Gairns v Pro Music Pty Ltd[2024] QDC 118

DISTRICT COURT OF QUEENSLAND

Introduction

1. [1]
   The defendant is a distributor of musical products supplying musical instrument retail stores throughout Australia, with its head office in Carole Park.  The plaintiff was employed by the defendant as an internal sales supervisor and worked from the head office.  His claim of approximately $500,000 is for damages for a psychiatric injury.  It is based on liability of the defendant in negligence, based on the common law principles as modified by the Workers’ Compensation and Rehabilitation Act 2003 (Qld) (‘the Act’).  The psychiatric injury is said to arise as a consequence of the nature and circumstances of a meeting the plaintiff had with the defendant’s managing director, Ian Corazzol in February 2019 (‘the meeting’).
2. [2]
   It is not contentious that during the meeting Mr Corazzol told the plaintiff that his supervisory role was to be relinquished, with a corresponding reduction in his salary.  It is also not in issue that prior to the meeting the defendant was aware that the plaintiff was an emotional person and that his personality was such that he could “quite easily” become stressed and anxious.^[1]
3. [3]
   According to the plaintiff, a reasonable person in the position of the defendant would have taken the following precautions which would have avoided the risk of injury:

1. prior to the meeting:

1. providing to the plaintiff written notice of the specific concerns about his performance and the steps that would be taken if it did not improve;

2. investigating the concerns regarding the plaintiff’s performance and communicating the outcome of the investigation to him;

3. giving the plaintiff the opportunity to respond to the concerns about his performance prior to demoting him;

1. giving the plaintiff an opportunity to bring a support person to the meeting;

2. not conducting the meeting in the open plan office where the defendant knew or ought to have known that it could be overheard by other staff members, including employees whom the plaintiff supervised.

4. [4]
   The defendant denies that it was required to take any of the precautions referred to in the abovementioned paragraph.  It further contends that since at least 2017 the plaintiff was aware that the defendant considered his work performance to be below standard.
5. [5]
   The evidence was heard over two days in late May 2024.  The parties provided detailed written submissions. Oral submissions were heard on 31 July 2024.
6. [6]
   Apart from the plaintiff, the only lay witness called by him was his son Oliver Gairns.  He was living with the plaintiff at the time and gave brief evidence about his observations of the plaintiff after he returned home from the meeting and in the months prior to it.  While I had no reason to doubt his evidence, it was of very limited relevance in resolving any of the contentious issues.
7. [7]
   The lay witnesses called by WorkCover were all employed by the defendant. Ian Corazzol owned the defendant’s business and was its managing director.  His two adult children, being Matthew Corazzol and Jodie Hart, also worked there. The plaintiff supervised Matthew Corazzol in the internal sales team and Ms Hart was the office manager.  The only other lay witnesses to give evidence were Rose Brumwell and Ian Evans.  They are father and daughter. Ms Brumwell worked in the internal sales team with Matthew Corazzol and was also supervised by the plaintiff. Mr Evans only commenced working for the defendant in the six months prior to the meeting.  He was initially employed as the service manager. Expert evidence was given by two psychiatrists, namely Drs Oo and Murphy.   There were 12 exhibits tendered.
8. [8]
   It is pleaded in paragraph 12(d)(v)(1) and (3) of the amended statement of claim that demoting the plaintiff and reducing his salary was unjust pursuant to s 385 of the Fair Work Act 2009 (C’th) and was contrary to the Small Business Fair Dismissal Code.   At the commencement of the trial, counsel for the plaintiff informed the court that these allegations were not being pressed.  

Credibility

9. [9]
   As would be expected, none of the witnesses had perfect recollections in attempting to recall conversations and events that happened up to more than five years earlier.  This includes the plaintiff.  A critical issue in this trial is whether he was an honest and reliable witness.  He bears the onus of proof to satisfy the court on the balance of probabilities that his claim should be accepted.
10. [10]
    An example of the imperfect recollections of the plaintiff relates to his evidence as to who was present in the office when he left the meeting and returned to his desk.  He told Dr Oo in April 2022 that he spoke with Mr Evans and noticed that two other co-workers were there.  However, in evidence more than two years later, he said that he did not recall seeing anyone apart from Mr Evans.  It seems likely that what the plaintiff told Dr Oo about this is the most accurate because it accords with the evidence of other witnesses.
11. [11]
    There are other parts of the plaintiff’s evidence which I do not accept.   One such example is his evidence that prior to the meeting, he had no intention of leaving his employment with the defendant.  There are two reasons why this seems unlikely and that he was at least considering his work options. First, he had already been for an interview with another company and had a second interview scheduled in the hours after the meeting.   While he said that the reason he was not really interested in the job was because he did not want to work the hours required for retail work, the potential employment opportunity was broader than this.  The business also had a wholesaling aspect to it.   Second, by the time of the meeting, it seems that the plaintiff had not been happy working with the defendant for nearly 12 months.  On 6 March 2018 he told Dr Luu, general practitioner that Mr Corazzol was bullying him at work.  Further, it was the plaintiff’s evidence that he felt Mr Corazzol’s attitude towards him changed in mid-2018 after he negotiated a salary increase.   Then, on 19 October 2018 the plaintiff told Dr Jaishankar that he was not getting on with Mr Corazzol, was unhappy with his workload and that attending work the previous day had made him feel sick.  In addition, the plaintiff gave evidence that Mr Corazzol was excluding him from conversations.  In particular, he referred to an occasion on Melbourne Cup day in 2018, when he said Mr Corazzol turned his back on him part way through a conversation.
12. [12]
    While there are parts of the plaintiff’s evidence that I do not accept, it was my impression that he was generally credible and reliable. This necessarily means that I reject the defendant’s submission that I should be reluctant to accept his evidence where uncorroborated, and that I should exercise caution in accepting his version of events where it conflicts with others.
13. [13]
    As to Mr Corazzol, I was less impressed by him as a witness.   It was my impression that he sought to downplay some of the more concerning aspects of his conduct at the meeting.  He was keen to create the impression that he was unfailingly mild mannered, calm and rational in his interactions with others at work. Whilst this may be an apt description of his usual demeanour, I am satisfied there were occasions when he had previously raised his voice in the workplace.  The plaintiff’s evidence in this regard was corroborated by Ms Brumwell.  She gave an example of a time when she overheard him yelling at Matthew Corazzol for having applied incorrect discounts to orders.  Matthew Corazzol confirmed that there were occasions when his father had yelled at him over the phone for this reason.  Mr Corazzol’s other son, Bradley worked as the defendant’s warehouse manager.  The plaintiff gave evidence of an occasion where Mr Corazzol was also yelling at him when there was a disagreement about the expectations which Mr Corazzol had of the warehouse staff.  I accept this evidence.  
14. [14]
    I also do not accept Mr Corazzol’s evidence that he was not speaking in a raised voice at the meeting with the plaintiff and that he otherwise conducted himself appropriately.  This is addressed in further detail in paragraphs 38 to 43 below.   
15. [15]
    Ms Hart could not be regarded as an independent bystander to the litigation.  It was my impression that some parts of her evidence were selective and were motivated by a desire to assist Mr Corazzol.  I was not convinced by her evidence that the first time she became aware that the meeting was to involve the plaintiff, was when she saw the plaintiff walking to her father’s office.   I was also unconvinced by her evidence that prior to the meeting she did not know that the purpose of it was to tell the plaintiff that he was being demoted.  This is because it seems very likely that she had already been informed that Mr Evans was commencing as the national sales manager on the following Monday, with the consequence that the plaintiff’s role as a supervisor would become a supernumerary one.  It is equally likely that she knew that the plaintiff had not yet been told of this development.  There are numerous reasons why I am compelled to make these factual findings.  First, as the office manager, Ms Hart was intimately involved with the day-to-day operations of the business, and the plaintiff’s demotion was clearly relevant to her role.  Second, I am satisfied that Mr Corazzol would have confided in his daughter about such a significant change to the business operations.  This is particularly in circumstances where the position of general manager had not been filled. Third, on Ms Hart’s evidence she considered that she had some supervisory authority over the plaintiff.  For example, she said that she had previously spoken to the plaintiff about taking too many cigarette breaks and not having properly completed order forms for sales he had generated.  Fourth, it cannot be overlooked that Ms Hart’s office was immediately adjacent to Mr Corazzol’s and was only separated by some head high partitions.  Such was their proximity, that she needed to effectively walk through Mr Corazzol’s partitioned office to enter and leave her workspace.  Fifth, for the reasons detailed above, Ms Hart’s evidence that her father phoned her in her office and asked her to move to the other end of the office “as he was going to have a conversation with someone”^[2] does not withstand scrutiny.
16. [16]
    As to Matthew Corazzol’s evidence, his memory of relevant events seemed vague at best.  With respect to Ms Brumwell and Mr Evans, I was left with the general impression that they were both credible and answered questions honestly.  
17. [17]
    Wherever possible, I have sought to resolve conflicts in witness accounts by not only their demeanour, but also by reference to objective facts proved independently of the testimony given.  This has included the exhibits, the inherent probabilities of the case and the motives of the witnesses. Where this has not been possible, I have resorted to concepts of onus of proof.  Where necessary, I have indicated below the extent to which I have accepted or rejected the evidence of particular witnesses. 

