Industrial Relations Commission of New South Wales CITATION : D & R Commercial Pty Ltd and Flood [2002] NSWIRComm 88 APPELLANT: D & R Commercial Pty Ltd PARTIES : RESPONDENT: Kathleen Margaret Flood FILE NUMBER: IRC 3169 of 2001 CORAM: Wright J President; Walton J Vice-President; Tabbaa C CATCHWORDS : Appeal - Unfair dismissal - Appeal by employer - Allegations of misconduct found to be unsubstantiated at first instance - Allegations found unsubstantiated on basis of assessment of credit of evidence of appellant's witnesses - Assessment of credit based in part on comments made during conciliation proceedings - Dismissal found to be harsh, unreasonable or unjust on both procedural and substantive grounds - Commissioner considered reinstatement impracticable and ordered payment of compensation - Appeal alleged denial of procedural fairness by Commissioner - Monetary order made without regard to terms of s 89 - Appellant alleged denial of procedural fairness based on failure to bring to parties' attention inferences drawn by Commissioner having regard to comments made in conciliation proceedings - Appeal against findings of credit made having regard to material during conciliation proceedings - Appeal against assessment of compensation - Appellant contended denied procedural fairness in not being given an opportunity to respond to respondent's contentions on amount of compensation - Whether denial of procedural fairness - Commission required to afford procedural fairness - Fairness requires that a party be given the opportunity to meet the case relied on - Fairness requires observations taken into account against a party to be brought to party's attention - Denial of procedural fairness - Extent of findings open to Commissioner on the evidence - Leave to appeal granted - Appeal upheld in part. Evidence Act 1995 s 189 LEGISLATION CITED : Industrial Relations Act 1991 s 209 s 252 Industrial Relations Act 1996 Part 6 Ch 2 s 84 s 89 s 163 s 173 s 181 s 188 Antonakopoulos v State Bank of New South Wales (1999) 91 IR 385 Browne v Dunn (1893) 6 R 67 (HL) Burge v BHP Steel Pty Ltd (2001) 105 IR 325 Cash Converters v Yildiz (1999) 94 IR 474 CGEA Transport Ltd t/as Southtrans v Transport Workers' Union of Australia (2001) 110 IR 211 Employer's Federation of New South Wales v Greco (1993) 51 IR 451 Government Insurance Office of New South Wales v Bailey (1992) 27 NSWLR 304 Integral Energy v Allen [2001] NSWIRComm 193 Jones v National Coal Board [1957] 2 QB 55 Kassem v Crossley [2000] NSWCA 276 Kelly v Foley (1993) 51 IR 331 Knowles v Anglican Church Property Trust (No.2) (1999) 95 IR 380 Llandilo Staircases Pty Ltd v WorkCover Authority of New South Wales (Inspector Parsons) (2001) 104 IR 204 Metropolitan Meat Industry Board v Australasian Meat Industry Employees' Union, New South Wales Branch [1973] AR (NSW) 231 CASES CITED : Mitchforce v Starkey and Anor [2002] NSWIRComm 85 Outboard World Pty Ltd v Muir (1993) 51 IR 167 Ozwide Real Estate Pty Ltd v Department of Industrial Relations (Inspector Gibson) (2001) 103 IR 177 Pastrycooks Employees, Biscuit Makers Employees & Flour & Sugar Workers Union (NSW) v Gartrell White (No.2) (1990) 35 IR 60 Price v Box Valley Pty Ltd (1999) 90 IR 480 Public Service Association of New South Wales and Department of Corrective Services and Anor (unreported, Full Commission, 9 December 1994) Ridge Consolidated Pty Ltd v WorkCover Authority of New South Wales (Inspector Mauger) (2000) 100 IR 156 Riley v Australian Grader Hire Pty Ltd (2001) 103 IR 143 Seymour Australian Broadcasting Commission (1977) 19 NSWLR 219 Stead v State Government Insurance Commission (1986) 161 CLR 141 Sunny Queen Limited t/as Australian Quality Egg Farms v Reilly [2000] NSWIRComm 1128. Sykes v Alan East Pty Ltd (Formerly National Meat Supplies Pty Ltd) [2000] NSWIRComm 1130 Van Huisstede v Commissioner of Police (No.2) (2001) 106 IR 56 Warren v Coombes (1978) 142 CLR 531 Westfield Holdings v Adams [2001] NSWIRComm 293 Wilson v Department of Education and Training (2000) 100 IR 1 HEARING DATES: 09/06/2001; 09/24/2001 DATE OF JUDGMENT: 05/15/2002 APPELLANT: Mr D D Knoll of counsel Marsdens, Solicitors (Mr Grant Butterfield) LEGAL REPRESENTATIVES: RESPONDENT: Ms M A Kumar of counsel Walsh & Blair, Lawyers (Mr Tim Abbott) JUDGMENT: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM: Wright J, President Walton J, Vice-President Tabbaa C Wednesday 15 May 2002 Matter No IRC 3169 of 2001 D & R COMMERCIAL PTY LTD and KATHLEEN MARGARET FLOOD Application for leave to appeal and appeal against a decision of Commissioner Cambridge given on 11 April 2001 in Matter No IRC 3539 of 2000 DECISION OF THE COMMISSION [2002] NSWIRComm 88 1 These proceedings concern an application for leave to appeal and, if leave is granted, an appeal by D & R Commercial Pty Ltd against a decision and orders of Cambridge C given on 11 April 2001. The proceedings at first instance concerned an application brought pursuant to s 84 of the Industrial Relations Act 1996 by the present respondent Kathleen Margaret Flood alleging that her dismissal by the respondent was harsh, unreasonable or unjust. Cambridge C held that the dismissal was harsh, unreasonable and unjust and made consequential orders under s 89 of the Industrial Relations Act. 2 The appellant conducted a real estate agency business in which the respondent was formerly employed as a real estate property officer. She had been employed by the appellant for some nine months prior to her being dismissed orally. On 30 June 2000, the appellant informed the respondent that her employment was to be terminated. One week's notice was given. The reasons given alleged, essentially, that she had been guilty of misconduct warranting dismissal. Three reasons were provided: the respondent had received six bottles of wine from a client for the provision of professional services free of charge by the appellant; the respondent's use of the appellant's work telephone for personal calls; and generally unsatisfactory behaviour which included denigrating the employer's business to clients and tradespeople and acting in a rude and abusive manner. 3 The application for relief was filed by the respondent on 20 July 2000. It was claimed that the dismissal was harsh, unjust and unreasonable as the decision to dismiss was made without the respondent having been given any warning nor an opportunity to respond to the reasons given; that the reasons for dismissal were not valid; and finally that the notice provided was not reasonable given her age and medical condition. 4 The application proceeded for conciliation on 18 August 2000 before Commissioner Cambridge. Conciliation proved unsuccessful and the matter proceeded to arbitration. The commissioner issued his decision on 11 April 2001 in which he found the dismissal to be harsh, unreasonable and unjust, and that reinstatement would be impracticable. He made consequential orders requiring the appellant to pay to the respondent an amount of $13,455 representing 23 weeks of the respondent's pre-dismissal remuneration. 5 There are two issues requiring determination on appeal. The first is the extent to which a Member of the Commission may have regard to statements made in conciliation proceedings, in subsequent arbitration proceedings presided over by that Member. The second relates to the extent to which a Member of the Commission is required to bring to the parties' attention, observations against the interest of a party on which the member intends to base relevant crucial findings. The decision at first instance 6 At the hearing of the application before the commissioner, the appellant sought to resist the claim for reasons somewhat different to those provided to the respondent at the time of dismissal. The primary bases on which the appellant resisted the claim at first instance were that the respondent had provided professional services in the form of the preparation of lease documents, free of charge, for which she received six bottles of wine from the client (the lease fee work issue); and that the respondent had caused to have prepared inaccurate payslips for the purposes of assisting her to obtain a loan without the appellant's consent (the payslips issue). 7 The respondent contended that the dismissal was both procedurally and substantively unfair. It was contended the dismissal was procedurally flawed in that she had not been given any counselling as to the alleged difficulties and was given no opportunity to respond to the allegations against her. It was contended the dismissal was substantively unfair as the respondent was not guilty of any misconduct warranting dismissal. The respondent did not deny that the work involving the provision of the lease documents was performed. Rather, it was contended that the appellant had either expressly or impliedly given approval for the lease documents to be prepared free of charge because it was expected that the client would provide substantial ongoing work for the appellant. 