36 FCR 20; Eastwood and Anor v Magnox Electric plc and McCabe v Cornwall County Council [2004] UKHL 35; [2005] 1 AC 503; Edwards v Chesterfield Royal Hospital NHS Foundation Trust [2011] UKSC 58; [2012] 2 AC 22; Goldman Sachs JBWere Services Pty Limited v Nikolich [2007] FCAFC 120; (2007) 163 FCR 62; Hadley v Baxendale (1854) 9 Ex 341; 156 ER 145; Johnson v Unisys Ltd [2001] UKHL 13; [2003] 1 AC 518; Koehler v Cerebos (Australia) Limited [2005] HCA 15; (2005) 222 CLR 44; Malik v Bank of Credit and Commerce International SA (in compulsory liquidation) [1998] AC 20; McDonald v Parnell Laboratories (Aust) Pty Ltd [2007] FCA 1903; (2007) 168 IR 375; Murray Irrigation Ltd v Balsdon [2006] NSWCA 253; (2006) 67 NSWLR 73; New South Wales v Paige [2002] NSWCA 235; (2002) 60 NSWLR 371; Nikolich v Goldman Sachs J B Were Services Pty Ltd [2006] FCA 784; Riverwood International Australia Pty Ltd v McCormick [2000] FCA 889; (2000) 177 ALR 193; Shaw v State of New South Wales [2012] NSWCA 102; (2012) 219 IR 87; State of South Australia v McDonald [2009] SASC 219; (2009) 104 SASR 344; The Mihalis Angelos [1971] 1 QB 164; Thompson v Orica Australia Pty Ltd [2002] FCA 939; (2002) 116 IR 186; Yousif v Commonwealth Bank of Australia [2010] FCAFC 8; (2010) 193 IR 212, discussed.
Abrahams v Herbert Reiach Ltd [1922] 1 KB 477; ACN 096 278 483 Pty Ltd v Vercorp Pty Ltd [2011] QCA 189; Amann Aviation Pty Ltd v Commonwealth of Australia (1990) 22 FCR 527; Andar Transport Pty Ltd v Brambles Ltd [2004] HCA 28; (2004) 217 CLR 424; Associated Savings Pty Ltd v Pantelos (1995) 180 LSJS 248; Astley v Austrust Limited [1999] HCA 6; (1999) 197 CLR 1; Australian Consolidated Press Ltd v Uren (1966) 117 CLR 185; Barker v Commonwealth Bank of Australia [2012] FCA 942; Barrier Wharfs Ltd v W Scott Fell & Co Ltd (1908) 5 CLR 647; Blaikie v SA Superannuation Board (1995) 65 SASR 85; Bliss v South East Thames Regional Health Authority [1987] [1985] IRLR 308; Burns v MAN Automotive (Aust) Pty Ltd (1986) 161 CLR 653; Byrne v Australian Airlines Ltd (1995) 185 CLR 410; C Czarnikow Ltd v Koufos (The Heron II) [1969] 1 AC 350; Central City Pty Ltd v Montevento Holdings Pty Ltd [2011] WASCA 5; Commonwealth of Australia v Amann Aviation Pty Ltd (1988) 100 ALR 267; DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423; Energy World Corporation Ltd v Maurice Hayes and Associates Pty Ltd [2007] FCAFC 34; (2007) 239 ALR 457; Ermogenous v Greek Orthodox Community of SA Inc [2002] HCA 8; (2002) 209 CLR 95; Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22; (2007) 230 CLR 89; Fink v Fink (1946) 74 CLR 127; Gates v City Mutual Life Assurance Society Ltd (1986) 160 CLR 1; Gray v Motor Accident Commission [1998] HCA 70; (1998) 196 CLR 1; Heyman v Darwins Ltd [1942] AC 356; Howard Smith & Co Ltd v Varawa (1907) 5 CLR 68; Jaensch v Coffey (1984) 155 CLR 549; Jones v Dunkel (1959) 101 CLR 298; Lennon v The State of South Australia [2010] SASC 272; March v E & MH Stramare Pty Ltd (1991) 171 CLR 506; Malik v Bank of Credit and Commerce International SA (in liq) [1995] 3 All ER 545; Marks v GIO Australia Holdings Ltd [1998] HCA 69; (1998) 196 CLR 494; McDonald v State of South Australia [2008] SASC 134; (2008) 172 IR 256; McRae v Commonwealth Disposals Commission (1951) 84 CLR 377; Morton v Transport Agency Board (No 1) [2007] NSWSC 1454; (2007) 168 IR 403; Overseas Tankship (UK) v Morts Dock and Engineering Co Ltd (The Wagon Mound) [1961] AC 388; Pacific Carriers Ltd v BNP Paribas [2004] HCA 35; (2004) 218 CLR 451; Pearce v Foster (No 2) (1886) 17 QBD 536; Progressive Mailing House Pty Ltd v Tabali Pty Ltd (1985) 157 CLR 17; Rawson v Hobbs (1961) 107 CLR 466; Re Rubel Bronze and Metal Co Ltd and Vos Arbitration [1918] 1 KB 315; Robb v Green [1895] 2 QB 315; Russell v The Trustees of the Roman Catholic Church for the Archdiocese of Sydney [2007] NSWSC 104; (2007) 69 NSWLR 198; Sellars v Adelaide Petroleum NL (1994) 179 CLR 332; Shevill v Builders Licensing Board (1982) 149 CLR 620; Sunbird Plaza Pty Ltd v Maloney (1988) 166 CLR 245; Thorpe v South Australian National Football League (1974) 10 SASR 17; Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; (2004) 219 CLR 165; Uren v John Fairfax & Sons Pty Ltd (1966) 117 CLR 118; Williams v Frayne (1937) 58 CLR 710, considered.
RAMSEY v ANNESLEY COLLEGE
[2013] SASC 72Table of Contents
A. FACTUAL BACKGROUND
Annesley College
School hierarchy and personnel
Boarding House hierarchy
Ms Ramsey
Employment contracts
Overview of 2009
Term two 2009
Term three 2009
Term four 2009
School holidays 2009-2010
Term one 2010
Subsequent events
B. PLEADED CASES AND WITNESSES
Plaintiff’s pleaded case
Defendant’s pleaded case
Plaintiff’s witnesses
Defendant’s witnesses
Plaintiff’s evidence
C. EXISTENCE (IDENTITY) OF CONTRACT
Express fixed term contract
Oral contract 23 June 2009
Written offer and oral acceptance
Oral contract 4 August 2009
Affirmation in December 2009Conclusion
Implied contract arising from conduct
Conduct between June and December 2009
Conduct inconsistent with expiry of employment relationshipConclusion
D. TERMS OF THE CONTRACT
“Express” terms
Implied terms
Mutual trust and Confidence
Compliance with Complaints Policy
Management of complaintsConclusion
E. RELATIONSHIP BETWEEN MS RAMSEY AND MS TONKIN AND OTHER STAFF
Context
Ms Tonkin’s rostered hours
Notification to Ms Tonkin of absences by Ms Ramsey
Disallowance of overtime
Participation in the last chapel service
Inter-Boarding School Christmas dinner
Boarding House staff reporting to Ms Ramsey
Meeting on 29 October 2009
International boarders’ exeat homestays
Addressing kitchen staff
The treatment of Boarding House mistresses
F. ALLEGED BREACH OF CONTRACT BY MS RAMSEY
Cost of damaged fire door
Conduct in April 2009
Denial in March 2010
Permitting consumption of alcohol
Conduct in August 2009
Denial in March 2010
Reference to Indigenous students
Conduct in July or October 2009
Denial in March 2010
Attempts by Ms Ramsey to mislead Annesley
Discussion with Ms Tonkin in September 2009
Discussion with Ms Bradey and Ms Turner in October 2009
Discussion with Mr Cirillo in January 2010Conclusion
G. BREACH OF CONTRACT BY ANNESLEY
Unjustified termination
Breach by adoption of procedure
20 November to 2 December 2009
2 to 8 December 2009
8 December 2009 to 8 February 2010
9 February to 11 March 2010
3 to 17 March 2010
Ulterior motive for dismissal
H. DIRECT LOSS AND DAMAGE
Debt
Damages
I. LOSS OF OPPORTUNITY TO REMAIN AT ANNESLEY
Availability of claim at law
Assessment of loss of chance
J. LOSS OF OPPORTUNITY TO WORK IN EDUCATION ELSWHERE
Relevant evidence
Recoverability of head of loss: causation principles
General causation principles
Breach by wrongful termination
Breach of mutual trust and confidence term
Assessment of the facts
Loss of opportunity 2010-2012
Loss of future opportunityConclusion
K. MITIGATORY EXPENDITURE
L. DAMAGES FOR DISTRESS
Principle
Application
M. CONCLUSION
Civil:
BLUE J:
The plaintiff, Rebecca Ramsey, was employed by the defendant, Annesley College, as Head of Boarding from 1 February 2003.
On 19 March 2010, Annesley purportedly terminated Ms Ramsey’s employment summarily on the grounds that she had allegedly engaged in serious and wilful misconduct warranting termination without notice at common law.
Ms Ramsey sues Annesley for damages for breach of contract, claiming that the purported termination was wrongful.
The principal issues in the action are as follows.
1. When and how did the parties enter into an employment contract in 2009/2010?
2. What were the terms of the contract?
3. Did Ms Ramsey engage in the conduct alleged by Annesley to be misconduct?
4. If so, did that conduct breach Ms Ramsey’s obligations under her contract of employment?
5. If so, were the breaches sufficiently serious to entitle Annesley to terminate the contract?
6. Did Annesley breach the terms of or repudiate the contract by its investigation or by its summary termination?
7. If so, what recoverable damages did Ms Ramsey suffer as a result of the breach or repudiation by Annesley? In particular:
a. What is the quantum of Ms Ramsey’s entitlements to salary in lieu of notice and long service leave?
b. Did the breach cause Ms Ramsey to lose the opportunity to continue employment with Annesley until the end of 2011, the value of which is recoverable and, if so, what is the value of that lost opportunity?
c. Did the breach cause Ms Ramsey to lose the opportunity to obtain alternative executive level teaching employment elsewhere in Adelaide, the value of which is recoverable and, if so, what is the value of that lost opportunity?
d. Are Ms Ramsey’s costs of this action recoverable as expenditure calculated to mitigate her consequential losses and, if so, to what extent and in what amount?
e. Did the breach cause Ms Ramsey to suffer distress and anxiety, the value of which is recoverable and, if so, what is the value of the distress and anxiety?
The alleged misconduct ultimately relied upon at trial by Annesley was as follows:
1.exaggerating to boarders and their parents the cost to replace a damaged fire door in April 2009;
2.permitting the consumption by two year 11 students of alcohol in August 2009;
3.saying to herself the words “black bastards” to refer to two Indigenous students in July or October 2009; and
4.falsely denying on 3 March 2010 in response to allegations which had been put to her by Annesley on 9 February 2010:
a) that she had acted as alleged in sub-paragraphs 1-3 above; and
b) that she had made particular statements to Annesley staff members on 22 September 2009, 29 October 2009 and 28 January 2010.
A. FACTUAL BACKGROUND
Annesley College
Annesley College is a body corporate pursuant to section 4 of the Annesley College Act 1920 (SA). At all material times until the end of 2011, Annesley conducted a school at Wayville for girls ranging from reception to year 12. The school was divided into a junior school (reception to year 6), middle school (years 7-10) and senior school (years 11 and 12). Annesley also conducted a boarding house for boarders in years 7-12.
At the end of 2011, Annesley closed the middle school, the senior school and the boarding house. From the beginning of 2012, Annesley has only conducted a junior school for day students.
School hierarchy and personnel
Linda Douglas was the Principal at material times from 2007 to 2010. Subject to strategic direction by the School Board, she had managerial responsibility for school operations, including the employment of all professional staff (apart from Principal and Deputy Principal).
