Court of Appeal decision explores duty of care

The Court of Appeal decision in Hayes & Ors v State of Queensland [2016] QCA 191 explores duty of care to provide support to employees undergoing disciplinary investigations to prevent psychiatric injury.

Crown Law’s WorkCover Team represented the State in related claims instituted by four government workers seeking damages in relation to psychiatric injuries allegedly suffered by each of them as a result of stress in their workplace arising from disciplinary processes.

The State succeeded at first instance before District Court Judge McGill. A previous Crown Law legal article ‘WorkCover decision explores duty of care and psychiatric injury’ issued on 15 July 2015 by A/Special Counsel, Rachael Murray discussed the initial decision.

Special Counsel, Andrew Hall and A/Assistant Crown Solicitor, Fran Keyes presented a paper at the annual Crown Law Legal Conference on 20 July 2016 about managing claims for psychiatric injury by government workers, focusing on the initial decision.

The plaintiffs appealed the decision.

As reported in a Crown Law legal article on 29 July 2016, the Queensland Court of Appeal (per Mullins and Dalton JJ, with Margaret McMurdo P dissenting) subsequently found in favour of the State.

Key points in the appeal

The Court of Appeal considered three issues:

  1. Whether the State owed a duty of care to the four plaintiffs.
  2. Whether the State breached the duty.
  3. Whether any alleged breach of duty caused the plaintiffs’ psychiatric injuries.

The Court of Appeal decision

1. Whether a duty of care was owed

The plaintiff appellants argued that the trial judge erred in finding that the State did not owe each plaintiff a duty of care to provide adequate support while the State’s investigations into complaints were completed.

This aspect of the appeal was particularly important for the State, as Judge McGill found that no duty of care was owed to provide special or additional support in relation to an investigative process, but did say that if such a duty did arise, the State would have been found to have breached it.

This confirmed the law as stated in New South Wales v Paige (2002) 60 NSWLR 371. Contrary to the trial judge’s decision, Mullins and Dalton JJ concluded that with the exception of one of the plaintiffs (Ms Greenhalgh, as her case was factually slightly different) a duty of care was owed to all of them. On the question of whether a duty of care arose, McMurdo P differed from the majority only in her conclusion that Ms Greenhalgh was also owed a duty by the employer.

Their Honours distinguished principles arising from previous case law that no duty of care was owed by the State during an investigation, on the basis that the current claims turned not solely on the conduct of the investigation, or the decision-making in relation to the complaints against the plaintiffs, but the State’s lack of support of each the plaintiffs at the time of the complaints and investigation.

It was noted that nothing in previous case law exempted the employer from its duties to provide and maintain a safe workplace, to take all reasonable precautions for each employee’s safety whilst engaged in employment, and not to expose an employee to risk of damage and injury of which it knew or ought to have known.

Nothing in the previous case law exempted the employer from the aspect of those duties to provide reasonable support to each employee following a complaint and during the investigation resulting from that complaint.

With respect to the decision of Paige, it was found that the trial judge misapplied Paige because the plaintiffs did not make a complaint about the investigation itself. Instead, the plaintiffs’ case was based on a duty to support them as employees while investigations were carried out. Their Honours concluded that the principles of Paige did not stand in the way of a duty of care arising.

The employer in the present case was on notice that the plaintiffs were vulnerable in a hostile workplace, while their conduct was being investigated. The employer would have well understood that the events which had begun were of such significance that it would be reasonable for an employer to have realised that the plaintiffs against whom complaints had been made replaced in a serious, difficult and indeed vulnerable situation which would not be quickly resolved. Further, such employees might be upset and distressed and may require support by way of counselling.

2. Whether the State breached its duty of care

The plaintiffs’ case was the State failed to take steps to provide support, or adequate support, in circumstances of workplace hostility and investigations.

The majority of the Court of Appeal (Mullins and Dalton JJ) found in the plaintiffs’ favour in relation to three of the four claims. The majority ruled against the fourth plaintiff, Ms Greenhalgh, on the basis that the employer owed no relevant duty of care because in their view it was not reasonably foreseeable that Ms Greenhalgh would suffer psychiatric illness, rather than just unhappiness, in the sense of injustice and stress in the workplace if support were not provided to her.

As distinct from the other plaintiffs, Ms Greenhalgh did not lose her substantive position while the investigation was carried out. In fact, Ms Greenhalgh was moved to a new role which she had sought and was thus somewhat insulated from the workplace conflict. McMurdo P, in dissent, was of the opinion that the employer’s duty of care had been breached in all four cases.

3. Causation

The real question arose as to whether or not the breaches which were established on the evidence caused the psychiatric injuries sustained by the plaintiffs.

The plaintiffs relied on evidence from psychiatrist, Dr Andrew Byth. The majority (Mullins and Dalton JJ) found that causation was not established. McMurdo P dissented on this issue.

The majority noted the difficulty with concluding that the matters in Dr Byth’s evidence caused the psychiatric condition was that there was a significant mismatch between the factual basis upon which Dr Byth proceeded and the facts which were proved at trial. They noted the trial judge did not analyse those discrepancies.

Further, the majority noted the factual account of what had occurred in the workplace provided to Dr Byth was different in significant respects from the evidence provided by the Plaintiffs at trial. There were significant parts of the accounts that were provided to Dr Byth were complaints about the investigation.

It was noted the trial judge took the course of analysing the issues of causation and the injury before analysing issues of duty and breach and made no specific finding as to when the duty arose.

Ultimately, the majority found the factual case which Dr Byth considered as causing injury was so different and so much more extensive than the matters which constitute the breach of duty in the plaintiffs’ case that it would be unsafe to conclude that the breaches were even a substantial cause of the injury suffered.

Key points for the State

The decision confirms the high duty of care the State owes its employees and authority in support of the proposition that the State owes a duty of care to provide appropriate support to its employees during an internal investigation process, particularly in circumstances where as in this case, the State was on notice that the plaintiffs were vulnerable and in a hostile workplace while their conduct was being investigated.

Appeals for special leave to the High Court of Australia

On 1 September 2016, the four plaintiffs served applications on Crown Law seeking special leave to appeal to the High Court of Australia. The State intends to formally respond to these applications. A further update will be provided once the High Court determines this issue, including a ‘what next’ analysis if appropriate.

The information in this publication is provided for general purposes only. It is not to be relied on as a substitute for legal advice. Crown Law and the Department of Justice and Attorney-General accept no liability for losses caused by reliance on the material in this publication. Formal legal advice should be obtained for particular matters.

Published: 7 September 2016

Author: Principal Lawyer, Fleur Nash