Smith v Kelsey; Dalley v Kelsey

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SUPREME COURT OF QUEENSLAND

CITATION:

Smith v Kelsey & Ors; Dalley & Ors v Kelsey & Ors [2020] QCA 55

PARTIES:

In Appeal No 7689 of 2019:

TIMOTHY LUKE SMITH
(appellant)
v
SHARON RAE MARIE KELSEY
(first respondent)
LOGAN CITY COUNCIL
(second respondent)
CHERIE MARIE DALLEY
(third respondent)
RUSSELL BRUCE LUTTON
(fourth respondent)
STEPHEN FREDERICK SWENSON
(fifth respondent)
LAURENCE WILLIAM SMITH
(sixth respondent)
PHILIP WAYNE PIDGEON
(seventh respondent)
TREVINA DALE SCHWARZ
(eighth respondent)
JENNIFER RACHEL JULIE BREENE
(ninth respondent)

In Appeal No 7699 of 2019:

CHERIE MARIE DALLEY
(first appellant)
RUSSELL BRUCE LUTTON
(second appellant)
STEPHEN FREDERICK SWENSON
(third appellant)
LAURENCE WILLIAM SMITH
(fourth appellant)
PHILIP WAYNE PIDGEON
(fifth appellant)
TREVINA DALE SCHWARZ
(sixth appellant)
JENNIFER RACHEL JULIE BREENE
(seventh appellant)
v
SHARON RAE MARIE KELSEY
(first respondent)
LOGAN CITY COUNCIL
(second respondent)
TIMOTHY LUKE SMITH
(third respondent)

FILE NO/S:

Appeal No 7689 of 2019
Appeal No 7699 of 2019
ICQ No C/2019/14
ICQ No C/2019/15

DIVISION:

Court of Appeal

PROCEEDING:

General Civil Appeal

ORIGINATING COURT:


Industrial Court at Brisbane – [2019] ICQ 8 (Martin J)

DELIVERED ON:

27 March 2020

DELIVERED AT:

Brisbane

HEARING DATE:

31 October 2019

JUDGES:

Morrison and Philippides JJA and Brown J

ORDERS:

In Appeal No 7689 of 2019:

1.   Appeal dismissed.

2.   The appellant pay the first respondent’s costs of the appeal.

In Appeal No 7699 of 2019:

1.   Appeal dismissed.

2.   The appellants pay the first respondent’s costs of the appeal.

CATCHWORDS:

APPEAL AND NEW TRIAL – APPEAL – GENERAL PRINCIPLES – INTERFERENCE WITH DISCRETION OF COURT BELOW – IN GENERAL – OTHER MATTERS – PROCEDURE – QUEENSLAND – STAY OF PROCEEDINGS – WHEN REFUSED – where the CEO of Logan City Council made a public interest disclosure (PID) to the Logan City Council, the Minister for Local Government, and the Crime and Corruption Commission (CCC) alleging possible misconduct by the then Mayor of Logan City – where the Councillors were given legal advice that they could not take the PID into account when considering the CEO’s employment – where the Councillors received legal advice that it would be unlawful to terminate the CEO’s employment due to the PID – where the CEO’s employment was terminated after a vote by the Councillors – where Councillors Dalley, Lutton, Swenson, Smith, Pidgeon, Schwarz and Breene all voted in favour of termination of the CEO – where the CEO commenced IRC proceedings with the Mayor and the above named Councillors named as respondents – where the Mayor and the above named Councillors were all charged with fraud on the basis that they caused detriment to the CEO – where the Mayor and the above named Councillors applied to the Industrial Relations Commission for a stay of the IRC proceedings on the basis that the IRC proceeding would require the Commission to determine the same factual matters that would need to be determined by the jury in the criminal trial – where it was contended that the likely publicity associated with that determination would prejudice the fair…

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Details
Case
[2020] QCA 55
Decision Date

