Norman Waterhouse
Norman Waterhouse



Normans Briefly

In this issue

Welcome to the June edition of our Corporate and Commercial Briefly.

>   Welcome back Amanda Green!
>   Employment – Early 'bullying' decision examines the nature of 'reasonable management action'
>   Estate Planning – A Previously Unforeseen Consequence of Intestacy
>   Property, Infrastructure & Development – Rights of way Part 1 - What are they and how may they be created?

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Welcome back Amanda Green!

We are happy to announce Amanda Green, Senior Associate in the Employment and Industrial Relations Team, will be returning from Maternity Leave in early July.

Amanda can be contacted for assistance and advice  in relation to all your human resource and workplace issues on (08) 8217 1306 or

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Employment – Early 'bullying' decision examines the nature of 'reasonable management action'

Last month’s decision of the Fair Work Commission (FWC) in Ms SB [2014] FWC 2104 was the first substantive, contested decision of the new bullying jurisdiction of the FWC (which applies to all private sector employers and, as we have discussed previously, may apply to many local government councils unless a change in the law occurs).

The decision relates to the unusual situation of subordinate employees allegedly bullying a manager. The decision also contains informative examination of some key concepts, including the term ‘reasonable management action’.

The facts

An employer received a complaint made by a subordinate employee against a manager (names of parties were suppressed by the FWC). The employer investigated the complaint through the engagement of an external investigator (a law firm), and the complaint was found to be unsubstantiated.

A further, similar complaint was lodged later against the same manager, by a different subordinate employee. The manager brought proceedings in the bullying jurisdiction of the FWC, alleging various circumstances constituted ‘bullying’, including that:

  • The employer opted to receive and investigate the complaints against the manager,
  • After the first complaint was dismissed, the employer failed to prevent similar unfounded claims being lodged in the future; and
  • The Manager was the target of various malicious rumours and gossip and received  insufficient support from the employer.

Definition of ‘bullying’

In dealing with the application, the FWC looked at the definition of ‘bullying’ set out in Section 789FD(1) of the Fair Work Act 2009 (Cth) (FW Act). That definition provides that a person is bullied if an individual or group of individuals:

‘repeatedly behaves unreasonably towards the worker, or a group of workers of which the worker is a member, and that behaviour creates a risk to health and safety’

The FWC examined all elements of this definition. The FWC determined that it is not necessarily the same behaviour that must be repeated; the term may apply to a range of behaviours over time (but there must be at least more than one incident). Additionally, the FWC held that whether conduct is ‘unreasonable’ is a matter to be determined on a case-by case basis, taking into account all relevant circumstances. Regarding the ‘risk to health and safety’, the FWC found that only a possibility of danger needs to demonstrated, not an actual danger.

However, perhaps the most important discussion was made in relation to the ‘reasonable management action’ provision in Section 789FD(2) of the FW Act, which states that the term ‘bullying’:

‘does not apply to reasonable management action carried out in a reasonable manner’.

Reasonable management action

The FWC importantly recognised that, when viewing management practices, it will always have the benefit of hindsight. Accordingly, the FWC held that ‘reasonable’ does not necessarily mean ‘perfect’ or ‘ideal’. Rather, the FWC will consider the actual actions or omissions (not simply the applicant’s perception of them) and determine whether they were reasonable in the circumstances that existed at the relevant time and in light of the knowledge of those parties involved.

The simple fact that a process could have been undertaken in a matter that was ‘more reasonable’ will not render a process as overall ‘unreasonable’. However, the FWC noted that any significant departures by an employer from established policies and procedures will tend to indicate unreasonableness (unless there was a valid reason for the departure).

The FWC ultimately dismissed the manager’s application, finding that there was no ‘bullying’ behaviour towards the manager. The FWC further noted that the employer’s actions of receiving and investigating complaints by employees against the manager were reasonable and prudent. The FWC also found no failings regarding the level of support offered to the manager. The manager was in fact offered support, which the manager opted not to accept.

Implications for employers

As previously stated, the bullying jurisdiction of the FWC applies to all private sector employers and possibly many local government councils as well. Moreover, it is important to note that bullying is a risk to health and safety under the Work Health and Safety Act 2012 (SA), which applies to all employers in South Australia.

It is no coincidence that the definition of bullying in Safe Work Australia’s Guide for Preventing and Responding to Workplace Bullying uses a virtually identical definition of bullying to the FW Act (including an exemption for ‘reasonable management action’). Accordingly, it is likely that the FWC’s reasoning in its bullying jurisdiction will be taken into account in prosecutions for alleged bullying-related contraventions of workplace safety legislation.

While the FWC has stated that procedures for dealing with bullying need not be ‘perfect’ to be considered ‘reasonable management action’, it is of course necessary to have some kind of policy and procedural framework in place. Without such a framework being developed, implemented and effectively communicated to all employees, an employer will find it difficult to argue that its method of dealing with potential bullying is reasonable.