The Principal chaired the Executive. The Executive met fortnightly, usually on a Monday at lunch time. The Executive comprised the following educational staff: the Principal, Deputy Principal, Head of Senior School, Head of Middle School, Head of Junior School and Head of Boarding. At the end of 2008, the Head of Middle School left Annesley. Her role was subsumed by the Head of Senior School (renamed Head of Secondary School).
The Executive also included at various times the Business Manager and the newly created position of Director of Development.
Each of the educational staff members of the Executive (other than the Principal) had additional responsibility for one or two areas beyond their primary responsibility. They usually held the position of Director in respect of each such additional area. For example, in August 2009, the Head of Junior School was also Director of Early Learning and the Head of Secondary School was also Director of Learning Pathways.
Susan Richards was Deputy Principal at material times from 2008 to May 2010. She was also the Director of International Programs and Director of Human Resources. Radmilla Lalic was Manager of International Students and Alumni and Executive Assistant to Ms Richards.
Ms Ramsey was Head of Boarding at all material times. In 2009, she was also Director of Community Relations and de facto Director of Student Wellbeing. From July 2008, Samara Jaeger was Administration Assistant, Student Wellbeing and Personal Assistant to Ms Ramsey. Some time after that, she also took on the role of junior mistress in the Boarding House.
Up to about September 2009, Julie McNamara had been the Business Manager. In about September 2009, she left the school and was replaced by Stuart Mossman. The Business Manager was responsible for financial and some other non-professional operations of the school. At material times, Grant Cirillo was Director of Campus, responsible for campus facilities.[1] Julie Hatherly was the Payroll Officer, reporting to the Business Manager.
[1] For a relatively brief period, he was a member of the Executive.
In 2009-2010, Claire McAdam was the Director of Development.
Boarding House hierarchy
Ms Ramsey was Head of Boarding at all relevant times. Sally Tonkin was Deputy Head of Boarding. Sally Tonkin, Jean Bradey, Bev Turner and Lisa Hassan composed the senior Boarding House mistresses. There were also six junior Boarding House mistresses.
There were regular meetings of the Boarding House mistresses, chaired by the Head of Boarding. They were held three weekly on a Friday morning or otherwise on a Thursday morning.
Ms Ramsey and Ms Tonkin had worked together as Head and Deputy Head of Boarding since 2005. Up to and including the first term of 2009, they enjoyed a good working relationship.
Ms Bradey was the longest serving senior Boarding House mistress, having been at Annesley since about 1987. Ms Turner joined Annesley as a senior Boarding House mistress at the beginning of 2008. The evidence does not disclose when Ms Hassan became a senior mistress.
The Boarding House was divided between two different buildings. Patchell housed the junior boarders (years 7 to 9). Harris housed the senior boarders (years 10 to 12).
Ms Ramsey
At the time of the trial, Ms Ramsey was aged 47. She attended Annesley College as a boarder in years 11 and 12. She obtained a Bachelor of Education in 1986, majoring in Home Economics and Business Education. She worked for the Department of Education as a teacher at the Cleve Area School between 1986 and 1988.
In 1989, Ms Ramsey was employed as a teacher at Annesley College. She then returned to the Department of Education as a teacher at Parafield Gardens High School in 1990, Aberfoyle Park High School in 1991, Mt Barker High School between 1992 and 1999 and Glenunga International High School between 2000 and 2002. At the last three schools, Ms Ramsey also performed various roles as manager or co-ordinator of certain years, areas or programs.
Ms Ramsey was Head of Boarding at Annesley College from February 2003 until her dismissal in March 2010. She taught two classes (10 lessons per week) in 2003 and 2004. Her work was allocated so that 60 per cent of her work was as Head of Boarding and 40 per cent was teaching. Upon joining Annesley, she resided with her family in a house on the College grounds. She continued to reside in that house until 1 February 2010, when she unilaterally moved to a house away from the school.
It was a term of the contract entered into between the parties in 2002 that there be a formal performance review at the end of 2003. In early 2004, the performance review was conducted by the then principal (Ms Gaertner-Jones) and then Business Manager (Ms McNamara). On 8 April 2004, Ms Gaertner-Jones wrote to Ms Ramsey confirming that the outcome of the performance review was positive.
In 2005, Ms Ramsey was appointed to the new position of Director of Student Services (subsequently renamed Director of Student Wellbeing). The Director of Student Services was responsible to the Principal for the strategic development and implementation of the College’s student support services. Her new role involved dealing with students’ behavioural, social and psychological issues (in a negative sense) and the promotion of student health and wellbeing (in a positive sense). Her teaching commitment was reduced by 50 per cent. Her work was allocated 60 per cent Head of Boarding, 20 per cent Student Services and 20 per cent teaching.
At the beginning of 2007, Ms Ramsey relinquished the role of Director of Student Wellbeing to the new Head of Middle School. Ms Ramsey was appointed instead Director of Community Relations. This role involved communications and relationships with parents, supporters, old scholars and the broader community.
At the end of 2008, the Head of Middle School left Annesley. Ms Ramsey resumed the Student Wellbeing role on a de facto basis.
In about August 2009, it was agreed between Ms Ramsey and Ms Douglas that during the 2010 year Ms Ramsey would relinquish her role as Director of Community Relations and her de facto role as Director of Student Wellbeing and would only work as Head of Boarding with a 20 per cent teaching load. This was on the basis that she would resume a directorship role in 2011, but probably in a different role involving Flexible Learning.
Employment contracts
On 20 November 2002, Annesley and Ms Ramsey executed an Employment Contract (“the 2003 Contract”). The 2003 Contract provided for the appointment of Ms Ramsey as Head of Boarding (60 per cent) and a teacher (40 per cent) for three years from 1 February 2003 to 31 January 2006. It provided for a salary package comprising cash salary, superannuation and the value of accommodation, meals and services to be provided by Annesley for Ms Ramsey. Clause 25 conferred upon each party the right to terminate the contract by either 12 weeks’ notice or payment/forfeiture of 12 weeks’ salary in lieu of notice.
On 11 April 2005, the parties executed a new Employment Contract (“the 2005 Contract”). The 2005 Contract provided for the continuing employment of Ms Ramsey as Head of Boarding as well as in the new role of Director of Student Services. The term of the appointment was five years from 1 February 2005 to 31 January 2010. The terms of the 2005 Contract were similar to the terms of the 2003 Contract, including clause 25 which gave to the parties the same rights of termination as clause 25 of the 2003 Contract.
During 2009, there were communications between Ms Douglas and Ms Ramsey on the topic of the parties entering into a third employment contract for three years (with the possibility of a further two years dependent on a performance appraisal) from 1 February 2010. It is in dispute whether those communications culminated in a contract for a term of three years (or five years) commencing on 1 February 2010. I make findings on that issue in Part C below. Nothing ultimately turns on this issue because it is common ground that, by reason of the parties’ conduct, the terms of the 2005 Contract continued to apply after 1 February 2010.
Overview of 2009
Ms Ramsey gave evidence that, since joining Annesley, she had always worked long hours, ranging from 60 to 100 hours per week. She gave evidence of a number of developments and issues which arose during 2009 (including her resuming the de facto role of Director of Student Wellbeing). I infer that these matters increased the pressures upon her in the course of the working week.
Ms Ramsey gave evidence that, at the beginning of September 2009, she was involved in a car accident, as a result of which she was taken to hospital and diagnosed as suffering from whiplash injury.
By September 2009, Ms Ramsey was experiencing difficulty sleeping. She was prescribed sleeping tablets (Stilnox) by her general practitioner.
By December 2009, Ms Ramsey was experiencing difficulties eating. She was experiencing headaches, and was prescribed Endep for the headaches. She also developed shingles.
Annesley’s teaching staff generally returned to work after the summer holidays on 18 January 2010. Ms Ramsey was unable to return to work due to sickness. Her general practitioner issued to her sickness certificates progressively covering the period from 18 January to 18 March 2010.
No medical certificates were tendered at trial and no medical evidence was adduced. However, I infer that Ms Ramsey was under considerable pressure throughout 2009, which from term three onwards is likely to have affected her performance at work. Those pressures increased from the end of October 2009 as a result of events the subject of this action.
Term two 2009
In 2009, term two commenced on Monday 27 April and ended on Friday 3 July.
On the first day of term, as was customary, there was a meeting between the Boarding House staff (including Ms Ramsey) and the boarders’ parents. There was then a dinner attended by the boarders and Boarding House staff.
On 27 April, some time before the parents’ meeting, Mr Cirillo informed Ms Ramsey that a fire door had been damaged by boarders, necessitating its replacement at a cost of approximately $1,800. It is Annesley’s case that Ms Ramsey informed the boarders’ parents and separately the boarders that evening that the cost to replace the fire door was $5,000. Ms Ramsey accepts that she referred to a figure of $5,000 at the meeting(s), but gave evidence that she referred to that figure as the total cost of damage in the Boarding House for the year to date, including (but not limited to) the fire door which was the largest item. I address this contested issue in Part F below.
On 23 May, Ms Tonkin sent an email to Ms Ramsey addressing the school’s records which showed her rostered hours and actual hours worked to date during term two. This led to a number of communications between Ms Tonkin and Ms Ramsey concerning Ms Tonkin’s hours. The hitherto good relationship between Ms Ramsey and Ms Tonkin began to deteriorate at this time.
On 23 June, a conversation took place between Ms Douglas and Ms Ramsey. The conversation concerned, amongst other things, the topic of the parties entering into a contract with effect from 1 February 2010 for three years and a further two years subject to a performance review. On 24 June 2009, Ms Douglas wrote a letter to Ms Ramsey confirming their conversation on the previous day. I address these matters in Part C below.
Term three 2009
Term three began on Monday 20 July and ended on Friday 25 September 2009.
On 28 July, there was a meeting of the Corporate Services Executive. It was decided that there would be a review of the College’s Corporate Services (meaning matters other than teaching), with the terms of reference to be discussed after the budget process (“the Corporate Services Review”).
On 4 August, the Executive attended a planning day at the Edinburgh Hotel. During the course of the day, Ms Ramsey had a discussion with Ms Douglas. Ms Ramsey told Ms Douglas that she would like to take leave from her directorship positions (Community Relations and Wellbeing) throughout 2010 because her daughter was going to be doing year 12 in that next year. I address this conversation in Part C below.
On 21 August, a year 11 Boarding House student informed Ms Turner that she did not wish to take her prescribed antibiotics because she was going to a party and intending to drink alcohol. It is Annesley’s case that Ms Ramsey gave that student and another student permission to drink two glasses of alcohol at a party. This is denied by Ms Ramsey. I address this contested issue in Part F below.
On Friday 28 August, after school finished, Ms Ramsey drove to Melbourne for the weekend to watch the football, returning in the evening of Monday 31 August. Ms Ramsey considered it was not necessary to inform Ms Tonkin that she was going to be away from Adelaide for a “long” weekend. Ms Tonkin took the view at the time that, as Deputy Head of Boarding, she should have been informed of Ms Ramsey’s absence. It does not appear that she informed Ms Ramsey of that view at the time.
On Tuesday 15 September, Ms Ramsey travelled to the Riverland to attend the Riverland field days on behalf of the school, returning on the evening of Thursday 17 September. Ms Ramsey gave evidence that she attended the Riverland field days each year in September, they were recorded on the school calendars and in the diaries and it was not necessary to inform Ms Tonkin specifically that she was going to be away. Ms Tonkin took the view at the time that, as Deputy Head of Boarding, she should have been specifically informed of Ms Ramsey’s absence.
