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Hardie (Practising as J D Hardie & Co) v Round AC 9/08 [2008] NZEmpC 21 (16 April 2008)

Last Updated: 26 April 2008

IN THE EMPLOYMENT COURT

IN THE MATTER OF an appeal against a decision of the Employment Tribunal

BETWEEN JOHN DAVID HARDIE (PRACTISING AS J D HARDIE & CO)
Plaintiff

AND MARTIN CHARLES ROUND
Defendant

Hearing: 3 April 2008

(Heard at Auckland)

Appearances: Appellant in person
Carl Blake, Counsel for Defendant

Judgment: 16 April 2008     

Background

[1] After numerous interlocutory judgments and appeals from them over the past 7 years, this is the substantive judgment on John Hardie’s appeal against the decision of the Employment Tribunal given on 22 January 2001.
[2] Martin Round was dismissed summarily by Mr Hardie on 13 August 1999 when the Employment Contracts Act 1991 (“the Act”) governed their employment relationship and the dismissal. The Employment Tribunal found the dismissal to have been unjustified. It directed Mr Hardie to pay to Dr Round all wages lost at the rate of $15 per hour for a 37.5 hour week from the date of dismissal until 9 January 2001 being the first day of the adjudication hearing in the Tribunal. The Adjudicator also awarded distress compensation of $10,000 under s40(1)(c)(i) of the Act and, subsequently, costs of $11,362 in two separate decisions.
[3] At the time of his dismissal Dr Round was a 38 year old but newly qualified and so a junior lawyer with post graduate qualifications in Arts and Law from Auckland and Columbia (New York) Universities. He had held an adjunct professorial post and had worked in New York for an intellectual property law firm as a legal executive before returning to this country in 1997 when he was admitted to the Bar.
[4] Dr Round obtained employment with Mr Hardie, who practices as Patent Design and Tradework Attorneys and Intellectual Property Law Specialists, in the same year. Rather than an annual salary, Dr Round was paid $15 per hour for the hours that he worked and recorded. His notional working week was of 37.5 hours although sometimes he worked more or less. At that notional rate, his annual remuneration was less than $30,000. There was no written employment contract evidencing these contractual arrangements.
[5] Dr Round’s work was carried out in several locations. In addition to Mr Hardie’s two offices (one central city and one suburban at the latter of which he principally worked), Dr Round’s work took him, from time to time, to the High Court library, the Companies and Patents’ Offices for research purposes and, occasionally, to clients’ premises. So it followed that his absence from Mr Hardie’s principal office (suburban) in Te Atatu did not necessarily mean that he was not working.
[6] Until the events about to be recounted, Dr Round’s employment was satisfactory to Mr Hardie who was able to generate substantial fees from the work undertaken by the defendant, especially in comparison to his hourly rate of remuneration.
[7] In July 1999 information reached Mr Hardie that Dr Round was falsifying his timesheets that were the basis of the remuneration paid to him. This advice was double hearsay in the sense that it came to Mr Hardie from his son who was not involved in the practice and was said to have come to him from an unnamed staff member in the practice. Mr Hardie deputed to Josephine Burgess, a senior staff member, the task of monitoring Dr Round’s hours of work and comparing these to his claims. Mrs Burgess did so by noting his arrival and departure times at and from the Te Atatu office together with other information she had as to his whereabouts. Mrs Burgess’s first written report to Mr Hardie appeared to confirm discrepancies between hours worked and claimed. Mrs Burgess added to and modified this initial report to Mr Hardie on several occasions. Her figures provided a deficit of working time of a little over two hours per day when compared to the hours recorded by Dr Round and for which he was paid.
[8] After a number of days of Mrs Burgess’s observations and reports to him, Mr Hardie also observed Dr Round’s arrivals and departures from the office and kept his own record of these that he later compared to Mrs Burgess’s. In addition, Mr Hardie obtained some information from the alarm monitoring company that maintained records of when alarms were activated and deactivated at the premises so as to take account of Dr Round’s movements outside the times that Mr Hardie could observe these.
[9] Nothing was said to Dr Round about these observations, or indeed, about his timekeeping and claims.
[10] At the same time as asking Mrs Burgess to report to him, Mr Hardie altered the nature of Dr Round’s work load so that he was asked to continue existing work but not to take on any new tasks, especially more complex ones. The Authority found that this was to minimise any unfinished work if Dr Round was to eventually be dismissed for fraudulent claims.
[11] At 5.30 pm on 13 August 1999, after other staff had left for the day, Mrs Burgess told Dr Round that he was to see Mr Hardie in the firm’s lunch room. Present at the meeting were Mr Hardie, Mrs Burgess and Dr Round. Dr Round was not told in advance of the meeting of what was to be dealt with and indeed had no inkling that his time keeping had been investigated because Mr Round and Mrs Burgess had ensured that her observations and recordings were covert.
[12] After telling Dr Round that there were discrepancies between the times that he had worked and those for which he claimed money, Mr Hardie announced to Dr Round that the latter was to be dismissed summarily unless he could produce “some earth-shattering revelation of why his recorded hours did not match his observed hours”. Although Mr Hardie had available at the meeting with Dr Round, some of the records he and Mrs Burgess had created, these were not provided to Dr Round. Indeed these records were subsequently reconstituted and it was only immediately before the hearing in the Employment Tribunal that Mr Hardie presented a new and comprehensive matrix of dates and times that he alleged established the discrepancies for which Dr Round was dismissed. These show that the Hardie/Burgess observations took place on 10 dates between 26 July and 12 August 1999.
[13] After a discussion in which Dr Round was unsuccessful in attempting to change Mr Hardie’s mind, the defendant was formally dismissed and escorted from the building.
[14] The letter of dismissal, prepared before the meeting with Dr Round as was the make-up of his final pay, recorded the reasons for it as follows:

