Paul Graham Woodham v Commonwealth of Australia [1989] ACTSC 25 (1 June 1989)

SUPREME COURT OF THE ACT

PAUL GRAHAM WOODHAM v. COMMONWEALTH OF AUSTRALIA
S.C. No. 211 of 1989
Application for Summary Judgment

COURT

IN THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Kelly J.(1)

CATCHWORDS

Application for Summary Judgment - No new question of principle involved.

Paccar Financial Pty Limited v. Hord and Others (unreported, Kelly J. Supreme Court of the ACT, 20 January 1989)

General Steel Industries Inc. v. Commissioner for Railways (N.S.W.) [1964] HCA 69; (1964) 112 CLR 125

Theseus Exploration N.L. v. Foyster [1972] HCA 41; (1972) 126 CLR 507

Bell v. Lever Brothers Limited [1931] UKHL 2; (1932) AC 161

Chapman v. The Commissioner, Australian Federal Police (1983) 50 ACTR 23

HEARING

CANBERRA
1:6:1989

ORDER

The plaintiff's application for summary judgment made by his summons of 24 April 1989 be refused.

The costs of the summons to date be costs in the cause.

DECISION

This is an application made by the abovenamed plaintiff by summons dated 24 April 1989 for liberty to enter judgment against the defendant, the Commonwealth. The principles governing the question of liberty to enter summary judgment are not in doubt. I dealt with them in Paccar Financial Pty Limited v. Hord and Others in a judgment delivered on 20 January 1989 but not reported. It is convenient to repeat what I said there.
"In Theseus Exploration N.L. v. Foyster (1972)

1126 CLR 507 Barwick C.J. said at pp 513-4:
"The ambit of O.18, r.1 of the Rules of the
Supreme Court, of Queensland (the equivalent
of O.15, r.1) in relation to the present
proceedings is not in doubt. The respondent,
on the appellant's application for summary
judgment was 'bound to shew' that he had
'some reasonable ground of defence to the
action' (Crump v. Cavendish (1880) 5 Ex D
211 at p 214, per Bramwell L.J.) and the
appellant was entitled to summary judgment if
there is 'no fairly arguable point' to be
brought forward (Anglo-Italian Bank v. Wells
(1878) 38 LT 197 at 201, per Jessel M.R.).
The jurisdiction to give summary judgment
should not be exercised 'where a difficult
question of law is raised' - see generally
the Supreme Court Practice (1970) vol. 1,
pp 126-130.
...
Although I have reached a clear conclusion as
to the lack of validity in the respondent's
submission that the appellant was unable to
recover the amount claimed, I would not be
prepared to hold that the judge erred in the
course he took. Equally, however, I would
not have thought him in error if he had
granted the appellant's application for
summary judgment. The case was one which, in
my opinion, could have been disposed of upon
legal argument upon the application. But it
was for the judge to be satisfied that there
was a matter to be tried. Whilst there were
no facts to be decided, it was open to the
judge, in my opinion, to take the view that
the extent and complexity of the matters of
law and of argument thereon warranted a hearing."
At p 514-5 Gibbs J said,
"... I am of opinion that the learned primary
judge was completely justified in dismissing
the appellant's application for summary
judgment. Indeed, on one view of the law as
stated in Bundock Bros. v. Bergl and Co.
(1897) 8 QLJ 106, he was bound to dismiss
it. In that case Griffith C.J., speaking for
the Full Court of the Supreme Court of
Queensland in a case arising under an earlier
rule corresponding to O.18 of the Rules of
the Supreme Court (Q) said (at p 108):
'It is settled that when there is a serious
point of law raised by a defendant, the Judge
in Chambers ought not to decide it, but ought
to give unconditional leave to defend.'"
In Fancourt v. Mercantile Credits Limited
[1983] HCA 25; (1983) 48 ALR 1 at p 10, the High Court said:-
"The power to order summary or final judgment
is one that should be exercised with great
care and should never be exercised unless it
is clear that there is no real question to be
tried: see Clark v. Union Bank of Australia
Ltd [1917] HCA 19; (1917) 23 CLR 5; Jones v. Stone (1894)
AC 122; Jacobs v. Booth's Distillery Co
(1901) 85 LT 262."
In The Cloverdell Lumber Company Pty Ltd v.
Abbott [1924] HCA 4; (1924) 34 CLR 122, Isaacs J said,
at p 133:-
"All the defendant has to do is to establish
a state of facts that displaces the prima
facie effect of the statement of the mere
belief of the deponent ... that there is no
defence in fact or law."
Later, again at p 133, he referred to the
judgment of Brett L.J. (as he then was) in
Ray v. Barker (1879) 4 Ex D 279 where, at
p 283, his Lordship said:-
"In this case we have to consider what is the
true construction of Order XIV. When the
existence of the debt has been clearly
established upon the affidavits, the
plaintiff is entitled to an order empowering
him to sign judgment. The defendant,
however, is to have leave to defend, either
if he has a good defence upon the merits, or
if he discloses 'such facts as may be deemed
sufficient to entitle him to defend'. If
therefore the defendant shows such a state of
facts as leads to the inference that at the
trial of the action he may be able to
establish a defence to the plaintiff's claim,
he ought not to be debarred of all power to
defeat the demand made upon him: by the very
words of the Order the plaintiff is not to be
allowed to sign judgment merely because the
defendant's affidavit does not show a
complete defence."
Isaacs J. also referred to the judgment of
Cotton L.J. who, in the same case, said, at
p 284:-
"The affidavit may not make it clear that
there is a defence, but the defendant may be
able at the trial to establish a bona fide
defence. I am not satisfied that in the
present case a valid defence exists; but the
defendant may plausibly argue that he has a
good defence."
Detailed and exhaustive evidence is not
required: Argento v. Cooba Developments Pty
Ltd (1987) 53 FCR 579 at p 584 per Fisher J.