On 15 September, one of the Boarding House students developed severe pain and was prescribed strong pain medication by a visiting general practitioner. At the conclusion of her shift at 10.15 pm, Ms Tonkin took the student home to monitor her and returned her to the Boarding House in the morning. She obtained the consent of the student’s parent, but did not obtain written evidence of the consent in contravention of the school’s protocol. When Boarding House staff worked on the nightshift at the Boarding House (“sleepover”), they were paid for four hours. Ms Tonkin recorded four hours at the normal sleepover rate in her time book.
When Ms Ramsey learnt that Ms Tonkin had taken a student home, she disapproved because Ms Tonkin had not checked with Ms Ramsey, Ms Douglas or Ms Richards, and had not obtained the parent’s written consent and a police check for Mr Tonkin had not been provided to the Boarding House. On 22 September, Ms Ramsey called Ms Tonkin to the payroll office in the presence of the payroll officer, Ms Hatherly. Ms Ramsey informed Ms Tonkin that her action had been inappropriate and she would not be paid for the four hours claimed in her time book. On any view she was very stern with Ms Tonkin. This incident marked a further deterioration in the relationship between Ms Ramsey and Ms Tonkin.
In late September (towards the end of term), Ms Douglas and Ms Ramsey discussed the composition of a panel to undertake Ms Ramsey’s appraisal. They agreed that the panel would comprise Ms Douglas, Ms Richards, Ms Bradey and Ms Oliphant. A performance review document was to be distributed to each member of the panel as well as Ms Ramsey and completed by 12 October. Once each had been completed, Ms Richards was to collate all of the information. There was then to be a meeting between Ms Douglas and Ms Richards and Ms Ramsey to discuss the collated document and complete the performance appraisal.
Individual performance review documents were due to be completed by 12 October. Ms Oliphant and Ms Ramsey completed a performance review form.[2] Ms Bradey did not. A third performance review form was tendered.[3] The evidence was vague as to who was the author of that form. Ms Douglas gave evidence that it might have been authored by Ms Richards or by herself, but she could not tell. It appears that Ms Richards completed a performance review form, although it may have amalgamated comments from the other forms. Ms Richards was not clear in her recollection.
[2] Exhibit P1 tabs 28 and 26 respectively.
[3] Exhibit P1 tab 27.
Ms Richards gave evidence that the performance appraisal process was not completed. In particular, the procedure was that she would complete a consolidated document based on responses from all members of the panel as well as the employee concerned and then distribute it to the Principal, the employee concerned and Ms Hatherly for filing in the personnel file. This did not occur. There would then be a meeting with the employee to discuss that document. No such meeting occurred. I find that the performance appraisal process for Ms Ramsey was never completed. It was overtaken by other events, specifically the issues involving Ms Tonkin from 29 October 2009 onwards.
Term four 2009
Term four began on Monday 12 October and ended on Friday 11 December 2009.
The “last chapel service” for the boarders was usually held on the first Sunday of term four. In 2009, it was held on Sunday 18 October. Boarding House staff (whether rostered to work that day or not) were welcome to attend, but did not receive specific invitations. In previous years, Ms Tonkin had been actively involved in the preparation for and been part of the service. In 2009, Ms Tonkin was not invited by Ms Ramsey to participate in the preparation for or as part of the service.
On 15 October, Ms Ramsey received by email from St Peters College an invitation to Heads of Boarding and Assistant Heads of Boarding to attend the annual Christmas dinner on Friday 13 November. The email requested RSVPs by 22 October. Ms Ramsey accepted the invitation on her own behalf but did not accept the invitation on behalf of Ms Tonkin. When Ms Tonkin learnt that she was not to attend the Christmas dinner, she felt left out.
On 22 October, there was a special meeting addressing international students between Ms Ramsey, Ms Richards and Ms Tonkin. Ms Tonkin made notes of the matters discussed. Subsequently, she prepared a report which summarised each of the matters raised by Ms Ramsey, Ms Richards and Ms Tonkin. She also included four additional matters which had not been discussed. She made provision in the report for comments by the recipients of the report.
On 29 October,[4] the regular boarding house meeting was held between Ms Ramsey, Ms Tonkin and the Boarding House senior mistresses. One of the items on the agenda was international students. When that agenda item was reached, Ms Tonkin handed out a copy of her report of the meeting of 22 October. When Ms Ramsey read the report, she became alarmed and told Ms Tonkin that the report was inappropriate. Ms Tonkin became very distressed, started to cry and left the meeting. This marked the most dramatic deterioration in the relationship between Ms Ramsey and Ms Tonkin.
[4] There was some confusion whether the meeting was on 28 or 29 October. Nothing turns on the difference and I assume for simplicity that it was 29 October.
After the meeting, there was a discussion between Ms Bradey, Ms Turner and Ms Tonkin. Reference was made to the possibility of litigation involving Ms Tonkin, Ms Ramsey and the school. Reference was made to the possibility of Ms Bradey and Ms Turner being subpoenaed. There is a dispute about precisely what was said during this conservation. I address this contested issue in Part F below.
On 30 October,[5] Ms Tonkin met with the school’s student counsellor, Ms Oliphant. Ms Oliphant recommended that Ms Tonkin see a counsellor with Access-Ocar. Ms Tonkin made an appointment to see a counsellor at Access-Ocar on Friday 6 November (subsequently rescheduled by the counsellor to Monday 9 November). Both Ms Turner and Ms Bradey also attended counselling sessions at Access-Ocar.
[5] If the boarding house meeting was on 28 October, this meeting occurred on 29 October.
In the meantime, Ms Ramsey and Ms Richards met with Ms Douglas. They discussed what had occurred on 29 October. It was agreed that the Boarding House staff concerned (Ms Tonkin, Ms Bradey and Ms Turner) would be encouraged to seek counselling with Access-Ocar. It was agreed that it was desirable that there be a mediation between Ms Ramsey and Ms Tonkin and that the former Reverend of the school, Dr Adrian Brown, should be invited to conduct the mediation. Ms Ramsey spoke to Dr Brown, who agreed to mediate.
On Tuesday 3 November, Ms Ramsey sent an email to Ms Tonkin, Ms Bradey and Ms Turner informing them of their ability to use the services of Access-Ocar at the cost of the school. She said that she had spoken to Dr Brown who was happy to act as a mediator and that he proposed a mediation later that week, initially between Ms Tonkin and herself. On 4 November, Ms Tonkin responded that she wished to meet first with the Access-Ocar counsellor before meeting with Dr Brown.
On Monday 9 November, Ms Tonkin attended a counselling session at Access-Ocar. The counsellor recommended that she report the incidents involving Ms Ramsey to SafeWork SA or the Working Womens’ Unit. On 10 November, Ms Tonkin attended at SafeWork SA and reported the incidents. Later that day, she received a telephone call from Dr Brown to arrange a mediation session with Ms Ramsey. She told him that she had reported the incidents and felt very uncomfortable proceeding to a mediation. As a result, the proposed mediation did not proceed.
Ms Tonkin gave evidence that she did not intend or expect that, as a result of her complaint to SafeWork SA, Ms Ramsey would be dismissed or suspended from her position as Head of Boarding. Rather, she hoped that it would lead to an improvement in their relationship.
Over the weekend of 14-15 November, Ms Ramsey travelled to Sydney for her daughter’s birthday. She did not inform Ms Tonkin that she was going to be away. She gave evidence that Ms Tonkin was not going to be working over that weekend and that she spoke to Ms Bradey about her impending absence. Again, Ms Tonkin took the view at the time that, as Deputy Head of Boarding, she should have been informed.
On 20 November, Ms Tonkin, together with Ms Bradey and Ms Turner, meet with Ms Douglas. Ms Tonkin informed Ms Douglas that she had made a report about Ms Ramsey to SafeWork SA. She had done this because she believed that would be the best way to get action because both Ms Douglas and Ms Richards were friendly with Ms Ramsey.
On 20 November, SafeWork SA sent by facsimile to Ms Douglas a letter dated 19 November stating that SafeWork SA had received a request from Ms Tonkin for investigation of inappropriate behaviour by Ms Ramsey. SafeWork SA requested various documentation. Ms Douglas received that facsimile immediately after her meeting with Ms Tonkin, Ms Bradey and Ms Turner.
Ms Douglas then met with Ms Richards and in turn Ms Richards accompanied Ms Ramsey to Ms Douglas’ office. Ms Douglas informed Ms Ramsey of receipt of the letter from SafeWork SA. Ms Richards may or may not have been present at the latter meeting.
Later that day, in light of the SafeWork SA letter, Ms Richards chaired the regular meeting with the senior Boarding House mistresses in lieu of Ms Ramsey. Ms Richards explained to the Boarding House mistresses the procedure for making complaints within the school. Ms Tonkin, Ms Bradey and Ms Turner told Ms Richards that they did not feel comfortable going to Ms Douglas, Ms Richards or Ms Ramsey as they were generally regarded as a tight-knit group likely to discuss issues amongst themselves.
Ms Douglas engaged Rod Reid (EMA Consulting) to advise the school in relation to the issues between Ms Tonkin and Ms Ramsey the subject of the SafeWork SA letter. It was agreed that the first step would be for Mr Reid to attempt to facilitate a resolution of the issues between Ms Tonkin and Ms Ramsey. The first stage of that facilitation would be for him to meet separately with Ms Tonkin and then with Ms Ramsey.
On 24 November, Ms Douglas sent letters (drafted by Mr Reid) to each of Ms Tonkin and Ms Ramsey referring to the SafeWork SA letter and arranging meetings with Mr Reid for 25 November and 26 November respectively.
On 24 November, there was a meeting of the Corporate Services Executive chaired by Mr Mossman and attended, amongst others by Ms Douglas (as Principal), Ms Richards (as Deputy Principal) and Ms Ramsey (as Director Community Relations). It was reported that the Corporate Services Review in 2010 would be conducted by Ms Douglas, Ms Richards and Mr Mossman, with the assistance of an external consultant.
On 25 November, Mr Reid met with Ms Tonkin. She gave to him a typed summary of issues under five headings which she had prepared for the meeting, together with a number of pre-existing documents. She gave him details of the issues which she had with Ms Ramsey. On 1 December, Mr Reid sent a draft statement to Ms Tonkin for clarification and confirmation. On 10 December, she signed an amended statement.
On 26 November, Mr Reid met with Ms Ramsey and her solicitor Rosey Batt. Ms Batt sought details of the allegations which had been made by Ms Tonkin. Mr Reid identified each of those issues in detail based upon his notes taken and documents received at the meeting with Ms Tonkin the day before. Ms Ramsey said during the meeting that she had a number of issues with Ms Tonkin and that her working relationship with Ms Tonkin may have become irretrievably broken. As a result of the meeting, Mr Reid formed a pessimistic view of the prospects of a resolution between Ms Ramsey and Ms Tonkin.
On 1 December, Mr Reid sent by email to Ms Batt a letter confirming that the purpose of the meeting on 26 November had been to seek an expeditious resolution of the issues in the best interests of all parties rather than a formal disciplinary meeting. Mr Reid went on to say that he had provided full details of the allegations at the meeting on 26 November and Ms Batt had made detailed notes. He sought a response from Ms Ramsey to the allegations, either orally at another meeting or in writing.
On 2 December, Ms Batt sent an email to Mr Reid requesting that the allegations be put in writing. On 8 December, Mr Reid sent by email to Ms Batt a letter setting out the allegations in 15 numbered paragraphs. He said that Ms Tonkin considered that she had been bullied and harassed by Ms Ramsey.
On 7 December, Ms Douglas met separately with Ms Bradey, Ms Jaeger and Ms Turner.
On 11 December, Ms Batt sent by email to Mr Reid a letter dealing with the contractual position as between the school and Ms Ramsey and inquiring what process the school was currently following. Mr Reid responded by email attaching a letter dated 18 December which addressed the contractual position. As to process, he said that an informal resolution now appeared untenable and unlikely and he requested Ms Ramsey’s response to the allegations. On 23 December, Ms Batt wrote to Mr Reid. She said that she had advised Ms Ramsey not to provide a substantive response to his letter of 8 December until they knew what process was being followed. She also raised the possibility of a resolution to be discussed in the new year.
