Swiegers v Commonwealth Scientific and Industrial Research Organisation

[2015] NSWDC 298

District Court

New South Wales

Medium Neutral Citation:	Swiegers v Commonwealth Scientific and Industrial Research Organisation [2015] NSWDC 298
Hearing dates:	Hearing: 13, 14, 15, 16, 20, 21, 22, 23, 27, 28, 29, 30 April 2015 and 30 June 2015
Decision date:	16 December 2015
Jurisdiction:	Civil
Before:	Justice Price, Chief Judge
Decision:	Verdict and judgment for the Commonwealth Scientific and Industrial Research Organisation, the defendant, against Gerhard Frederick Swiegers, the plaintiff
Catchwords:	CONTRACT – termination of employment contract – whether plaintiff’s claim barred by acceptance of early cessation payment – whether claim barred by reason of estoppel, waiver or election – secondment – whether defendant breached contract by failing to develop a role upon return from secondment – whether plaintiff liaised with defendant – consideration of defendant’s power of retrenchment – whether retrenchment was genuine – whether decision was made to retrench the plaintiff in November 2007 – whether plaintiff was not advised he was regarded as redundant for in excess of 12 months – treatment of other employees contrasted – whether closure of MDI project had anything to do with the Whistleblower Complaint – whether plaintiff likely to become excess to defendant’s staffing requirements – whether genuine effort made to redeploy plaintiff – whether plaintiff actually excess to defendant’s staffing requirements – whether plaintiff had future role at the CET Division
Legislation Cited:	Civil Procedure Act 2005 (NSW) s 56
Cases Cited:	Ashton v Pratt [2015] NSWCA 12; (2015) 88 NSWLR 281 Bank of Credit and Commerce International SA v Ali [2002] 1 AC 251 Banque des Marchands de Moscou (Koupetschesky) v Kindersley [1950] 2 All ER 549 Commonwealth v Verwayen [1990] HCA 39; (1990) 170 CLR 394 Goldman Sachs JBWere Services Pty Ltd v Nikolich [2007] FCAFC 120; (2007) 163 FCR 62 Grant v John Grant & Sons Pty Ltd [1954] HCA 23; (1954) 91 CLR 112 Karam v Australia & New Zealand Banking Group Ltd [2001] NSWSC 709 Legione v Hateley [1983] HCA 11; (1983) 152 CLR 406 McDermott v Black [1940] HCA 4; (1940) 63 CLR 161 Qantas Airways Ltd v Gubbins (1992) 28 NSWLR 26 Romero v Farstad Shipping (Indian Pacific) Pty Ltd [2014] FCAFC 177; (2014) 315 ALR 243 Technical and Further Education Commission t/as TAFE NSW v Pykett [2014] FWCFB 714; (2014) 240 IR 130 Thorby v Goldberg [1964] HCA 41; (1964) 112 CLR 597 Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; (2004) 219 CLR 165 Upper Hunter County District Council v Australian Chilling & Freezing Co Ltd [1968] HCA 8; (1968) 118 CLR 429 Waltons Stores (Interstate) Ltd v Maher [1988] HCA 7; (1988) 164 CLR 387 Wiltrading (WA) Pty Ltd v Lumley General Insurance Ltd [2005] WASCA 106; (2005) 30 WAR 290
Category:	Principal judgment
Parties:	Gerhard Frederick Swiegers (Plaintiff) Commonwealth Scientific and Industrial Research Organisation (Defendant)
Representation:	Counsel: M Gibian (Plaintiff) J Bourke QC and R Sweet (Defendant) Solicitors: Colquhoun Murphy Lawyers (Plaintiff) Norton Rose Fulbright (Defendant)
File Number(s):	2013/137442

Judgment

1. His Honour: The plaintiff, Dr Gerhard Frederick Swiegers, has brought proceedings alleging breach of contract arising from the termination of his employment with the defendant, the Commonwealth Scientific and Industrial Research Organisation (‘CSIRO’), Australia’s national science agency.

The Pleadings – a short summary

2. By a further Amended Statement of Claim (‘ASOC’), filed on 31 March 2015, the plaintiff claims that the defendant breached his employment contract or converted employment contract by:

1. Failing to develop a role for the plaintiff upon his return from secondment with DataDot Technology Australia Pty Ltd (‘DataDot’) in January 2009, contrary to the term of his contract of employment as varied by the letter dated 18 September 2006 (further ASOC 11 and 29A); and/or

2. That on about 23 February 2009, the defendant terminated the plaintiff’s employment, purportedly on grounds of redundancy in circumstances in which the plaintiff was not in fact excess to the staffing requirements of the defendant (further ASOC 28 and 29).

3. The plaintiff pleads, by virtue of the defendant’s breaches of the employment contract, that the plaintiff suffered and continues to suffer part loss of income, part loss of superannuation, future loss of income and future loss of superannuation. The plaintiff claims damages, interest and costs (further ASOC 34).

4. In a Fifth Further Amended Defence (‘Fifth FAD’), filed on 14 April 2015, the defendant denies that it was a term of the contract that upon the plaintiff’s return from secondment, the defendant would develop a role for him (Fifth FAD 11(a)). The defendant pleads that on its proper construction, the term alleged was too imprecise to be given contractual meaning. Rather, it was a non-binding indication as to what the defendant intended to do for its benefit, in the event that the plaintiff returned from secondment (Fifth FAD 11(A)).

5. The defendant claims it terminated the plaintiff’s employment because the plaintiff was excess to the defendant’s staffing requirements in accordance with the entitlement to terminate. The defendant pleads that this entitlement arose as a result of staffing changes in the National Security Technology Partnerships Theme (‘the Theme’) necessitated by a decreased funding allocation to the Theme and a realignment of the defendant’s research, capability and investment priorities away from security technology generally (Fifth FAD 28).

6. In addition to the retrenchment benefits offered to the plaintiff, by a letter dated 9 February 2009, the defendant offered a payment of an additional eight weeks’ pay (‘the early cessation payment’) if the plaintiff elected not to contest his redundancy and agreed to cease employment on or before 23 February 2009. The defendant claims that, as a result of the plaintiff’s acceptance of the early cessation payment, the plaintiff is estopped from challenging the lawfulness of the termination of his employment, or has otherwise waived any right to do so (Fifth FAD 36-38).

7. The defendant further and in the alternative pleads, by reason of the plaintiff’s failure to fulfil the condition (that for the duration of the secondment, the plaintiff would keep the defendant informed of additional skills he acquired on secondment: Fifth FAD 11(b)); the plaintiff’s failure to allege that the termination of his employment was contrary to the contract and any purported term arising from the 18 September 2006 letter (Fifth FAD 28(f)(ii)) and the matters in paragraphs 36 and 37, the plaintiff is estopped from alleging any purported failure by the defendant to comply with its obligations under the alleged employment contract, the converted employment contract and/or the letter from the defendant to the plaintiff dated 18 September 2006, or has otherwise waived any right he may otherwise have to do so (Fifth FAD 39).

8. In the event that it is found that the defendant has breached the contract, the defendant claims the plaintiff owed a duty to mitigate his damage (Fifth FAD 34(d)-(e)). The defendant pleads that the plaintiff has failed to mitigate his loss by failing to increase the level of his superannuation contributions so as to minimise, or eliminate, any adverse consequences that may result by the plaintiff ceasing to continue to be a contributing member to the defendant’s Commonwealth Public Sector Superannuation Scheme. Furthermore, the defendant claims that the plaintiff failed to invest the moneys he received from the defendant on the cessation of his employment into an appropriate superannuation fund (Fifth FAD 34vi.(A)(B)).

9. The onus of proof is on the plaintiff on the balance of probabilities. The plaintiff was represented by M Gibian and the defendant by J Bourke QC with R Sweet.

Some Findings of Fact

10. The plaintiff is a chemist, holds a PhD in Chemistry and a Bachelor of Science (Hons) in Chemistry. He commenced employment with the defendant on 2 March 1998 as a Research Scientist in the CSIRO Molecular Science Division at Clayton, Victoria (‘the CMHT’).

11. By a letter dated 16 December 1997, the plaintiff was employed for a term of three years at a CSIRO Salary Level 6. The letter recorded that:

“Your appointment to CSIRO is on the terms set out in the enclosed formal Document of Appointment.”