2. To that statement I would add a comment made by Barwick C.J. in General Steel Industries Inc. v. Commissioner for Railways (N.S.W.) [1964] HCA 69; (1964) 112 CLR 125. The learned Chief Justice was dealing with an application that a statement of claim be struck out but what he said seems to me to be applicable to a case where an application by a plaintiff for summary judgment is resisted by a defendant. At p 130, his Honour said,

"In my opinion great care must be exercised
to ensure that under the guise of achieving
expeditious finality a plaintiff is not
improperly deprived of his opportuntity for P+N
the trial of his case by the appointed
tribunal. On the other hand, I do not think
that the exercise of the jurisdiction should
be reserved for those cases where argument is
unnecessary to evoke the futility of the
plaintiff's claim. Argument,perhaps even of
an extensive kind, may be necessary to
demonstrate that the case for the plaintif is
so clearly untenable that it cannot possibly
succeed."

It may be noted that, in giving my reasons in Paccar Financial Pty Limited v. Hord and Others, I omitted a short passage from the judgment of Barwick C.J. in Theseus Exploration N.L. v. Foyster (supra) at p 514 which read:

"Perhaps the summary intervention to prevent
the continuance of a plaintiff's action ought
to be much rarer than the giving of summary
judgment but there is sufficient correspondence
in the two situations to make apposite
to this case much of what I said in General
Steel Industries Inc. v. Commissioner for
Railways (N.S.W.) (1964) 114 CLR 125, at pp 129-130."

It may be noted that in that action, although the judge at first instance had refused to give summary judgment, the High Court dealt finally with the matter. The headnote says in part at p 508:

"Full argument upon the legal matters in
dispute between the parties was heard before
the High Court and there were no disputed
questions of fact.
Held, that, the High Court having determined
all matters in dispute between the parties,
the proper course was to allow the appeal and
order that judgment be entered for the
plaintiff, even though the primary judge may
not have erred in refusing leave to enter
summary judgment."

The judgment of the High Court followed the granting of special leave to appeal.