On 14 December, at the last Executive meeting for the year, there was extensive discussion of the Corporate Services Review. It was reported that proposals were being sought from five external consultants, including McLaughlin Hodge Mitchell.
School holidays 2009-2010
On 22 December, Mr Reid and Ms Batt had a discussion about a potential resolution. It appears that the discussion was on a without prejudice basis. No evidence was adduced by other party of the content of the discussion. Between 22 December 2009 and the end of January 2010, the school and Ms Ramsey engaged in without prejudice communications with a view to a resolution. By the beginning of February 2010, it became apparent that there would not a resolution.
Term one 2010
School staff returned to work on Monday 18 January 2010. Ms Ramsey did not return to work. She was given by her general practitioner a sickness certificate saying that she would be unfit for work from 18 January to 18 February. She was subsequently given a further medical certificate (or certificates) covering the period from 18 February to 18 March.
As Deputy Head of Boarding, Ms Tonkin acted in the position of Head of Boarding from 18 January 2010 onwards (ultimately throughout term one and term two). I infer that another teacher taught Ms Ramsey’s classes during the first term of 2010.
At the first Executive meeting of the year, it was reported that McLaughlin Hodge Mitchell had been selected as the external consultant for the Corporate Services Review.
At the end of January/beginning of February, Mr Mossman spoke to a number of school personnel in relation to Ms Ramsey. They included Mr Cirillo, Ms Bradey, Ms Turner, Ms McAdams and Ms Hatherly. It was arranged that EMA Consulting should interview those staff members. Because Mr Reid was absent at the time, the interviews were undertaken by another EMA employee, Helen Peace.
In the first week of February, Ms Peace interviewed and prepared typed draft witness statements for each of Mr Cirillo, Ms Bradey, Ms Turner, Ms McAdams and Ms Hatherly.
Mr Reid then prepared a letter to be sent in the name of Mr Mossman to Ms Ramsey care of Ms Batt setting out a number of additional allegations based upon the interviews. The letter also reiterated (word for word) the matters which had been set out in Mr Reid’s original letter of 8 December 2009. On 9 February, Mr Mossman sent the letter as drafted by Mr Reid to Ms Batt.
On 10 February, Ms Batt sent a letter to Mr Mossman asking a series of questions concerning the procedure being followed by the school in relation to the investigation, to which Mr Mossman responded by letter dated 18 February (drafted by Mr Reid). On 23 February, Ms Batt sent a further letter to Mr Mossman requesting further particulars of the allegations contained in Mr Mossman’s letter of 9 February and taking issue with Mr Mossman’s response in relation to the series of questions concerning process.
On 3 March, Ms Batt sent a 21 page letter to Mr Mossman responding in detail to the allegations contained in Mr Mossman’s letter dated 9 February. By the letter, Ms Ramsey denied that she had engaged in any improper conduct.
On 11 March, Mr Mossman sent to Ms Batt a letter (drafted by Mr Reid) responding to her letter dated 23 February and, insofar as it addressed procedural rather than substantive matters, her letter dated 3 March.
In the meantime, Mr Mossman spoke to a number of school staff who were involved in the incidents the subject of his letter dated 9 February. Those staff included Ms Tonkin, Ms Turner, Ms Bradey, Ms Hatherly, Ms McAdams and Mr Cirillo. Mr Mossman prepared a draft table which set out in separate columns a paraphrase of the original allegations contained in his letter dated 9 February, Ms Ramsey’s response contained in Ms Batt’s letter dated 3 March, further statements obtained from school staff by Mr Mossman since 3 March, and a conclusion.
On Friday 12 March, Mr Mossman provided the draft table to Mr Reid for his feedback. On Monday 15 March, Mr Reid sent an email to Mr Mossman with his comments and an assessment of the allegations.
On 15 March, McLaughlin Hodge Mitchell provided a first draft of its Corporate Services organisation review. The first draft was not tendered, but the final report dated 1 April was tendered and received as an exhibit. McLaughlin Hodge Mitchell recommended a re-organisation of Corporate Services. They included four alternative options. Each option involved a new position of Director Corporate Services reporting to the Principal and a Boarding House Manager reporting to the Director Corporate Services (in lieu of a Head of Boarding). Each option retained a Director Community Relations reporting directly to the Principal. The report only addressed positions and not individual personnel filling those positions.
On Tuesday 16 March, Mr Mossman completed his table. On the same day, a meeting took place between Ms Douglas, Mr Mossman, Mr Reid and Annesley’s solicitor, David Ey of Piper Alderman. Mr Mossman gave copies of his table to the other participants either before or at the meeting. The allegations were discussed.
On Wednesday 17 March, Ms Batt wrote to Mr Mossman seeking clarification of a number of statements contained in his letter of 11 March. She requested that he provide a finding on the allegations by no later than midday 18 March.
On 16 or 17 March, Ms Douglas decided to terminate summarily Ms Ramsey’s employment. On 17 March, Mr Mossman asked Mr Reid to draft a letter in the name of Ms Douglas to Ms Batt informing Ms Ramsey that her employment was summarily terminated. Mr Reid sent to Mr Mossman a draft letter.
On Friday 19 March, Mr Reid sent to Ms Douglas and Mr Mossman a redrafted version of the letter regarding Ms Ramsey’s summary termination, which Ms Douglas signed and sent to Ms Batt on that day. The letter stated that Annesley was satisfied that Ms Ramsey had engaged in bullying and harassment and serious acts of impropriety and had deliberately tried to mislead its investigation by providing unfactual responses. It said that her actions had given rise to a serious breach of trust which in turn had led to an irretrievable breakdown in the employment relationship. It said that Annesley was satisfied that Ms Ramsey had engaged in serious and wilful misconduct warranting summary dismissal as justified at common law.
Subsequent events
As at 19 March 2010, Ms Ramsey’s salary package at Annesley totalled approximately $132,000 per annum.
After Ms Ramsey’s termination, Ms Tonkin, as Deputy Head of Boarding, continued as acting Head of Boarding until August 2010.
On 29 March 2010, Ms Ramsey commenced employment with Des’s Adelaide Pty Ltd. Her employment was in the head office of the holding company of a group of companies which carry on businesses involving passenger transport and tourism. She is responsible for business development, marketing, compliance, staff training and debtors. Her commencing salary was $57,000 per annum. She remains in that employment.
On 8 July 2010, Ms Ramsey instituted this action against Annesley claiming damages for breach of contract.[6]
[6] She also sued for misleading conduct and breach of duty of care, but those causes of action were abandoned during trial (closing address): see Part B below.
In August 2010, a new Boarding House Manager was appointed under a new structure in accordance with the recommendations of McLaughlin Hodge Mitchell. Ms Tonkin continued as Deputy Manager until her resignation from Annesley at the end of 2010.
At the end of 2011, Annesley closed the middle school, senior school and Boarding House.
In late 2011/early 2012, Walford advertised for a principal. In mid 2012, Seymour advertised for a principal. One of those positions was filled by the person who had been deputy principal at Loreto. In turn, Loreto then advertised for a deputy principal.
In November 2012, a number of reports of the trial appeared in the media. The reports referred to the opening addresses by Ms Ramsey and Annesley, including reference to Annesley’s case that Ms Ramsey was sacked for bullying and racism.
B. PLEADED CASES AND WITNESSES
Plaintiff’s pleaded case
There were a number of departures at trial (including during final addresses) from Ms Ramsey’s pleaded case.
During final address, Ms Ramsey abandoned her pleaded causes of action of breach of duty of care[7] and breach of the Fair Trading Act 1987 (SA).[8]
[7] Fifth statement of claim [17], [18] (in part), [20] (in part), [38.2], [40] (in part), [41] (in part) and Part 2 [3].
[8] Fifth statement of claim [21]-[28], [29]-[31] (in part), [38.3], [39]-[41] (in part) and Part 2 [4].
Ms Ramsey had pleaded that it was an implied term of her contract of employment that Annesley would manage complaints:
1. in accordance with the Complaints Policy;
2. confidentially, reasonably, competently, fairly, and in accordance with equity, good conscience and the principles of natural justice; and
3. so as to take all reasonable steps to prevent its management of the complaint from adversely affecting the plaintiff’s employment or future employment opportunities.[9]
[9] Fifth statement of claim [16.2.1]-[16.2.3].
In her closing address, Ms Ramsey made submissions (albeit brief) on the alleged implied term that Annesley would comply with the Complaints Policy but made no submissions at all in support of the contention that the other two terms were implied or were breached. In the circumstances, my understanding is that she abandoned her case in respect of those two implied terms. However, out of an abundance of caution, I have addressed briefly the questions of the implication of those alleged terms in Part D below.[10]
[10] See [210]-[211] below.
Ms Ramsey had pleaded that Annesley’s termination of her employment contract was solely motivated by its financial distress at the time and that it terminated the contract purely to save costs knowing that it did not have good cause to terminate.[11] During closing address, Ms Ramsey did not make substantive submissions in support of her case in this respect, although she expressly stated that she did not abandon this case. Accordingly, I have dealt with this case on the merits in Part D below.[12]
[11] Fifth statement of claim [29]-[38].
[12] See [370]-[378] below.
Conversely, Ms Ramsey did not plead that it was an implied term of the contract that each party would not, without reasonable and proper cause, conduct itself in a manner calculated and likely to destroy or seriously damage the relationship of confidence and trust between employer and employee (“the mutual trust and confidence term”). Annesley itself relies upon the mutual trust and confidence term against Ms Ramsey, the alleged breach of which it contends entitled it to terminate the contract of employment. At trial, and particularly in final address, Ms Ramsey alleged that Annesley had breached that term by its conduct of the investigation and communications with Ms Ramsey leading up to the purported dismissal.[13] Annesley did not object to Ms Ramsey conducting her case on this basis. Accordingly, I have dealt with Ms Ramsey’s case of breach of the mutual trust and confidence term on the merits.[14]
[13] See plaintiff’s closing address [203]-[216].
[14] See [337]-[369] below.
During final address, I granted permission to Ms Ramsey to amend her statement of claim to allege as a head of loss the legal costs incurred in the action by way of mitigatory expenditure.[15] Annesley did not oppose that amendment.
[15] Fifth statement of claim [42.5]-[42.7].
During final address, Ms Ramsey claimed that she was entitled to 12 weeks’ salary in lieu of notice and payment of long service leave entitlements by way of debt. She had not sought a remedy by way of debt but had sought damages for breach of contract which encompassed the same amounts. I conclude below that she is entitled to seek a remedy by way of debt under the principle contained in rule 223 of the Supreme Court Civil Rules 2006 (SA).
Defendant’s pleaded case
Annesley pleaded that Ms Ramsey engaged in serious and wilful misconduct and pleaded 14 particulars thereof.[16]
[16] Third defence [20.1].
At trial, without objection from Ms Ramsey, Annesley conducted its case on the basis that the alleged misconduct was a breach of the mutual trust and confidence term.
In relation to paragraphs [20.1.11] to [20.1.14] of the pleaded defence, Annesley gave oral particulars of the allegations on the second day of trial.[17] As Annesley presented its case, it became apparent that those particulars needed to be modified. While they were not formally amended, the case was conducted on the basis of alleged breaches by Ms Ramsey as defined during final address.
[17] T113-126.
The first 10 particulars of misconduct related to alleged bullying by Ms Ramsey of Ms Tonkin in eight respects,[18] kitchen staff[19] and senior boarding house mistresses.[20] As a result of the disclosure of Mr Reid’s file and the evidence of Ms Douglas, Mr Reid and Ms Tonkin, it became progressively apparent during the course of the trial that Annesley had not relied upon those matters as grounds for summary termination. Ultimately, during final address, Annesley did not rely upon those matters as grounds for summary termination. However, it contends that they are relevant to other matters, including credit.
