COMMISSIONER OF POLICE V ROBERT CRAIG HAWKINS CA CA212/2008

COMMISSIONER OF POLICE V ROBERT CRAIG HAWKINS CA CA212/2008 9 July 2008IN THE COURT OF APPEAL OF NEW ZEALAND CA212/2008 [2008] NZCA 219BETWEEN COMMISSIONER OF POLICE Applicant AND ROBERT CRAIG HAWKINS Respondent Hearing: 16 June 2008 Court: O'Regan, Arnold and Baragwanath JJ Counsel: J C Holden for Applicant C P Brosnahan for Respondent Judgment: 9 July 2008 at 12.30 pmJUDGMENT OF THE COURT A The application for leave to appeal is granted with regard to the following questions: (a) Was it open to the Court to reinstate Mr Hawkins, given that he had previously disengaged on medical grounds under s 28D of the Police Act 1958? (b) Did the fact that the respondent disengaged under s 28D of the Police Act 1958 preclude the making of an award for loss of income to the respondent? (c) Was the Court's award for compensation under s 123(1)(c)(i) of the Employment Relations Act 2000 excessive, given the decision of this Court in NCR (NZ) Corporation Ltd v Blowes [2005] 1 ERNZ 932?B We reserve the question as to whether leave should be granted on the following question for further argument at the substantive hearing: Was it open to the Court to reinstate Mr Hawkins given that nearly seven years had passed since his departure from the police which was found to be constructive dismissal? C The application is otherwise declined. D There are no costs orders. REASONS OF THE COURT(Given by O'Regan J)Introduction[1] This is an application by the Commissioner of Police for leave to appeal against a judgment of Judge Shaw in the Employment Court (EmpC WN WC7-08 27 March 2008). That judgment dealt with the remedies to be awarded to Mr Hawkins as a result of a finding in an earlier judgment of Judge Shaw that he had been constructively and unjustifiably dismissed from his employment as a police officer (EmpC WN WC29-07 30 November 2007). We will call the March 2008 judgment the "remedies judgment" and the November 2007 judgment the "liability judgment".Leave already granted[2] This Court recently granted leave to the Commissioner to appeal to this Court against the liability decision on three questions: [2008] NZCA 164. The three questions are: (a) Does s 114(1) of the Employment Relations Act 2000 require the employer to have turned its mind to the 90 day period [within which grievance proceedings must be commenced] and agree (expressly or impliedly) to proceed [notwithstanding failure to comply with that time limit]? (b) Does consent have to be pleaded by the employee? (c) Can a voluntary disengagement under s 28D of the Police Act 1958 be reversed by way of a personal grievance?Present application[3] The present application for leave to appeal against the remedies judgment of Judge Shaw is obviously closely allied to the earlier application to appeal against the liability judgment. [4] In the remedies judgment, Judge Shaw ordered that Mr Hawkins be reinstated to his former position in the police, or to a role no less advantageous to him. She rejected the Commissioner's argument that this would not be practical in light of the seven years which had elapsed since the termination of his employment and that it should not be ordered because Mr Hawkins had voluntarily disengaged under s 28D of the Police Act. Judge Shaw also ordered that Mr Hawkins was entitled to payment of a sum representing his loss of remuneration from 17 September 2003 until the date of his reinstatement, calculated on the basis of a salary which a sergeant would have earned during that period. She directed that the Commissioner pay $35,000 as compensation to Mr Hawkins under s 123(1)(c)(i) of the Employment Relations Act 2000. She also ordered that the Commissioner pay costsof $56,000 plus GST to Mr Hawkins (being 66 per cent of his costs) and pay $21,532.50 towards a disbursement incurred by Mr Hawkins for work undertaken by a friend of Mr Hawkins, Mr Bass, in relation to the personal grievance claim.Grounds for which leave is sought[5] The Commissioner seeks leave to appeal on the following questions: (a) Was it open to the Court to reinstate Mr Hawkins at the rank of sergeant to supervise operational police members after nearly seven years, given that he had disengaged on medical grounds and has suffered intervening psychological illness and unfitness to discharge duties? (b) Was it open to the Court to make the award for loss of income, given the respondent's delay in raising and/or pursuing his personal grievance and his not seeking reinstatement before 18 September 2003? (c) Was the Court's award for compensation under s 123(1)(c)(i) of the Employment Relations Act excessive in the circumstances? (d) Was the Court wrong in its approach to contribution which led it to reject the contributing factors that the Commissioner says should result in reduction of remedies due to the respondent: (i) was it a reasonable possibility that, if the respondent