Director-General of Education v Suttling

162 CLR 427
1987 - 0212A - HCA; 69 ALR 193

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(Judgment by: Brennan J)

Between: Director-General of Education
And: Suttling

Court:

Judges: Mason ACJ
Wilson J

Brennan JDeane J
Dawson J

Subject References:
Public Service

Hearing date: 26 September 1986
Judgment date: 12 February 1987

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Judgment by:
Brennan J

Mr Suttling, the respondent, was and is a member of the Education Teaching Service ("the Service") established under the Education Commission Act 1980 (NSW) ("the Act").  He has been employed continuously as a teacher since 1965.  In November 1981 , he was the Deputy Principal at the Roselea Primary School at Carlingford, a Sydney suburb.  His name was on a Promotions List kept under the Education Teaching Service Regulation 1982 which made him eligible for further promotion as a Principal or Deputy Principal of a primary school.  He saw an advertisement in the Education Gazette of 6 November 1981 which invited applications for appointment to the position of a Senior Education Officer Class 2, Staff Development, at a salary higher than the salary he was then receiving. The advertisement gave the number of the position, stated its location to be at the Professional Services Centre at Strathfield, and contained the following note:   

"GENERAL: Appointment will be by secondment until the commencement of the 1984 school year with the possibility of an extension.  Administration hours and conditions apply."

 

Mr Suttling applied for and was appointed to the position.  His letter of appointment from the Director- General of Education, dated 26 January 1982, stated the classification to be "Senior Education Officer, Class 2", repeated some of the particulars contained in the advertisement, and set out the period of the appointment:   " Commencing from: 2nd February, 1982 Effective to: Beginning of 1984 school year." Mr Suttling was employed as a Senior Education Officer Class 2 for a year only, working in the Consultancy Service. During that year, the organization of the Consultancy Service was reviewed and the employees were told that it was to be reduced by 72 positions.  The Strathfield Centre was to be closed in consequence of the amalgamation of the region which it served with an adjoining region.  The Professional Services Centre for the amalgamated region was to be located at Arncliffe.  Mr Suttling would not apply for appointment to a similar position at Arncliffe and no position of equivalent status could be found for him.  In the light of the advice that his position was to be abolished, Mr Suttling accepted, of necessity, an appointment as a Principal Grade 3 at the Milson's Point Primary School from 1 February 1983.  That position carried a lower salary than the position of Senior Education Officer Class 2.  Presumably the position he had occupied at Strathfield was then abolished although that does not clearly appear.  

Mr Suttling sued the first appellant, the Director-General of Education, in the Supreme Court of New South Wales for a declaration that "the defendant duly and validly appointed him to the position of Senior Education Officer Class 2 for a period of two years from 26.1.1982 until 31.1.1984" and for an order that the defendant "accord to the plaintiff the status salary condition and emoluments properly appertaining to the said position for the said period of two years together with interest on the said salary".  

No formal pleadings were delivered but, when the hearing commenced before Rogers J., counsel for Mr Suttling said that Mr Suttling's case was in contract and counsel for the Director-General said that the first ground of defence was that the Crown had the right to terminate Mr Suttling's employment at will and that that right included the lesser right "to put the officer back to a former status".  The issue whether the Crown had a right to terminate Mr Suttling's employment at will was seen as the critical issue both at first instance, where Mr Suttling failed, and before the Court of Appeal, where he succeeded.  But, in my view, the result of the proceedings does not turn on the resolution of that issue.  Mr Suttling has not been dismissed.  He remains, as he has been at all material times, a member of the Service.  The critical issues are whether Mr Suttling's appointment conferred an enforceable right to the "salary condition and emoluments" of the position of Senior Education Officer Class 2 at the Professional Services Centre at Strathfield for a period of two years and, if so, whether the premature termination of the appointment was valid.  