12. The Document of Appointment, which was enclosed, included the following terms:

“4.2 Your appointment may be terminated:

(a) by you giving notice to CSIRO of resignation;

(b) by CSIRO in the event of -

(i) misconduct;

(ii) incompetence;

(iii) your becoming excess to CSIRO’s staffing requirements;

(iv) invalidity.

…

Governing provisions

11. Your appointment will be subject to and governed by:

(a) the terms and conditions contained in this Document of Appointment;

(b) the CSIRO Terms and Conditions of Service, as varied from time to time, which may be inspected at your place of employment; and

(c) relevant present or future legislation, and awards of the Australian Industrial Relations Commission that are binding on CSIRO.”

13. The plaintiff had been assured by Dr Albert Mau, the then acting Chief of the CMHT, that appointments at the plaintiff’s level were initially term appointments that were subsequently converted to indefinite tenure. Dr Mau informed the plaintiff that the position would be converted to indefinite tenure within one year.

14. On 21 December 1998, the plaintiff and the defendant agreed to vary the employment contract so that the plaintiff’s employment would continue indefinitely. In a letter dated 21 December 1998, Dr Mau wrote:

“I am pleased to advise that I have endorsed the recommendation of the Divisional Management Committee and would like to offer you conversion to indefinite status.”

15. In 2001, the plaintiff became the leader of the security devices research group at the CSIRO. His work involved creating chemical materials with novel luminescent properties for use in anti-counterfeiting, track and trace techniques for banknotes, identity documentation, and products security applications. This included what became known as the “DataTrace” and “Modulated Digital Images” (‘MDI’) technology.

16. In October 2005, the defendant and DataDot established a joint venture company known as DataTrace DNA Pty Ltd (‘DataTrace’) to develop and commercialise the DataTrace technology. This arrangement was formalised by “the Research and Development Agreement” between the CSIRO and DataTrace.

17. From 24 July 2006, the plaintiff joined DataDot on secondment from the defendant, as vice-president of strategic research, working within DataTrace. Two documents formalised the plaintiff’s secondment with DataDot: a secondment Agreement (the ‘Agreement’) between DataDot and the defendant dated 1 August 2008, and a secondment letter (the ‘secondment letter’) between the plaintiff and the defendant dated 18 September 2006.

18. The Agreement recorded, by way of “Background”, that the CSIRO and DataDot had formed a joint venture to commercialise the DataTrace technology and that:

“To assist with product development and the commercialisation of DataTrace, DDT have requested that Dr Gerry Swiegers (the ‘Secondee’) be seconded to DDT. CSIRO has agreed to provide the Secondee with two years’ leave without pay to facilitate this arrangement.”

19. Clause 2 of the Agreement relevantly provides:

“2.1 CSIRO will second the Secondee to work for DDT for a period of two years effective from the Effective Date (‘Secondment Period’), unless the Secondment is terminated earlier in accordance with this agreement.

2.2 The Parties agree that for the duration of the Secondment Period, the Secondee will be an employee of DDT. CSIRO will provide the Secondee with two years’ leave without pay to facilitate this arrangement.”

20. The Agreement provided that 80 per cent of the plaintiff’s work hours was to be devoted to the completion of work for DataDot and 20 per cent was “to be devoted to the completion of work for CSIRO, during which time the Secondee will be directed by CSIRO.”

21. Dr Graeme Woodrow, the Chief of the CMHT, wrote in the secondment letter:

“I wish to formally advise that I have approved your application for two years leave without pay to undertake a secondment with DataDot Technology (Australia) P/L (DDT), under the following conditions” (Italics added).

22. Clause 2 made provision for the period of the secondment as follows:

“2. Period of Secondment

This approval for leave without pay is given for a period of two years. There is no automatic entitlement for you to be placed back in the Division should you wish to return after a lesser period. If you do wish to return within two years could you please advise us at the earliest opportunity and full consideration will be given to your early return.

…”

23. Clause 6 provided:

“6. Return to CSIRO

It is expected that you will continue to liaise with the Chief or his delegate, in respect to the new skills that you have acquired and your expectations on return to the Division. This information will be used to develop a role for you within the Division that maximizes the additional skills that you have gained.

If you also agree to the terms of his (sic) secondment, please sign the enclosed copy of this letter and return it to me.

The secondment to DDT is effective from 24th July 2006. I wish you and DDT success.”

24. Whilst on secondment from the defendant, the plaintiff continued to perform work based at the CSIRO’s Clayton offices, where the research was to be undertaken. From February 2007, the terms of the plaintiff’s secondment were altered by the defendant, to 100 per cent employment by DataTrace. The plaintiff thereafter worked exclusively for DataDot.

25. During the secondment period, a number of disputes arose between the plaintiff and senior managers within the CSIRO. In April 2007, DataDot sought permission from the defendant to offer the MDI technology to Microsoft, which was rejected by Dr Geoffrey Houston (the business development manager for the security technologies group within the CMHT) on behalf of the defendant. This prompted the plaintiff to make complaints in two emails sent on 4 April 2007, to Drs Houston, Gerard Wilson (theme leader, flexible electronics), Woodrow and others, reflecting his frustration about the rejection of DataTrace offering the MDI technology to Microsoft. The plaintiff raised concerns and allegations as to potential breaches of commercial laws by Drs Wilson and Houston.

26. On 5 April 2007, Dr Wilson sent an email to Mr Graham Black (Human Resources (‘HR’) manager of the CMHT), which was copied to Drs Houston, Gregory Simpson (deputy Chief of the CMHT), Woodrow and others on the executive management team of the Division. The email stated that Dr Wilson had just spoken to Dr Woodrow about the plaintiff’s email and that Dr Woodrow had told Dr Wilson that the plaintiff’s email “[It] implicates various people, both directly and indirectly, so Graeme [Woodrow] believes our response needs to be as a team. So welcome aboard!!”

27. On 27 June 2007, the plaintiff lodged a formal complaint under the defendant’s Whistleblower Policy concerning the conduct of five of the CSIRO officers, Mr Black, Drs Simpson, Wilson, Houston and Woodrow at the CMHT and their roles in the commercialisation of the Datatrace and MDI technologies (‘the Whistleblower Complaint’). By way of an “addendum” dated 29 January 2008, Dr Peter Osvath (group leader, security) was added as a respondent to the Whistleblower Complaint.

28. On 13 November 2007, Dr Rebecca French from Mallesons Stephens Jacques (‘Mallesons’) was appointed to investigate the complaints the plaintiff had made in the Whistleblower Complaint. On 3 October 2008, Mallesons issued the “Whistleblower Complaint Report” which stated that none of the plaintiff’s allegations, which had been considered, were made out, but made recommendations on improving the CSIRO policies.

29. Throughout the secondment period, decisions were made in relation to projects the plaintiff had been involved in, including a decision to cancel the Biomimetic Catalysis project in December 2006 and the closure of the MDI project in or around November/December 2007.

30. The plaintiff was due to return from secondment to the CSIRO on 24 July 2008. By agreement between DataTrace and the CSIRO, the plaintiff’s secondment was extended by six months until 27 January 2009.

31. On 4 December 2008, Dr Osvath emailed the plaintiff and others, inviting them to apply for an internal vacancy for the role of National Security Technology Partnership Theme Leader. The plaintiff did not apply for that position.

32. On 8 December 2008, Dr Gregory Coia (senior manager and project leader from the CMHT) informed the plaintiff that the Division did not have a position for the plaintiff to return to from his secondment.

33. The CSIRO Terms and Conditions of Service (JCDB 1, T13), as they existed after November 2007, made provision with respect to the termination of the appointment of certain officers employed by the defendant. In relation to indefinite officers, cl 12.2 states:

“12.2 Where the authorised person makes no determination under sub-paragraphs 12.1 or 12.1A, thereby specifying no period of appointment, the appointment may, subject to the Terms and Conditions, be terminated for the following reasons -

(- grounds for termination of employment)

(a) Deleted ;

(b) inefficiency, incompetency, incapacity or unsuitability (Paragraph 15);

(c) redundancy (Paragraph 16);

(d) being found guilty of an offence warranting dismissal (Paragraph 19F);

(e) a conflict of interests (Paragraph 20B).”

