Stevens, R. v Cole, S
[1994] FCA 411
•29 JUNE 1994
ROBIN STEVENS v. STUART COLE, GLEN WADROP and DAVID CRIDLAND comprising the
Disciplinary Appeal Board established pursuant to the Australian National
Railways Commission Act 1983
No. SG19 of 1994
FED No. 411/94
Number of pages - 12
Administrative Law
(1994) 51 FCR 487
COURT
IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIAN DISTRICT REGISTRY
GENERAL DIVISION
BRANSON J
CATCHWORDS
Administrative Law - Judicial Review - termination of employment due to misconduct - whether excessive punishment imposed on an employee - relevance of the principles of criminal law sentencing - employer/employee relationship, duty of good faith owed to employer.
Administrative Decisions (Judicial Review) Act 1977 s5
Australian National Railways Commission Act 1983 ss37, 38, and 42
Railway Services Rules rr159, 160(2)
HEARING
ADELAIDE, 30 May 1994
#DATE 29:6:1994
Counsel for the Applicant : Mr A Collett
Solicitors for the Applicant : Johnston Withers
Counsel for the Respondents : Mr T Owen
Solicitors for the Respondents: Low and Partners
ORDER
THE COURT ORDERS THAT:
The application be dismissed.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
JUDGE1
BRANSON J The application seeks a review of a decision of the Disciplinary Appeal Board established pursuant to the Australian National Railways Commission Act 1983 ("The ANRC Act") made on 17 February 1994. On that day by majority decision the Disciplinary Appeal Board dismissed an appeal by the applicant, Mr Robin Stevens, against his termination of employment. Mr Stevens was dismissed by the Australian National Railways Commission ("the Commission") from duty as from the close of business on Friday 19 November 1993 following an inquiry conducted by a Disciplinary Board of Inquiry constituted pursuant to Division 4 of Part IX of the Railway Service Rules. Mr Stevens appealed to the Disciplinary Appeal Board on both of the available grounds; namely:-
(a) that he should not have been found guilty of misconduct; and
(b) that an excessive punishment had been imposed.
(see ANRC Act s42 and the Australian National Railways Commission Board of Appeal By-law ("the Appeal By-law") clauses 25 and 26).
This application, which as argued relates only to penalty, is brought pursuant to s5 of the Administrative Decisions (Judicial Review) Act 1977, on the grounds that:-
"(a) the decision involved an error of law;
(b) the decision was otherwise contrary to law;
(c) the decision maker failed to take relevant considerations into account;
(d) the exercise of the power is so unreasonable that no reasonable person could have so exercised the power; and
(e) that the power was exercised in a way that constitutes abuse of the power."
The factual background to this application is as follows.
Mr Stevens commenced employment with the Commission in 1966. He is a welder by trade and immediately before commencing long service leave in June 1993 he was the acting leading hand in the Blacksmith's Shop. Mr Stevens' wife suffers from a chronic illness and as a consequence he is under personal and financial pressures. The purpose behind his taking long service leave was apparently to assist him in providing care to his wife. Mr Stevens has sought to be declared redundant by his employer so as to be in a better position to care for his wife but no determination of redundancy has been made by the Commission. Except for the events which led to the termination of Mr Stevens' employment, he has had an unblemished record of employment with the Commission.The finding of misconduct made against Mr Stevens are that:-
"(a) On Tuesday 21 September 1993 at his residence at Carslake Road, Dublin he arranged and took delivery of a reel containing approximately ten metres of electrical flex valued at approximately $2.00 per metre knowing it was the property of Australian National, and
(b) During a date in May or June 1993 at his residence at Carslake Road, Dublin he arranged and took delivery of a quantity of wooden sleepers knowing they were the property of Australian National."
It was accepted during argument before me that had Mr Stevens sought to purchase the wooden sleepers referred to in sub-paragraph (b) above from the Commission he could have done so for a cost of approximately $10.00.
Mr Stevens has at all times denied the delivery to him of the electrical flex and the sleepers. He was disbelieved both by the Disciplinary Board of Inquiry and by the Disciplinary Appeal Board. The Disciplinary Appeal Board described the explanation offered by him in evidence before it as "fanciful". It was conceded by Mr Collett, counsel for Mr Stevens, that for the purposes of this review the findings of misconduct made against Mr Stevens must be accepted.