CaseChat Overview and Summary

In the case of Smith v Kelsey; Dalley v Kelsey, the respondents, Smith, Dalley, Lutton, Swenson, Pidgeon, Schwarz and Breene, who are councillors of Logan City Council, along with the Mayor of Logan City, Smith, sought an appeal against the Industrial Court's decision to dismiss their appeal against the Industrial Relations Commission's refusal to stay the Industrial Relations Commission (IRC) proceedings. The respondents sought the stay on the basis that the IRC proceeding would require the Commission to determine the same factual matters that would need to be determined by the jury in the criminal trial, and that the likely publicity associated with that determination would prejudice the fair trial of the criminal charges. The respondents argued that the Industrial Court erred in not granting the stay and that it was wrong to conclude that there is a substantial difference between the IRC proceedings and the criminal proceedings.

The legal issues that the court was required to decide were whether the appellants were required to demonstrate an error of the type described in House v The King and whether the Industrial Court erred in not granting the stay. The court was also required to determine whether it was right to conclude that there is a substantial difference between the IRC proceedings and the criminal proceedings and whether the Industrial Court erred in the determination matter below. The court found that there was no relevant error on the part of the Vice-President of the IRC, in summary because there was no principle laid down in ASIC v HLP, and it was distinguishable in any event. The court held that there was a substantial difference between the IRC proceedings and the criminal proceedings, and even though there was an overlap of evidence, the questions were not the same. The court also held that specific identification of the public interest in having the criminal justice system operate without undue interference was not a mandatory consideration leading to House v The King error.

The court held that the respondents failed to demonstrate an error of the type described in House v The King. The court found that the grounds relating to miscarriage of the discretion, including the competing claims to prejudice, failed because the questions in the two sets of proceedings were different, the criminal proceedings would not come to trial for 18 months to two years which would unfairly delay the outcome in the IRC, and the impact on the jury of any publicity could be ameliorated by appropriate directions. The court held that the remaining grounds added no more substance to the appeal. The appeals were dismissed, and the appellants were ordered to pay the first respondent’s costs of the appeal.

Orders

Orders of the court

In Appeal No 7689 of 2019:

1. Appeal dismissed.

2. The appellant pay the first respondent’s costs of the appeal.

In Appeal No 7699 of 2019:

1. Appeal dismissed.

2. The appellants pay the first respondent’s costs of the appeal.

Background

Background to the litigation

Oral submissions in the IRC proceedings have been adjourned until determination of the stay application and appeal.Additional factual background Ms Kelsey’s PID notified the CCC of certain conduct of the Mayor (Mr Smith), which she suspected of being corrupt conduct. The CCC’s investigation into the Mayor was in relation to the termination of Ms Kelsey’s employment, including allegations that the Mayor directed or otherwise influenced the seven Councillors to vote in favour of termination, as retaliation for Ms Kelsey’s notification of suspected corrupt conduct. One of the issues in the IRC proceedings concerns the question of direction or influence by the Mayor in relation to the Councillors who voted for termination. As the CCC put it, an issue is “whether there is an alignment resulting in a voting ‘bloc’ of seven (7) councillors who vote with the Mayor without exercising independent thought”.[11] The CCC also noted that a number of the Councillors who were parties to the IRC proceedings had sworn affidavits denying that they were aligned or affiliated with the Mayor, or that they exercised their votes in accordance with how the Mayor and other Councillors voted.[11]AB 360. In the IRC proceedings the Councillors who had voted for termination had put forward their reasons for doing so in written submissions documenting each Councillor’s concerns.[12] Further, the Councillors had all provided affidavits in which they said what motivated them to vote for termination. The Councillors submitted that they did not exercise their voting rights based upon Ms Kelsey’s exercise of a workplace right. As was noted in the appeal from the decision to reinstate Ms Kelsey,[13] the reasons were set out in detail in the affidavits and if they were to constitute the only evidence at the final hearing, “then it is likely that the Council would discharge its onus under the IR Act”. Of course, it was noted that those affidavits do not constitute the only evidence.[12]Kelsey v Logan City Council & Ors [2018] QIRC 053 at [50]-[51], AB 890-893.[13]Dalley & Ors v Kelsey & Ors [2018] ICQ 006 at [50], AB 946. The Councillors’ contentions in the IRC proceedings were that all had valid reasons for making their decision based on Ms Kelsey’s performance, and that decision was made notwithstanding advice from the CCC and legal advice that it would be unlawful for the decision to be made if it was based on the exercise of a workplace right.[14][14]Kelsey v Logan City Council & Ors [2018] QIRC 053 at [59], AB 894. Nonetheless, it has been plain since the CCC warned that it might investigate the circumstances of Ms Kelsey’s termination, that the IRC proceedings would be conducted knowing the CCC were investigating and that CCC prosecution was a possibility. No doubt it is for that reason that no submissions were made before this Court that there were particular forensic decisions made about steps in the IRC proceedings, including what evidence to put on, that would prejudice the Councillors’ position in the criminal proceedings.Nature of the appeal