8 The respondent conceded that the payslips had been drawn up at her request for the purposes of assisting in the securing of a loan. However, it was submitted that the payslips had been prepared with the full knowledge and consent of the appellant. It was also contended that the reasons purportedly supporting the dismissal had been multiplied for the purposes of the arbitration before the commissioner; that is, these reasons had been "trumped up" for the purposes of supporting the appellant's position. 9 The commissioner identified the "fundamental determinations required in this case" as being related to the issues of the lease work and the payslip arrangements. In his words, those issues had obtained an "overwhelming significance" when compared to the other bases of support for the dismissal. The determination required, in the commissioner's view, was whether the appellant had authorised, expressly or impliedly, the actions taken in either or both of those matters. 10 The commissioner resolved these factual controversies by preferring the evidence of the respondent to that of the appellant's witnesses. The evidence consisted of three witnesses for the appellant: Mr and Mrs Raw, the appellant's two co-directors, and another employee, a Ms Brock. The respondent was the only witness in her case. The commissioner noted that the issue of credit was of considerable importance in the resolution of the factual controversies. 11 The commissioner observed that there were some inconsistencies in the respondent's evidence and that it was unsatisfactory in some respects. However, the respondent was considered overall "to be a witness of truth". On the other hand, the evidence of the appellant's witnesses was variously described as "simply unbelievable" and "bordering on the ridiculous". In particular, the commissioner considered neither Mrs Raw nor Ms Brock were to be regarded as witnesses of truth. 12 The way in which the commissioner approached the question of the evidence of Mr Raw is what has given rise to the complaint on appeal. The commissioner dealt with the evidence of Mr Raw in the following way: [43] The evidence provided by Mr Raw in answer to questions from the Commission during proceedings held on 24 November 2000, needs to be compared with statements made by Mr Raw at an early stage of conciliation proceedings held on 18 August 2000. Firstly, Mr Raw stated as follows in answer to questions from the Commission on 24 November: "Q. It was never discussed with you about there not being a payment. A. Well, no, I said we'd do it, we can do it, but there is a fee to it. There is cost - the paperwork costs us money, to have the paperwork there. We have always charged a fee for anything we've done. We have owners of properties that manage things themselves come to us, and we always charge them a fee for it and they're quite happy to pay it. Q. The applicant says that she discussed this with you, and that you either said or gave her the impression that this could be done for the Russells at no charge. A. No, that would never be done or said. There was only one initial conversation about the leases, about their requesting or looking for some sort of leases for the properties, and it was, you know - if we were to do it, if it was going ahead - because it was still hypothetical at that stage, what they were looking for. It wasn't firmed up in any way in that conversation to say that they needed them or didn't need them. It was never implied in that conversation that there would be no fee. Q. Or a reduced fee? A. No, that (indistinct)" [44] This evidence provided by Mr Raw during the Hearing needs to be compared with statements that he made during the Preliminary Hearing proceedings held on 18 August and the following extract from transcript is relevant: "COMMISSIONER: The applicant thinks that the reasons for the dismissal involve the question of this wine, personal telephone calls and badmouthing the company. Are those factors relevant to the decision to dismiss? RAW: Not - all those factors weren't relevant at the initial stage, but on that particular day, after she had two days off, we had done some looking around and talking to a few people on the grounds that we had discovered that she had been dishonest within the company - by preparing leases for this particular landlord, which she has got a letter from - she did the leasing for that landlord, so she had a reasonably good close relationship with that landlord. Now, initially she approached me saying that that particular landlord wanted to our office to prepare some leases and I said, "Yes, we can do that. We'll work out an amended scale of fee for it because there's still office charges and things that have got to be met in that," and that would have been probably close to two months before apparently it happened. Some time later she was deceptive in preparing those leases. She had asked the receptionist to take the leases home and prepare them at home and the receptionist said, "No, because the typewriter would be missing" [45] Consequently there is stark contradiction between the position that Mr Raw would have the Commission believe in answer to questions during the Hearing, when compared to what he had to say at the Preliminary Hearing. On Mr Raw's own statement made during the Preliminary Hearing, he acknowledged that an amended scale of fees had been discussed and yet his testimony during Hearing was adamant that there was no discussion regarding no fees or a reduced fee. 13 Other inconsistencies between statements made in conciliation or preliminary hearing and at arbitration were taken into account by the commissioner; for example: [47] The applicant stated unequivocally that at the time of dismissal she requested written reasons for dismissal and an Employment Separation Certificate. During his evidence in chief, Mr Raw provided the following evidence: "Q. Have you ever been asked for a separation certificate from the applicant in respect of these proceedings? A. No. I haven't." [48] This testimony needs to be compared with the following extract of transcript from the Preliminary Hearing: "COMMISSIONER: There's been mention of the fact, that apparently, there's no letter of dismissal. RAW: Not as yet, no. COMMISSIONER: Not as yet? RAW: Not as yet, No, we haven't done one yet. COMMISSIONER: So the dismissal was done, or implemented, verbally? RAW: It was, yes. COMMISSIONER: Has there been an employment separation certificate provided? RAW: No. That's the one I thought you were referring to actually. No, we haven't done one of those yet, employment separation." 14 Having considered the evidence in the above manner, Cambridge C accepted the respondent's version of events, concluding that the creation of the payslips was done "openly with the involvement of Mrs Raw, and that there could be no finding that the payslips were made for some deceitful purposes or contrary to the interests of the employer". 15 Cambridge C expressed his conclusions in the following terms: [54] The Determination of this matter has primarily involved the settlement of questions of contested fact concerning the alleged substantive basis for dismissal. [55] Having carefully considered all of the evidence, the Commission decides to adopt a preference for the evidence of the applicant rather than that provided by the employer. This preference has been established in part, upon the question of credit, and the substantial deficiencies and inconsistencies that can be identified in the evidentiary case provided by the employer. [56] Consequently the primary issues of contested fact have been resolved in favour of the applicant. Specifically the Commission finds that the applicant did not commit any misconduct in respect to either the lease fee work issue, or the pay slips matter. Consequently the primary substantive basis for the dismissal cannot be supported in fact. [57] Further, in the absence of any opportunity for the applicant to offer an explanation, or make out a defence before being dismissed on 30 June 2000 established clear procedural deficiency. [58] The Commission therefore concludes that the dismissal of the applicant was harsh, unreasonable and unjust. 16 The commissioner considered reinstatement and re-employment impracticable and ordered compensation. The basis for the compensation ordered was: [60] The quantum of compensation has been determined having regard to the applicant's attempts to find alternative employment, and the remuneration received in that alternative employment. The quantum of compensation that has been Ordered has been determined on the basis that had it not been for the unfair dismissal the applicant would have likely enjoyed many years further employment with the employer. Consequently the Commission is prepared to grant the applicant's claim for compensation which was articulated as to represent an amount equivalent to approximately twenty three weeks remuneration. Submissions of the appellant 17 At the outset, Mr D D Knoll of counsel, who appeared for the appellant, stated that the findings at first instance as to the payslips issue were not challenged on appeal. The appeal focussed on the manner in which the commissioner dealt with the evidence of Mr Raw relating to the provision of the lease documents, the findings of unfairness which flowed from that finding and the basis of the monetary orders. 