The first error identified by Mr Collett as having been made by the Disciplinary Appeal Board was that it made no findings as to the nature of Mr Stevens' misconduct relating to the sleepers and flex. Section 42(5) of the ANRC Act requires a Disciplinary Appeal Board to give reasons, in writing, for its decision on the appeal. Moreover, clause 31(2) of the Appeal By-law provides as follows:-
"The decision of a Disciplinary Appeal Board shall be given in writing in accordance with Form No. ANR22, shall be signed by the members of the majority and shall have the reasons for the decision included therein or annexed thereto."
Mr Collett drew attention to s25D of the Acts Interpretation Act 1901 which is in the following terms:-
"Where an Act requires a tribunal, body or person making a decision to give written reasons for the decision... the instrument giving the reasons shall also set out the findings or material questions of fact and refer to the evidence or other material on which those findings were based."
I note that no request has been made to the Disciplinary Appeal Board pursuant to s13(1) of the Administrative Decisions (Judicial Review) Act 1977 requesting that -
"a statement in writing setting out the findings on material questions of fact, referring to the evidence or other material on which those findings were based and giving the reasons for the decision."
nor was the court requested to refer the matter to which the decision of the Disciplinary Appeal Board relates to the Board for further consideration by the Board. (Administrative Decision (Judicial Review) Act 1977 s16(1)(b)).
Mr Collett submitted that for the purposes of considering the question of penalty the Disciplinary Appeal Board was required to determine whether Mr Stevens took delivery of the sleepers and flex:-
(i) never having intended to pay for them;
(ii) without intending at that time to pay for them, albeit that at an earlier time he had intended to pay for them; or
(iii) having at all times intended to pay for them - although without in fact having done so.
The Disciplinary Appeal Board had before it evidence tendered by consent in a written statement made by one Peter Greatbatch. Mr Greatbatch stated that in about June 1993 Mr Stevens had asked him to leave some 10-15 sleepers at a particular location for the purpose of Mr Stevens making arrangements to purchase the sleepers. He said that he did drop off sleepers at that location but Mr Stevens did not pursue the transaction. Mr Stevens gave evidence that he did make such an arrangement with Mr Greatbatch, but that he did not have time to complete the transaction before going on long service leave.
The Disciplinary Appeal Board further accepted the evidence of one Gary Owens who said that at some time in about June 1993 at the request of Mr Stevens he delivered sleepers to Mr Stevens' property. He said that he took the sleepers from the position described by Mr Greatbatch. He further said that on 21 September 1993, again at the request of Mr Stevens, he delivered a reel containing a relatively small amount of orange coloured electrical cable to Mr Stevens' property. A neighbouring property owner to Mr Stevens and his son gave evidence, which was accepted by the Disciplinary Appeal Board, that they had seen a Railway truck at Mr Stevens property on 21 September 1993 and that on its arrival they could see an orange coloured drum in the tray of the truck but that no such drum was visible when the truck left the property. The son noted the registration number of the truck and there was no dispute that the registration number was that of the Railways truck normally allocated to Mr Gary Owens.
Mr Stevens gave evidence before the Disciplinary Appeal Board that he knew nothing of the delivery to his property of either the sleepers or the electrical flex. He asserted that Mr Owens and his neighbours had set him up. As mentioned above the Disciplinary Appeal Board found the explanation offered by Mr Stevens as "so fanciful and so uncompelling that it cannot be accepted".
In the circumstances the Disciplinary Appeal Board had no direct evidence placed before it as to Mr Stevens' intentions at any relevant time with respect to the making of payments for the sleepers and flex.
The Disciplinary Appeal Board was obliged to determine whether on the whole of the evidence it was satisfied that Mr Stevens was guilty of the misconduct with which he was charged. This involved determinations, amongst other things, of whether Mr Stevens arranged and took delivery of the sleepers and the flex respectively knowing them to be the property of the Commission. The Disciplinary Appeal Board made such determinations adversely to Mr Stevens.
