Patty v Commonwealth Bank [2002] FCA 111 (19 February 2002)

Last Updated: 20 February 2002

FEDERAL COURT OF AUSTRALIA

Patty v Commonwealth Bank [2002] FCA 111

DEAN PATTY -v- COMMONWEALTH BANK OF AUSTRALIA (ACN 123 123 124)

VI 2542 of 1996

RYAN J

19 FEBRUARY 2002

MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	VI 2542 of 1996

BETWEEN:	DEAN PATTY Applicant
AND:	COMMONWEALTH BANK OF AUSTRALIA (ACN 123 123 124) Respondent
JUDGE:	RYAN J
DATE OF ORDER:	19 FEBRUARY 2002
WHERE MADE:	MELBOURNE

THE COURT ORDERS:

1. THAT the application be dismissed.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA and IN THE INDUSTRIAL RELATIONS COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	VI 2542 of 1996

BETWEEN:	DEAN PATTY Applicant
AND:	COMMONWEALTH BANK OF AUSTRALIA (ACN 123 123 124) Respondent

JUDGE:	RYAN J
DATE:	19 FEBRUARY 2002
PLACE:	MELBOURNE

SUPPLEMENTARY REASONS FOR JUDGMENT

1 On 4 August 2000, I published reasons for judgment in the Federal Court of Australia ("the earlier reasons") indicating why, if that Court had jurisdiction to entertain the motion for review of the order of Ryan JR of 19 February 1998 an order should be made in that Court setting aside the order of the learned Judicial Registrar. The present reasons for judgment should be read in conjunction with the earlier reasons and an expression or acronym used herein will have the same meaning as in the earlier reasons. For the reasons explained under the heading "Jurisdiction" in the earlier reasons, I concluded that the Federal Court had no jurisdiction to entertain the motion which, had it been instituted in IRCA, would have been judiciable by that Court. In the same part of the earlier reasons I indicated a course which I consider to be open to me as a Judge of IRCA as well as of the Federal Court. Consistently with that indication, the concluding paragraph [99] of the earlier reasons recited;

"I shall adjourn the proceedings in this Court to a date to be fixed to enable the parties and their legal advisers to consider these reasons. On the adjourned date, subject to any further submissions which may be made by Counsel for either party, I shall, for the reasons explained in para 12 above, make an order as a Judge of IRCA that the proceedings instituted in the Federal Court on 12 March 1998 be treated for all purposes as having been instituted in IRCA. In the same capacity, I shall order that all of the evidence adduced and submissions made in those proceedings be treated as having been adduced and made in IRCA. For the reasons given above in discussing the merits of the application for review, the order of the Judicial Registrar of 19 February 1998 will be set aside and in lieu thereof there will be a declaration in IRCA that the Bank has contravened s 170DE(1) of the Act by terminating the employment of the applicant without a valid reason, or valid reasons for doing so. I shall then forthwith receive such submissions and evidence (if any) as the parties consider appropriate on the question of whether any, and if so which, of the consequential orders contemplated by s 170EE of the Act should be made. The application to the Federal Court will, if the course just outlined is followed, be formally dismissed on the date to which this matter is adjourned."

Jurisdiction

2 The adjourned hearing occurred on 1 February 2001 when Mr Dennis of Counsel for the Bank contended that the application for review of the Judicial Registrar's decision should have been made to IRCA. Because it was not so made but was mistakenly made to the Federal Court, there were no extant proceedings in IRCA, Mr Dennis contended, in which substantive orders could be made. Accordingly, he submitted, s 419 of the Workplace Relations Act 1996 did not empower IRCA to treat evidence adduced, and rulings and interlocutory orders made, in the Federal Court as having been adduced and made in IRCA. Reference was made in support of this submission to the joint judgment of Wilson and Dawson JJ in Jackson v Sterling Industries Ltd [1987] HCA 23; (1987) 162 CLR 612, where it was observed, at 619;

"However, the declaration of the Federal Court as a superior court is to be given effect as far as it can be and, as Aickin J remarked in Philip Morris Inc v Adam P Brown Male Fashions Pty Ltd [(1981) 148 CLR, at p 535], the vesting of judicial power in the specific matters permitted by the Constitution (see ss 75, 76, 77) carries with it such implied power as is necessarily inherent in the nature of the judicial power itself. Having regard to the declaration of the Federal Court as a superior court and a court of law and equity, the implied power should be construed as being no less in relation to the jurisdiction vested in it than the inherent power of a court of unlimited, or general, jurisdiction.