Relevant background

18. [18]
    While the plaintiff’s claim arises out of the meeting, some review of the office layout and earlier events in the defendant’s workplace is necessary to place the meeting in context.  

Office layout

19. [19]
    The defendant operated its business from a two-storey building with internal stairs between the floors.   The warehouse and service manager’s office were downstairs.  The office upstairs was open plan with some head high partitions.^[3]  At one end, was where Ms Hart sat.  Mr Corazzol was in the office next to her with partitions between them.  The other side of Mr Corazzol’s office was also partitioned off from the remainder of the office.   Ms Brumwell’s desk was the next closest to Mr Corazzol’s office, and there was approximately 13.5 metres separating them.   The plaintiff sat next to Ms Brumwell, with a partition between them.  Matthew Corazzol’s desk was at the other end of the office.     
20. [20]
    Such was the relatively small size of the upstairs open plan office, that employees could be overheard having conversations with others.  The plaintiff’s evidence that there were many occasions when he heard Mr Corazzol while he was on the phone was corroborated by Ms Brumwell.  She explained that from her desk there had been occasions when she could clearly hear Mr Corazzol’s voice while speaking on the phone, particularly if he was raising it. 

The plaintiff’s work

21. [21]
    The plaintiff had a long career working with the defendant.  He initially worked for the company in internal sales between 1997 and 2003. He then left and worked for a competitor.  In 2005 he returned to work for the defendant, this time as the internal sales supervisor reporting to the general manager. It seems likely that it was Mr Corazzol who approached the plaintiff to return to work for the defendant, with the offer of the promotion. In addition to his salary, the plaintiff was offered $50 per week cash.  That was later increased to $250 per month. This practice of paying the plaintiff this cash component was stopped in mid-2018 on the advice of the defendant’s accountant and was instead incorporated into his salary.
22. [22]
    The internal sales teams comprised the plaintiff, Ms Brumwell and Matthew Corazzol.  They mainly worked in the office.  There were external sales staff as well.  They spent most of their time out of the office ‘on the road,’ visiting the stores the defendant supplied musical products to and attempting to generate new business.
23. [23]
    For many years the plaintiff had reported directly to the defendant’s general manager. This position became vacant in 2017 and was not filled.  This apparently had the consequence that Mr Corazzol became the plaintiff’s direct supervisor.  Some hesitation about this reporting structure is expressed because it seems that it was not formalised and Ms Hart was not aware of it, even though she was the office manager.^[4]  Indeed, she thought that part of her role was to manage the plaintiff.
24. [24]
    Mr Evans commenced working with the defendant in mid-2018.  The plan was that he would initially get to know the business by working as the service manager before being elevated to the role of general manager.  As time passed, there were discussions between Mr Evans and Mr Corazzol about Mr Evans instead transitioning to a newly created role of national sales director. This was not widely communicated to other employees prior to the meeting. The plaintiff had no knowledge of it.  As Mr Evans explained, he and Mr Corazzol were both “keeping that close to our chests”.^[5]  Mr Evans returned to the office from an international trade show on 30 January 2019.  On his return, he was told by Mr Corazzol that their previously discussed plan for him to take on the national sales manager role, would be effective from Monday 4 February 2019.  

Prior work performance

25. [25]
    The defendant did not have any systems in place to track the sales performance of the plaintiff.  There were no allocated budgets to be met and his salary did not include a commission component.  Further, the defendant did not conduct performance reviews and did not have any procedures in place to document performance concerns regarding employees.  According to Mr Corazzol, the defendant had “never been that sort of company” and that any such issues were dealt with “face to face”.^[6]
26. [26]
    It is pleaded in paragraph 10(c)(i) of the third further amended defence, that for approximately two years prior the meeting the plaintiff was aware that the defendant considered his work performance to be below standard. This is in circumstances where it is alleged that the plaintiff had been consistently asked whether he had completed tasks.  It is further asserted that the plaintiff had been requested to not take as many cigarette breaks and to not talk as much to other staff about his personal life.
27. [27]
    The preponderance of the evidence is that there may have been some occasional discussions with the plaintiff about issues relating to his work. Mr Corazzol did not give evidence about the content of these discussions.  It was the plaintiff’s evidence that there may have been the “odd word” from Mr Corazzol about him taking too many cigarette breaks and talking too much, including about personal matters unrelated to his work.   It was Ms Hart’s evidence that she had also spoken to the plaintiff about the frequency of his cigarette breaks.  She had also spoken to him if she was processing a sales order and noticed that some of the relevant information had not been inserted in the document, or if she noticed that the plaintiff had been late processing a monthly order. 
28. [28]
    It was Mr Corazzol’s evidence that there had been occasions where he had emailed the plaintiff to enquire of him as to whether he had placed the order for the ‘first of the month’. No such emails formed part of the evidence.  It was the plaintiff’s evidence that there would be occasions where Mr Corazzol would forward emails to the internal sales team, rather than to him personally.  It was the plaintiff’s impression that the issues raised in the emails were being more directed at Ms Brumwell and Matthew Corazzol and not himself.  He would be only carbon copied into them, rather than receive them as a primary recipient.  Mr Corazzol agreed in cross-examination that many of the emails he was referring to were directed at and forwarded to the internal sales team and not just the plaintiff.  The purpose of them was said to have been to motivate the team to be “more proactive in ringing dealers and stimulating business from within”^[7].  Ms Hart explained that “no one was ever singled out … unless they needed to be”^[8].
29. [29]
    I am satisfied that at no time did Mr Corazzol or anyone on behalf of the defendant, tell the plaintiff words to the effect that his work performance was below standard or raise issues with him where such an inference could be reasonably drawn.  Further, there were no performance concerns regarding the plaintiff that were clearly documented.  It follows that I am not persuaded that the plaintiff was aware the defendant considered his work performance to be below standard.

Knowledge of emotional issues

30. [30]
    The various medical records confirm that the plaintiff had a mental breakdown towards the end of 2013.  It was in the context of the dissolution of his second marriage.  He was working for the defendant at the time. There is a dispute about how much the defendant knew about this.
31. [31]
    The plaintiff’s leave records between 1 June 2013 and 31 January 2014 show that he took about 18 sick days in the second half of 2013. Five days of this were at the end of this period.  Ms Hart explained that such an extended period of sick leave would have required a medical certificate.  This has not been disclosed by the defendant.  The medical records from the Forest Lake Family Practice record the plaintiff received a medical certificate from Dr Kahawita on 9 December 2013.  At the time the plaintiff reported that he had become extremely depressed, had stopped eating and was unable to concentrate at work.  It is not known the extent to which the medical certificate detailed the plaintiff’s then mental health concerns.   Irrespective of this, it was well known by Mr Corazzol and others in the office that the plaintiff was struggling emotionally with the breakdown of his second marriage.  
32. [32]
    I am persuaded by the plaintiff’s evidence that there were occasions in 2014 when he would leave work early to attend an appointment with his treating psychiatrist.  It seems likely that the plaintiff would have disclosed, at least to his immediate supervisor (the then general manager), that the reason he was leaving early was to see his psychiatrist. This is because of his preparedness to be very open at work about his personal issues.
33. [33]
    The evidence establishes that over the years there were repeated occasions when the plaintiff had presented emotionally at work, with varying levels of distress displayed.  In a statement dated 9 May 2019, Mr Corazzol said that “the same emotional stressed personality has played out numerous times over the years”.  He further said that the plaintiff “has a personality which has stress, anxiety and depressive attributes”.^[9]  This was said to be in the context of personal issues.  The plaintiff’s emotional disposition was confirmed by other witnesses.  For example, in a document completed by Ms Hart in the context of this claim, she stated that the plaintiff “had always spoken very openly about his life’s struggles and stresses to anyone that would listen”.^[10]  Further, even in the relatively short period of time that Mr Evans had worked for the defendant, he had observed the plaintiff in the workplace to be upset and concerned about both personal and work related problems.
34. [34]
    In the weeks prior to the meeting, there was an occasion when the plaintiff was visibly distressed at work regarding some personal issues with his son having been caught speeding.  Mr Hart observed him to be crying.  He presented to Mr Corazzol’s office sobbing, hyperventilating and otherwise in clear distress.  This was not the only time that Mr Corazzol had seen the plaintiff so distressed that he was crying.^[11] 

The meeting

35. [35]
    The following matters are not in dispute:

    1. The meeting occurred not long before the close of business on Friday 1 February 2019.
    2. It was Mr Corazzol who initiated the meeting.  He telephoned the plaintiff and requested that the plaintiff come and see him in his office.
    3. In the telephone call, Mr Corazzol did not alert the plaintiff as to what the meeting was about.
    4. During the meeting:

1. (a)
   Mr Corazzol told the plaintiff words to the effect that:

1. (1)
   from the following Monday (being the next workday) he would no longer be the defendant’s internal sales supervisor; and

1. (2)
   fhis salary would be reduced by a few thousand dollars.

