Supreme Court New South Wales

• Medium Neutral Citation: Bartlett v Australia and New Zealand Banking Group Limited [2014] NSWSC 1662
• Hearing dates: 10, 11, 12, 13 and 14 November 2014
• Decision date: 24 November 2014
• Jurisdiction: Common Law
• Before: Adamson J

Decision

1. Judgment for the defendant.

2. Unless either party makes an application in writing to my Associate within seven days, order the plaintiff to pay the defendant's costs of the proceedings.

• Catchwords: CONTRACTS - alleged serious misconduct - sending of doctored internal ANZ email to journalist - interpretation of termination clause - whether entitlement to terminate arises if ANZ holds opinion that plaintiff guilty of serious misconduct or only if underlying fact established - onus of proof - terms sought to be implied inconsistent with express terms - ANZ established entitlement to terminate because of its opinion that the plaintiff had sent the doctored email - ANZ further established underlying fact - excluded all other reasonable suspects; DAMAGES - findings made for completeness - had summary dismissal not been available ANZ would have been entitled to terminate by paying four months' remuneration in lieu of notice and would have done so - ANZ no longer trusted plaintiff and would have terminated employment
• Cases Cited: Australian Workers' Union v Bowen (No. 2) (1948) 77 CLR 601; Blyth Chemicals Ltd v Bushnell (1933) 49 CLR 66; B.P. Refinery (Westernport) Pty Limited v Hastings Shire Council (1977) 180 CLR 266; Briginshaw v Briginshaw (1938) 60 CLR 336; Codelfa Construction Pty Limited v State Rail Authority of NSW [1982] HCA 24; 149 CLR 337; Commonwealth Bank of Australia v Barker [2014] HCA 32; Interstar Wholesale Finance Pty Ltd v Integral Home Loans Pty Limited [2008] NSWCA 310; 257 ALR 292; Maredelanto Compania Naviera SA v Bergbau-Handel GmbH; The Mihalis Angelos [1971] 1 QB 164; North v Television Corporation Ltd (1976) 11 ALR 599; Pastrycooks Union v Gartrell White (No. 3) (1990) 35 IR 70; Silverbrook Research Pty Limited v Lindley [2010] NSWCA 357; TCN Channel 9 Pty Limited v Hayden Enterprises Pty Ltd (1989) 16 NSWLR 130; The Commonwealth v Amman Aviation Pty Limited (1991) 174 CLR 64; Whitehouse Hotels Pty Limited v Lido Sovay Pty Limited (1975) 49 ALJR 93
• Texts Cited: Wilson R Harrison, Suspect Documents - their scientific examination, (1966, Sweet & Maxwell London)
• Category: Principal judgment
• Parties: Paul William Bartlett (Plaintiff); Australian and New Zealand Banking Group Limited (Defendant)
• Representation: Counsel: J Fernon SC/D Chin (Plaintiff); C Murdoch (Defendant); Solicitors: Wilshire Webb Staunton Beattie (Plaintiff); Ashurst Australia (Defendant)
• File Number(s): 2012/351555
• Publication restriction: Nil

Judgment

Introduction

1 On 15 August 2012 the defendant (the ANZ) purported to terminate the plaintiff's employment without notice on the basis of serious misconduct. The plaintiff, Paul Bartlett, was then the Director of the ANZ's Institutional Property Group (IPG) for New South Wales.

2 By statement of claim filed on 12 November 2012, the plaintiff sued the ANZ for damages for breach of contract alleging that he was not guilty of serious misconduct and, accordingly, that the ANZ was not entitled to terminate his employment without notice. He claimed damages in the order of $9m, in respect of lost remuneration and bonuses, calculated on the basis that he would have worked for the ANZ for a further ten years to 15 August 2022. The ANZ defended the proceedings on the basis that it had a right to terminate the plaintiff's contract summarily. It contended, in the alternative, that the plaintiff's damages were limited to $74,495, being the net amount of four months' remuneration since it was entitled under cl 14.3(a) to terminate his employment without cause and pay him four months' salary in lieu of notice. The ANZ submitted that this was what would have occurred, had summary dismissal under cl 14.3(b) not been available.

3 The most significant issue in the proceedings was whether the plaintiff was, as the ANZ contended, responsible for sending a doctored email to Matthew Cranston, a journalist based in Brisbane who wrote for the Australian Financial Review (AFR). The plaintiff has, at all times, denied that he was the culprit. However, Mr Fernon SC, who appeared with Mr Chin on his behalf, accepted that, if ANZ proved that the plaintiff had sent the doctored email, it was entitled to terminate his employment without notice since such conduct would amount to serious misconduct within the meaning of clause 14.3(b) of his contract of employment, the terms of which are addressed in more detail below.

Facts

The email of 20 June 2012: the true email

4 At 1.12 pm Eastern Standard Time on 20 June 2012, Eddie Law, the Head of the ANZ's Institutional Property Group (IPG) sent an email to the State Directors and Heads of Research Analysis in IPG: the plaintiff, Matthew Lawrence , Adrian Blake, Duncan Caldwell, Steven Wiltshire, Mark Sample, Chris Rees and Adam Cotterell. The email was also copied electronically to two executive assistants (EAs): Nicole Khalife, who worked for Mr Law, and Fiona Martinez, who was directly associated with the plaintiff and Mr Sample but who also performed work for others. The email set out various matters germane to the ANZ's policies for the balance of the financial year, which ended on 30 September 2012, which reflected the concern of ANZ's senior management that the IPG was becoming too reliant on loan exposure. It warned that loans would be more expensive and that it was necessary to "prioritise deployment of new capital". Mr Law concluded the email by nominating 3pm that afternoon as the time at which a meeting and telephone hook-up would occur to communicate the message in the email to staff.

5 The email followed a telephone conference that had occurred earlier in the day at about 11 am in the course of which Mr Law had informed the State directors and Heads of Research and Analysis of the substance of what was to be contained in the email which was sent to them at 1.12 pm.

6 At the time the email was sent, the plaintiff was at celebrating the closing of a transaction at a lunch which he cut short to return to his office for the 3 pm meeting. By the time he arrived, 40 or 50 people were standing around waiting for Mr Law to dial in from Melbourne so the meeting could begin. Because the plaintiff was the most senior of those present in person, he was responsible for delivering the substance of the email to the members of staff of IPG who were present, either in person or by telephone.

7 Jason Dyki, one of the Relationship Managers who reported directly to the plaintiff, saw someone hand the plaintiff a piece of paper when he returned from lunch to the office to speak at the meeting. Subsequent investigation established that one only copy of the email had ever been printed out. The plaintiff said that he used Mr Law's email, which Ms Martinez had printed off for him shortly prior to the meeting, as a speaking note. In these circumstances, I infer that the document that Mr Dyki saw being handed to the plaintiff was a print-out of the email. I reject the plaintiff's evidence in his affidavit, which I consider to be a recent invention, that Ms Martinez printed out three or four hard copies of the email.

8 After the plaintiff had spoken, Mr Law, who was at home, indisposed, in Melbourne, addressed the meeting by telephone. He informed the staff that Alex Thursby, then Chief Executive International and Institutional Banking, had told him that he did not want IPG to become too reliant on loan exposure and that only deals which provided a return on equity value higher than 15% could be approved. Mr Law warned the staff not to overpromise to their clients before approval was obtained for any proposed deals. After Mr Law had spoken, there were questions, including one asked by Grace Irvin, who was a Research and Analysis Director of IPG in New South Wales. After Mr Law had answered her question, Ms Irvin walked across the room, but not in a way that indicated any dissatisfaction with what had transpired at the meeting. Nor did Mr Law detect any dissatisfaction.

9 The plaintiff did not recall what he did with the print-out of the email he had used as a speaking note. He left the office soon after the meeting because he had a 4 pm appointment with Mirvac.

10 The following morning, the plaintiff discussed the contents of the email with his staff, including Mr Dyki and Mr Sample, who were concerned about the likely effect of the new constraint on the financial performance of IPG. The plaintiff sat down with Mr Sample to look at "balance sheet usage, drawn usage, commitments to try and manage the fact that we had the largest exposures".

The doctored email

11 On 3 July 2012 Matthew Cranston from the AFR telephoned Mr Lawrence to say that he had received in the post a copy of an email dated 20 June 2012 from Mr Law to Mr Lawrence. Mr Lawrence in turn rang Mr Law, who rang Mr Cranston. Mr Cranston sent Mr Law the email he had received which differed markedly from the true email of that date and which included portions and deleted others that were not in the true email. The doctored email (with the added portions indicated by me in bold) read:

FROM: Law, Eddie

SENT: Wednesday, 20 June 2012 1:10 PM

TO: Lawrence, Matthew;

CC:

Subject: Re: ANZ Balance Sheet is Closed

for Remainder of Year for Property Deals

The key discussion points from the announcements from Mike Smith and Alex Thursby are as follows:

Focus going forward is on Balance Sheet productivity. No more new lending. We are closed for business. Do not tell the market or our clients.

This means that we will need to prioritise deployment of new capital. In order to do so we may seek to free up capacity by non renewal/ sale of assets.

Selling down existing exposure and prioritisation of future exposure may negatively impact the revenue line, however this has been provided for.

Rgds

Eddie Law

Global Head Commercial Property Group, ANZ

Sydney

12 As can be seen from the above, the additional portions were in a larger font than the original email. Mr Cranston subsequently scanned the envelope in which the doctored email had been delivered to him and emailed it to Mr Law.

The investigation conducted by the ANZ into the doctored email

13 Mr Law informed Kevin Corbally what had occurred. Mr Corbally, who had been the Head of Relationship Banking at the ANZ since March 2010, was the person to whom Mr Law, as Head of IPG, and the heads of all other industry segments (including agribusiness, natural resources, utilities and infrastructure, consumer and services, telecommunications and media), reported. Mr Corbally, who returned from annual leave on 9 July 2012, regarded the doctored email as a matter of great concern. He said in evidence:

"The concerns was the fact that, that an email, one, and been doctored, two, the content of the email was, was completely false, no more new lending, "We're closed for business. Do you not tell the market or our clients." That would obviously cause damage to us as an organisation, to our reputation and obviously would impact, you know, our clients' perception of us."

14 Given the seriousness of the matter, it was decided that an inquiry into the identity of the person who sent the doctored email should be referred for investigation to David McGowan, Head of Group Investigations at the ANZ. This occurred on 11 July 2014. At about this time Mr Law directed each of the recipients of the 20 June 2012 email to meet with Group Investigations.

15 Mr McGowan, who had been Head of Investigations since 2006, was responsible for managing all major investigations for internal fraud and corruption globally as well as major external and syndicated fraud crimes. He had served with the Victoria Police from April 1979 and attained the rank of Detective Sergeant before leaving in September 2000 to work for the ANZ. Michael Smith, who was then the Manager, Financial Crime Intelligence at the ANZ, was seconded to assist Mr McGowan and Brett Peacock, a Senior Investigator with the ANZ.

16 The relevant ANZ protocol, dated 3 May 2012, "Performance Improvement & Unacceptable Behaviour Policy" (the Performance Policy), contained a detailed description of the processes to be followed. In Mr McGowan's opinion the investigation conformed to the protocol, although this was disputed by the plaintiff for reasons addressed in more detail below. Because of the emphasis the plaintiff placed on the Performance Policy, various provisions are set out below. The section entitled "Investigation", which appears in the "Process Overview" document contained the following passage:

"Depending on the nature of the allegation, the Investigation should include the following steps:

. . .

4. Give the employee a reasonable opportunity to respond. This includes the opportunity to:

respond to each and every allegation made against them

respond to any evidence that may be relied on to make a finding through evidence of their own

raise any mitigating factors or other information they want taken into account

provide a written response if they wish."

17 The Performance Policy contained the following "Policy Detail", which was relevantly as follows:

1 Statement of policy

This policy is the foundation of all performance improvement, behaviour and disciplinary related matters arising at ANZ globally and replaces all previous policies dealing with performance improvement and misconduct globally. ...

... It is important to follow a process which ensures fair, consistent and defensible outcomes are achieved. A defensible outcome is one which affords both substantive and procedure fairness to the employee.

Procedural fairness requires a fair and proper procedure be followed when making a decision. The rules of procedural fairness require than an employee be informed of allegations being made, be given an opportunity to respond to all allegations in a manner appropriate to the circumstances and have their response fully considered. There must also be an absence of bias, evidence to support a decision and an inquiry into matters in dispute.

...

2 Guiding principles

While an employee's failure to meet expected standards of performance (performance improvement) should be managed differently to a failure to meet expected standards of behaviour (misconduct), the following guiding principles are common.

...

Any process or investigation relating to an employee's failure to meet expected standards of performance, behaviour or compliance should be in accordance with this policy and adhere to principles of procedural fairness.

...

Employees should be given the opportunity to provide an explanation or response and have that response considered before a decision is made.

The identification of persons of interest

18 Unlike many other investigations, which commenced with a complaint about a particular person, there was no known "suspect". Accordingly, the investigators began with the persons who had received the email 20 June 2012. Their names (in the order of the addressees on the email), titles and locations are set out in the table below:

Name	Position in IPG	Location as at 20.6.12
Matthew Lawrence	State Director, Queensland	Brisbane
Adrian Blake	State Director, Victoria	Melbourne
Duncan Caldwell	State Director, SA and WA	Perth
The plaintiff	State Director, NSW	Sydney
Steven Wiltshire	Executive Director, Research and Analysis	Brisbane
Mark Sample	Executive Director, Research and Analysis	Sydney
Chris Rees	Executive Director, Research and Analysis	Sydney
Adam Cotterell	State Director, NSW	Sydney
Fiona Martinez	EA to the plaintiff and Mr Cotterell	Sydney
Nicole Khalife	EA to Mr Law	Sydney

19 Mr Law was not regarded as a person of interest although, as the sender of the email, he obviously had access to it electronically and, as its author, was privy to its contents. The investigators considered that, since Mr Law was the person identified as the sender in the doctored email, it was not in his interests to have sent it and they excluded him from further consideration. Mr Law was included in some emails concerning the investigation as he was relevantly the line manager of those interviewed. He was, not, however, interviewed.