3. By his statement of claim the plaintiff alleged that at all material times he was an officer employed by the defendant pursuant to the Public Service Act 1922 (Commonwealth) (the Act) in the Department of Administrative Services. He alleged further that by documents dated 14 February 1989, 23 February 1989 and 1 March 1989 and a conversation, which took place on 1 March 1989, between the plaintiff and his supervisor, the Assistant General Manager, Purchasing Co-ordination, the defendant offered to pay him the sum of $85,055.07 (sic) plus his selection of one of four alternatives on condition that he retire from his employment on or before 14 March 1989, his last day of work being 31 March 1989.

4. He further alleged that on 1 March 1989 he accepted the offer in writing and thereby retired.

5. He alleged further and in the alternative that on 14 February 1989 the defendant by its servants and agents determined that the plaintiff would thereby be retrenched from his employment should he consent in writing and that on 1 March 1989 he did so consent. He then alleged that consequent upon his retrenchment he was entitled to be paid the sum of $85,066.07. He gave particulars as to how that amount was made up and then alleged that consequent upon his retrenchment he was entitled to be paid, pursuant to the Superannuation Act 1976 (Commonwealth), his selection of one of the four alternatives previously referred to. He further alleged that on 31 March 1989 he left the employment of the defendant.

6. He alleged further that on 11 April 1989 he selected the payment of the third of those options, a lump sum payment of $212,013.00, and notified his selection to the defendant and to the Commissioner for Superannuation. He next alleged that the defendant by its servant or agent, Mr Ross Pitt, the General Manager, Department of Administrative Services, indicated on 30 March 1989 that it would not pay the plaintiff the sum promised or any part of it and that despite demand the defendant has not paid the sum claimed or any part of it.

7. His precise claim is framed as follows:

The sum of $297,079.07 (or such other
remedies as are appropriate depending on the
plaintiff's superannuation selection) and
interest pursuant to s.53A of the Supreme Court
Act of the Australian Capital Territory 1933.

8. The Writ was issued on 13 April 1989 and served the same day. An appearance was entered on 20 April 1989 whereupon the plaintiff moved promptly as is apparent from the date of the notice of motion. The plaintiff's affidavit in support of the summons was sworn on 26 April 1989. One dated 24 April 1989 had been filed but the plaintiff did not rely on that, apparently because there was some minor errors in it.

9. The plaintiff deposed that he had been an officer of the Commonwealth Public Service since 1957, being employed from 1985 as an Administrative Services Officer Class 8 in the Department. He annexed to his affidavit a copy of the letter dated 14 February to which he referred in his statement of claim. The letter read in part:-

"The Scheme has been developed not as a substitute
for existing provisions designed to
cater for staff who are considered to be
excess, inefficient or medically unfit, but
to provide an option for other staff who do
not readily fall within the scope of these
provisions where there could be mutual
benefit in facilitating a voluntary retirement:
for the Department in adjusting any
imbalances in its staffing profiles, and for
staff concerned in securing an attractive
retirement 'package'.
While the Scheme is management initiated in
the sense that management has determined to
whom offers of a retirement 'package' will be
made, it is entirely voluntary insofar as
staff are completely free to decide whether
or not to accept it.
The Scheme is available for a limited period
only - the Public Service Commissioner has
advised that all retirements under the Scheme
are to be finalised no later than the end of
March 1989.
Although discrete in nature, the Scheme
offers to those who accept voluntary retirement
the same benefits as those applicable to
staff voluntarily retrenched under the
Australian Public Service Redundancy Award
1987. An outline of the benefits provided by
the Scheme is enclosed for your information.
I should add that despite speculation in the
press to the contrary, the Commissioner for
Taxation has determined that the Scheme is
one to which concessional taxation provisions
will apply.
Against the above background, this letter
invites you to consider a formal offer of
retirement under the conditions of the Early
Retirement Scheme. As I have already outlined,
the offer is completely voluntary;
however its terms are not negotiable, and if
you accept the offer you will retire no later
than the end of March 1989. If you do wish
to accept the offer, you should complete and
return the enclosed pro forma A; otherwise
you should complete and return pro forma B.
Your failure to return either form by 14
March 1989 without prior agreement will be
taken as rejection of the offer. Pro formae
should be returned when completed to the
General Manager, Corporate Services Group,
to the address shown on the forms by no later
than 15 March 1989. Envelopes should be
marked 'Personal and In-Confidence'.
If you accept the offer, we would anticipate
your last working day being Friday, 17 March
1989. Should you wish to retire earlier than
this date, the concurrence of both the
Department and the union covering your
designation is required under the Award. In
special cases the Department would be willing
to negotiate a later date up to 31 March. In
either case you should discuss the matter
with one of the officers listed below."