Clause 16.1 is entitled “Excess officers” and includes the following term:

“16.1 If at any time the Authorised Person finds that it is necessary to curtail any phase of the activities of the Organisation, and that as a consequence any officer is no longer required for the efficient working of the Organisation, or if at any time the Authorised Person finds that a greater number of officers of any designation is employed than is necessary for the efficient working of the Organisation, any officer whom the Authorised Person finds is in excess may be retired from the Organisation or may be transferred to such other duties as would be carried out by an officer of equal classification and salary in the Organisation as the officer is competent to perform, or to duties which would be carried out by an officer of lower classification and salary with payment appropriate to such lower classification.”

34. The CSIRO Enterprise Agreement 2005-2008 (Ex A) applied until 25 June 2008 and made provision with respect to redundancies. Clause 3(a) of Sch 3 made provision for obligations to inform and consult affected employees (conveniently referred to as the ‘R&R Policy’):

“Where it appears that an officer is likely to become excess to Divisional or Business Unit requirements, the Chief (or equivalent) will, at the earliest practicable time advise the officer of the situation, provide the officer with comprehensive information concerning redundancy procedures and available assistance and carry out a CSIRO-wide survey of existing and foreseeable vacancies which are at, or one level below, the officer's substantive CSOF level and in the same functional area. If there are no apparent redeployment opportunities and the redundancy is to proceed, the officer will be formally advised in writing that they are potentially excess and will be provided with the following information:

• details of the circumstances which have given rise to the potential redundancy;

• the method of identifying the officer as potentially excess;

• potential redeployment, including retraining prospects, within the Division and more broadly, within CSIRO;

• other options which might prevent the redundancy (eg substitution by other officers); and

• details of the termination benefits which apply in the event that redundancy is confirmed.”

35. This agreement was replaced in December 2008 by the CSIRO Enterprise Agreement 2008-2011 (Ex B). Similarly, it made provision for affected employees to be advised of potential redundancy as soon as practicable. Clauses 3(b), (d) and (f) of Sch 3 state:

“(b) Where it appears that an officer is likely to become redundant the Delegate will, at the earliest practicable time advise the officer of the situation and provide the officer with comprehensive information concerning redundancy procedures and available assistance.

The officer will also be provided with the following information:

• details of the circumstances which have given rise to the potential redundancy;

•the method of identifying the officer as potentially redundant;

• potential redeployment, including retraining prospects, within the Business Unit and more broadly, within CSIRO;

• other options which might prevent the redundancy (e.g. substitution by other officers); and

• details of the termination benefits which apply in the event that redundancy is confirmed.

CSIRO will carry out an organisation-wide survey, of existing and foreseeable vacancies which are at, or one level below, the officer’s substantive CSOF level and in the same functional area. From 1 December 2009 the minimum period over which this survey will be conducted will be 8 weeks or a shorter period may be agreed between CSIRO and the officer.

…

(d) If there are no apparent redeployment opportunities and the redundancy is to proceed, the officer will be formally advised in writing.

…

(f) If an officer does not contest redundancy and agrees to a termination date that is within 10 working days of receipt of the formal advice referred to in subparagraph (d) of this paragraph, the officer shall be paid the equivalent of 8 weeks pay in addition to the termination benefit options provided by paragraphs 4 (lump sum) or 6 (income maintenance). During this 10-day period the officer must provide formal advice as to their preferred benefit.”

36. Clause 4 of Sch 3 of the CSIRO Enterprise Agreement 2008-2011 provided the following information with respect to lump sum payments:

“Lump Sum Payment

1. An eligible officer who is retrenched will receive a lump sum payment calculated in accordance with this paragraph UNLESS the officer elects to receive income maintenance as provided in paragraph 6. This election must be in writing and be submitted to the Chief (or other Delegate) at least 5 working days before the termination date.

2. Subject to a minimum payment of 4 weeks pay and a maximum of 48 weeks pay, the Lump Sum payable to a retrenched officer will be 2 weeks salary for each completed year of continuous service PLUS a pro-rata payment for any additional completed months of continuous service. The sum payable under this subclause shall not exceed the sum of salary that would be payable were the officer to continue in employment until they reach the age of 65.

3. If an officer has received payment of an Enhanced Responsibilities Allowance (ERA) for a continuous period of at least 12 months preceding the date on which formal advice of potential redundancy is given under paragraph 3 (d), salary for the purposes of calculating the lump sum payable will include the ERA.

4. Where an officer regularly receives payment for shift work, restriction duty (i.e. on-call) or overtime [i.e. in 50% or more of the pays received in the 12 month period preceding the giving of notice under paragraph 3(d)], the average fortnightly payment during that period will be included for the purpose of calculating the lump sum payable.

5. First Aid Allowance, Superior Performance Rating (Premium Step) and AAHL Site Allowances will be included in calculating the lump sum payable.”

37. On 16 December 2008, Mr Black emailed the plaintiff and attached a letter which stated the following:

“This letter confirms the verbal advice given to you by Greg Coia on 8th December that we believe that we may not have a role at CMHT for you at the conclusion of your secondment with DDT in late January 2009. Given the lack of certainly (sic) around a future role at CMHT you are hereby advised that you are potentially surplus to the Business Unit’s staffing requirements.

This situation has arisen due to staffing changes in the National Security Technology Partnerships Theme necessitated by a decreased funding allocation through SIP 3 to the Theme. Naturally we will fully explore other opportunities within the rest of the Division and I believe Greg also advised you that the Division does have a number of senior roles vacant for which you are encouraged to consider applying for. Selection for these senior roles will be based on merit.

Whilst we will continue to examine all opportunities within CMHT we also believe it is appropriate at this time to initiate a wider search for a suitable role for you within other Business Units, in particular Energy Technology, which you mentioned to Greg Coia.

As a designated potentially surplus officer you have preference for any roles at or below your existing classification level for which you are deemed suitable. In all other circumstances, you may compete on merit for any advertised role. You should therefore apply for any roles within the Organisation that suit your skills and abilities.

The CSIRO Capability Transition Team: will assist in the search for other opportunities. For this search it is essential that we have a current CV and an indication as to whether or not you wish to be considered for roles in other states and regions outside of Melbourne. Also an indication whether or not you would like to consider available roles lower than your existing substantive level would also be appreciated to help define the search. Could you please forward a current CV to me and these indications as soon as possible.

Ideally you will be considered for any opportunities before proposed advertisements are placed but you should also consider and apply for opportunities in CSIRO which suit your interests, skills and abilities as they appear in Jobs Central. Please notify your P&C staff of any roles you apply for so they can ensure your interests are protected.

Every effort will be made to redeploy you within CMHT, or another Business Unit subject to your advice on which states you are prepared to consider relocation to. Staff will become surplus to the requirements of CSIRO only if redeployment efforts are not successful. Further information on redeployment is available at CSIRO Jobs Central: we are unable to place you in a suitable role you may be provided with access to career transition services, or a reasonable level of assistance towards retraining. The Division will also pay for independent financial advice up to the value of $500. I would also like to remind you of the free and confidential counselling services provided by IPS an Employee Assistance Program (EAP) in CSIRO. The EAP is a free, confidential service and offers short-term professional off site counselling, face-to-face (preferred) or telephone counselling. Counselling services can be accessed by calling 1300 366 789 Monday to Friday (8:30am-6pm) for an appointment.

I understand that you have enquired of Greg Coia as to the possibility of extended leave during 2009. Consideration of any formal request for leave from you would occur following the outcome from the redeployment efforts outlined above.

Finally, should there be any issue you would like to discuss further, please contact me.”

38. On 27 January 2009, the plaintiff emailed Mr Black. This email included the following:

“I spoke on Friday with Paul Savage regarding a redundancy. Viki [Pinkard] also sent me some information on the options available in this regard. Would it be possible for you to please calculate and let me know the benefit I would receive (including Lump Sum, Long-Service Leave, and Rec Leave payments) if I took the “early cessation” option with (sic) termination date 8 February 2009?”

39. Mr Black met with the plaintiff on the morning of 27 January 2009. Mr Black told him that it was highly unlikely that he could depart the CSIRO on 8 February 2009, but that the HR Division would do their best to fasten the process.