Having made such determination it seems to me that the Disciplinary Appeal Board was in a similar position to the learned sentencing judge whose sentence was the subject of appeal in The Queen v Calabria (1982) 31 SASR 423. In that case King CJ said at page 437:-
"The appellant was proved to have been a participant in an operation of drying out Indian Hemp plants in contemplation of sale. He was found, therefore, to have been concerned, at least indirectly, in the buying or selling of Indian Hemp and therefore to be guilty of trading within the meaning of the Act. It was for this participation that he had to be punished. The degree of his participation is not known... Speculation is futile. If the appellant had put forward an explanation of his role in the operation, his Honour would have heard his evidence and have been able to judge its veracity. If he were left in doubt, he would have been required to resolve the doubt in favour of the appellant. In the absence of evidence, however, any assumption as to the degree of the appellant's participation would be unjustified speculation. He was proved to be a participant in the operation and therefore to be guilty of trading in Indian Hemp and he must be punished for that. If the degree of participation were known, it might operate in aggravation or extenuation of the degree of his guilt. As it is not known, it can operate neither as aggravation nor extenuation."
In the same case at pages 452-453 White J said of the appellant who had at trial denied the conduct of which he was found guilty:-
"There was an onus upon the appellant to dispel any mystery created by his former lies and silences and to satisfy the sentencing Judge about the limits of his role in a situation like this...
If a prisoner like the appellant fails or refuses to assist the court charged with the obligation of fixing a fair sentence in the task of defining the parameters of his offending, the court is relieved of the obligation to take the most favourable view of the facts open on the evidence, when it is clear that the offender was actually involved in serious criminal conduct... The Court is not required to guess favourably about a hypothetically minimal role which can be attributed artificially to the silent prisoner. If he asks for leniency after having lied, he should speak out and this time speak out convincingly."
In my view it was appropriate for the Disciplinary Appeal Board to consider the issue of punishment having regard to the findings of misconduct made by them. The Board could not assume theoretically available mitigating factors which would fly in the face of common sense, such as the possibility that Mr Stevens has at all times intended to pay for the property of which he took delivery (see The Queen v Stevenson (1984) 52 SASR 237 per White J at p243). Nor could the Board assume matters of aggravation which were not established on the evidence. I do not consider that anything in s42(5) of the ANRC Act, clause 31(2) of the Appeal By-laws or s25D of the Acts Interpretation Act suggest otherwise.
In short, I do not accept the submission of Mr Collett that the Disciplinary Appeal Board was obliged in the circumstances to make the determination which he identified.
Secondly, Mr Collett argued that the Disciplinary Appeal Board erred in that having determined that Mr Stevens had lied, it wrongly took that into account against him, effectively regarding it as the most significant factor in determining penalty.
After listing (accurately as Mr Collett conceded) the matters put to them in mitigation of penalty, the majority of the Disciplinary Appeal Board said:-
"We take those matters into account. However we cannot overlook that the two occasions of arranging and receiving the goods were calculated rather than spur of the moment activities by someone who held a position of responsibility within AN and who in many respects abused that position and his knowledge of AN procedures. The appellant has denied any wrong- doing from the time that he was first confronted with the allegations. Our finding that the appellant is guilty of misconduct as alleged necessarily means that he has lied and persisted in lies in relation to the two incidents. In our view there is little room for leniency and in the circumstances the termination of employment should remain."
In my view, it is plain that the majority of the Board took into account with respect to penalty the fact of Mr Stevens' lies. I do not accept, however, that they regarded such lies as the most significant factor in determining penalty. It seems to me that the lies were taken into consideration along with the repeated nature of the misconduct, its calculated rather than spontaneous nature and the abuse of his position of responsibility and his knowledge of the Commission's procedures. There is nothing in the reasons of the Board to indicate that any one of the above factors was given a weighting appreciably different from any other.
Mr Collett suggests that what was in reality done by the Disciplinary Appeal Board was to increase the punishment which might otherwise have had imposed on Mr Stevens by reason of his having defended the charges of misconduct laid against him. He referred to the decisions of The Queen v Shannon (1979) 21 SASR 442 and The Queen v Harper (1968) 2 QB 108.
