FEDERAL COURT OF AUSTRALIA

Danthanarayana v Commonwealth of Australia [2014] FCA 552

THE COURT ORDERS THAT:

1.    The whole of the Further Amended Statement of Claim filed on 22 August 2012 be struck out.

2.    Pursuant to s 31A of the Federal Court of Australia Act 1976 (Cth) and r 26.01(1)(c) of the Federal Court Rules 2011, the claims for damages and exemplary damages made by the applicants, or either of them, against the respondents, or one or more of them, based upon the tort of civil conspiracy, misfeasance in public office and s 52 and s 82 of the Trade Practices Act 1974 (Cth) be summarily dismissed.

3.    As a consequence of Orders 1 and 2 above, the proceeding as against the second to eighth respondents be wholly dismissed.

4.    The first applicant, Wajira Danthanarayana, have leave to endeavour to replead a case for damages in negligence against the first respondent, the Commonwealth of Australia.

5.    By 27 June 2014, the first applicant, Wajira Danthanarayana, serve and lodge with the Associate to Foster J a draft Amended Originating Application and draft Second Further Amended Statement of Claim in which he pleads such claims in negligence against the Commonwealth as he may be advised consistent with Reasons for Judgment of Foster J delivered this day and by which he deletes from his claims for relief and pleading all claims made by the second applicant, Nirvana Consulting Pty Ltd, all claims against the second to eighth respondents and all other claims against the first respondent, the Commonwealth of Australia.

6.    By 18 July 2014, the solicitors for the Commonwealth of Australia inform the solicitors for the first applicant, Wajira Danthanarayana, whether the Commonwealth opposes the grant of leave to the first applicant to file and serve an Amended Originating Application and Second Further Amended Statement of Claim in conformity with the drafts served upon the solicitors for the Commonwealth in accordance with Order 5 above.

7.    The proceeding be adjourned to 9.15 am on 1 August 2014 before the A.C.T. List Judge, at which time the Court will consider whether leave to amend should be granted as sought by the first applicant.

8.    The applicants pay the respondents’ costs of and incidental to the Interlocutory Application filed by the respondents on 7 August 2012.

9.    The costs of and incidental to the said Interlocutory Application may be taxed forthwith.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

1    In this proceeding, the applicants claim damages, exemplary damages, interest and costs against eight respondents.

2    The first respondent is the Commonwealth of Australia. The second to eighth respondents are individuals, all but one of whom were, at all relevant times, senior public servants employed in the Commonwealth Public Service and working in the Department of Defence (DOD). The second to eighth respondents are:

    Brett Lawrence Billett (second respondent);

    Margaret Anne Sykes in her capacity as the Executor of the Estate of the late Robert John Sykes (third respondent);

    Mark Andrew Wales (fourth respondent);

    Michael John Pope (fifth respondent);

    Anne Marion Brown (sixth respondent);

    Peter John Sinfield (seventh respondent); and

    Francis Xavier Roberts (eighth respondent).

3    Robert John Sykes, who is now deceased, was also a senior public servant employed by the Commonwealth at all relevant times.

4    The claims for damages made by the applicants are founded upon four distinct causes of action.

5    One of the causes of action pleaded against the Commonwealth by the second applicant, Nirvana Consulting Pty Ltd (Nirvana), is a claim for damages pursuant to s 82 of the Trade Practices Act 1974 (Cth) (Trade Practices Act) for misleading and deceptive conduct (as to which see s 52 of that Act).

6    At the hearing before me, Senior Counsel for the applicants abandoned the applicants’ claims against the Commonwealth under the Trade Practices Act (Transcript p 136 ll 17–27). For that reason, that claim will be struck out and summarily dismissed.

7    The other cause of action pleaded against the Commonwealth is a claim for damages for negligence.

8    As against the second to eighth respondents, the individual public servants, both applicants claim damages in tort for conspiracy.

9    In addition, as against the eighth respondent, both applicants claim damages for misfeasance in public office.

10    Finally, both applicants claim exemplary damages in respect of the torts of negligence and conspiracy and in respect of their claims that the eighth respondent was guilty of misfeasance in public office.

11    The respondents contend that the current pleading relied upon by the applicants (the Further Amended Statement of Claim filed on 22 August 2012) (FASOC) is wholly defective, does not disclose a reasonable cause of action and is liable to be struck out. The respondents also contend that the applicants have no reasonable prospect of successfully prosecuting any of the claims made in the Originating Application and in the FASOC.

12    By Interlocutory Application filed on 7 August 2012 (the respondents’ Interlocutory Application), the respondents sought orders that the whole of the FASOC be struck out, that all of the applicants’ claims be summarily dismissed and for costs.

13    By these Reasons for Judgment, I determine the respondents’ Interlocutory Application.

Some Background Matters

14    The first applicant, Wajira Danthanarayana, is a Sri Lankan by birth who has lived almost his entire life in Australia. He came here at the age of four and received both his secondary and tertiary education at Australian institutions.

15    Mr Danthanarayana is the sole director and shareholder of Nirvana. He is an Information Computer Technology Solutions Architect Project Manager and Program Manager. Nirvana was generally used by him as the entity through which his services would be provided to those who wished to contract for those services.

16    By the second or third directions hearing in this matter, the respondents had taken up with the solicitors for the applicants in considerable detail the many deficiencies which the respondents saw in the applicants’ then current pleading. In addition, there was an argument about particulars in the offing.

17    Confronted with these circumstances and wishing to endeavour to get to the substance of the respondents’ complaints as quickly as possible, on 11 May 2012, I ordered the applicants to file and serve by 22 June 2012 all affidavits upon which they proposed to rely at the final hearing of this proceeding. The purpose of my making that order was to ensure that, if and when the respondents brought forward an application for summary dismissal or strike out, the applicants would have had a fair and reasonable opportunity to bring forward the case which they intended to run at trial so that any application for summary dismissal would be considered against the whole of the applicants’ evidentiary case. That order was made without any serious opposition from the solicitor for the applicants who appeared for those parties on 11 May 2012. On the same occasion, I was informed by the applicants’ solicitor that the witnesses who would be called in the applicants’ case were the first applicant, Mr Danthanarayana, and perhaps some others, but not many others. I was told that Mr Danthanarayana would prove the case which the applicants sought to bring to trial and that the other witnesses would corroborate his version of events as required.

18    On 26 June 2012, the applicants filed a lengthy affidavit affirmed by Mr Danthanarayana pursuant to the order which I had made on 11 May 2012. They also filed an affidavit sworn by Jonathan Toze on 27 June 2012. Mr Toze is a Commonwealth employee who works in the DOD.

19    Both of the affidavits to which I have referred at [18] above were read and relied upon at the hearing of the respondents’ Interlocutory Application.

20    At the directions hearing held on 6 July 2012, Senior Counsel for the applicants informed me that the applicants may wish to file further evidence. However, he agreed with the proposition that the two affidavits to which I have referred were sufficient to sustain the pleading on a challenge for summary judgment and/or strike out.