40. On 3 February 2009, Mr Black emailed the plaintiff an estimation of his cessation benefits. The plaintiff replied to this email on 16 February 2009 and asked Mr Black to confirm that these calculations excluded “the 8 week salary payment that goes along with the early cessation option?” By an email of the same date, Mr Black confirmed that the calculation included “the 8 week fast track payment.”

41. In a letter dated 9 February 2009 (the ‘termination letter’), Mr Black gave formal notice of the termination of the plaintiff’s employment and provided information about the available retrenchment benefits. He stated:

“I have previously advised you on 16 December 2008 that you are potentially surplus to the staffing requirements of CSIRO Molecular & Health Technologies and since that time I have carried out a CSIRO wide survey of existing and foreseeable vacancies.

This letter confirms that, as no apparent opportunities for redeployment exist, you have become redundant to the staffing requirements of CSIRO.

…

… [A]n “early cessation” payment of 8 weeks pay will be made if you do not contest redundancy and agree to cease employment on or before 23 February 2009 (Italics added).   

Formal notice and termination

You are entitled to receive 5 weeks notice of termination except where you elect to take the “early cessation” option. Unless you secure alternative CSIRO employment in the meantime, this notice will be issued on 9 March 2009 and your services will be terminated at the expiration of the notice period on 13 April 2009.”

42. The plaintiff emailed Mr Black on 20 February 2009, stating:

“This redundancy, as you know, has been forced on me. I therefore confirm that I will terminate employment on Mon, 23 Feb.”

43. The plaintiff received a redundancy payment of $50,845.16, together with the early cessation payment of 8 weeks’ pay equalling $18,630.28, totalling $69,475.44 (Ex 23, V11, T273).

44. On 23 February 2009, the plaintiff’s employment with the defendant ceased.

45. Three days later, the plaintiff commenced part-time employment with DataDot in the position of vice president of strategic research at DataTrace.

46. The plaintiff ceased his employment with DataDot on 9 March 2012.

47. Since 2010, the plaintiff has been employed on a 10 year, half-time term appointment as a Professor in the Faculty of Science at the University of Wollongong (‘UOW’). His contract expires on 7 February 2020.

48. The plaintiff’s work at the UOW has included the development of organic solar cells capable of splitting water into hydrogen and oxygen when illuminated by sunlight and the commercialisation of a low-cost electrochemical cell that splits water into hydrogen and oxygen. AquaHydrex Pty Ltd (‘AquaHydrex’), a spin-off company that has been formed, secured a $5 million investment from a US venture capital firm. The technology was also awarded a $2.2 million Clean Tech grant in 2013.

49. The plaintiff commenced proceedings against the defendant by filing a Statement of Claim in this court on 3 May 2013.

Format of judgment

50. What follows in this judgment has been placed under the headings Argument, Matters of Evidence and Consideration. This approach has been adopted in order to identify and give appropriate consideration to the issues in the proceedings. The evidence (both oral and documentary) has been extensive and the parties’ submissions have occupied many written pages and were spoken to on 30 June 2015.

51. For the sake of some brevity, I have not endeavoured to recount all of the evidence under Matters of Evidence that relate to an issue. Furthermore, much of the evidence overlaps and the placement of a particular piece of evidence in a part of this judgment does not mean that my consideration of it has been confined to a particular issue, or considered in insolation. All of the evidence has been considered in combination. Similarly, not every argument of the parties has been summarised, but considered.

A question of credibility – the Sting email

52. A matter that was said by the defendant to irreparably damage the plaintiff’s credibility was the plaintiff’s claim, that was withdrawn at the hearing, that a meeting arranged via email with the subject line ‘Sting’, with Mr Black and Drs Wilson and Osvath on about 3 December 2008, had a sinister purpose and indicated a conspiracy.

53. The defendant argued that the court should find that the plaintiff falsified a copy of the original ‘Sting’ document by writing in the names of Dr Osvath and Mr Black to match his false evidence about ‘seeming’ to see the names flash up on the screen at the time of the original printing. The defendant submitted that the truth of the matter was that the plaintiff assumed that any ‘Sting’ meeting may have involved Mr Black and Drs Wilson and Osvath, as at the relevant time, the plaintiff suspected that these persons were on the selection panel for the Theme Leader role.

54. The defendant referred to correspondence between the parties’ solicitors, and the plaintiff’s solicitor’s refusal to provide a full explanation regarding the creation of the ‘Sting’ document. The defendant contended that the plaintiff refused to provide the information sought, even after his solicitors were put on notice that the defendant was investigating the authenticity of the document.

55. What was even more damaging for the plaintiff’s credit the defendant argued was that, once he realised the GS73 ‘Sting’ document had been revealed as a fake, the plaintiff nonetheless sought to engage his own expert evidence through Professor Robin Braun. The defendant pointed out that when answering the plaintiff’s question, Professor Braun was not instructed to review the CSIRO IT system. The defendant argued that the court ought to infer that the plaintiff sought to engage an expert in this manner in order to “raise a red herring” (T95, 43) to cast doubt on Mr Rodney McKemmish’s (Partner, PPB Advisory) conclusions without a proper basis for doing so.

56. In written submissions, the plaintiff explained that he thought that the calendar entry referred to a meeting arranged by Drs Wilson, Osvath and Mr Black. However, he accepted that he was mistaken, a meeting did not appear to have occurred between those individuals on that date, and the entry had another meaning entirely, relating to the performer ‘Sting’. The ‘Sting’ email played no part in his case.

Matters of Evidence

57. The plaintiff pleaded in all versions of his Statement of Claim and para 23 of his further ASOC that:

“On about 3 December 2008, Mr Graham Black, Dr Gerry Wilson and Dr Peter Osvath arranged a meeting via email, which had a subject line of ‘Sting’.”

58. The context in relation to para 23 of the further ASOC was outlined by Mr Gibian in his opening address (T12, 2-5; 14-17):

“The plaintiff upon discovering that calendar entry discerned a meaning to that as having some reference to him and discerned a sinister intent behind that meeting…

The plaintiff did discern that meeting as having some effect on him given its timing arising as it did a short time before in circumstances where he was concerned about his employment and shortly before being advised that he was to be made redundant.”

59. The plaintiff recounted in his first witness statement dated 17 January 2014 (Ex D, 119):

“I am aware that on 3 December 2008 Mr Black, Dr Wilson, and Dr Osvath arranged a meeting via email, which had the subject line ‘Sting’. Annexed and marked GS73 is a copy of an Outlook Calendar Appointment for 3 December 2008. I obtained a copy of this Outlook Calendar appointment as I had access to this entry as an ordinary part of my work at CSIRO.”

60. Annexure GS73 is as follows:

“Outlook Calendar Appointment

From: Gerry Wilson

To: Peter Osvath, Graham Black

Subject: Sting

Start: Wed 3/12/2008 4:30 PM

End: Wed 3/12/2008 5:00 PM

Recurrence: (none)”

NOT IMPLEMENTED: support for w:pict - without v:imagedata

61. On 2 April 2014, Mr Jamie Ronald from the plaintiff’s solicitors wrote to the defendant’s solicitors in response to their letter of 27 March 2014, titled “Meeting via email subject line ‘Sting’” requesting particulars of the plaintiff’s witness statement (Ex 23, V11, T212, Ann F). Mr Ronald stated that if the plaintiff “were to answer your request, he would, in effect, be permitting himself to be cross examined via correspondence. He does not so consent.”

62. On 9 April 2014, Mr Jason Noakes, from the defendant’s solicitors, wrote the following to the plaintiff’s solicitors (Ex 23, V11, T212, Ann G):

“We refer to your letter dated 2 April 2014.

We note your client’s refusal to inform the CSIRO how he came to be in possession of a purported Outlook Calendar Appointment titled “Sting”, now attached as Exhibit GS73 to his witness statement.

We put you on notice that the CSIRO is currently investigating the authenticity of this document, and the CSIRO has briefed internal and external IT consultants as part of this process.”