20 There were some staff movements during the investigation. Ms Khalife resigned from the ANZ on 10 July 2012. Her last day of employment was 13 July 2012. Mr Caldwell left ANZ on 24 July 2012, which I infer was as a result of the restructure. After the investigation had concluded, Mr Rees left ANZ on 14 September 2012 when his position was made redundant.

The interviews with persons of interest

21 Interviews were conducted with all recipients of the email except Ms Khalife who by this time was no longer employed by the ANZ. Mr Smith and Mr Peacock conducted preliminary interviews with Mr Blake, Mr Caldwell and Mr Sample on 13 July 2012. The persons interviewed were asked about their views as to who might have sent the doctored email. Mr Blake told investigators that he thought that the plaintiff was worried about the 20 June 2012 email because he was concerned that he would not be able to obtain approval for the capital required for his deals and, accordingly, that he would not receive a bonus at the end of the year.

22 As the plaintiff had been on leave on 13 July 2012, his preliminary interview did not take place until 16 July 2012. During the course of the interview Mr Smith noticed that the plaintiff, who gave the impression that he felt ill-prepared for the meeting, was either avoiding questions or not answering them directly. Mr Smith reported his observations to Mr McGowan as follows:

"The meeting with Paul Bartlett was strange. The others seemed a lot more relaxed and matter-of-fact, and they were comfortable about putting forward their hypotheses about what might have happened. We didn't get the same response from Paul. He seemed nervous and red-faced and was chewing gum throughout the meeting. I thought he looked flustered."

23 The interviewees were also asked whether they knew Mr Cranston. Only the plaintiff said that he had previous dealings with him, although Mr Wiltshire said that he had heard of him. Mr McGowan considered this to be "hugely significant", in part because when he examined the AFR website, he could not find any reference either to its mailing address in Brisbane or to Mr Cranston's location.

IT investigation

24 On about 13 July 2012 Mr Smith instructed a team within ANZ's IT Department, known as Computer Security Incident Response Team (CSIRT), to conduct searches of ANZ's electronic systems and identify evidence relating to the doctored email. Dean Thompson, IT Manager, was responsible for these inquiries. Mr Thompson had worked within the Global IT Security Team since the commencement of his employment with the ANZ in February 2004. He had managed the Global Security Operations Centre since 29 March 2011.

25 Mr Thompson was not informed of all the circumstances of the allegation or incident that gave rise to the investigation. This was consistent with the usual practice of General Investigations to ask CSIRT to use its technical expertise only to look for particular pieces of information. Mr Thompson conducted a search of the ANZ's Symantec Enterprise Vault System which retains all emails and attachments which have passed through ANZ's infrastructure for a period of seven years. He determined that the only people who had access to the 20 June 2012 email were the sender (Mr Law), the named recipients and Danielle McCormack, an employee of ANZ who had access through Outlook settings to the emails received by those who received the 20 June 2012 email.

26 Mr Thompson was of opinion, from reviewing the document, that the doctored email was created by a person editing the 20 June 2012 email as a draft email and printing it out. At the conclusion of the investigation, following the steps set out below, he remained of this view. Mr Fernon put to Mr Thompson that it was possible that the doctored email had been typed independently on a computer, to which he responded:

"It is possible, however the output shown on page 31 of this document [the doctored email] is consistent with how our email system, Microsoft Outlook, would express an email, but yes, it is possible."

27 This hypothesis was also put to Mr McGowan who accepted that it was a possibility, albeit a "remote" and "highly unlikely" one. He explained why he excluded the hypothesis in the following exchange:

"Q. If there were other copies perhaps made by one of the persons that was at the meeting of the Institutional Property Group at 3pm on the afternoon of 20 June then perhaps it could have been either posted by such a person, a staff of the bank, or given by a staff of the bank to somebody outside the bank to post?

A. Well, if somebody had taken that document they'd have to scan it and then reformat it and then try and alter it. We didn't believe that was a feasible explanation. It had to have been brought up on a screen and changed and printed."

28 Following the interview with the plaintiff on 16 July 2012 referred to above, Mr Smith sent an email to Mr Thompson in which he asked for the focus of the investigation to be shifted "a little bit" towards the plaintiff, although he confirmed that Ms Martinez and Mr Sample remained persons of interest.

29 Mr Thompson's unchallenged findings as a result of the searches he had conducted of ANZ's electronic systems were:

(1) The 20 June 2012 email was only printed once, by Ms Martinez at 2.37 pm on 20 June 2012.

(2) No one received an electronic copy of the 20 June 2012 email other than the named recipients and none of those recipients sent it to anyone else electronically.

(3) Of the recipients of the 20 June 2012 email, only Mr Blake and Mr Wiltshire were able to copy data onto USB drives. Such copying was not possible for the other recipients.

(4) No records of alterations to the 20 June 2012 email could be found on the computer or laptop hard-drives of the recipients of the email either in current or deleted files.

(5) No versions of the doctored email had been sent to an internal or external ANZ email address to be printed to a non-ANZ printer.

30 Mr Thompson's unchallenged evidence was that CSIRT's system was only able to identify documents that had been printed if the documents had been saved onto a computer or laptop before or after the document had been printed. If someone had printed an unsaved document, an electronic search would not be able to identify that the document had been printed. I accept Mr Thompson's conclusion that this was how the doctored email was created and why there was no record of its having been created or printed.

31 Based on the findings of the CSIRT, Mr McGowan concluded that it was highly probable that the person who prepared and posted the doctored email and envelope was an addressee of the 20 June 2012 email.

The postal marking on the envelope

32 The envelope in which the doctored email was sent was marked with the letters "SWLF", which I accept is a reference to "Sydney West Letter Facility". The date stamped on the envelope was 28 June 2012, which indicates that it was received by that facility on that day. Mr McGowan inferred that it had been posted on either 26 or 27 June 2012. Mr Cranston told Mr Law that he had received it on 28 June 2012.

33 Mr McGowan inferred from the fact that the doctored email was posted in Sydney that it was highly likely that the sender of the doctored email was one of the Sydney recipients. He rejected the alternative hypothesis which was put to him by Mr Fernon in the following exchange:

"Q. Isn't another conclusion that it could have been sent by somebody from interstate to be posted in Sydney?

A. It's remotely possible but I didn't consider that to be have any merit. It would require other parties to be involved and someone to receive it and post it. On the broad spectrum it is a remote possibility but highly unlikely and I didn't put any merit to it."

Contact between the plaintiff and the Commonwealth Bank and the plaintiff's representations about that contact with Mr Law

34 The IT investigation into the doctored email discovered that the plaintiff had sent an email to Cathy Yuncken at the Commonwealth Bank of Australia (CBA) on 22 June 2012 with the subject heading: "Paul Bartlett - private". The email read:

"Hi Cathy,

When we caught up late last year it was nice but I did get the impression no senior roles were available at your shop. I now hear that CBA may be looking for a new head for your property relationship group with Peter set to retire soon.

Is there any scope for me to talk to the right CBA people about that position. The CEO's at Brookfield, Mirvac, Investa/ MRSE, Goodman, Charter Hall, Centro, Westfield etc etc would all say I am the "best". Some of them actually suggested I should make contact with CBA.

Would appreciate any thoughts from you.

Best regards,

Paul

Paul Bartlett

State Director, NSW

35 The investigators showed the email to Mr Law, who asked the plaintiff whether he had approached CBA about a position. The plaintiff responded that the last time he had spoken to CBA was at the end of 2011 and denied that he had spoken to CBA any more recently. Mr Law reported this conversation to Mr Smith, who in turn reported it to Mr McGowan. Mr McGowan gained the impression that the plaintiff had not been honest in his discussion with Mr Law. On 24 July 2012 the CBA email was also forwarded to Mr Corbally by Mr Law who also attached Mr Smith's email.

The plaintiff's prior history at the ANZ: background and surrounding circumstances

36 Mr Corbally was the decision-maker at the ANZ who was responsible for deciding what would be done as a result of the investigation. Mr Corbally had been the head of Diversified Industries in the Institutional Banking team at the ANZ from July 2009 until March 2010, at which time he was appointed Head of Institutional Relationship Banking Australia. Mr Corbally is currently managing director and Global Head of Credit and Capital Management within ANZ's international and institutional banking business. What Mr Corbally knew of the plaintiff's background at ANZ, either from his own experience or from being told by others, was, accordingly, of relevance to the investigation and to his opinion on the basis of which the plaintiff's employment was terminated. These matters are set out below.

37 The plaintiff worked in a Group 2 position in the IPG. He was the only person in IPG in Sydney at that level to have his own office. He reported to Mr Law, who was in Group 1 and who in turn reported to Mr Corbally. There were several Relationship Managers, including Mr Dyki, who reported to the plaintiff. There was also a Research and Analysis team, which included Ms Irvin, whose role included the preparation of credit papers and term sheets which would be submitted, with the documents prepared by the Relationship Managers, to the Property Credit Risk Group, which would then assess the proposed loan. Phil Jones, who was based in Melbourne, was Head of Property Credit Risk. He had the ultimate authority to approve or decline loans proposed by IPG as far as credit risk was concerned. By reason of this structure, it was important that those in IPG had good working relationships with those in the Credit Risk Group.

38 Every year senior executives of the ANZ, including the plaintiff, took part in a performance review, following which they were graded and allocated a Relative Performance Outcome (RPO). These assessments took place in the last quarter of the ANZ's financial year, which ended on 30 September. The day on which these assessments were conducted was known as "People Day". An RPO of 1 was the highest and signified that the recipient was in the top 5%; an RPO of 2 was the second highest and signified that the recipient was in the top 6-20%. There were four factors to be taken into account in the grading: financial, customer, process and people. Compliance with the ANZ's standards of behaviour was also germane, as well as adherence to ANZ's risk and compliance standards. As Mr Corbally put it:

". . . the bonus and the performance review takes into account not just what you've achieved but also how you achieved that."

39 Mr Corbally first became aware of the plaintiff in the course of the annual performance review in 2009. George Giovas, who was then in the position subsequently occupied by Mr Law, contended that the plaintiff should be a RPO 1 but there were concerns about his values and his inability to take what was referred to as a "whole-of-bank" approach. After much discussion, the plaintiff was awarded an RPO 1 because of his financial performance and capacity.

40 In April 2010 the ANZ conducted an investigation into the allegation that some staff, including Mr Giovas and the plaintiff, had arranged for their EAs to do on-line training for them. Whether, and in what circumstances, this had occurred will be addressed further below. Mr Corbally was told by Gary Newman, Head of Global Relationship Banking, that, following the investigation, Mr Giovas' employment was terminated and the plaintiff was issued with a formal warning and a "behavioural flag" which would affect his RPO. Mr Newman told Mr Corbally that the reason the plaintiff's employment had not been terminated was that he had admitted his wrongdoing, whereas Mr Giovas had not.

41 In May 2010, Mr Law was appointed to replace Mr Giovas. From that time, the plaintiff reported directly to him. This was the first occasion on which Mr Law had occasion to work with the plaintiff, although they had already met briefly in a social environment. Mr Law was informed by Nigel Williams, who was then the Head of Institutional Relationships, that the position as Head of IPG was vacant as Mr Giovas' contract had been terminated because he had arranged for his EA to do his training for him. Mr Williams also told Mr Law that the plaintiff had been disciplined for the same reason.

42 Shortly after Mr Law's appointment, the plaintiff spoke to Mr Corbally and told him that he was disappointed not to have been appointed to take over Mr Giovas' position because he wanted the job. The plaintiff told Mr Corbally that he realised that the behavioural flag was a factor. I do not accept the plaintiff's denial of this conversation.

43 As a result of the behavioural flag, the plaintiff was not a contender for an RPO 1 in 2010. He was awarded an RPO 2 that year. The following year at the Performance Review meeting in September 2011, there was discussion about what RPO was appropriate for the plaintiff. Mr Law and each of the Section Heads considered that the plaintiff did not deserve an RPO 2 because his values and behaviours did not correspond with his position as a Group 2 Executive. They voted unanimously that he ought be awarded an RPO 3. However, Mr Corbally, as Chair, overrode the consensus of the majority and determined that the plaintiff ought be awarded an RPO 2.

44 Mr Corbally was aware that there were tensions between the plaintiff and Mr Law. On one occasion the plaintiff assured Mr Corbally that he was trying but that "it's just not working with Eddie".

45 The plaintiff often told Mr Corbally that his business was "very good" and more important than any other business in the property team and that he ought be treated differently to those who led the other teams. I do not accept the plaintiff's denials of these statements. In mid-2012 the plaintiff expected to receive an RPO 1 since he considered that the "wonderful" work he had done with respect to the Centro group of companies which he regarded as having saved the ANZ hundreds of millions of dollars would be rewarded by such a grading. The plaintiff's self-assessment did not necessarily correspond with the views of others at the ANZ.