21    By the time of the hearing of the respondents’ Interlocutory Application, the parties were proceeding upon the basis that I should not be required to read and consider the entirety of Mr Danthanarayana’s affidavit affirmed on 26 June 2012 but should only be required to look at certain extracts from that affidavit. The extracts from that affidavit relied upon by each side of the record were specified in schedules provided to me for the purposes of that hearing. I was also asked to read and consider the affidavit of Mr Toze.

22    The respondents did not file any evidence which addressed or took issue with the many assertions contained in Mr Danthanarayana’s affidavit of 26 June 2012. For that reason, in order to determine the respondents’ Interlocutory Application, I should and will approach that determination upon the basis that the assertions contained in Mr Danthanarayana’s affidavit are true although, of course, I do so only for the purposes of the present application.

23    The matters to which I will now refer are taken from Mr Danthanarayana’s affidavit of 26 June 2012.

24    Between late 2005 and late 2010, most of Mr Danthanarayana’s income was earned by his services being provided to the DOD as an independent contractor through Nirvana or, alternatively, through a partnership called “Professional Consultancy in Information Technology” which was a partnership between Mr Danthanarayana and others, and through third party service providers which were generally recruitment agencies.

25    Mr Danthanarayana has a Computer Science Engineering Degree and a number of industry qualifications.

26    From March 1989 to 2000, Mr Danthanarayana was employed as a Commonwealth Public Servant in various agencies. In 2000, and thereafter for a short time, he worked as a contractor to the Commonwealth Department of Finance.

27    In the period from 2001 to 2005, Mr Danthanarayana resumed employment in the Commonwealth Public Service.

28    In 2005, Mr Danthanarayana left the Public Service and began working for the DOD as a contractor. His first contract with the DOD commenced on 9 May 2005 and lasted until 24 October 2006. His second contract with the DOD was for the period November 2006 to September 2008. Thereafter, with the exception of two months (November 2009 and January 2010), Mr Danthanarayana and Nirvana were contracted continuously to the DOD throughout the period from 1 October 2008 up to and including 30 June 2011. In the period from 1 October 2008 to 30 June 2011, Mr Danthanarayana’s services were provided to the DOD pursuant to several separate contracts.

29    In order to work for the DOD, Mr Danthanarayana needed a security clearance. By late 2007, he had been granted a security clearance to the level of Top Secret.

30    In February 2008, Mr Billett (the second respondent) became Branch Head of the section in which Mr Danthanarayana was then working. According to Mr Danthanarayana, he and Mr Billett did not get on and, as the calendar year 2008 progressed, Mr Billett became more demanding of him and less content with Mr Danthanarayana’s work performance.

31    In about mid-September 2008, Mr Danthanarayana was advised that there may be issues with one of the recruitment providers towards the end of 2008 and that he may need to move to a direct source arrangement in order to secure ongoing work. Having been advised of this, he telephoned Mr Wales (the fourth respondent). In the conversation which then ensued, Mr Wales yelled at Mr Danthanarayana down the phone, accusing him of padding out his contract and delaying completion of the tasks required to be completed by him.

32    In his affidavit, Mr Danthanarayana asserted that Mr Billett deliberately delayed renewing his contract at the end of 2008 and also deliberately delayed approving various submissions and projects at that time and in the early part of 2009.

33    In about June 2009, another level of management was established above Mr Danthanarayana with the appointment of Mr Sykes (whose Executor is the third respondent). According to Mr Danthanarayana, Mr Sykes thereafter continually made disparaging remarks to him, some of which were possibly racist and most of which were disparaging of contractors generally upon the basis that they were overpaid and did not provide value to the Commonwealth.

34    In October 2009, Mr Danthanarayana discussed with co-workers the difficulties which he was then having with Mr Wales and Mr Sykes.

35    Towards the end of October 2009, a meeting was held attended by Mr Sykes, other workers and Mr Michael Pope (the fifth respondent).

36    Subsequently, another co-worker, Ms Walters, advised Mr Danthanarayana to make a formal complaint about the behaviour of Messrs Wales and Sykes.

37    On 5 November 2009, Mr Danthanarayana made such a formal complaint to his immediate superior. That complaint was referred to Anne Brown (the sixth respondent).

38    Over the next 12 months, Mr Danthanarayana and Nirvana continued to be contracted to the DOD although, according to him, his difficulties with Messrs Wales and Sykes continued. In early 2010, Mr Danthanarayana’s security clearance was surrendered by him. He was then required to again go through the process of applying for a security clearance. He complains that the process was deliberately slowed down by the DOD (Messrs Billett, Sykes and Wales). Eventually, he lodged a formal complaint about the way in which his security clearance application was being handled.

39    Mr Sinfield, who is the seventh respondent, enters the story in about September 2010 in connection with Mr Danthanarayana’s complaint about the lack of progress in his security clearance application.

40    Mr Roberts was appointed at this time to consider whether Mr Danthanarayana should be granted a Top Secret Negative Vet security clearance (Level 2).

41    In his affidavit, Mr Toze said that, after Mr Toze had offered Mr Danthanarayana a contractor position with CIOG (a division of the DOD), he had been told by Mr Sykes that he (Sykes) would not work with Mr Danthanarayana at all because Mr Danthanarayana had lodged complaints against Mr Billett, Mr Wales and him. Mr Toze said that, after meeting with Mr Sykes, he did not proceed to engage Mr Danthanarayana.

42    In his affidavit, Mr Danthanarayana records many instances where he was spoken to harshly by Mr Billett, Mr Sykes and Mr Wales, almost always because of dissatisfaction by those persons with his performance as a DOD contractor. Mr Danthanarayana’s perception seems to be that he was being victimised and bullied for no good reason and that Messrs Billett, Sykes and Wales (and possibly Mr Pope also) were intent on driving him out of the DOD as a contractor.

43    According to Mr Toze, however, Mr Sykes did not demand or even suggest that CIOG should not retain Mr Danthanarayana. Rather, he simply made the point that he would not work with him.

44    In addition, it is quite clear that, despite Mr Danthanarayana’s perceptions, he was continually engaged by the DOD (with the exception of the two months which I have already noted) for almost three years from 1 October 2008 to 30 June 2011.

Strike Out and Summary Judgment (Relevant Principles)

45    The relevant principles were not in issue at the hearing before me.

Strike Out

46    The respondents relied upon r 16.21 of the Federal Court Rules 2011 (FCR). Particular emphasis was placed upon r 16.21(1)(c), (d) and (e).

47    For the purposes of r 16.21(1)(e), the power to strike out a pleading because it discloses no reasonable cause of action will be exercised only in a plain and obvious case. Leave to replead will be refused if no reasonable amendment can cure the alleged defect and there is no reasonable question to be tried (Polar Aviation Pty Ltd v Civil Aviation Safety Authority (2012) 203 FCR 325 at [43] (p 337)).

48    An ambiguous or evasive pleading will be struck out because it is apt to cause confusion. Similar notions underpin the power of the Court to strike out a pleading if it is likely to cause prejudice, embarrassment or delay in the proceeding.