Dear Martin,

It gives me no pleasure to have to terminate your employment on the grounds of your dishonest claiming of hours worked which have not been worked.

Just how you could stoop to such behaviour in the light of the support that you have been given during your period of illness is beyond me. You have received sick pay far in excess of your contractual right.

Your employment ceases forthwith. You are to surrender your Amex card, your key to the premises, and you are to remove your personal belongings from the premises under supervision and leave immediately.

Your final pay slip is enclosed. A direct credit for the net amount should go through tonight.

In the circumstances we will not be supplying a reference although a record of the period of your employment can be supplied on your request.

...

[15] Dr Round was affected adversely by these events. He was dismissed from his position as a barrister and solicitor with a patent attorney on grounds of dishonesty. There are not many patent attorneys practising in New Zealand and it would have been, and indeed was, difficult in these circumstances to have obtained alternative employment in the field. The ethical standards of conduct of patent attorneys are effectively the same as for barristers and solicitors as indeed Dr Round was one. Although not attributable to his employer, Dr Round had previously suffered illness for some time that had strained his financial resources so that his position, known to Mr Hardie, was exacerbated by the summary dismissal. Dr Round felt compelled to register for an unemployment benefit and dreaded being seen to do so. Work and Income New Zealand required a full explanation of his dismissal that he was obliged to give in an open plan office environment as a mature man and highly qualified lawyer addressed as “Doctor”.
[16] Dr Round returned to his family home in Christchurch to minimise further financial loss to himself but still had to borrow money from his parents from whom he had lived away for almost 20 years.
[17] Mr Hardie threatened, in correspondence with Dr Round’s solicitors, to inform both the Police and the Law Society of what he, Mr Hardie, alleged was Dr Round’s fraudulent conduct. Dr Round was very concerned that his ability to practise law might be affected, even by what he was confident would transpire to be an unmeritorious complaint.
[18] Dr Round found alternate job hunting to be both unpleasant and humiliating. He felt obliged to be candid about the circumstances of his dismissal with the recruitment firms with which he had registered his name and that he had no reference from his previous job from which he had been dismissed. Dr Round described in evidence the initial enthusiasm with which the recruitment agencies received his curriculum vitae but the sudden and marked changed in that attitude when the circumstances of his leaving his previous employment were explained. Dr Round was told by some recruitment firms that they were not interested in trying to find him a job and even after he reached interview stage with some others, it became clear to him that there existed concern in the minds of potential employers that there may have been some truth in Mr Hardie’s accusations that Dr Round was a liar and a thief. In the end, it took Dr Round 14 months to find another job and only then when he moved to Malaysia to work.