46 There were concerns within the ANZ about the plaintiff's attitude and behaviour. For example, Mr Jones informed Mr Corbally and Mr Law that in 2010 the plaintiff had banged his hands on a table at a meeting with Steve Hall, Director of Property Credit Risk, and had sworn in a loud voice. Not only did Mr Corbally and Mr Law both regard this display of intemperate aggression as inappropriate in a professional setting, but Mr Law was also concerned that it might adversely affect IPG because IPG and Property Credit Risk assessed transactions proposed by IPG from a credit perspective. At Mr Corbally's request, Mr Law raised the matter with the plaintiff whose response was:

"But you don't understand, Eddie, these people can be so frustrating."

47 I accept Mr Law's evidence of this exchange. I regard the plaintiff's response as an admission that he behaved in the way reported to Mr Law. I find that the hand banging incident occurred as related to Mr Law. I do not accept the plaintiff's denial. Nor do I accept the plaintiff's evidence that his relationship with Mr Jones and Mr Hall was "courteous, constructive and professional". This affects my assessment of the plaintiff's credibility.

48 On the plaintiff's performance appraisal form for 2010, Mr Law recorded the following comments:

[in respect of 'Customer' category]

"Care must be taken to make sure that whilst client satisfaction is a primary goal, it cannot come at the expense of alienating internal ANZ stakeholders."

[in respect of 'Process/ Risk' category]

"All objectives met, however would encourage fostering an improved relationship with Risk to facilitate their understanding and willingness to offer flexibility when required."

[in respect of 'People' category]

Agree with Paul's comments, however would encourage continuing to work with other stakeholders on a proactive basis to enhance their capacity and willingness to act as suitable sponsors for other opportunities that may arise going forward.'

49 In light of the background referred to above, Mr Law's comments evince a concern that the plaintiff's aggressive approach towards members of Credit Risk, such as Mr Jones and Mr Hall, had the potential to jeopardise the approval of deals by the Credit Risk area of the ANZ, to the detriment of IPG.

50 Mr Law had heard from several employees of the ANZ that the plaintiff would criticise him to other staff members and seek to undermine him. From about the beginning of 2011 Mr Law did not trust the plaintiff to act honestly and openly although he trusted him to perform his daily duties. Notwithstanding Mr Law's reservations about the plaintiff, I am satisfied that Mr Law bore him no personal animus. He rejected the propositions that he did not see "eye-to-eye" with the plaintiff and that he did not "like" the plaintiff. Mr Law came across as someone who made a clear distinction between his professional and personal life and regarded affection and other emotions as something reserved for the latter.

51 In mid- 2012 there was to be a restructure of the IPG as a result of which it was contemplated that some employees, including senior executives, would lose their jobs. This created uncertainty amongst staff. The plaintiff was one of two employees who oversaw IPG's relationships with listed clients in New South Wales; the other was Mr Cotterell. The plaintiff was responsible for large listed real estate investment trusts whereas Mr Cotterell led a team that focussed on the mid- to large private property developers and investment companies. One of the proposals was that these two positions at Group 2 in the Sydney Office would be merged into a single position. It was not known whether the second position would become a Group 3 (lesser) position or whether it would be dispensed with altogether.

52 On 13 June 2012 Mr Corbally met with the plaintiff. As far as Mr Corbally was concerned, the meeting was one of many informal meetings which he had with the people who reported to those who reported to him to help them with career planning and to assist the ANZ with succession planning. In the course of the meeting, Mr Corbally asked the plaintiff whether he would be interested in Mr Law's role if, for any reason, Mr Law decided to leave the ANZ. The plaintiff responded that, although he did not want Mr Law's role, he did want to be promoted to a Group 1 employee (Mr Law's level), which was part of the senior executive, and to report directly to Mr Corbally. The plaintiff suggested that he could be Head of Media and Telecommunications. He also told Mr Corbally that he would suggest two people who could be considered for Mr Law's job. When Mr Corbally said that he would not be made a Group 1 employee, the plaintiff said that he would be "fine" with being appointed to lead the merged IPG team in New South Wales (following the merger of his and Mr Cotterell's positions), even though he would still be reporting to Mr Law.

53 Mr Corbally assured the plaintiff that he was a valued member of the team and intimated that he should "hang in there" as "changes may eventually occur". At the time he made those comments, Mr Corbally was aware that the decision had already been made to merge the two positions, although it had not yet been announced. However the plaintiff was aware of the possibility since it had been discussed openly in ANZ since mid- June 2012. Mr Corbally made a contemporaneous handwritten note of his meeting which is consistent with the findings I have made above as to what occurred at the meeting.

54 The plaintiff's evidence about what had occurred at the meeting on 13 June 2012 was quite different from that of Mr Corbally's. He, too, made a note in his notebook of what occurred at the meeting, including the following:

"Eddie is to be retired as part of re-org."

55 I accept Mr Corbally's evidence not only that he said no such thing but also that he had no intention of replacing Mr Law; nor was he aware that anyone else had such an intention. The plaintiff's note is not only unreliable but also incorrect. As referred to above, I accept Mr Corbally's version of the meeting on 13 June 2012 and reject the plaintiff's version. In particular, I find that Mr Corbally did not tell the plaintiff that he had had "the best year ever". I also reject the following evidence given by the plaintiff in his cross-examination:

Q. You said that you were the obvious person to head up the two teams?

A. No, I recounted the email that I had sent earlier which said either Adam Cotterell or myself could head it up and the other one be a deputy, if that's possible.

56 The email which the plaintiff referred to in his answer was one that he had sent to Mr Law on 14 July 2011 and which was annexed to his affidavit. It contained the passage:

"Adam or I would lead the team with the other acting as deputy head."

57 I regard the proposition that the plaintiff did not mind whether he was leader or deputy as wholly inconsistent with his view that he was superior to Mr Cotterell and that his part of the business was significantly more valuable to the ANZ. To the extent to which he mooted the proposal of his being deputy, I regard his proposal as disingenuous, since he must have believed that, if the teams were merged, he would be entitled to be the leader.

58 In his evidence Mr Corbally explained his understanding of the plaintiff's change in position from 2010, when the plaintiff had wanted Mr Law's job, to June 2012 when he no longer wanted it. He said that in 2010 Mr Law had had an "army" of support staff but that, because of retrenchments, he no longer had the administrative support that he once had, which made the position less attractive to the plaintiff.

The restructure and its effect on the plaintiff and the investigation

59 As referred to above, the ANZ had determined, as part of its restructure, that the roles which the plaintiff and Mr Cotterell had previously performed would be combined into one position of State Director, New South Wales. The holder of the new position was to oversee all NSW-based relationships with listed companies. The plaintiff had told Mr Corbally on a number of occasions that he considered himself to be the better candidate. The ANZ preferred the plaintiff to Mr Cotterell for the new position because he had experience with large listed companies.

60 Cathryn Carver, Managing Director, Institutional, and Mr Corbally intended to announce the restructure and the plaintiff's appointment to the new role on about 16 July 2012, about a week after Mr Corbally had returned from annual leave. At some time prior to 24 July 2012 there were discussions about delaying the decision about who would be appointed to the role. Mr Corbally, in particular, was not comfortable about making the announcement before the investigation into the doctored email had concluded. However, Ms Carver told Mr Law that the appointment needed to be announced by 24 July 2012 for operational reasons since a tranche of other appointments was being announced across the business.

61 Mr Corbally decided that all recipients of the 20 June 2012 email who were based in Sydney would be asked to sign a statutory declaration that they were not involved directly or indirectly in the sending of the doctored email. He also decided that the plaintiff would not be advised of his appointment as Director- NSW until after he had signed the statutory declaration. Mr Corbally wanted the plaintiff to appreciate that Group Investigations had not concluded its investigations and that the ANZ was relying on his statutory declaration in appointing him to the position.

Formal interviews with Sydney addressees

62 Because Mr McGowan deduced that the sender of the doctored email was based in Sydney and had received the 20 June 2012 email electronically, he instructed Mr Smith to conduct formal interviews with each of the Sydney-based recipients of the email. Accordingly, on 23 July 2012, Mr Peacock and Mr Smith interviewed the plaintiff, Mr Cotterell, Mr Sample, Ms Martinez and Mr Rees, in the course of which handwriting specimens were requested and provided. Transcripts were prepared of those interviews.

63 During his formal interview, the plaintiff suggested that Leo Zygoras, a Relationship Manager of IPG, might have had an axe to grind because of the "cultural connection" between him and George Giovas (whose employment had been terminated in April 2010). The plaintiff also referred to an incident where Mr Zygoras had used Mr Cotterell's computer to send the plaintiff an email as a joke. The investigators suspected the plaintiff of raising these matters to deflect the inquiry from him.

64 On 23 July 2012 the plaintiff asked one of the investigators whether he could get legal advice to review the statutory declaration before signing it. The investigator asked why he felt he needed legal advice. The plaintiff then asked whether he was the only person who had asked for time to get legal advice and was told that he was. The plaintiff then said that he would sign the statutory declaration on without advice.

65 Mr Smith reported to Mr McGowan following this interview that the plaintiff's demeanour was in marked contrast to that exhibited in his preliminary interview on 16 July 2012. He referred to the plaintiff having documents to prove his points on 23 July 2012, including documents relating to computer security that cast aspersions on others. The plaintiff told investigators that a copy of the email was found in Ms Irvin's in-tray. This added to Mr Smith's concern that the plaintiff was deliberately misleading the investigation and providing them with what he believed to be "red herrings".

66 On 24 July 2012 each of the interviewees, including the plaintiff, was asked to sign a statutory declaration. On 24 July 2012 the plaintiff made the following statutory declaration:

"Statutory Declaration

OATHS ACT 1900, NSW, EIGHTH SCHEDULE

I, Paul William Bartlett do solemnly and sincerely declare that Annexed hereto and marked with the letter "A" is a copy of the original email sent by Eddie Law dated 20 June 2012, and in relation to that document I declare that I was not knowingly involved, directly or indirectly, in making written alterations to the content.

Annexed hereto and marked with the letter "B" is a copy of a correspondence received by a journalist from the Australian Financial Review, and in relation to that document I declare that I was not knowingly involved, directly or indirectly, in the correspondence being posted to a journalist from the Australian Financial Review on or around the 28th of June 2012.

I declare that I was not knowingly, directly or indirectly, in the attempted media leak to the Australian Financial Review between the 20th and the 28th of June 2012.

And I make this solemn declaration conscientiously believing the same to be true, and by virtue of the provisions of the Oaths Act 1900.

Declared at Sydney on 24 July 2012

. . . "

The announcement of the plaintiff's new role on 24 July 2012

67 On 24 July 2012 the plaintiff was informed of his appointment to the new combined position. The role was not a promotion, in that he remained at Group 2 level. Nonetheless his responsibilities had increased. The plaintiff signed the letter of appointment on 24 July 2012. When Mr Corbally saw the plaintiff's handwriting on the letter of appointment he noticed that an "E" resembled an "E" on the envelope in which the doctored email had been despatched to Mr Cranston. He informed Mr Smith, who arranged for this further specimen to be provided to the forensic handwriting examiner whom the ANZ had engaged to conduct an analysis as set out below.

68 On the evening of 24 July 2012 at 8.08 pm, Kerrie Harris, Head of Human Resources Global Relationship Banking and Institutional Australia, sent an email to Ms Carver, Mr Corbally and Susana Angelevski in which she referred to the restructure and listed the matters to be attended to, including:

"Conduct analysis on replacement of segment head- internal stakeholder discussions, perf assessment, external search (low key). communication with Eddie on outcome."

69 I accept Mr Corbally's evidence that there was no suggestion or proposal that Mr Law be removed from his position. The email concluded:

"The investigation should continue as well and if we reach a conclusion then we re-assess our action plan."

Submission of handwriting samples for assessment and comparison with the questioned document

70 On 12 July 2012 Mr Peacock had contacted Forensic Document Services Pty Limited (FDS) to retain the firm to conduct an analysis and report, if required, to ascertain whether the questioned sample (the envelope) was written by the same person as various specimen samples, which were to be obtained from a person or persons of interest.

71 As at 24 July 2012 Mr McGowan decided that the investigation should focus on the plaintiff since he was an original addressee of the 20 June 2012 email, he was Sydney-based, he had had prior dealings with Mr Cranston and he appeared to have a financial motive for trying to get the ANZ to relax the new restrictions. Mr McGowan was also concerned about the plaintiff's credibility and the fact that he appeared to be trying to implicate others. Accordingly, he decided to send the envelope and handwriting specimens obtained from the plaintiff to a forensic examiner for analysis.

72 Michelle Novotny, a senior forensic document and handwriting examiner with FDS, met with Mr Peacock on 26 July 2012. She was provided with a copy of the doctored email and specimen documents said to have been written by the plaintiff. She was also provided with a copy of the envelope, but not the original, which remained in Mr Cranston's possession.

73 Ms Novotny was provided with further specimens on 27 July 2012, after which she conducted a preliminary examination. Her work was peer-reviewed by Paul Westwood, a principal of FDS, on 2 August 2012. Preliminary advice was given by Ms Novotny to Mr Peacock on 3 August 2012. At that time there was some prospect of Ms Novotny having to travel to Brisbane to see the original envelope but, as Mr Cranston refused to allow the original envelope to be inspected, this did not eventuate. Mr Cranston gave his reasons for his refusal in an email to Mr Smith on 6 August 2012 as follows:

". . . we also will not be showing the original for the forensic service to examine.

Whilst we have determined the letter could be fake, we also believe in this instance that we should protect anonymous sources waiting to signal important information."

74 Further specimens were provided to Ms Novotny. On 9 August 2012 Ms Novotny conducted a further examination of specimen documents and drafted her advice, which was peer-reviewed by Stephen Strach of FDS. Her final report was forwarded to the ANZ on 9 August 2012.