18 It was contended that Cambridge C breached "fundamental principles of fairness in deciding against the employer on the lease fee work issue" and as to the calculation of the sum of money the respondent was ordered to pay. These "fundamental principles" were said to have been breached in a number of respects. First, in determining the quantum of compensation the commissioner relied upon statements made by Mr Flood (the husband of the respondent who represented her at first instance) in closing submissions that were not reflective of the evidence before the Commission and provided no opportunity for the appellant to make submissions in that regard. Second, the commissioner relied upon statements made in conciliation proceedings for the purposes of assessing the credit of an important witness for the appellant. It was not open to the commissioner to have regard to such matters for the purposes of arbitration: Kelly v Foley (1993) 51 IR 331. Third, as an alternative to the second argument, in taking into account statements made in conciliation proceedings, the commissioner made findings adverse to the interests of the appellant without having provided the appellant with an opportunity to be heard or provide any explanation. In taking such a course, it was contended the commissioner breached a fundamental rule of procedural fairness traditionally referred to as the rule in Browne v Dunn (1893) 6 R 67 (HL): Government Insurance Office of New South Wales v Bailey (1992) 27 NSWLR 304; Kassem v Crossley [2000] NSWCA 276. 19 Mr Knoll also made submissions as to an alleged failure in the calculation of the money orders. It was observed that both on appeal and at first instance it has been conceded that the dismissal of the respondent was procedurally unfair. If the Commission were to find that that unfair procedure would warrant a finding that the dismissal was harsh, unreasonable or unjust, that is not the end of the matter. It was further contended that in formulating the monetary orders, the commissioner failed to comply with the requirement of s 89(6) of the Act to take into account income earned in alternative employment following the dismissal. The evidence was that the respondent had obtained full time employment some seven weeks after having been dismissed and had continued to be employed on a full time basis since then, although the pay was at a somewhat reduced rate. Whilst the commissioner expressly said that he had taken the appellant's alternative income into account in making the orders, an examination of the money order made it plain that the moneys earned had not been offset as required by s 89(6). Counsel, however, did not submit that the commissioner erred in making a money order greater than that claimed in the application for relief. 20 As to leave to appeal, the appellant submitted that the issues raised on appeal are not "mere fine points of principle". It was contended that the Commission was bound to observe the principles of procedural fairness. Conciliation proceedings, as a matter of both principle and practice, play an important role in the Commission's jurisdiction. It was submitted that parties will only be forthcoming in conciliation if they are confident that what is disclosed in conciliation remains confidential, "off the record", and that statements made in the course of conciliation will not be held against them should the matter proceed to arbitration: Kelly v Foley, Outboard World Pty Ltd v Muir (1993) 51 IR 167. It was submitted that those were matters of such importance in the public interest as to warrant the grant of leave. The submissions of the respondent 21 Ms M A Kumar of counsel, who appeared for the respondent, submitted leave to appeal should be refused as the appeal did not raise matters of such significance as to warrant the granting of leave in the public interest: Cash Converters v Yildiz (1999) 94 IR 474 at 475. 22 The respondent contended that the primary decision turned largely upon findings of fact as to what constituted the reasons for dismissal. Significantly, the commissioner, despite having noted some difficulties with the respondent's evidence, considered that she was a witness of truth. The evidence of each of the appellant's three witnesses was rejected on the basis that the commissioner considered each witness not to have presented as truthful. The findings of credit led to the rejection of the appellant's version of events in favour of that of the respondent. 23 As to the appellant's submission as to the lease issue, it was submitted that the commissioner was entitled to take matters presented in conciliation into account and there was no obligation to bring to the parties' attention the reliance he intended to place on that material. The rule in Browne v Dunn is a rule of procedural fairness which governs the manner in which the parties present their respective cases. It has not been applied to the member of a tribunal hearing a matter. 24 The respondent submitted, that s 189 of the Evidence Act 1995 lent support, by way of analogy, to her contention as to disclosures in conciliation. Section 189 provides that evidence given on the voir dire is admissible if it is inconsistent with evidence given by the witness in the hearing proper. The commissioner relied on the statements of Mr Raw as they were inconsistent with the evidence given at the arbitration. It was submitted that it would be absurd if the Commission, a body not bound by the rules of evidence, could not have regard to an inconsistent statement, where a court bound by the strict rules of evidence could have regard to such material. 25 As to the alleged breach of the rule in Browne v Dunn, the respondent contended that it concerns the conduct of the parties to the proceedings. There was no obligation on a decision maker to put matters to a witness, which the decision maker considered contradicted the witness's evidence. In any event, the rule is not strictly applicable to an industrial tribunal: Pastrycooks Employees, Biscuit Makers Employees & Flour & Sugar Workers Union (NSW) v Gartrell White (No.2) (1990) 35 IR 60. 26 It was contended that the judgments in Government Insurance Office v Bailey and Kassem v Crossley were distinguishable as they dealt with observations of intangible matters by the trial judge. The evidence in these proceedings was recorded in transcript which could be assessed and reproduced in a decision and contrasted with the evidence at trial. 27 In any event, so it was contended, it was clear from the conduct of the proceedings that Mr Raw's credit was being challenged by the respondent. Where the conduct of proceedings makes it obvious that the credit of a witness is under challenge a failure to expressly challenge that witnesses credit will not necessarily involve a breach of the rule: Seymour Australian Broadcasting Commission (1977) 19 NSWLR 219 at 224 - 225. 28 Further, even if the evidence of Mr Raw was inadmissible, the commissioner found that both Ms Brock and Mrs Raw were not to be believed. It was submitted that the appellant had exaggerated the importance of Mr Raw's evidence and that the decision could safely stand. 29 The respondent submitted, as to the appellant's attack on the money order that the commissioner had observed the requirements of s 89(6) in his decision and considered the post termination employment of the respondent in determining to order a monetary payment of 23 weeks' remuneration. Leave to Appeal 30 Section 188(1) of the Industrial Relations Act provides that an appeal to a Full Bench of the Commission from the decision of a Member of the Commission may be made only by leave of the Full Bench. 31 The principles applicable to the granting of leave to appeal were settled by the Full Bench in Knowles v Anglican Church Property Trust (No.2) (1999) 95 IR 380 at 381. This judgment has been approved, for example, in Sykes v Alan East Pty Ltd (Formerly National Meat Supplies Pty Ltd) [2000] NSWIRComm 1130, Ridge Consolidated Pty Ltd v WorkCover Authority of New South Wales (Inspector Mauger) (2000) 100 IR 156, Riley v Australian Grader Hire Pty Ltd (2001) 103 IR 143 at 144, Llandilo Staircases Pty Ltd v WorkCover Authority of New South Wales (Inspector Parsons) (2001) 104 IR 204 at 206, Ozwide Real Estate Pty Ltd v Department of Industrial Relations (Inspector Gibson) (2001) 103 IR 177, Integral Energy v Allen [2001] NSWIRComm 193 and more recently in Westfield Holdings v Adams [2001] NSWIRComm 293 and Mitchforce v Starkey and Anor [2002] NSWIRComm 85. 