Be that as it may, it cannot be suggested that either the power to grant relief under s 23 or an implied power to prevent an abuse of process extends to the creation and enforcement of rights in addition to those for the protection or enforcement of which the jurisdiction of the Court is invoked. The power given by s 23 is expressly limited to the making of orders in relation to matters in which the Court has jurisdiction and it does not extend the jurisdiction of the Federal Court. Nor could that Court's implied power be employed to create and enforce new rights. Whilst the implied power carries with it all that is necessary for the proper functioning of that Court, it does not extend its jurisdiction beyond that which is vested in it."

3 IRCA was, and is, within the limits imposed by statute on it its jurisdiction, also a superior court and a court of law and equity; (see s 361(2) of the Industrial Relations Act 1988). Like those of the Federal Court, its powers to make orders are exercisable in relation to any matter within its jurisdiction. However, the existence of the matter does not depend on an initiating party's having filed an appropriate document in the Registry of the Court. A "matter" in the relevant sense is "a judiciable controversy, identifiable independently of the proceedings which are brought for its determination;" Fencott v Muller [1983] HCA 12; (1983) 152 CLR 570 at 603, applying In re Judiciary and Navigation Acts [1921] HCA 20; (1921) 29 CLR 257, Felton v Mulligan [1971] HCA 39; (1971) 124 CLR 367 and Philip Morris Inc v Adam P Brown Male Fashions Pty Ltd [1981] HCA 7; (1981) 148 CLR 457. In the present case, I consider that such a controversy arose, at the latest, when the applicant indicated dissatisfaction with the Judicial Registrar's order and the Bank expressly or impliedly evinced an intention to retain the benefit of that order. The coming into existence of the controversy in that way may have coincided with the filing in the Federal Court of an application for review of the Judicial Registrar's order but it was independent of the mistaken initiation of that proceeding.

4 Accordingly, I have not been persuaded to resile from the conclusion reached at [12] of the earlier reasons, where I observed;

"The High Court in Jackson has indicated the limits of powers conferred on the Federal Court in terms similar to those conferred on IRCA by s 419. Those limits do not, I consider, preclude IRCA in the circumstances of the present case, from directing that evidence adduced and submissions made, mistakenly, as it now appears, in the Federal Court, be treated as having been adduced and made in IRCA. I do not think it is an impermissible exercise of the powers reposed in IRCA by ss 419 and 481 to make such an order to rectify the mistake to which I have just referred, and to ensure that the right or matter arising on the institution of proceedings for review of the decision of the Judicial Registrar is determined by the Court having jurisdiction to entertain it."

5 I therefore affirm my view that orders should be made in IRCA setting aside the order of the Judicial Registrar of 19 February 1998 and declaring that the Bank has contravened s 170DE(1) of the Act by terminating the employment of the applicant without a valid reason for doing so. It remains to consider the remedy (if any) which the applicant should be accorded in consequence of that declaration.

Is reinstatement practicable and appropriate?

6 Sub-sections 170EE(1) and (2) of the Act provided;

"(1) In respect of a contravention of a provision of this Division (other than section 170DB or 170DD) constituted by the termination of employment of an employee, the Court may, if the Court considers it appropriate in all the circumstances of the case, make the following orders:

(a) an order requiring the employer to reinstate the employee by:

(i) reappointing the employee to the position in which the employee was employed immediately before the termination; or

(ii) appointing the employee to another position on terms and conditions no less favourable than those on which the employee was employed immediately before the termination; and

(b) if the Court makes an order under paragraph (a):

(i) any order that it thinks necessary to maintain the continuity of the employee's employment; and

(ii) an order requiring the employer to pay to the employee the remuneration lost by the employee because of the termination.