1. (b)
   The plaintiff asked for a job description of the demoted role he was going to be required to perform and was not provided with one.^[12]

36. [36]
    The precise timing of the meeting is in dispute.  It was the plaintiff’s evidence that he received the telephone call at approximately 4.30pm while he was sitting at his desk.  He finished off what he was doing and then walked the relatively short distance to Mr Corazzol’s desk.  On the other hand, it is pleaded in paragraph 5 of the third further amended defence that the meeting occurred at 4.55pm.   Little turns on this but to the extent that a finding is required, I consider it is likely that the meeting commenced somewhere between 4.30pm and 4.45pm.  This is in circumstances where Mr Corazzol typed an email after the meeting and forwarded it to the staff at 4.54pm.  It notified them of the new position of Mr Evans as the defendant’s national sales manager.^[13]
37. [37]
    It was the plaintiff’s evidence that during the meeting Mr Corazzol told him that his salary was to be reduced by $5,000.   Mr Corazzol gave evidence that he could not recall having any discussion with the plaintiff about a reduction in the plaintiff’s salary.  However, it is admitted in the defence that there was such a discussion, and that Mr Corazzol told him that the quantum of his salary reduction was $4,000.^[14]  In my view it is immaterial whether it was $4,000 or $5,000.   What is relevant is that the plaintiff was told that he was being stripped of his role as a supervisor, with a corresponding reduction in his salary of several thousand dollars.   To the extent that a finding is required, I prefer the evidence of the plaintiff. 
38. [38]
    There is also controversy as to the explanation provided by Mr Corazzol for demoting the plaintiff. It is the defendant’s case that Mr Corazzol told the plaintiff that for a significant period he had been unhappy with the plaintiff’s performance as the internal sales supervisor.^[15] Contrary to this, it was the plaintiff’s evidence that the concerns raised by Mr Corazzol were not directed to him personally, but rather to the internal sales team and the poor performance of the company more generally.  This seems more likely, particularly considering that prior to the meeting, Mr Corazzol had directed any concerns or suggestions to the internal sales team, rather than to the plaintiff personally.  
39. [39]
    According to Mr Corazzol, the only time the plaintiff spoke in the meeting was to tell Mr Corazzol that he agreed with what he was being told.  I do not accept this evidence as it is inconsistent with the undisputed facts in paragraph 35(iv)(b) above and it defies logic.  The plaintiff had been working for the defendant in this role for about 14 years and at no time had he previously been told that there were any significant issues with his work performance, or there was any other reason to consider demoting him.  Further, in the telephone call, Mr Corazzol had not alluded to why he was wanting to meet with the plaintiff. This meant that it was not until the meeting that the plaintiff learnt for the first time that he was being demoted, with a corresponding salary reduction.  Even at this point, the explanation for it was not directed personally at the plaintiff’s work performance.  When one considers this chronology, it is hardly surprising that the plaintiff was “utterly stunned” by the news of his demotion.  I accept the plaintiff’s evidence that he responded to Mr Corazzol by telling him that he could not do this as it was against the law.^[16]
40. [40]
    I am also persuaded that Mr Corazzol responded to the plaintiff by saying words to the effect that he could make this decision demoting the plaintiff and there was nothing the plaintiff could do about it.  This is because it accorded with Mr Corazzol’s views.  He had made the decision some weeks earlier but had delayed telling the plaintiff because of concerns about the stress the plaintiff was already under on account of the issues with his son.  Mr Evans had already been told that he was taking up his new position. As Mr Corazzol explained in cross examination, he had “quite firmly decided … what was going to happen” and he was prepared for what he needed to say and do.^[17]  
41. [41]
    It is pleaded in paragraph 6(e)(iv) of the amended statement of claim, that after Mr Corazzol told the plaintiff about his demotion and salary reduction that he then laughed at the plaintiff and asked him what he had to say for himself.  The defendant denies this.  I agree with the oral submissions of the parties to the effect that it does not seem necessary to resolve this factual dispute.  This is because it is not alleged that the plaintiff was humiliated and belittled, other than in the context of the confidentiality of the meeting not having been respected.
42. [42]
    As explained in paragraph 14 above, I do not accept Mr Corazzol’s evidence that he did not raise his voice during the meeting.  I prefer the plaintiff’s evidence about this.  In oral submissions, counsel for the defendant pointed to the fact that the plaintiff attended upon a general practitioner three days after the meeting, and the information recorded in the doctor’s notes does not refer to Mr Corazzol having raised his voice at the plaintiff during the meeting.   In my view, this is of limited assistance in resolving this factual dispute. The level of detail recorded in the entry is that which would be expected.  Medical records have their limitations in the context of litigation. They are generally short and made for the purpose of dealing with the presenting problem and recording the plan for the ongoing management of the presenting problem. Their purpose is not to provide comprehensive information of the circumstances surrounding an incident for a forensic analysis for examination later by a court.
43. [43]
    There are a few of reasons why Mr Corazzol may well have been inclined to raise his voice.  First, the profits of the business had been declining, which was no doubt causing Mr Corazzol to feel a level of stress. Second, I accept that Mr Corazzol had been frustrated with the plaintiff’s work performance (even though this had not been adequately articulated to the plaintiff).  Third, by the time of the meeting, Mr Corazzol had placed himself in a difficult position by having delayed telling the plaintiff about the restructure.  He did not have the time nor the inclination to deal with any resistance offered by the plaintiff and there was nothing the plaintiff could say that would change his mind.  This meant that the plaintiff’s expressed concern that the restructure plan was against the law was received by Mr Corazzol as an unwanted obstacle in implementing what he had already determined to do.  It only added to Mr Corazzol’s already heightened levels of stress and frustration.  As discussed in paragraph 13 above, this was not the first time Mr Corazzol had raised his voice at one of his staff.   
44. [44]
    The plaintiff returned to his desk and packed his bag. He said that he was fighting back tears.   While Ms Hart said that she was present in the upstairs office at this time and did not see Mr Evans approach the plaintiff’s desk, it is not in dispute on the pleadings that Mr Evans did this.  It is pleaded by the defendant that while speaking with the plaintiff at his desk, Mr Evans said that he was unaware that such a change was being made to the defendant’s staff structure.  Mr Evans could not recall saying this to the plaintiff.  There is no other evidence to support him having said it, and I am unconvinced that he did.  This is because to have told the plaintiff that he did not know that the restructure was going to happen would have been a deliberate untruth, and Mr Evans did not present as a witness who would conduct himself in such a dishonest way. It would have been untruthful because it was the evidence of Mr Evans that he was well aware of the restructure.  He and Mr Corazzol had been discussing it over some weeks, and he had been told only two days earlier that it would be happening effective from the following Monday.  
45. [45]
    I prefer the plaintiff’s evidence as to what Mr Evan’s said to him at his desk, namely words to the effect that he “didn’t know that was going to happen”.  Mr Evans also enquired of the plaintiff if he was alright. It is worth observing that when the plaintiff attended upon Dr Oo, psychiatrist in April 2022 he provided a consistent version as to this interaction with Mr Evans. It seems that the most likely explanation for Mr Evans having offered this support is that he had heard at least part of the meeting and had not known that the plaintiff was going to be informed of the restructure in the way that he was. 
46. [46]
    Accepting the above, it is not surprising that the plaintiff felt humiliated by what had transpired.  The meeting had occurred in an open plan office during work hours. It was reasonable for the plaintiff to have been concerned that at least part of it had been overheard by other employees.  His concern in this regard was confirmed following his conversation with Mr Evans.  Further, while he said in evidence that he did not know who was in the office at the time, his pleading is to the effect that there were others in the office, including those the plaintiff supervised.  This is consistent with the history he provided to Dr Oo, to the effect that there were two other co-workers present in the office.  The evidence establishes that these were Ms Hart and Matthew Corazzol.   To the extent that a finding is required, I am not only satisfied that prior to the meeting Ms Hart was aware that it was going to take place and the nature of it, but also that during the meeting she and Matthew Corazzol could at least hear their father’s raised voice.
47. [47]
    The plaintiff left work shortly after his brief conversation with Mr Evans. At the time, he was living with his adult son, Oliver.  He did not tell Oliver what had happened.  Oliver recalled noticing that the plaintiff was not himself and he was visibly upset.  The plaintiff had a job interview booked for that afternoon.  He was too upset to attend.   He did not do much over the following days.
48. [48]
    On 7 February 2019, the plaintiff and his then partner met Mr Evans and Ms Hart at a coffee shop in Forest Lake.  There is conflicting evidence as to who initiated this meeting, but nothing turns on it.  There is no dispute that the plaintiff was encouraged to return to work with the defendant. I am satisfied that the plaintiff was told that if he did, he would be reporting to Mr Evans and not Mr Corazzol.  After considering his position for some weeks, the plaintiff ultimately decided not to return to work with the defendant and his employment came to an end on 18 April 2019. 

