State of South Australia (in Right of Department for Education and Child Development) v Dolan

[2019] SASC 168

SUPREME COURT OF SOUTH AUSTRALIA

(Applications Under Various Acts or Rules)

STATE OF SOUTH AUSTRALIA (IN RIGHT OF DEPARTMENT FOR EDUCATION AND CHILD DEVELOPMENT) v DOLAN

[2019] SASC 168

Judgment of The Honourable Justice Stanley

27 September 2019

WORKERS' COMPENSATION - ENTITLEMENT TO COMPENSATION - EMPLOYMENT RELATED INJURY, DISABILITY OR DISEASE

APPEAL AND NEW TRIAL - APPEAL - GENERAL PRINCIPLES - RIGHT OF APPEAL - WHEN APPEAL LIES - ERROR OF LAW

Application for permission to appeal to the Full Court.

The Full Bench dismissed an appeal from a single judicial member of South Australian Employment Tribunal who set aside a determination of the relevant compensating authority rejecting the respondent worker’s claim for compensation for psychiatric injury on the basis that the injury arose predominantly from reasonable action taken in a reasonable manner to counsel and discipline the worker pursuant to s 7(4)(a) of the Return to Work Act 2014 (SA) (the Act).

There are two grounds of appeal. First, that the primary judge’s reasons were inadequate in failing to explain the basis of the finding that the employer’s counselling and disciplinary actions were not reasonable actions taken in a reasonable manner, in circumstances where the judge found that the worker was guilty of misconduct which warranted counselling and disciplinary action, but because of the worker’s difficult personal circumstances, formal letters that made reference to the employer’s code of ethics, the potential for disciplinary action, and advising that an officer of the employer would be in attendance at a subsequent meeting, was not reasonable action taken in a reasonable manner. Second, that the judge erred by misapplying s 7(4) of the Act in being satisfied that the worker’s injury did not arise predominantly from designated actions. The primary judge failed to make the necessary factual findings that the employer’s actions found to be unreasonable were not the predominant causes of her psychiatric injury.

Held, granting permission to appeal:

1.  It is at least arguable that the primary judge’s reasons were inadequate in finding that the employer’s counselling and disciplinary actions were not reasonable actions taken in a reasonable manner.  

2. The question of whether the primary judge erred by misapplying s 7(4) of the Act in being satisfied that the worker’s injury did not arise predominantly from designated actions and failed to make the necessary factual findings that the employer’s actions found to be unreasonable were not the predominant causes of her psychiatric injury, raises an important question of approach in relation to the determination of claims for compensation for psychiatric injury where the issue is whether the disqualifying provisions of s 7(4) have been excluded. As this ground raises a question of general importance it is appropriate that permission be granted.

Return to Work Act 2014 (SA) s 7(4), referred to.
Wheeler v State of South Australia [2012] SASCFC 2111; Department of Education and Child Development v Dolan [2019] SAET 166, considered.

STATE OF SOUTH AUSTRALIA (IN RIGHT OF DEPARTMENT FOR EDUCATION AND CHILD DEVELOPMENT) v DOLAN
[2019] SASC 168

STANLEY J:

Introduction

1. This is an application for permission to appeal from a decision of the Full Bench of the South Australian Employment Tribunal (SAET). 

2. The Full Bench dismissed an appeal from a single judicial member of SAET who set aside a determination of the relevant compensating authority rejecting the respondent worker’s claim for compensation for psychiatric injury on the basis that the injury arose predominantly from reasonable action taken in a reasonable manner to counsel and discipline the worker pursuant to s 7(4)(a) of the Return to Work Act 2014 (SA) (the Act).

3. The grounds of appeal in respect of which permission is sought are twofold. First, that the primary judge’s reasons were inadequate in failing to explain the basis of the finding that the employer’s counselling and disciplinary actions were not reasonable actions taken in a reasonable manner, in circumstances where the judge found that the worker was guilty of misconduct which warranted counselling and disciplinary action, but because of the worker’s difficult personal circumstances, formal letters that made reference to the employer’s code of ethics, the potential for disciplinary action, and advising that an officer of the employer would be in attendance at a subsequent meeting, was not reasonable action taken in a reasonable manner. Second, that the primary judge erred by misapplying s 7(4) of the Act in being satisfied that the worker’s injury did not arise predominantly from designated actions. The applicant contends that the primary judge failed to make the necessary factual findings that the employer’s actions found to be unreasonable were not the predominant causes of her psychiatric injury.

4. I would grant permission to appeal.

5. In relation to the first ground, the failure to provide adequate reasons is a question of law.  The principal judgment of the Full Bench was delivered by DPJ Hannon with whom DPJ Farrell and DPM Ardlie agreed.  The Full Bench’s reasoning in rejecting the ground of appeal for inadequate reasons is as follows:[1]

   Reading the reasons of the Judge constructively and as a whole, it is plain that he took the view that, in dealing with the misconduct of Ms Dolan, the Department ought to have taken into account that she had been subjected to a variety of personal and work stressors over a lengthy period of time. It is clear that the Judge took the view that these stressors had a negative effect on Ms Dolan, and caused insecurity and a sense of lack of appreciation. In my view it can be readily inferred that the Judge thought a more nuanced and less formal approach ought to have been taken in the Department’s dealings with Ms Dolan at and following the meeting on 5 November 2015. It can be inferred that the Judge took the view that, despite Ms Dolan not having responded satisfactorily to the discussion on 5 November 2015, or to the directions given in the letter of 11 November 2015, the extent and nature of her ongoing misconduct and lack of response had not reached the stage by February 2016 where the formal procedures which were invoked were warranted or reasonable having regard to all of the circumstances. It can be inferred that he considered that the invocation of formal procedures and documentation at that time should have been understood by a reasonable employer to be unnecessary and to be potentially counter-productive.

   [1]    Department of Education and Child Development v Dolan [2019] SAET 166 at [70].

6. It is apparent from a consideration of this critical part of the Full Bench’s reasons that the Full Bench found that the primary judge’s reasons were adequate on the basis of inferences they were prepared to draw which necessarily were not the subject of express reasons by the primary judge.  It is at least arguable whether those inferences were drawn by the primary judge.  I also consider it at least arguable whether those inferences were open.  In those circumstances I consider it is at least arguable that the reasons were inadequate. 

7. In relation to the second ground in respect of which permission to appeal is sought, the applicant fairly acknowledges that this ground was not argued before the Full Bench. In these circumstances, ordinarily I would be reluctant to grant permission to appeal. However, I consider that the ground in respect of which permission is sought raises an important question of approach in relation to the determination of claims for compensation for psychiatric injury where the issue is whether the disqualifying provisions of s 7(4) have been excluded. The ground raises an issue of law which could not have been the subject of further evidence at trial.[2]  As this ground raises a question of general importance I consider it appropriate that permission be granted.

   [2]    Wheeler v State of South Australia [2012] SASCFC 111 at [48].