(2) If the Court thinks, in respect of a contravention of a provision of this Division (other than section 170DB or 170DD) constituted by the termination of employment of an employee, that the reinstatement of the employee is impracticable, the Court may, if the Court considers it appropriate in all the circumstances of the case, make an order requiring the employer to pay to the employee compensation of such amount as the Court thinks appropriate."

7 There is a considerable body of judicial exegesis in respect of the words "impracticable" and "appropriate" in those sub-sections. In Patterson v Newcrest Mining Ltd (1996) 68 IR 419, Wilcox CJ said, at 420-421;

"The word "impracticable" has caused difficulty in relation to unlawful termination claims. It appears in subs (2) and has led judges of the Court, including myself, to describe the scheme of s 1709EE as one providing a primary remedy of reinstatement and a secondary remedy of compensation where reinstatement is impracticable. These comments must be read in the light of the amendments, where they apply, requiring the Court to reach a determination that it is "appropriate in all the circumstances of the case" to order reinstatement. Contrary to the submission put by counsel for the appellant, it is my opinion that the matter of appropriateness, where that concept applies, is not restricted to the form of a reinstatement but applies to the initial question whether reinstatement shall be ordered or not.

... ... ...

I am content to adhere to what I said in Nicolson v Heaven and Earth Gallery Pty Ltd (1994) 57 IR 50 at 60. I do not think that what I there said is inconsistent with what Keely J and I said in Liddell v Lembke (1994) 56 IR 447 at 465. The requirement to consider the impracticability of reinstatement necessarily requires the Court to have regard to all the relevant circumstances of the case relating to the employer and the employee; as I said in Nicolson, to evaluate the practicability of a reinstatement order in a commonsense way."

8 In Liddell v Lembke (1994) 56 IR 447, Wilcox CJ and Keely J observed, at 465;

"It is true that s.170EE uses the word "may", not "shall", and that "may" connotes the conferral of a discretion, not a duty: see s.33(2A) of the Acts Interpretation Act 1901. However, as the Industrial Relations Act does not specify any criteria for the exercise of that discretion, they are those emerging from "the subject matter and the scope and purpose" of the legislation: see The Queen v Australian Broadcasting Tribunal; Ex parte 2HD Pty Limited [1979] HCA 62; (1979) 144 CLR 45 at 49. The subject matter of this legislation is unlawful termination of employment. Its scope and purpose is the provision of legally enforceable remedies for people whose employment is terminated in breach of the internationally-accepted standards introduced by the Act into Australian domestic law. Because of these considerations, and the fact that the Commonwealth Act makes a termination in violation of the requirements of s.170DC unlawful in itself, whatever the employee's merits or lack of them, it would not be right to withhold a remedy for a breach of s.170DC because of considerations listed in s.170DE(1). They are factors that permit an employer acting fairly to terminate an employee's employment. Still less would it be correct for the Court to exercise its discretion adversely to an applicant because of factors extraneous to the Industrial Relations Act, such as a respondent's financial position or personal likes or dislikes."

9 In opposition to an order for reinstatement, evidence was adduced on behalf of the Bank from its Senior Manager, Human Resources, for Victoria and Tasmania, Mr Wade. He testified to the self-obvious fact that banking requires of those who participate in it very high standards of integrity and honesty. He indicated that the Bank had lost confidence in the applicant's ability to attain and adhere to those standards. As explained in the earlier reasons, I have found that the allegations of implication in the theft from the ATM which could be regarded as the primary foundation for the Bank's loss of confidence in the applicant, have not been made out. However, Mr Wade pointed to the applicant's allegedly untruthful contention that he had provided Ms Clare and Mr Forkgen with Ms Blencowe's pay envelopes from Franklins and to his refusal to furnish a response to the Bank's request of 24 June 1996 as separately founding the Bank's loss of confidence in the applicant.

