SUPREME COURT OF QUEENSLAND

1. McMURDO P:  I agree with the reasons of Thomas JA.

2. THOMAS JA:  This is an appeal against a decision allowing a demurrer to a paragraph of a statement of claim.

3. The appellant is the plaintiff in an action against the respondent claiming damages for negligence or breach of statutory duty or breach of contract of employment resulting in psychiatric injury to him. A substantial part of the statement of claim alleges actions for which the respondent was said to be directly or vicariously liable involving harassment, intimidation, victimisation, inappropriate treatment when the respondent should have known that the plaintiff was suffering from a stress related disorder, failing to put in place appropriate management processes and the like. The demurrer in question is confined to a further or alternative claim that is made in paragraph 10 of the statement of claim.

4. That paragraph states:

"Further and/or in the alternative:-

1. On or about 8 February, 1996 the Plaintiff made a complaint in writing to the Criminal Justice Commission regarding certain conduct of Don Fewquandie, and concerning his employment with the Defendant;

2. The said complaint was a public interest disclosure within the meaning of the Whistleblowers Protection Act 1994;
3. On or about 7 August, 1996 Don Fewquandie, and another employee of the Defendant, Robert Win-Boh:-

1. knew of the complaint made by the Plaintiff to the Criminal Justice Commission, or believed one had been made;

2. lodged a complaint with the Defendant regarding alleged misconduct of the Plaintiff affecting them in their employment on the part of the Plaintiff.

4. the said complaint was made by Fewquandie and Win-Boh because of the said public interest disclosure by the Plaintiff,
5. the said complaint was made by Fewquandie and Win-Boh with the intention, or alternatively, in any event, with the effect of, the Plaintiff being subjected to a disciplinary process by the Defendant;
6. in the premises, by their making the complaint, Fewquandie and Win-Boh took a reprisal within the meaning of s.41 of the Whistleblowers Protection Act 1994;
7. in the premises, the Defendant is vicariously liable for the tort of reprisal committed by Fewquandie and Win-Boh."

5. The allegations in essence are that in the terms of the Whistleblowers Protection Act 1994 the appellant was a whistleblower; that two fellow employees were guilty of a reprisal against him under s 41 of the Act; and that the defendant employer is vicariously liable to the appellant for their actions.

6. The Whistleblowers Protection Act 1994 ("the Act") seeks to protect persons who disclose certain matters of public interest.  It permits certain disclosures to be made to a "public sector entity" which includes a department such as the respondent in this action. A disclosure about official misconduct is one of the types of public interest disclosure that may be made.  Of course complaints (as distinct from disclosures) of official misconduct may be made to the Criminal Justice Commission under the Criminal Justice Act 1989.  The statement of claim alleges that the complaint that was made to the Criminal Justice Commission "was a public interest disclosure within the meaning of the Whistleblowers Protection Act 1994", and it has been assumed for present purposes that that allegation is correct. 

7. The following sections of the Act are relevant and will be here set out:

"41(1) A person must not cause, or attempt or conspire to cause, detriment to another person because, or in the belief that, anybody has made, or may make, a public interest disclosure.

2. An attempt to cause detriment includes an attempt to induce a person to cause detriment.
3. A contravention of subsection (1) is a reprisal or the taking of a reprisal.
4. A ground mentioned in subsection (1) as the ground for a reprisal is the unlawful ground for the reprisal.
5. For the contravention to happen, it is sufficient if the unlawful ground is a substantial ground for the act or omission that is the reprisal, even if there is another ground for the act or omission."

"42(1) A public officer who takes a reprisal commits an offence.  Maximum penalty – 167 penalty units or 2 years imprisonment

2. The offence is an indictable offence.
3. If a public officer commits the offence, the Criminal Code, sections 7 and 8 apply even though a person other than a public officer may also be taken to have committed the offence because of the application."

"43(1) A reprisal is a tort and a person who takes a reprisal is liable in damages to anyone who suffers detriment as a result.

2. Any appropriate remedy that may be granted by a court for a tort  may be granted by a court for the taking of a reprisal.
3. If the claim for the damages goes to trial in the Supreme Court or the District Court, it must be decided by a judge sitting without a jury."

"44. A public sector entity must establish reasonable procedures to protect its officers from reprisals that are, or may be, taken against them by the entity or other officers of the entity".