[18] Third defence [20.1.1]-[20.1.8].
[19] Third defence [20.1.9].
[20] Third defence [20.1.10] as particularised on the second day of trial.
Plaintiff’s witnesses
Ms Ramsey called Ms Richards and Ms Lalic as witnesses. Annesley did not challenge their credibility or reliability. In general, I accept Ms Richards’ and Ms Lalic’s evidence as to the events which they each described to the extent that they were able to describe them according to their recollection.
Ms Richards and Ms Lalic also gave what might be termed “character” evidence in respect of Ms Ramsey: specifically in respect of the suggestions that Ms Ramsey permitted students to drink alcohol (both Ms Richards and Ms Lalic) and that she used the derogatory term “black bastards” (Ms Lalic). I accept this evidence as “character” evidence and have given it some weight (but no more than the appropriate weight) in my assessment of the issue whether Ms Ramsey used the term “black bastards”.
In their written witness statements, each of Ms Richards and Ms Lalic also gave relatively general evidence in subjective and conclusionary terms as to their assessment of other staff at the school, their conduct and such matters. This was also the case in respect of witnesses called by Annesley whose evidence-in-chief comprised (at least in part) written witness statements (Ms Bradey, Ms Turner and Mr Cirillo). Generally, I did not find such evidence to be of assistance.
Defendant’s witnesses
Annesley called five former employees: Ms Douglas, Mr Mossman, Mr Cirillo, Ms Tonkin and Ms Bradey. None of the witnesses now works for or is associated with Annesley. Annesley also called Mr Reid.
Annesley tendered, pursuant to section 34C(1) and (1a) of the Evidence Act 1929 (SA), a written witness statement of Ms Turner signed by her on 12 February 2010. Annesley proved that Ms Turner was “unfit by reason of bodily or mental condition to attend as a witness” by calling her general practitioner, Dr Podgorski. Ms Ramsey did not ultimately contest the admissibility of Ms Turner’s written witness statement under section 34C or its reception. I received it as evidence of the facts contained in it under section 34C. I exercise the appropriate caution in relation to that evidence in light of the fact that Ms Turner was not subject to cross-examination.
Ms Ramsey accepts that, with the exception of Mr Mossman, each of the witnesses called by Annesley was an honest witness.
My assessment of Mr Mossman is that he was an honest witness who gave his evidence to the best of his recollection. Ms Ramsey contends that he was untruthful in his evidence about follow ups with staff members following receipt of Ms Batt’s letter dated 3 March 2010.
1. Ms Ramsey contends that Mr Mossman’s evidence that he followed up Ms Bradey was untruthful because it contradicted Ms Bradey’s evidence about follow ups. I reject that contention. Ms Bradey gave evidence that she was not shown or told about Ms Batt’s letter and that Ms Ramsey’s response was not put to her. Ms Bradey’s evidence is not inconsistent with Mr Mossman having had a further discussion with Ms Bradey after 3 March 2010.
2. Ms Ramsey contends that Mr Mossman’s evidence that he followed up Ms Tonkin was untruthful because Ms Tonkin gave evidence that, while Mr Mossman asked her a number of questions, he did not have Ms Batt’s letter in front of him, did not show her the letter and did not say that he was putting Ms Ramsey’s response to allegations made against her. Ms Tonkin’s evidence does not contradict the evidence of Mr Mossman and on the contrary confirms it.
3. Ms Ramsey contends that Mr Mossman’s evidence that he followed up Mr Cirillo was untruthful because Mr Cirillo in his evidence characterised the follow up as being “just in conversation”. Mr Cirillo’s evidence does not contradict Mr Mossman’s evidence and on the contrary confirms it.
Ms Ramsey invites me to reject Mr Mossman’s evidence that he gave the final version of his table to the participants of the meeting on 16 March 2010 either at or before that meeting. I accept Mr Mossman’s evidence that it was the “final” version of the table (exhibit D18) which was discussed on 16 March rather than the earlier draft which he had sent to Mr Reid on 12 March. It is logical that Mr Mossman would have provided to the participants the most recent version of the table. It is unlikely that he would have undertaken further work on the table after Ms Douglas made the decision to dismiss summarily Ms Ramsey. Mr Reid’s evidence is not inconsistent with this: Mr Reid did not have a clear recollection which particular version of the table was discussed at the meeting. The mere fact that the “final” version of the table does not appear in Mr Reid’s file does not indicate that it was not used at the meeting. Ms Douglas had completed her evidence before exhibit D18 was produced, and the mere fact that she was not referred to it does not demonstrate that it was not the version used at the meeting.
Mr Mossman was particularly vague in his recollection of his discussions with Ms Hedges, but nothing turns on the timing or detail of those discussions. In general, I accept Mr Mossman’s evidence as to the events which he described to the extent that he was able to describe them according to his recollection.
I found Ms Douglas generally to be a reliable witness. Her recollection was relatively poor in relation to certain events, particularly compared to that of Ms Ramsey. This is not surprising, given the time which has passed since those events, the fact that Ms Douglas has moved on to another school and another State and the fact that the events in question would have had relatively more importance to Ms Ramsey than to Ms Douglas. Generally, I accept Ms Douglas’ evidence as to the events which she described to the extent that she was able to describe them according to her recollection.
I found Ms Bradey generally to be a reliable witness. In Part F below, I make some findings that she misunderstood or may have misunderstood what was said on occasions, but this does not detract from her general reliability as a witness. Subject to those exceptions, generally I accept Ms Bradey’s evidence as to the events which she described to the extent that she was able to describe them according to her recollection.
I found Ms Tonkin generally to be a reliable witness. There were misunderstandings which arose in 2009 between Ms Tonkin and Ms Ramsey and they each had and have different perceptions of what was occurring and what each was saying. However, this does not detract from Ms Tonkin generally being a reliable witness. Subject to this and the qualifications made in Part E below, I generally accept Ms Tonkin’s evidence as to the events which she described to the extent that she was able to describe them according to her recollection.
I found Mr Cirillo generally to be a reliable witness. In Part F below, I find that Mr Cirillo misunderstood what Ms Ramsey said on two occasions (July or October 2009 and 28 January 2010). I also find that he was mistaken in his recollection that he spoke to Ms Douglas and Mr Mossman in either July or October 2009 concerning Ms Ramsey using the term “black bastards”. These matters cause me to have reservations about the accuracy of Mr Cirillo’s evidence in relation to the discussion with Ms Ramsey in July or October 2009. Subject to those qualifications, generally I accept Mr Cirillo’s evidence as to the events which he described to the extent that he was able to describe them according to his recollection.
I found Mr Reid generally to be a reliable witness. Ms Ramsey contends that his judgment (and indeed that of Ms Douglas and Mr Mossman) was flawed in the conclusion reached concerning Ms Ramsey’s conduct which ultimately led to Ms Douglas’ decision to dismiss summarily Ms Ramsey. To the extent that Ms Ramsey’s submissions address Mr Reid’s subjective state of mind (and that of Ms Douglas and Mr Mossman) and are relevant to either credibility or the adequacy of the procedures adopted by him (and Ms Douglas and Mr Mossman), I reject the criticisms made by Ms Ramsey. It does not follow from this that the objective facts (as assessed at trial) justified summary termination: that is a different question.
Ms Ramsey contends that Annesley should have called Ms Hatherley, Ms McAdam, Ms Hassan, Ms Jaeger, Ms Hedges, junior Board House mistresses and kitchen staff to give evidence concerning various matters. Ms Ramsey contends that Annesley should have called Dr Keightly (chairperson of the School Council), boarders’ parents who attended the meeting on 27 April 2009 and the two students to whom Ms Ramsey had allegedly given permission to drink alcohol. Ms Ramsey invites me to make an inference that the evidence of each of those potential witnesses would not have assisted Annesley’s case.[21]
[21] Pursuant to the principle identified in Jones v Dunkel (1959) 101 CLR 298.
I decline to draw any such inference. The failure to call the two students resulted in Annesley failing to prove its case as opposed to giving rise to an inference that their evidence would not have assisted its case. As to the former staff members of Annesley identified by Ms Ramsey, there is no particular reason to consider them as being in the camp of Annesley as opposed to Ms Ramsey at this point. For example, based on the evidence which I heard at trial, it is more likely that Ms Jaeger would be regarded as being in Ms Ramsey’s camp rather than Annesley’s camp. In any event, beyond the obvious fact that evidence was not adduced from the persons identified by Ms Ramsey, I have no hesitation in making my findings on the evidence before me as opposed to what evidence might possibly have been called by either party.
Plaintiff’s evidence
Annesley contends that Ms Ramsey was not an honest or reliable witness. Most of Annesley’s contentions are made by reference to Ms Ramsey’s responses contained in Ms Batt’s letter dated 3 March 2010 and her evidence at trial concerning the allegations made against her by Ms Tonkin as formulated by Mr Reid on 8 December 2009 and allegations made by the school as formulated by Mr Reid in Mr Mossman’s name on 9 February 2010. I address those matters insofar as they involve Ms Tonkin’s allegations in Part E and insofar as they involve other allegations in Part F below. For the reasons given in those Parts, I do not consider that these matters reflect adversely upon Ms Ramsey’s honesty as a witness. There were misunderstandings which arose in 2009 between Ms Tonkin and Ms Ramsey and they each had and have different perceptions of what was occurring and what each was saying. However, this does not detract from Ms Ramsey generally being an honest witness.
Annesley contends that Ms Ramsey was evasive during cross-examination on four topics. In general, during cross-examination, Ms Ramsey was short in her answers and did not elaborate or volunteer additional matters. However, I do not regard her responses as being evasive or reflecting adversely upon her honesty or the reliability of her evidence.
The personality of each witness impacts upon the manner in which they answer questions. For example, the personalities of Ms Ramsey and Ms Tonkin are very different and this was reflected in the way in which they respectively answered questions. The difference between their personalities was also a major factor in the deterioration in their relationship between May and November 2009 after having had a very good relationship for several years before that time. My assessment of the manner in which Ms Ramsey answered questions does not adversely impact on my assessment of her honesty or reliability.
Subject to the qualifications identified in Parts E and Part F below, generally I accept Ms Ramsey’s evidence as to the events which she described to the extent that she was able to describe them according to her recollection.
C. EXISTENCE (IDENTITY) OF CONTRACT
Ms Ramsey’s primary case is that in either June or August 2009 (affirmed in December 2009) the parties entered into an express fixed term contract of employment for the period 1 February 2010 to 31 January 2015 (or alternatively to 31 January 2013).[22]
[22] Fifth statement of claim [8]-[12].
Ms Ramsey’s secondary case is that, in the alternative, by the same conduct over the period from June 2009 to December 2010, the parties entered into an implied employment contract for the same fixed term.
Ms Ramsey’s tertiary case is that, in the further alternative, by their conduct in continuing the employment relationship beyond the expiry of the 2005 Contract on 31 January 2010, the parties entered into an implied employment contract, terminable on notice.
Annesley denies that the parties entered into any contract in June or August 2009 or that the parties at any time entered into a fixed term contract in respect of the period from 1 February 2010 onwards. However, Annesley accepts that, by their conduct, the parties entered into an implied contract terminable on notice with effect from 1 February 2010.
Express fixed term contract
Ms Ramsey’s pleaded case that there was an express contract is put by way of the following cascading alternatives:
1. an oral contract made on 23 June 2009;
2. in the alternative, a partly written, partly oral contract comprising the letter from Ms Douglas to Ms Ramsey dated 24 June 2009, accepted orally by Ms Ramsey sometime between 23 June and 4 August 2009;
3. in the further alternative, an oral contract made on 4 August 2009.