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

An appeal to this Court pursuant to s 554 of the IR Act lies only on the grounds of error of law or excess or want of jurisdiction.The decision below Martin J distilled the many grounds of appeal from the decision of the IRC into the following propositions of error:[16][16]Reasons below at [17].(a)failed to apply the principle propounded in ASIC v HLP Financial Planning (Aust) Pty Ltd;[17][17](2007) 164 FCR 487.(b)failed to take into account the prejudice which would or might be caused by the IRC determining the same factual questions that a jury would have to consider in a criminal trial;(c)conflated two different issues: the effect of pre-trial publicity and the determination of “precisely the same factual matter that will need to be determined by the jury”;(d)failed to take into account public interest in maintaining the integrity of the criminal justice system;(e)did not find that the prejudice to the appellants outweighed that which would be suffered by Ms Kelsey;(f)failed to accept that it would be unfair for the appellants to be forced to make a decision as to whether they would make submissions in the proceeding without knowing how the prosecution in the criminal trial will put its case;[18] (g)failed to take into account: (i)that there might be an appeal from the IRC proceedings;(ii)the evidence which Ms Kelsey would give at a criminal trial;(iii)the potential prejudice to the appellants in combination with the gravity of the potential sentences; and(h)finding that compensation was not an adequate remedy for Ms Kelsey.[18]This ground was not pressed on the appeal to this Court. Martin J held that there was no relevant error on the part of the Vice-President of the IRC, in summary because:(a)there was no principle laid down in ASIC v HLP, and it was distinguishable in any event;[19](b)there was a substantial difference between the IRC proceedings and the criminal proceedings; in the IRC proceedings the appellants had to prove that the action they took was not for the reasons in s 285 of the IR Act, whereas the criminal proceedings required the prosecution to prove beyond reasonable doubt that the appellants acted dishonestly in taking their actions; even though there was an overlap of evidence, the questions were not the same; the question of prejudice flowing from the outcome in the IRC proceedings was adverted to;[20](c)specific identification of the public interest in having the criminal justice system operate without undue interference was not a mandatory consideration leading to House v The King error; reliance for that proposition depended upon comments by Kirby J in Yuill v Spedley Securities Ltd and Others[21] about the guidelines referred to in McMahon v Gould[22] but those comments were not adopted by the majority in Yuill;[23](d)the grounds relating to miscarriage of the discretion, including the competing claims to prejudice, failed because the questions in the two sets of proceedings were different, the criminal proceedings would not come to trial for 18 months to two years which would unfairly delay the outcome in the IRC, and the impact on the jury of any publicity could be ameliorated by appropriate directions;[24] and(e)remaining grounds added no more substance to the appeal.[19]Reasons below at [23]-[28].[20]Reasons below at [30]-[36].[21](1992) 8 ACSR 272 at 274.[22](1982) 7 ACLR 202.[23]Reasons below at [38]-[41].[24]Reasons below at [50]-[64].

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.