Liability

Legal principles

49. [49]
    It is well established that an employer’s duty of care is not to provide a happy workplace, or to ensure that there is no conflict between employees, or that employees are always spoken to in a temperate way.^[18]  Rather, it involves an obligation to take all reasonable steps to provide a safe workplace and to take reasonable care and to avoid exposing the plaintiff to an unnecessary risk of injury whilst engaged in carrying out work in the defendant’s business.  This includes giving reasonable direction to an employee as to the way the employee shall perform work.^[19]  The duty extends as much to foreseeable risks of psychiatric harm as to physical harm.^[20]
50. [50]
    It remains necessary to identify the content of the duty said to have been owed. In determining this, the Court needs to consider the contractual obligations of the parties, applicable statutory provisions and any equitable obligations which could be enforced.  In this context, the matters the Court is required to have regard to include the compatibility of the duty sought to be imposed with other legal rights, and issues of coherency with other legal principles or statutory schemes.^[21]
51. [51]
    In New South Wales v Paige^[22], the Court of Appeal considered the scope of the duty of an employee to provide a safe system of work in the context of the employer’s decision to carry out an investigation under statutory provisions.  The relevant contractual right being exercised was a direction to work agreed work hours. The extension of a duty of care to such procedures for discipline and termination was rejected. This was because of the incompatibility of such a duty with two other areas of the law, namely judicial review of administrative action, and the law of contract as modified by statute with respect to wrongful dismissal under a contract of employment. 
52. [52]
    Paige was followed by the Queensland Court of Appeal in Govier v Uniting Church in Australia Property Trust (Q)^[23]. This is a case in which the decision to investigate a workplace incident involving two employees and a client, as well as the process of the investigation, were the subject of the claim. The allegations were found to relate to the employer’s exercise of its contractual rights to investigate the incident, and to make decisions about the plaintiff’s contract of employment.  This had the consequence that it was determined to be outside the scope of the duty of the employer to provide a safe system of work.
53. [53]
    Whether or not a duty of care arises is a question of fact.  There can be an overlap with facts informing the nature and scope of duty and whether there has been a breach. That is because the nature and scope of an employer’s duty may itself vary depending upon what the employer knows or should reasonably have foreseen regarding the employee in question. The nature and extent of steps an employer is required to take in exercising reasonable care to avoid injuries to employees may be broader in respect of a particular employee, where circumstances raise the foreseeability of psychiatric injury to that employee.
54. [54]
    In determining whether the risk of a plaintiff sustaining a recognisable psychiatric illness was reasonably foreseeable, in the sense that it was real and not insignificant, the focus is not upon the hypothetical person of normal fortitude, but rather upon the particular employee.^[24]  Foreseeability involves more than mere predictability.  However, it is limited by the consideration of reasonableness.  It requires the court to consider not only the interests of the plaintiff but also the burdens on the employer.^[25]  
55. [55]
    Each of the elements of s 305B(1) of the Act are to be judged from the viewpoint of the defendant, in the circumstances that were known, or ought to have been known at the time of the alleged injury.
56. [56]
    Evidence as to what notice the employer had that the employee in question was at risk of suffering psychiatric injury can be important.  One of the relevant factors is the express signs being exhibited by the employee.^[26]  It is not necessary for the employee to be suffering psychological symptoms for a psychiatric injury to be foreseeable.
57. [57]
    An employer is not to be judged as though it has psychiatric expertise.  What must be reasonably foreseen is “mental anguish of a kind that could give rise to a recognised psychiatric illness”.^[27] Distress, alarm, a sense of injustice, anxiety, unhappiness or despondency are not sufficient.
58. [58]
    Degrees of psychological stress and tension are inevitable incidents of the performance of an employee’s duties. Nearly all employees will be subject to some form of supervision and possibly correction in the workplace.  It is commonplace that situations may arise in the workplace where managerial decisions are made that adversely impact on an employee’s ambitions or perceptions of self.^[28]  It is therefore important that the focus on a test of reasonableness, is whether the particular circumstances of the case should be seen as having required intervention.^[29] 
59. [59]
    It is also necessary to consider the magnitude of the risk, the degree of probability that the risk of psychiatric injury may occur and the expense, difficulty and inconvenience of taking alleviating action and any other conflicting responsibilities which the defendant may have.^[30] This inquiry is prospective^[31] and is codified in s 305B(2) of the Act. 
60. [60]
    There are cases where an isolated instance of mistreatment of an employee can breach an employer’s duty of care.  This is particularly so if the alleged wrongful conduct, in the context of conduct of the type the employee was engaged to perform, involves senior staff, such as managing directors and the like.  This is because a differential in seniority, of itself, tends to increase the probability and thus foreseeability of psychiatric injury. It also makes it easier to infer the conduct was done in the course of employment and that the employer is vicariously liable for it.^[32]
61. [61]
    It must also be established that the failure to exercise due care caused or materially contributed to the psychiatric injury.  Factual causation is not proved merely because:

    1. the plaintiff was at work and there is a temporal relationship between the workplace and the onset of his psychiatric symptoms;
    2. there has been managerial mistreatment of a plaintiff increasing the risk of injury;
    3. a plaintiff can point to things that might have made a difference;
    4. the injury is the very kind of thing which is the subject of the duty; or
    5. the plaintiff attributes his compensation to the alleged cause.^[33] 
62. [62]
    The requirements to establish causation are set out in s 305D of the Act and are a restatement of the common law ‘but for’ test.  It is to be assessed as a matter of common sense and experience.^[34]  Pursuant to s 305E of the Act, the onus of proving any fact relevant to the issue of causation is on the plaintiff, applying the balance of probabilities test.

