District Court of Queensland

DISTRICT COURT OF QUEENSLAND

CITATION: Connolly v Queensland Rugby Union Ltd [2017] QDC 221 PARTIES: JOHN CONNOLLY (plaintiff) v QUEENSLAND RUGBY UNION LTD (defendant) FILE NO/S: 3905/15 DIVISION: Civil PROCEEDING: Trial ORIGINATING COURT: District Court at Brisbane DELIVERED ON: 1 September, 2017 DELIVERED AT: Brisbane HEARING DATE: 8-9 August, 2017 JUDGE: Dearden DCJ ORDER: 1. The defendant, Queensland Rugby Union Ltd, pay the plaintiff, John Connolly, the sum of $150,000. CATCHWORDS: CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – CONSTRUCTION AND INTERPRETATION OF CONTRACTS – IMPLIED TERMS – GENERALLY – where discussions were had by the defendant as to the term of the contract – where internal emails stated that the term being offered to the plaintiff was for the remainder of the 2015 and 2016 Super Rugby seasons – whether the term offered to the plaintiff was until the end of the 2015 Super Rugby season or the end of the 2016 Super Rugby season CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – FORMATION OF CONTRACTUAL RELATIONS – GENERAL OFFERS AND THEIR ACCEPTANCE – where there was an oral offer – where there was a written employment contract – where there was two written contractor agreements – whether the contract for the plaintiffs services was oral, written or both CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – DISCHARGE, BREACH AND DEFENCES TO ACTION FOR BREACH – REPUDIATION AND NON- PERFORMANCE – REPUDIATION – WHAT AMOUNTS

TO REPUDIATION – where the defendant told the plaintiff during a meeting that his services were terminated – where a termination letter was prepared by the defendant and given to the plaintiff – whether the defendant repudiated the contract with the plaintiff – whether the plaintiff suffered loss and damage as a consequence CASES: Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165

Brogden v Metropolitan Railway Co [1877] 2 App Cas 666

Weemah Park Pty Ltd v Glenlaton Investments Pty Ltd [2011] Qd R 582 COUNSEL: P Hackett for the plaintiff P Hastie QC for the defendant SOLICITORS: Carman Lawyers for the plaintiff McInnes Wilson Lawyers for the defendant

Introduction

[1] On 8 May, 2015 the Queensland Reds Rugby Union team played the Crusaders in Christchurch, New Zealand. After losing the match in a “fairly diabolical performance,”1 Rod McCall, Board Chairman of Queensland Rugby Union Ltd (QRU) and Jim Carmichael, Chief Executive Officer (CEO) of QRU, conferred in the hotel after the game2 and on the plane trip back to Australia,3 and decided to engage the services of John Connolly (the plaintiff) to “take some heat off the… team’s performance…[and] try and give it a new focus and try [to] reinvigorate the performance of the team.”4 Subsequently, Mr McCall spoke by telephone with Mr Connolly on 9 May 2015 and as a consequence, Mr Connolly attended at the premises of QRU on Monday 11 May 2015 to commence duties as a coaching consultant.

[2] Mr Connolly’s services were terminated by QRU on 27 July, 2015. Whether the contract for Mr Connolly’s services was oral or written or both; the terms of the contract (including payment and termination provisions, if any); and the consequences of Mr Connolly’s termination on 27 July 2015 are the issues in this litigation.

Dramatis personae

[3] John Connolly started coaching rugby union in 1980, and coached various teams including the Queensland Rugby Union team between October 1988 and 2000, before going on to coach teams in France, Wales and England, subsequently coaching the

1 T1-87. 2 T2-57. 3 T2-8. 4 T1-88.

Australian Wallabies team for two years from November 2005, before retiring in 2007.

[4] Sam Cordingley is the General Manager of Professional Rugby, QRU. In May 2015 he was the General Manager, High Performance, QRU. Mr Cordingley played professionally for the Queensland Reds Rugby Union team and the Swansea Rugby Union team in the United Kingdom.

[5] Rod McCall is a businessman who played rugby for Queensland and Australia, and has been involved in rugby administration at all levels of the game, including two Brisbane ruby clubs, Queensland Rugby Union and the Australian Rugby Union. He was a board member of the Queensland Rugby Union from September 2009 until February 2016, acting as Chairman of the Board for that period.5 He had a longstanding relationship with John Connolly, who was his coach when he played and captained the Queensland Rugby Union team.6

[6] Ashley Selwood was involved in the administration of rugby union for 22 years, at the Queensland Rugby Union, New South Wales Rugby Union and Australian Rugby Union. From September 2011 to September 2015, Mr Selwood was the Chief Financial Officer (CFO) for QRU.