8. The statement of claim does not allege any breach of or failure to comply with the requirements of s 44 on the part of the respondent. It simply alleges that "in the premises, the defendant is vicariously liable". However very few "premises" are contained in the statement of claim. Indeed there is no allegation of fact other than those showing the commission of the offence of reprisal by two fellow employees followed by the assertion "in the premises the defendant is vicariously liable". In turn the demurrer asserts that the defendant is not vicariously liable in tort for any reprisal committed by its employees within the meaning of s 41.  In allowing the demurrer the learned Chief Justice expressed his finding more narrowly, holding that the Act excludes the vicarious liability which the plaintiff alleged in paragraph 10 of the statement of claim.

9. It may be noted that at common law the Crown is not vicariously responsible for the tortious acts of its employees.^[1]  However in proceedings against the Crown legislation requires the procedure to be "as nearly as possible" in accordance with the procedure applicable to a proceeding "between subject and subject", and the rights of the parties are "as nearly as possible the same".^[2]

10. Two separate questions arise in this case. One is whether the demurrer should be upheld on the ground that on the proper construction of the Act vicarious liability is excluded. The other is, assuming that the Act leaves vicarious liability open, whether this statement of claim alleges facts capable of establishing such liability against the defendant.

Does the Act exclude vicarious liability?

11. A clear distinction needs to be maintained between the concept of vicarious liability and that of direct liability by a corporation or a public sector entity for acts which the controlling mind of the corporation or public sector entity causes to be performed.^[3]  If an officer of the public sector entity with sufficient control over its governing mind had caused such a complaint to be made, the entity, that is to say, the department, would be directly liable for reprisal under s 41 and s 43.  There is no allegation here that the department itself committed an offence under these sections.  The submission is that two employees committed an offence under s 41 and that the department, by investigating their unlawful complaint became vicariously liable under s 43 for the employee's offence.  Direct original liability of the department would arise if it actually instigated the complaint or counselled and procured the bringing of it or otherwise knowingly aided or assisted in the commission of the offence.^[4]

12. The submission suggests that whenever an employee commits a reprisal against a fellow employee by causing his or her employer to investigate a complaint, the employer becomes vicariously liable for the reprisal, provided that the making of the complaint occurred in the course of the employment of such person. The submission proceeds that the employer would even be liable for investigating a legitimate complaint (eg improper use of departmental property) against the whistleblower employee, so long as one of the reasons or motives of the complainant was based on the whistleblowing activity.^[5]  A necessary consequence of the submission is that the disgruntled employee's complaint is treated as a complaint by the employer to itself.  Furthermore it would be a curious result if a department could become vicariously liable by investigating a complaint which was, unknown to the department until the complaint was investigated, a reprisal by an employee against another employee.

13. The tort created by s 41 and s 43 was described by Mr Holyoak for the respondent as an intentional tort. The requirement of s 41(1) is that someone causes detriment "because, or in the belief that … anybody has made … a public interest disclosure". The use of the so-called plain English "because" provides a wide and imprecise link, but the section seems to require that the offender's actions be motivated by some state of knowledge or belief that the target person has acted in a certain way. The authorities suggest that vicarious liability will not be readily implied in relation to intentional torts of this kind.^[6]   This is however not a conclusive consideration in the context of a demurrer, as questions of fact and degree tend to intrude into the determination of such cases.  But it is a factor to which at least some regard may be had in attempting to ascertain any intention in the Act to make public sector entities liable vicariously for acts of reprisal committed by their employees.

14. The difficulty of implying vicarious liability in cases of intentional torts was recognised by Murray J in Hart-Roach v Public Trustee.[7]  His Honour stated:

"A difficulty which may emerge is that the tort of public misfeasance is one of those intentional torts to which I referred earlier.  It requires an act which is in fact and in law unauthorised, and which is done with the mental element that there was an actual intention to cause injury, or that it was known that there was a lack of power and injury might well result, or that there was reckless indifference to the existence of power and likelihood of injury.  That being so, it is difficult to conceive that the ordinary rules about vicarious liability could apply".

His Honour thought that such a position would be governed by the more confined tests that emerge from cases such as Deatons v Flew, including whether the wrongful act was one "to which the ostensible performance of his master's work gives occasion", and whether the wrongful act was "committed under cover of the authority in which he is placed as a representative of his master".^[8]  The situation here pleaded does not satisfy those tests.

15. Under s 42(2) of the Act, reprisal is an indictable offence. Illegal acts committed by an employee which are inimical to the purposes of the employment are regarded as falling outside the course of employment and no vicarious liability falls upon the employer for them.^[9]  An act such as that here pleaded is not only a criminal offence, it is, in terms of the test posed by Glass JA in Commonwealth of Australia v Connell[10] "an independent unauthorised act … outside the scope of his service".^[11] 

16. It is to be noted that s 44 of the Act casts a duty upon a public sector entity to establish reasonable procedures to protect its officers from reprisals. That section and the direct liability of a public sector entity for its own acts in my view mark the limits of the civil law liability that the Act envisages in such matters on the part of a public sector entity.