10 Mr Wade also testified that the applicant's previous position no longer exists and that the duties and responsibilities of positions broadly equivalent to it have changed dramatically in the period since the applicant's dismissal. He acknowledged that there are recurring vacancies in those equivalent positions and conceded that, with some bridging training, the applicant could fill one of those vacancies. However, he reiterated that the scope for appointing the applicant to any such vacancy was severely restricted by the Bank's reluctance to allow the applicant access to cash or clients' accounts. Continuous direct supervision of the applicant, he pointed out, was not practicable.

11 In my view, the circumstances of this case attract the application of the principles enunciated by a Full Court of IRCA in Perkins v Grace Worldwide (Aust) Pty Ltd (1997) 72 IR 186, where it was observed, at 191;

"Trust and confidence is a necessary ingredient in any employment relationship. That is why the law imports into employment contracts an implied promise by the employer not to damage or destroy the relationship of trust and confidence between the parties, without reasonable cause: see Burazin v Blacktown City Guardian Pty Limited (Wilcox CJ, von Doussa and Marshall JJ, [(1997) 142 ALR 144]. The implication is not confined to employers, it extends to employees: see for example Blyth Chemicals Ltd v Bushell [1933] HCA 8; (1933) 49 CLR 66 at 81-2 and North v Television Corporation Ltd (1976) 11 ALR 599 at 609. So we accept that the question whether there has been a loss of trust and confidence is a relevant consideration in determining whether reinstatement is impracticable, provided that such loss of trust and confidence is soundly and rationally based.

At the same time, it must be recognised that, where an employer, or a senior officer of an employer, accuses an employee of wrongdoing justifying the summary termination of the employee's employment, the accuser will often be reluctant to shift from the view that such wrongdoing has occurred, irrespective of the Court's finding on that question in the resolution of an application under Division 3 of Part VIA of the Act.

If the Court were to adopt a general attitude that such a reluctance destroyed the relationship of trust and confidence between employer and employee, and so made reinstatement impracticable, an employee who was terminated after an accusation of wrongdoing but later succeeded in an application under the Division would be denied access to the primary remedy provided by the legislation. Compensation, which is subject to a statutory limit, would be the only available remedy. Consequently, it is important that the Court carefully scrutinise any claim by an employer that reinstatement is impracticable because of a loss of confidence in the employee.

Each case must be decided on its own merits. There may be cases where any ripple on the surface of the employment relationship will destroy its viability. For example the life of the employer, or some other person or persons, might depend on the reliability of the terminated employee, and the employer has a reasonable doubt about that reliability. There may be a case where there is a question about the discretion of an employee who is required to handle highly confidential information. But those are relatively uncommon situations. In most cases, the employment relationship is capable of withstanding some friction and doubts. Trust and confidence are concepts of degree. It is rare for any human being to have total trust in another. What is important in the employment relationship is that there be sufficient trust to make the relationship viable and productive. Whether that standard is reached in any particular case must depend upon the circumstances of the particular case. And in assessing that question, it is appropriate to consider the rationality of any attitude taken by a party.

It may be difficult or embarrassing for an employer to be required to re-employ a person the employer believed to have been guilty of wrongdoing. The requirement may cause inconvenience to the employer. But if there is such a requirement, it will be because the employee's employment was earlier terminated without a valid reason or without extending procedural fairness to the employee. The problems will be of the employer's own making. If the employer is of even average fair-mindedness, they are likely to prove short-lived. Problems such as this do not necessarily indicate such a loss of confidence as to make the restoration of the employment relationship impracticable."

12 In respect of the Bank's reliance on the applicant's allegedly untruthful assertions that he had furnished Ms Blencowe's pay envelopes to Ms Clare and Mr Forkgen on 13 June 1996, it is to be remembered that in [81] of the previous reasons, I indicated an inability to resolve that issue one way or the other. As well, it was implied that, even if its version were accepted, it would still have been incumbent on the Bank to have made its own investigations into whether the suggestion that Ms Blencowe's wages had been the source of the payment of $250 into the applicant's account on 29 April.