49    Generally speaking, the question of whether a pleading should be struck out will be determined by reference to the pleading alone. However, in an appropriate case, evidence may be led.

Summary Dismissal

50    In Shammas v Canberra Institute of Technology [2014] FCA 71, I summarised the principles to be applied when the Court comes to consider exercising its power to summarily dismiss a proceeding pursuant to s 31A of the Federal Court of Australia Act 1976 (Cth) (FCA) in light of the High Court’s decision in Spencer v Commonwealth (2010) 241 CLR 118. At [50], I said:

…

(a)    The power to order summary dismissal pursuant to s 31A is different from the power to strike out defective pleadings pursuant to a rule of Court in the terms of O 11 r 16 of the Federal Court Rules 1979.

(b)    The power to terminate proceedings summarily should be exercised with caution.

(c)    There must be a high degree of certainty that the claimant cannot succeed if the proceeding is allowed to go to trial in the ordinary way.

(d)    There must be “no reasonable prospect of success”. This is a different concept from the concept of “no real prospect of success”. The statutory admonition is that a proceeding may be found to have no reasonable prospect of successful prosecution even if it is not hopeless or bound to fail. This test constitutes a radical departure from previous regimes which required that the proceeding must be shown to have no prospects of success.

51    At [51]–[52], I went on to say:

As I observed at [13] above, I am of the view that the test for summary dismissal laid down by r 26.01(a) FCR is the same test as the test for summary dismissal specified in s 31A of the Federal Court Act.

Rule 26.01(c) FCR provides that a respondent may apply to the Court for an order that a claim be summarily dismissed if no reasonable cause of action is disclosed in the applicant’s pleadings. Under this rule, an applicant for an order summarily dismissing a proceeding is required to demonstrate that there is no possibility that the claimant’s claim can succeed.

The Applicants’ Causes of Action

Conspiracy

52    As I have already noted, the applicants claim damages and exemplary damages for the tort of civil conspiracy as against the second to eighth respondents only.

The Conspiracy as Pleaded

53    In the FASOC, the conspiracy case is pleaded in pars 43 to 46E. Those paragraphs are in the following terms:

43.    The Second, Third, Fourth, Fifth, Sixth, Seventh and Eighth Respondents conspired and combined amongst themselves with the predominant purpose of injuring or damaging the First Applicant’s business and earning capacity.

(a)    The Second, Third and Fourth Respondents repeatedly made statements to the effect that the they would not accept the First Applicant to be contracted by the First Respondent and would take steps to ensure that the First Applicant was not contracted to perform work for the First Respondent. The First Applicant repeats paragraphs 10(i), (k), (p) and (q), 11(e), (f), (j), (m) and (n) and 13(a), (b), (d), (f), (g) and (i) above.

(b)     The Second, Third, Fourth and Sixth Respondents took steps to prevent the First Applicant being contracted to perform work for the First Respondent and refused to approve contracts being entered into with the First Applicant or which involved the First Applicant performing work for the First Respondent. The First Applicant repeats paragraphs 10(k), (p) and (q), 12(j), (n), (o) and (p), 13(b), (i) and (k), 15A(a), (b) and (c) and 19(b) above.

(c)    The First Applicant made complaints to the Sixth Respondent with respect to the conduct of the Second, Third and Fourth Respondents, including that the Second, Third and Fourth Respondents had threatened to and had taken action to prevent the First Applicant performing work for the First Respondent and the Sixth Respondent took no appropriate and reasonable steps to address the complaints and prevent the Second, Third and Fourth Respondent from taking steps to prevent the First Applicant obtaining further work for the First Respondent. The First Applicant repeats paragraphs 16(d), (e), (f), (g), (l) , (m) and (n), 19, 20, 21, 22 and 23 above.

(d)    The Seventh Respondent recommended that the First Applicant’s application for a security clearance be refused and the Eighth Respondent made a decision to refuse the First Applicant’s application for security clearance in circumstances in which the First Applicant had not committed any security breaches and there was no reasonable basis upon which security clearance should have been refused. The First Applicant repeats paragraphs 30–42 above.

(e)    In or around November 2010, the Eighth Respondent directed Mr Timothy Slattery and the Seventh Respondent not to engage with the First Applicant and told Mr Slattery that the Eighth Respondent would not meet with the First Applicant.

44.     In pursuance and furtherance of the said conspiracy, the Second, Third, Fourth, Fifth, Sixth, Seventh and Eighth Respondents did the following overt acts, namely:

(a)    The Second, Third, Fourth, Fifth and Sixth Respondents took steps to prevent the First Applicant being contracted to perform work for the First Respondent and refused to approve contracts being entered into with the First Applicant or which involved the First Applicant performing work for the First Respondent. The First Applicant repeats paragraphs 10(k), (p) and (q), 12(j), (n), (o) and (p), 13(b), (i) and (k), 15A(a), (b) and (c) and 19(b) above.

(b)    The Sixth Respondent failed to take appropriate and reasonable steps to address the complaints made by the First Applicant with respect to the conduct of the Second, Third and Fourth Respondents and prevent the Second, Third and Fourth Respondent taking steps to prevent the First Applicant obtaining further work for the First Respondent. The First Applicant repeats paragraphs 16(d), (e), (f), (g), (l), (m) and (n), 19, 20, 21, 22 and 23 above.

(c)    The Fifth Respondent took steps to cause the First Applicant to complete documentation in the form of a ‘XP101-Cessation of Duties’ form having the effect of causing his security to be cancelled. The First Applicant repeats paragraphs 14(e) and 25-29 above.

(d)    The Second, Third, Fourth and Fifth Respondents caused allegations to be made alleging, without proper basis, that the First Applicant had engaged in security breaches in the course of his work. The First Applicant repeats paragraphs 10(q), 12(p), 13(k), 14(f) and 30 above.

(e)    The Seventh Respondent recommended that the First Applicant’s application for a security clearance be refused and the Eighth Respondent made a decision to refuse the First Applicant’s application for a security clearance in circumstances in which the First Applicant had not committed any security breaches and there was not reasonable basis upon which security clearance should have been refused. The First Applicant repeats paragraphs 30-42 above.

(f)    In or around November 2010, the Eighth Respondent directed Mr Timothy Slattery and the Seventh Respondent not to engage with the First Applicant and told Mr Slattery that the Eighth Respondent would not meet with the First Applicant.

45.     Each of the acts of the Second, Third, Fourth, Fifth, Sixth, Seventh and Eighth Respondents specified in the preceding paragraph 44 hereof was done by the person or persons therein alleged on behalf of himself or themselves and his or their co-conspirators in furtherance of the said conspiracy.

45A.     Each of the acts of the Second, Third, Fourth, Fifth, Sixth, Seventh and Eighth Respondents specified in paragraph 44 hereof was undertaken in the course of and within the scope of the Second, Third, Fourth, Fifth, Sixth, Seventh and Eighth Respondents’ employment with the First Respondent or their authority as agents thereof.

46.     By reason of the matters pleaded above, the First Applicant has lost the custom of the First Respondent, has lost other business opportunities and has been put to considerable trouble, inconvenience and expense and has suffered loss and damage.