75 Ms Novotny expressed her findings and conclusions in her report of 9 August 2012 as follows:

The examinations are limited by the reproduction nature of the envelope to consideration of only the pictorial features of the handwriting that are evident on the copy submitted. A detailed examination of the original document could also take into account the finer details of structure and dynamic qualities (such as the order of strokes and fluency). As a result, the conclusion expressed is qualified. In the absence of the original envelope, it is also necessary to assume that the copy submitted is a true depiction of the document it purports to represent (i.e. that it is not a reproduction of a document that is the product of some form of manipulation)

I observed numerous pictorial similarities between the questioned handwriting and the Bartlett specimens. While not all elements in the questioned handwriting could be accounted for in the available Bartlett specimens, I did not observe any fundamental or consistent differences between them. There are several letters appearing in the questioned handwriting that appear only a few times or not at all in the Bartlett specimens so their consideration in the examination was limited or precluded altogether.

Within the limitations of the reproduction nature of the handwritten envelope, I concluded that it is highly probable that the questioned handwriting was written in original form by the writer of the Bartlett specimens.

76 The expression "highly probable" was explained in Appendix B to the report as follows:

I am almost certain that the questioned writing/signature was written by the writer of the specimens. However, some limiting factor, often the amount of writing in question and/or when the questioned document is a reproduction, has reduced the level of certainty attainable, and I cannot entirely eliminate the possibility of this being another person's writing, but consider this to be highly unlikely.

Suspension of the plaintiff's employment

77 On either 9 or 10 August 2012 Mr Corbally read Ms Novotny's report and noted the meaning of "highly probable" in Appendix B. He met with Mr McGowan, Mr Smith, Mr Carver, Kristine Thomas, Senior Employee Relations Adviser, and Ms Harris.

78 The plaintiff was due to travel to Asia on Sunday 12 August 2012. Mr Corbally was loath to permit him to represent the ANZ, in light of what he understood to be the findings of Ms Novotny's report. He arranged to meet the plaintiff on Friday 10 August 2012. He gave him a letter, which he read out. The letter gave notice of his suspension and required him to attend a further interview with Group Investigations on Monday 13 August 2012. The plaintiff continued to deny that he was responsible for sending the doctored email. He was informed of his right to have a support person present. He was also told that there would be a further meeting prior to any decision being made about disciplinary conduct.

79 The plaintiff handed in his security pass and his Blackberry mobile phone. He telephoned Mr Law who brought his personal belongings from his office. Mr Corbally escorted the plaintiff from the building.

80 I reject the plaintiff's evidence that Mr Corbally told him at this meeting that he expected that the plaintiff would be back at work later that week and that he did not want to unsettle things. That Mr Corbally would have said such a thing is glaringly improbable and entirely at odds with the gravity of the situation facing the plaintiff at the time. I accept Mr Corbally's evidence that he said no such thing.

Second formal interview with the plaintiff on 13 August 2012

81 After Mr McGowan had received Ms Novotny's report of 9 August 2012, he arranged to conduct a second formal interview with the plaintiff and his solicitor, Mr Viney, in accordance with the requirement in the letter of suspension dated 10 August 2012. Mr Peacock was also present. A transcript was taken of the interview. It recorded that, prior to the commencement of the interview, the plaintiff was warned that he was under no obligation to answer questions or participate in the interview but that any answers he gave could be used in civil or criminal proceedings against him. He confirmed that he adhered to his statutory declaration.

82 The plaintiff was asked about his view of the 20 June 2012 email and his relationship with Mr Law. He was shown a copy of the envelope and the doctored email. The postmark was pointed out to him. The plaintiff was then shown documents which had been obtained from his personnel file and provided to Ms Novotny. He confirmed that the writing on those documents was his writing. Mr McGowan then informed the plaintiff that the examiner had concluded that it was highly probable that the questioned handwriting (the envelope) was written by the person who wrote the specimen handwriting provided by the plaintiff and obtained from his personnel file. Ms Novotny's conclusion was read out to the plaintiff as well as the explanation from Appendix B to her report.

83 The transcript of the interview recorded that Mr McGowan then said to the plaintiff:

"The document examiner makes a finding that it's highly probable it's your handwriting. There was 10 people that received the email, of which you were 1. There were 6 people in Sydney that could have mailed it here, of which you were 1. You're the only person in that group who has admitted having knowledge of the journalist Matthew Cranston."

84 The plaintiff suggested in the interview that he would have no motive to send such an email since he would not want to harm the ANZ. He said that if he had wanted to harm the ANZ he would have "put a lot more facts and figures into the email". He suggested that someone might have got someone outside of New South Wales to post it to Sydney. He postulated that the culprit was a junior, disgruntled staff member. In support of this suggestion, he referred to the fact that the title given to Mr Law on the doctored email was not in fact his title. The plaintiff also suggested that the examiner ought not to have used specimen documents from many years ago because people change their handwriting and said that it should have been confined to specimens within the last twelve months.

85 Following this exchange the plaintiff asked:

"Do I have a chance to go and get my own forensic evidence to dunce what you've provided?"

86 A copy of Ms Novotny's report was not provided to the plaintiff. Nor was he given an opportunity to obtain a report in response. Mr Corbally explained that the collective view (which I infer was communicated to Mr McGowan before the meeting of 13 August 2012 began) was that it was unnecessary that the report be provided and that it would delay the process unnecessarily.

87 Mr McGowan told the plaintiff that he would report to "the business" and that there would be another meeting before any decisions were made. The plaintiff asked if anyone else's handwriting had been analysed to which Mr McGowan informed him that he was not permitted to say. The plaintiff told the investigators that he was shocked and that he had expected them to tell him that they had found the email. He said:

"I mean I thought you were - I mean I'm so kind of shocked - I thought you were going to have other emails that you found - which I knew you wouldn't find them on me. But I thought you actually had somebody in mind in the group and you wanted my kind of counsel. Somebody who's close to me. So this has thrown me because I - all I can say is when you glance through all that writing - I don't know this firm - I'm sure they're very legitimate and they're very very good. But, you know, if you brief somebody, it's easy to kind of come with a conclusion of highly probability versus if I briefed them and they came up with an unlikely probability or whatever the phrase is for the lowest one."

88 Mr McGowan's view was that the plaintiff's behaviour seemed "hammed up and pre-prepared". He did not believe that the plaintiff was surprised about the purpose of the meeting. After the recorded part of the interview was over the plaintiff asked about trying to get the original document from Mr Cranston. Mr McGowan suggested that the plaintiff try to get it himself since he knew him already. The plaintiff also suggested that Mr McGowan should talk to Mr Corbally about a confidential meeting that had occurred between Mr Corbally and the plaintiff on 13 June 2012.

89 Following the meeting Mr McGowan raised with Mr Corbally the plaintiff's reference to the confidential meeting. Mr Corbally recalled the meeting of 13 June 2012 but did not consider that he had given the plaintiff any such assurance. He told Mr McGowan that he did not know to what conversation the plaintiff had been referring

Mr McGowan's conclusions and the Investigation Report

90 Mr McGowan believed that the plaintiff had at least two motives for sending the doctored email. First, the plaintiff felt aggrieved that he had not been appointed to replace Mr Giovas and bore a grudge against Mr Law with whom he had an uneasy working relationship. Secondly, Mr McGowan also considered, as a result of Mr Blake's comment to him, that the plaintiff was concerned about how the 20 June 2012 email would affect the receipt of any bonus and hoped that sending the doctored email would cause the ANZ to reverse its decision about funding. Mr McGowan said in evidence:

"Well, my belief the motive was that if this if the, if the media would pursue that inquiry ANZ would have backed off in reducing capital funding. Banks are very sensitive to adverse media and that my view is that would have been a direct intention to avoid that capital reduction."

"He would certainly be affected if he couldn't meet his sales targets because there wasn't enough capital available to continue to lend."

". . . my opinion was that the intention was to stop that capital reduction by running it through a journalist."

91 Following the interview with the plaintiff on 13 August 2012 Mr McGowan concluded that there was sufficient circumstantial evidence to show that the plaintiff was responsible for posting the doctored email to Mr Cranston. He prepared an Investigation Report, with the assistance of Mr Smith, which summarised the information that had been gathered during the investigation and his conclusions. At 6.07 pm he emailed the report to Mr Corbally, who read it and, at 8.47 pm, forwarded it to Ms Carver, Ms Harris and Ms Angelevski. In the forwarding email he extracted the conclusion of the report:

"Conclusion says, 'we are satisfied there is sufficient circumstantial evidence to show Paul was responsible for the media leak'."

Telephone conversation between the plaintiff and Mr Corbally on the evening of 13 August 2012

92 Mr Corbally rang the plaintiff on the evening of 13 August 2012 to arrange for him to attend a meeting on 15 August 2012. The plaintiff raised the conversation to which he had referred in the interview with Mr McGowan that day. When Mr Corbally asked about the conversation, the plaintiff said:

"The discussion where you offered me Eddie's job and I spoke to you about two people in the marketplace who could potentially do Eddie's job."

93 The plaintiff then said that he assumed from the discussion that he was going to get Mr Law's job and proffered this as a reason why he would not have sent the doctored email. He also told Mr Corbally that Mr Dyki had telephoned him because he had heard that he had not been present at one of the client meetings in Asia that had been arranged. Mr Corbally reported the substance of his conversation with the plaintiff to Ms Carver, Ms Harris, Ms Angelevski, Mr McGowan, Ms Thomas and Fiona McDonald, Head of Human Resources, Legal. Subsequently Mr Law contacted Mr Dyki who confirmed that he had not contacted the plaintiff as alleged. Mr Law reported what he had been told by Mr Dyki to Mr Corbally.

The meeting on 14 August 2012

94 On 14 August 2012, Mr McGowan attended a meeting with Ms Carver, Mr Corbally, Ms Thomas and Ms Harris. The purpose of the meeting was to discuss what was to be done with the plaintiff as a result of the findings of the investigation. Ms Carver said:

"This is a difficult decision to make and it might hurt the business but I have no doubt Paul [the plaintiff] did this and the right thing to do now is to terminate his [the plaintiff's] employment."

95 By letter dated 14 August 2012 Mr Corbally wrote, on behalf of the ANZ, to the plaintiff. The letter read in part:

"I write to you further to my letter to you of 10 August 2012 and our conversation on 13 August 2012.

I confirm that, as a result of an investigation, ANZ has reason to believe that you may have breached ANZ's Code of Conduct and Ethics in relation to acting in ANZ's best interests and valuing ANZ's reputation, acting with honesty and integrity, respecting and maintaining privacy and confidentiality and complying with the Code, the law and ANZ policies and procedures.

Specifically, it is alleged that you have knowingly altered a correspondence emailed by Eddie Law (Global Head, Commercial Property) dated 20 June 2012 and mailed it to Matthew Cranston (Journalist, Australian Financial Review, Brisbane) on or around 28 June 2012.

Such behaviour is a breach of our policy, procedures and values and is viewed seriously by ANZ. As a result, this behaviour may warrant formal disciplinary action. Disciplinary action could range from a warning up to the termination of your employment.

I would like to meet with you to discuss your behaviour prior to making a decision about disciplinary action. During the meeting I will be seeking to gain a full explanation of the situation from you. You will be given every opportunity to appropriately respond to this issue.

As we discussed and agreed on 13 August 2012, we will meet at 12.00 noon on Wednesday 15 August 2012. The meeting will take place at Level 1, 10 Bridge Street, Sydney. Kristine Thomas (Senior Employee Relations Advisor) will also be in attendance. You may bring a support person to the meeting.

. . . "

96 Mr Viney, the plaintiff's solicitor, wrote to Mr Corbally on 14 August 2012. Among other matters, he referred to the plaintiff having been presented with the expert report at the meeting on 13 August 2012 and referred to its conclusion. He continued:

"Again this is denied, and we would be grateful for the opportunity to pursue this issue prior to a final decision being made in the investigative process.

In that regard, we note the qualifications contained in the report by FDS. We've not seen the instructions in regard to the report. It has not been tested to any degree and we would suggest would not be fair if relied upon.

. . .

As sought above, I believe there would be some utility in allowing us assisting Paul to be given the opportunity to attempt to obtain the original of the documentation in the possession of Mr Cranston for further analysis.

. . ."

Meeting on 15 August 2012

97 On 15 August 2012 the foreshadowed meeting occurred at the offices of the ANZ. Mr Corbally and Ms Thomas were present on behalf of the ANZ. The plaintiff was there with Mr Viney, who was both his solicitor and friend. Ms Thomas made notes of what occurred. Her notes were not verbatim and were not intended to be a transcript.

98 Mr Viney and the plaintiff asked for a copy of Ms Novotny's report and for the opportunity to take it away and obtain a report from an expert of their choosing. Mr Corbally declined to allow this. He explained in his evidence that this issue had been considered in advance and he had been advised by Ms McDonald that it was not necessary to do so.

99 I accept Mr Corbally's evidence that an exchange to the following effect occurred in the meeting:

Mr Corbally: Tell me about the previous breach of ANZ policy, and why you were previously issued with a warning.

Mr Bartlett: I was in Asia with my boss before Christmas, and then in Europe for a five-week holiday. Unbeknownst to me, training courses had become due for my completion, and my Executive Assistant had completed them for me.

Afterwards, so many people came up to me and told me that their secretary did their training for them. It was not really a big deal. But I took the fall to save my Executive Assistant's job.

But I didn't do this, because I really love ANZ. You have just promoted me, and I really love my job here. I feel secure and valued at ANZ.