13 Insofar as the Bank relied, as destructive of the requisite relation of trust and confidence, on the applicant's refusal to respond to its request of 24 June 1996 for information to resolve its concerns about his possible implication in the theft, I refer to what I said at [97] of the previous reasons. I there observed;

"The reasonableness of that refusal has to be assessed in the light of the level of co-operation which the applicant had previously extended to the Bank's investigators, the readiness with which he had responded to those earlier requests for information and the terms in which the request of 24 June was cast. In my view, it is understandable, in all the circumstances, that the applicant acted on the advice, which I infer he received from his then solicitors, to answer no further questions. The Bank's letter to the applicant of 24 June was prefaced with an intimation that a decision had been made to conclude the Bank's own investigation, finalise the investigator's findings and recommendations, and return the file to investigating police at the Fitzroy CIB. When those prefatory remarks are read in conjunction with the accusatory tone of many of the subsequent paragraphs which imply that the applicant's earlier responses had been inconsistent or unsatisfactory, the questions as a whole in the letter of 24 June cannot be regarded as reasonable or fair. Some propositions which were said to indicate specific inconsistencies like that to the effect that no call had been made to Mr Patty's home by the VRU or help desk on the morning of 11 February were, I have found, almost certainly wrong. Other specific parts of the request taxed the applicant with having made responses the "relevance of which was doubted by the Bank". Understandably therefore, Counsel for the Bank conceded on the hearing of the review (transcript p 670) that "a number of these questions could have been formulated in a better fashion". It was therefore not unreasonable for the applicant to decline to take the risk by another response of creating further inconsistency which the police might regard as sustaining criminal charges. The interpretation was also open that the applicant was no longer being asked to provide information to assist the Bank's investigators in continuing inquiries, but rather was being given a last opportunity to rebut their provisional inculpatory conclusions."

14 That reasoning entails that, if reviewed with the average, fair-mindedness imputed to a reasonable employer by the Full Court in the last paragraph of the extract from Perkins v Grace Worldwide quoted above, Mr Patty's refusal to respond to the letter of 24 June 1996, either alone or in combination with the claim about Ms Blencowe's pay envelopes, if that was, in fact mistaken or untruthful, would not be regarded as destructive of the requisite trust and confidence.

15 It follows from the conclusions reached in the earlier reasons that I cannot regard the Bank's loss of trust and confidence in the applicant as soundly and rationally based insofar as it is founded on the suspicion that Mr Patty had been implicated in the theft from the ATM. This is a case, I consider, where the Bank has been reluctant to shift from the view that the wrongdoing which it imputed to the applicant has occurred, notwithstanding the finding on that question expressed in the earlier reasons. Accordingly, were I to regard that reluctance as destructive of the requisite trust and confidence, the applicant would, as the Full Court pointed out in the passage just quoted from Perkins v Grace Worldwide, be denied access to the primary remedy provided by the legislation. I am not persuaded, having regard to the circumstances as a whole, that it is impracticable for the Bank to re-employ Mr Patty in a position broadly equivalent to that which he occupied immediately before he was dismissed.

16 Notwithstanding the opinion just indicated that the reinstatement of the applicant is not impracticable, the question is left open by s 170EE of the Act whether the Court considers it appropriate, in all the circumstances of the case, to make an order requiring the Bank to reinstate the applicant. That question turns, as indicated in Liddell v Lembke (supra), on the exercise of a general discretion circumscribed only by the subject matter and scope and purpose of the legislation. The only consideration pointed to by Counsel for the Bank, in addition to the matters said to have destroyed the relation of trust and confidence, is the applicant's delay at various stages in prosecuting his claim for the remedy of reinstatement. It is true that a great deal of time has been wasted in the taking of interlocutory steps before and after the Judicial Registrar's decision and in attempts, which for reasons explained below have proved unavailing, to invoke the Court's accrued or associated jurisdiction. However, when regard is had to the size of the Bank's workforce, its conceded ability to re-employ the applicant after the lapse of time which has occurred and the absence of any identifiable present or prospective other employee who would be prejudiced by the reinstatement, that part of the delay attributable to the applicant or his advisors does not preclude the grant of the primary remedy. As explained below, that is not to say that delay may not be a factor in conjunction with others, to be taken into account in moulding the consequential relief contemplated by s 170EE(1)(b).