[7] Joanne Newman is the Payroll Officer at the QRU and has held that position since February 2014.

[8] Jim Carmichael had been involved in a number of businesses as a Chief Executive Officer, had been involved in the organisation of the AFL, and was engaged by QRU as a CEO from 5 November 2009 to 13 May 2016.7

[9] Richard Graham was at the relevant time (May to August 2015) the Head Coach of the Queensland Reds.8 Mr Graham did not give evidence in the trial.

[10] Tom Kennedy was at the relevant time the Queensland Reds team media manager. Mr Kennedy did not give evidence in the trial.

[11] Phil Pope was at the relevant time the QRU media manager. Mr Pope did not give evidence in the trial.

Plaintiff’s evidence

John Connolly

[12] John Connolly gave evidence of his lengthy rugby union coaching career, commencing in 1980 when he coached the Brothers Rugby Union team, through to his appointment as the Queensland Rugby Union coach from October 1988 through

5 T1-86. 6 T1-87. 7 T2-56. 8 T1-89; Exhibit 1 p. 9.

to 2000, followed by coaching in France, England, Ireland and two years as the Australian Wallabies coach from November 2005. In retirement, he undertook rugby coaching consultancies in New Zealand, South Africa and Japan.9

[13] Mr Connolly was responsible for contracting Sam Cordingley to the Queensland Reds at the end of 1998, coached him for two or three years there, gave him a contract in Swansea, Wales, and remained a friend since then, meeting regularly and providing him advice in his role as the High Performance Manager of the QRU.10

[14] Mr Connolly started coaching Rod McCall as a 19-year-old at Brothers Rugby Union Club, and coached him through his whole rugby career until he retired in 1996. They had been in occasional contact since then.11

[15] Mr Connolly did not know Jim Carmichael, CEO of QRU in 2015, and, other than shaking hands once at a rugby match, only had contact with him when Mr Connolly flew to Melbourne for a meeting about “all things rugby” on 9 April 2015.12

[16] On Saturday 9 May 2015, Mr Connolly was shopping at Woolworths when he received a phone call from Rod McCall (then the Chairman of QRU). Mr Connolly recalls the conversation in these terms: “It was a very short conversation. He was a bit distressed about what happened the night before, Queensland lost a game in New Zealand, and he asked if I could – would go on board as a consultant, $3,000 a week. That was it. And to come to come to a meeting on Monday morning. I said ‘happy to be there.’ And it was – the conversation wouldn’t have gone for any more than 90 seconds, I wouldn’t think, two minutes. It was a very short conversation.”13

[17] During the conversation, the term of the appointment was offered by Mr McCall as “until the end of the next Super Rugby Season” (i.e. July 2016).14

[18] On the same day (9 May 2015 at 12:56 PM), after the phone call with Mr McCall Mr Connolly received an email from John Kennedy (Queensland Reds media manager) with a press release, which he considered unusual, although it didn’t worry him.15 Relevantly, the press release stated: “Former Reds and Wallabies coach, John Connolly, will join the St George Queensland Reds coaching staff as a consultant Monday, in advance of their home game against the rebels. He will be contracted to the Reds for the remainder of the 2015 Super Rugby season and for the 2016 Super Rugby season.”16

9 T1-20 – 1-21. 10 T1-21. 11 T1-21. 12 T1-22. 13 T1-23. 14 T1-23. 15 T1-24; Exhibit 1, p. 9. 16 Exhibit 1 p. 9.

[19] Mr Connolly attended at QRU headquarters for a meeting at the boardroom at 8.30am or 9.00am in the morning of Monday 11 May 2015. Mr Connolly recalls those present were Rod McCall, Sam Cordingley, Jim Carmichael and Richard Graham (Head Coach) who joined for awhile and left after 20 minutes. The meeting discussed the situation with the Queensland Reds, and at the end of the meeting Mr Connolly recalls the following exchange:- “I said, ‘I’ve just got to get something very clear here, that this contract is until the end of the next rugby season. I want you to know that I’ve got to buy a car to come down from the coast, and I do have to go to the World Cup.’ And Jim, on my left, said ‘yes, ho ho, we’re going to the World Cup as well. I’ll pay you for that. Sam can give you certain things to do while you’re over there in terms of looking at players and so forth.’ I said ‘fine.’ We all shook hands and we then, all of us, went down to a player’s meeting at 9.30am or 10.00am.”17