The relevant legal principles

[19] The test of justification is set out in a judgment issued after the case was decided in the Tribunal. Both Mr Hardie and Mr Blake, counsel for Dr Round, accepted, however, that the test was that set out by the Court of Appeal in W H Newspapers Ltd v Oram [2000] 2 ERNZ 448, [2001] 3 NZLR 29. The differences between the parties relate to Mr Hardie’s compliance with the tests.
[20] Relevant statements of the principle in the judgment of the Court of Appeal include the following:

... in a personal grievance, once the employee has established a prima facie case of unjustifiable dismissal, the onus is on the employer to justify the dismissal. The Court has to be satisfied that the decision to dismiss was one which a reasonable and fair employer could have taken. ... (para [31])

...

The burden on the employer is not that of proving to the Court the employee's serious misconduct, but of showing that a full and fair investigation disclosed conduct capable of being regarded as serious misconduct. This distinction is highlighted in cases involving alleged dishonesty by employees. An employer can justify dismissal without having to prove the dishonesty by showing that, after a full and fair investigation, it was at the time of the dismissal justified in believing that serious misconduct had occurred. (para [32])

...

If, in a particular case of summary dismissal, the employer shows that the conduct was such that a fair and reasonable employer could see it as deeply impairing of the basic confidence and trust essential to the employment relationship, it would hardly be necessary to consider, as a separate step, whether in all the circumstances the employee ought to have been dismissed. This assumes, of course, that the fair and reasonable employer did take into account all the relevant circumstances of the conduct and the particular employment relationship in determining that the necessary confidence and trust had been deeply impaired. (para [35])

[21] The several references to a full and fair investigation bring into consideration what the Courts have said is required in general of such an investigation. Mr Hardie accepted the tests set out in the judgment of the Labour Court in NZ (with exceptions) Food Processing etc IUOW v Unilever NZ Ltd [1990] 1 NZILR 35, as including:

• notice to the employee of a specific allegation of misconduct to which the worker must answer and of the likely consequences if the allegation is established;
• an opportunity, which must be a real as opposed to a nominal one, for the employee to attempt to refute the allegation or to explain or mitigate his or her conduct; and
• an unbiased consideration of the worker's explanation in the sense that that consideration must be free from predetermination and uninfluenced by irrelevant considerations.

[22] Mr Hardie contended that the evidence showed that each of these tests had been met in the relevant circumstances of the case so that he had conducted a full and fair enquiry into his allegation of misconduct against Dr Round before dismissing him.
[23] Mr Hardie did not contest Mr Blake’s proposition, well established in law, that the more serious the allegation of misconduct against the employee, the greater will be the expectation of its proof: Honda NZ Ltd v NZ (With Exceptions) Shipwrights etc Union [1990] 3 NZILR 23. There can be no doubt that an allegation of financial dishonesty against a solicitor employee, as this was, is of a very serious nature. Indeed, Mr Hardie’s submissions for other purposes endorsed and relied upon that self-evident proposition.

Erroneous conclusions of fact?

[24] Having read the transcript of the hearing in the Tribunal and, in light of the documentary exhibits, I have concluded that where there were conflicts in the evidence between the parties, the Tribunal was entitled to prefer the account given by Dr Round as it did on a number of occasions. This was not a matter of determining disputed credibility by reference to demeanour or other unscientific and now discredited, or at least doubted, principles as Mr Hardie submitted to the Court. The transcript makes it clear, for example, that on a number of crucial issues Mr Hardie was less confident in his recollection and account of them than was Dr Round. While it is to his credit that Mr Hardie conceded that he had doubts, the Tribunal was entitled to weigh those in the balance. Mr Hardie bore the onus of establishing in the Tribunal that his dismissal of Dr Round was justifiable. Dr Round had established a prima facie case of dismissal that was without justification and the onus then moved to the employer to justify it. The Tribunal was entitled to take the view that Mr Hardie had failed to discharge that onus in particular respects of the relevant evidence.
[25] So it follows that the Tribunal was entitled to accept Dr Round’s evidence and reject Mr Hardie’s to the contrary, when determining what happened at the crucial dismissal meeting on 13 August. Mr Hardie’s case on appeal did not seek to advance, by reference to inconsistent evidence of documents or the like, a different scenario. Rather, it was the Tribunal’s conclusions and application of the law to those facts on which Mr Hardie focussed in attempting to persuade me that the decision at first instance was wrong. So the appeal must be decided against the following particular factual background determined by the Tribunal.