When the remarks of the majority of the Board with respect to lies are placed in context, it seems to me that, even if they were to be judged by the standards appropriate for the imposition of a criminal sentence, they would escape legitimate criticism. The majority of the Board, as I read their reasons, have not determined that Mr Stevens should be punished for lying, but rather that his lies, along with other factors, militate against leniency in his punishment.
However, in my view, the process of determining punishment pursuant to the disciplinary provisions of the Railway Service Rules is not properly to be equated with the sentencing processes of the criminal law.
The powers of the Commission with respect to its employees are specifically dealt with in ss37 and 38 of the ANRC Act. Section 38(1) provides for the terms and conditions of service or employment of employees of the Commission to be determined by the Commission in writing. Section 38(2) is in the following terms:-
"(2) the terms and conditions of service and employment that may be determined under subsection (1) include terms and conditions specifying:
(a) the grounds on which employees, or employees included in a class of employees, may be charged with misconduct;
(b) the manner in which charges of misconduct may be dealt with; and
(c) the kinds of action that may be taken in relation to employees against whom charges of misconduct are established."
The Commission has by instrument in writing determined terms and conditions of service and employment. The determination is set out in the Railway Service Rules ("the Rules").
Part IX of the Rules deals with the discipline of employees. Rule 159, which is the first rule within Part IX, provides that in the Rules a reference to misconduct in relation to an employee is a reference to a failure of the employee to fulfil his duty as an employee. This provision emphasises the concern of Part IX of the Rules with the employee/employer relationship between the employee and the Commission. The Rules neither seek to supplant the criminal law so far as employees are concerned (see Rule 160(2)) nor to incorporate into the employer/employee relationship the principles of criminal law sentencing.
At common law an employee may be summarily dismissed for conduct inconsistent with the fulfilment of his or her express or implied conditions of service (North v Television Corporation Ltd (1976) 11 ALR 599 at p609). An isolated act of dishonesty amounting to a breach of confidence and good faith towards the employer may be sufficiently serious to justify summary dismissal (Sinclair v Neighbour (1967) 2 QB 279); Osborne v Woolworths (SA) Ltd (1992) 59 SASR 600). In my view Rule 162 of the Railway Service Rules, which gives the Commission the power to terminate the employment of an employee for misconduct, is to be understood in the light of the common law as referred to above, rather than by reference to the principles of criminal sentencing.
Of course, there will be occasions in which the approach appropriate to be taken by the Commission in considering penalty will be similar to that which a criminal court would take in sentencing. This does not mean, however, that where conduct is both improper conduct in an employee and criminal behaviour, the penalty which an employer may legitimately impose is necessarily to be assessed against the appropriate criminal sentence. I do not understand von Doussa J to have suggested otherwise in Cornish v Australian National Railways Commission (unreported decision of 22 December 1993 at p17).
Thirdly, Mr Collett argued that the Disciplinary Appeal Board failed to take into account the penalty imposed upon Mr Owens. Mr Owens was charged with, and admitted misconduct, namely using a Commission vehicle for a purpose other than Railway business, and removing goods from the premises of the Commission without complying with directions issued by the Commission for the removal of goods.
The penalty imposed upon Mr Owens following a Disciplinary Appeal was suspension from duty without pay for 10 weeks. Although the charges against Mr Owens arose out of conduct directly connected with the conduct which formed the base of the charges of misconduct against Mr Stevens (i.e. it was Mr Owens who delivered the sleepers and flex to Mr Stevens' property) the misconduct with which Mr Owens was charged was plainly less severe than that of which Mr Stevens was found guilty. Moreover the conduct with which Mr Stevens was charged was of a character which the Disciplinary Appeal Board was entitled to regard as dishonesty amounting to a breach of confidence and good faith towards his employer. The refusal of Mr Stevens to acknowledge his culpability could fairly be considered by the Disciplinary Appeal Board as confirming such breach of confidence and good faith. It seems to me that the Board did so consider it. It is not plain that the conduct with which Mr Owens was charged could fairly have been characterized as of the same serious nature.
In my view the disparity in the punishment imposed upon the two employees in the circumstances is not such as to reveal any error of principle in the confirmation by the Disciplinary Appeal Board of the punishment of dismissal imposed upon Mr Stevens by the Commission.