[20] Mr Connolly also gave evidence that he said in this conversation: “[I] reiterated the conversation I’d had to Rod, $3,000 a week til the end of the next rugby season, I had to buy a car and I’d be going to the World Cup. And they said ‘not a problem, we’ll pay you for that.’ And that was the only discussion at all in terms of contract, consultancies, whatever.”18

[21] Mr Connolly printed off an email from Sam Cordingley19 with “an employment contract” which he said was “nothing to what [he] agreed to” but “sillily (sic) [I] signed it and threw it on the back and sometime early in the week after delivered it back [seat of the car] to the Queensland Ruby Union.” Mr Connolly states that he wanted to give it to Jim [Carmichael, CEO] but was unable to get to see him, and in the end dropped it with Mr Carmichael’s secretary, then rang Ashley Selwood (CFO QRU) and said “listen, the contract I put back in is the wrong contract. We’ve agreed to a consultancy, not an employment contract.”20

[22] Exhibit 1 pp 71-74 is a copy of the QRU Employment Contract between Queensland Rugby Union Ltd and John Connolly, signed by Mr Connolly on 20 May 2015, but not signed by Jim Carmichael, Chief Executive Officer, Queensland Rugby Union Ltd, whose signature block appears immediately above the heading “Employee Acceptance.”

[23] Mr Connolly subsequently received an email dated 14 May, 2015 from Sam Cordingley21 a further document headed “QRU Contractor Agreement” which was signed by Mr Connolly in the presence of Dimity Pearson, personal assistant to the

17 T1-24. 18 T1-25. 19 Exhibit 1, pp. 15-20. 20 T1-25. 21 Exhibit 1 p. 15.

CEO, Jim Carmichael.22 The signature is undated. This agreement (“the first contractor agreement”) was not counter signed by Jim Carmichael CEO QRU.

[24] Mr Connolly gave evidence that after he signed the first contractor agreement he contacted Mr Selwood and said “you’ll have to get the whiteout out because that wasn’t what I agreed to [a reference to the termination provisions of this first contractor agreement]. Get Jim [a reference to Mr Carmichael] to initial it.”23

[25] Mr Connolly gave evidence that in mid-June, 2015, he had a conversation with Mr Selwood who said “Yes, that was incorrect. We’ll get another contract out to you.”24 This document, headed “QR Contractor Agreement” is the second contractor agreement.25 It was signed by Jim Carmichael (CEO QRU), although undated and without any witness signature, but was never signed by Mr Connolly.

[26] The second contractor agreement came to Mr Connolly as an attachment to an email from Mr Selwood on 9 July 2015. After receiving it, Mr Connolly rang Mr Selwood and said “Actually, this is all over the shop. This is not what I agreed to.”26 There were no further discussions after that date about the content of the contract.27

[27] After the completion of the 2015 Super Rugby Season, there was a review conducted on QRU by Damian Frawley and Brett Robinson for which Mr Connolly was one of the last persons interviewed.28

[28] Mr Connolly met with Mr Carmichael and Mr Cordingley on 22 July 2015 at Mr Carmichael’s office at Ballymore. Mr Carmichael told Mr Connolly “The review has recommended we terminate your employment here.” Mr Connolly said “Jim, what are you talking about? I’ve got a contract until the end of next year – an agreement til the end of next year.” Mr Carmichael replied “Yeah, but the review’s recommended we terminate it.” There was then further discussion about a possible alternative role for Mr Connolly at QRU. The meeting concluded with Mr Connolly saying “we had an agreement” and Mr Carmichael saying “well listen, I’ll have to check with Rod.”29

[29] There was a subsequent meeting on Monday 27 July with Mr Cordingley and Mr Carmichael. Mr Carmichael said “Yes, Rod did agree to that til the end of next season, but we’ve changed our mind.” Mr Carmichael went on to say “…we’re terminating it [the agreement].”30 Mr Connolly did not return to work at QRU after that day. Mr Connolly gave evidence that there was no discussion with Jim Carmichael about a notice period.