Events relevant to justification for dismissal

[26] Mr Hardie said there was a plain conflict of evidence between him and Mrs Burgess on the one hand, and Dr Round on the other, as to whether, at the meeting on 13 August, Dr Round told his employer that he might have been undertaking work out of the Te Atatu office on one or more days on which the discrepancies between observed and recorded times were noted. Mr Hardie submitted that the Tribunal wrongly preferred Dr Round’s evidence to that of the employer’s witnesses. Mr Hardie submitted that the evidence of Mrs Burgess, his office manager, ought to have been preferred, more especially as she was, by the time of the Tribunal hearing, no longer employed by Mr Hardie. Added to that, Mr Hardie submitted, her manager had shown some bias in favour of Dr Round who had everything to gain by giving false evidence to the Tribunal.
[27] Mr Hardie criticised the Tribunal for having determined its preference for disputed evidence upon the demeanour of witnesses. Mr Hardie pointed out that when given an opportunity to explain on 13 August, Dr Round raised topics of no real importance such as inquiring who had alerted the employer to the possibility of false time keeping, but nothing that would explain adequately the deficiencies noted. More particularly, Mr Hardie submitted that there was no evidence of Dr Round raising at the meeting what he later claimed would have assisted him in giving an account of his times, that is by reference to the actual client files on which he was working. In this regard, also, Mr Hardie submitted that Dr Round’s notes of the events of the late afternoon of 13 August which he claimed to have made later that night and on the following day, were not an accurate record of what had happened and the Tribunal should not have relied upon their contents or upon Dr Round’s evidence based upon them.
[28] As to the interview with Dr Round on 13 August, Mr Hardie emphasised that he told Dr Round of the nature of the meeting as soon as it began. He emphasised that he did not mislead Dr Round and that the dismissal interview was “transparent”. Mr Hardie emphasised that he told Dr Round of “at least one particular observation which was going to lead to his dismissal in the absence of an explanation”. He said that because Dr Round gave no reason to cause him or Mrs Burgess to doubt that the employer had every justification in summarily dismissing him, Mr Hardie acted reasonably in doing just that. He emphasised that Dr Round had the opportunity to explain the shortfall pointed out to him but did not. Mr Hardie said Dr Round knew why he was being dismissed and so his rights were adequately taken care of by the employer who acted at all times “absolutely reasonably” towards Dr Round. Mr Hardie emphasised that because the office manager Mrs Burgess was part of the decision making process the Tribunal ought to have inferred that she “would have grasped any straws the applicant [Dr Round] might have cast in his favour, had any been advanced by him at the dismissal interview” and ensured that these were fully discussed. Mr Hardie submitted there was none.
[29] Without any advance notification of what was to transpire at that meeting on Friday 13 August, Dr Round was told by Mr Hardie that he had lied about his time records. Dr Round denied this and asked for the grounds of the allegation. Mr Hardie responded that someone had complained although he did not identify the person. When pressed by Dr Round, Mr Hardie continued to refuse to identify the person although Mrs Burgess denied that it was she. Dr Round continued to seek the basis for Mr Hardie’s allegation, saying that he was almost invariably the last person to leave the office in the evenings and that others employed there would not therefore have known what time he finished work, let alone the number of hours he entered on his timesheet.
[30] Dr Round also pointed out that he often attended to firm business before arriving at the office in the mornings or on his way home. He made the point that it was inconsistent with short-changing his employer that he had been asking for more work and it was then that Mr Hardie told him that he had reduced or altered Dr Round’s workload so that he would not be working on partly completed files when dismissed.
[31] There was a discussion about the practices of other staff members and Mr Hardie’s view that Dr Round should have followed their examples. He responded that he was unaware of what other staff did and had not been told to do so in the first place or during his 2 years of employment. Discussion did not proceed much beyond these disagreements. The meeting lasted between 10 and about 30 minutes and at its conclusion Mr Hardie handed Dr Round the pre-prepared dismissal letter and his final payslip. Dr Round was then required to surrender his office key and credit card. Mr Hardie stood over Dr Round while he cleared out his personal belongings and escorted him out of the building.
[32] Although Mr Hardie had such rough handwritten time and attendance records as then existed in an adjacent room, he did not offer these to Dr Round or refer to their existence. Mr Hardie was not receptive to Dr Round’s questions and exhibited a closed mind to any possibility that he may have been wrong in his assessment of Dr Round’s time keeping.

Full and fair inquiry?