Mr Corbally: Have you been thinking about leaving ANZ?

Mr Bartlett: I asked the CBA for a job, because I was uncertain about my role with the merging of the property businesses. However they instigated the contact. I talked to them because I was unsure whether I had my job or not, and I needed protection, a fall-back.

100 I accept, as referred to above, the accuracy of Mr Corbally's recollection that the plaintiff said that it was the CBA that had instigated the contact. Although Ms Thomas' notes did not record this part of the conversation I am satisfied that Mr Corbally accurately remembered what the plaintiff had said. It struck Mr Corbally as a lie at the time because he was already aware that the plaintiff had sent an email to CBA on 22 June 2012 and that it was plain from its terms that it was the plaintiff who had initiated contact.

101 After this exchange Mr Corbally and Ms Thomas took a break from the meeting so that Mr Corbally could consider all the available information. He found the plaintiff's responses unconvincing. He was troubled by the fact that the plaintiff intimated that he was uncertain about his future with the ANZ, which Mr Corbally considered to be inconsistent with the plaintiff's account of the meeting of 13 June 2012 in which he contended that Mr Corbally had offered him Mr Law's job.

102 During the break, Mr Corbally, who wanted to obtain confirmation from the ANZ's records about the reason for the prior warning, arranged for the investigation report of the so-called E-train incident to be sent to him. At 1.42 pm Evangeline Carpio, Head of Human Resources Advisory, Employee Relations, sent an email to Mr Corbally which contained the extract of the Investigation Report that related to the allegation that the plaintiff had asked his EA to do training for him. The report summarised relevant emails that had been extracted from the ANZ archive as follows:

• Email dated 4 December 2009 (7.04 pm) from Ms Martinez to Ms Purcell asking to call to Ms Martinez in relation to Mr Bartlett's RAF [Risk Accreditation Framework (RAF): e-training]. See email appended on Attachment 10.
• Email trail dated 7 December 2009 (2.59 pm, 4.51 pm, 5.28 pm, 5.35 pm, 5.42 pm) from Ms Purcell to Ms Martinez noting that Mr Bartlett's RAF has been completed for December/January with the next module die in February. Ms Martinez email to Mr Bartlett noting Ms Purcell has completed his RAF e-Train for December and January and deserve a thank you. Mr Bartlett responds by thanking Ms Martinez and asking Ms Purcell's last name and indicating 'done' when provided by Ms Martinez. See emails appended on Attachment 11.
• Email dated 5 January 2010 (7.35 pm) from Mr Bartlett to Ms Martinez stating 'Can u assist me on this or can wait til we return?' relating to General Security Awareness. See email appended on Attachment 12.
• Email dated 27January 2010 (4.15 pm) from Ms Martinez to Ms Purcell asking her to call in relation to Mr Bartlett's RAF. See email appended on Attachment 13.
• Email trail dated on 29 January 2010 (8.36am, 9.35am) from Mr Bartlett to Ms Martinez stating "U need to hear me here-plus yours as well' in relation to RAF e-Train on My PCard Module. Ms Martinez responds with 'Completed!' See email appended on Attachment 14.
• Email dated 1 February 2010 (6.30pm) from Mr Bartlett to Ms Martinez stating 'did u do this to me? or can u help me on wed.' in relation RAF due to expire. See email appended on Attachment 15.
• Email trail dated 3 February 2010 (8.02 am, 2.48pm, 2.52pm) from Mr Bartlett to Ms Martinez forwarding e-Train warning in relation to RAF expiry for General Security Awareness. Ms Martinez responds with 'done'. Mr Bartlett responds with 'u are the best'. See email appended on attachment 16.
• Email dated 12 March 2010 (5.29pm) from Ms Martinez to Mr Bartlett with the content Security Awareness Training. See email appended on attachment 17.

103 The material forwarded to Mr Corbally also contained Attachment 16 referred to in the above report. The attachment reproduced the following emails.

Attachment 16

From: Bartlett, Paul

Sent: Wednesday, 3 February 2010 2:52 PM

To: Martinez, Fiona

Subject: RE: WARNING: etrainPlus compliance course to expire within 5 days

u are the best

From: Martinez, Fiona

Sent: Wednesday, 3 February 2010 2:48 PM

To: Bartlett, Paul

Subject: RE: WARNING: etrainPlus compliance course to expire within 5 days

done.

Kind regards

Fiona

From: Bartlett, Paul

Sent: Wednesday, 3 February 2010 8:02 AM

To: Martinez, Fiona

Subject: FW: WARNING: etrainPlus compliance course to expire within 5 days

From: Learning Assist [mailto:[e-mail]]

Sent: Saturday 30 January 2010 6:48 AM

To: Bartlett, Paul

Subject: WARNING: etrainPlus compliance course to expire within 5 days

Dear Paul,

The following course is due to expire in the next 5 days. Once the course expires, you will be considered non-compliant in relation to this course.

Component Type: RAF Foundation

Course Name: General Security Awareness

Date Completed: 04-02-2009

Expires on: 04-02-2010

In order to avoid non-compliance:

• Please click on the etrainPlus link below
• https://www.anzetrain.com
• Login to etrainPlus
• Go to the Training Plan tab and click on the Re-register button
• The Re-register button will be replaced by "Register" button if there is a new version of the course.
• If you have any queries regarding this email, please contact your Line Manager.
• Please note: This is an automatically generated email. Do not reply to this email.
• Kind regards,
• Global Learning Hub

104 Mr Corbally was also provided with a copy of the letter of formal warning given to the plaintiff dated 22 April 2010. The letter included the following paragraph:

"This letter serves as a formal written warning that if there are any further instances of unacceptable behaviour by you in the future without an acceptable explanation, further disciplinary action may be taken up to and including termination of your employment."

105 After considering this material, Mr Corbally concluded that the plaintiff had lied to him about the reason for the prior warning.

106 Mr Corbally also concluded that the plaintiff had lied when he told him that the CBA had instigated the contact, since he was aware from seeing a copy of the email dated 22 June 2012 that it was the plaintiff who had initiated contact with the CBA. Mr Corbally no longer felt that he could trust the plaintiff. He was not particularly concerned about the contact of itself, but rather that the plaintiff had lied to him about it.

107 Mr Corbally considered the Investigation Report, Ms Novotny's report, the letter that contained the formal warning, the extracts of the E-train investigation report that had been provided to him by Ms Carpio, the email the plaintiff had sent to the CBA on 22 June 2012 and what the plaintiff had said to him in the course of the meeting about the E-train incident and the contact with the CBA. By this time, Mr Corbally was almost certain that the plaintiff had prepared and posted the doctored email and envelope to Mr Cranston. However, he considered that even if the plaintiff was not responsible for it, he did not trust him anymore. He regarded it as very important that he be able to trust a person in the plaintiff's position because of the role the plaintiff played in the ANZ's business. Accordingly he decided to terminate the plaintiff's employment without notice for serious misconduct.

108 When the meeting resumed after the break the following exchange ensued:

Mr Corbally: Is there anything else you would like to tell me?

Mr Bartlett: No, we would just be going over old ground.

Mr Corbally: I have taken into account everything that you have said to me today, and what you have said in previous discussions with me. I have also considered the Handwriting Report and Investigation Report.

I am considering termination without notice. Is there anything you would like me to consider before I make that decision?

Mr Bartlett: I am shell-shocked. I am disappointed that I have lost your support and ANZ's support. I didn't do it. Give me the opportunity to do my investigation. I will prove to you that I am a victim.

Mr Corbally: On the basis of what you have said, there is no reason for me to change the outcome. Your employment is terminated without notice for serious misconduct. You will be paid your salary up to today, as well as your accrued leave entitlements, but you will not receive any payment for notice of termination. I also remind you of your obligations in relation to confidentiality and non-solicitation under the contract.

Mr Viney: What is your address for service? I could prove that a pussy cat wrote the Handwriting Report.

109 The following day a letter of termination was couriered to the plaintiff's residence.

The aftermath

110 The plaintiff contacted Mr Dyki in September 2012 and asked him about the IPG team. In the course of the discussion, the plaintiff told him that he had been to Queensland to see Mr Cranston. The plaintiff showed Mr Dyki a copy of the doctored email and the envelope and said:

"You can see it is an amateur letter with irregular font, I would never produce something like this."

The credibility of witnesses

The plaintiff's credibility

111 The plaintiff sought to advocate his case in the course of his cross-examination. He rarely gave a direct answer to a question and tended to respond to propositions by referring to extraneous matters which were not responsive. He gave me the impression that he was accustomed to being believed and that he was affronted by any challenge to his veracity. He took umbrage when asked directly about matters and appeared to regard it as unfair that he be required to respond to any allegation unless he had been given advance warning of all material in the ANZ's possession that was germane to his answer. His attitude in that respect is revealed in the following exchange from his cross-examination:

"Q. If you go to the fifth paragraph [of the letter dated 10 August 2012] it says, "During this interview the allegations will be detailed to you and you will have a full and complete opportunity to respond"?

A. Yeah, sorry, yeah, but I didn't know what the allegations were.

Q. You didn't know what the allegations were?

A. No, at that meeting, halfway through the meeting they outlined the forensic handwriting report. That's the first time I've heard--

Q. You knew, didn't you, that the meeting that you had been asked to attend related to the sending of the doctored email?

A. Sorry, I knew it was relating to the doctored email but I didn't know what evidence or what, what it related to specifically.

Q. You knew that the purpose of the meeting was to put allegations to you in respect of your involvement in the doctored email, I suggest?

A. Yes."

112 He also used his undoubted intelligence to "spin" his answers which were, at times, irreconcilable with objective facts. For example, when Mr Murdoch, who appeared on behalf of the ANZ, put to him in cross-examination that Mr Law was a person who was influential in whether he obtained an RPO 1 or 2, he would not even concede that. All that he was prepared to accept was that Mr Law's opinion was a "factor". I formed the impression that he was conscious that if he were perceived to have any animus against Mr Law, this might provide a motive for sending the doctored email because of its potential to damage Mr Law's reputation as well as the ANZ's. Accordingly, he was reluctant to concede the obvious: that Mr Law played an influential part in the plaintiff's RPO assessment each year, since the plaintiff reported directly to him.

113 Even when confronted with compelling contemporaneous or incontrovertible evidence, he refused to make concessions and fashioned his explanation depending on the circumstances. He gave various explanations for the E-train allegation, his conduct and the formal warning, including the following:

(1) In the preliminary interview on 16 July 2012 the plaintiff told Mr Peacock and Mr Smith that he had received a warning for his involvement in the etrain investigation and that he had escaped a more severe reprimand as he was acting under Mr Giovas's instruction.

(2) In cross-examination on 10 November 2014 the plaintiff said:

"A. The situation with RAF is that I was given a formal warning 'cause I turned a blind eye whilst I was overseas for two months and my PA did four programs. I then my punishment was to redo them, which I did them, and I received this letter.

Q. How long were you away for, sorry?

A. For about two months. I was in Asia visiting five countries on business for most of December and in January in Europe with my family, of which when I had a number of technical problems as I had in the past 12 months. When I came back my PA had taken it upon herself to do or fix the problems as I thought, but she had actually redid them.

Q. So is it your evidence that you only became aware of this after you returned?

A. That's when I found out when I thought that they would either be I had been given an extension of time or the technical problems of which I experienced, which was the exams were done but were reflecting incomplete on the, the internal web, web link. When I returned they were seen to be done, so and I was given a warning because I didn't report my secretary."

114 I regard the emails which have been reproduced above as establishing that the plaintiff asked Ms Martinez to do the training for him and praised her for having done it for him. It was not a question of his turning a blind eye at all, or acting under Mr Giovas' direction. Other emails in evidence bearing dates in December 2009 also establish that the plaintiff's RAF training had been done by Sulu Purcell. Mr Fernon sought to defend the plaintiff's answers by reference to the wording of the formal warning letter of 22 April 2010 as follows:

"I have found that you were aware that other employees within IPG were completing your Risk Accreditation Framework (RAF) courses on your behalf, and that you turned a 'blind eye' to the unacceptable behaviour of other employees. I find this conduct unacceptable and disappointing."

115 The wording of the formal warning was more charitable to the plaintiff than the underlying material warranted. However, this circumstance did not provide an excuse, much less a justification, for the plaintiff to misrepresent what actually occurred since he, of all people, knew what had happened and was party to the emails that incriminated him.

116 I also considered that there were times when the plaintiff was, though not actually dishonest, nonetheless unreliable. His meeting with Mr Corbally on 13 June 2012 provides an example. Mr Corbally was investigating the plaintiff's aspirations with a view to succession planning. His inquiry of the plaintiff whether he would like Mr Law's job was made for that purpose. However, the plaintiff may well have understood it at the time to be an offer of Mr Law's job. He appeared to have a somewhat elevated view of his capacity and importance which may have contributed to this misapprehension. For example, he told Mr Corbally on numerous occasions that his business was more important than any other business in the property team, that it was a good business and that he ought receive preferential treatment over the leaders of the other teams.

117 A second example can be found in the plaintiff's evidence of a meeting which was said to have occurred between him and Mr Law in 2011 at which Mr Law allegedly provided him with confidential succession planning documents and, according to the plaintiff, said the following:

"Your star is shining internally . . . you are wanted in many areas and you are being discussed internally in other groups to take over their positions. That should make you happy."