Particulars

(a)     Loss of income;

(b)     Damage to future prospects of entering into contracts with the Service Providers and loss of opportunities to earn income;

(c)     Damage to professional and personal reputation;

(d)     Full particulars of damage will be provided closer to trial.

46A.     In the alternative, at least the Second, Third, Fourth and Fifth Respondents conspired and combined amongst themselves with the predominant purpose of injuring or damaging the First Applicant’s business and earning capacity.

(a)    The Second, Third and Fourth Respondents repeatedly made statements to the effect that the they would not accept the First Applicant to be contracted by the First Respondent and would take steps to ensure that the First Applicant was not contracted to perform work for the First Respondent. The First Applicant repeats paragraphs 10(i), (k), (p) and (q), 11(e), (f), (j), (m) and (n) and 13(a), (b), (d), (f), (g) and (i) above.

(b)    The Second, Third and Fourth Respondents took steps to prevent the First Applicant from being contracted to perform work for the First Respondent and refused to approve contracts being entered into with the First Applicant or which involved the First Applicant performing work for the First Respondent. The First Applicant repeats paragraphs 10(k), (p) and (1), 12(j), (n), (o) and (p), 13(b), (i) and (k), 15A(a), (b) and (c) and 19(b) above.

46B.    In pursuance and furtherance of the said conspiracy, the Second, Third. Fourth and Fifth Respondents did the following overt acts, namely:

(a)    The Second, Third and Fourth Respondents took steps to prevent the First Applicant being contracted to perform work for the First Respondent and refused to approve contracts being entered into with the First Applicant or which involved the First Applicant performing work for the First Respondent. The First Applicant repeats paragraphs 10(k), (p) and (q), 12(j), (n), (o) and (p), 13(b), (i) and (k), 15A(a), (b) and (c) and 19(b) above.

(b)    The Fifth Respondent took steps to cause the First Applicant to complete documentation in the form of an ‘XP101-Cessation of Duties’ form having the effect of causing his security to be cancelled. The First Applicant repeats paragraphs 14(e) and 25–29 above.

(c)    The Second, Third, Fourth and Fifth Respondents caused allegations to be made alleging, without proper basis, that the First Applicant had engaged in security breaches in the course of his work. The First Applicant repeats paragraphs 10(q), 12(p), 13(k), 14(f) and 30 above.

46C.    Each of the acts of the Second, Third, Fourth and Fifth Respondents specified in paragraph 46B hereof was done by the person or persons therein alleged on behalf of himself or themselves and his or their co-conspirators in furtherance of the said conspiracy.

46D.     Each of the acts of the Second, Third, Fourth and Fifth Respondents specified in paragraph 46C hereof was undertaken in the course of and within the scope of the Second, Third, Fourth and Fifth Respondents’ employment with the First Respondent or their authority as agents thereof.

46E     By reason of the matters pleaded above, the First Applicant has lost the custom of the First Respondent, has lost other business opportunities and has been put to considerable trouble, inconvenience and expense and has suffered loss and damage.

Particulars

(a)     Loss of income;

(b)     Damage to future prospects of entering into contracts with the Service Providers and loss of opportunities to earn income;

(c)     Damage to professional and personal reputation;

(d)     Full particulars of damage will be provided closer to trial.

54    It can be readily seen from the terms of the paragraphs themselves that the pleader has incorporated into pars 43–46E many assertions made from time to time in earlier paragraphs of the FASOC. For example, par 43 picks up certain subpars of par 10, 12, 13, 15A and 16 and also incorporates pars 19, 20, 21, 22, 23 and 25–42.

55    It seems that par 43 is intended to plead the material facts relied upon by the applicants as establishing the existence of the alleged conspiracy. Paragraph 44 is intended to identify the overt acts carried out by the conspirators in pursuance and furtherance of the alleged conspiracy. Paragraph 45 is intended to capture the notion that all of the acts done by each of the individuals was done on his or her own behalf and on behalf of the other conspirators.

56    Curiously, par 46A pleads an alternative conspiracy to that which is pleaded in par 43. This conspiracy is said to involve only the second to fifth respondents.

57    Counsel for the respondents filed and served a detailed Written Submission dated 6 August 2012 in which he made detailed submissions as to the fundamental defects in the FASOC. He also developed those submissions in oral submissions before me. Senior Counsel for the applicants did not grapple in detail with the significant points made on behalf of the respondents by their Counsel in respect of the applicants’ conspiracy case. His general response was that the conspiracy case should be allowed to go to trial because it is essentially fact dependent and very reliant upon the drawing of inferences from primary material.

58    In par 10 of the FASOC, the applicants allege that, from about 4 February 2008, Mr Billett bullied and harassed Mr Danthanarayana and took steps to prevent Mr Danthanarayana from being contracted to perform work for the Commonwealth and refused to approve contracts being entered into with Mr Danthanarayana or which involved Mr Danthanarayana performing work for the Commonwealth. In par 10, the applicants go on to list a number of events and circumstances which they contend justify the more general introductory averment to which I have referred.

59    In par 43(a) of the FASOC, the first event or circumstance relied upon by Mr Danthanarayana as a material fact relevant to establishing the formation of the alleged conspiracy is set out in par 10(i) of the FASOC. In that subparagraph, the applicants allege that, on or about 24 December 2008, Mr Billett yelled at Mr Mountstephen, an employee at CIOG who was responsible for managing Mr Danthanarayana, and said that he would rather “cut off his nose” than accept any contract extension proposals for Mr Danthanarayana. The second event relied upon is that which is referred to in par 10(k) of the FASOC. In that subparagraph, it is alleged that, on or about 26 February 2009, Mr Danthanarayana was told by an unidentified person that Mr Billett did not want Mr Danthanarayana to be awarded a further contract by Talent International (ACT) Pty Ltd.

60    In subpars (p) and (q) of par 10 of the FASOC, the applicants make further allegations to the effect that Mr Billett stood in the way of Mr Danthanarayana obtaining further opportunities with the DOD and the Defence Material Organisation (DMO) in late December 2009 and in January and February 2010.

61    In similar vein, in par 12 of the FASOC, it is alleged that Mr Sykes bullied and harassed Mr Danthanarayana and also took steps to prevent him from getting work from the Commonwealth. In that paragraph, the applicants list a number of incidents said to justify the general allegation of bullying. Those incidents spanned the period from about 5 August 2009 to February 2010. As was the case with Mr Billett, only some of the matters pleaded in par 12 are incorporated into par 43.

62    Again, in similar vein, Mr Wales is the subject of bullying allegations in par 13 of the FASOC, some of which are incorporated into par 43.

63    Although, in par 14 of the FASOC, the applicants allege that the fifth respondent (Mr Pope) also bullied and harassed Mr Danthanarayana from about November 2009, none of the allegations made against Mr Pope are incorporated into par 43 of the FASOC. Notwithstanding that fact, the applicants maintain an allegation of conspiracy against Mr Pope in par 43.