32 In Knowles the Full Bench, at 381, held: We have determined that the Commission should not grant leave to appeal pursuant to s188 of the Act. In doing so we do not propose to depart from the general policy and practice of the Commission not to give reasons for the refusal of leave. However, we do propose to make some observations as to the conduct of appeals where the grant of leave is required which are apposite in the present matter. Firstly, as a Full Bench of this Commission noted in Perrott v Xcellenet Australia Limited (1998) 84 IR 255 at 265 , leave will not lightly or automatically be granted. The statutory scheme makes clear that the legislature intended to restrict access to appeals to appropriate cases meeting the public interest test stated in s188(2) . These principles are also applicable to cases involving questions of jurisdiction. The raising of a jurisdictional issue by an appellant does not, of itself, establish a basis for the grant of leave; each case having to be judged against the statutory criterion. The Commission should have regard to the nature of the jurisdictional issue and whether there is a demonstrable case that the Commission has exceeded or failed to exercise its jurisdiction. Clearly, this consideration will involve a question as to whether the decision appealed from was inconsistent with established law and principle. Secondly, it will be relevant to the grant of leave to consider, amongst other factors, whether the appellant has brought, as in this matter, a substantially different case in the appeal. This is not to say that the admission of new evidence per se would have this result, but that the bringing of, in substance, a new or materially different case on appeal may constitute a basis for the refusal of an application for leave to appeal. In Caltex Petroleum Pty Ltd v Harmer [(1999) 92 IR 264], the Full Bench stated: As to the second matter averted to above, we consider that leave would ordinarily, in the absence of changed circumstances, be refused where an appellant raises arguments or presses issues on the appeal which were not squarely raised at first instance; irrespective of whether the relief sought or the outcome contended for by the appellant remains the same or substantially the same... We agree with the principle so stated. Thirdly, it will be relevant to consider whether an appeal raises substantial and important considerations. The issues raised by an appellant as to the public interest considerations under s188(2) need to be evaluated in the light of the nature of the issues raised in the appeal, including whether the appeal raises substantial issues of principle or law or has wider implications for the jurisprudence of this Commission, including whether the decision has widespread practical application. 33 This appeal raises the proper manner in which a Member of this Commission should conduct an arbitration in proceedings under Part 6 of Chapter 2 of the Act alleging unfair dismissal. It also raises the question as to the regard which may be paid to matters raised in conciliation prior to arbitration and whether notions of fairness require members when sitting as the Commission to act in accordance with the rule of procedural fairness referred to as the rule in Browne v Dunn. Applications under the unfair dismissal provisions provide a significant proportion of the work of the Commission. We consider that the appeal raises matters of sufficient importance as to warrant the grant of leave to appeal. The Appeal 34 The approach to be adopted on appeal from unfair dismissal proceedings has been recently stated in Wilson v Department of Education and Training (2000) 100 IR 1 (at [60] - [70]) and restated in Burge v BHP Steel Pty Ltd (2001) 105 IR 325 (at [7] - [8]) and may be accepted without repeating it here. 35 The appellant's primary contention as to the lease fee work issue has been that the commissioner erred in considering matters raised in conciliation for the purposes of determining the credibility of a witness in arbitration. It was submitted, in the alternative, that there was a failure to observe the requirements of natural justice (or as now more usually referred to, procedural fairness) by not providing an opportunity for the appellant's witness to rebut or deal with the inference that was to be drawn from that material. 36 The nature of conciliation proceedings has been considered in a number of earlier decisions. For example, in Public Service Association of New South Wales and Department of Corrective Services and Anor (unreported, Hill and Peterson JJ and Murphy CC, 9 December 1994), the former Full Commission dealt with a submission that a matter should have been reallocated following a request pursuant to s 209 of the Industrial Relations Act 1991 (the statutory predecessor of s 173 of the present statute). 37 The basis for the application was that the trial judge had expressed an opinion in conciliation proceedings which the appellant considered inimical to a fair trial being obtained. The Full Bench expressed its views on the process of conciliation in this way (at 13 - 14): It is in the nature of conciliation that a member of the Commission may both express views to, and receive views from, a party which may be thought to be contrary to the interests of that or the other party in any later arbitration. It is inherently desirable that the member and the parties should not feel constrained from freely engaging in discussions in the pursuit of settlement by the prospect that the expression of views or positions may redound to their later disadvantage if conciliation should fail. Section 209(1) reflects the view that conciliation may be enhanced by the parties being able to freely explore settlement of a claim without that inhibition. 38 The use of material disclosed in conciliation was also discussed by the Full Commission in Kelly v Foley. At first instance, the commissioner took into account matters raised in conciliation proceedings in the assessment of the credibility of a witness. On appeal it was argued that the commissioner had erred in having regard to those matters in assessing the credibility of the witness. The Full Commission agreed at 333 - 334, holding: [Counsel for the appellant] submitted that the scheme of the Act, including the provisions of Part 8 of Chapter 3, requires a differentiation between what occurs in the informal processes of conciliation and what evidence is called and submissions are made in arbitration. He submitted that if the Commission fails to make such a distinction and forms a view adverse to a particular party, either because of matters raised and relied on in conciliation or not so raised, the processes of conciliation and the possibility that they would lead to a resolution of claims without arbitration would be frustrated. [Counsel for the respondent], while not opposing this view, submitted that the Commissioner had not improperly considered matters which had arisen in conciliation and in any event, the Appellant, a solicitor who had chosen to appear for himself before the Commissioner, had not availed himself of the opportunity provided by s209 of the Act, to ask the Commissioner not to arbitrate the matter. … We agree with the submissions of the Appellant that the ordinary rules of natural justice require the Commission to determine a matter being arbitrated on the basis of the evidence called and submissions made before it, considered of course in the context of the relevant legal principles. The Commission must take care, especially in proceedings pursuant to Part 8 of Chapter 3 of the Act, which envisages conciliation, then arbitration with the possibility of further conciliation intervening, that the conduct of a party in conciliation proceedings does not inappropriately influence the view which is taken of the evidence and submissions made in arbitration. One obvious reason for this is that in the interests of achieving a settlement a party may not wish to raise in conciliation a matter upon which it would properly wish to rely in arbitration if the matter is not settled. Another is that evidence is given on oath in arbitration, where in the ordinary course it is tested in cross-examination. This is generally not so in conciliation. We consider that these observations are equally applicable under the present legislation. 39 However, it should be noted that, in Kelly v Foley, the Commission considered that there should be an exception to the general principle where the material relied upon was relevant to an application for costs under s 252 of the 1991 statute. That provision is in relevantly indistinguishable terms to s 181(2)(a) and (c) of the present Act. We would agree with the observations of Walton J, Vice-President in Van Huisstede v Commissioner of Police (No.2) (2001) 106 IR 56 at 64 that the exception is available in applications for costs under s 181 of the present legislation. 