118 I accept Mr Law's evidence that he neither gave the documents to the plaintiff, nor said the words attributed to him. It is possible that the plaintiff mistakenly construed some praise or encouragement that Mr Law had given him as amounting to a prediction, or promise, of future prospects. It is also conceivable that the plaintiff wishfully, but unwittingly, reconstructed the past and transformed what Mr Law had actually said into a statement that corresponded with the plaintiff's own ambitions. Whether this evidence was the result of a deliberate falsehood, a mistaken recollection affected by self-interest or a delusion need not be decided. I regard the plaintiff's evidence on this, and other matters, as unreliable.

119 For these reasons I do not accept the plaintiff's evidence except where it is either corroborated, consistent with the objective facts or amounts to a statement against interest.

The credibility of the ANZ's witnesses

120 These witnesses can be dealt with together because the impression I have formed of them is broadly similar: they gave honest and reliable evidence.

121 I regarded Mr Smith as being a reliable witness who set out the investigation in a non-partisan, professional manner. He was not defensive in giving his evidence and made appropriate concessions, including when he could not recall certain matters. I accept his rejection of the suggestion put to him in cross-examination that what he was doing was building a case against the plaintiff "from the very beginning". I also formed a favourable view of Mr Thompson, the IT expert who conducted the IT investigation. He was prepared to concede the possibility that the doctored email had been typed independently although he obviously regarded it as highly unlikely having regard to the appearance of the document.

122 Mr McGowan, who was responsible for the Investigation Report provided to Mr Corbally, was cross-examined about the investigation generally. Various alleged deficiencies were put to him. I formed the view that he was not defensive about what had and had not been done. For example, when it was put that he ought to have done a sweep of the Sydney floor to determine whether there were any other hard copies of the real or doctored emails he responded: "I did not consider that to be a realistic avenue of inquiry." It was put to him that there were many things he did not think were realistic possibilities. I accept his response, which was as follows:

". . . we had an open mind, we considered all options and we looked at the available evidence and followed the avenues of inquiry that presented and we ran them through."

123 I also accept the following evidence which Mr McGowan gave in response to the suggestion that he pre-judged the plaintiff's guilt:

"No, we followed - we are an independent investigation unit within the bank. We were tasked to investigate a matter. There were no suspects identified, so in some ways it's a little unusual. We generally act on complaints. This was a, an issue that had been identified - can we identify the source? We started with the original source of the email, we went through the ten that received it. The logical avenue of inquiry continued on through to Paul and in my opinion there was sufficient evidence that showed he was the author of the letter."

124 Mr Law gave his evidence in a straightforward way. He readily conceded when he did not recall what was put to him. I accept his evidence and, in particular, his denials of the plaintiff's versions of conversations they had. I did not gain the impression that the plaintiff's considerable antipathy towards Mr Law was reciprocated. Mr Law disapproved of the plaintiff's aggression and lack of civility to Credit Risk because of its potential to harm IPG and did not trust the plaintiff's word but otherwise appeared to be able to work with him in the spirit of professional comity.

125 Mr Corbally was an impressive witness. He was not defensive about either the process or his decision, which he regarded as amply supported by the material he had to hand. He relied on others to perform their tasks competently and was prepared to accept and act on the advice he received from Mr McGowan, Mr Smith and Ms McDonald as to the state of the investigation and the steps that ought to be taken. I accept his reliance on Ms Novotny's opinion. I also accept that his view that he was entitled to rely on a well-regarded independent expert was genuinely held. Although he was privy to the theories of the investigators that the plaintiff had brought up red herrings and was trying to implicate others, I did not get the impression that he placed any particular weight on these matters as opposed to Ms Novotny's evidence or his own impression of the plaintiff's credibility and his conclusion that he had lied to him. For the reasons given above I accept his recollection of what the plaintiff said about the contact with the CBA although it was not recorded in the notes prepared by Ms Thomas.

The contract of employment

126 On 4 December 2008 the plaintiff signed a written contract of employment with the ANZ contained in a letter dated 25 November 2008. It relevantly provided that the letter set out the terms of his employment and constituted his employment agreement with the ANZ. Clause 3 provided that the details of his remuneration were set out in Schedule A, which formed part of the agreement.

127 Clause 8 relevantly provided:

8. Values and Ethical Standards

8.1 Conduct

ANZ has developed guiding values and ethical standards which you are required to maintain. You must ensure they are an integral part of the way that you, and those who report to you, carry out duties within ANZ.

You must at all times act honestly and in a manner that is consistent with the status of your position with ANZ. Further, you must faithfully and diligently to [sic] perform your duties, exercise your powers, and manage with integrity and respect all matters concerning ANZ employees and customers.

. . .

128 Clause 10 relevantly provided:

10.1 Codes, Policies and Procedure

In addition to the terms and conditions contained in this employment agreement, ANZ has codes, policies and procedures that apply to your employment (although, unless stated otherwise, they are not specifically incorporated into this employment agreement). These codes, policies and procedures may be varied by ANZ from time to time.

You must read, and be familiar with, all ANZ codes, policies and procedures as varied from time to time.

. . .

129 Clause 14 relevantly provided for termination of employment as follows:

14.1 Termination Entitlements

Your termination entitlements will depend upon the circumstances of the termination and are set out in this clause. Your entitlements (if any) to deferred shares and options upon termination of employment will be determined in accordance with the terms of the Employee Share Acquisition Plan (ESAP) and the Employee Share Option Plan (ESOP), as varied from time to time at ANZ's sole discretion. No other entitlements, benefits or any other form of compensation will be payable to you upon the termination of your employment with ANZ.

. . .

14.3 Termination by ANZ

a. Termination with Notice

ANZ may terminate your employment for any reason by giving you 4 months' written notice. Alternatively, ANZ may elect to provide you with payment in lieu of notice or a combination of notice and payment in lieu of notice. Payment in lieu of notice made under this clause will be calculated on the basis of your Total Employment Cost (TEC) as described in Schedule A.

During the notice period or any part of it, ANZ may direct you not to perform all or part of the duties of your position, to cease communication with customers, suppliers, employees and contractors of ANZ and not to attend your principal place of work.

b. Immediate Termination Without Notice

ANZ may terminate your employment at any time, without notice, if, in the opinion of ANZ, you engage in serious misconduct, serious neglect of duty, or serious breach of any of the terms of this employment agreement. In such circumstances, you will be entitled to payment of your total Employment Cost (TEC) (as described in Schedule A) up to the date of termination only.

Whether the plaintiff has established that the ANZ repudiated his contract of employment

Onus of proof

130 It was accepted that, by reason of the gravamen of the allegation, serious misconduct, and the nature of the contract, one of employment, the ANZ bore the onus of establishing that it was entitled to terminate the contract and therefore that the conditions for termination for serious misconduct had been met: Blyth Chemicals Ltd v Bushnell (1933) 49 CLR 66 at 83 per Dixon and McTiernan JJ; North v Television Corporation Ltd (1976) 11 ALR 599 at 603 per Smithers and Evatt JJ; see also the authorities referred to in Pastrycooks Union v Gartrell White (No. 3) (1990) 35 IR 70 at 83-84 per Hungerford J.

The construction of clause 14.3(b)

The meaning of the words "in the opinion of the ANZ"

131 There is an issue about the circumstances which entitled the ANZ to terminate the plaintiff's employment contract under cl 14.3(b). The plaintiff's primary submission was that the ANZ was only entitled to terminate the contract if it could prove that he was actually guilty of serious misconduct. In the alternative, the plaintiff contended that if the ANZ could terminate on the basis of its opinion that the plaintiff was guilty of serious misconduct, such opinion had to be reasonable, correct, formed in good faith, with proper regard for the plaintiff's interests and in compliance with the Performance Policy and neither capricious, arbitrary nor unreasonable. The ANZ contended that it needed only to prove that, on 15 August 2012, it held the opinion that the plaintiff was guilty of serious misconduct.

132 The relevance of the distinction is immediately apparent. If the ANZ's construction is to be preferred then, as long as I consider that Ms Novotny's report formed at least part of the basis for the ANZ's opinion, and that Mr Corbally, who was relevantly the mind of the ANZ at the time of termination, held the opinion on the basis of Ms Novotny's report that the plaintiff was guilty of serious misconduct, then the ANZ was entitled to terminate the contract. The fact that Stephen Dubedat, the forensic handwriting expert retained by the plaintiff, held a different view, does not convert the ANZ's termination into a breach, even were I to prefer his opinion to that of Ms Novotny.

133 Mr Fernon submitted that the words in cl 14.3(b) "in the opinion of" added nothing to the clause and that what was important was the underlying fact, not whether the ANZ did or did not hold an opinion about the underlying fact. Mr Murdoch relied on the fundamental principle that a document ought be read as a whole and that words ought be given a meaning. He submitted that it ought not be inferred that the words "in the opinion of" were mere surplusage.

134 In my view, the words "in the opinion of" are not gratuitous. There is nothing surprising or uncommercial about giving the words their full force and effect, having regard to the nature of the contract and the capacity of the employee's conduct to affect the reputation of the ANZ, both in its capacity as an employer and as a bank. In Interstar Wholesale Finance Pty Ltd v Integral Home Loans Pty Limited [2008] NSWCA 310; 257 ALR 292 the Court of Appeal considered a clause which permitted Interstar immediately to terminate a loan origination and management agreement in circumstances which included the following:

(c) where the Originator or Originator's Representative has engaged in any proven deceptive or fraudulent activity in relation to an Application or a Settled Loan or Interstar considers, in its reasonable opinion, that the Originator or Originator's Representative has engaged in deceptive or fraudulent activity in relation to an Application or a Settled Loan.

135 At [96], Allsop P, Giles and Ipp JJA agreeing, said:

"Here, the second branch of cl 20.1(c) is a state of affairs or circumstance dependent upon the state of mind of Interstar and there being sufficient grounds to make it a reasonable opinion. It does not depend upon there being a breach of contract, or upon Interstar or its Originator's Representative having in fact engaged in deceptive or fraudulent activity. Evidence for fraud and evidence for an opinion that fraud has occurred may be quite different. What might well reasonably support an opinion may well be entirely inadequate to conclude that fraud occurred."

136 The meaning the words "in the opinion of the ANZ" add to cl 14.3(b) clause is that the underlying fact is not the determining matter; rather, the relevant fact is whether, in the opinion of the ANZ, the plaintiff was guilty of serious misconduct. This is an important distinction. To adopt and adapt the words of Allsop P from the passage quoted above, what might reasonably support an opinion may well be entirely inadequate to conclude that the plaintiff was guilty of serious misconduct.

137 A similar clause arose in Australian Workers' Union v Bowen (No. 2) (1948) 77 CLR 601 in the context of a trade union rule which relevantly provided that a committee of management "may dismiss from membership any member of the union who in its opinion is guilty of misconduct". On the question of construction of that rule, Latham J said at 606:

"There is no doubt that in fact the Executive Council did form this opinion. If the rule had provided that a person who was guilty of misconduct could be expelled (without the express reference to the opinion of the adjudicating body) there would have been room for an argument that the decision of whether particular behaviour amounted to misconduct was not committed to that body but that it could be independently examined in a court. The terms of the rule, however, do not leave room for such an argument and the only question (so far as the terms of this rule are concerned) is whether the Executive Council was really, i.e. bona fide, of opinion that the applicants had been guilty of misconduct."

[Emphasis added.]

Whether there was an implied term that the ANZ's opinion in cl 14.3(b) had to be correct, reasonable, formed with proper regard to the interests of the plaintiff and neither arbitrary nor capricious

138 Mr Fernon submitted that there was an implied term in the contract that the opinion was required to be reasonable, correct, formed in good faith, with proper regard for the plaintiff's interests and in compliance with the Performance Policy and neither capricious, arbitrary nor unreasonable.

139 Before a term can be applied it must satisfy the tests set out in B.P. Refinery (Westernport) Pty Limited v Hastings Shire Council (1977) 180 CLR 266 at 282-283; Codelfa Construction Pty Limited v State Rail Authority of NSW [1982] HCA 24; 149 CLR 337 at 347 as follows:

(1) it must be reasonable and equitable;

(2) it must be necessary to give business efficacy to the contract, so that no term will be implied if the contract is effective without it;

(3) it must be so obvious that 'it goes without saying';

(4) it must be capable of clear expression;

(5) it must not contradict any express term of the contract.

140 I reject the submission that there was an implied term that the opinion was required to be "correct" since this would have the same effect as deleting the words "in the opinion of the ANZ" from cl 14.3(b) and would therefore fail the fifth test as contradicting an express term of the contract.

141 For the same reasons I reject the submission that there was an implied term that the opinion in cl 14.3(b) was required to be formed in accordance with the Performance Policy. Clause 10.1 of the contract provides that, unless otherwise stated, the policies are not incorporated into the contract. Accordingly, no term can be implied which imports the Performance Policy into the contract. The proposed term would not otherwise satisfy the tests for implying a term.

142 Whether there is an implied term that the opinion must be reasonable, formed in good faith and neither arbitrary nor capricious is a more difficult question. Whether contractual powers and discretions may be limited by good faith and rationality requirements adopted and adapted from public law is not settled. Nor was it the subject of argument in Commonwealth Bank of Australia v Barker [2014] HCA 32 at [42] per French CJ, Bell and Keane JJ and [107] per Kiefel J.

143 I am not satisfied that any such term ought be implied. It does not meet any of the tests for implied terms set out above. In my view, the only question under cl 14.3(b) is whether the ANZ actually held the opinion that the plaintiff was guilty of serious misconduct. If bad faith could be established, this would tend to gainsay a conclusion that the ANZ actually held the requisite opinion, which would have to be held, as Latham J said at 606 in Australian Workers' Union v Bowen, "bona fide". However, to require that an opinion be held "bona fide" does not import the requirement that it be formed, as opposed to held, in good faith.