63. In Dr Wilson’s first witness statement dated 28 April 2014 (Ex 16, 40) he stated:

“The only reason I can fathom as to why I might have created an appointment in my Outlook calendar for that date with the title “Sting” is that I wanted to remind myself that Sting (from the band, The Police) was playing in Melbourne that night. This was a usual practice of mine, particularly to a social event that was not scheduled to take place for some months. My wife and I had contemplated attending the Sting concert. However, at some point, one of my work colleagues, either Pat Hartley or Scott Watkins, I cannot now recall which, told me that Sting was going to be performing songs from his recent Elizabethan era music phase. This is a very different type of music to that played by Sting with his band, The Police. I raised this with my wife and we both agreed that an evening of Elizabethan music was not our “cup of tea”. I know that Sting did play in Melbourne on 3 December 2007 (Tab 149I). However, we did not attend Sting’s concert that night.”

64. The “FRONTIER” website was accessed on 28 April 2014 (Ex 23, V9, T149I) and included the following information in relation to “STING - AUSTRALIA 2008”:

“New York, NY – In support of a special edition of the critically-acclaimed album, Songs from the Labyrinth – a personal tribute to late 16th-century Elizabethan composer, John Dowland (1563–1626) - Sting will embark on a tour of Australia this summer, joined by esteemed lutenist, Edin Karamazov, including performances in Sydney, Brisbane, Melbourne and Perth (see below for itinerary)…”

65. In Mr McKemmish’s first witness statement dated 28 April 2014 (Ex 40, Ann A [68]) he stated:

“Arising from my forensic examination of Dr Gerry Wilson’s CSIRO laptop computer, and selected restored mailboxes for the period November 2008 and December 2008, I note the following:

a)   The calendar appointment titled “Sting” exists in the archive folder located within Dr Gerry Wilson’s CSIRO laptop computer.

b)   The archived “Sting” calendar appointment is identical to the restored “Sting” calendar appointments located in both the November 2008 and December 2008 backups of Dr Gerry Wilson’s mailbox.

c)   None of the “Sting” calendar appointments identified by me contain indicators that the calendar appointment had been forwarded to “Peter Osvath” or “Graham Black”.

d)   There is no evidence in the restored mailbox of Dr Peter Osvath and Mr Graham Black to indicate that they received the “Sting” calendar appointment.

e)   A number of users and user groups have sufficient access to Dr Gerry Wilson’s calendar so that they could see details of each appointment.

f)   In the absence of any further information regarding the source of the “Sting” Outlook Calendar Appointment as presented by Dr Swiegers, I am of the view that this version is either:

i.   an amended and unsaved version of the original calendar entry; or

ii.   an entirely new and unrelated calendar entry.”

66. On 26 May 2014, Mr Ronald wrote to Professor Braun of the University of Technology Sydney, in relation to the plaintiff’s request for Professor Braun to provide an expert report concerning the capabilities and possible configurations of Microsoft Outlook. Mr Ronald asked (Ex 23, V11, T216, pg 2):

“(8) Mr Rodney McKemmish’s report is based on a restoration process conducted by CSIRO IT. In your opinion, is it possible that the archived information may have been compromised before it was provided to Mr McKemmish?”

67. In the plaintiff’s second witness statement dated 13 June 2014 (Ex E, 240-242) he stated:

“At around the time of my retrenchment by CSIRO, I happened to notice that Dr Wilson had shared his Outlook Calendar and that I was able to see his calendar by checking the appropriate box in my Outlook Calendar. Annexed and marked GSR59 is a screen-shot taken at that time, showing my computer screen when Dr Wilson’s and my Outlook Calendars were displayed side-by-side.

I noticed however that I was not able to open individual appointments in Dr Wilson’s calendar in their original form, except to print them in the “memo-style” that is used by Microsoft Outlook. In this format, they did not show the sender and recipient of the appointment.

However I noticed that immediately upon clicking upon an appointment, a screen become momentarily visible that appeared to include sender/recipient information. I had to repeat the printing several times to identify what was shown on the screen. In this way it appeared to me that I was able to identify senders and recipients.”

68. In Mr McKemmish’s supplementary witness statement dated 12 August 2014 (Ex 41, Ann A [1(d)], [34]-[37]) he stated:

“As a “Reviewer” a person is able to open a calendar appointment in a shared calendar and see all details, including whether the appointment had been sent to other recipients.

Additionally the ability to print suggests that Dr Swiegers had permissions set to “Reviewer”. Under “Reviewer” a person is permitted to access a calendar entry in its entirety by clicking on it and is permitted to print same. In accessing the calendar entry, the person would be able to view full details including if there was a sender or recipient.

Further, at paragraph 241 of Dr Swiegers’ Reply Statement, he notes that when referencing the printing of the individual appointment in “memo-style” that “they did not show the sender and recipient of the appointment”. I note that this statement is at odds with both GS46 and the original “Future role for G Swiegers” appointment printout, both of which show the recipients details next to the heading “Required Attendees”.

Given the content of paragraph 241 and my comments above, I am of the view that Dr Swiegers’ assertion that he was restricted from accessing the “Sting” Outlook appointment, and yet was still able to print it, conflicts with the way permissions are enforced within Microsoft Outlook 2003 and with the way the Exchange 2007 server was configured.

At paragraph 242 of Dr Swiegers Reply Statement, he notes that “immediately upon clicking upon an appointment, a screen became momentarily visible that appeared to include sender/recipient information.” He further notes “I had to repeat the printing several times to identify what was shown on the screen. In this way it appeared to me that I was able to identify senders and recipients.” Dr Swiegers description in paragraph 242 appears to draw a link between the act of printing and the momentary presence of the screen. Proceeding on this basis, the assertion that a screen containing more information than what the user has privileges to access (as outlined in paragraph 241) is at odds with how Microsoft Outlook manages shared information. When a user grants limited calendar privileges to another user, the information available to that user is restricted to the permissions as granted.”

69. Annexure GS46 is as follows:

“Outlook Calendar Appointment

From: Graham Black

Subject: Confidential Future role for G Swiegers

Location: Greg Simpson’s office

Start: Fri 19/10/2007 12:30 PM

End: Fri 19/10/2007 1:30 PM

Recurrence: (none)

Required Attendees: Simpson, Greg (CMHT, Clayton); Wilson, Gerry (CMHT, Clayton); Osvath, Peter (CMHT, Clayton)

Dear all

As mentioned previously, I would like us all to be clear about future role for Gerry on his return from secondment in July 08 regards”

70. In cross-examination, the plaintiff gave the following evidence in relation to the ‘Sting’ calendar entry (T61, 3-14; T61, 39-50; T62, 1-30; T67, 29-44; T69, 6-30; T95, 34-41):

“Q.  Because as far as you were concerned, the sting' email was your trump card for proving the conspiracy, correct?  Until you realised that we knew it was false, you considered that your trump card in proving the conspiracy, correct?

A.  Well, it seemed to indicate a conspiracy, yes.

Q.  Come back to my question.  You considered it your trump card to prove your conspiracy; didn't you?

A.  It seemed to indicate that, yes.

Q.  You're agreeing you considered it your best point?

A.  It seemed to indicate that, yes.

…

Q.  Then if you could turn over page 7 at paragraph 23 you refer to a meeting on 3 December, arranged a meeting, subject sting', and you name three of the six whistle blower respondents, correct?

A.  Yes.

Q.  Then you show that the next day that you were invited to apply for a job with three of the four members that were on the committee?

A.  Yes.

Q.  You also show that those three members were also the three members that were going to attend the sting' meeting, correct?

A.  Yes

Q.  Then you show you allege that only five days later you told you were made redundant.  Do you see that?

A.  No, four days later.

Q.  It was 3 December is the sting' meeting‑‑

A.  Five days after.

Q.  ‑‑and you're showing five days you were told you're made redundant?

A.  Yes.

Q.  If this case had have gone forward before we got a forensic expert in, you would've tendered your sting' document to show that three people met, wouldn't you?

A.  I did, yes.

Q.  There would've been the risk of a great injustice if on reliance of that document, your trump card, six senior officers of CSIRO have been found to enter a conspiracy to make you redundant, correct?

A.  Yes.

Q.  You've known for a long time that the email you exhibited was false?

A.  It was ‑ perhaps I should explain‑‑

Q.  No, just answer my question, please.  You've known for a long time the email you exhibited showing the sting' meeting was false?