Analysis

63. [63]
    The defendant accepts that it owed to the plaintiff a duty to supply a safe system of work in relation to the conduct of tasks for which the plaintiff was engaged.  However, it denies that it owed the plaintiff a duty of care in relation to the meeting.  This is because in reliance on Paige and Govier, it is contended that at the time of the meeting the plaintiff was not performing tasks for which he had been engaged to perform.  It is said that the meeting instead related to the investigation of and decision making with respect to the incidents of the plaintiff’s contract of employment.  Further, in its written submissions, the defendant says that the matters about with the plaintiff claims may be relevant to an unfair dismissal/industrial relations type claim, such as that which he brought in the Fair Work Commission, for which another remedy is available.
64. [64]
    I am not persuaded by the defendant’s submission in this regard. There are several reasons for this.  First, while the contract of employment is not in evidence, it could hardly be said that the findings above as to the conduct of Mr Corazzol, was something to which the plaintiff had contractually agreed.  It did not otherwise involve the exercise of a contractual right.
65. [65]
    Second, this case is quite different from both Paige and Govier. Mr Corazzol’s conduct did not occur in the context of investigating or deciding complaints of unlawful conduct.  It was not undertaken as part of a disciplinary process.  Nor could the plaintiff’s performance be said to have warranted investigation.^[35] 
66. [66]
    Third, while the plaintiff made an application to the Fair Work Commission, it is unlikely that it would have been successful.  The reason for this is that I am not persuaded that the plaintiff was entitled to any form of relief for unfair dismissal pursuant to the Fair Work Act 2009.  This is because while Mr Corazzol’s approach to addressing the plaintiff’s performance issues may have been misguided, it was not sufficiently egregious that the plaintiff was entitled to treat his employment as at an end.  Indeed, this was not the plaintiff’s response to Mr Corazzol’s conduct.  He clearly considered he had options other than resigning.  When he met with Mr Evans and Ms Hart on 7 February 2019, he was encouraged to return to work, with Mr Evans as his direct supervisor.  The plaintiff did not outrightly reject this encouragement and some of the medical records confirm that he continued spending time thinking about his position.  For example, the plaintiff attended upon a general practitioner on 22 March 2019 and said that his boss was happy to continue paying him his original salary and he was considering his options.  It was not until he reattended upon the general practitioner on 26 March 2019, that the plaintiff said he was at the point where he had decided that he did not want to continue working for the defendant, as he felt his boss could be unpredictable.  There were ongoing negotiations with the defendant, and he did not end up resigning until 18 April 2019.  This was approximately two months after the meeting. The poor prospects of the plaintiff’s application to the Fair Work Commission may provide the explanation for the terms of settlement expressly stating that the application did not affect any claim the plaintiff may have had for a work-related injury.^[36]  The defendant has not identified any other issues of coherency with other statutory schemes.
67. [67]
    Fourth, the meeting did not concern the incidents of the contract of employment.  Rather, it was part of the ordinary course of employment. The conduct of Mr Corazzol occurred in the course of his employment by the defendant as the managing director, while purportedly carrying out the role of managing director. It supposedly related to the plaintiff’s performance in carrying out his duties in the workplace that he had been engaged to perform. Managing employees with an issue of this nature is usual in the workplace.  There is no inconsistency between the defendant’s common law duty to manage the plaintiff’s work performance and the duty of care alleged by the plaintiff.  This has the consequence that the general duties of care that apply to the workplace, applied here.
68. [68]
    In its written submissions, the defendant contends that even leaving aside the principles discussed in Paige and Govier, that no duty of care was owed by it to the plaintiff to avoid psychiatric injury.  This is on the contended basis that its knowledge as to the plaintiff’s emotional tendencies was not sufficient for it to think that the prospect of psychiatric injury was sufficiently significant and real to give rise to a risk that needed to be guarded against.  I do not agree. 
69. [69]
    There were clear signs that ought to have alerted Mr Corazzol to the plaintiff’s psychological vulnerability.  In the weeks prior to the meeting, the plaintiff had presented to his office in such a state that Mr Corazzol had observed him to be sobbing and hyperventilating.  This level of distress was such that it seems to have been an abnormal reaction to the plaintiff having learnt that his son had been caught speeding.  Such was Mr Corazzol’s concern about the plaintiff’s exhibited signs of obvious distress that he had delayed the meeting.^[37]   This is against a background of it being well known that the plaintiff was an emotional person who could “quite easily” become stressed and anxious.  As much is admitted in the defence.^[38] This admission is perhaps not surprising given the matters addressed in paragraphs 33 and 34 above. 
70. [70]
    Knowledge of the abovementioned matters bore inevitably upon the foreseeability of psychiatric injury. It is worth observing the fact that the previous occasions when the plaintiff had become stressed and anxious may have been attributed to personal rather than work issues does not assist the defendant.
71. [71]
    As is contended in the defendant’s submissions, Mr Corazzol was entitled to hold a meeting with the plaintiff regarding the performance of the company, proposed changes to its structure and its impact on the plaintiff.  However, this misses the point.  It goes without saying that demotion of a long-term employee is a serious matter and does not commonly occur.  It is inevitable that such news would be likely to cause any employee disappointment, unhappiness and distress.  Against the background knowledge of the plaintiff’s emotional tendencies, a reasonable person in the position of the defendant was on notice that if it did not properly address any perceived performance deficiencies on the part of the plaintiff before demoting him, the risk of him suffering a psychiatric injury was real and not insignificant. This resulted in a duty of care being owed and meant that the defendant was obliged to take all reasonable steps to avoid unnecessarily exposing the plaintiff to a risk of such an injury.  
72. [72]
    Despite this, at the meeting Mr Corazzol conveyed the singular position to the plaintiff that he was being demoted.  This was in circumstances where prior to the meeting, he had not raised any performance issues which could properly be used as a basis for this decision.  Then, the way Mr Corazzol framed the fact of the plaintiff’s demotion at the meeting, meant that he was not given any proper explanation for it, even at that late stage.  Nor was he given the opportunity to respond to the allegations supposedly justifying it.  Mr Corazzol had clearly abandoned any pretence of supporting the plaintiff or otherwise being concerned for his welfare.  It was my distinct impression that Mr Corazzol was much more concerned for his own self-interest in restructuring the business, with a view to increasing its profits.
73. [73]
    The defendant has accepted in its written submissions that if the meeting had been “held in the open”, it may well have been belittling and humiliating for the plaintiff.  It is said that the defining design feature of the upstairs office that ensured the confidentiality of the meeting was the presence of the head high partitions in front of Mr Corazzol’s desk area.  However, in my view their presence did not have this effect.  The meeting was held during ordinary work hours where it was to be expected that other staff would be in the office.  The floor space was not large.  As explained in paragraph 46 above, I am satisfied that at least part of what Mr Corazzol had to say was sufficiently loud that the plaintiff’s concern that it was audible to others was a well-founded one.  Further, the layout of the office was such that the plaintiff could easily be seen leaving there after the meeting in a shocked and upset state.  
74. [74]
    Even in the absence of the defendant’s knowledge of the plaintiff’s pre-existing psychological vulnerability, the abovementioned broader circumstances in which the meeting occurred and Mr Corazzol’s conduct at it, were sufficiently unreasonable as to bespeak the possibility of it causing psychiatric injury, even to an employee of normal fortitude. It was an inadequate and misguided approach to any sort of perceived performance issues. It would have been very distressing for any employee.
75. [75]
    Applying the principles in s 305B to this case, the probability of psychiatric injury was of such a degree that a reasonable person would have undoubtedly done more than what was done by the defendant to have avoided the risk of such an injury.  I accept the plaintiff’s submission that before the meeting, a reasonable person would have taken the precaution of providing the plaintiff with proper written notice of the specific concerns about his performance that would potentially justify taking the extraordinary step of demoting him.  A reasonable person would also have given the plaintiff a proper opportunity to respond to them prior to the meeting.  
76. [76]
    I also accept that a reasonable person would have ensured that any such conversation with the plaintiff was undertaken in a more confidential and calm manner.  This would be to reduce the risk that it may well be overhead by other employees, in the context of the open plan layout of the office.  
77. [77]
    It would be reasonable to expect that these precautions would be the standard responses of any competent manager when making a properly considered or credibly founded managerial decision to demote an employee.  This is regardless of whether they were concerned about a risk of psychiatric injury.   These steps were obvious in prospect, and they could have been easily undertaken.  There could be no suggestion that they involved any conflict with the defendant’s other responsibilities.  In these circumstances, the application of the principles in s 305B of the Act compels the conclusion that the defendant breached its duty. 
78. [78]
    The plaintiff also alleges that the defendant ought to have given him an opportunity to bring a support person to the meeting.  I accept that this would not have placed an undue burden on the defendant. The presence of such a person might have been thought by a reasonable person in the position of the defendant to have provided support to the plaintiff.  In this sense, I am persuaded that it was a breach of duty not to offer this to the plaintiff.
79. [79]
    For the above reasons, I am satisfied that Mr Corazzol breached his duty to take reasonable care to avoid psychiatric injury to the plaintiff.  By virtue of his standing as the defendant’s managing director, knowledge of the breach is imputed to the defendant.  It is also vicariously liable for Mr Corazzol’s conduct.  
80. [80]
    As to causation, it is my view that while the plaintiff had some pre-existing personality traits which may have made him more vulnerable to suffering the psychiatric injury, they were not causative of it.  Having said this, they remain relevant in identifying an appropriate discount for the vicissitudes of life in assessing quantum.  
81. [81]
    I am also not persuaded that had Mr Corazzol offered the plaintiff the opportunity to bring a support person to the meeting, that his psychiatric injury would probably have been averted.  This is because such support would not have taken away from the fact that he was being demoted with no proper notice of the purported basis for it, in a meeting that had the potential to be overhead by other employees.  Further, the purpose of the meeting was not to give the plaintiff an opportunity to answer any allegation that was being relied on to justify the demotion.  It was simply to inform him of Mr Corazzol’s decision to immediately demote him. The benefit of a support person in these circumstances would be questionable.  
82. [82]
    However, in my view but for the defendant’s other breaches of its duty of care as detailed in paragraphs 75 and 76 above, it is unlikely the plaintiff would have suffered a psychiatric injury. Those breaches were a necessary condition of the occurrence of the injury.  It follows the defendant is liable for the loss and damage occasioned to the plaintiff by its negligence.

Quantum

83. [83]
    The plaintiff was born on 13 March 1968.  He was 50 years of age at the time of the subject incident.  He is now 56 years of age.  He completed year 12.  He is a musician specialising in the guitar.  He has worked in the music industry for most of his career. 

Plaintiff’s mental health history

84. [84]
    As explained in paragraphs 30 and 31 above, towards the end of 2013 the plaintiff had a mental breakdown in the context of a marriage separation.  His mental state had deteriorated by the end of 2013 to the point that his parents had travelled from Maclean to help him.  His mother attended a medical appointment with him on 11 December 2023, at which time he was extremely depressed. He said that he could not go anywhere by himself and was overwhelmed with anxiety if he was to drive a car.  Around this time, he commenced seeing Dr Sue Splatt, psychiatrist.  He remained under her care for the following 12 or so months, with the frequency of attendances reducing over this time.  He said that he stopped seeing Dr Splatt as it was too costly.  It coincided with an improvement in his mental health. The plaintiff reported as much to Dr Kahawita when he attended at the Forest Lake Family Practice on 16 December 2014.  He said that he had come to terms with the end of his marriage and had started playing the guitar again. 
85. [85]
    The medical records confirm that over the next couple of years the plaintiff functioned relatively well.  He said in evidence though that he continued to have anxious moments, which he had learnt the skills to manage.  In August 2015, the plaintiff reported to Dr Kahawita that he was feeling fine.  He had started socialising again by the end of 2016.  In May 2016, the plaintiff was reporting stressors in the context of having commenced a new romantic relationship.  
86. [86]
    In 2018 the frequency of the plaintiff’s attendances upon general practitioners for mental health symptoms increased.   On 19 January 2018, he attended upon Dr Luu at the Forest Lake Family Practice and reported that he had been stressed about his father’s health and was not sleeping well. On 6 March 2018, he told Dr Luu that he had been stressed and anxious for a few weeks and that it was getting worse.  The stresses were noted to be from his boss bullying him at work and his son having moved out of home.  He was referred back to Dr Splatt.  On 30 June 2018, he told Dr Luu that while his anxiety and depression had improved, that he was mildly anxious.   When the plaintiff re-attended on 17 July 2018, he reported that it had recently been stressful for him.
87. [87]
    It was the plaintiff’s evidence that in the second half of 2018 he was able to manage, although he was experiencing constant underlying anxiety. He attended upon Dr Jaishankar at the Springfield Medical Centre on 19 October 2018.  He was clearly stressed at this time for personal and work-related reasons.  Relevantly, he reported ongoing problems with his boss and that he felt that he was having to do the work of his boss’s two sons.  He said that he was not coping and was conscious that he had been drinking too much.   The records reveal that he was certified not fit to work.  The duration of this is not known. 