Conclusion: the opinion of the ANZ

144 I am satisfied that Mr Corbally, who was relevantly the mind of the ANZ, held the opinion that the plaintiff was responsible for sending the doctored email to Mr Cranston. It is common ground that this amounted to serious misconduct within the meaning of cl 14.3(b). Accordingly, the ANZ was entitled to terminate the plaintiff's employment without notice. There ought, accordingly, be judgment for the ANZ.

145 This is sufficient to dispose of the proceedings. However, as trial judge I am obliged to make all findings of fact in order that, even if a different view is taken on construction or liability, the matter can be disposed of finally. Accordingly, what follows in these reasons are findings which fall into this category.

Subsidiary findings on breach if a different view is reached on construction

146 In case a different view is reached on construction it is appropriate that I record further findings, which do not arise on my construction of the contract set out above.

147 If the opinion was required to be held on reasonable grounds, then I find that it was. Although it might be accepted, and indeed was an agreed fact, that a different expert could come to a different view from that expressed by Ms Novotny in the 9 August 2012 report, it does not follow that ANZ was obliged to give the plaintiff an opportunity to obtain his own expert report before it formed an opinion under cl 14.3(b). Ms Novotny was an independently engaged, renowned, highly expert, well qualified and experienced forensic document examiner. It was reasonable for Mr Corbally to rely on her opinion, which was expressed in sufficiently strong terms to entitle him to be comfortably satisfied that the plaintiff was the culprit.

148 Mr Corbally's opinion was neither capricious, nor arbitrary. It was held in good faith. The chronology of events and the course of the investigation which I have set out above show the care with which the ANZ approached the task of identifying the culprit. I do not regard Mr Corbally as having pre-judged the issue. Nonetheless he was concerned to ensure that the ANZ's investigation would not be constrained by the announcement of the results of the restructure. His requirement that each recipient of the email sign a statutory declaration was, in these circumstances, prudent.

149 It was suggested that it was not reasonable for Mr Corbally to conclude that the plaintiff had lied about contact with the CBA and further, as I understood the submission, that the plaintiff ought not to be criticised for approaching the CBA in circumstances where a restructure was imminent in the course of which he could have lost his position. It might be accepted that there can be a degree of unfairness in questioning employees about whether they have approached other employers, particularly when their employer has not assured them of continued employment. In this regard, I accept the plaintiff's evidence that, when Mr Law asked him if he had contacted the CBA, he considered it to be none of Mr Law's business. However, where an employee, who is in a position of trust, as the plaintiff was, lies to his or her employer, issues of trust and integrity arise. My impression was that Mr Corbally was indifferent to whether the plaintiff had contacted the CBA except in two respects: first, he regarded it as irreconcilable with the plaintiff's contention that Mr Corbally had offered him Mr Law's job on 13 June 2012; and secondly, he considered, in my view justifiably, that the email of 22 June 2012 to the CBA established that the plaintiff had instigated the contact and the plaintiff denied that he had, to Mr Corbally. In these circumstances I am not persuaded that it was unreasonable for Mr Corbally to take these matters into account. In any event, the ANZ's termination was justified on the basis of the doctored email and did not depend on Mr Corbally's opinion that he had lied about other matters.

150 It was put to Mr Corbally that it was unfair of him not to put the email the plaintiff had sent to the CBA on 22 June 2012 to the plaintiff in the course of the meeting on 15 August 2012 and that not putting the email to him did not comply with the requirements of procedural fairness in the Performance Policy. Mr Corbally rejected the proposition that the policy required that to be done and said that he did not think that it was unfair of him not to raise it. Nor did he regard it as unfair that he did not, in the meeting of 15 August 2012, show the plaintiff the investigation report relating to the RAF training which led to the formal warning in April 2010. It was also put to Mr Law in cross-examination that he ought to have shown the email to the plaintiff at the time of the conversation where the plaintiff denied recent contact as a matter of fairness. Mr Law denied this proposition and said that, as far as he was concerned, it was a matter pertinent to trust. He explained further that he was obliged, under the terms of the investigation, not to divulge what the investigation had discovered, including the plaintiff's email to the CBA, and that he was, accordingly, prohibited from revealing to the plaintiff that he and the investigators were aware of it.

151 I am not persuaded that the Performance Policy required the ANZ to provide the plaintiff with a copy of Ms Novotny's report (as opposed to drawing her conclusions to his attention, as was done). It was sufficient, in my view, for her findings to be drawn to his attention. Nor am I persuaded that the Performance Policy required the ANZ to afford him the time and opportunity to retain an expert to prepare a report which would then be considered by the ANZ before it could form an opinion whether to terminate his employment. In my view, in so far as the Performance Policy required procedural fairness to be afforded to the plaintiff, it was. Accordingly, even had I been persuaded (contrary to the view I have expressed above) that such a requirement was either imported into the contract or otherwise applied, I would not have been satisfied that there was a breach.

The underlying fact: whether the plaintiff sent the doctored email

152 If I had accepted the plaintiff's contention that the ANZ was required to prove the underlying fact, it would be necessary to determine whether the plaintiff was responsible for sending the doctored email. This question arises only if I am wrong about the issue of construction referred to above. Its determination requires an examination of the evidence adduced in these proceedings, some of which was not available to Mr Corbally on 15 August 2012.

The additional evidence: the further reports of Ms Novotny and Mr Dubedat

153 The additional evidence is substantially comprised of the further reports of Ms Novotny and the reports of Mr Dubedat. The plaintiff's case was that the ANZ has not only failed to establish that the plaintiff was responsible for sending the doctored email, but it has failed to exclude all possible suspects and that, accordingly, it cannot be concluded that the plaintiff was responsible. The plaintiff contended that Mr Dubedat's opinion ought be preferred to Ms Novotny's and that, accordingly, the ANZ has failed to prove that the plaintiff was responsible for the handwriting on the envelope in which the doctored email was sent to Mr Cranston. The ANZ contended that Ms Novotny's opinion that the plaintiff was almost certainly the author of the questioned handwriting ought be preferred to that of Mr Dubedat, who considered the evidence to be inconclusive. Further, the ANZ contended that it has excluded, by evidence, or reasonable deduction from evidence, all hypotheses consistent with the plaintiff's innocence on the balance of probabilities. The ANZ accepts that, because of the gravity of the allegation, it is appropriate to apply the principles referred to by the High Court in Briginshaw v Briginshaw (1938) 60 CLR 336.

154 The principal disagreement between the experts relates to their opinion regarding the letters "G", "B" and "J". Mr Dubedat considered these letters in the specimen documents to be consistently different in structure from those in the questioned document. Both experts were provided with the plaintiff's notebook as well as other documents that comprised the specimen handwriting with which a comparison with the questioned handwriting was to be made.

155 Mr Dubedat extracted examples of the contested letters from the first forty pages of the notebook only and then compared these with the questioned handwriting. He adopted a mechanical approach of confining the comparison by a strict "like for like" rule. Accordingly, he refused to countenance a comparison between cursive and printing, or upper case and lower case. He referred to texts in support of his "rules".

156 However, Mr Dubedat agreed with the following propositions from the seminal text, Wilson R Harrison, Suspect Documents - their scientific examination, (1966, Sweet & Maxwell London):

"This rule must not be applied blindly. For example, the dissimilarity must be present in some feature which is known to the examiner to be fundamental to the structure of the handwriting. The presence of initial strokes to some of the letters of one specimen of handwriting and their absence in the other is not fatal to expression of opinion that they're of common authorship for the experienced examiner is aware that many writers vary their habits with respect to initial strokes to certain letters. . .

The type of dissimilarity which is regarded as most significant is that which has to be sought for in the structure of the handwriting and whose presence may well be overlooked by those inexperienced in the critical examination of handwriting."

157 Ms Novotny's approach was more nuanced. She described the task she performed as being a matter of examining the specimen material and the questioned material and determining whether or not the features and range of variation in the latter could be accounted for by what appears in the former. In her view it could be a matter of judgment whether a letter was upper or lower case or cursive or printed and that, in some circumstances, a comparison could usefully be made between letters in different categories. She regarded the specimen and questioned handwriting as containing a mixture of styles, both printed and cursive and connected printing. Her interpretation of the "like with like" principle is that an expert needed to consider each case on its own merits and that it was a matter of judgment whether it would be appropriate to make a cross-comparison. She referred to the same texts as had been relied upon by Mr Dubedat and pointed to passages that permitted such judgments to be made.

158 Further, unlike Mr Dubedat, Ms Novotny considered there to be sufficient examples in the question writing to make a judgment based on the comparison with the specimen handwriting. She did not regard the limitation in the number of characters and numerals in the question writing as a significant limitation on the strength of her conclusion that it was almost certain that the plaintiff wrote the envelope.

159 Mr Fernon sought to impugn Ms Novotny's evidence on the basis that she had not recorded her observations and reasoning process sufficiently. I accept her response as follows:

"There can always be more detail in the written notes in any one case file but the notes that are prepared are notes to reflect parts of my thoughts that identify features that I need to come back to and spend more time assessing. But in order to produce a set of notes that completely reflected all aspects of my consideration of the examination would be volumes. For even the smallest of handwriting jobs, it would be a very big and large task."

160 Ms Novotny agreed that a fundamental and consistent difference between the questioned handwriting and the specimen handwriting amounted to powerful evidence of a different hand. However, she explained that there was commonly an issue whether a difference ought be characterised as a "fundamental" one (which implied different writers) or an "unaccountable" one, which could be caused by a number of reasons, including accident, insufficient sample, self-serving specimen writing, disguise, illness or nervousness.

161 Mr Fernon put to Ms Novotny that the value of experience ought not be overstated. Her response, which I accept, was:

"It's a very important part of the learning process of how to interpret the significance of observations. It's one thing to be able to assess and compare a questioned handwriting with a specimen handwriting and say this is similar, this is different, but what it comes down to is what are the significance of those similarities and those differences. So the, the determination of similarity and difference is somewhat objective. It's the interpretation which is where the experience comes into it, and that's, that's why there's not a lot of detail in it, in the textbooks, because you can't learn it from a textbook. You need to learn it from practical experience."

162 It was suggested to Ms Novotny that the opinions she gave in reports subsequent to her first report of 9 August 2012 were, in substance, designed to substantiate the opinion expressed in her first report. I accept Ms Novotny's response as it appears in the following exchange in her cross-examination:

FERNON: You'd agree, wouldn't you, it would've been embarrassing for you if you had withdrawn or reduced your opinion of highly probable given on 9 August 2012?

WITNESS NOVOTNY: Not at all. If, if I thought there was scope or need for me to change my opinion in a direction other than strengthening it, then I would've done so.

163 I prefer the evidence of Ms Novotny, principally on the basis of what I consider to be her greater expertise. She impressed me as a truly independent witness who was neither defensive nor partisan. Her expression of a relatively strong view that the plaintiff wrote the envelope is, in my view, not only reliable, but also compelling. Although I accept that Mr Dubedat was not able to come to such a conclusion, I consider that his tentativeness and diffidence was a result of his lesser expertise when compared with that of Ms Novotny.

The unchallenged additional evidence of Ms Novotny

164 Following the commencement of these proceedings, Ms Novotny undertook a further analysis since the original envelope (the questioned document) was provided to her. She also undertook an analysis and comparison of specimen handwriting which had been obtained from all other employees of the ANZ who had had electronic access to the email. I accept her unchallenged evidence as to the other analyses, each of which was independent of the other, which was as follows:

Name of person	Conclusion as to whether person wrote questioned envelope
Adrian Blake	Highly unlikely
Duncan Caldwell	Unlikely
Adam Cotterell	Unlikely
Nicole Khalife	Unlikely
Matthew Lawrence	Highly unlikely
Fiona Martinez	Highly unlikely
Danielle McCormack	Unlikely
Chris Rees	Highly unlikely
Mark Sample	Highly unlikely
Steven Wiltshire	Unlikely

165 Ms Novotny explained the terms "unlikely" and "highly unlikely" in the following extract from Appendix B:

Unlikely (qualified negative conclusion). "I concluded that it is unlikely that the writer of the specimens wrote.."	That is to say, it is probable that the questioned writing/signature was written by a person other than the writer of the specimens. Significant differences were found between the questioned and specimen writing/signatures, but there is a significant limiting factor, such as a relatively small amount of writing in question and/or when the questioned document is a reproduction
Highly unlikely (qualified negative conclusion). "I concluded that it highly unlikely that the writer of the specimens wrote.."	That is to say, it is highly probable that the questioned writing/signature was written by a person other than the writer of the specimens. This is where I consider the differences are so profound and numerous that I am almost certain that the writer of the specimens was not the writer of the questioned writing/signature.

166 Accordingly, in my view, the ANZ has proved, on the balance of probabilities, that none of the persons who had electronic access to the email, apart from the plaintiff, was responsible for the doctored email.

Conclusion regarding the underlying fact: whether the plaintiff sent the doctored email

167 ANZ has established to the requisite standard that the plaintiff was responsible for the doctored email. I accept the evidence of Ms Novotny that she was "almost certain" that he was the writer of the questioned envelope. This is enough to discharge the onus of proof. However, if there were any doubt on the question (although the standard is not beyond reasonable doubt), such doubt is, in my view, resolved by the following additional matters.