The test for determining the existence of a contract is objective.[23] As a result, evidence of the purely subjective state of mind of one party or of internal communications entirely within one party’s camp is generally inadmissible as to the existence and construction of a contract.[24]
[23] Ermogenous v Greek Orthodox Community of SA Inc [2002] HCA 8; (2002) 209 CLR 95 at [25] per Gaudron, McHugh, Hayne and Callinan JJ; Pacific Carriers Ltd v BNP Paribas [2004] HCA 35; (2004) 218 CLR 451 at [22] per Gleeson CJ, Gummow, Hayne, Callinan and Heydon JJ; Toll (FGCT) Pty Ltd vAlphapharm Pty Ltd [2004] HCA 52; (2004) 219 CLR 165 at [38], [40] per Gleeson CJ, Gummow, Hayne, Callinan and Heydon JJ.
[24] Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337 at 348, 352 per Mason J; DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423 at 429 per Stephen, Mason and Jacobs JJ; Central City Pty Ltd v Montevento Holdings Pty Ltd [2011] WASCA 5 at [25] per Murphy JA (Buss JA agreeing).
Oral contract 23 June 2009
Ms Ramsey’s first pleaded case is that the parties entered into an express contract which was wholly oral on 23 June 2009.
On 23 June 2009, a conversation took place between Ms Ramsey and Ms Douglas. The conversation was confirmed by letter from Ms Douglas to Ms Ramsey dated 24 June 2009.
Ms Ramsey gave evidence of the content of the conversation. That evidence was not challenged in cross-examination or contradicted by Ms Douglas.
Ms Ramsey did not remember the exact words but remembered the gist of the conversation. Her evidence was as follows:
Q.What was the substance of what she said when she first raised the employment contract?
A.I’ve got to get your contract sorted out for next year. It was like We’ve got to get onto this … I responded with That’s good. I then asked whether it was Community Relations or Wellbeing. She said Wellbeing … I said How are we going to split up those roles?... she said Oh, well, we’ll get that sorted out … later in the year … I just went Yep, sure. She said You’ll need to have a performance review. I said Fine, that’s not a problem. I cannot tell you whether she said three or five years. I can’t honestly say anything about how long except that I believed when I walked out of there that the conversation was it was five years if I got through my performance review, it was three if there were any issues of concern. That was my - what I believed that the conversation was we’d had but I cannot tell you how that conversation went.
Q. Was anything else said between you?
A.She laughed about the fact she had to do my performance review. It was a friendly collegial conversation. I don’t recall specifics about it. I do recall Linda saying Sue had been onto her to get it done.
On 24 June 2009, Ms Douglas wrote a letter to Ms Ramsey confirming their conversation. The letter throws some light upon the conversation. The letter includes the following passage:
I am pleased to offer you a three year contract as Director of Student Wellbeing/Head of Boarding, with the possibility of an extension of a further two years, dependent on the outcome a performance appraisal process [sic]. I will meet with you early next term to discuss the responsibilities, terms and conditions of the contract extension and the structure of the appraisal process. This process will provide you with valuable feedback regarding your performance and will also enable us to review the scope of your role with regard to moving into the new strategic plan for 2010-2012.
I would like to take this opportunity to thank you for your ongoing commitment to the College and acknowledge your professionalism and expertise in carrying out your role in challenging times. I wish you and your family a safe and relaxing holiday break.
Ms Ramsey gave evidence that the subject matter of the second sentence quoted above had not in fact been mentioned during the conversation on 23 June. However, she also gave evidence that she did not challenge Ms Douglas in relation to that sentence when she received the letter.
In her account of the conversation set out at [146] above, Ms Ramsey did not include any words said by her to Ms Douglas to the effect that she accepted the offer of employment for three/five years. She had earlier given evidence in conclusionary terms as follows:
Q. Did you accept the offer?
A. Yes.
Q. When did you do that?
A. Verbally right there and – and when we had the meeting on the 23rd.
Ms Ramsey pleads that on 23 June 2009 the parties entered into an oral contract of employment for a fixed term of three years together with a further term of two years subject to Ms Ramsey undertaking a satisfactory performance review appraisal. I reject that contention.
In determining whether parties have entered into a legally binding contract, issues of intention to enter into legal relations and certainty of terms, while conceptually separate, are often interrelated in practice.[25]
[25] Australian Broadcasting Corporation v XIVth Commonwealth Games Limited (1988) 18 NSWLR 540 at 548 per Gleeson CJ (Hope and Mahoney JJA agreeing).
The background to and context of the conversation on 23 June 2009 was that the parties had previously entered into formal written detailed contracts of employment in 2002 (for three years) and 2005 (for five years). In those circumstances, it is very unlikely that they intended to enter into a verbal contract for three or five years in 2009. There is nothing in the conversation as narrated by Ms Ramsey which indicates that the parties intended to depart radically from their previous practice and intended to enter into a legally binding wholly oral contract on 23 June.
In addition, it is evident from the conversation as narrated by Ms Ramsey that the parties contemplated that the length of the employment would depend on a performance appraisal. There was no detailed discussion about the performance appraisal, including the important aspect of its timing (before commencement of the period of employment to be covered by the contract, after commencement, before expiration of the three year period, or otherwise). The parties did not discuss any terms of the contract beyond the topic of the period of employment. The previous contracts had included extensive terms on extensive topics.
I have reached the conclusion that the parties did not enter into any contract on 23 June 2009 without having regard to subsequent events. On the issue of existence (as opposed, perhaps, to terms) of a contract, evidence of subsequent conduct by the parties is admissible.[26] The subsequent conduct by the parties confirms my conclusion that they did not enter into a contract on 23 June 2009. Ms Douglas’ letter dated 24 June 2009 is inconsistent with such a contract having been entered into, and Ms Ramsey did not take issue with that letter after she received it.
[26] Howard Smith & Co Ltd v Varawa (1907) 5 CLR 68 at 77 per Griffith CJ; Barrier Wharfs Ltd v W Scott Fell & Co Ltd (1908) 5 CLR 647 at 668-669 per Griffith CJ; Australian Broadcasting Corporation v XIVth Commonwealth Games Ltd (1988) 18 NSWLR 540 at 547-548 per Gleeson CJ (Hope and Mahoney JJA agreeing).
In September 2009, Ms Douglas and Ms Ramsey agreed on the composition of the panel for a performance appraisal and in October some members of the panel completed appraisal forms. The appraisal process was not completed. The fact that the appraisal was an important element in the structure of the contract contemplated on 23 June (directly impacting the length of the contract) and yet it was not discussed until September suggests that the parties did not in June reach finality on the terms of the contract.
Written offer and oral acceptance
Ms Ramsey’s second pleaded case is, in the alternative, that the contract was effected by an offer made by Annesley by Ms Douglas’ letter dated 24 June 2009 which was orally accepted by Ms Ramsey some time between 23 June and 4 August. I reject that contention.
I have set out at [147] above the second half of Ms Douglas’ letter dated 24 June 2009. The first half of the letter read as follows:
I write to confirm our conversation on Tuesday 23 June 2009 regarding your contract which is due to finish at the end of this year.
The Executive will play an important role in leading the College during the next strategic plan for 2010 - 2012. Over the past twelve months a strong sense of collaborative practice has developed amongst members of Executive and this has been highly evident in the leadership of staff and students. In your role as Head of Boarding and Director of Community Relations as well as previously as Director of Student Wellbeing you are an integral part of this leadership team and I value highly your skills, knowledge and expertise. In recognition of this and your ongoing contribution and commitment to excellence at Annesley College …
In Burazin,[199] the essential facts are set out at [450] above. The Full Bench of the Industrial Relations Court did not need to decide the claim for damages for distress for breach of the implied term of mutual trust and confidence on 12 April[200] because it held that Ms Burazin was entitled to compensation under the statutory cause of action conferred by the Workplace Relations Act 1996 (Cth). However, it discussed the then recent decisions of the English Court of Appeal in Bliss v South East Thames Regional Health Authority[201] and Malik.[202] Importantly, Burazin was decided before the House of Lords delivered its judgment in Malik. Wilcox CJ, von Doussa and Marshall JJ said:
Two issues have to be addressed in determining whether damages are recoverable for distress caused by a breach of the implied term: whether the breach is one capable of giving rise to liability for damages, as distinct from founding a right to repudiate the contract; [203] and, if so, whether the damages are limited by the rule in Addis.
As it seems to us, there ought to be little doubt about the answer to the second question. Having regard to the purpose of the implied term, it is difficult to dispute that distress is a natural and probable effect of a breach. So if damages are an available remedy, Addis ought not to apply. But we have a doubt about the first question. Although it might seem strange to concede the existence of an implied contractual term but deny its capacity to give rise to liability in damages, it must be remembered that the term is intended to bolster an ongoing relationship. …
Although we have difficulty with the reasoning in both Bliss and Malik, they are both decisions of the English Court of Appeal. It would be a significant step for this court to refuse to follow them. It is unnecessary to take that step in this case. As will appear, we have reached the conclusion that Ms Burazin is entitled under her statutory claim to be compensated for the distress she suffered as a result of her treatment by the respondent on 12 and 13 April.[204]
(emphasis added, citations omitted)
[199] (1996) 142 ALR 144.
[200] As to a claim by Ms Burazin based on breach by summary dismissal, see [451] above.
[201] [1985] IRLR 308.
[202] [1995] 3 All ER 545.
[203] After the decision of the Court of Appeal in Burazin, the House of Lords held that damages are a remedy available for breach of the implied term: see Mahmud, Johnson, Eastwood and Edwards. Annesley does not contend that damages is not an available remedy, provided causation and remoteness tests are satisfied.
[204] (1996) 142 ALR 144 at 153-154.
In Russell,[205] the essential facts are set out at [452] above. The Court of Appeal assumed that there was an implied term of mutual trust and confidence, but held that it was not breached. Giles and Campbell JJA decided this claim on this basis. Basten JA alone went on to consider issues of causation of loss on the assumption that Mr Russell had succeeded on the issue of breach. Basten JA said:
There remains the question whether the appellant can claim damages for any of the three heads referred to above for breach of the implied terms, on the basis, contrary to the preferred reasoning set out above, that such terms should relevantly be implied in the contract and were breached. His argument in that respect depended on a two-step process. The first required that the principle in Addis be understood as limited to the holding that “the plaintiff could not recover in an action for damages for breach of contract in respect of his injured feelings and loss of employment prospects arising from the harsh and humiliating manner of his dismissal”, as explained by Mason CJ in Baltic Shipping (at 361). By contrast, such damages could be recovered if they flowed from a breach of a contractual term other than termination without proper notice. …
To uphold a claim to damages because of steps taken by an employer leading up to a dismissal has three consequences which require consideration. The first is that, because the loss will almost inevitably flow from the termination of employment, rather than the manner in which the decision to terminate was made, the effect will be to sidestep the rule in Addis and hence authorities (including Baltic Shipping) upholding the rule as the law in this country. Secondly, as recognised by the House of Lords in Eastwood, such a course is likely to be inconsistent with the statutory remedies for unfair dismissal, a principle applied by this Court in State of New South Wales v Paige, albeit in the context of a proposed duty of care in tort. Thirdly, as also noted in Eastwood, the provision of damages for breach of such an implied term otherwise than in relation to termination of employment, creates significant anomalies, for example, by creating a right to recover in the less serious case of suspension of employment, but not in the case of dismissal: see Eastwood (at 528 [30]-[33]).
In this country, the continued adherence to Addis supports the avoidance of any variation in principle which would have anomalous consequences. ...
It follows that, even assuming success in relation to the existence of the implied term and breach thereof, there was no basis for an award in the present case of general damages for distress, humiliation, injury to feelings or loss of “reputation”.[206]
(citations omitted)
[205] (2008) 72 NSWLR 559.