64    Ms Brown, who is the sixth respondent, is said to have taken steps to prevent Mr Danthanarayana being contracted to perform work for the Commonwealth and otherwise to block his getting contracts (as to which, see par 15A of the FASOC). She is said to have become involved in the alleged conspiracy from about mid-November 2009.

65    At pars 16–42 of the FASOC, the applicants catalogue all of the complaints made by Mr Danthanarayana from time to time in relation to the alleged bullying and harassment directed towards him by Messrs Billett, Wales, Sykes and Pope and also the complaints which he made about the lack of progress of his fresh security clearance application made in February 2010.

66    In par 43(d) of the FASOC, the applicants focus on the conduct of Mr Sinfield, the seventh respondent, and Mr Roberts, the eighth respondent, by asserting that they were involved in the refusal of Mr Danthanarayana’s security clearance application.

67    As I have already noted, in par 44 of the FASOC, the applicants plead the so called overt acts which were undertaken by various of the respondents in pursuance and furtherance of the alleged conspiracy. Some of the alleged overt acts are the same acts relied upon as demonstrating the existence of a conspiracy.

68    The alternative conspiracy pleaded in pars 46A ff of the FASOC follows a similar format.

The Relevant Principles

69    The law governing the tort of conspiracy has been authoritatively explained by the High Court in two cases in the 1930s (McKernan v Fraser (1931) 46 CLR 343; and Cox v Journeaux (No 2) (1935) 52 CLR 713).

70    In McKernan, at 361–362, Dixon J said

But on behalf of the respondents the cause of action in conspiracy was also supported upon the ground that the appellant was party to a combination which had for its object the wilful infliction of damage upon the respondents. This assumes that the end is not in itself unlawful, that the means are not unlawful, and that no threat of an illegality is made in furtherance of the combination. It appears now to be settled that for a combination or acts done in furtherance of the combination to be actionable in such circumstances, the parties to the alleged conspiracy must have been impelled to combine, and to act in pursuance of the combination, by a desire to harm the plaintiff, and that this must have been the sole, the true, or the dominating, or main purpose of their conspiracy. At any rate, so I understand the doctrine which has slowly won its way to final acceptance by the House of Lords (Sorrell v Smith (1925) AC 700). To adopt a course which necessarily interferes with the plaintiff in the exercise of his calling, and thus injures him, is not enough. Nor is it enough that this result should be intended if the motive which actuates the defendants is not the desire to inflict injury, but that of compelling the plaintiff to act in a way required for the advancement or for the defence of the defendant's trade or vocational interests. There is some evidence in the present case that the appellant was embittered towards one at least of the respondents, but a consideration of the whole evidence establishes, in my opinion, that what actuated the meetings of the branch and the appellant in pursuing the policy which the branch adopted, and he probably advocated, was the desire and the purpose of compelling the promoters of the rival Union to desist from the project by depriving them of employment and making manifest to their followers the unwisdom of adhering to them.

71    At 398–403 in McKernan, Evatt J articulated the elements of the tort of civil conspiracy. At 398, his Honour said:

The last three quotations indicate broadly the special finding of fact which alone enables the Mogul Case (1892) AC 25 and Quinn v Leathem (1901) AC 495 to be fitted into the same principle of law. Lord Shand asserts the existence in Quinn v Leathem of a combination intended to cause harm, and causing it for the "sole purpose" of hurting the plaintiff. If such finding is a condition precedent to liability in these cases, it approximates closely to the "disinterested malevolence" referred to by Cardozo C.J.

Whilst it is necessary for a plaintiff to show, not only that the acts injuring him are those of a combination entered into for such purpose, but that the combination possesses the additional character or quality of being “malicious”, no recognised formula has yet been adopted by the Courts in order to ascertain such character or quality.

I think that some light is thrown upon the question of principle by attempting an analysis of the evidence that is usually led in a case of “conspiracy to injure”. It is seldom that any criminal conspiracy can be proved by direct evidence of the making of the agreement; usually the inference as to the fact of agreement must be drawn from the proved actions of the defendants. In civil cases of conspiracy to injure the existence of a combined purpose is sometimes shown by giving evidence of the actual terms of a decision come to by a professional or trade organisation. It is almost impossible to suppose that an intention to cause injury for a merely malicious purpose would appear from the terms of such a resolution. The aspect of policy as distinct from the personal aspect is usually found predominant in the records of such bodies. The present case is no exception.

72    His Honour then posited three examples (at 398–399) and continued:

In the present examples I am assuming that the defendants have combined to do certain acts which must necessarily cause temporal harm or injury to a plaintiff or a class of which the plaintiff is one. I have also assumed that the harm to the plaintiff is "intended" by all parties to the agreement. The infliction of such harm may also be called their "object" or "purpose." Each of these two words indicates the conscious pursuit of some end or goal or the presentation to the actors of such end or goal as a desirable thing. It may be more accurate to call the immediate end or goal the "purpose" of the combination, and the ultimate end or goal sought, the "object" of the person who enters the combination. If each party has the same ultimate "object" that is also the "object" of the combination. In this sense the "object" desired by each and all is also the "motive" both of each individual and of the combination. It may be that the "intention" or immediate "purpose" of the persons combined is to inflict harm, but their "motive" or ultimate "object" is the furtherance of their trade interests. It may be, on the contrary, that the "motive" or ultimate "object" beyond the immediate "purpose" or "intention" of the combination is to do harm, because the plaintiff is hated for some personal reason, and his harm or ruin is desired as an end to be achieved by means of inflicting harm upon him.

I am quite aware that with this terminology many psychologists would not rest satisfied. But the difficulty is, as the references I have already given show, that the Courts have not separately defined a number of these expressions. In certain relations the words employed tend to have the same meaning, but in other relations they have meanings which are quite distinct.

"Though it is easy", said Lord Dunedin, "on the strict view of the meaning of the words to draw a distinction between motive and intention, yet the meaning of the one runs into the other, and in the set of cases I have quoted I think they are used as synonymous" (Sorrell v Smith (1925) AC 700 at p 724.

So long, however, as the meaning of the words used is kept clear the substance of Lord Sumner's suggestion will be followed. I therefore return to the illustrations already enumerated.

73    His Honour then proceeded to discuss in greater detail the examples which he posited at 399. Ultimately, at 403, his Honour said:

Lord Dunedin's decision is that a court or jury should be able to say what is the real motive which lies at the root of every common design to cause hurt or harm to another. The question for the jury is:—

You must consider whether the act or acts complained of which caused loss and hurt to the plaintiff were done with the purpose of injuring the plaintiff. Was such a purpose the real root of the acts that grew from it, or was the true motive of the acts something else, such as for instance the furtherance of the defendant's own business? (per Lord Dunedin in Sorrell v Smith (1925) AC 700 at p 717.

If this principle applies, the question is approached by asking whether the predominant motive or object of the defendants is to protect or defend their association, trade or professional interests; any proved hostility or dislike to the plaintiff must be further analysed in order to ascertain whether it is a motive related to a clash of economic or professional interests, and arises from strong opinions as to the plaintiff's own conduct in relation thereto; whether, on the other hand, the hostility or dislike is not a result of the feelings and attachments of the defendants to the economic and professional interests which they allege they are advancing or defending, but has its true source in personal hatred or bitterness.