General damages

88. [88]
    The plaintiff’s mental health deteriorated in the months following the meeting.  He felt that he was slipping back to where he had been following the breakdown of his second marriage.  He was anxious and had nightmares nightly for some three months. He struggled to sleep.  He felt ashamed and directionless. 
89. [89]
    This deterioration in the plaintiff’s mental health is confirmed in the Springfield Medical Centre records.  Three days after the meeting, the plaintiff reattended upon Dr Jaishankar and told him what had happened.  He further said that in the two previous years the defendant’s general manager, guitar products manager, and the administration assistant had resigned and not been replaced.  He also said that Mr Corazzol’s son worked there and was disabled and this had meant that he had to work even harder.  The plaintiff reported that he had not slept for two days, and he was planning on getting legal and fair work advice. 
90. [90]
    When next reviewed on 18 February 2019, Dr Jaishankar considered that the meeting had caused a significant aggravation to the plaintiff’s pre-existing worsening anxiety and depression.  The plaintiff reattended two days later and it was thought he required ongoing support.   When reviewed on 6 and 12 March 2019, the plaintiff reported that his stress was better but that his father was unwell. 
91. [91]
    The plaintiff was reviewed on 26 March 2019.  He said that he continued to feel anxious about his work issues.   He did not want to return to work because of the unpredictability of his boss.  He was also worried because his boss’s son had gone off work on sick leave.  He further said that his father remained unwell and his mother was struggling to cope.  He reported ongoing stress in an attendance on 15 April 2019.
92. [92]
    When reviewed on 28 May 2019, the plaintiff told Dr Jaishankar that his 18 year old son had almost been killed when working as an apprentice boiler maker.  He also told the doctor that his WorkCover claim had not been accepted after his boss provided a statement that gave an out of context version of events.  His claim was ultimately accepted a few weeks later.  
93. [93]
    On 1 July 2019, the plaintiff told Dr Jaishankar that there were multiple stressors in his life. He was experiencing nightmares.  His son was in hospital. His partner was requesting a more permanent relationship, and this was worrying him. 
94. [94]
    Around the end of July 2019, the plaintiff relocated to Maclean in New South Wales.  He moved in with his parents to assist them, as his father was becoming frail.  He said that this move was positive for him in the sense that it made him feel less anxious.
95. [95]
    Even though the plaintiff had relocated to Maclean, he continued attending upon Dr Jaishankar over the following nine months. He had ongoing stressors relating to his father’s health and the relationship with his partner.  While the plaintiff was looking for work, he told Dr Jaishankar on 5 November 2019 that he did not think he was ready for it. In early April 2020 he reported ongoing anxiety.  It was the plaintiff’s evidence that by 2020 his nightmares had abated and he had begun to feel better.  
96. [96]
    Dr Lucas Murphy psychiatrist for the defendant, assessed the plaintiff at the request of WorkCover on 18 August 2020 and 13 December 2023, and he has provided reports dated 28 August 2020, 17 January 2024 and 21 May 2024.  Further, Dr Murphy spoke with the plaintiff’s solicitor on 22 May 2024.  A file note of this conference has also been tendered.
97. [97]
    The plaintiff told Dr Murphy at the time of the assessment on 18 August 2020, that he began to experience symptoms of a panic attack during the meeting after he was told he was being demoted.  He said that this news was completely unexpected.  He further told Dr Murphy that his mental health spiralled down after this.  He started to experience more panic attacks that were accompanied by catastrophic thoughts.  He was reluctant to take medication because he had not found it helpful when he had been prescribed it between 2013 and 2015.  He tried to improve his mental health by arranging more support. He said he had moved in with his parents, begun seeking counselling from a religious minister and begun to involve himself in music again. 
98. [98]
    Dr Murphy considered that the plaintiff’s main ongoing symptoms were occasional vivid dreams and a feeling of mild panic sufficient to wake him at night.  It was Dr Murphy’s understanding that the plaintiff was engaging in a range of social, recreational and occupational activities.  He noted that the plaintiff was trying to improve his mental health through behavioural activation and self-management. 
99. [99]
    It was opined by Dr Murphy that the plaintiff had a pre-existing major depressive disorder and a panic disorder and that the subject incident had temporarily exacerbated his panic disorder.  However, Dr Murphy thought that by the time of this assessment, the plaintiff’s mental health was sufficiently good that he no longer met the criteria for a psychiatric diagnosis.
100. [100]
     The plaintiff commenced attending the Maclean Medical Centre on 2 August 2021.  He reported that his WorkCover claim had ceased in September 2020, and he was keen to apply for Centrelink on account of his anxiety.  Two weeks later, he was given a mental health care plan and referred to a psychologist.  His father passed away in August 2021 and he continued to live with his elderly mother to care for her. In November 2021, he told Dr Pye, general practitioner that he was not keen on taking medication or seeing a psychiatrist. 
101. [101]
     Dr Khine Oo, psychiatrist examined the plaintiff at the request of his solicitors on 14 April 2022 and she has provided a report dated 13 June 2022.  She also spoke with the plaintiff’s lawyers on 27 May 2024 and a file note of this conference has also been tendered.
102. [102]
     At the assessment on 14 April 2022, the plaintiff reported to Dr Oo that he had a panic attack after he arrived home from the meeting.  It lasted for about 15 minutes.  His symptoms included a racing heart, shakes, an overwhelming sense of doom, and difficulty breathing.  He experienced these panic attacks daily for the first few months, and these then lessened.  His most recent attack had been approximately two months earlier. He continued to experience daily anxiety, particularly when meeting new people or going to new places. He had taken up smoking again and was worrying excessively.  He had experienced ruminating and racing thoughts on waking of a morning.  The plaintiff also reported that he was drinking between two and five glasses of wine nightly and was smoking three or four joints daily.  He admitted having used alcohol and cannabis since 2007 and said they helped him with his anxiety.
103. [103]
     Dr Oo thought that prior to the work incident the plaintiff had suffered a major depressive disorder (which was in remission), a panic disorder (which was in remission), and a chronic fluctuating anxiety disorder. She considered that despite the plaintiff’s underlying vulnerabilities for psychological conditions, that his functioning had not been significantly affected by any psychiatric conditions prior to the meeting. Dr Oo opined that the subject work incident had exacerbated the plaintiff’s pre-existing panic disorder and generalised anxiety disorder. 
104. [104]
     On 6 July 2022, the plaintiff reattended at the Maclean Medical Centre. He reported increasing anxiety. He admitted significant smoking and cannabis use, as well as excessive alcohol consumption. 
105. [105]
     When the plaintiff was reassessed by Dr Murphy on 13 December 2023, the plaintiff said that while he was generally coping well in low-stress situations, he remained vulnerable to stress and even minor setbacks.  These were said to be causing protracted worrying and anxiety that he found difficult to manage.  They were also interfering with the plaintiff’s sleep, concentration, mood and self-confidence.   
106. [106]
     While Dr Murphy referred to having previously diagnosed the plaintiff as having suffered from an adjustment disorder in his earlier report, this is not correct.  Rather, as explained in paragraph 99 above, Dr Murphy’s previous diagnosis was an exacerbation of a panic disorder, which had resolved.  Dr Murphy thought the plaintiff’s symptoms had remained stable since his earlier assessment, and that while the plaintiff functioned well in low stress environments, he could become easily flustered, stressed and overwhelmed in the face of disappointments or setbacks.  Dr Murphy opined that the psychological scars from the work incident continued to interfere with the plaintiff’s confidence and ability to work and that he was suffering from an aggravation of his pre-existing panic disorder.  
107. [107]
     It was the plaintiff’s evidence that he continues to struggle with anxiety. He said that he can get worked up over the smallest things.  An example of this was catching the train into the city for the trial.   He also said that while he remained socially engaged, he felt most comfortable going out in the company of others. 
108. [108]
     I accept Dr Oo’s evidence that the plaintiff’s current work capacity (which is addressed below) suggests that his psychological symptoms have improved since her examination in April 2022.
109. [109]
     The general damages assessment process is regulated by the Act and the Workers’ Compensation and Rehabilitation Regulation 2014 (Qld) (‘the Regulation’). A court must make an assessment of the injury scale value (‘ISV’) of the relevant injury as determined by schedule 9 of the Regulation.  It is then required to calculate the damages pursuant to that ISV, in accordance with the formulae set out in the Regulation, as applied in the period when the relevant injury arose. The relevant ISV for mental disorders is determined by reference to a psychiatric impairment rating scale (‘PIRS’), as per schedules 10 and 11.  A medical expert report providing an assessment of a PIRS rating is required to state a variety of stipulated matters.
110. [110]
     The plaintiff claims $16,050 for general damages.  This equates to an ISV of 10, which falls within Item 12 of the Regulation.  This item is for a moderate mental disorder and has an ISV range of 2 to 10. It provides that this item is appropriate for a moderate impairment, where a mental disorder has a PIRS rating of between 4% and 10%.
111. [111]
     On the other hand, the defendant submits that an ISV of 1 is appropriate, which equates to a figure of $1,450.  This is on the basis that the plaintiff’s psychiatric injury is said to fall within Item 13, being a minor mental disorder with an ISV range of 0% to 1%.  An example of such an injury is one that results in little or no impact and has a PIRS rating of between 0% and 3%. It is further said, that at its highest, the ISV should be assessed to be at the lower end for a moderate mental disorder.  
112. [112]
     Dr Oo carried out PIRS assessments when she examined the plaintiff in April 2022.  The pre-injury assessment of 0% was based on the following:

1. (i)
   The plaintiff had no problems with:

1. (a)
   self-care and personal hygiene in the period between 2015 and the meeting;

1. (b)
   relationships;

1. (c)
   concentration; and

1. (d)
   full time employment.

1. (ii)
   While the plaintiff had experienced some residual anxiety when engaging in social and recreational activities, he was still able to play music, go to nightclubs and regularly catch up with family and friends.

1. (i)
   The plaintiff had experienced mild anxiety when driving but this had not adversely impacted on his ability to travel.

113. [113]
     As to subparagraph (i)(d) above, while the plaintiff continued to work full-time prior to the subject incident, I do not accept that she had no problems doing this.  As discussed in paragraphs 86 and 87 above, during 2018 the plaintiff had multiple attendances upon general practitioners for mental health symptoms.  They were sufficiently problematic in October 2018 for him to be certified unfit for work, albeit for a short period.   
114. [114]
     As to post-injury impairment, Dr Oo assessed 5% based on the plaintiff having reported that he:

     1. Did not have any motivation to do housework or cooking.
     2. Had been:

1. struggling with self-care and hygiene from the time of the meeting until approximately mid-2021; 
2. unable to manage living independently and had moved in with his parents; and
3. playing in a band since November 2021; 
4. catching up with family and friends and occasionally socialising beyond this; and
5. teaching guitar on a part-time basis since the beginning of 2021 and was engaging with an employment agency.

1. (iii)
   Was:

1. experiencing increased anxiety when driving or leaving the house and preferred to be accompanied by others.
2. not experiencing problems with concentration.

115. [115]
     As part of Dr Murphy’s examination on 13 December 2023, he too assessed a 5% post-injury impairment.  This was based on reports by the plaintiff that he:

     1. Was living independently and looking after himself well and was contributing to household cleaning and chores.
     2. Remained socially active, but less than previously. 
     3. Remained happy to see friends and family but had become less confident and more cautious.
     4. Had no problems with travel or his concentration.
     5. Could not return to work with the defendant but had been doing some part-time work as a guitar teacher and was in receipt of a disability support pension.
116. [116]
     Dr Murphy considered 4.5% of this impairment was related to the work incident, having deducted a 0.5% estimate for the plaintiff’s pre-existing impairment.  
117. [117]
     In his most recent report, Dr Murphy revised his PIRS assessment to 0%.  This was on the basis that the work incident resulted in the plaintiff suffering a temporary exacerbation (rather than an aggravation) of his pre-existing panic disorder.  I am not persuaded by this.  In my view, the plaintiff’s pre-existing psychological symptoms have been aggravated rather than exacerbated. This was Dr Oo’s opinion and was confirmed by Dr Murphy when he recently assessed the plaintiff in December last year.  He opined that at that time (being more than two years after the work incident), the plaintiff continued to have ongoing “psychological scars” from the work incident that were interfering with his self-confidence and ability to work.  The symptoms were such that Dr Murphy considered they were making event minor setbacks difficult for the plaintiff to manage and were interfering with his sleep, concentration and mood.  This is consistent with an aggravation rather than an exacerbation.^[39]
118. [118]
     It follows that I am also not persuaded that the aggravation of the plaintiff’s psychiatric condition consequent upon the work incident had resolved at the time of Dr Murphy’s first assessment. There are a few reasons for this.  First, Dr Murphy did not conduct a PIRS assessment at this time.  Second, it is apparent from Dr Murphy’s report that he was not given all relevant information.  It seems that Dr Murphy was not aware for example, that only months earlier the plaintiff was reporting ongoing anxiety to Dr Jaishankar.  Third, I accept Dr Oo’s evidence that if the plaintiff’s anxiety symptoms were not present at the time of Dr Murphy’s assessment in August 2020, that this may well be explained by the waxing and waning nature of these symptoms.  Fourth, I accept that ongoing psychological symptoms were present at the times of Dr Oo’s assessment in April 2022 and Dr Murphy’s assessment in December 2023. 
119. [119]
     The defendant has contended that the re-emergence of the plaintiff’s symptoms between Dr Murphy’s examination in August 2020 and Dr Oo’s assessment in April 2022 is explicable by the plaintiff’s excessive alcohol and cannabis use.   I do not accept this.  While the use of these substances seems to have been higher after Dr Murphy’s assessment compared to previously, the plaintiff had been drinking alcohol and using cannabis regularly since approximately 2007 (apart from a period around 2013 when he was being treated by Dr Splatt) and had been able to hold down a full-time job.  Such had been his ability to function, that he won the Australian Music Association’s best sales representative award for three consecutive years commencing in 2008.  It seems that the increase in his use of these substances is most likely explained as a mal-adaptive coping strategy for the plaintiff’s anxiety, in circumstances where he has been reluctant to use pharmacological alternatives.  I also do not accept the defendant’s further contention that the re-emergence and ongoing nature of the plaintiff’s symptoms is explicable by the death of the his father. 
120. [120]
     I am ultimately satisfied that as a result of the subject work incident, the plaintiff suffered an exacerbation of his pre-existing panic disorder (which has resolved) and an ongoing aggravation of his pre-existing anxiety disorder.  As explained in paragraph 108 above, I accept that the aggravation of his anxiety disorder has improved since Dr Oo’s assessment in April 2022 and is likely to continue to improve. In my view, an ISV of 3 is appropriate.  Schedule 12 of the Regulation produces a figure of $4,350.
121. [121]
     Section 306N(1) of the Act precludes payment of interest on general damages.  