A.  It was not a direct copy of the printout that I had.

Q.  And we'll go to your statement; your statement had not indicated it wasn't a direct copy, had it?

A.  No, it didn't.

…

Q.  There is a big difference between saying, here is a copy of a document I obtained, as distinct from, here is a document I have created, correct, there is a big difference?

A.  Well I think, so I am not a lawyer and the term "copy" doesn't necessarily mean a photocopy for me but I understand that in the law, which I didn't understand at the time I wrote this, that the word "copy" means actually a photocopy but, so in that sense, I didn't understand exactly the implications of saying the word "copy" here.

Q.  Do you agree on a fair reading of 119, you were suggesting that you had taken a photocopy or printed out a copy of the calendar appointment invitation, weren't you?

A.  I agree that it could be interpreted that way, yes.

Q.  I suggest to you that is the impression you wanted to give, wasn't it?

A.  Yes.

…

Q.  Now you are using the word "seemed"?

A.  Yes, because I am not sure any more but it seemed, it felt like it was correct at the time.

Q.  Because what you then did is you added to the top of what the document you printed out from Gerry Wilson to Peter Osvath and Graham Black, correct?

A.  Yes.

Q.  And anyone looking at that document in your witness statement, you would agree would think you have printed out that document and that is how it looks?

A.  Well, I think it was intended that ‑ to show that was a header, it was intended to show that the bit between the lines was the appointment, but I accept that someone who looked at that would think maybe that was the whole thing.

Q.  Because one of the things you complain about in your whistleblower complaint, is you say people engaged in misleading and deceptive conduct?

A.  Yes.

Q.  Do you agree, by you adding those things in was quite misleading?

A.  Yes, it was and it was inadvertently so.

Q.  And it was quite deceptive?

A.  It was not intended to be and as soon as I found out about it, I acknowledged it and made it clear.

…

Q.  You instructed your expert to speculate whether there had been some tampering of the system?

A.  Well that was one possible explanation.  There were a number of possible explanations and we wanted him to comment on and help us understand how this had happened.  The one explanation and I accept now that that was the correct one was that I had made a mistake and I had not seen what I thought I saw.  Another possible explanation is that CSIRO had actually done something here.  So we just wanted to canvass all options.”

71. In cross-examination, the plaintiff gave the following evidence in relation to GS46 (T99, 35-50; T100, 1-22):

“Q.  You knew if you produced this document, and you made it look like the sting' document, people would assume the authenticity of the sting' document because CSIRO would know this email had gone out.

A.  Yes.

Q.  And so you deliberately, when recreating the sting' document and creating this document, made them look alike with the same type face and everything, so people would assume they were both originals, or copies of the original and weren't created by you?

A.  These documents were prepared and sent to Comcare.  They were part of a number of these documents in the letter to Comcare, and that's where they came from.  I had no legal action against CSIRO at that time.  At that time, actually, I wasn't even contemplating it.

Q.  Can we just show you a document that we received this morning, and we've made a notation on it.  We asked your solicitors to produce the original of this document.

A.  Yes.

Q.  We've made a note up the top, "Copy of original produced by Dr Swiegers' solicitors today".

A.  Yes.

Q.  Do you see that it comes out in exactly same form as the original you produced regarding the sting', with your name up the top, except there's ‑ in the sting' one, there's no required attendees, see that?

A.  Yes.

Q.  And like with the sting' when you've recreated the sting' document showing invitees, you have removed ‑ when you go back to GS46, removed the Gerry Swiegers, so it looks exactly the same, and you've written up the top, "Outlook calendar appointment exactly the same as the sting' document from Graeme Black"?

A.  Yes.

Q.  And you did that so the people wouldn't realise that you had falsified these documents?

A.  No, absolutely not.”

Consideration

72. It must be remembered that the plaintiff no longer relied on the ‘Sting’ email as part of his case. He accepted that he had wrongly believed that it indicated a conspiracy against him. However, his conduct in adding “From: Gerry Wilson To: Peter Osvath, Graham Black” to the top of GS73 was not adequately explained by his testimony that the term “copy” did not necessarily mean a photocopy.

73. By adding those names, the plaintiff was seeking to bolster his claim that his termination by the CSIRO was not genuine, but was the product of ill will towards him by the CSIRO officers who were the subject of the Whistleblower Complaint.

74. It is evident from Mr McKemmish’s statement that the plaintiff could not have seen that the ‘Sting’ email had been forwarded to Dr Osvath and Mr Black. Furthermore, the only reason that Dr Wilson created the ‘Outlook Calendar Appointment’ was to remind himself that the band ‘Sting’ was playing in Melbourne on 3 December 2008.

75. I do not accept the plaintiff’s evidence that his conduct was not intended to be deceptive but was the product of inadvertence. Whilst I find that the plaintiff gave disingenuous evidence concerning the ‘Sting’ email, I reject the defendant’s submission that it irreparably damaged the plaintiff’s credibility. However, it demonstrated the lengths that the plaintiff was prepared to go, to establish his belief that there were those in the CSIRO who were maliciously acting together against him. The plaintiff’s evident fixation with collusion, conspiracy and mala fides seriously undermined his credibility. I found that I was unable to accept such of his testimony that was controversial without independent evidence which indicated that the plaintiff’s evidence was true.

76. It is convenient to provide here my evaluation of the principal witnesses for the defendant (Mr Black, Drs Savage, Wilson, Osvath, Simpson, Coia and Woodrow). I did not discern from their testimony before me that they acted at any stage with mala fides towards the plaintiff. Of those witnesses, who were the subject of the Whistleblower Complaint, they were prepared to admit that their relationship with the plaintiff had deteriorated, but I accept the general thrust of their evidence that they acted in the best interests of the CSIRO and were not motivated by a dislike for the plaintiff.

77. Although I did not accept the interpretation of cl 6 of the secondment letter (see [209] below), I found them overall to be honest and reliable witnesses.

Is the plaintiff’s claim barred by reason of his acceptance of the “early cessation” payment?

Argument

78. The focal point of the argument is the plaintiff’s acceptance of the early cessation payment.

79. The defendant contended that the plaintiff, by requesting the “early cessation” option, entered into a bargain with the CSIRO in return for the payment of an additional 8 weeks’ salary, resulting in the sum of $18,630.28 being paid to him. The defendant argued that the plaintiff, as part of this bargain, gave up his right to “contest” his “redundancy.”

80. The defendant submitted that the plaintiff cannot take the benefit of his bargain but avoid the burden of it. By accepting the early cessation payment in exchange for a promise to “not contest redundancy”, the plaintiff entered into a contractual bargain by which he released the CSIRO from liability from any suit, or legal proceedings brought to “contest redundancy”.

81. The defendant argued that, generally speaking, release clauses are not subject to special rules of construction. What needs to be shown, the defendant submitted, is that the language used discloses an intention to give up some right, or claim, in return for valuable consideration. The defendant cited Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; (2004) 219 CLR 165.

82. A reasonable person with knowledge of the surrounding circumstances, the defendant said, would understand that the purpose of the transaction, as conveyed by the objective conduct of the parties at the time, was to prevent the plaintiff from launching proceedings to litigate the circumstances of his redundancy, and to provide valuable compensation to him for giving up this legal right.

83. A further argument was that the plaintiff received the “early cessation” payment as satisfaction. The accord for this payment was the agreement not to contest his redundancy.

84. The plaintiff argued that the court would be very slow to reach the conclusion submitted by the defendant on the basis of the words in a form letter, which did not clearly bear that meaning or have that effect. It was contended that to constitute accord and satisfaction, it was necessary to be sure that the plaintiff intended to accept the payment in replacement or satisfaction of any existing right or claim. The plaintiff cited McDermott v Black [1940] HCA 4; (1940) 63 CLR 161 at 183.

85. The plaintiff submitted that to establish that a person is barred from bringing proceedings, it must be demonstrated that there exists an agreement binding upon the person that by clear words included settlement of the claim. The plaintiff put to the court that even if a release is entered into, general words will be read down so as to apply only to matters specifically in the contemplation of the parties. The authorities cited by the plaintiff included Bank of Credit and Commerce International SA v Ali [2002] 1 AC 251 at 260; Grant v John Grant & Sons Pty Ltd [1954] HCA 23; (1954) 91 CLR 112 at 123-124 and Qantas Airways Ltd v Gubbins (1992) 28 NSWLR 26 at 29. Another contention was that a release is given the meaning it would convey to a reasonable person having all the background knowledge which would reasonably have been available to the parties.