Should the applicant be accorded a notional promotion?

17 Mr Kenyon of Counsel for the applicant contended that, as well as ordering the reinstatement of the applicant in his employment, the Court should make orders which put the applicant in the position in the Bank's service in which he would have been had his employment been uninterrupted and had he been given the promotions which he could reasonably have expected to have achieved during the intervening period. It was suggested that a guide to the appropriate notional promotions would be those achieved, in fact, by Mr Centofanti.

18 A fundamental difficulty in the way of this suggestion is that the primary remedy stipulated by s 170EE(1)(a)(i) is reappointment to the position in which the employee was employed immediately before the termination. In my view, resort to the alternative stipulated in s 170EE(1)(a)(ii) of appointment to another position on terms and condition no less favourable than those on which the employee was employed immediately before the termination is only available where the position in which the employee was employed immediately before the termination has been abolished or is occupied by some other person so that reappointment to it is not practicable. It does not authorise the Court to require the appointment of the applicant to some other more favourable position to which it thinks he or she might, or would, have progressed.

19 The case would be otherwise if there were evidence that the position in which the applicant was employed immediately before the termination was at a point below the highest on a scale through which the employee, but for the termination, would automatically have progressed. In that case, the discretions conferred by s 170EE(1)(b) would be available to ensure the notional maintenance of the continuity of employment and the receipt of any increments in remuneration which that continuity would have entailed. However, the evidence does not suggest that Mr Patty had any contractual entitlement to incremental progression through a salary scale attached to the classification GC3 or to promotion to any higher classification.

20 The evidence in respect of the machinery by which Bank Officers are selected for promotion was scanty and inconclusive. The inference which I draw from the evidence, including that of Mr Wade, is that promotion depends on the assessment by supervisors of a candidate's merits and likely capacity to fill a particular promotional vacancy. There is no longer any system of appeals against proposed promotions. Mr Centofanti, to whom I was invited to assimilate Mr Patty, was an Assistant Branch Manager at the time of the applicant's dismissal and has moved only one promotional level since then. In the light of these matters, and the express language of s 170EE(1)(a), I am persuaded to order only that the Bank reinstate the applicant by appointing him to a position equating as closely as practicable with that of an officer in classification GC3 as at 27 August 1996.

21 However, an order should also be made maintaining the applicant's continuity of employment for purposes of long service leave and superannuation, subject to his bringing to account any moneys received in respect of those matters upon termination. It will be recalled that the Bank's letter of 27 August 1996 ended;

"We will be writing to you separately regarding release of your final salary payment and your superannuation entitlements."

In case any difficulty arises about the adjustments necessary to restore the applicant's accrued entitlements to long service leave and superannuation, I shall reserve liberty to apply.

Should orders be made for maintenance of continuity of the applicant's employment or payment of lost remuneration?

22 The powers conferred by s 170EE(1)(b)(i) and (ii) of the Act, as indicated by the words which preface the sub-section as a whole, are also discretionary. As indicated in [16] of these reasons, a considerable part of the delay in achieving a final resolution of his claim has been attributable to delay on the part of the applicant at various interlocutory stages at the hearing before the learned Judicial Registrar and on the application for review. Some of that delay has resulted from the pursuit of alternative remedies invoking the Court's accrued or associated jurisdiction. I have also been informed from the Bar table that some delay after the publication of the earlier reasons has been attributable to "without prejudice" negotiations between the applicant and the Bank which did not bear fruit. It is, of course, not possible to assign responsibility for the breakdown of those negotiations but I do not regard the fact that they have occurred as justifying an order that Mr Patty be remunerated as if he had been employed by the Bank while those negotiations were proceeding.