[33] I agree with the Tribunal that this did not take place. Dr Round was first advised of the allegations against him at the start of the meeting at which he was summarily dismissed. These allegations were not particularised and the written logs and other records of them were not shown or given to him. He was expected to account, to an exceedingly high standard (the earth shattering revelation as Mr Hardie categorised it), for his whereabouts and to satisfy his employer that he had worked for the hours claimed on days over the previous period of almost 3 weeks. He was both confronted with these allegations and expected to discount them, to a very high degree of certainty immediately after the end of a working week. Dr Round faced the allegations by his employer and a senior manager, both of whom had taken time and trouble to build a case against him. Mr Hardie considered that he could not imagine how Dr Round could explain or answer these charges.
[34] There was no offer of an opportunity to obtain advice and representation. Mr Hardie submits that Dr Round, as a solicitor, albeit a junior and inexperienced lawyer and one whose field of expertise did not include employment law, ought to have been well able to deal with these issues without assistance or support. This is one of those cases, Mr Hardie says, where there can be no reasonable requirement for assistance or representation nor that this should be suggested and allowed for in the employer’s process.
[35] I do not agree. Although Mr Hardie was entitled to conduct his own investigation and make decisions as he saw fit, he himself might well have benefited from taking professional advice from a colleague with some knowledge of and experience in employment law. But, for the purposes of this judgment, it was unfair of Mr Hardie to not have permitted Dr Round to do so. It is not sufficient to say that it did not occur to Dr Round to ask for a postponement of the meeting to take legal advice and be represented. In all the circumstances of the case, that opportunity should have been allowed for by Mr Hardie. It is not surprising that, in view of the nature of the allegations, Mr Hardie’s already established satisfaction that they were correct, and the dynamics of the employment relationship, Dr Round did not then have the presence of mind to think strategically and to seek advice and representation.
[36] From the evidence Mr Hardie is a forceful, uncompromising and demanding practitioner and employer with whom Dr Round had recently disagreed sharply over the conduct of some litigation. Dr Round was not in the best of health at that time and known to be so by Mr Hardie. All of these circumstances combine to cause me to conclude that the failure to consider or offer him the opportunity to take advice and be represented, created a significant unfairness in the process that led to dismissal.
[37] Although Mr Hardie is correct that he told Dr Round of the allegations of misconduct against him and certainly of the consequences, it was, in my view, unfair to have done so as late as at the start of the relatively short meeting after work on a Friday afternoon and at the conclusion of which summary dismissal was effected. The requirement to inform an employee of serious allegations of misconduct includes necessarily a proper opportunity to consider and reflect on these allegations and a proper opportunity, if they are contested as here, to establish that disagreement by reference to independent witnesses and facts. Mr Hardie told Dr Round of the serious allegations against him less than an hour before he was summarily dismissed. In the same proverbial breath, Mr Hardie told him that he would be dismissed unless he had an earth shattering explanation for the allegations. The employer did not fulfil at all the minimum requirements of the first two Unilever tests.
[38] As to whether Mr Hardie gave Dr Round’s explanation an unbiased consideration free from predetermination and uninfluenced considerations, the following factors are pertinent. Mr Hardie had prepared Dr Round’s letter of dismissal before the meeting on Friday 13 August. It was handed over to Dr Round unaltered. From about the time that Mr Hardie first became aware of suggestions of inaccurate time keeping and claims by Dr Round, the employer changed the nature of Dr Round’s work to minimise the adverse effect on the practice and clients of a dismissal of him. Also before the meeting Mr Hardie made up Dr Round’s final pay so that these details could be sent electronically to the firm’s bank that evening to ensure a final pay-out to him.
[39] Although Mr Hardie had explanations for each of these apparent indicia of predetermination, I do not accept that they address adequately that important element of natural justice. Although, as Mr Hardie contended, none of these actions is unlawful per se and each may be entirely justifiable in other circumstances, taken together they are indicative of a predetermination of the outcome of the employer’s inquiry, certainly before Dr Round had any opportunity for input into this.
[40] Despite having gone through a form of investigative meeting on 13 August 1999, these prior indicia, combined with the almost impossibly high standard of persuasion that Mr Hardie set Dr Round to move the employer from his conclusion of serious misconduct and other relevant events at the meeting, establish a strong case of unfair predetermination of the investigation.
[41] So it follows, applying the tests in Oram, a fair and reasonable employer could not have concluded that Dr Round was fraudulently obtaining wages from his employer. It is more probable than not in my conclusion that Mr Hardie reached that decision from which he could not in reality be moved, at least immediately before the start of that meeting at which he first told Dr Round of the allegations and probably some days before that.
[42] Mr Hardie’s strongest argument in support of justification for his dismissal of Dr Round related to what he said was the inappropriateness of telling an employee, believed to be guilty of fraud, that observations and inquiries were being made. That, Mr Hardie submitted correctly, would be guaranteed to bring to an end any misconduct by an employee so informed. To the extent that the Tribunal may have been critical of Mr Hardie not taking up Dr Round’s time keeping with him rather than continuing covert observations, the appellant said that the Tribunal was wrong to have concluded that his conduct was unjustified.
[43] I do not understand the Tribunal to have determined that any failure or refusal by Mr Hardie to have informed Dr Round that he was under observation for accuracy of time keeping caused the dismissal to have been unjustified. Rather, I read the Tribunal’s decision as suggesting that a preferable way of dealing with any inaccuracies would have been to have discussed these with Dr Round at an early stage in an effort to have cleared the air and enabled a productive employment relationship to have continued. But Mr Hardie may be right that what he believed were the initial indications of dishonesty were so potentially destructive of the relationship of trust and confidence that he was entitled to test the truth of them and make a decision based on that.
