Varas v Fairfield City Council

[2010] HCATrans 18

[2010] HCATrans 018

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney     No S176 of 2009

B e t w e e n -

MONICA VARAS

Applicant

and

FAIRFIELD CITY COUNCIL

Respondent

Application for special leave to appeal

GUMMOW J
HEYDON J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 12 FEBRUARY 2010, AT 2.03 PM

Copyright in the High Court of Australia

MR A.R. MOSES, SC:   May it please the Court, I appear with my learned friends, MR P.D. KEYZER and MS K. EDWARDS, for the applicant.  (instructed by Haywards Solicitors)

MS K.L. EASTMAN:   If your Honours please, I appear with my learned friend, MS E. BISHOP, for the respondent.  (instructed by Leigh Virtue & Associates)

GUMMOW J:   Yes, Mr Moses.

MR MOSES:   Thank you. Your Honours, the special leave questions are crystallised at page 109 of the application book. The central contention is that the respondent’s actions in this case were unlawful by virtue of section 15(2) of the Disability Discrimination Act, the text of which is set out at page 30 of the application book, and that the case raises issues of public importance that require the resolution of the case by this Court. 

In essence, the respondent imputed a disability to the applicant, being a histrionic personality disorder, a psychiatric disorder for the purposes of section 4(g) and (k) of the Disability Discrimination Act, the text of which is set out at page 29 of the application book.  As a result of imputing that disability to the applicant, the respondent directed the applicant to attend a psychiatric assessment for the purposes of deciding whether she should be medically retired or her employment terminated for cause because of conduct which is summarised, and if I could take the Bench to this ‑ ‑ ‑

GUMMOW J:   Just a minute.  Section 5 is pretty important in this structure, is it not?  We looked at that before, I think.

MR MOSES:   Section 5, your Honour, is relevant to the comparator question which is the third issue which we raise in respect of the matter as well.

GUMMOW J:   But that has been repealed, has it not?  Is there a new section 5?

MR MOSES:   It has been amended, your Honour.  The legislature has amended section 5(1) of that Act to delete the words “the same” from the reference to whether or not a person has been treated in a matter different than what they would have treated a person without a disability. 

GUMMOW J:   Sorry, section 5(1)?

MR MOSES:   Section 5(1) has been amended.  It now reads:

For the purposes of this Act, a person (the discriminator) discriminates against another person (the aggrieved person) on the ground of a disability of the aggrieved person if, because of the disability, the discriminator treats, or proposes to treat, the aggrieved person less favourably than the discriminator would treat a person without the disability in circumstances that are not material different.

I think my learned friend, as part of her submissions in response, has asserted, well, at least on that point the legislation has been amended and there would be no public interest in this issue being resolved, and we do not agree with the submission she has made for reasons which I will elaborate on shortly, but that does not touch upon section 15(2) and what constitutes a detriment for the purposes of a person’s employment. Can I just return, your Honour, to paragraph 78 of the federal magistrate’s judgment which is to be found at page 35 of the application book. The conduct which was alleged against the applicant which ultimately gave rise to a psychologist forming the view that she was suffering from some personality disorder, hence triggering the direction to attend a psychiatric assessment, included the behaviour there set out, that is –

causing malicious gossip, threatening colleagues with disciplinary action, constantly reporting apparent work performance issues to management while not completing her own work, tantrums if challenged and very poor and hostile customer service.

As well as reference to her sexuality.  Probably conduct which some members of the Sydney Bar would be accused of, but nonetheless ‑ ‑ ‑

GUMMOW J:   So what?  Why make that comment?

MR MOSES:   Your Honour, it is relevant to this point.  The circumstances which were relied upon by the respondent in order to trigger the direction to attend a psychiatric assessment, with respect, were not reasons which would have required any other individual to attend a psychiatric assessment.  The only reason why the individual is directed to attend a psychiatric assessment was because a psychologist formed the preliminary view that she suffered from a personality disorder, hence imputing to her a disability and because of that, directing the individual to attend a psychiatric assessment, not because of ‑ ‑ ‑

GUMMOW J:   What is the detriment?  This is issue one.