23 Another difficulty in the way of my exercising the Court's discretion in favour of making an order for payment of lost remuneration is the absence of evidence of what the applicant has been able to earn in alternative employment since the dismissal. I have been told by Counsel for the applicant that he lost a short-term position with Crown Casino upon the handing down of the Judicial Registrar's decision which the Casino apparently considered reflected adversely on the applicant's reputation for honesty. There is no evidence that any attempt was made to regain that employment after publication of the earlier reasons which might have been thought to have vindicated the applicant. Mr Kenyon also referred to the fact that the applicant had been "in employment on lower wages at Strathfield Car Radios" but there is no evidence of the remuneration derived from that employment or the period for which it subsisted. Nor is there evidence of amounts (if any) received as social security payments during intervals of unemployment, as to which see Wood v District Council Crystal Book - Redhill (1992) 45 IR 342. (Mullany v Active Concrete (1995) 62 IR 237 to which I was referred in this context by Counsel for the applicant, was concerned with the calculation of compensation under s 170EE(3), not payment of lost remuneration under sub-s (1)(b)(ii)). In these circumstances, I am not prepared to order the Bank to pay remuneration lost between 27 August 1996 and the coming into effect of the order for reinstatement.

Other relief

24 As already indicated, the applicant has invoked the accrued or associated jurisdiction of the Court in pursuit of a claim for damages at common law founded on the principles enunciated by the House of Lords in Malik v Bank of Credit and Commerce International S.A. [1997] UKHL 23; [1998] AC 20. In that case, the applicants were employees of a bank (BCCI) whose employment had been terminated on the grounds of redundancy. After the termination it was revealed that regulatory authorities had found that BCCI had, for many years, carried on business fraudulently. Thereafter, each applicant had, he claimed, been unable to obtain employment in the financial services industry because of the stigma attaching to him as a former employee of BCCI, notwithstanding his innocence of any wrongdoing. It was held on appeal that BCCI had been guilty of a breach of the implied term that it would not conduct itself in a manner likely to destroy or seriously damage the relationship of trust and confidence between employer and employee. Damages were held to be recoverable for that breach despite the fact that it had only come to light after the termination of the employment relationship.

25 It will be seen that the present case stands in marked contrast to Malik because, as a result of the proposed order for reinstatement, the relationship of employment between the applicant and the Bank will not be at an end. Even more significant is the fact that, in my opinion, Div 3 of Pt VIA of the Act constituted a code exclusively regulating the unlawful termination of the employment of employees who chose to invoke it. The consequence is that an election had to be made between, on the one hand, the remedies available under that Division, including compensation subject to the limit prescribed by s 170EE(3), and on the other, remedies, principally damages, at common law or otherwise where the damages were at large subject to ordinary principles of assessment. In the present case, the applicant has elected for, and obtained, the primary remedy of reinstatement afforded by s 170EE(1) and his claims for other relief must be dismissed.

Conclusion

26 As foreshadowed in the earlier reasons, the proceedings in the Federal Court must be dismissed. Also consistently with the earlier reasons I shall make procedural directions in IRCA treating the proceedings instituted in the Federal Court as having been instituted in IRCA and all of the evidence adduced and submissions made in those proceedings as having been adduced and made in IRCA. In addition, it will be declared that the Bank has contravened s 170DE(1) of the Act by terminating the employment of the applicant without a valid reason or valid reasons for doing so. There will be an order for reinstatement conforming with that indicated in [20] of these reasons and it will be ordered that, subject to the applicant's accounting for payments received after 27 August 1996 in respect of long service leave and superannuation, the continuity of the applicant's employment be treated as having been maintained for the purpose of preserving any accrued entitlements to those benefits. Finally, as indicated in [21] above, I shall reserve liberty to apply.

I certify that the preceding twenty-six (26) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Ryan.

Associate:

Dated: 19 February 2002

Counsel for the Applicant:	Mr N Kenyon
Solicitor for the Applicant:	Ryan Carlisle Thomas
Counsel for the Respondent:	Mr B Dennis
Solicitor for the Respondent:	Ian F Purbrick
Date of Hearing:	1 February 2001
Date of Judgment:	19 February 2002