Past economic loss  

122. [122]
     The plaintiff claims approximately $215,000 for past economic loss. It is comprised of net weekly compensation payments from WorkCover in the sum of approximately $70,000. The remaining $145,000 is based on a weekly allowance of $892 from when WorkCover payments ceased on 19 September 2020, less approximately $27,000 that the plaintiff has earned since he ceased employment with the defendant.  On the other hand, the defendant contends that the allowance for past economic loss should be limited to the $70,000 he has been paid by WorkCover.
123. [123]
     As to the approach to the assessment of economic loss, it is to compensate the plaintiff for loss of earning capacity. He must not only establish a diminution of earning capacity but also that the diminution is or may be productive of economic loss.^[40] 
124. [124]
     There is no dispute on the expert evidence that the plaintiff’s ongoing psychiatric injury precludes him from returning to work with the defendant.  This is irrespective of any other matters that may have impacted on his continued employment there.   This is against a background of having had a long history working there as a full-time employee in a supervisory capacity.  
125. [125]
     The parties are agreed that the plaintiff earned an average net weekly income of $795 in the 2015 financial year, $824 in the 2016 financial year, $816 in the 2017 financial year and $892 in the 2018 financial year.  It is further agreed that he continued earning this same average net weekly income in the 2019 financial year prior to the meeting.  While he did not return to work for the defendant after this time, his salary was reduced to $842 net per week between 1 April 2019 and when he ceased his employment with the defendant on 18 April 2019.  
126. [126]
     The increase in the plaintiff’s net weekly income is highest between the 2017 and 2018 financial years and is in the order of $76.  The explanation for this seems to be that the small cash component which the plaintiff had been previously receiving, was incorporated into his salary.
127. [127]
     The plaintiff did not return to any form of work prior to relocating to live with his parents in Maclean at the end of July 2019.  He initially assisted his parents around the home, while dealing with his mental health issues.  In August 2019, WorkCover assisted him to apply for a job at the Grafton City Council which he did not get.  He told Dr Jaishankar on 5 November 2019 that he still did not think he was well enough to return to work.
128. [128]
     In late 2019, the plaintiff was offered some casual work at the Maclean Music Academy teaching the guitar.  While he was interested, COVID prevented him from immediately commencing with this.  By the time the plaintiff saw Dr Murphy in August 2020, he had begun this teaching work for two hours per week.  He had also set up a guitar workshop in his shed, with the idea of repairing guitars. 
129. [129]
     In December last year, the plaintiff told Dr Murphy that his work had increased to 15 hours per fortnight as a guitar teacher.  He had also started a rock band at the local primary school.  In addition, he was studying a Certificate III in Individual Support and his ambition is to help disabled children through music.   I understand that this qualification will also enable him to work in aged care.  
130. [130]
     I am satisfied that on account of the plaintiff’s ongoing mental health symptoms, that he is likely to be limited to part-time work in a low-stress environment.  
131. [131]
     It is agreed by the parties that since the plaintiff ceased employment with the defendant in April 2019, he has earned an average net weekly income of $16 in the 2020 financial year, $98 in the 2021financial year, $83 in the 2022 financial year, $155 in the 2023 financial year and $183 in the current financial year, up until 30 April 2024.
132. [132]
     I have assumed that since the WorkCover payments ceased in September 2020, but for the plaintiff’s psychiatric injury, that he could have continued earning an average net weekly income of approximately $900.  This results in a loss of $33,685 in the 2021 financial year (from when WorkCover payments ceased), $42,485 in the 2022 financial year, $38,740 in the 2023 financial year, $37,287 in the 2024 financial year and $2,900 in the current financial year to date.  This equates to a total loss of approximately $155,000. 
133. [133]
     The discount, if any, to be applied to an award for economic loss in the past involves considerations that are different to those that are appropriate for the future.^[41]  The principal reason for this is that the past is more certain than the future.  
134. [134]
     In my view it is appropriate to apply a 25% discount, resulting in a figure of approximately $116,000.  I am mindful that a lower percentage (if any) is often but not always adopted by the courts.   The reason why there is no such uniform approach, is because it is inevitable that the factual significance of positive and adverse vicissitudes will vary from case to case.   In my view, the degree of discounting warranted here on account of the adverse contingencies is greater for the following reasons:

     1. As discussed in paragraph 11 above, prior to the meeting the plaintiff had not been enjoying working for the defendant, had commenced exploring other employment opportunities and had accepted a second interview with another company.
     2. The plaintiff was complaining of psychological symptoms prior to the meeting, which had interfered with is his capacity to work, at least to some extent.^[42]
     3. Even if the demotion had been managed appropriately by Mr Corazzol, the plaintiff may have:

1. still developed a psychiatric injury; or
2. been so disappointed and dissatisfied with the outcome that he would have left his employment with the defendant.  

1. (iii)
   The plaintiff’s parents were in need of practical assistance around the home and it is possible that he would have relocated to Maclean to provide this assistance.  Given the somewhat specialised nature of the plaintiff’s work in sales in the music industry, there may well have been limited opportunities for him to obtain full-time employment in a place the size of Maclean.

135. [135]
     As to subparagraph (iii)(b) above, I am mindful that the plaintiff may have continued working for the defendant in the absence of the subject incident.  This is because the effect of the restructure was that Mr Evans was to become the plaintiff’s direct supervisor.  The plaintiff liked and respected Mr Evans and may have been persuaded to remain working under him. 
136. [136]
     In relation to subparagraph (iv) above, in my view had the plaintiff’s demotion been managed appropriately, there is significant uncertainty around the likelihood of him having relocated to Maclean.  This is in circumstances where he was in full time employment and had at least one other potential opportunity for full-time employment in and around Brisbane.   This conclusion is arrived at cognisant of the plaintiff’s evidence in cross-examination to the effect that he would need to have been made the national sales manager if he was to remain working for the defendant.
137. [137]
     For the above reasons, the total allowance for past economic loss is approximately $190,000.

Interest on past economic loss

138. [138]
     The plaintiff has received approximately $69,761.23 from WorkCover by way of net weekly compensation. These payments ceased on 19 September 2020.  Therefore, interest should be awarded on the shortfall of $116,000, from this time.  This a period of 3.92 years at a rate of 2.16%.  The resulting figure is approximately $9,820.

Fox v Wood

139. [139]
     The Fox v Wood component is agreed at $20,028. 

Past loss of superannuation

140. [140]
     The parties agree that the appropriate rate is 10%.  In these circumstances, the allowance for loss of past superannuation is $18,600.

Future economic loss

141. [141]
     The plaintiff claims approximately $180,000 for future economic loss.  This is based on an ongoing net weekly loss of $446 per week until age 67, less 10 percent for contingencies.  It is the defendant’s case that any award should be limited to a modest global sum, of not more than $20,000.
142. [142]
     In determining the appropriate allowance for future economic loss, it is necessary to consider what would have happened to the plaintiff had he not been injured and what will happen now.^[43] It is unnecessary for the plaintiff to establish that his injury will be productive of financial loss.  It is sufficient to prove that there is a chance of that loss occurring and the extent of the compensation depends on the degree of the chance.^[44]
143. [143]
     In evidence, the plaintiff explained that as part of the Certificate III course, he had recently completed 120 hours of work placement in the local primary school, attending there on Mondays and Fridays working six hours each day.  He said that while he continues to feel anxious about the thought of going to the school, he finds that he is fine once he gets there.   He further said that the school principal has been very happy with him and there have been discussions about him commencing work there as a teacher aide working the same hours.
144. [144]
     Dr Oo considered that the plaintiff is not able to return to his previous role in sales and is fit to work up to 20 hours per week in other suitable occupations, provided they are not too demanding.  She thought that his obstacles to work are his anxiety, panic attacks, low confidence, irritability and lack of motivation.  The plaintiff said to Dr Oo that “after putting 20 years into a job that I love and being treated that way, I don’t want to be in that position ever again.”.  Dr Murphy agreed that the plaintiff appeared to be limited to part-time work in a low-stress environment.^[45]  
145. [145]
     I am satisfied that the plaintiff’s future, in both his injured and uninjured state, probably lies in the music industry.  Having said this, it cannot be overlooked that his ongoing symptoms mean that the range of other occupations open to him may have been reduced, making it more difficult for him to find employment on the open labour market.
146. [146]
     There are many imponderables in assessing the probable loss moving forward. At one extreme is the possibility that the plaintiff will not return to working any more hours than he currently is.  At another extreme is the contingency that his symptoms will resolve at the conclusion of the litigation, and that he will return to work full time and in a supervisory capacity. These and other more probable contingencies must be considered.
147. [147]
     Having regard to the nature of the plaintiff’s ongoing residual symptoms, his age, his work history and the fact that he has sustained a psychiatric injury attracting an ISV of 3, I assess his loss at $450 per week until age 67, being a period of eleven years.  Applying the 5% tables, results in a figure of approximately $200,000.  I have adopted a discount of 35% for the following reasons:

     1. The matters referred to in paragraph 134 above.
     2. There has been an improvement in the plaintiff’s symptoms since Dr Oo’s assessment in April 2022, and there is a significant chance that the plaintiff’s symptoms will continue to improve with the finalisation of the litigation. 
148. [148]
     Applying a 35% discount results in an allowance for future economic loss of approximately $130,000.

Future loss of superannuation

149. [149]
     The parties are agreed that the appropriate rate is 11.3%.  This gives a figure of $14,690. 

Special damages

150. [150]
     WorkCover expenses amount to $4,778.89. The parties are agreed as to an additional $2,500 for out-of-pocket expenses, the Medicare refund and interest. 

Future out of pocket expenses

151. [151]
     The plaintiff claims a total of approximately $20,000 for future expenses. This is for psychological treatment comprising 26 sessions annually over a three year period.  This is based on the recommendation of Dr Oo.  The defendant contends there is no basis for making any award for this head of damage.    
152. [152]
     Dr Oo considered that the plaintiff would benefit from seeing a psychologist and a psychiatrist to reduce his symptoms and the risk of a future relapse.  She noted that he was not open to considering pharmacological treatment. 
153. [153]
     It seems that the plaintiff has attended upon a psychologist on only three occasions since the work incident.  He told Dr Oo that he had stopped going as he could not afford it and did not think he was learning anything new.  He further told Dr Oo that he had recently ascertained that he could see a bulk-billing psychologist via tele-link and that he was planning to get a referral from his general practitioner.  There is no evidence that the plaintiff has taken any steps over the last two years to facilitate such further treatment.  It is worth observing that the plaintiff has previously expressed a preference for using his music as a form of therapy.
154. [154]
     In my view, it is appropriate to make a global allowance of $5,000 for future-out-of-pocket expenses, for intermittent attendances upon medical practitioners for management of his ongoing symptoms.

Summary of damages award

Orders

155. [155]
     There will be judgment for the plaintiff against the defendant for $395,767.
156. [156]
     I direct that any submissions in respect of costs (not to be longer than four pages) or alternatively a proposed draft order if the parties are agreed, be filed within seven days.