86. The plaintiff argued that the words used in the termination letter of 9 February 2009 were not capable of being construed as constituting a release of all legal claims that the plaintiff may have had, or a release at all, and certainly not a release of all contractual rights. It was put to the court that the reference in the termination letter to “contesting redundancy” did not convey by any clear words an intention by the parties that the plaintiff releases any legal claims, let alone all claims arising out of the termination of the plaintiff’s employment.

87. In oral address, Mr Gibian contended that the purpose of the early cessation payment was “to facilitate the expeditious and early resolution of the employment and the reference to contesting is a reference to activating internal processes by way of complaint or grievance to delay or contest” (POS, T959, 34-37). He argued that acceptance of the payment was not bargaining away the right to bring a legal claim for breach of contract or otherwise. He noted that the Enterprise Agreement provides for “review and the like” (POS, T961, 50).

88. Mr Bourke, in oral address, said that this was an “all claims release” and the idea that the early cessation payment was “some type of argy-bargy from an internal process of delay, just simply does not hold water” (DOS, T982, 35-36).

Matters of Evidence

89. The plaintiff recounted in his first witness statement (Ex D, 138):

“On 20 February 2009, after being pressed by Mr Black, I accepted the “early cessation” redundancy that had been offered to me. I understood at that time that there was no possibility that CSIRO would continue my employment and accepted the early cessation benefit accordingly. I believed that even if I failed to accept the early cessation, my employment would in any event not continue and I would be retrenched…”

90. In cross-examination, the plaintiff agreed that he had nominated 8 February 2009 as his date of termination. He denied that he had already planned at that stage to start at DataDot the following month. He said “that was because [he] understood that the early cessation option was that you leave immediately. [He] misunderstood the early cessation option and [he] understood that to get that you had to leave by 8 February” (T123, 41-44).

91. His evidence on this topic included the following (T130, 27-37):

“Q.  So thus if you took the early cessation option you're out the door quicker, correct?

Yes.

Q.  You would be at CSIRO a number of months more if you don't take the early cessation option?

A.  Yes.

Q.  But if you don't take the early cessation option there's more opportunities for you to spot an internal job to go to at CSIRO?

A.  Yes.”

92. The plaintiff agreed that the extra payment that he received for not contesting the redundancy was $18,600. The plaintiff was asked by Mr Bourke (T133, 39-50):

“Q.What happened after this was that you went into CSIRO on 23 February?

A.  Yes.

Q.  Although you were sick?

A.  I wasn't sick, I was stressed out of my bracket.  I did not want to leave the organisation.  I was being forced out the door.  Mr Black was pushing me out the door as hard as he could.  He was saying to me, people were saying to me, if you do this quick thing you'll get a better amount of money, you'll get more money.  I did not want to go.  I wanted to stay and I was forced out the door and I was actually ill on the day from ‑ from that.  I knew if I stayed I would just get less money, I would still be pushed out the door.  That was what was happening on that day so it was not a normal sickness.”

422. In Mr Black’s first witness statement, he explained that an appointment at CSOF5 is “quite different” to an appointment at CSOF7. Mr Black stated that there is “approximately $40,000 to $50,000 difference in remuneration, and approximately 8 to 10 years in terms of experience as a scientist” (Ex 7, 40). He said that there is a huge difference in the CSIRO’s expectations of appointees at these varying levels (Ex 23, T18A). Mr Black further stated (Ex 7, 35-36):

“Based on over two decades of experience in Human Resources, and having overseen the redeployment process carried out by CSIRO in relation to around a hundred employees, I can say that I observed nothing untoward in the redeployment process with respect to Dr Swiegers and the redundancy was genuine.

Futhermore, at no stage during the redundancy and redeployment process did Dr Swiegers inform me that he viewed the redundancy process as a sham or otherwise improperly motivated so as to terminate his employment, or that he did not believe that he was genuinely excess to the CSIRO’s staffing requirements or that his redundancy was not valid for any other reason.”

424. In cross-examination, Mr Black agreed that it was correct that, from time to time, particular research tasks were completed by research scientists at different CSOF levels (T407, 23-27).

425. In Dr Wilson’s first witness statement, he stated (Ex 16, 45 and 116):

“Based on my knowledge of the organisation, I have no reason to doubt that Dr Swiegers was genuinely excess to the staffing requirements of the CSIRO and that his retrenchment was justified and unimpeachable.

…

Dr Michelle Groarke was appointed to a CSOF Level 5 position which was, again, significantly junior to Dr Swiegers’ position of Level 7M. Dr Groarke was appointed to her position through an open, transparent and competitive process. Further, Dr Groarke was appointed to provide deep expertise and a fresh insight to the relevant Capability (the Functional Small Moleclues Group led by Dr Peter Duggan. Her synthetic chemisty skills were in a different area to Dr Swiegers but arguably at an equal or higher level...”

426. In cross-examination, Dr Wilson gave the following evidence (T649, 3-15):

“Q.  Dr Cook was working on a project for Idemitsu?

A.  Correct.

Q.  And Dr Groarke worked on that project once employed?

A.  Yes, correct.

Q.  I think you were not involved at all in the recruitment of Dr Groarke; is that right?

A.  That's correct.

Q.  You don't suggest, do you, that Dr Swiegers could not undertake the work on the Idemitsu project, that is it was suitable for his skills and experience?

A.  Correct.”

427. In Dr Peter Duggan’s witness statement dated 17 April 2014, he said (Ex 32, 27):

“It is correct that Dr Swiegers was not considered for the Idemitsu Role, or any of the CSOF5 roles. He did not apply for these roles. The Recruitment Panel only considered individuals who applied for these positions. If Dr Swiegers had applied, his application would have been given due consideration by the Recruitment Panel. For the purposes of making this statement, I have reviewed Dr Swiegers’s curriculum vitae which was provided to the CSIRO on or around late January 2009 (Tab 164). Based on my review of this document, and noting that Dr Swiegers was a CSOF Level 7M scientist, I consider that, if Dr Swiegers had applied for the Idemitsu Role, it is most likely that he would not have been interviewed, because he was significantly overqualified. In addition, and as mentioned above, part of the aim of recruiting research scientists at CSOF Level 5 at that time to address issues of succession planning within CSIRO and the FSM Group specifically. At the relevant time, the FSM Group had sufficient capability at a senior level commensurate to that of Dr Swiegers.”

428. In cross-examination, Dr Duggan agreed that the plaintiff is a talented and experienced organometallic chemist, who he didn’t have any doubt would have been able to perform the work that was involved in the Idemitsu project (T846, 48-50; T847, 4-6).

Consideration

429. Clause 4.2(b)(iii) of the Document of Appointment provides:

“4.2 Your appointment may be terminated:

…

(b) by CSIRO in the event of –

…

(iii) your becoming excess to CSIRO’s staffing requirements.”

430. The plaintiff’s argument was that he would only be considered “excess to CSIRO’s staffing requirements” if there was no available work for the plaintiff to undertake. In considering the construction of cl 4.2(b)(iii), the plaintiff referred the judgment in Pykett of the Full Bench of the Fair Work Commission where the Full Bench said at [36]:

“…For the purposes of s 389(2) the Commission must find, on the balance of probabilities, that there was a job or a position or other work within the employer’s enterprise (or that of an associated entity) to which it would have been reasonable in all the circumstances to redeploy the dismissed employee.”

431. The Full Bench was considering s 389(2) of the Fair Work Act 2009 (Cth) and not a term of an employment agreement, such as that found in cl 4.2(b)(iii). In any event, the citation of Pykett [it] is helpful at least to the extent of comprehending the plaintiff’s argument. As I understand the submission, available work for a CSOF scientist with the plaintiff’s learning and experience would not mean available work as a cleaner or in another menial role, but must be work that was not only available, but reasonable in all the circumstances for the plaintiff to be redeployed in.