40 The Full Commission in Kelly v Foley concluded that the appeal should be dismissed, observing at 334: In this case we take the view that the Commissioner fell into error in the regard which he had to what transpired in conciliation, but not in such a way as to lead him to the wrong conclusion on the substantial merits of the case. This largely resulted from the circumstance that the facts relevant to a determination of the question of whether or not the dismissal was harsh, unreasonable or unjust, were for the most part not in dispute. 41 In this case, the commissioner plainly relied on matters disclosed in conciliation proceedings for the purposes of assessing the credit of Mr Raw. We consider that he thereby erred. The effect of this error will, however, consistent with the approach in Kelly v Foley, ultimately turn on whether the consideration of that material was such as to require appellate intervention, or the extent to which such intervention may be necessary. This will be considered in more detail subsequently. 42 The appellant's alternative contention was that the commissioner relied on a perceived inconsistency between the material disclosed in conciliation and that given in evidence to form a view adverse to the appellant's witness without having provided the opportunity for him to respond. It was conceded that the matter of the lease fee work issue was put to Mr Raw in cross-examination, however, the perceived inconsistency was not directly put to him. In this way, it was contended, the appellant was denied procedural fairness by the breaching of the rule in Browne v Dunn. 43 It is well settled that the Commission is obliged to observe the requirements of procedural fairness in proceedings before it. As the Full Bench recently observed in CGEA Transport Ltd t/as Southtrans v Transport Workers' Union of Australia (2001) 110 IR 211 at [35] - [37]: [35] The precise requirements of procedural fairness will depend on the entire circumstances of the case and the statutory context in which the decision-maker is operating. It is clear, however, that a party to proceedings is entitled to know that case which they are required to answer. In Kioa v West (1985) 159 CLR 550 at 582, for example, Mason J said: It is a fundamental rule of the common law doctrine of natural justice expressed in traditional terms that, generally speaking, when an order is to be made which will deprive a person of some right or interest or the legitimate expectation of a benefit, he is entitled to know the case sought to be made against him and to be given an opportunity of replying to it. [36] Fairness requires that each party be given the opportunity to meet the case which is put against him or her. In adversarial proceedings, this ordinarily means that the decision maker is precluded from addressing issues not raised by the charges or pleadings and the submissions of the parties at hearing: see Fletcher v Federal Commissioner of Taxation (1988) 84 ALR 295 at 307-310. A decision maker may also be required to identify critical issues which it is proposed to decide against a party, at least where those conclusions are not obvious or anticipated. [37] The approach to procedural fairness in the context of adversarial proceedings may be illustrated by reference to the decision of Beazley J in Marelic v Comcare (1993) 47 FCR 437. In that case, it was alleged that the applicant had been denied procedural fairness in proceedings before the Administrative Appeals Tribunal on the ground that the tribunal had determined the case on the basis of matters that were not raised with the applicant at the hearing. Relevantly, the tribunal had determined that the applicant had feigned or exaggerated her symptoms. Her Honour stated (at 442): The rule in Browne v Dunn is a procedural rule grounded in fairness, and its application must depend upon the circumstances of each case. In Trade Practices Commission v Mobil Oil Australia Limited (1984) 3 FCR 168 Toohey J held (at 181) that in circumstances where the respondent's legal advisers were fully alerted before and during the hearing to the allegations made against the company and the evidence upon which the Commission relied, it was unnecessary to consider the operation of the rule in Browne v Dunn . A similar approach was adopted by Spender J in Dolan v Australian and Overseas Telecommunications Corporation (1993) 42 FCR 206 where his Honour held (at 236) that in the circumstances of that case, the failure to put the contents of a video to the medical witnesses produced no unfairness to the applicant. It is not necessary to determine whether the rule, as such, applies to proceedings before the Tribunal. Indeed I consider that to be the wrong question to determine. The Tribunal is bound to observe the rules of procedural fairness and in that regard, the rule in Browne v Dunn , with the qualifications to which I have referred, is a convenient statement of the content of that aspect of procedural fairness which requires that a party be given adequate opportunity to meet the case which is put against her or him. [38] Her Honour found that the applicant had been denied procedural fairness in relation to the question of whether she had been feigning or exaggerating her symptoms. This allegation, which the tribunal found to be substantiated, had not been put to the applicant in cross-examination and counsel for the respondent had expressly disavowed that any such allegation was being made. 44 In Government Insurance Office of New South Wales v Bailey (1992) 27 NSWLR 304, the Court of Appeal upheld an appeal from an alleged denial of natural justice in proceedings to determine damages for personal injury. The denial was held to have arisen from findings made by the trial judge based on observations which the judge had made of the plaintiff sitting in the back of the court room during the hearing. The observations had not been raised with the parties to the proceedings prior to judgment being given. 45 Kirby P acknowledged that it is a fundamental part of a fair trial that "the case will only be determined, and the controversy resolved, by reference to lawful evidence given orally or in written or like form" and continued, at 310: It is for this reason that judges conventionally warn juries (as they should themselves) to put out of consideration information relevant to the controversy acquired beyond the courtroom, although as Young J remarked in his most helpful essay "Observation by Trial Judges Outside Court" (1989) 5 Aust Bar Rev 199, juries are also often told that they must not "leave their commonsense behind when they enter the jury box". Such commonsense is limited to matters of common knowledge which are unlikely to be in dispute between the parties. Matters central to their dispute, and thus relevant to resolving their controversy, must be disclosed. There are many reasons for this rule. First, knowledge of matters actually in controversy may require a judicial officer or a juror to be disqualified. Secondly, evidence is normally received on oath or following an affirmation that it will be truthful. Thirdly, the public trial of matters in dispute entitles the public to have disclosure, during the trial, of the matters upon which the decision-maker will rely so that the decision may be tested against such matters. So much is inherent in our system of open justice. Fourthly, due process of law entitles a party to test, answer and make submissions upon all of the evidence which may affect the decision-maker. These facilities are denied to the extent that such evidence is not disclosed openly during the trial. 