Members of the Service are appointed pursuant to the Act and their rights must be ascertained by reference to its provisions.  The relationship between a civil servant of the Crown and the Crown has often been described as contractual, though the civil servant has been appointed pursuant to statute: see, for example, Gould v. Stuart (1896) AC 575, at p 577; Carey v. The Commonwealth (1921) 30 CLR 132 , at p 137; Lucy v. The Commonwealth (1923) 33 CLR 229 , at pp 238,249,253.  However, the contractual nature of the relationship has not been universally accepted: see, for example, Monckton v. The Commonwealth (1920) 27 CLR 149 , at pp 155,156; Lucy v. The Commonwealth, at p 244; Geddes v. Magrath; Morgan v. Geddes (1933) 50 CLR 520 , at pp 533- 534; The Commonwealth v. Welsh (1947) 74 CLR 245 , at pp 262,274; and cf. Ryder v. Foley (1906) 4 CLR 422 , at p 440.  And sometimes an espousal of one view rather than the other has been avoided: see, for example, Reilly v. The King (1934) AC 176, at p 180; Kodeeswaran v. Attorney- General of Ceylon (1970) AC 1111, at p 1118.  If the relationship is contractual, the contract must be consistent with any statutory provision which affects the relationship. No agent of the Crown has authority to engage a servant on terms at variance with the statute.  To the extent that the statute governs the relationship, it is idle to inquire whether there is a contract which embodies its provisions. The statute itself controls the terms of service: McVicar v. Commissioner for Railways (NSW) (1951) 83 CLR 521 , at p 527.  

The Act, as its long title declares, is:   

"An Act to constitute the Education Commission of New South Wales and to specify its functions; to establish the Education Teaching Service and the Technical and Further Education Teaching Service; and to make provisions relating to the employment of persons within those services."

The Education Commission of New South Wales ("the Commission") is a corporation which is subject to the control and direction of the Minister and is "for the purposes of any Act, a statutory body representing the Crown": s 6.  The Act charges the Commission with the performance of diverse functions including the employment of the members of the Service and consultation with the Director-General of Education on the staff establishments for certain categories of positions: Pt II Div.2 and s 38. The Commission has no role to perform in connection with the promotion and transfer of members of the Service.  Those matters are determined by the Director-General: s 38(1)(h). Conditions of employment are determined by the Commission pursuant to s 25 which provides:   

"Except in so far as provision is otherwise made by law, the conditions of employment, including salaries, wages or other remuneration, of members of the Teaching Services shall be as may be determined from time to time by the Commission."

 

A member of the Service is "deemed to be employed by the Government of New South Wales in the service of the Crown" (s 42), but not under the provisions of the Public Service Act 1979 (NSW): s 43.  For certain limited purposes, namely, for the purpose of making any determination under s 25 or for the purpose of proceedings before industrial tribunals, the Commission itself is deemed to be the employer: ss 24, 42.  Section 91 provides that a member of the Service "may sue for and recover the amount of his salary, wages or other remuneration the subject of a determination under section 25".  

The Governor determines the staff establishment of positions above the level of staff inspector (s 46(1)) and the Director-General, after consultation with the Commission, determines the teaching staff establishment for schools, the staff establishment for staff inspectors and inspectors of schools, and the staff establishment for certain positions concerned with advising, controlling or supervising teachers in schools: ss 38(1)(b), (c), (d), (2).  The members of the Service who may be appointed to positions in the Service are either officers or temporary employees: see the definition of "officer" in s 4(1) and Pt IV Div.2.  Except for those officers who became members of the Service by reason of their employment under the Teaching Service Act 1970 (NSW) (s 45) and certain senior officers taken into the Service from the Public Service (s 46(3)), members of the Service are appointed to their respective positions by the Director-General: ss 46(2), 47, 48, 49, 50.  Section 47 of the Act provides for appointment by the Director-General of appropriately qualified persons to "permanent positions" in the Service in the categories whose staff establishments he is empowered to determine.  He may appoint temporary employees to these positions: s 50. He is empowered to appoint appropriately qualified persons to the senior categories whose staff establishment is determined by the Governor, but those appointments require the approval of the Commission: s 46(2).  

The Director-General is empowered by s 50(1) to appoint temporary employees "to any position to which he is entitled to make an appointment under section 47", that is, to "permanent positions in the Education Teaching Service".  He is empowered by s 51 to appoint officers to serve temporarily in positions other than those to which they are permanently appointed.  That section provides: 

"(1)

Subject to subsection (2), an officer of the Education Teaching Service may be temporarily appointed by the Director-General of Education to a position within that service which is vacant or the holder of which is suspended, sick or absent.

(2)

An appointment under subsection (1) shall not be made except in accordance with such conditions of employment as are determined by the Director-General of Education with the concurrence of the Commission.