22 T2-62; Exhibit 1 pp. 75-80. 23 T1-27. 24 T1-27. 25 Exhibit 1, pp 81-87. 26 T1-28. 27 T1-29. 28 T1-29. 29 T1-30. 30 T1-31.

[30] Mr Connolly recalls receiving a termination letter dated 28 July 2015 from Mr Carmichael, addressed to a former residence that Mr Connolly had left in early 2012. Mr Connolly was unable to say when he received the document, although it was not given to him at the meeting on 27 July 2015.31

[31] In cross-examination, Mr Connolly did not resile from the gist of his evidence in respect of the telephone discussion on 9 May 2015 with Mr McCall, namely that it was an offer to come on board as a consultant with QRU for $3,000 a week until the end of the 2016 Super [Rugby] Season.32 Mr Connolly denied that Mr McCall had said in the conversation that “if you’re not performing, you won’t be there until 2016.”33 Mr Connolly was adamant that the discussion with Mr McCall included discussion about the figure of $3,000 [per week].34

[32] Mr Connolly was adamant in cross-examination that Mr McCall was present at the boardroom meeting at QRU on Monday 11 May 201535 and maintained that there was a discussion at the end of that meeting about Mr Connolly going to the World Cup and being paid.36

[33] In cross-examination, Mr Connolly conceded in respect of the QRU employment contract that (contrary to paragraph 11 of the Further Amended Statement of Claim) he had taken “a very quick glance at the front page and thought ‘this is the wrong contract.’”37 He acknowledged that he signed the QRU employment contract (and subsequently the first QRU contractor agreement) but explained that he did this on the basis that it was “based out of loyalty and getting on with the job and trust.”38

[34] Mr Connolly gave evidence that after signing the QRU employment contract, he had rung Mr Selwood and notified him that it was an incorrect contract and that he wanted to be paid on invoice as a contractor.39 Mr Connolly gave evidence that he had “clearly told [Mr Selwood] that the first contract was an employee contract, and the agreement was a consultant”, and that Mr Selwood had got back to him and said “yes, you’re right.”40 Mr Connolly also said that Mr Selwood told him that the employee contract “was wrong” and that there would be a further contract coming out.41

[35] Mr Connolly agreed in cross-examination that he received an email from Sam Cordingley on 2 June 2015 with a contractor agreement and that he had signed it and returned it to QRU.42 Mr Connolly accepted that this contractor agreement (the first

31 T1-31. 32 T1-33 – 1-34. 33 T1-37. 34 T1-38. 35 T1-39. 36 T1-40. 37 T1-44. 38 T1-44. 39 T1-47. 40 T1-48; T1-49. 41 T1-49. 42 T1-51; Exhibit 1 pp 38-45.

contractor agreement) contained a clause which stated “commences and continues to one week after Super Rugby in 2016 unless terminated in accordance with the terms of the agreement.”43

[36] Mr Connolly, during cross-examination, affirmed his evidence in chief that he had a conversation with Mr Selwood after signing and returning the first contractor’s agreement in the following terms: “Mate, get the whiteout out, because there was no agreement with the termination clauses,” to which Mr Selwood had responded “I’ll have to get back to you,”44 and that subsequently a third contract (the second contractor’s agreement) was sent out to Mr Connolly by Mr Selwood.45

[37] Mr Connolly, in cross-examination, confirmed that at the first termination meeting on 22 July 2015, after informing Mr Carmichael that his agreement with Rod McCall was to the end of the 2016 Super Season, Mr Carmichael said “I’ll have to get back to Rod on this.”46

[38] Mr Connolly agreed that there was a subsequent meeting on 27 July 2015. Mr Connolly did not accept that Mr Carmichael had told him he had spoken with Mr McCall and that there was not an agreement that Mr Connolly would be retained until the end of the 2016 season, but did agree that Mr Carmichael said that QRU “were going to terminate the employment.”47

[39] During cross-examination, Mr Connolly conceded in respect of the employment contract that: “I didn’t read all of it. I read the first bit, signed it foolishly, realised it was an employment contract because it had holidays on it in big letters, ran it off, put it on the back seat of the car, signed it a couple of days later, went to drop it back in. It was the wrong contract… as I’ve said before.”48