Enclosed with the letter were two documents headed respectively:

"Preservation of Superannuation Entitlement
Examples of Deferred Benefits Options"

and

"Superannuation Act 1976
Continuity as an Eligible Employee - Changes in
Employment Not Breaking Superannuation Continuity
(Sub-section 3(3) of the Act)"

The plaintiff also annexed to his affidavit a copy of a letter dated 23 February 1989 from the Australian Government Retirement Benefits Office which set out under the heading

"Options Available on Involuntary Retirement
(Retrenchment)"

the alternatives which were referred to in the statement of claim and a copy of a letter dated 1 March 1989 which the Department sent him. It set out particulars of the payment which allegedly go to make up the lump sum of $85,066.07 referred to in the statement of claim. The figures shown in that letter are those set out in the particulars of entitlement referred to in paragraph 6 of the statement of claim but one figure, that expressed to be for payment in lieu of long service leave, is shown as $4,141.25 less than the amount claimed to be due. No explanation was offered by either side for the discrepancy and it passed unnoticed during the course of the hearing of the summons.

10. As appears from annexure "C" to his affidavit, the plaintiff accepted the voluntary retirement offered him by signing the appropriate pro forma identified as "A" with an elision to take account of the fact that the Assistant General Manager referred to in paragraph 2 of the statement of claim had asked him to stay on until 31 March 1989.

11. Mr Pitt, to whom reference is made in the statement of claim, deposed that as from 3 January 1989 he was responsible, on behalf of the defendant, for handling matters relating to the retirement of non-Senior Executive Service officers in the Purchasing and Sales Group of the Department of Administrative Services.

12. On 22 March 1989 he had a meeting with two detective sergeants of the Australian Federal Police and an officer of the Office of the Director of Public Prosecutions. They drew his attention to documents in their possession which led him to conclude that there was evidence that the plaintiff might have failed to fulfil his duty as an officer in connection with the disposal by the defendant of certain aircraft and spare parts for them. At the meeting a request was made to the officers of the Australian Federal Police to provide a brief of evidence for consideration by the Director of Public Prosecutions in connection with the possible commission by the plaintiff of criminal offences arising out of his involvement in the disposal of the aircraft and spares.

13. On 30 March 1989 Mr Pitt was informed by the Deputy Secretary of the Department that he had requested an authorized officer to consider whether misconduct of the plaintiff within the meaning of ss.55 and 56 of the Public Service Act might have occurred and whether charges should be laid under the Act. On the same day the Deputy Secretary advised him that the Secretary had approved the suspension of action to give effect to the plaintiff's planned retirement on 31 March 1989 pending further advice as to the outcome of the disciplinary process and of the consideration by the Director of Public Prosecutions of the brief of evidence which was being prepared. On 31 March 1989 the authorized officer told Mr Pitt that he had suspended his consideration of whether the plaintiff had been involved in misconduct pending the consideration of laying of criminal charges against him by the Australian Federal Police. On 1 May 1989 one of the detective sergeants told him that the investigations by the Australian Federal Police had not been concluded. Mr Pitt was also told, and it is common ground, that no notice of retirement under s.76W of the Act had been given the plaintiff.