[44] However, where, as here, an employer decides to undertake covert surveillance, the duration of that surveillance before an employee such as Dr Round is told about it and of the results must be commensurate with an ability for the employee to recall the relevant events and to challenge the employer’s account of them. Long delay between initial observation and disclosure may seriously compromise an employee’s ability to recall what may or may not have happened on otherwise unremarkable days in the past and also to enable the employee to have recourse to independent evidence that may confirm what happened.
[45] So as a matter of fairness, Mr Hardie was obliged to make known his concerns and the grounds for them within a reasonable time of the occurrence. Also, and more importantly in this case where there had been a significant lapse of time (up to 3 weeks), this would have allowed Dr Round a fair and proper opportunity to consider and recall much earlier events and to attempt to counter the allegations with which he disagreed by recourse to independent evidence which may have supported his denial. That did not occur and could not have occurred under the process for investigation and dismissal decided upon unilaterally by Mr Hardie.
[46] I am satisfied that the Tribunal did not substitute its decision for that of the employer as to whether Dr Round fraudulently claimed wages for time not worked and, if so, as to the consequence for that breach of his employment contract. Rather, the Tribunal concluded that a fair and reasonable employer could not have so concluded following the inquiry conducted by Mr Hardie. The Tribunal found, correctly, that there was not a full and fair investigation of the allegations of serious misconduct that disclosed conduct capable of being regarded as serious misconduct.
[47] Mr Hardie took it upon himself to consider whether Dr Round may have had any reasonable explanation for what were regarded as the deficiencies. He concluded that Dr Round could not have a reasonable explanation given what Mr Hardie considered were the daily excessive claims and his assumption that the vast majority, if not all, of Dr Round’s work was performed at the firm’s Te Atatu office where the time keeping observations were made and recorded. That was, however, self serving information in the sense that Mr Hardie went through the artificial exercise of trying to think what explanations Dr Round may have been able to have come up with but concluded that there was none. A reasonable explanation for an allegation of serious misconduct by an employee is just that, the employee’s own explanation assessed for reasonableness. It is not the employer’s own guess, however well intentioned and thoroughly considered.
[48] It was not simply, as Mr Hardie has submitted, a question of his and Mrs Burgess’s consistency of their observations of the start and finish times of Dr Round that so strengthened the employer’s case against him that it was virtually unanswerable before being made to Dr Round. As Mr Hardie expressed it, such was the conviction of his belief of fraudulent claims that Dr Round would have had to have produced an earth shattering revelation to have caused Mr Hardie to have doubted the truth of the allegations.
[49] Mr Hardie took issue with the Tribunal’s conclusion that the employer had deliberately reduced Dr Round’s workload so that as and when he was dismissed, minimal half finished work would be left. Mr Hardie submitted that the evidence showed that Dr Round’s workload had not been reduced but rather “tailed off”. He submitted that the evidence showed that he had confined Dr Round’s work to matters already under way with a view to seeing them largely completed and in some cases finalised but there was no evidence that this was intended to ensure that there would be no half finished work when Dr Round came to be dismissed.
[50] The distinction between Mr Hardie’s position and the Tribunal’s finding is subtle. The significance of the finding is not, however, in the accuracy of the Tribunal’s recounting of Mr Hardie’s evidence but rather that the employer’s actions were consistent with a predetermination of the allegations and the outcome of dismissal as indeed occurred.
[51] Next, Mr Hardie criticised the Tribunal’s finding that he failed to seek answers from Dr Round about the apparent time keeping discrepancies prior to the meeting on 13 August at which the dismissal occurred. Also criticised is the Tribunal’s finding in this regard that Mr Hardie chose not to tell Dr Round that he was under investigation or even to tell him that he was concerned about the hours he kept.
[52] This, Mr Hardie submitted, was a clear example of the Tribunal substituting its judgment for that of the employer. Further, he submitted that the Tribunal did not appear to have appreciated that his concern was not with the hours which Dr Round kept (although these concerned the employer) but the hours that Dr Round recorded as having been worked and which formed the basis for his pay.
[53] A further example of what Mr Hardie contended was the Tribunal’s substitution of its decision for the employer’s was its conclusions about the preparation of the dismissal letter before meeting with Dr Round to reveal the allegations against him. Mr Hardie submitted there was nothing wrong or unreasonable in his doing so and was not evidence of predetermination of the outcome of the employer’s inquiries.
[54] I have assessed each of these complaints by Mr Hardie of error by the Tribunal against the transcript of the evidence and the relevant documents produced to it. Not only am I satisfied that the Tribunal was fully entitled to reach the conclusions that it did, but to the extent that I can do so also on appeal, I agree with its conclusions.
[55] I conclude, as did the Tribunal, that Mr Hardie could not have come reasonably to the conclusion that Dr Round falsified his claims of time worked for unearned remuneration. In this regard it should be said clearly that Dr Round should not bear the stigma of this unproven and therefore unwarranted allegation. It follows that the Tribunal concluded correctly that he was dismissed unjustifiably.
[56] In these circumstances there is no real challenge to the remedies for the consequences of the summary dismissal that were provided. In light of Mr Hardie’s threats of Police and Law Society complaints, the plaintiff is fortunate that the remedies decided by the Tribunal for unjustified dismissal were so modest.
[57] Mr Hardie’s appeal also relates to the Tribunal’s two costs awards. So far as the award for the substantive hearing is concerned, Mr Hardie accepted that costs should have followed the event and that if he is unsuccessful as he is, then the Tribunal’s award of $9,000 should not be disturbed. That is a sensible and pragmatic approach and I agree that the Tribunal’s award of costs should stand. So far as the smaller award was concerned, this was made in respect of difficulties about discovery in which the Tribunal concluded that Mr Hardie did not meet his obligations to make disclosure of relevant documents in a timely fashion. Although Mr Hardie acknowledged that he may have been at fault in part, he said this was not to the extent the Tribunal found. I have not been persuaded, however, that the Tribunal’s decision in respect of this costs award was wrong. It was in a good position to have made the assessment it did and the amount of the orders was relatively modest in all the circumstances. I am not prepared to interfere with the Tribunal’s costs awards.