[40] In respect of the first contractor agreement (the second document signed), Mr Connolly conceded that he had signed it, and said that he: “Flicked through that a bit more. And then… out of good will and history, I signed it foolishly, sent it back and rang Ashley immediately and said: ‘this is incorrect. I never agreed to that.’ He said ‘I’ll get back to you.’ He got back to me and said ‘yes, it is incorrect.’”49

43 T1-52. 44 T1-55. 45 T1-56. 46 T1-57. 47 T1-59. 48 T1-60. 49 T1-60 – 1-61.

[41] It is clear that under cross-examination, Mr Connolly did accept (contrary to his amended pleadings) that he had read some of the employment contract50 and part of the first contractor agreement.51

Sam Cordingley

[42] Sam Cordingley gave evidence in the plaintiff’s case. He had known the plaintiff since Mr Cordingley was a professional rugby player. Mr Connolly obtained a contract for him with the Queensland Reds, and later at Swansea in the United Kingdom. As at May, 2015, Mr Cordingley was the General Manager, High Performance at QRU.52

[43] Mr Cordingley did not play any role in the negotiation of the appointment of Mr Connolly to the coaching consultant position, although he did attend a meeting at QRU on Saturday 9 May, 2015 with Phillip Pope (General Manager of Communications QRU), Tom Kennedy (Media Manager of the Queensland Reds) and Jim Carmichael (CEO QRU).53

[44] Mr Cordingley agreed that he received an email54 from Jo Newman (Payroll Officer QRU) and had been asked to pass on the attached employment contract to Mr Connolly to him. Mr Cordingley said that the contract was not sent to him to check, and that he had not provided the remuneration figure of $3,000 a week [to Ms Newman] for the contract.55

[45] Mr Cordingley recalled being present at a meeting in the boardroom on Monday 11 May 2015, where Mr Connolly, Mr Carmichael and, for part of the meeting, Mr Graham, were present. Mr Cordingley did not recall Mr McCall attending at that meeting, although Mr McCall did attend at a later player’s group meeting.56

[46] Mr Cordingley’s recollection is that the only discussion about Mr Connolly’s employment at the meeting on Monday 11 May 2015 was Mr Connolly’s role, but not the length of the employment. He conceded, however, that he did not have a clear recollection of the meeting.57 Mr Cordingley had no recollection of the topic of Mr Connolly’s working for QRU at the World Cup being discussed in the meeting.58

[47] Mr Cordingley stated that he was not aware of playing any role in any subsequent versions of contracts sent by or on behalf of the QRU to Mr Connolly.59

50 T1-62. 51 T1-63. 52 T1-64. 53 T1-65 – T1-66. 54 Exhibit 1 p.10 55 T1-67. 56 T1-71. 57 T1-71 – 1-72. 58 T1-72. 59 T1-73.

[48] Mr Cordingley was present at a termination meeting with Mr Connolly and Mr Carmichael, and recalls “after John [Connolly] was told that it was a termination meeting, John let Jim [Carmichael] know that he had a separate verbal agreement with Rod McCall around his contract” in respect of “just the term.”60 Mr Cordingley’s recollection was that “the inference was [that John Connolly said] I can’t be terminated because my contract runs through until the end of the term as per… the contract.”61

[49] Mr Cordingley was also present at a second termination meeting on 27 July 2015, with Mr Carmichael and Mr Connolly. Mr Cordingley recalls that “it was the second termination meeting, and Jim [Carmichael] confirmed with John [Connolly] that he’d in fact spoken to Rod McCall and what John had suggested in the first meeting was inaccurate, that Rod hadn’t guaranteed him anything verbally and that it was as per the contract.” Mr Cordingley identified “the contract” as being “per the agreed terms” of “the contract that has been signed”, and then stated that he believed that Mr Connolly “was sending invoices through, so I assumed that… there was a contract that had been signed.”62

[50] In cross-examination, Mr Cordingley stated that his only role in respect of Mr Connolly’s invoices was signing off as the General Manager of Rugby Operations after the invoices had gone through Jo Newman in the Finance Department.63

[51] Mr Cordingley recalls handing Mr Connolly a copy of the termination letter64 either “the day of the termination meeting” or “within a day or two after.”65

Defendant’s evidence

Rod McCall

[52] Rod McCall played rugby for both Queensland and Australia, and had been involved with organisations at all levels of the game over some 13 years, including two Brisbane rugby clubs, Queensland Rugby Union and Australian Rugby Union. Mr McCall had been a member of the Queensland Rugby Union Board from September 2009 until February 2016 and had acted as Chairman of the Board for that period.66