46 His Honour considered that such an obligation did not require disclosure of any or all observations, and concluded : Nevertheless, a long line of authority in this Court, approved by the High Court of Australia and decisions in other Australian appellate courts demonstrate a stringent rule. If material is used to determine a case which is outside the legal evidence, beyond the permissible exceptions and is not disclosed to the parties, an irregularity will have occurred which may amount to a breach of the requirement of procedural fairness and necessitate the setting aside of the judgment challenged. (at 311) 47 Similar observations were made by Clarke JA (with whom Hope AJA agreed) at 323: There is no doubt that the general rule is that a judicial decision should be based upon evidence given during the trial and that a judge is not entitled to have recourse to personal knowledge relating to facts in issue gained otherwise than from the evidence adduced before him or her. For instance a judge should not, without the knowledge of the parties, have a view of the scene of an accident, take some measurements at the site and then rely on what he had observed in forming his judgment: Coldwell v Municipal Tramways Trust [1928] SASR 234. There are, of course, some exceptions (for example, matters which may be the subject of judicial knowledge) but they are not relevant here. … The rule which should be applied in these circumstances is a flexible one based upon considerations of fairness and justice. It was stated in Minagall v Ayres [1966] SASR 151 and further clarified by King CJ in Angaston and District Hospital v Thamm (1987) 47 SASR 177. King CJ said (at 178-179): "The principle of law which was expressed in Minagall v Ayres and which was accepted by the judges who constituted the Court in Jobst v Inglis , is expressed in a passage in the judgment of Napier CJ, with whom Travers J agreed, at 156 of the report. It is as follows: 'But, while we agree with Hogarth J, we desire to guard ourselves against being understood as laying down any absolute rule upon the subject. It seems to us that it is a matter of what we should regard as "fair play and common sense". The condition upon which a judge is at liberty to take notice of what he has seen for himself is that the parties should know or be informed of what he has noticed, and have an opportunity of answering or dealing with it.'" 48 Government Insurance Office of New South Wales v Bailey was relied on in Kassem v Crossley. The Court of Appeal there dealt with an appeal in which it was alleged that the appellant had been denied procedural fairness as to adverse findings of credit against the appellant, founded upon observations made by the trial judge when the appellant was in the courtroom. Counsel for the respondent in final address at trial had invited the judge to have regard to the appellant's behaviour in court (for example, the appellant's capacity to move about in court as compared to his capacity for movement as deposed to in his evidence, or as recorded in medical histories). Whilst counsel for the appellant had urged the judge against such reliance, the trial judge had not indicated that the observations might or would be taken into account. The appellant contended on appeal that, in the absence of some intimation from the trial judge, he was entitled to conclude that the matter had been dropped and would not be taken further. It was contended that there was no reason to expect that any weight would be placed upon what occurred in court during the trial. That is, although it was open for the judge to have regard to the relevant observations, prior to doing so, it was necessary for her Honour to bring the reliance to the appellant's attention. The respondent had contended that as the matters were raised in final submissions the trial had progressed to such a stage that it was too late for the appellant to have done anything in response. 49 The respondent's contentions were rejected. It was held that although leave would have been necessary to reopen the appellant's case, it would have been inconceivable that leave would not have been granted, if sought. The Court agreed with the submission that the principle in Government Insurance Office v Bailey had not been observed and the appeal was allowed. 50 It is apparent in the proceedings before Cambridge C, that the perceived inconsistency arising from statements made during conciliation proceedings was not raised with the appellant so as to permit an opportunity to deal with it. The issue of the appellant having given consent to the performance of the lease work free of charge was plainly in contest between the parties. Although Mr Raw, the appellant's witness, was cross-examined on the issue, the inconsistency in the evidence arising from conciliation was not raised with, or put to, him by the commissioner. 51 Whilst the Commission may inform itself on any matter before it in any manner it thinks just (see for example s 163(1)), and in so doing is not bound by the rules of evidence, the Commission must act according to "equity, good conscience and the substantial merits of the case". It was not open to the commissioner to take into account the perceived inconsistency arising from the conciliation proceedings without having put the parties on notice and allowing them an opportunity to deal with the matter. The Commission's obligation is to ensure that procedural fairness is accorded to the parties in the conduct of proceedings before it. It required the commissioner to put to the appellant his observations as to matters outside of the "legal evidence" which were said to ground an inconsistency so as to permit the appellant to respond to such matters. We note that this conclusion does not depend on the rule in Browne v Dunn which we consider is not applicable in the determination of this matter. 52 The Full Commission in Employers' Federation of New South Wales v Greco (1993) 51 IR 451 at 455 held: The rules of evidence do not of course bind the Commission, yet it is obliged to act according to "equity and good conscience". Part of this obligation requires ensuring that witnesses are treated fairly, particularly if it is to be suggested to the Commission that the witness is lying or ought for some other reason to be disbelieved. It does not follow, however, that a breach of procedural fairness, regardless of the actual circumstances or the actual effect of it on the result of proceedings, will invariably result in the original decision being set aside and a new trial ordered. As was said in CGEA Transport Ltd t/as Southtrans v Transport Workers' Union of Australia at [41] - [46] as follows: [41] However, where there has been a breach of the requirements of procedural fairness, it may be necessary to examine closely the consequences of the failure or breach. A party is undoubtedly entitled to a fair hearing. However, that entitlement does not lead to the conclusion that every infringement will necessarily require that the decision be quashed or a new hearing ordered. In Stead v State Government Insurance Commission (1986) 161 CLR 141, for example, the High Court observed that an appellate court will not order a new trial if it would inevitably result in the making of the same order as that made by the primary judge at the first trial. The court continued (at 145): "For this reason not every departure from the rules of natural justice at a trial will entitle the aggrieved party to a new trial. By way of illustration, if all that happened at a trial was that a party was denied the opportunity of making submission on a question of law, when, in the opinion of the appellate court, the question of law must clearly be answered unfavourably to the aggrieved party, it would be futile to order a new trial." [42] The example given by the High Court in Stead of a circumstance where a new trial would not be ordered because of futility may be thought to be a rather particular or rare situation. It does not, however, follow that a breach of procedural fairness, regardless of its actual circumstances or actual effect on the result of the initial proceedings, will in other circumstances invariably result in the original decision being set aside and a new hearing. [43] For example, the Court of Appeal in Parkes Rural Distributions Pty Ltd v Glasson (1986) 7 NSWLR 332 at 337 - 338 rejected an argument that a breach of the duty to accord natural justice (now more usually referred to as procedural fairness) rendered an exercise of power ultra vires and held that the consequences of a breach depends on its nature and substance, rather than its form. Glass JA (with whom Samuels and Priestley JJA agreed) said: "It seems to me that the proposition is inconsistent with the statement of Lord Wilberforce in Malloch [ v Aberdeen Corporation [1971] 1 WLR 1578; [1971] 2 All ER 1278] previously referred to viz (at 1595; 1294): '... A breach of procedure, whether called a failure of natural justice, or an essential administrative fault, cannot give him a remedy in the courts, unless behind it there is something of substance which has been lost by failure.' If the breach of duty is of no consequence when no prejudice ensures, the performance of the duty cannot be an a priori condition upon which the validity of the exercise of power depends. It is a source of potential invalidity only depending upon the circumstances of the breach. The submission also runs counter to the doctrine that the act is valid until successfully challenged and the subrules that a denial of natural justice will not affect validity where there has been waiver: R v Williams; Ex parte Phillips [1914] 1 KB 608, or no prejudice, Malloch . Notwithstanding the denial, the exercise of power is not ultra vires as in the case of jurisdictional error or exercise of power for a purpose extraneous to the scope of