74    Thus, for a combination or acts done in furtherance of the combination to be actionable, where the end is not in itself unlawful (the present case) and the means are not unlawful (also the present case) and no threat of illegality is made in furtherance of the combination (also the present case), the parties to an alleged conspiracy must have been impelled to combine, and to act in pursuance of the combination, by a desire to harm the plaintiff and this must have been the sole, the true or the dominating or main purpose of their conspiracy. It is not sufficient to adopt a course of action which inevitably interferes with the plaintiff in the exercise of his calling and thus injures him without having the requisite purpose.

75    In Cox, Dixon J (at 717) specifically approved the observations made by Evatt J at 399 ff in McKernan. At 718–719 in Cox, Dixon J explained why the defendants in that case were entitled to take steps to revolt against the control of the chairman and managing director if they thought it was in the best interests of the relevant corporation to do so. The mere fact that their actions might injure the chairman and managing director was not sufficient to make out the tort of conspiracy. In Cox, Dixon J summarily dismissed the action because he took the view that it was clearly hopeless.

Consideration

76    In their Originating Application, conspiracy is alleged against all of the second to eighth respondents. The conspiracy so alleged is a conspiracy to injure both applicants.

77    In the FASOC, at pars 43–45, the alleged conspiracy is said to be directed to harming Mr Danthanarayana only although the allegation against all of the second to eighth respondents is maintained. In par 46A ff, the alternative conspiracy is said to be directed against Mr Danthanarayana alone but, in that paragraph, the conspirators are confined to the second to fifth respondents. The essential framework of these allegations is confusing and not consistent with the claims for relief made in the applicants’ Originating Application.

78    In support of his claim for damages for conspiracy, Mr Danthanarayana points to a series of disparate acts pleaded earlier in the FASOC as acts constituting bullying and harassment and attempts by the individuals concerned to prevent his being contracted to the DOD and the DMO. I pause to note that, nowhere in either par 43, 44 or 46A is there any particular allegation made against the fifth respondent (Mr Pope). Notwithstanding those matters, Mr Pope is the subject of a general conspiracy allegation in par 43 and a further conspiracy allegation in par 46B of the FASOC and thus is dragged into the consequential allegations in par 46C, 46D and 46E of the FASOC.

79    Counsel for the respondents submitted that:

In order to establish an “unlawful purpose” conspiracy, it is necessary to show that each conspirator shares the predominant motive of causing pecuniary harm to the plaintiff. Two aspects of this requirement are to be noted:

(a)    That motive must be held by each individual said to be a party to the conspiracy. An “evil motive” proved to exist in one or more cannot be imputed to other persons, even if they be involved in actions which the others are undertaking with the predominant motive of injuring the plaintiff. And if only one person has the necessary evil motive, neither they nor any of the others can be liable.

(b)    It is not enough that the defendants know that their actions will cause financial harm. Such harm may be inevitable but if it is brought about by persons motivated by an ultimate objective of protecting their own trade or business, it will not be a conspiracy. To be actionable, the predominant motive, or ultimate goal, must be the infliction of harm upon the plaintiff.

80    These submissions are correct and I accept them.

81    Counsel went on to submit that the catalogue of disparate actions referred to in pars 10, 12, 13, 14, 15(a) and 16–42, even if fully proved, are incapable of supporting any inference that the individual respondents were each motivated by the requisite evil purpose. The actions of each and every one of them are easily explained as being carried out in furtherance of their genuine desire to protect the Commonwealth. This submission is made more compelling when careful consideration is given to the precise matters relied upon in par 43 of the FASOC as constituting the material facts from which the alleged combination is to be inferred.

82    Although par 10 commences its account of events in February 2008, the first occasion described in par 10 which is then relied upon by the applicants as some basis for the alleged conspiracy took place in February 2009 (as to which, see subpar 10(k)). The incident which took place on that occasion involved Mr Billett alone.

83    The next incident relied upon occurred at or about the same time. This incident concerned Mr Wales alone. Then, according to the applicants, the next incident relied upon as a basis for inferring a conspiracy took place in November 2009 when Mr Sykes is said to have told Talent International (ACT) Pty Ltd not to extend, renew or enter into any further contracts with Mr Danthanarayana. This conduct is attributed to Mr Sykes alone. At about the same time, according to the applicants, Ms Brown became involved in the alleged conspiracy by failing to act in some unspecified way in relation to Mr Danthanarayana’s complaints made at about that time.

84    Then, according to the applicants, in January and February 2010, Mr Sykes and Mr Pope caused a security breach to be levied against Mr Danthanarayana which, according to the applicants, was later found to be unsubstantiated. Subsequently, according to the pleading, other actions were taken on an individual basis by various of the respondents.

85    Prior to February 2009, none of the third to eighth respondents did anything which could be construed as harmful to Mr Danthanarayana. In February 2009, Mr Billett is said to be involved in some unspecified way in preventing Mr Danthanarayana obtaining a project manager contract with Talent International (ACT) Pty Ltd. The particular allegation made in respect of Mr Billett is not that he took action to prevent the award of such a contract but rather that someone told Mr Danthanarayana that Mr Billett had somehow made clear to someone that he did not want Mr Danthanarayana to be awarded that contract. The same allegation is made against Mr Wales. Taken individually or together, this second-hand relaying of something the relaying of which had no impact upon Mr Danthanarayana is not capable of forming a satisfactory basis for alleging that Mr Billett and Mr Wales conspired against Mr Danthanarayana.

86    The next relevant period of time is November 2009 where allegations are made against Mr Sykes and Ms Brown. The allegations are different in each case. Mr Sykes is alleged to have endeavoured to prevent Mr Danthanarayana obtaining a further contract from Talent International (ACT) Pty Ltd while Ms Brown is accused of failing to deal adequately with Mr Danthanarayana’s complaints. Once again, there is no basis upon which these facts could justify an allegation of conspiracy involving Mr Billett, Mr Wales and Ms Brown.

87    The next period is December 2009 to February 2010. Conduct is pleaded against each of Mr Billett, Mr Sykes, Mr Wales and Mr Pope. Mr Sinfield is dragged in at the heel of the hunt. These allegations concern the reporting of alleged security breaches by Mr Danthanarayana which were ultimately found to be unsubstantiated. As is the case with all previous allegations, the conduct which is criticised and identified as the basis for inferring a conspiracy is equally consistent with the due performance of their duties by the senior public servants concerned. They took action to deal with what they perceived to be reportable security breaches on the part of Mr Danthanarayana.

88    The FASOC does not clearly allege when the alleged conspiracy was formed, who were parties to it from time to time and what facts, matters and circumstances will be relied upon as a basis for inferring the existence of the alleged combination.

89    The applicants have had several opportunities to get their house in order and have been unable to do so. Senior Counsel for the applicants informed me that the FASOC was his clients’ considered final position and that, in the event that I was against the applicants, he did not wish to have leave to replead his clients’ case.