[53] The Board was responsible for governance, strategy, financial guidelines, overseeing the business, giving direction and working with the executive, and the CEO (then Jim Carmichael) was responsible for the day-to-day running of the organisation.67

60 T1-73. 61 T1-73 – 1-74. 62 T1-75. 63 T1-76. 64 Exhibit 1 p. 67. 65 T1-80. 66 T1-86. 67 T1-86.

[54] Mr McCall gave evidence of having a good relationship with Mr Carmichael, who was not from a rugby background, but Mr McCall claimed not to have had any role in negotiating contracts and their terms other than for the CEO and the Head Coach.68

[55] Mr McCall had known Mr Connolly for a long period of time. Mr Connolly was been coach when Mr McCall played and captained the Queensland Rugby Union side. Although their relationship was intermittent as of 2015, Mr Connolly had been texting after Queensland Reds games, offering suggestions and in around March, 2015, he was offering to help.69

[56] Mr McCall met with Mr Connolly on Easter Sunday in April 2015 at Coolum, then arranged for Mr Connolly to meet with Mr Carmichael in Melbourne later in April 2015 so that they could establish a relationship.70

[57] On 8 May 2015, Mr McCall attended a match between the Queensland Reds and the Crusaders in New Zealand, as did Jim Carmichael. Mr McCall gave a frank and scathing assessment of the Queensland Reds’ performance in these terms:- “It was a fairly diabolical performance by the team. They weren’t expected to, possibly, to win, but the manner in which they lost was appalling.”71

[58] Mr McCall gave evidence that subsequent to that loss, he and Jim Carmichael decided it would probably be worth the risk taking Mr Connolly on to “take some heat off the team’s performance… [and to] give it a new focus and try and reinvigorate… the performance of the team.”72

[59] Mr McCall gave evidence that “the next day we got back from New Zealand, I rang John [Connolly] and told him that we were going to bring him on.”73 Mr McCall said that the only other part of the conversation was that “someone – Phil Pope or someone would send him [John Connolly]… a press release outlining the matter and get in touch with Jim [Carmichael].”74

[60] Mr McCall then said: “There was a second phone call. It must have been after John received the press release which clearly said ‘bringing on for the 2015 season’ and John made a comment around, ‘can it say 2016?’ and that was in the second phone call. And I was quite clear that ‘mate, the press release can say whatever you want it to say. Sort it out with Phil. But you’ll have to sign a contract like everyone else.’”75

68 T1-86. 69 T1-87. 70 T1-87. 71 T1-87. 72 T1-88. 73 T1-88. 74 T1-88. 75 T1-88.

[61] Mr McCall asserted that he had read a draft press release on his mobile phone while watching football prior to the telephone conversation with Mr Connolly.76

[62] Mr McCall gave evidence that he was aware that the relationship between Mr Connolly and the Head Coach [Richard Graham] was strained, that the Head Coach was not in favour of the appointment but that the decision was out of his hands.77

[63] Mr McCall claimed not to have discussed a weekly payment to be made to Mr Connolly, nor an arrangement of Mr Connolly being paid on invoice. Mr McCall’s evidence is that his first knowledge of Mr Connolly’s pay terms was in his regular weekly Wednesday catch-up with Jim Carmichael (CEO) which was when he was first told that Mr Connolly was being paid $3,000 a week. Mr McCall says he was not told, but assumed, that Mr Connolly was going to be an employee.78

[64] Mr McCall’s evidence is that he and Mr Carmichael went to a meeting in the Ballymore grandstand with the players before training which Mr McCall imagined “was probably going to start at 3.30 or 4 or something like that, and we went to a meeting half an hour before that started and addressed the players. [I] thought it was important to outline the disappointment of the organisation with their performance on the weekend and also introduce John as coming on board to assist.”79

[65] Mr McCall denied having any meetings prior to the player’s meeting with Mr Connolly that day, either in the boardroom or otherwise.80