MR MOSES:   Correct.  Your Honour, the Disability Discrimination Act is, of course, intended to protect the human rights of people with a disability, to protect them against discrimination, including any detriment to their employment, on the ground of disability or imputed disability.  There are now decisions in both the Federal Court and the Federal Magistrates Court which establish that a direction to attend a psychiatric assessment given by an employer and the subsequent dismissal of the employee for refusing to attend such a psychiatric assessment is not a detriment for the purposes of the Disability Discrimination Act. 

Indeed, Justice Graham, sitting as the Full Court in this matter, observed at paragraph 79(j) of his judgment, at pages 95 to 96 of the application book, that it “was nothing other than a normal incident of employment” for an employer to direct an employee to attend such a psychiatric assessment, and the detriment is this, your Honours.  The human rights of personal privacy and dignity are at stake when an employer purports to give such a direction on the basis that they impute to the individual a disability, and the common law, as we know from Marion’s Case, ordinarily protects these interests by requiring the consent of the person to such an examination.  Your Honours, can I ask you to turn to paragraph 12 of our submissions at page 113 of the application book:

Section 15(2)(d) of the DDA provides that it is unlawful for an employer to discriminate against an employee on the ground of the employee’s disability (or imputed disability) by subjecting the employee to any “other detriment”.

One of the fundamental common law rights is the right to personal and bodily integrity, and this was considered by a majority of this Court in Marion’s Case 175 CLR 218 which involved the power of a parent to consent to the sterilisation of an intellectually disabled child. That judgment, of course, is behind tab 5 in the appellant’s bundle of authorities. The relevant passage that I would like to briefly draw to the Court’s attention appears at page 233 at about point 2 of the page where their Honours, referring to that right, quote Sir William Blackstone, who said:

“[T]he law cannot draw the line between different degrees of violence, and therefore totally prohibits ‑ ‑ ‑

GUMMOW J:   There is no violence here, is there?

MR MOSES:   Your Honour, there is, if I can continue at page 234 of the judgment:

The factor necessary to render such treatment lawful when it would other be an assault is, therefore, consent.

It is our submission that the requirement of consent applies equally to psychiatric examinations.  The breadth of the common law principle of personal autonomy, as stated by their Honours and by Sir William Blackstone, reinforces this conclusion.  If the power to give consent is ‑ ‑ ‑

GUMMOW J:   Principle, personal autonomy also has taken another area of law which is employment law, is it not?

MR MOSES:   Yes, your Honour.  If the power to give consent is protected by what we might call the common law right of personal integrity, then the respondent and the courts below relied on two decisions of the Federal Court at first instance to mount an argument and hold that there is a common law principle that overrides it, an implied term in employment contracts that an employer can direct a person to attend a medical or psychiatric examination. 

In Blackadder, which came to this Court on other grounds, the question was whether the respondent employer could direct Mr Blackadder to attend a medical examination. At paragraphs 68 to 69 of the judgment of Justice Madgwick at first instance, which is behind tab 4 of the applicant’s bundle of authorities, reported in 118 FCR 395, set out the basis for his conclusion that an implied term existed in that particular contract of employment, that the employer could “require an employee, on reasonable terms, to attend a medical examination to confirm his” fitness to perform duties in a dangerous work environment.

In this case, of course, there was never any contention by the respondent that the applicant was not fit to perform her duties. Indeed, the court below observed at paragraph 111 of the judgment at first instance, which is to be found at page 50 of the application book at line 20, that there was never any suggestion that the applicant could not perform the inherent requirements of her role and, accordingly, the reason for the direction to undertake the psychiatric assessment was because the employer was informed by psychologist that he was of the view that she suffered from a psychiatric disorder, not because she could not do her job or not because she represented a danger to anybody within the workplace. The trigger here was the imputation of a disability which, of course, the provision, section 15(2), renders it unlawful for a detriment to be imposed on an individual, that is, you must undertake a psychiatric assessment and if you do not, your employment will be terminated.

The other case which is relied upon by Justice Graham sitting as the Full Court is Thompson’s Case 173 IR 395. That also is to be found in the applicant’s bundle of authorities behind tab 12. That is the only case in which the interrelationship of the implied term identified in Blackadder and section 15 of the Disability Discrimination Act has been considered by a court.  That was in the context of an application for an interlocutory injunction sought by the applicant in circumstances where, having had a period of absence from work because of a back injury, was required to attend for a psychiatric assessment.  He sought an injunction restraining the employer from directing him to do so on the basis that there was, firstly, no interconnection between the back injury that he had suffered and the directed psychiatric assessment and, secondly, the inherent requirement of the position that he held was not such that it was necessary for such an assessment to take place.  Of course, in Thompson’s Case there was no dispute that the applicant suffered from a disability in this case ‑ ‑ ‑

GUMMOW J:   How many days did this proceeding go before Federal Magistrate Driver?