14. By letter dated 11 April 1989 the plaintiff gave notice to the defendant that he selected option 3 of those set out in the defendant's communication of 23 February 1989.

15. Following a letter of demand written by the plaintiff's solicitors the Australian Government Solicitor said in a letter dated 12 April 1989 addressed to those solicitors:

"The Early Retirement Scheme which was under
consideration in Mr Woodham's case was ultimately
dependent on the Secretary to the Department of
Administrative Services or his delegate signing
and giving a notice of retirement under section
76W of the Public Service Act. This result
follows from the application of the provisions of
sub-clause 7(d) of the Australian Public Service
Redeployment and Retirement (Redundancy) Award
1987, a copy of which I attach for your information.
In this case the Delegate decided not to give a
notice under section 76W to Mr Woodham. This was
done because independent investigations by the
Australian Federal Police, which are continuing,
suggest serious shortcomings in the arrangements
for the disposal of certain aircraft and
associated spare parts. On the face of it, those
shortcomings may warrant the institution of
disciplinary proceedings and for this reason it
was felt inappropriate, while those investigations
are continuing, to confer the benefits available
under the current scheme on Mr Woodham at this stage.
The result is that your client has not at this
stage retired from the Australian Public Service
and remains an officer. As he was not prevented
from commencing employment, after ceasing work in
the Department on 31 March, 1989, he should now
apply for leave without pay and for permission to
engage in that employment. My instructions are
that such an application would receive favourable
consideration and would be received by the
Department on a "without prejudice" basis should
you so desire.
In the event that Mr Woodham does not seek leave
without pay, I advise that the Secretary will
consider exercising the powers available to him
under section 66A of the Public Service Act
leading to his retirement by force of that section
or, as it is described, by forfeiture of office.
In the circumstances the Secretary is prepared to
wait until 21 April, 1989 before he further
considers exercising those powers.
The Department is anxious to ensure that
Mr Woodham's position in relation to the AFP
investigation is resolved as soon as possible.
Should Mr Woodham be exonerated, the Department
would be prepared to continue the process of early
retirement."
Section 76W of the Act is as follows:
"Powers of Secretary and Board
76W.(1) Where the relevant Secretary is satisfied
of a relevant matter in relation to an
officer, the relevant Secretary may, having con-
sidered whether it would be in the interests of
the efficient administration of the Secretary's
Department to transfer the officer under section
50, subject to sub-section (2), by notice in
writing given to the officer, reduce the
officer's classification or retire the officer
from the Service.
(2) Where -
(a) a Secretary -
(i) has been unable to find alternative
suitable employment for an excess
officer in the Secretary's Department; and
(ii)proposes to exercise the power under
sub-section (1) in relation to the
officer; and
(b) the officer has not consented to the
exercise of that power,
the Board shall take such action as is reasonable
to find alternative suitable employment for the
officer in the Service, and the Secretary shall
not exercise the power under sub-section (1) in
relation to the officer unless the Board is
satisfied that it would not be in the interests
of the efficient administration of the Service to
transfer the officer under section 51 to another
Department.
(3) Where the Board is -
(a) satisfied of a relevant matter in rel-
ation to an officer; and
(b) satisfied that it would be in the
interests of the efficient administration
of the Service to do so,
the Board may, having considered whether it would
be in the interests of the efficient
administration of the Service to transfer the
officer under section 51, by notice in writing
given to the officer, reduce the officer's
classification.
(4) The powers conferred on a Secretary or
the Board by this section are subject to any
applicable industrial award.
(5) A notice given to an officer under this
section takes effect as provided by the regulations.
(6) In this section, 'relevant matter', in
relation to an officer, means any of the following
matters:
(a) that an officer is unable to perform his
or her duties, or other duties
appropriate to the officer's classification,
because of physical or mental incapacity;
(b) that an officer is inefficient;
(c) that an officer is not qualified to perform
his or her duties;
(d) that an officer is an excess officer."