(3)

The Director-General of Education shall not make a temporary appointment under subsection (1) of an officer of the Education Teaching Service to carry out the duties of a permanent position for a period in excess of 6 months unless he is satisfied that an appointment in excess of that period should be made having regard to the exigencies of that service."

Thus the Director-General is authorized to appoint an officer to a vacant position temporarily and to fix the period of the appointment subject to the restriction contained in sub-s(3).  

The only power which the Director-General had to appoint Mr Suttling temporarily as a Senior Education Officer Class 2 was the power conferred by s 51.  There seems to have been some notion, expressed in the advertisement, that an officer of the Service could be seconded (presumably by the direction or with the consent of the Director-General) to a new position on whatever terms might be agreed between the officer and the Director-General.  The Act contains no provision other than s 51 pursuant to which an officer might be seconded. The term "seconded" is used in reg.6 of the Education Teaching Service Regulation 1982, made under s 100 of the Act, but no power of secondment is created by the Regulation.  The Director-General is given no authority to enter into any contract on behalf of the Crown with an officer whereby the officer is to serve temporarily in a position which does not answer the description in sub-s(1), or whereby the officer's conditions of employment would not be determined in accordance with sub-s(2) or whereby the term of the appointment is fixed otherwise than in conformity with sub-s(3). The authority conferred on the Director-General by s 37(2) to "take such action as he deems appropriate" for the purpose of exercising his responsibility to the Minister for the general conduct and the efficient, effective and economical management of the functions and activities of the Service does not empower the Director-General to ignore the limitations which the Act places upon the particular powers conferred upon him.  

In the present case, there is no reason to think that Mr Suttling's appointment to the position of Senior Education Officer Class 2 at Strathfield for a period of two years was not made in pursuance of and in conformity with s 51.  Whether that appointment be treated as contractual or as merely statutory, it is to be presumed that it was validly made and that Mr Suttling became entitled to the rights which flowed from it.  That is to say, he was entitled to the conditions of employment determined pursuant to s 51(2).  

Although the Commission's role under s 51(2) is to decide whether to concur in the Director-General's determination of the conditions of employment for performing the temporary duties, when the Commission decides to concur that decision amounts to a determination by it (as well as by the Director-General) of the conditions of employment. An officer who performs the duties of an office to which he has been temporarily appointed is therefore entitled under s 91 to sue for and recover the amount of the salary, wages or other remuneration, so determined, that is unpaid.  If an officer is wrongfully prevented from performing the duties of his position and thereby earning the salary specified in his conditions of employment, he is entitled to damages for wrongful dismissal: see Williamson v. The Commonwealth (1907) 5 CLR 174 ; Lucy v. The Commonwealth ; McVicar v. Commissioner for Railways (NSW), at p 528.  It follows that Mr Suttling had a legal right to be allowed to perform the duties of the position of Senior Education Officer Class 2 at Strathfield for the period of his appointment and thereby to earn the salary specified in his conditions of appointment unless the premature termination of the appointment was effected in exercise of some overriding power.  Again it is necessary to refer to the Act and to other statutes which bear upon the security of tenure of employees of the Crown in the positions they hold.  

It is convenient to mention first the statutory powers conferred on the Director-General by ss 71, 72 and 73. Section 71 contains a power of compulsory transfer, but a member of the Service is liable to be transferred compulsorily from one position to another position only if the latter position is the equivalent in classification and salary to the former.  The Milson's Point position was not. Section 72 empowers the Director-General to dispense with the services of a member of the Service in circumstances of no present relevance. Section 73 provides that an officer appointed to a particular position is liable to have his salary reduced and to be appointed to a lower position in the Service if the maximum salary fairly appropriate to the work actually being performed by an officer is less than he is entitled to under the relevant determination, and if the Director-General cannot assign him sufficient work of a class appropriate to his salary.  When action is taken under s 73 on the ground that appropriate work or an appropriate position is not available, the officer's rights of future promotion are protected: s 73(2).  It was not suggested that the circumstances might have made s 73 applicable in the present case.  

The tenure of an officer of the teaching service is affected by s 97 of the Act which provides: 

"(1)

Subject to subsection (3), nothing in this Act shall be construed or held to abrogate or restrict the right or power of the Crown to dispense with the services of any person employed in a Teaching Service.

(2)

An officer or temporary employee of a Teaching Service shall not be entitled to any compensation by reason of any reduction of his salary or of his services being dispensed with, whether under this section or otherwise.