[66] Mr McCall was shown a draft press release contained in an email from Tom Kennedy [Queensland Reds Media Manager] to Phillip Pope [Queensland Rugby Union Media Manager] sent on Saturday 9 May 2015 at 12.56pm. The first paragraph of that draft press release reads:- “Former Reds and Wallabies Coach John Connolly will join the St George Queensland Reds’ coaching staff as a consultant Monday, in advance of their home game against the Rebels. He will be contracted to the Reds for the remainder of the 2015 Super Rugby season and for the 2016 Super Rugby season.”81

[67] Mr McCall’s evidence is that there was an earlier version of this press release, and this was the reason that Mr McCall had a second conversation with Mr Connolly (in respect of the term of Mr Connolly’s engagement). Mr McCall said that the phone call to Mr Connolly occurred about 30 minutes prior to kick off of a rugby game at 1.00pm at Tingalpa that he was watching.82

76 T1-88. 77 T1-88. 78 T1-88 – T1-89. 79 T1-89. 80 T1-89. 81 Exhibit 1 p. 9. 82 T1-92.

[68] When pressed on the issue, Mr McCall was confident that there were two conversations between himself and Mr Connolly on Saturday 9 May 2015. Mr McCall was adamant that the first telephone conversation related to Mr Connolly coming on board for the 2015 season, and asserted that it was only after the second conversation that he [Mr McCall] agreed to also include the 2016 season. Mr McCall denied that he and Mr Carmichael had agreed to offer Mr Connolly a position as coaching consultant to the end of the 2016 Super Ruby season before Mr McCall phoned Mr Connolly. Mr McCall maintained that he had never discussed the payment of $3,000 a week.83

[69] In cross-examination, Mr McCall acknowledged a series of emails with attached draft press releases exchanged initially between Tom Kennedy and Phillip Pope, commencing at 9.52am on Thursday 7 May 2015, then circulated to Mr McCall at 5.54pm on 7 May 2015, at which stage the draft had been altered to indicate that Mr Connolly would “work with the Reds for the remainder of the 2015 Super Rugby season.”84

[70] Mr McCall acknowledged that at 8.10am on 9 May 2015, he received a copy of an email from Mr Carmichael to Phillip Pope, Tom Kennedy and Sam Cordingley, in which the relevant draft press release paragraph stated that Mr Connolly would be “contracted to the Reds for the remainder of the 2015 and 2016 Super Rugby seasons.”85 Mr McCall’s evidence was that Mr Carmichael and he had been working on the press release when they flew back together on the plane from New Zealand in the early hours of 9 May 2015.86

[71] Mr McCall acknowledged a further email from Phillip Pope was addressed to Jim Carmichael and himself, was dated at 11.27am on 9 May 2015, and contained an attachment of a draft press release in which the reference to the term stated that Mr Connolly would be “contracted to the Reds for the remainder of the 2015 Super Rugby season and for the 2016 Super Rugby season.”87

[72] In the light of the email, Mr McCall conceded that the contracting period for Mr Connelly in the draft press release attached to the email had been settled as a two year (i.e. two season) period rather than just the 2015 season. Despite this conversation, Mr McCall remained adamant in cross-examination that he had two telephone conversations with Mr Connolly on 9 May 2015.88

[73] Mr McCall, in cross-examination, did not recall being present at a meeting in the QRU boardroom on Monday morning, 11 May, 2015 with Mr Connolly, Mr Carmichael, Mr Cordingley and (for part of the meeting) Mr Graham. Mr McCall did not accept that there was any conversation with Mr Connolly at that meeting about

83 T2-5. 84 T2-6 – T2-8. 85 Exhibit 2 p. 9; T2-8. 86 T2-8. 87 Exhibit 2 pp. 13-14; T2-9. 88 T2-10.

the terms of his appointment, given his recollection that he was not at the Monday morning meeting.89

[74] Mr McCall did not recall having a conversation at any stage with Mr Connolly about the notice provisions of the agreement (whether 30 or 60 days) but gave evidence that “I think I did say the words you’ll be contracted like everyone else.” Mr McCall went on to explain that “the standard QRU employment contract has a termination clause.”90

[75] Mr McCall did accept that he offered Mr Connolly the job, and that he did so initially, without board approval.91

[76] In respect of Mr Connolly’s termination, Mr McCall gave evidence that he made it “very clear that in the dozen or so conversations [he] had with [Mr Connolly] over the period leading up to his appointment, [he] was very clear that if it didn’t work out and if [Mr Connolly] didn’t work with the coach, then [Mr Connolly] would not be there.”92