Costs on the appeal

[58] Dr Round is entitled to these. His counsel asked that they be reserved. Mr Hardie acknowledged that costs should follow the event in the appeal as in the Tribunal.
[59] Recognising the reality that costs are unlikely to be agreed between the parties, Dr Round may have the period of 28 days from the date of this judgment to file and serve a memorandum in support of his application for costs with Mr Hardie having an identical period of 28 days within which to respond by memorandum. Costs will then be dealt with on the papers.

Disbursement of the Tribunal’s awards and interest

[60] As a condition of the making of an earlier interlocutory order, the monetary awards of the Tribunal have been held on interest bearing deposit pending the outcome of this appeal. They, together with the accrued interest on them, may be released to Dr Round within 28 days of the date of this judgment. Mr Hardie raised questions of Dr Round’s liability to state welfare agencies but I take the view, following well established case law, that any money Dr Round may now be required to repay to state welfare agencies is a matter between him and them. The only way in which Mr Hardie may be involved justifiably in the disbursement to Dr Round of his remedies is for the deduction of income tax from those monies representing lost remuneration and for which Mr Hardie will have to account in turn to the Commissioner of Inland Revenue. For the avoidance of doubt, all monies including net remuneration compensation after deduction of taxation should be paid out to Dr Round within 28 days.

GL Colgan

Chief Judge

Judgment signed at 4.15 pm on Wednesday 16 April 2008