(3)

Subsections (1) and (2) do not apply so as to affect the rights, under any other Act, of any person whose salary has been reduced or whose services have been dispensed with to appeal against the decision or determination reducing his salary or dispensing with his services or to be reinstated to a Teaching Service."

The Crown's right to dismiss an employee at will may be abrogated or restricted by statute (Gould v. Stuart) but equally it may be preserved by statute: see Young v. Adams (1898) AC 469; Miller v. Stephen (1913) 17 CLR 397 , at p 413. However, even if the Crown's right to dispense with the services of a member of the Service is unrestricted that right does not confer on the Crown (and, a fortiori , does not confer on the Director-General as a statutory officer) a power to reduce the position or salary of a Crown employee who has been appointed pursuant to statute to a position which entitles the holder to a particular salary.  If a Crown employee is dismissed from the Crown's service and then accepts reappointment to the Crown's service at a lower level and salary than he previously enjoyed, the practical result may be that his position and salary are reduced (see Kodeeswaran, at p 1123) but the employee must first be validly dismissed (Faithorn v. Territory of Papua (1938) 60 CLR 772 , at p 793) and then be validly reappointed: Day v. Hunkin (1938) 61 CLR 65 , at p 75. An unrestricted power to dismiss at will from the Crown's service does not import a power to reduce the position and salary of a Crown employee whose services are retained.  Mr Suttling was neither dismissed nor reappointed.  Nor, for that matter, did the Crown (or the Commission) purport to terminate prematurely his appointment as a Senior Education Officer Class 2.  It was the Director-General who purported to do so, and the question is whether he had the necessary authority.  

It may be that the position to which Mr Suttling had been temporarily appointed was abolished by the Director- General in exercise of his power to determine staff establishments under s 38(1)(d).  The evidence does not disclose whether, or how, that position ceased to exist. When the office to which a Crown employee is appointed is validly abolished, the employee loses the benefit of the appointment unless he is able to invoke some statutory protection.  Though the Crown may not have satisfied a condition affecting its exercise of a power to dismiss the employee, the employee is not kept in office if the office is abolished: Young v. Waller (1898) AC 661. That principle invites consideration of the power of the Director-General to abolish positions while they are occupied by members of the Service.  Members of the Service are protected in their membership and salary by the provisions of the Government and Related Employees Appeal Tribunal Act 1980 (NSW) as amended ("the GREAT Act"): s 97(3) of the Act.  The legislature can hardly have intended that when it conferred on the Director-General power to determine staff establishments, the Director-General was thereby empowered to destroy the security of employment and conditions of employment which the GREAT Act was enacted to protect.  The abolition of positions is no doubt necessary from time to time in order to achieve "efficient, effective and economical management of the functions and activities of the Education Teaching Service" (s 37(1)) and, when a position is abolished, either the services of the person occupying the position must be dispensed with or he must be transferred to some other suitable post.  But the express provisions of ss 71, 72 and 73 confer the powers which the legislature deemed appropriate for this purpose and it may be inferred that the legislature did not intend the exercise of the general administrative powers of the Director-General (including the power to abolish positions) should otherwise prejudice the security of tenure and salary of permanent appointees to positions in the Service.  

Temporary appointments are a different case.  The powers of compulsory transfer conferred by ss 71 and 73 do not appear to be directed to temporary appointments which, unless the exigencies of the Service so require, are not made for a period in excess of 6 months.  The power to make a temporary appointment, unlike the other powers of appointment conferred on the Director-General, may be exercised by making an appointment for a fixed period. The powers of compulsory transfer conferred by ss 71 and 73 are ill-suited to application in such a case.  If one endeavours to apply s 71 to a case where a temporary appointee is receiving a salary higher than the salary appropriate to his permanent position, the power could be exercised to direct the transfer to a permanent position at the equivalent higher salary. As a decision to make a temporary appointment is not appealable under the GREAT Act (see s 21(1)(a) of the GREAT Act), the regimen governing promotions would be circumvented if s 71 were applicable to temporary appointments.  

The security of tenure and salary in respect of a temporary appointment depends on whether the power of removal from the position to which the temporary appointment is made is limited so that a temporary appointee cannot be removed before the period of appointment has expired.  A power of removal is conferred upon the Director-General by s 30 of the Interpretation Act 1897 (NSW).  That section, referred to in the judgments in the Court of Appeal but not expressly canvassed in argument, provides: 

"30.