MR MOSES:   Your Honour, I will answer that question in a moment, your Honour.

GUMMOW J:   It looks like seven days.

MR MOSES:   I think it went for some time, your Honour.  I did not appear.  I will confirm that, your Honour.  Eight days, your Honour, I am told.  Your Honour, in respect of the position here, of course, the applicant had imputed to her a disability.  She in fact, as it turned out in the matters that were advanced before the federal magistrate, was not suffering from the diagnosis which had been imputed to her.  We submit, of course, that on a proper analysis Thompson’s Case, which Justice Graham relied upon, does not apply to this case either. 

In Thompson, at paragraph 50, his Honour Justice Goldberg noted that the High Court did not disturb Justice Madgwick’s decision that such an implied term existed, but neither can it be said from our reading of the judgment in Blackadder that the High Court endorsed it.  None of the Justices specifically referred to that principle.  The case was decided, of course, on other grounds.  Thompson’s Case concerned section 15(4)(a) of the Disability Discrimination Act which is emphasised at paragraph 52 of his Honour’s judgment.  Thompson’s Case emphasised the fact that the decision was restricted to the application and proper analysis of section 15(4)(a) of the Disability Discrimination Act and that was whether the applicant could carry out the inherent requirements of his position. That was not the case advanced by the respondent here. The present case is about section 15(2)(d) which remains in the statute in its present form.

Your Honours, that leaves us with the judgment of his Honour Justice Graham sitting as the Full Court below, the only Australian judgment that deals directly with this very important question, can Australian employers compel their employees to attend a psychiatric examination because they impute to them a mental disability and proceed to dismiss them if they refuse to comply?

GUMMOW J:   If the direction is reasonable.

MR MOSES:   No, your Honour, if it is lawful and reasonable.  Your Honour, of course ‑ ‑ ‑

GUMMOW J:   It is put against you that the notion of reasonableness is ‑ ‑ ‑

MR MOSES:   Yes, your Honour, and that is the error ‑ ‑ ‑

GUMMOW J:   It is a good idea to let the Judge speak to you.

MR MOSES:   I am sorry, your Honour.  I apologise.

GUMMOW J:   It is put against you that the notion of reasonableness is bound up in the concept of detriment here.  What do you say to that?

MR MOSES:   We say, your Honour, it plays no part in the application of section 15(2) for this reason. An employer may give a lawful and reasonable direction to an employee. What occurred here, of course, was not lawful, it was in contravention of section 15(2) of the Disability Discrimination Act. That was not the issue that was resolved by the court, either at first instance or by the Full Court, that is, the court looked at whether or not the direction was reasonable, but not whether it was lawful. It was not lawful because of section 15(2) of the Act.

GUMMOW J:   The question is whether the reasonableness goes into the lawfulness.  That is what Ms Eastman is putting against you, as I understand it what she is saying.

MR MOSES:   There may be reasonableness in other context, but not this one, where the Disability Discrimination Act protects individuals from a detriment because of a disability.  If I can trouble your Honours to go to Justice Dixon’s judgment in Darlings’ Case which we have referred to in our submissions.  It is to be found behind tab 11 of the bundle of authorities.  If I could just remind the Court of what Justice Dixon said there at the bottom of page 621:

If a command relates to the subject matter of the employment and involves no illegality ‑ ‑ ‑

GUMMOW J:   He was construing the terms in an award, was he not?

MR MOSES:   In that case, yes, your Honour, but ‑ ‑ ‑

GUMMOW J:   The award provided that any “refusal to carry out the reasonable instructions of the employer”, et cetera, was a “breach of the award”.  Is that so?

MR MOSES:   That is correct.  And here the direction of the employer was a breach of the Disability Discrimination Act because it imposed a detriment on the individual for no other reason because the employer thought she had a disability within the meaning of section 4 of the Act.  I apologise, your Honour.  To answer your Honour’s question, a direction may, of course, be reasonable but not lawful if Parliament has determined that that is the position and ‑ ‑ ‑

GUMMOW J:   That is the question.