the grant: R v Toohey; Ex parte Northern Land Council (1981) 151 CLR 170." [44] Similarly, in Marelic v Comcare , Beazley J observed (at 442) in relation to an infraction of the rule in Browne v Dunn : "The mere fact that the rule in Browne v Dunn has been violated does not mean, necessarily, that there should be a new trial. Whether or not there should be a new trial depends upon the nature of the infraction, the remedy being within the discretion of the trial judge: see Seymour's case, per Glass JA, with whom Reynolds JA agreed; and Payless Superbarn (NSW) Pty. Limited v O'Gara per Clarke JA (at 556)." [45] Care must also be exercised in considering cases where superior courts have, with the support of academic writers, declined to refuse prerogative or similar relief for "trivial" breaches. For example, where a breach of the hearing rule was such that it was said "its observance would have made no difference to the final result": Aronson and Dyer Judicial Review of Administrative Action Law Book Company Limited, 1996 at pp 486ff. The primary basis, as Aronson and Dyer observe, for the courts approaching the matter in this way is that, in judicial review proceedings, courts are not concerned, as we are in these proceedings, with the merits or correctness of the decision under review. See, for example, Village Roadshow Corporation Ltd v Sheehan (1987) 75 ALR 539 at 553 where Einfeld J, in declining to refuse relief said: The respondent's argument that all the court's intervention can achieve is the reconsideration of the decision by the whole Review Board, seems to miss the point that that is what judicial review is about. [46] In these proceedings it is therefore necessary to assess whether the findings made in denial of procedural fairness played a significant part in the decision under review. In Totalisator Agency Board of New South Wales v Casey (1994) 54 IR 354, for example, the Court of Appeal considered an appeal from a decision of the Government and Related Employees' Tribunal ordering that the dismissal of an employee be set aside. The tribunal determined that the dismissal was too harsh in the circumstances of the case. In the course of its decision, however, the tribunal had made comments critical of the management of the employer in that it had been deficient in failing to detect the non-observance of the budgetary constraints which were claimed by the employer to justify the dismissal. The employer claimed that it had been denied the opportunity to make submissions in relation to these matters. The majority ( Priestley and Meagher JJA) dismissed the appeal on the grounds that the comments did not play a material role in the tribunal's decision. Priestley JA stated (at 365): I do not think the idea embodied in the remarks played any material part in the Tribunal's decision. They were in my opinion in the nature of reflections on what the position in the case would have been if one aspect of the Totalisator Agency Board's organisation were managed in a particular way. To make such incidental reflections in the process of deciding the case on the basis of what actually happened could not, in the circumstances of the case, amount to such a denial of procedural fairness on any aspect of the case which had any bearing on the Tribunal's decision. It is perhaps possible to imagine a case where some extraneous remark by a tribunal, although not relevant to any issue before the tribunal, so clearly showed prejudice or misunderstanding likely to affect the tribunal's decision, that it could be attacked on the ground (among others) that if the party affected had not had a chance to deal with the subject matter of the remark, the decision must be set aside on the ground of denial of procedural fairness. I do not think the facts in the present appeal are of that kind. 53 A convenient statement of the appropriate general approach is that set out in the judgment of the High Court in Stead v State Government Insurance Commission (1986) 161 CLR 141, where the Court, having referred to the "general principle … well expressed by the English Court of Appeal" in Jones v National Coal Board [1957] 2 QB 55 at 67 that "everyone … is entitled [to] a fair trial at which he can put his case properly", observed at 145 - 146: That general principle is, however, subject to an important qualification which Bollen J plainly had in mind in identifying the practical question as being: Would further information possibly have made any difference? That qualification is that an appellate court will not order a new trial if it would inevitably result in the making of the same order as that made by the primary judge at the first trial. An order for a new trial in such a case would be a futility. For this reason not every departure from the rules of natural justice at a trial will entitle the aggrieved party to a new trial. … Where, however, the denial of natural justice affects the entitlement of a party to make submissions on an issue of fact, especially when the issue is whether the evidence of a particular witness should be accepted, it is more difficult for a court of appeal to conclude that compliance with the requirements of natural justice could have made no difference. True it is that an appeal to the Full Court from a judgment or order of a judge is by way of rehearing and that on hearing such an appeal the Full Court has all the powers and duties of the primary judge, including the power to draw inferences of fact (Supreme Court Rules O.58 rr.6 and 14). However, when the Full Court is invited by a respondent to exercise these powers in order to arrive at a conclusion that a new trial, sought to remedy a denial of natural justice relevant to a finding of fact, could make no difference to the result already reached, it should proceed with caution. It is no easy task for a court of appeal to satisfy itself that what appears on its face to have been a denial of natural justice could have had no bearing on the outcome of the trial of an issue of fact. And this difficulty is magnified when the issue concerns the acceptance or rejection of the testimony of a witness at the trial. (emphasis added) 54 We consider that the denial of procedural fairness in this matter warrants appellant intervention. It is plain that the error affected the decision at first instance. It is also clear that the removal of that procedural unfairness would affect the result at first instance. It is, therefore, necessary to consider the effect the errors had on the disposition of the matter below and the way in which the matter should be dealt with on appeal: see, for example, Price v Box Valley Pty Ltd (1999) 90 IR 480 at 485. 55 Despite the findings made in favour of the appellant's submissions, we do not, however, consider that it is appropriate to set aside the decision in whole and to remit the matter for redetermination. Rather, we consider that the commissioner's finding that the dismissal was harsh, unreasonable or unjust is still available, albeit on a somewhat different basis. Having established appellable error warranting intervention, the general principle is that an appellate tribunal may be in as good a position as the trier of fact to decide the proper inference to be drawn from facts which are undisputed or which, having been disputed, are established by the findings made. In deciding what inferences are to be drawn, the appeal body will give due weight to the conclusions at first instance, and, having reached its own conclusion, should not shrink from giving effect to it: for example, Burge at 327 - 328 in [7] and cf Warren v Coombes (1978) 142 CLR 531 at 551. 56 Having regard to the above findings of error, the situation which arises, is as follows. The claim by the respondent, successful at first instance, alleged that her dismissal was harsh, unreasonable or unjust on the basis of both procedural and substantive grounds. The appellant, at first instance, conceded (appropriately in our view) that the dismissal of the respondent occurred in a manner which denied her procedural fairness. The appellant resisted the claim by submitting that any procedural unfairness would be overcome by considerations of the dismissal having been warranted on the basis of alleged misconduct. The misconduct alleged was essentially the issues earlier identified as to the lease fee work issue and that relating to payslips. At first instance Cambridge C found that the appellant had not been guilty of misconduct as to either matter. The finding in respect of the second issue has not been challenged on appeal. 57 The appellant submits that the finding as to the lease fee work issue was plainly the most significant matter relied upon by the commissioner in making the finding that the dismissal was substantively unfair. The finding against the credit of Mr Raw, made as the result of error, was the basis of the commissioner's rejection of the alleged misconduct. The finding against credit was an important part of the consideration, which led to the rejection of the most significant misconduct allegation. The finding of unfair dismissal is therefore affected accordingly. 