168 The plaintiff had an undoubted opportunity, as a recipient of the email, to doctor and print it without saving it and therefore avoid detection by the IT systems then in place. There is no evidence that the plaintiff knew that he would not be able to be detected if it was done this way and this may account for his demeanour in the preliminary interview on 16 July 2012. He lived in Sydney and therefore could have posted it from Sydney to Brisbane without requiring any assistance from others. He knew that Mr Cranston was in Brisbane and knew the AFR's postal address. The plaintiff had known Mr Cranston since he was a junior journalist in Sydney before he transferred to Brisbane. When Mr Cranston was in Sydney he had often called the plaintiff for guidance, both as to the state of the property market and matters of banking terminology which, as the plaintiff put it "he [Mr Cranston] could have got out of an MBA education but never did". They were still in touch after Mr Cranston moved to Brisbane, although not as regularly.

169 Motive is not a matter that needs to be proved before culpability is established. Nonetheless it is a relevant matter. The plaintiff contended that the doctored email was a childish attempt and that, had he been responsible, he would have added more into it. He criticised the fact that a different font was used and appeared to be offended by the suggestion that he would be associated with such a shoddy piece of work as the doctored email, which he described as "a very sloppy sham email".

170 These matters go both ways. Any person employed by the ANZ who created the doctored email would know, or reasonably expect, that detection would lead to dismissal for serious misconduct. Accordingly, such a person could be expected to disguise the provenance of the doctored email. What better cover, one might ask rhetorically, than for an articulate person, to use unsophisticated language in a doctored email? Too much detail, or detail that was too astute, or known only to the inner circle, would tend to reveal the identity of the creator. It might be asked why someone as clever as the plaintiff would write the envelope by hand rather than, for example, type an address label. There was no evidence that the plaintiff was particularly adept at typing or document preparation. He used the services of an EA. To require someone else to type a label or write the envelope would be to incur a greater risk of detection. Further he may well not have contemplated either that Mr Cranston would call Mr Lawrence or that he would retain the incriminating envelope.

171 I accept as plausible the hypothesis ventured by Mr Blake to Mr McGowan that the plaintiff had much to lose from the ANZ's tightening of its requirements for proposed loans by reason of its concern about its balance sheet since he had several transactions which might be affected by the direction. The plaintiff might have thought that, if the substance of the doctored email was reported in the AFR, the ANZ would relax the restrictions. This would have been to his benefit. I do not consider that any animus he felt towards Mr Law would otherwise have been sufficient for him to send the doctored email without this personal motive but I do not consider that the plaintiff had any aversion to damaging Mr Law.

172 I do not accept the plaintiff's evidence that he did not regard the email of 20 June 2012 as a concern because his portfolio of clients had a return of 28-30%. Mr Dyki, who was in his team, was clearly concerned. Furthermore the plaintiff recorded in his notebook the following entries, which I regard as inconsistent with his evidence that he was unconcerned:

"21/6/12 My office

Dyki concerned about Eddie news [email of 20.6.12]

How we manage pipeline and client deals. ROE [return on equity]

The clients expect we close 22/6/12

Sample [Mark Sample] bottoms up report, new loans v/s [versus] run offs. Good. Staff v. worried."

"28/6/12

Spoke to Eddie Law about team disharmony + unrest on balance sheet and loan reduction.

-He doesn't care their view.

Get team to help + go to Eddie [Law] direct.

[Mark] Sample/ [Brett] Corfield [Jason] Dyki [James] Amati [Grace] Irvin Stevie B [Bougoukas], Leo [Zygouras] etc."

"28/6/12

Brett [Corfield] worried talk to Eddie [Law]- Budget and Revenue concerns."

"[note also made on 28 June 2012]

-Law asks do I know Matt Cranston AFR. Nope

-Sent 20/6/ email

-Saw copy- bull. Nope

-Told it would kill our NSW biz [business]- largest limit, largest revenue largest cross sell

-Staff pissed clearly."

173 Each of Messrs Sample, Corfield, Dyki and Amati worked with the plaintiff. I do not accept the plaintiff's evidence that he sent his people to Mr Law to advocate on behalf of Mr Cotterell's group. In my view, these notes showed that the plaintiff's own team was worried by the 20 June 2012 email, and with good reason, since it would affect its financial performance and the prospects, and level, of bonuses for its employees. I also regard the plaintiff's false denial to Mr Law on 28 June 2012 that he knew Mr Cranston as amounting to a consciousness of guilt. At that stage, the investigation had not yet commenced and the plaintiff would have been unlikely to appreciate the extent to which his allegations would be investigated or the seriousness with which the ANZ would regard the sending of the doctored email.

174 Further, the ANZ has, by the unchallenged evidence of Ms Novotny, excluded all other persons who, on the basis that they had electronic access to it, could reasonably be suspected of having doctored the email. The plaintiff was not prepared to postulate any particular suspect, although he, personally and through his counsel, cast aspersions on several people, including, most improbably, Mr Law. I regard the insinuation made by Mr Fernon in Mr Smith's cross-examination that Mr Law ought not to have been excluded as a person of interest as absurd.

175 The plaintiff's case was run on the basis that anyone could have sent the doctored email. I do not accept this proposition. I am satisfied, on the basis of Mr Thompson's and Mr McGowan's evidence that the doctored email was created by one of the persons who received it in electronic form. Further, I regard the insinuation that Mr Giovas might have been responsible as fanciful. Not only did he not have electronic access to it, but he had ceased to be an employee of the ANZ more than two years earlier. I accept Mr McGowan's evidence on this matter as follows:

"No, my approach that someone who is no longer an employee couldn't have got that email or been privy to that discussion."

"I didn't consider [investigating Mr Giovas] that to be a reasonable avenue of inquiry. There was nothing that indicated George Giovas had anything to do with this email, and no evidence to suggest that he was working in conspiracy with any of those ten recipients."

176 Mr Fernon also suggested to Mr Smith in cross-examination that Ms Khalife had not been interviewed. In light of Ms Novotny's unchallenged evidence that it was unlikely that Ms Khalife was the author of the envelope, it is not necessary to consider Ms Khalife further or the suggestion that she might have had felt some antagonism towards either the ANZ or Mr Law. It is sufficient to say that I accept Mr Law's evidence that Ms Khalife resigned from the ANZ because she had found a full-time position elsewhere and that she had given notice prior to 20 June 2012. I also note that there was an occasion on which Ms Khalife left his office in a distressed state, but I accept Mr Law's evidence that this occurred some time after she had resigned and therefore was not causally related to her resignation.

Damages

177 Notwithstanding my findings on liability, I am obliged to set out my findings on damages.

178 Under the plaintiff's contract of employment he was entitled each year to remuneration of a combination of salary, superannuation and benefits (referred to as total employment cost, or TEC), which were to be reviewed annually; and participation in an incentive plan. By 15 August 2012 his TEC was $330,000 per annum. The incentive plan provided him with an opportunity to earn bonuses, which were paid at the ANZ's discretion, in shares or cash or both. When such shares vested in the plaintiff and he redeemed them by exercising his right to sell them, he became entitled to the benefit of those shares and any shares repurchased by re-investment of dividends on those shares.

179 Any shares that had not been vested in the plaintiff would be forfeited if the plaintiff's contract was terminated for serious misconduct. As a result of bonus payments made to the plaintiff, he was otherwise entitled to the following numbers of shares, being a total of 28,886, that had not vested on the termination date:

Parcel	Number of shares	Vesting date
(a)	1581	12 November 2012
(b)	891	13 November 2012
(c)	540	13 November 2012
(d)	770	13 November 2012
(e)	8,920	25 February 2013
(f)	2,014	14 November 2012
(g)	4,217	12 November 2013
(h)	2,014	14 November 2013
(i)	3,554	14 November 2014
(j)	4,385	13 November 2012

180 Transaction confirmations obtained from Computershare established that the plaintiff sold the 2,953 shares in (b), (c) and (d) above, together with 752 bonus shares, on 14 September 2012, notwithstanding their forfeiture and received net proceeds of $70,918.45.

181 The applicable principle was enunciated in TCN Channel 9 Pty Limited v Hayden Enterprises Pty Ltd (1989) 16 NSWLR 130. The assumption that the defaulting party would have so acted as to perform the contract in the way most advantageous to it requires that regard be had to the facts and relevant circumstances. Accordingly, damages are to be assessed by reference to the real possibilities rather than the assumption, if the assumption is inconsistent with the facts: see also The Commonwealth v Amman Aviation Pty Limited (1991) 174 CLR 64 at 149-150 per Gaudron J; Whitehouse Hotels Pty Limited v Lido Sovay Pty Limited (1975) 49 ALJR 93 at 98 per Gibbs J.

182 The ANZ contended that, had it not terminated the plaintiff's contract of employment for serious misconduct, it would have terminated the plaintiff's employment by giving four months' pay in lieu of notice pursuant to cl 14.3(a) since neither Mr Corbally nor Mr Law trusted him anymore, not only as a result of Ms Novotny's findings but also, and separately, because of what they adjudged to be lies he told in the course of the investigation.

183 The plaintiff submitted that, but for Ms Novotny's evidence, the ANZ would have kept him on because he was such a successful banker. He claimed damages on the basis that he would have worked for the ANZ and received bonuses until 15 August 2022. Nonetheless, the plaintiff accepted that the ANZ could have terminated his employment at any time by giving four months' notice.

184 In light of the evidence of Mr Corbally and Mr Law I am satisfied that, after the meeting of 15 August 2012, there was no real prospect of the plaintiff remaining as an employee of the ANZ. I accept Mr Corbally's evidence set out above that once he felt that he could no long trust the plaintiff or have confidence in his word, the employment relationship was, effectively, unworkable, whatever the plaintiff's skills and capacities in other areas. I also accept Mr Corbally's evidence in the following exchange in cross-examination:

Q. . . . if it was that on an examination of the original, Ms Novotny adhered to her view, and another handwriting expert was of the view that the conclusion was inconclusive as to whether the author of the questioned document was the same as the author of the specimen handwriting, you wouldn't have terminated, would you?

A. No, I disagree, given the handwriting report that I had received from - from our own forensic examiner, given the investigation work that was undertaken and the report, and given the discussions that I had with Mr Bartlett, I'd lost trust and confidence in Mr Bartlett and he would have been terminated.

Q. That would have been a decision based upon the coincidence of which particular handwriting expert you preferred, wouldn't it?

A. We - we had an independent - as I understood it, it was an independent handwriting expert who was - I was led to believe was one of the best in the country, and she had provided us with an opinion, and the opinion said that it was highly probable that it was Paul.

185 Accordingly, I am satisfied that the assumption that the defendant would act in the way most advantageous to it (see Maredelanto Compania Naviera SA v Bergbau-Handel GmbH; The Mihalis Angelos [1971] 1 QB 164) is consistent with the facts and circumstances in the present case. The ANZ would have, in this event, terminated the plaintiff's employment by paying his remuneration for four months in lieu of notice.

186 The contract provided that whether a bonus was awarded to any employee was a matter entirely within the discretion of the ANZ. The clause would not be construed to permit the ANZ to withhold a bonus capriciously, arbitrarily or unreasonably: Silverbrook Research Pty Limited v Lindley [2010] NSWCA 357 at [5] per Allsop P, Beazley JA agreeing. In the circumstances of this hypothetical scenario (termination with pay in lieu of notice rather than termination for serious misconduct), I find that the ANZ would not have awarded any bonus at all to the plaintiff for the 2012 financial year. In the circumstances, such a decision would not, in my view, have been arbitrary, capricious or unreasonable.

187 I accept the ANZ's calculations of the amounts to which the plaintiff would have been entitled had his employment been terminated with four months' notice. The plaintiff would have been paid, in lieu of notice, a gross amount of $110,000 (comprising salary of $100,917.43 and superannuation contribution of $9,082.57). This payment would have been characterised as an employment termination payment subject to withholding of tax in the amount of $35,505. The plaintiff would have received a net payment of $69,129.43 with a contribution to his superannuation fund of $5,365.57, totalling $74,495. I do not accept the plaintiff's contention that damages should be assessed on a gross (pre-tax) basis but, if I am wrong about this, the difference can readily be calculated.

188 The conditions of grant in the ANZ's equity schemes were such that all unvested shares are forfeited at the time the notice of termination is received. For the reasons given above, the plaintiff would not have been awarded any bonus payments. Not only did the ANZ have a discretion, but, on the findings I have made above the most likely alternative scenario (but for summary dismissal) would have been that the plaintiff would have been paid out on 15 August 2012 in lieu of notice.

189 Accordingly, I assess the plaintiff's damages at $74,495. He would be entitled to pre-judgment interest on that sum from 15 August 2012 if he were (contrary to my findings) entitled to a judgment in his favour.

190 By reason of my findings on damages it is not necessary to address the evidence about the vicissitudes to which bankers are subject as a result of market conditions, restructures and so on. It is sufficient to say that I regard the prospect of the plaintiff staying at ANZ for any extended period, even apart from the conduct that led to his termination, as remote. Mr Rees and Mr Caldwell were made redundant in the restructure of July 2012. By the time of the hearing of these proceedings, all of the directors from Mr Law's team had left the ANZ either because of termination (in the case of the plaintiff) or retrenchment, redundancy or resignation. After the plaintiff's employment was terminated, he was not replaced. The business he had run was subsequently conducted by Mr Cotterell, Mr Amati and Mr Dyki, each of whom was a Group 3 (below the level at which the plaintiff had been employed). Nor is it necessary to address such matters as mitigation, or whether the plaintiff's income from Magma Capital after his contract with the ANZ was terminated was reflective of his earning capacity.

Orders

191 I make the following orders:

(1) Judgment for the defendant.

(2) Unless either party makes an application in writing to my Associate within seven days, order the plaintiff to pay the defendant's costs of the proceedings.

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Decision last updated: 24 November 2014