16. It is to be noted that there is no suggestion that the relevant Secretary was satisfied of a relevant matter within the meaning of that phrase as defined by s.76W in relation to the plaintiff. Indeed the first two paragraphs quoted above of the letter from the Department of Administrative Services to the plaintiff dated 14 February 1989 make this plain.

17. Clause 7(d) of the Australian Public Service Redeployment and Retirement (Redundancy) Award 1987 (the Award) provides that:

"Subject to subclause (e), where the Secretary
aproves an election to be retired and gives
notice of retirement under section 76W of the
Act, the period of notice shall be 28 days."
Sub-clause (e) says that:
"Where the Secretary so directs or the officer so
requests, the officer shall be retired at any
time within the period of notice under subclause
(d) and the officer shall thereupon be entitled
to receive payment in lieu of salary for the
unexpired portion of the period."

18. In essence the defendant resists the plaintiff's claim on two bases. The first is that no notice has been given the plaintiff under s.76W of the Act and that because of the provisions of sub-clause 7(d) of the Award a condition precedent to the payment of the monies claimed by the plaintiff had not been complied with.

19. The second is that because of the possible misconduct of the plaintiff, the defendant is entitled to defend the action. The consequences of that alleged misconduct were not spelled out but I assume readily enough that the defendant's contention is that if misconduct be proved it will be entitled to dismiss the plaintiff, who would not, upon such dismissal, be entitled to anything like the benefits which the agreement referred to in the statement of claim provides for. A well known case, Bell v. Lever Brothers Limited [1931] UKHL 2; (1932) AC 161, comes readily to mind.

20. If the first of the two bases were the only one upon which the defendant relies in resisting the application for summary judgment, I would be very much inclined to grant the application. It seems to me that the notice in writing referred to in sub-s.1 of that section can only operate in respect of retirement brought about as a result of what are described in the section as "relevant matters". Such relevant matters are specifically said to be inapplicable so far as the plaintiff is concerned. It follows, therefore, I think that sub-clause 7(d) of the Award is not applicable to the arrangement made between the plaintiff and the defendant. That is not to say that the award does not have some part to play in the contract between the plaintiff and the defendant because, as is said in the letter of 14 February 1989, the Early Retirement Scheme referred to in that letter offers to those who accept voluntary retirement the same benefits as those applicable to those voluntarily retrenched under the Award. But nothing in that letter or in the Award can be said, I think, to require that notice under s.76W be given the plaintiff. It follows that it is unnecessary to consider cases such as Chapman v. The Commissioner, Australian Federal Police (1983) 50 ACTR 23.

21. However, I think that the defendant has put sufficient material before the Court to warrant the refusal of the application on the basis that it is entitled to allege that sort of misconduct on the part of the plaintiff which would have allowed it to dismiss the plaintiff with his entitlement to benefits much reduced from those agreed to by the contract upon which the plaintiff sues.

22. The defendant may be entitled to defend the action, but it seems to me that it would be in the highest degree unjust that it should do so after taking as much time as it chooses to decide whether it should make allegations against the plaintiff of the kind which would warrant its refusal to pay the whole sum agreed.

23. The plaintiff has furnished all the particulars which the defendant sought. Mr. Pitt stated in his affidavit that it was the defendant's intention to file a defence to the statement of claim when a letter written by the Australian Government Solicitor requesting further and better particulars should have been answered. That letter has been answered and I see no reason why a defence should not be filed promptly. The defendant has now had two months to consider its position and according to the plaintiff's solicitors' letter of demand of 31 March 1989 the matter had already been investigated by the Australian Federal Police, who had two lengthy interviews with him in 1987. If that be the case, it is a little startling that in 1989 the possibility of his being charged with a criminal offence should be raised as a defence to a claim under a contract of retirement which could hardly have been entered into without some knowledge of what had gone before.

24. I refuse at this stage the plaintiff's application for summary judgment made by his summons of 24 April 1989.

25. I will hear argument as to appropriate directions.

26. I order that the costs of the summons to date be costs in the cause.