had disclosed that the pending criminal charges were a reason for his application to disengage, he may have remained in employment? (ii) did the Court's finding that "the prospect of the criminal charges being laid would not necessarily have led him to seek to disengage" adequately address the applicant's submissionthat there should be at least some reduction of remedies for contribution? (e) Was Mr Bass' 6 December 2007 invoice to the respondent recoverable from the applicant as a disbursement? [6] We will deal with each of these in turn.Factual background[7] The factual background is set out in this Court's earlier judgment, [2008] NZCA 164. We do not need to repeat it here.Statutory criteria for the grant of leave[8] Leave to appeal may be granted only if, in this Court's opinion, a question of law involved in the proposed appeal, by reason of its general or public importance or for any other reason, ought to be submitted to this Court for decision: s 214(3) of the Employment Relations Act. In Carter Holt Harvey Ltd v Yukich CA42/04 28 April 2004 this Court said (at [12]):It is sufficient for present purposes to note that a question of law arises if (1) The Employment Court has misdirected itself in the law or misunderstood or misapplied the law; (2) The decision has been made without any evidence to support it; or (3) The decision offends reason or is one to which the Court could not reasonably have come to (i.e., it is perverse in a legal sense).Reinstatement[9] Ms Holden accepted that the first question (see [4](a) above) is really two separate questions, namely:(a) Was it open to the Court to reinstate Mr Hawkins, given that he had previously disengaged on medical grounds under s 28D of the Police Act? (b) Was it open to the Court to reinstate Mr Hawkins given that nearly seven years had passed since his departure from the police which was found to be constructive dismissal? [10] Counsel were agreed that, given the third question for which leave has already been granted (see [2](c) above), leave should be granted on the question in [9](a) above. We agree that this meets the criteria for the granting of leave. [11] The question in [9](b) above is more problematic, however. Section 125(2) of the Employment Relations Act provides that the Employment Relations Authority (and, in this case, the Employment Court) must provide for reinstatement "wherever practicable" in cases where it finds that an employee had a personal grievance and the employee seeks reinstatement. Judge Shaw found that it was practicable to reinstate Mr Hawkins to a supervisory role at Taumarunui police station notwithstanding his seven year absence from the police and the fact that the events leading to his personal grievance had arisen in that station. In essence, Ms Holden's argument was that it was not open to Judge Shaw to find that it was practicable to reinstate Mr Hawkins on the facts of this case: such a conclusion was irrational. [12] The finding which the Commissioner seeks to challenge is essentially factual, and therefore not an obvious candidate for the granting of leave, given the restrictions of s 214: see [8] above. In its decision in Bryson v Three Foot Six Ltd[2005] 3 NZLR 721 at [25], the Supreme Court made it clear that this Court could not intervene where the Employment Court had engaged in a fact finding exercise which had involved the application of the law which it had correctly understood to the facts of the case. However, as this Court did in Yukich, the Supreme Court acknowledged an exception. The Court said at [26]:An ultimate conclusion of a fact-finding body can sometimes be so insupportable – so clearly untenable – as to amount to an error of law: proper application of the law requires a different answer.[13] Ms Holden's argument appears to be that this is such a case. It is notable that the Supreme Court rejected in Bryson an argument that the conclusion reached by the Employment Court in that case was one which no reasonable judge could have reached. [14] It is clear from the Supreme Court's judgment in Bryson that it will only be in rare cases that an argument that a finding is irrational or untenable will be made out. In the present case, Ms Holden emphasised the fact that the length of Mr Hawkins' absence from the police was about three years greater than the period in the case on which Judge Shaw relied as a precedent. [15] We have some doubt that this question meets the test for the granting of leave, but we acknowledge that this is a very unusual case, and that the Commissioner may be able to establish a point of law in the terms outlined above if given the opportunity to mount a full argument with a detailed review of the facts, rather than the truncated argument permitted at a leave hearing. We also acknowledge that there is some overlap between this question and the question for which we have given leave to appeal ([9](a) above). We