  Wherever by any Act power is given to Her Majesty, or to the Governor or to any officer or person, to make appointments to any office or place, it shall, unless the contrary intention appears, be intended: -

(a)

  That such power shall be capable of being exercised from time to time, as occasion may require; and,

(b)

  That Her Majesty or the Governor, or such officer or person shall have power to remove or suspend the person appointed, and to appoint permanently or temporarily, as the case may require, another person in his stead, or in the place of any deceased, sick, or absent holder of such appointment."

 

The exercise of the power of removal thus conferred on the Director-General is confined by s 23 of the GREAT Act, to which reference will presently be made. But the first question is whether the power to remove a temporary appointee from the position to which he is appointed is itself so limited that it cannot be exercised to abbreviate the period of appointment. That question arose for consideration in Geddes v. Magrath; Morgan v. Geddes. In that case, each of the plaintiffs, Messrs Magrath and Morgan, were the holders of a public office. Each had been appointed by the Governor-in-Council.  Mr Magrath was appointed as deputy industrial commissioner for 5 years under s 6(4) of the Industrial Arbitration (Amendment) Act 1926 (NSW) which expressly authorized the Governor to fix the period of appointment.  Mr Morgan was appointed as chairman of conciliation committees for 5 years under s 8(1) of that Act which did not expressly authorize the Governor to fix the period of appointment.  Before either period of appointment had expired, both offices were abolished by statute.  The statute abolishing the offices conferred on the holders of the offices a right to compensation for loss of office, thus excluding the application of the principle in Young v. Waller.  Compensation had to be assessed as though the holder had been unlawfully deprived of office. In assessing that compensation, some members of the Court found it necessary to consider whether the power of removal contained in s 30 of the Interpretation Act was limited so that the Governor could not have abbreviated the period of appointment of the respective plaintiffs.  A distinction was drawn between the plaintiffs which, though immaterial to the result in that case, is instructive for present purposes. In the case of Mr Morgan, Starke and Dixon JJ. said (at p 533):   

"Sub-sec. 1 of sec. 8 of the Industrial Arbitration (Amendment) Act 1926 does not fix or expressly empower the Minister to fix a period for which a chairman of conciliation committees should hold office.  We agree with the view that sec. 30 of the Interpretation Act 1897 applies to sec. 8(1), and, accordingly, that the Minister had authority to suspend or remove a chairman from his office notwithstanding that a fixed term had been specified in his appointment."

Rich J. appears to have shared that view (at pp 530-531). Mr Magrath's period of appointment was fixed pursuant to an express power and the general power of removal was limited to give effect to the period fixed pursuant to the express power: see per Starke and Dixon JJ. at p 535, and the judgment of Harvey A.C.J. in the Full Court (1933) 34 S.R. (NSW) 25, at p 31.  The power to fix a period of temporary appointment is not expressly conferred on the Director-General by s 51 of the Act, but the power is nonetheless conferred by necessary implication: see sub-s(3).  It follows that a period of appointment fixed pursuant to that section cannot be abbreviated without cause.  If the Director-General proposes to remove a temporary appointee from his position for cause before the fixed term of his appointment has expired, it would be necessary to observe any of the applicable requirements of Pt IV Div.6 of the Act and of Pt III Div.2 of the GREAT Act. But it is not necessary to consider those provisions, for the Director-General did not purport to remove Mr Suttling from his position for any cause other than his intention to close down the Consultancy Service at Strathfield.  That reason provides no ground for the exercise of the general power of removal.  The power to abolish positions in determining staff establishments and the power of removal conferred by s 30 of the Interpretation Act are both general in nature; neither can be exercised in derogation of the rights of members of the Service created pursuant to the power to make particular appointments under s 51.  It follows that the premature termination of Mr Suttling's appointment is not supported by s 30 of the Interpretation Act and that Mr Suttling was wrongfully required to quit his position at Strathfield.  

It was assumed by Mr Suttling and by the representatives of the Director-General that the position which might have been available at Arncliffe was a different position from that to which Mr Suttling had been appointed at Strathfield. It was not a case merely of a change of working location for the same position.  That assumption was adhered to in the course of the litigation. The only relevance of the possibility of Mr Suttling's appointment to the Arncliffe position, had he applied for it, would have been to the issue of damages.  That was not argued on appeal and should not now be considered. Therefore the appeal should be dismissed .