432. The following Table discloses the employment details of the CSIRO scientists, who were identified in para 29(a) of the further ASOC:

Date of Offer	Date of Acceptance	Who	Classification	Pay Offered	CSIRO Docs Tab
26 May 2008	10 July 2008	Dr Giovani Fanchini	CSOF5	$xx,xxx to $xx,xxx	V8, T109
8 July 2008	16 July 2008	Dr Birendra Singh	CSOF5	$xx,xxx to $xx,xxx	V8, T128
31 July 2008	10 August 2008	Dr Michelle Groarke	CSOF5	$xx,xxx to $xx,xxx	V8, T133
9 October 2008	13 October 2008	Dr Christoph-er Dunn	CSOF5	$xx,xxx to $xx,xxx	V9, T140
28 October 2008	23 October 2008	Peter Gray	CSOF3	$xx,xxx to $xx,xxx	V9, T141
20 April 2009	21 April 2009	Dr Juo Hao Li	CSOF4	$xx,xxx to $xx,xxx	V10, T192

433. I note that Dr Groarke did not commence her employment with the CSIRO until January 2009.

434. With the exception of Dr Juo Hao Li, the positions were offered and accepted prior to the determination in December 2008 that the plaintiff was likely to become excess to the CMHT’s requirements. Whilst I accept that the plaintiff was qualified and capable of performing the work of each of the scientists detailed in the Table, all of the positions were at a classification that was much lower than the plaintiff’s position of CSOF7. The highest classification offered (four positions) was at CSOF5.

435. As Mr Black explained, an appointment at CSOF5 was “quite different” to an appointment at CSOF7. There was, he said, approximately $40,000 to $50,000 difference in remuneration, and approximately 8 to 10 years in terms of experience as a scientist. At the time of termination, the plaintiff’s gross salary was $121,485, whereas the highest salary for the advertised CSOF5 positions was $81,429. Dr Groarke was paid $81,000.

436. Dr Li’s appointment was at CSOF4 and Mr Gray at CSOF3. These appointment grades were far below a CSOF7. The highest salary for the advertised CSOF4 position was $76,195 and $61,681 for CSOF3 position.

437. The plaintiff did not apply for any of the positions that were advertised prior to his termination, which is hardly surprising as his qualifications well exceeded those that were required for these roles.

438. It is convenient to mention the position of Dr Cook. The plaintiff pleads in para 27 of the further ASOC:

“Following the formal advice to the Plaintiff that he was to be made redundant, and prior to the redundancy having effect, the Defendant offered Vernon Cook employment in the Plaintiff’s role. Dr Cook accepted the position and commenced work on 13 February 2009.”

439. The pleading is inaccurate and inconsistent with the evidence. Dr Cook commenced employment with the CSIRO on 15 January 2007 on a fixed term contract as a CSOF5 officer in the position of Research Scientist Inorganic Synthetic Chemist in the Transformational Products through Electromagnetic Theme. His position was extended for one month, from 15 January 2009 to 14 February 2009, in the position of Research Scientist, Photo Induced Processes. The contract term was extended from 16 February 2009 for one year, and expired on 16 February 2010. Dr Cook has not worked for the defendant since that time.

440. Dr Cook, at all times, was employed as a CSOF5 officer who, the plaintiff accepted in cross-examination, was not in his league as a scientist. That was obviously the case, given the plaintiff’s high qualifications and experience. Dr Cook is presently employed as a secondary school teacher.

441. The plaintiff was never employed at the CSOF5 Level, but progressed from being a CSOF6 officer to CSOF7M. His employment was converted to indefinite status in December 1998. The position to which Dr Cook was appointed to, on a short-term contract in January 2009, was unrelated to the plaintiff’s role prior to his secondment. Dr Cook did not at any time work on the MDI project or the Biomimetic Catalysis project which had occupied much of the plaintiff’s work before his secondment.

442. I find that Dr Cook was not offered, and did not accept, employment in the plaintiff’s position in February 2009 or at any other time.

443. As to the reasonableness of the plaintiff being redeployed in any of the identified CSOF5 positions, I found Dr Duggan’s evidence to be helpful and, quite frankly, a matter of common sense. Dr Duggan expressed the opinion that if the plaintiff had applied for the Idemitsu Role (a CSOF5 position), it was most likely that he would not have been interviewed, because he was significantly overqualified.

444. Dr Cook accepted that if Dr Groarke’s role had been offered to the plaintiff at CSOF5, it would have been a demotion.

445. In my opinion, a proper consideration of cl 4.2(b)(iii) of the Document of Appointment should not ignore cl 3(a) of the R&R Policy. The CSIRO-wide survey of existing and foreseeable vacancies, which the defendant was obliged to carry out, did not extend beyond one level below the officer’s substantive CSOF Level.

446. The plaintiff was significantly overqualified for any of the positions identified in para 29(a) of the further ASOC. Another matter that the defendant was entitled to consider prior to appointing the plaintiff as a CSOF3 to CSOF5 level officer, were the provisions of cls 6 (a)(i), 6(b) and 6(d)(iii) of the CSIRO Enterprise Agreement 2005-2008. As the plaintiff was over 45 years of age, upon the transfer to a position of lower classification, he was entitled to receive, if an election was made to take the income maintenance option, payments for 14 months to bring his salary up to the salary received immediately before the date of redeployment.

447. I am not satisfied on the balance of probabilities that it was reasonable in all the circumstances to redeploy the plaintiff in any of those positions.

448. I turn now to what was said to be the plaintiff’s future role at the CET Division. It is plain from the reply email by Dr Carras on 23 December 2008, that the plaintiff’s request to move to Energy Technology was rejected. The reason given by Dr Carras was “budget constraints”, which is consistent with the budget cuts that the CSIRO had suffered.

449. During his testimony, the plaintiff said that he met with Dr Carras at the UOW after he returned from leave. According to the plaintiff, Dr Carras told him that he would be putting together a new project, it would then have a budget code and he would be able to transfer. The plaintiff was to be the project leader.

450. The egregious feature about this conversation is there is simply no independent evidence that supports it. There are no emails or other correspondence between the plaintiff and Dr Carras (and anyone else) evidencing it. Furthermore, there is no mention of the conversation in any of the plaintiff’s witness statements. I do not accept the plaintiff’s evidence that such a conversation occurred.

451. In any event, the Biomimetic Catalysis technology research discussions which the plaintiff had participated in late 2007 and 2008, did not come to fruition. The University partners in the catalysis technology, Monash University, the UOW and Princeton University, were unable to reach agreement and the proposed arrangement was discontinued on 23 September 2009. There is no evidence of any other project that was available for the plaintiff in the CET Division in 2009.

Conclusion

452. The plaintiff has not established on the balance of probabilities that the decision to terminate his employment contract was exercised in bad faith and was not genuinely made. Furthermore, the plaintiff has not established that he had not become excess to the CSIRO’s staffing requirements.

453. I am not satisfied that by reason of the failure to develop a position for the plaintiff upon his return from secondment, the defendant breached the plaintiff’s employment contract or converted employment contract (further ASOC 29A).

454. I am not satisfied that the defendant’s termination of the employment contract or converted employment contract constituted a breach or repudiation of the plaintiff’s employment contract or converted employment contract (further ASOC 30, 31).

455. Accordingly, the plaintiff’s claim fails.

Damages

456. Although the plaintiff has not been successful in the present proceedings, the court is obliged to assess damages. Unfortunately, the delivery of the present judgment has been delayed by almost two months due to my recent illness. Being guided by the overriding purpose of s 56 of the Civil Procedure Act 2005 (NSW), I have decided to deliver this judgment on liability. A judgment assessing damages will be delivered in due course.

Orders

457. I make the following order:

Verdict and judgment for the Commonwealth Scientific and Industrial Research Organisation, the defendant, against Gerhard Frederick Swiegers, the plaintiff.

458. I make the following directions as to costs.

459. Costs normally follow the event.

460. Any submissions as to costs are to be filed and served as follows:

i.   Plaintiff is to file and serve any written submissions as to costs on or before 18 January 2016.

ii.   Defendant is to file and serve any written submissions as to costs on or before 25 January 2016.

iii.   Any response by the plaintiff is to be filed and served on or before 29 January 2016.

iv.   Submissions are to be filed by emailing them to Ms Lisa Freeman, my associate.

v.   The parties are to notify the court if, in addition to the written submissions as to costs, oral argument is required on or before 2 February 2016.

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Decision last updated: 18 December 2015