90    In my judgment, the applicants have failed to plead sufficient material facts to justify making and maintaining the allegation of conspiracy. The matters relied upon as demonstrating the existence of the conspiracy are equally capable of innocent explanation and do not inexorably point to the making of any combination on the part of any of the second to eighth respondents.

91    Furthermore, the alleged overt acts relied upon by the applicants constitute nothing more than a circular recitation of essentially the same matters said to form an adequate basis for the existence of the alleged combination. I think that I am justified in concluding that the applicants have no proper basis for alleging conspiracy against the second to eighth respondents.

92    In addition, Mr Danthanarayana has failed to plead with any precision the damage which he alleges flows from the alleged conspiracy. He did, after all, continue to be retained by the DOD and the DMO long after the involvement of Messrs Billett, Sykes, Wales and Pope had ceased.

93    I propose to strike out all of the paragraphs in the FASOC relied upon as part of a pleading of conspiracy. I will also summarily dismiss the applicants’ conspiracy case.

Misfeasance in Public Office

94    This claim is brought against Mr Roberts only. Mr Roberts was the person who, on or about 16 May 2011, notified Mr Danthanarayana of his decision rejecting Mr Danthanarayana’s application for a Negative Vetting Level 2 security clearance.

95    At pars 42 and 49A of the FASOC, the applicants allege that Mr Roberts’ decision was unlawfully made. They allege that Mr Roberts failed to make available to Mr Danthanarayana adverse material upon which he proposed to rely and was biased against him or, in the alternative, there was a reasonable apprehension of bias which infected Mr Roberts’ decision.

96    At par 42(e), (f) and (g), the applicants allege:

The Security Clearance Decision was unlawfully made.

…

(e)    The Eighth Respondent was biased or, in the alternative, there was a reasonable apprehension of bias.

Particulars

(i)    The First Applicant lodged workplace grievances against the Second, Third, Fourth, Fifth and Sixth Respondents and in relation to the Seventh Respondent’s handling of the First Applicant’s security clearance vetting as set out in paragraph 16 above.

(ii)    On or about 4 February 2010, the First Applicant’s Top Secret Negative Vetting security clearance was deactivated and the First Applicant applied for a new security clearance in about February 2010.

(iii)    On about 24 November 2010, Mr Timothy Slattery emailed the First Applicant and said that the Eighth Respondent had directed him and the Seventh Respondent not to engage with the First Applicant and that the Eighth Respondent would not meet with the First Applicant.

(iv)    The Seventh Respondent is a friend and former colleague of the Sixth Respondent, who is one of the persons about whom the First Applicant complained.

(v)    The Seventh Respondent was the officer responsible for preparing the recommendation and brief regarding the First Applicant's security clearance application to the decision-maker, the Eighth Respondent.

(vi)    The Seventh Respondent expressly refused to include a report of the First Applicant’s treating psychiatrist, Dr William Knox (‘the Knox Report’), in the recommendation brief to the Eighth Respondent. The refusal is contained in an email from the Seventh Respondent to Mr James Ronald, Solicitor for the Applicants, dated 21 April 2011.

(vii)    The Knox Report criticizes the Australian Government Security Vetting Agency’s handling of the First Applicant’s security clearance application and stated that the relationship between the Sixth Respondent and the Seventh Respondent ‘raised the question of a lack of objectivity in regard to both the assignment of project work to [the First Applicant], and to the process of psychological assessment and evaluation of security capacity.’

(viii)    The Eighth Respondent is a friend and colleague of the Sixth Respondent and the Seventh Respondent.

(ix)    The Security Clearance Decision dated 12 May 2011 states that one reason for the refusal of the First Applicant’s security clearance is the manner with which the First Applicant pursued workplace complaints and grievances.

(f)    The Eighth Respondent made the Security Clearance Decision in bad faith or for an improper purpose, namely, preventing the first Applicant from obtaining employment and contract opportunities with the First Respondent.

(g)    The Eighth Respondent took irrelevant considerations into account as the First Applicant did not commit any security breaches and the security breach allegations were found to be unsubstantiated.

97    The applicants make very serious allegations against Mr Roberts. As Lord Millett said in Three Rivers District Council v Governor and Company of the Bank of England (No 3) [2003] 2 AC 1 at 291–292 [184]–[189], fraud or dishonesty (or, for that matter, bad faith or improper purpose) must be distinctly alleged and just as distinctly proved. Such allegations must be sufficiently particularised. Allegations of this type are not sufficiently particularised if the facts pleaded are equally consistent with innocence as with fraud or dishonesty or improper purpose. This means that a plaintiff who alleges dishonesty must plead the facts, matters and circumstances relied upon to show that the defendant was dishonest and not merely negligent, or otherwise committed errors which were not the result of bad faith or other impropriety, and that facts, matters and circumstances which are equally consistent with innocence do not satisfy these requirements.

98    To similar effect are the observations of Mahoney JA in Rajski v Bainton (1990) 22 NSWLR 125 at 135–136.

99    The matters relied upon by the applicants in par 42 as constituting a basis for their making these very serious allegations against Mr Roberts do not rise to a level which can support those allegations. Mr Roberts’ relationship with Ms Brown and Mr Sinfield, on their own, do not support those allegations and the extraneous material otherwise referred to in that paragraph does not support those allegations.

100    As submitted by Counsel for the respondents, the applicants rely upon two alternative formulations of Mr Roberts’ knowledge. These are:

(a)    That Mr Roberts had actual knowledge that the security clearance decision which he made was unlawful.

(b)    Alternatively, that he recklessly disregarded the extent of his powers and in circumstances where there was a foreseeable risk of harm. This is particularised by the repeated assertions that he ought to have known each of the matters which are said to have made the decision unlawful.

101    In oral submissions before me, Senior Counsel for the applicants disavowed the formulation “ought to have known”.

102    Nonetheless, the allegation that Mr Roberts was guilty of misfeasance in public office was pressed.

103    The elements of this cause of action were articulated by Deane J in Northern Territory v Mengel (1995) 185 CLR 307 at 370 where his Honour said that:

Misfeasance in public office

As Lord Diplock observed, in delivering the judgment of the Privy Council in Dunlop v Woollahra Municipal Council ([19821 AC 158 at 172), the tort of misfeasance in public office is "well-established". Its elements are: (i) an invalid or unauthorised act; (ii) done maliciously; (iii) by a public officer; (iv) in the purported discharge of his or her public duties; (v) which causes loss or harm to the plaintiff. That summary statement of the elements of the tort inevitably fails to disclose some latent ambiguities and qualifications of which account must be taken in determining whether a particular element is present in the circumstances of a particular case. The critical element for present purposes is malice.

In the context of misfeasance in public office, the focus of the requisite element of malice is injury to the plaintiff or injury to some other person through an act which injuriously affects the plaintiff (see Bourgoin SA v Ministry of Agriculture Fisheries and Food [1986] QB 716 at 776-777). Such malice will exist if the act was done with an actual intention to cause such injury. The requirement of malice will also be satisfied if the act was done with knowledge of invalidity or lack of power and with knowledge that it would cause or be likely to cause such injury. Finally, malice will exist if the act is done with reckless indifference or deliberate blindness (cf Owen v Homan (1853) 4 HLC 997 at 1035 [10 ER 752 at 767] per Lord Cranworth LC: “wilful ignorance”) to that invalidity or lack of power and that likely injury. Absent such an intention, such knowledge and such reckless indifference or deliberate blindness, the requirement of malice will not be satisfied.