[206] (2008) 72 NSWLR 559 at [58], [63]-[65].
In State of South Australia v McDonald (“McDonald”),[207] the Full Court of this Court held that there was no implied term of mutual trust and confidence in that case due to the particular statutory regime governing Mr McDonald’s employment. Doyle CJ, White and Kelly JJ made the following observations about the implied term:
The authorities concerning the implied term indicate that the statutory regimes which apply after a dismissal has occurred may be decisive in the determination of the remedies available for a breach of the implied term of mutual trust and confidence. In this way the evolution of the implied term has been adapted to the statutory and regulatory environment in which the term has been applied. For example, in Johnson v Unisys, the House of Lords declined to recognise that a breach of the implied term in the manner of termination of an employment contract gave rise to a remedy in damages. It was held that the common law should not develop so as to duplicate the remedies available to an employee under the statutory unfair dismissal regime. Similarly, in Russell, the Court of Appeal gave as one reason for not recognising a right to damages for damage to reputation, distress and disappointment arising from a dismissal that to do so would be inconsistent with the statutory unfair dismissal regime in New South Wales. [208]
(citations omitted)
[207] [2009] SASC 219; (2009) 104 SASR 344.
[208] (2009) 104 SASR 344 at [238].
In Shaw,[209] the essential facts are set out at [454] above. A specially constituted court of five Justices allowed the appeal and reinstated the plea of breach of the implied term of mutual trust and confidence. Barrett JA (Beazley, McColl, Macfarlan JJA and McClelland CJ at CL agreeing) said:
[209] [2012] NSWCA 102; (2012) 219 IR 87.
To the extent that there is a claim for damages for breach of the implied term, the claim relates to loss of earnings and earning capacity, on the basis that the conduct of the respondent in breach of the implied term deprived the appellants of the ability to earn remuneration and related benefits during the period stipulated in para 13 and that that deprivation came home to the plaintiffs in the form of earnings actually lost.
… Recovery of such damages would prima facie be in accordance with:
(a) the observation in Foaminol Laboratories Ltd v British Artid Plastics Ltd (above), approved by a majority of the House of Lords in Malik (and by Lord Steyn in Johnson), that “if pecuniary loss can be established, the mere fact that the pecuniary loss is brought about by the loss of reputation caused by a breach of contract is not sufficient to preclude the plaintiffs from recovering in respect of that pecuniary loss”;
(b) the observation of the majority in Malik that recovery of financial loss in respect of damage to reputation caused by breach of contract is not necessarily excluded;
(c) the observation of Lord Nicholls (with the concurrence of two other Law Lords) in Malik that Addis does not preclude the recovery of damages where the manner of dismissal involved breach of the trust and confidence term and this caused financial loss; and
(d) his Lordship's further observation that damages for breach of contract are for “making good financial loss”.
There is also the point that the para 8 conduct and the para 11(a) to 11(e) conduct alleged against the respondent occurred during the currency of the employment and before the annulment of the appellants’ appointments. Thus, to the extent that breach of the implied term alleged in para 11 is relied on as a basis for claiming damages, it arises from alleged matters distinct from the annulment (or dismissal) itself.
…
In summary, there is no authority of the High Court or an intermediate appeal court in Australia that will unquestionably compel dismissal of the claim for damages for breach of contract advanced in para 13 of the third further amended statement of claim; and, even if the trial judge felt some obligation not to depart from decisions of the House of Lords … the significant qualifications upon Addis created by Malik and Johnson will leave room for the appellants’ claim to be addressed. There is a cogent basis for arguing that damages for breach of contract may be awarded as claimed in para 13 if the existence of the implied term and breach of it are established.[210]
[210] (2012) 219 IR 87 at [113], [114], [115], [119].
In Australia, the dicta of the Full Bench of the Industrial Relations Court in Burazin suggest that such damages are recoverable (assuming, as Annesley concedes, breach of the implied term of mutual trust and confidence is capable of giving rise to a remedy in damages). The dictum of Basten JA (the only Judge to express a view) in Russell suggests that such damages are not recoverable. The Full Court in McDonald did not decide the question. The recent decision of the enlarged Court of Appeal of the Supreme Court of New South Wales in Shaw suggests that such damages are recoverable in principle. Accordingly, there is no binding appellate court authority in Australia against recoverability, but the appellate court decisions in Burazin and Shaw suggest that such damages are recoverable.
I conclude that, as a matter of principle, such damages would have been potentially recoverable if, contrary to my conclusion above, Ms Ramsey had succeeded in proving breach of the mutual trust and confidence term.
Assessment of the facts
I now assume (contrary to my conclusion at [458] above) that causation of loss of Ms Ramsey’s opportunity to obtain alternative teaching employment is to proceed by reference to the actual manner and grounds of dismissal identified by Annesley. In this respect, it is appropriate to distinguish between past and future opportunities before and after trial.
Loss of opportunity 2010-2012
In respect of the loss of opportunity up to the date of trial (November 2012), Ms Ramsey contends that she suffered a loss of opportunity to obtain positions at relevant schools as Head of Boarding, Deputy Principal or Principal.
Head of Boarding
Ms Ramsey gave evidence that, since her dismissal in March 2010, she monitored advertisements for relevant positions at relevant independent schools. Her evidence was that the only Head of Boarding position advertised was Head of Boarding at Scotch College (a co-educational school). However, she gave an approximate date for the advertisement as February or March 2010. She did not prove that applications for the position were still open as at 19 March 2010.[211] She gave evidence that no other positions of Head of Boarding were advertised after her dismissal in March 2010 at a school for which she would have applied but for Annesley’s breach of contract. [212] She did not expressly give evidence that the five girls’ schools have retained positions of Head of Boarding filled by qualified teachers (compared with the position at Annesley after mid 2010).
[211] In any event, on Ms Ramsey’s evidence, I find that on the balance of probabilities she would not have applied for that position even if applications were still open as at 19 March 2010. Her evidence was that she had a strong preference for a position in a girls’ school as opposed to a co-educational school. She also said that she was not in a frame of mind to apply for the position. She did not in fact apply for the position.
[212] Ms Ramsey did give evidence that there were positions as Head of Boarding at St Peters Boys School and Prince Alfred College, but both schools are for boys and she accepted that she would not have had significant prospects of obtaining those positions in any event.
In those circumstances, Ms Ramsey failed to prove that any opportunities arose over the period from 19 March 2010 to November 2012.
Principal and Deputy Principal
Ms Ramsey gave evidence that two Principal positions and one Deputy Principal position were advertised over the period, each of which was apparently advertised over the course of 2012.
Ms Ramsey chose not to apply for any of those positions. She gave as her reason that she believed that she would be obliged to disclose the fact that she had been dismissed by Annesley for alleged misconduct and that this would destroy her prospects of appointment. The fact that she did not apply means that potential evidence which would have resulted from her application is not available to me to make any assessment about her prospects of success.
If Ms Douglas had terminated Ms Ramsey’s employment on 19 March 2010 by giving 12 weeks’ notice (as opposed to a summary dismissal on the grounds of misconduct), it is likely that Ms Douglas would not have provided a favourable reference to Ms Ramsey in all of the circumstances. This would need to be factored into any assessment of the value of a lost opportunity.
Ms Ramsey did not adduce evidence from a recruitment or personnel consultant or a principal from any school as to the criteria likely to be applied by the schools in selecting for those positions, the likely number and qualities of the applicants for such positions or Ms Ramsey’s prospects of being appointed to such positions. In the absence of such evidence, I have no basis to find that, but for Annesley’s breach, Ms Ramsey would have had any significant prospect or valuable opportunity of obtaining such a position.
Ms Ramsey herself expressed the opinion that she was well qualified for a position as Principal or Deputy Principal. Leaving aside her obvious self-interest in expressing such an opinion, no basis was laid to establish that she has the requisite knowledge to be able to make such an assessment. Ms Ramsey’s counsel cross-examined Ms Douglas about Ms Ramsey’s prospects of obtaining positions as a Principal or Deputy Principal, but Ms Douglas felt unable to express an opinion on that question.
Ms Douglas was asked in cross-examination about Ms Ramsey’s prospects of obtaining alternative employment at an executive level given her summary dismissal on the grounds of misconduct. She expressed the opinion that those prospects would have been poor. However, Ms Ramsey did not adduce any evidence on the basis of which I could assess the quantum of any reduction in her prospects or whether she would otherwise have had any significant prospects of appointment to such a position.
Ms Ramsey has failed to demonstrate that, but for Annesley’s breach, she would have had a valuable opportunity of obtaining appointment to those positions.
Loss of future opportunity
Ms Ramsey claims that she will suffer in future a diminished opportunity to obtain an executive level position at a relevant school over the period from November 2012 (the date of trial) until 2031 when she would have retired at the age of 67.
Over such a long period of approximately 19 years, it is inevitable that most positions at an executive level at the relevant schools would fall vacant and would need to be replaced. However, notwithstanding the size of her claim in respect of the future loss of opportunity, Ms Ramsey did not adduce any evidence, whether from a recruitment or personnel consultant or a school principal or otherwise, on the basis of which I could make an assessment of her prospects of obtaining such a position assuming no breach of contract by Annesley.
If Ms Ramsey were to make an application for such a position in the future, she would be in a position to disclose to her prospective employer that this Court has held that she was not guilty of misconduct. This would reduce any diminution in her prospects of obtaining such positions compared to the hypothesis that Annesley had not committed the breach of contract in the first place. Ms Ramsey did not adduce any evidence from a recruitment or personnel consultant, school principal or otherwise as to whether there would be a material difference between her prospects of appointment as between these two scenarios.
Ms Ramsey has failed to establish that she will suffer a loss of a valuable opportunity to obtain alternative employment at executive level in the teaching profession.
Conclusion
As a general principle, the mere fact that there are difficulties in estimating a loss does not mean that a court does not do its best to assess the quantum of that loss on the materials available to it.[213] This principle applies to the assessment of the value of a lost opportunity.[214] However, where a court has no basis to assess whether there was a real or significant chance that the alleged benefit would have been obtained but for the breach, no damages will be awarded.[215] If it is the defendant’s breach which precludes proof of value, that is one thing. If it is a failure by the plaintiff to adduce evidence relevant to value, that is another thing. In the present case, Ms Ramsey failed to adduce any evidence on the basis of which I could conclude that she suffered a loss of opportunity of a real or significant value.
K. MITIGATORY EXPENDITURE
[213] See, for example, Fink v Fink (1946) 74 CLR 127 at 134-135 per Latham CJ and Williams J, 143 per Dixon and McTiernan JJ; McRae v Commonwealth Disposals Commission (1951) 84 CLR 377 at 411-412 per Dixon and Fullagar JJ.
[214] See, for example, Commonwealth of Australia v Amann Aviation Pty Ltd (1991) 174 CLR 64 at 125-126 per Deane J.
[215] See, for example, Fink v Fink (1946) 74 CLR 127 at 134-135 per Latham CJ and Williams J, 143 per Dixon and McTiernan JJ; McRae v Commonwealth Disposals Commission (1951) 84 CLR 377 at 411-412 per Dixon and Fullagar JJ; Commonwealth of Australia v Amann Aviation Pty Ltd (1991) 174 CLR 64 at 125-126 per Deane J.
Ms Ramsey claims that her legal costs incurred in the institution and prosecution of this action constitute mitigatory expenditure which forms a recoverable head of loss.[216] This is on the premise that the costs were incurred for the purpose of vindication and were calculated to have the effect of reducing (or eliminating) Ms Ramsey’s future economic loss.
[216] Fifth statement of claim [42.5]-[42.7].