MR MOSES:   Yes, and the purpose of Parliament cannot be frustrated ‑ ‑ ‑

GUMMOW J:   Why would the Parliament readily be taken to take a dim view of conduct that is not unreasonable in this setting?

MR MOSES:   I think, your Honour, because of this, and that is, because the policy underpinning the Disability Discrimination Act would be utterly undone if employers could engineer the dismissal of employees on the grounds of a personality disorder where it had nothing to do with the performance of their duties and, to use the words of Justice Kirby in Blackadder at paragraph 29 of that judgment, the purpose ‑ ‑ ‑

GUMMOW J:   You have used pejorative expressions, engineer, is there any suggestion of bad faith?

MR MOSES:   In this case, your Honour, the case that was mounted below by the applicant was that there was no basis for the direction that she undertake a psychiatric assessment and that the employer ought to have terminated her ‑ ‑ ‑

GUMMOW J:   The employer is a public body, it is a council.

MR MOSES:   That is right. The employer ought to have, if it took the view she had breached her contract of employment or was unable to perform her functions, terminated her for that purpose and she would be left to her rights rather than imposing upon her a direction which, in effect, violates her personal rights, her refusal leading them to the termination of her employment on that basis. Reasonableness, of course, plays no part in the construction of section 15(2) of the Act. It is to be found in other provisions of the legislation, but not in section 15(2) of the Act, and we respectfully submit that the purpose of a ‑ ‑ ‑

GUMMOW J:   Found in what other provision?

MR MOSES:   Section 6.  But, your Honours, in terms of the question about the statute and its implementation, the purpose of the Parliament, of course, in implementing the Disability Discrimination Act cannot be frustrated or negatived because it conflicts with a common law notion of what constitutes a reasonable direction pursuant to a contract of employment.  It must be reasonable and lawful.  Here it was not lawful, so the issue of reasonableness does not arise in determining whether or not the direction constituted a detriment and the judgment of Justice Graham does not come to grips with that issue, neither does the decision of the federal magistrate and neither does the decision of Justice Goldberg in Thompson, and that is a dangerous precedent, it is respectfully submitted, that is left hanging there in respect of the application of the Disability Discrimination Act. 

The characterisation of the respondent’s actions as reasonable, as I have submitted and we maintain, is irrelevant to the inquiry required by the Act.  As we have said in paragraph 20 of our submissions at page 115 of the application book, the primary judge found that it was reasonable for the respondent to direct the applicant to attend medical examinations of well‑founded concerns about her behaviour and because of her use of sick leave was a concern.  I have taken your Honours at the outset, and I do not labour upon it, to those aspects of her conduct which were emphasised to be of concern at paragraph 78 of the federal magistrate’s judgment at page 35 of the application book.  Neither the primary judge nor the appeal court determined ‑ ‑ ‑

GUMMOW J:   The red light has been on for some time, Mr Moses.

MR MOSES:   I am sorry.  If I just finish this point, your Honour.

GUMMOW J:   Of course.

MR MOSES:   Thank you.  Neither the primary judge nor the appeal court determined whether such a direction was lawful absent the applicant’s consent.  Had the primary judge not found that the respondent’s directions were reasonable, the results in the court would have been different.  On the question of the comparator, we just say this briefly.  The primary judge applied Purvis to determine that the appropriate comparator, which in the case was the applicant herself was a person who exhibited the same behaviour as the applicant, occupied the same position and duties and

demonstrated the same work performance and conduct during the period 2005 to 2006 but who was not imputed with a disability. 

There was no suggestion in the case below by the respondent that any other employee behaving in that same manner referred to in paragraph 78 of the federal magistrate’s judgment, would have been directed to undertake a psychiatric assessment. The only intervening event was a view taken by a psychologist that she was suffering from a mental health disability and that imputation of that, your Honour, lead to the direction to attend the assessment, her refusal then leading to the dismissal of her employment. This case, we respectfully submit, is an appropriate vehicle for the Court to resolve the question of what constitutes a detriment pursuant to section 15(2) of the Act. Thank you, your Honours.

GUMMOW J:   We do not need to call on you, Ms Eastman.

We are not satisfied that the applicant has sufficient prospects of success upon the primary issue of statutory construction which she urges upon this Court to warrant a grant of special leave.  Special leave is refused with costs.

We will adjourn to reconstitute.

AT 2.28 PM THE MATTER WAS CONCLUDED