therefore propose to reserve the question as to whether leave should be given on this ground for the main hearing, at which both the question of leave and, if leave is given, the merits, can be considered.Compensation for loss of income[16] The question for which leave is sought under this head ([4](b) above) does not appear to represent correctly the point which the Commissioner seeks to put before the Court. Ms Holden said the point which the Commissioner wishes to argue is that the statutory medical disengagement under s 28D precludes an award for loss of income as Mr Hawkins did not make any claim based on ongoing medical incapacity. That point also follows on from the third question for which leave was given in this Court's judgment of 12 June 2008 ([2](c) above) and the question set out in [9](a) above because it is also linked to the question of law arising from the impact of a voluntary disengagement under s 28D on a subsequent claim for unjustified dismissal. We consider it is appropriate to grant leave for this question,but we see the point as substantially depending on the outcome of the Court's decision on the two questions mentioned earlier in this paragraph. The question for which we give leave is: Did the fact that the respondent disengaged under s 28D of the Police Act 1958 preclude the making of an award for loss of income to the respondent?Compensation[17] Judge Shaw awarded compensation to Mr Hawkins for hurt and humiliation of $35,000. The question on which the Commissioner seeks leave is whether that award was excessive. In general terms that is not a question of law, but Ms Holden argued that leave should be given because not only was the award manifestly excessive, but Judge Shaw had misdirected herself with respect to this Court's decision in NCR (NZ) Corporation Ltd v Blowes [2005] 1 ERNZ 932. [18] Judge Shaw dealt with the matter this way (at [33]):The assessment of compensation for hurt and humiliation is necessarily an inexact science. Section 123 of the Employment Relations Act 2000 confers an unrestricted discretion to award such compensation and the cases reveal a wide range of awards because of necessity that they are facts specific.While awards must be in accord with principle, any concept that such awards should fall within a permissible range such as that stipulated inNCR (NZ) Corporation Ltd v Blowes is not in accord with statutory discretion. [Emphasis added.][19] Judge Shaw's dismissal of this Court's decision in NCR as "not being in accord with statutory discretion" appears to overlook the fact that decisions of this Court are binding on the Employment Court. In our view, it is arguable that she erred in law in not following that decision, and we therefore grant leave on this question, though we modify it from the general wording proposed by Ms Holden so that it reads: Was the Court's award for compensation under s 123(1)(c)(i) of the Employment Relations Act excessive, given the decision of this Court in NCR (NZ) Corporation Ltd v Blowes [2005] 1 ERNZ 932?Contribution[20] The issues which the Commission seeks to raise under this heading ([4](d) above) are factual issues which are not amenable to appeal to this Court. We decline leave on this question.Mr Bass's invoice[21] The Judge awarded costs to Mr Hawkins equal to two-thirds of his actual costs. She also ordered payment (as a disbursement) of an invoice for work undertaken by Mr Bass, who is a friend of Mr Hawkins and who assisted in the preparation of Mr Hawkins' case in the Employment Court. (She reduced the amount invoiced to exclude the fee for work not associated with Mr Hawkins' claim.) It appears that Mr Bass did not render an account for his costs until after the liability judgment was delivered, i.e. the result of the case was known. The Commissioner wishes to argue that the work under taken by Mr Bass was essentially legal work (briefing witnesses, research, disclosure, and the like) and should therefore have been treated as part of the costs (which means only two-thirds would be awarded). We do not see this essentially factual matter as being an appropriate question for leave. There is no proper evidential basis for the argument which the Commissioner seeks to make, and in any event it has no importance other than to the parties to the present case. The amount involved is relatively trivial. We decline leave on this ground.Result[22] These are the reasons for the determinations set out above.Costs[23] The Commissioner has been partly successful in this leave application. In the circumstances we direct that costs should lie where they fall.Joint hearing[24] The parties agreed that the appeals against the liability judgment and against the remedies judgment should be heard together. We agree. We ask that the Registrar allocate a single fixture for both appeals.Solicitors: Crown Law Office, Wellington for Applicant Debbie Goodlet, Wanganui for Respondent