58 However, the appellant conceded both at first instance and again on appeal that the dismissal of the respondent was procedurally unfair. Indeed, on appeal counsel for the appellant, quite properly in our view, conceded that it was open for the Full Bench to find that the dismissal was harsh, unreasonable or unjust on the basis of procedural unfairness alone, although he strongly urged the Full Bench not to adopt that course. 59 That the adoption of an unfair process when making a decision to dismiss an employee may be the foundation for a finding of harsh, unreasonable or unjust is plain: see, for example, Antonakopoulos v State Bank of New South Wales (1999) 91 IR 385 and Wilson v Department of Education and Training. In our view, in the circumstances of this case, the failure to provide the respondent with an opportunity to respond to the allegations levelled against her was enough to warrant the dismissal being considered unreasonable and unjust. 60 Further, when regard is had to the circumstances surrounding the lease fee issue (that is, that the appellant was aware the lease work was to be performed, that the appellant condoned the circumstance of performing the work at a reduced rate and that the appellant was prepared to offer a reduced rate on the basis of receiving further work from the client), the dismissal of the respondent was so severe a penalty as to warrant a finding that the dismissal was harsh: see, for example, Metropolitan Meat Industry Board v Australasian Meat Industry Employees' Union, New South Wales Branch [1973] AR (NSW) 231; and particularly so, when considered with the situation where Cambridge C's finding as to the other aspect of alleged misconduct was not challenged on appeal. We consider that it is not only available to deal with the matter in this way but that it is appropriate to do so in the exercise of our discretion having regard to the circumstances of the matter, including the way the appeal was conducted and the undesirability, in the public interest, of having, in effect, a third proceeding as to a s 84 application, when it is avoidable in the context of a final determination that fairly adjusts the respective interests of the parties: cf Price v Box Valley (at 485). 61 This does not, however, finally dispose of the matter on appeal. The appellant has contended that the commissioner fell into further error by ordering the respondent to pay 23 weeks of the respondent's full wage in lieu of reinstatement. The error was said to be that in doing so the commissioner had ignored the evidence of Mrs Flood, tested under cross-examination, in relation to her subsequently obtaining work and the remuneration received in that alternative work. Mr Knoll submitted that the commissioner preferred statements made at the heel of the hunt in closing submissions by the respondent's representative, which clearly were not made out on the evidence in the proceedings. Counsel submitted that the commissioner, despite having heard the appellant's objection as to the new material, and having recognised then that it arose in the submissions went on to make a money order based on those submissions notwithstanding having expressly stated in his decision that he had not considered the matters of new evidence raised in closing submissions,. In doing so, it was submitted, the appellant was not afforded the opportunity to bring evidence in response to, or deal with, those submissions. In taking that course, the commissioner had again denied the appellant procedural fairness. 62 Further, the appellant contended that the commissioner had committed further error, when making money orders, in not complying with the requirements of s 89(6) of the statute. 63 Section 89 provides that where reinstatement is considered impracticable the Commission may order the payment of compensation "not exceeding the amount of remuneration of the applicant during the period of 6 months immediately before being dismissed". Section 89(6) provides for matters which the Commission "is to take into account" when determining the amount of compensation. The provision is expressed in mandatory language and requires there be taken into account in assessing compensation "whether the applicant made a reasonable attempt to find alternative employment and the remuneration received in alternative employment, or that would have been payable if the applicant had succeeded in obtaining alternative employment". 64 The power in the Commission to make a money order, subject to the limitation on the quantum of compensation and the matters required to be taken into account by s 89(6), is nevertheless within the Commission's discretion. Whilst the Commission is required to take into consideration the matters identified in s 89(6), those matters are not necessarily to be reflected in any particular, arithmetic or definitive way in the money order for compensation made. We would thus accept the submissions of the respondent to the extent that it was contended that the way in which, and the extent to which, those matters are in fact taken into account is ultimately a matter of discretion in the circumstances of the instant case. See, for example, the decision of the Full Bench in Sunny Queen Limited t/as Australian Quality Egg Farms v Reilly [2000] NSWIRComm 1128. 65 However, in the present circumstances, we accept the appellant's submission that it was not appropriate in the circumstances to make an order requiring the payment of 23 weeks remuneration. The respondent was dismissed from her position as a property consultant on 30 June 2000. The respondent's evidence at first instance was that she had obtained employment on 24 August 2000, some seven weeks after her dismissal by the appellant, with another real estate agent as a property manager. That employment was at a rate approximately $85 per week less than the rate she was receiving with the appellant. Due to the location of that agency the respondent sought other employment closer to home. The position she was then able to obtain, some two months later in November 2000, was with yet another real estate agency as a receptionist. Her remuneration in this position was again some $85 per week less than that received through her employment with the appellant. The respondent continued in that employment. 66 The commissioner's order was premised on a finding that the respondent "would have likely enjoyed many years further employment with the employer". This finding has not been challenged on the appeal and we consider it was open and thus an appropriate basis on which to found our orders. Indeed, having assumed that it failed on its primary submissions and that the finding of harsh, unreasonable or unjust was not disturbed by the Full Bench, the appellant conceded that the respondent ought be entitled to payment in an amount of $6,163. That figure approximates an amount that would have been received during the respondent's initial period of unemployment, had she remained employed with the appellant, and an amount equivalent to the difference between the remuneration received in her new employment and that received whilst employed by the appellant, for the period of six months following the dismissal. Section 89(5) does not, however, limit the compensation which may be awarded to the six month period after the employment is terminated. The provision limits the amount of money that may be ordered to a maximum sum calculated by reference to the payment "not exceeding the [respondent's] remuneration during the period of 6 months immediately before being dismissed". 67 We consider that in view of the unchallenged findings referred to, particularly those in relation to the likely longevity of the respondent's employment with the appellant and the respondent's continuing loss of earnings, the amount of $9,000 should be substituted for that awarded by Cambridge C. 68 The Full Bench makes the following orders: 1. Leave to appeal is granted 2. The appeal is upheld to the extent identified in this decision; 3. The orders of Cambridge C made on 11 April 2001 varied so as to require the appellant to pay to the respondent an amount of $9,000 within 14 days of this decision. 4. The stay of the orders made on 17 May 2001 is varied to the extent necessary for that payment to be made. So that, for example, the money held in the appellant's solicitors trust account is to be paid to the respondent within 14 days of this decision. 5. Liberty to apply otherwise in respect of the stay, to the extent necessary, provided that such leave is exercised within 21 days. ________________ DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.