104    In the same case, the plurality (Mason CJ, Dawson, Toohey, Gaudron and McHugh JJ), at 347, rejected the proposition that misfeasance could be constituted simply by an act of a public officer which he or she knows is beyond power and which results in damage. Both Brennan J (at 357) and Deane J in the passages which I have extracted took the same view.

105    The applicants had no basis for alleging the requisite state of mind against Mr Roberts. There is nothing in the evidentiary material presented to the Court in respect of the respondents’ Interlocutory Application which can sustain this very serious allegation.

106    The case sought to be made by the applicants against Mr Roberts for misfeasance in public office will be struck out and summarily dismissed.

The Applicants’ Case in Negligence

107    At pars 56–58 of the FASOC, the applicants plead a case in negligence. Those paragraphs are in the following terms:

Breach of duty of care to provide a safe system of work

56.     The First Respondent owed the First Applicant a duty to take reasonable care to avoid exposing him to risk of injury to his person, mental health and reputation occasioned by the acts of the First Respondent's employees.

Particulars

(a)     During the term of the Contracts, the First Applicant was required to work at premises controlled by the First Respondent.

(b)     During the term of the Contracts, the First applicant was subject to the direction and control of employees of the First Respondent.

(c)     The First Respondent had control over the acts of its employees and the First Applicant relied on the First Respondent to control its employees.

(d)     The First Applicant was vulnerable to the acts of the First Respondent’s employees.

(e)     The First Respondent owed the First Applicant a duty to provide a safe system of work.

57.     By virtue of the facts pleaded in paragraphs 10, 12-14, 16 and 25-43 above, the First Respondent breached the duty it owed to the First Applicant.

Particulars

(a)     The First Respondent failed to prevent the bullying and harassment of the First Applicant by the Second, Third, Fourth and Fifth Respondents.

(b)     The First Respondent failed to protect the First Applicant from victimisation.

(ba)     The First Respondent failed to prevent the conduct of the Second, Third, Fourth and Sixth Respondents that prevented the First Applicant obtaining further work with the First Respondent.

(c)     The First Respondent failed to keep details of the First Applicant’s complaints confidential.

(d)     The First Respondent failed to keep allegations of security breaches by the First Applicant confidential.

(e)     The First Respondent failed to ensure that the First Applicant's application for security clearance was dealt with expeditiously and appropriate.

(f)     The First Respondent failed to ensure that the First Applicant’s application for security clearance was decided impartially and that the First Applicant was accorded procedural fairness.

58.     By reason of the First Respondent’s breach, the First Applicant has suffered and continues to suffer loss and damage.

Particulars

(a)     Loss of income;

(b)     Damage to future prospects of entering into contracts with the Service Providers and loss of opportunities to earn income;

(c)     Offence, humiliation, distress and anxiety;

(d)     Mental harm;

(e)     Physical injury;

(f)     Medical expenses;

(g)     Pain and suffering and loss of enjoyment of life;

(h)     Full particulars of the First Applicant’s loss will be provided closer to trial.

108    It should be noted that this case is pleaded only against the Commonwealth and only on behalf of Mr Danthanarayana.

109    As submitted on behalf of the respondents, the alleged duty is said to be owed by the Commonwealth itself. It is not alleged that the Commonwealth is liable vicariously for the negligent conduct of its employees.

110    In par 57 of the FASOC, Mr Danthanarayana brings into the negligence case which he seeks to run all of the bullying, harassment and contract prevention conduct which he alleges against Messrs Billett, Sykes, Wales and Pope. The substance of the allegations in par 57 is that the Commonwealth itself failed to take steps to prevent the conduct of its servants.

111    Counsel for the respondents submitted that, when considering whether the Crown itself has knowledge of facts relevant to establishing a duty (including a duty of care), or must be taken to have known those matters, it is necessary to consider whether the person or people with the relevant knowledge could be said to be the directing mind of the Crown (see HMS Truculent: The Admiralty v The Divina (Owners) [1951] 2 All ER 968; and Western Australia v Watson [1990] WAR 248).

112    Mr Danthanarayana has not pleaded any facts which identify who, for present purposes, was the directing mind of the Commonwealth and has failed to plead facts which, if proved, could show that the Commonwealth as a legal entity separate from its employees and officers, knew or ought to have known of the alleged risks to Mr Danthanarayana.

113    Senior Counsel for the applicants did not come to grips with these difficulties. At times I thought that he was, contrary to the pleading, arguing that the Commonwealth was, in fact, vicariously liable.

114    Counsel for the respondents went on to submit that the imposition of the alleged duty directly on the Commonwealth would conflict with other duties owed by the Commonwealth.

115    There is considerable force in these submissions but, in the view which I take of the negligence case sought to be run by Mr Danthanarayana, it is not necessary to traverse the respondents’ submissions in any more detail.

116    As presently pleaded, Mr Danthanarayana’s case in negligence does not, in my view, rely upon vicarious liability as a basis for attributing liability to the Commonwealth.

117    Notwithstanding that Senior Counsel for Mr Danthanarayana disavowed any application that his clients should be given leave to replead, I think that Mr Danthanarayana should be given an opportunity to articulate more precisely the negligence case which he intends to take to trial. As matters presently stand, I think that there are difficulties with a case based upon a duty of care being owed by the Commonwealth directly to Mr Danthanarayana although I am inclined to think that such a case would not be impossible for Mr Danthanarayana to plead and run. In the circumstances, I think that it may well be possible for him to plead and conduct a case in negligence against the Commonwealth as being vicariously liable for the conduct of its employees.

118    I will, therefore, strike out the negligence case as currently pleaded but give leave to Mr Danthanarayana to endeavour to replead that case in conformity with these Reasons for Judgment.

Conclusions

119    In my judgment, the FASOC does not disclose a reasonable cause of action for the tort of civil conspiracy, for misfeasance in public office or for damages under the Trade Practices Act. In any event, in my view, the applicants do not have a reasonable prospect of successfully prosecuting any of those causes of action with the consequence that each of those causes of action should be summarily dismissed pursuant to s 31A of the FCA and r 26.01(1)(c) FCR. In addition, the present pleading in respect of negligence is deficient and should be struck out. I propose to give Mr Danthanarayana (and only Mr Danthanarayana) one last opportunity to endeavour to plead a claim in negligence as against the Commonwealth. I intend to do so upon the basis that any further pleadings be submitted both to the Court and to the respondents for consideration prior to leave to file same being finally granted.

120    The respondents have substantially succeeded in their challenge to the FASOC. For that reason, I think that they should have their costs of and incidental to their Interlocutory Application.

121    There will be orders accordingly.

Associate:

Dated:    28 May 2014