As a minimum, policies, procedures and management practices relating to bullying will need to be transparent and supportive of the involved parties, and must adhere to procedural fairness requirements. Policies and procedures should be followed closely in light of the FWC’s stance that deviations from policies and procedures will be taken into account when determining whether management action is ‘reasonable’.

For more specific information on any of the material contained in this article please contact Sathish Dasan on 08 8210 1253 or

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Estate Planning – A Previously Unforeseen Consequence of Intestacy

The Supreme Court of Queensland has recently had reason to consider a situation where an administrator of an estate sought to have superannuation death benefits paid out directly to her and not to the estate of her son, who had died intestate (without a Will).  In somewhat of a surprise, the Court found that the administrator had a fiduciary duty to maximise the assets of the estate and consequently was not able to benefit from an application by her to three separate superannuation funds for them to exercise their discretion to make payment of the death benefits directly to her, notwithstanding an apparently genuine inter-dependent relationship with her son and the relative estrangement of his father, her ex-husband.

The case of McIntosh v McIntosh [2014] QSC 99 (found here) was somewhat of a surprising decision and has consequences for a variety of participants in the estate planning area.  Included among these are superannuation trustees, including trustees of self-managed superannuation funds and administrators of intestate estates.

The particular facts of the case mean that we would hope very few of our clients are in a situation similar to that of the administrator or, for that matter, the deceased.  This is because the deceased died intestate and without binding death nominations in relation to his superannuation death benefits being in place.

If either of these relatively straight forward matters had been addressed prior to his death, his mother would likely have been able to make the applications that she did make in good faith and without her breaching her duty to the estate and the beneficiaries of the estate.  As it happens though, she was found to be in breach of her fiduciary obligations to the estate and the beneficiaries in making those applications and consequently was required to repay the full proceeds into the estate where they were then divided between her and her estranged husband, the deceased’s father, in accordance with the rules of intestacy.

Although there was certainly no finding of any form of impropriety on the part of the trustees of the superannuation fund, the case does raise questions about the management of self managed superannuation funds in these circumstances.  Trustees of self managed superannuation funds may wish to conduct further investigations in relation to applications which are made in relation to the death benefits of members who have died intestate and consequently have an administrator appointed to manage their affairs. We would hope that clients who have established a self managed superannuation fund would also have appropriate binding death nominations and wills in place, which would mitigate the risks highlighted by this case.

The case highlights the importance of both having a will and ensuring that binding death nominations are in place in relation to your superannuation funds.  Not having your affairs in order can mean that your assets do not pass to your anticipated beneficiaries in the way that you may otherwise wish and the beneficiaries may need to engage in costly litigation to sought through issues which arise as a result.

For more information on any of the issues contained in this briefly or to discuss your personal situation and estate planning needs, please contact Mark Henderson on 08 8210 1220 or

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Property, Infrastructure & Development – Rights of way Part 1 - What are they and how may they be created?

One of the most common forms of easement granted over land is a right of way.

An easement is a non-exclusive right enjoyed by one person (the Easement Holder) over the land of another person (the Landowner). More specifically, a right of way is a particular type of easement that gives the Easement Holder a right to pass over the Landowner’s property. A right of way therefore also restricts the Landowner’s use of its land to some extent.

There are several avenues for the creation of a registered right of way.

First, a Landowner may expressly grant the right to the Easement Holder. The creation of a right of way by grant can be made by lodging a Grant of Easement executed by both the Easement Holder and the Landowner with the Lands Titles Office. A plan will also need to have been filed with, and approved by, the Registrar-General if the right of way is only for a portion of the land (which is most often the case).

Secondly, a right of way may be created as part of a division of land (refer to section 90 of the Real Property Act 1886).  

Thirdly, the Easement Holder may transfer the land to the Landowner and reserve to itself a right of way over the land so transferred. The right of way could be reserved as appurtenant to any other land of the Easement Holder (e.g. adjoining land that requires ongoing access).

Once registered, the right of way will attach to, and pass with, the land. This means that any subsequent purchasers of the Landowner’s property will continue to hold the land subject to the right of way. The right of way may then only be varied or removed if both parties agree to such variation or removal and lodge the relevant instrument with the Lands Titles Office. This makes a right of way a particularly useful and generally permanent method of legally passing through another’s land.

When creating a right of way, the scope of the right being granted should be expressly described. This will help to avoid any uncertainty and hopefully, any future disagreements between the Easement Holder and the Landowner. In South Australia, the conferral of “a free and unrestricted right of way” is deemed to imply the long form right of way set out in Schedule 5 of the Real Property Act 1886. Although different or additional rights may be granted, this is a simple way of granting to the Easement Holder a full and free right and liberty to pass and repass over the relevant land for all purposes with either vehicular or pedestrian traffic.

Once a right of way has been registered, many parties then encounter questions regarding the rights and obligations that exist for each party, such as who is responsible for the maintenance and repair of the right of way and what happens if a right of way is interfered with? This will be discussed in further detail in part two of this article in next month’s Briefly.

For more specific information on any of the material contained in this article please contact Yari McCall on 08 8210 1265 or

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