17. In summary the nature of the tort identified in s 43 is such that it may be committed only by the direct acts of a person or corporation and that vicarious liability for the acts of others is excluded.

18. The demurrer should therefore be upheld.

Lack of factual basis in statement of claim

19. In case the above conclusion is erroneous, it is desirable to mention that the demurrer should in any event be upheld because of the absence of the necessary factual basis in the statement of claim for a finding of vicarious liability.

20. Mr Diehm for the appellant submitted that the making of the complaint by the plaintiff's fellow employees was within the scope of their employment because what they did was merely an unauthorised way of performing an authorised act.

21. However, the present pleading does not allege that the complaint by Fewquandie and Win-Boh was authorised by the respondent or that it was an act within the scope of their employment. Mr Diehm submitted that any authorised act of an employee is within that employee's scope of employment, but his use of the word "authorised" seems equivalent to "permitted" or "not prohibited". He contended that the complaint made by Fewquandie and Win-Boh (referred to in paragraph 10 of the statement of claim) although a reprisal and in itself an offence, must be inferred to have been authorised by the respondent, and that it is therefore to be regarded as the doing of an authorised act in an unauthorised way.

22. The submission continued that the view of Fullagar J in the Darling Island case^[12] ought to be preferred over that of the other members of the court (Williams, Webb, Kitto and Taylor JJ), the latter being said to favour what is sometimes called the "master's tort" theory as the true basis of vicarious liability.  On this theory the origin of the duty lies in the employer, and the acts of the employee are imputed to the employer.  Another theory sometimes said to be a "strict liability" theory of vicarious liability, merely requires proof of a tort by the employee committed in the course of employment.  It is unnecessary to resolve this question which has interested text book writers for many years.  On any view vicarious liability is not established against an employer for an employee's acts outside the scope of the employment.^[13] 

23. It has never been suggested and is not suggested in this case that an employer becomes vicariously liable merely because an incident occurs at work or involves something that happens between employees at the workplace. It may well be that such a complaint was permitted by the employer, but in the absence of some allegation of fact concerning the nature of the employer's system in relation to making complaints by employees and that the act was within the scope of the employee's employment, there could be no basis for vicarious liability.

24. Furthermore it is difficult to find any analogy between the present situation and those cases where an employee, in the course of performing work of the kind which he or she was employed to do, does it in an inappropriate and unauthorised way and thereby causes injury to a third party.^[14]  Assuming that there was an authorised complaints procedure which Fewquandie and Win-Boh were following, the present allegations are not even close to an ostensible performance of the employer's work, or activity that the complainants were employed to perform.  The allegations are more distant from the furtherance of the employer's interests than the activity of the barmaid in Deatons who, when angered by a customer's conduct, threw a beer glass at the customer.  The court regarded her act as done "neither in furtherance of the master's interests nor under his express or implied authority nor as an incident to or in consequence of anything the barmaid was employed to do".^[15]  These words are appropriate here.  Assuming in favour of the plaintiff that the employer had a general system that permitted employees to make complaints, the unlawful complaint of Fewquandie and Win-Boh would be an abuse not only of the plaintiff's rights but also of the employer's system.  The allegations are in my view incapable of satisfying the above tests, or more recent statements such as those in Commonwealth of Australia v Connell.[16]

25. It follows that, even assuming in the appellant's favour that vicarious liability is available under the Act, I would still uphold the demurrer, and consider that there is no basis to grant leave to re-plead.

Costs

26. His Honour ordered the appellant to pay the respondent's costs of the demurrer in any event. However under s 182C(3) and 182C(6) of the Worker's Compensation Act 1990, which the parties agree applies in this action, such an order is not able to be made on an interlocutory application.  The point was not raised before his Honour, but as a jurisdictional error is disclosed it is appropriate that it be now corrected.  Counsel for the respondent agreed that this was appropriate.  It is not a matter which occupied any significant time on the appeal, and had it been raised below it may be inferred that the appropriate order would have been made, or in any event corrected by consent without bringing an appeal.  Accordingly it should be ordered that the order that the costs of and incidental to the demurrer be the defendant's costs in any event be set aside.  This however should not carry any consequences in relation to the costs of the appeal.

Orders

27. It will be ordered that the order that the costs of and incidental to the demurrer be the defendant's costs in the cause be set aside. Otherwise the appeal should be dismissed with costs.

28. AMBROSE J:  I agree.