As a matter of general principle, if a plaintiff reasonably incurs expenditure in an attempt to mitigate her recoverable losses, the amount of that expenditure is itself recoverable as a head of loss.[217] Conversely, if the expenditure is incurred to avoid an irrecoverable head of loss, the expenditure is not recoverable as a head of loss.[218]
[217] Russell v The Trustees of the Roman Catholic Church for the Archdiocese of Sydney (2008) 72 NSWLR 559 at [45], [53] per Basten JA (Giles and Campbell JJA agreeing).
[218] Russell v The Trustees of the Roman Catholic Church for the Archdiocese of Sydney (2008) 72 NSWLR 559 at [53]-[57] per Basten JA (Giles and Campbell JJA agreeing).
If I had held that Ms Ramsey’s future economic loss were recoverable, I would have upheld this head of loss. However, I have held that Ms Ramsey’s future economic loss is not recoverable. Accordingly, this head of loss fails.
L. DAMAGES FOR DISTRESS
Ms Ramsey claims damages for hurt, humiliation and distress as a result of Annesley’s breach of contract.[219]
[219] Fifth statement of claim [42.8].
Principle
I have addressed above the principle established by Addis v Gramophone Company Limited,[220] which holds that damages for distress due to the manner of wrongful termination are not recoverable.
[220] [1909] AC 488.
In Baltic Shipping Co v Dillon,[221] the High Court held that the general rule in contract is that damages for distress and disappointment caused by breach of contract are not recoverable. There are several exceptions, including where the breach of contract causes a recognisable personal injury (physical or psychiatric) or physical (as opposed to mental) inconvenience and where the object of the contract is to provide enjoyment, relaxation or freedom from molestation. The general rule was expressed by Brennan J:
[221] (1993) 176 CLR 344.
where disappointment of mind is no more than a mental reaction to a breach of contract and damage flowing therefrom, the law has treated such a mental reaction as too remote. Thus, in Fink v Fink, Dixon and McTiernan JJ held that, in assessing the amount to be awarded for breach of contract, “[r]esentment, disappointment and the loss of esteem of friends are not proper elements”. In my opinion, there is a sound policy underlying this rule.[222]
[222] (1993) 176 CLR 344 at 368-369.
Deane and Dawson JJ said:
One of the general rules relating to the assessment of compensatory damages for breach of contract which has been accorded the status of settled principle is the rule that a plaintiff is not entitled to recover damages for the “disappointment of mind”, distress and injured feelings “occasioned by the breach of contract”. … Notwithstanding that the rule is based upon pragmatism rather than logic, we are unable to agree with the suggestion to be found in some recent judgments that it should now be effectively abolished by judicial decision.[223]
And McHugh J said:
Damages for breach of contract cannot ordinarily be awarded for distress or disappointment arising from that breach. …
...
If the matter were free from authority, the object of an award of damages for breach of contract and the principles of causation and remoteness would require the conclusion that damage for disappointment or distress, resulting from breach of contract, was compensable if it was within the reasonable contemplation of the parties when the contract was made. … However, the rule in Addis has stood for the best part of a century. In this country it has suffered little, if any, inroad by judicial decision. Furthermore, in Fink two of the three members of the majority accepted the common law rule to be that stated by Pollock C.B. in Hamlin.
It is still open to this Court to declare that damages for distress and disappointment in contract cases are not subject to any special rules. However, I do not think that the step should be taken in this case. Counsel for Mrs. Dillon did not argue that the general rule laid down in Hamlin and confirmed in Addis should be rejected.[224]
(citations omitted)
[223] (1993) 176 CLR 344 at 380-381.
[224] (1993) 176 CLR 344 at 394, 404-405.
By contrast, Mason CJ (Toohey and Gaudron JJ agreeing) considered that the scope of the exceptions to it rendered the authority of the general rule somewhat uncertain, but did not go as far as to hold that the rule no longer exists. It follows that, unless and until the High Court decides otherwise, the general rule continues to apply, subject to the exceptions identified in Baltic Shipping Co v Dillon.[225]
[225] (1993) 176 CLR 344.
In Burazin v Blacktown City Guardian,[226] Ms Burazin sought damages for shock, humiliation and distress for breach of contract. She claimed that her employer breached the contract of employment by breaching the implied term of mutual trust and confidence and by wrongful termination. Wilcox CJ, von Doussa and Marshall JJ rejected her claim at common law. They said:
In recent years the courts have recognised that there are some types of contract in relation to which distress is a natural and probable consequence …
As it seems to us, the High Court rejected the opportunity in Baltic Shipping to throw over the constraints imposed by Hamlin and Hadley v Baxendale and their successors. It approved the awarding of damages for distress only in a limited range of cases. Although there was some difference in the precise formulations put forward by their Honours, none was broad enough to cover distress resulting from a wrongful dismissal. If such damages are to be awarded, it must be after rejection, at High Court level, of the Addis conclusion that employment contracts are to be treated like other commercial contracts for the purposes of the rules in Hadley v Baxendale.[227]
(citations omitted)
[226] (1996) 142 ALR 144.
[227] (1996) 142 ALR 144 at 149-151.
In Russell v The Trustees of the Roman Catholic Church, Archdiocese of Sydney,[228] Baxten JA (Giles and Campbell JJA agreeing) said:
subject to exceptions, this head of damage is excluded by the principle stated by Lord Loreburn LC in Addis (at 491), that damages are not recoverable “for the injured feelings of the servant, or for the loss he may sustain from the fact that his having been dismissed of itself makes it more difficult for him to obtain fresh employment”. Nevertheless, damages of these kinds are recoverable, the appellant contended, on the basis of the exceptions accepted in Baltic Shipping …
Baltic Shipping undoubtedly recognised exceptions to the general rule, in particular where a breach of contract gives rise to physical injury, psychiatric illness or even physical inconvenience, or where the subject matter of the contract is the provision of pleasure or enjoyment, the expectation of which is disappointed by the breach …
The appellant did not seek to establish personal injury of the kind which might give rise to a claim for damages; nor can it be said that the contract was one which provided for pleasure or entertainment. Accordingly, as senior counsel for the appellant conceded, no such claim for damages was tenable, arising purely from the breach constituted by the termination without reasonable notice.[229]
(citations omitted)
[228] (2008) 72 NSWLR 559.
[229] (2008) 72 NSWLR 559 at [55]-[57].
In Coyne v Commercial Equity Corporation Ltd[230] and Thorpe v Lochel,[231] the Court of Appeal of the Supreme Court of Western Australia held that the general rule (subject to exceptions identified in Baltic Shipping Co v Dillon[232]) was that damages for distress are not recoverable for a breach of contract. In New South Wales v Paige,[233] Spigelman CJ (Mason P and Giles JA agreeing) proceeded on the same basis in the course of considering whether the employer owed a duty of care to the employee.[234]
[230] (1998) 20 WAR 109 at 119-122 per Kennedy J (Franklyn J agreeing).
[231] [2005] WASCA 85; (2005) 31 WAR 500 at [23] per Steytler P, [40] per Roberts-Smith JA, [145] per Pullin JA.
[232] (1993) 176 CLR 344.
[233] [2002] NSWCA 235; (2002) 60 NSWLR 371.
[234] (2002) 60 NSWLR 371 at [132]-[154], esp [133].
This approach has been adopted by single Judges in this Court.[235]
[235] Thorpev South Australian National Football League (1974) 10 SASR 17 at 38 per Jacobs J; McDonald v State of South Australia (2008) 172 IR 256 at [541]-[542] per Anderson J; Lennon v The State of South Australia [2010] SASC 272 at [678]-[688] per Layton J.
Ms Ramsey relies upon the decision of Byrne J in Quinn v Gray.[236] In that case, an arbitrator found that a college breached the implied term of mutual trust and confidence (which ultimately led to the dismissal of the Principal of the school), that this breach caused distress and disappointment and that damages for distress were recoverable within the exception referred to in Baltic Shipping Co v Dillon[237] because the term (as opposed to the contract as a whole) was directed towards the personal protection of the employee. Byrne J held that the college had not established “manifest error” as required to overturn the arbitration.[238] This authority does not assist Ms Ramsey because it concerns a breach of the mutual trust and confidence term and in any event only decided whether or not the arbitrator had committed “manifest error”.[239]
[236] [2009] VSC 136; (2009) 184 IR 279.
[237] (1993) 176 CLR 344.
[238] (2009) 184 IR 279 at [25]-[31].
[239] Bryne J also held that the arbitrator had not committed manifest error in awarding damages for loss of the opportunity to seek alternative employment while still employed and working out her notice. It is not clear whether the arbitrator found that such loss was caused by a breach of the mutual trust and confidence term. If not, Byrne J did not explain why the principle in Addis v Gramophone Co Ltd [1909] AC 488 did not apply.
In Nikolich v Goldman Sachs J B Were Services Pty Ltd,[240] Wilcox J found that the employer breached contractual terms relating to health and safety, harassment and concerns and grievances. The employee suffered a psychiatric injury which Wilcox J held was caused by the breaches. Wilcox J expressed the view that the case may have fallen within the exception identified in Baltic Shipping Co v Dillon[241] of breach of a contractual term that the promisor will not cause the promisee disappointment of mind, but did not need to decide the point given the psychiatric injury.[242] In Goldman Sachs JBWere Services Pty Limited v Nikolich,[243] on appeal, the Full Court referred to but did not comment one way or the other on this observation by Wilcox J.
[240] [2006] FCA 784.
[241] (1993) 176 CLR 344.
[242] [2006] FCA 784 at [315]-[318].
[243] [2007] FCAFC 120; (2007) 163 FCR 62.
Application
Ms Ramsey does not claim that she suffered a psychiatric or physical injury or physical (as opposed to mental) distress due to Annesley’s wrongful termination. The Contract was not a contract for the purpose of pleasure in the sense identified by the High Court in Baltic Shipping Co v Dillon.[244]In these circumstances, damages for distress does not constitute a recoverable head of loss.
M. CONCLUSION
[244] (1993) 176 CLR 144.
Ms Ramsey fails in her case that the parties in 2009 entered into a contract for three or five years. However, the parties did enter into a contract in early 2010 in the same terms as the 2005 Contact except that it was not for a fixed term. That Contract was terminable by either party on 12 weeks’ notice.
Annesley relies upon alleged breaches of the mutual trust and confidence term by Ms Ramsey as justifying its summary termination of the Contract. Annesley failed to establish the alleged breaches by Ms Ramsey of the implied mutual trust and confidence term as justifying its purported summary termination of the Contract. Ms Ramsey was not in breach and Annesley was not entitled to terminate summarily the Contract.
Ms Ramsey is entitled to recover by way of debt the sum of $47,081.95 being her contractual entitlement to 12 weeks’ salary in lieu of notice and statutory long service leave entitlement. Alternatively, she is entitled to damages for Annesley’s fundamental breach of contract and repudiation in purportedly terminating the Contract summarily. I assess the amount of those damages at $47,081.95.
In principle, if Ms Ramsey had established that, but for Annesley’s breach, she would have had a prospect of continuing in her employment with Annesley, she would have been entitled to damages representing the value of that lost opportunity. However, Ms Douglas would have terminated Ms Ramsey’s employment legitimately by paying her 12 weeks’ salary if she had not purported to terminate summarily her employment. Accordingly, Ms Ramsey did not lose a valuable opportunity to continue in employment at Annesley by reason of Annesley’s breach of contract.
In principle, Ms Ramsey is not entitled to recover damages for loss of the opportunity to gain executive level teaching employment elsewhere due to the circumstances surrounding her dismissal. In any event, she failed to prove that she suffered a loss of a valuable opportunity due to those circumstances.
Ms Ramsey fails in her case that Annesley breached the mutual trust and confidence term in its conduct of the investigation between November 2009 and March 2010 leading up to the purported summary termination. She fails in her case that there was a complaints policy term.
Ms Ramsey fails in her case that Annesley acted for an ulterior financial motive in deciding to terminate summarily the Contract.
I will hear the parties as to other relief including interest and as to costs.
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