Finally, Mr Collett submitted that the Disciplinary Appeal Board adopted a sentencing approach which was contrary to law. He identified four separate bases for this submission. First he argued that the Board failed to have regard to the approach to sentencing established by the courts, namely to make the punishment fit the crime and lean towards mercy.
In Cornish v Australian National Railways Commission (supra) von Doussa J stated:-
"In cases of misconduct, it will usually be appropriate for the relevant decision-maker to arrive at a penalty which fairly balances the seriousness of the misconduct, and the need for the penalty to act as a deterrent to the particular employee as well as a deterrent by way of example to others from departing from the standards of conduct required of employees in the Railway Service, against the hardship and other impacts which the penalty will have on the particular employee. But there may be exceptional cases where the nature and seriousness of the conduct of the employee indicates such a risk to safety in the future that the protection of others must take priority over the personal circumstances of the employee concerned. By analogy, it is a recognised principle of sentencing offenders in the criminal courts that in an appropriate case the protection of the public from further transgressions by the offender is a factor that may require a long custodial sentence notwithstanding the personal hardship which the offender will suffer."
As mentioned above I do not understand the above passage to imply that an employee found guilty of misconduct pursuant to Part IX of the Railway Service Rules is necessarily to receive a punishment determined in accordance with the approach which would be adopted by a criminal court. Punishment pursuant to the Railway Service Rules is an incident of the employer/employee relationship between the Commission and its employees. The broader public interests served by the criminal courts, while not irrelevant to punishment under the Railway Service Rules, are not at the heart of the employer/employee relationship.
The reasons of the majority of the Disciplinary Appeal Board show that they recognised the seriousness of the penalty of dismissal and the consequence of such a dismissal to Mr Stevens' application for a redundancy package. They took into account the submissions made by counsel for Mr Stevens which tended in Mr Stevens favour. They further considered, as I understand their reasons for decision, the issue of Mr Stevens' breach of confidence and good faith towards his employer as demonstrated by his repeated conduct of arranging and receiving goods the property of his employer and his failure to acknowledge or show remorse for such conduct. It is not material to consider whether I would have considered dismissal the most appropriate penalty in all of the circumstances. In my view the majority of the Board has not been shown to have erred in confirming the penalty of dismissal.
The three remaining bases for Mr Collett's submission that the Disciplinary Appeal Board adopted a sentencing approach which was contrary to law are as follows:-
"(ii) the Board erred in law in endorsing ANRC policy relating to larceny of Railway property without sufficient regard to the merits of the case;
(iii) the Board failed to have regard to the full range of penalty prescribed by the Railway Service Rule;
(iv) given the range of penalties available the Board adopted a penalty that was
- severe
- manifestly excessive
- disproportionate to the circumstances that (sic) the court can interfere on judicial review in these circumstances."
It may be noted that the majority of the Disciplinary Appeal Board did not refer to any Commission policy relating to larceny of Railway property in their reasons for decision. However, an internal memo from the General Manager, Rail Transport to the Managing Director of the Commission dated 16 November 1993 states the following:-
"Although Mr Stevens employment history is satisfactory, in view of the committed (sic) policy on theft of AN property it is recommended that he be dismissed as from the close of business on Friday, 19 November 1993."
It was on the basis of this recommendation that the Commission dismissed Mr Stevens.
Although I am not persuaded that it would have been wrong for the Disciplinary Appeal Board, for the purpose of determining punishment, to have taken into account along with other relevant matters, a Commission policy known to Commission employees, the reasons of the majority of the Board do not suggest that they did take such policy into account.
Nor, in my view, can it fairly be said that the Board failed to have regard to the full range of penalties prescribed by the Railway Service Rules. Plainly the submissions placed before the Board by Mr Stevens' counsel were to the effect that one or more of the lesser penalties was appropriate in the circumstances of the case. The Board took such submissions into account.
For the reasons already given I do not accept the submission that the penalty adopted by the majority of the Board was so severe, manifestly excessive and/or disproportionate to the circumstances as to demonstrate an error of law by the majority of the Board.
The application will be dismissed.
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