[77] In respect of Mr Connolly’s attendance at the World Cup, Mr McCall said that his view was that if Mr Connolly “hadn’t accrued any leave he wouldn’t be paid” and would be “taking time off without pay.”93

[78] In respect of Mr Connolly’s position at QRU, Mr McCall gave evidence that the recommendation of the review conducted at the end of the 2015 season was “to terminate the role of coaching consultant” and that it was the CEO had the task of terminating Mr Connolly’s role.94

[79] Mr McCall did not recall any conversation between himself and the CEO (Jim Carmichael) subsequent to the first attempt to terminate Mr Connolly’s arrangement.95

Ashley Selwood

[80] Ashley Selwood gave evidence that he had been involved in Rugby Union administration for 22 years, working for the Queensland Rugby Union, the New South Wales Rugby Union and the Australian Rugby Union. Between September 2011 and September 2015 he was the Chief Financial Officer (CFO) for Queensland Rugby Union. His responsibilities were to manage the finance and administration function of the QRU. He reported to the then CEO, Jim Carmichael.96

89 T2 13-14. 90 T2-15. 91 T2-15. 92 T2-16. 93 T2-17. 94 T2-18. 95 T2-19. 96 T2-28.

[81] Mr Selwood gave evidence that there were two standard contracts, an employee contract and a contractor agreement, utilising templates.97

[82] Mr Selwood had known John Connolly for more than 20 years, having worked together in 1993 at the Queensland Rugby Union when Mr Connolly was coach of the Reds.98

[83] Mr Selwood first became aware that Mr Connolly was to work as a coaching consultant for QRU when he was copied into an email on the Saturday after the Queensland Reds had played in New Zealand on the Friday night (i.e. 9 May 2015).99

[84] Mr Selwood was not involved in any of the discussions about the engagement of Mr Connolly, in particular, placing him on an employee contract. The employee contract was put together by Ms Jo Newman, who ran the payroll, and reported to Mr Selwood.100

[85] Towards the end of May 2015, Mr Connolly rang Mr Selwood and asked if he could invoice QRU for his time or services, indicating that he had his own ABN, could charge GST and could look after his own tax.101 By that stage Mr Selwood had gathered that Mr Connolly was being paid on a weekly basis, believed there was less risk in agreeing to making Mr Connolly a contractor, and therefore agreed to allow Mr Connolly to invoice QRU. The payment on a weekly rate was, In Mr Selwood’s experience, unusual. In twenty odd years in rugby, Mr Selwood had not heard of anyone being employed as an employee on a weekly rate, rather on an annual salary.102 Mr Selwood said that “there was no mention of the existing [employee] contract” in the conversation with Mr Connolly.103

[86] Mr Selwood gave evidence that a contractor agreement was put in place and sent to Mr Connolly some days later, prepared by Jo Newman and forwarded to Mr Connolly through Sam Cordingley. Mr Selwood was not involved in the preparation of this contractor agreement, which was a standard document put together by Jo [Newman].104

[87] Mr Selwood recalls subsequent conversations with Mr Connolly, when Mr Connolly was checking on the payment of invoices. During a conversation with Jim Carmichael (CEO), having indicated to Mr Connolly that he would endeavour to get Mr Connolly’s June invoice paid by 30 June, Mr Selwood “found out actually [from Jim Carmichael] for the first time to my knowledge at that stage that he [John

97 T2-28. 98 T2-29. 99 T2-29. 100 T2-30. 101 T2-30. 102 T2-31. 103 T2-31. 104 T2-32.

Connolly] was given a 60 day termination clause in his contract, [rather] than the normal 30 [days].”105

[88] Mr Selwood then went and looked at the contractor agreement with John Connolly, which only allowed for 30 days, formed the view that it was not fair to continue on that arrangement, and prepared a second contractor agreement with a 60 day termination provision and sent it to John Connolly.106 Mr Selwood personally made amendments to the “soft copy of the first contract agreement” sent to him by Jo [Newman] which he then onforwarded to Mr Connolly attached to an email dated 9 July 2015.107 Mr Selwood did not recall any conversation with Mr Connolly subsequent to that email.108

[89] In cross-examination, Mr Selwood confirmed that he received the information about Mr Connolly’s appointment via a press release attached to an email to the QRU Board which he received in his role as company secretary109 and accepted that the term of the appointment in the press release contained in that email was “to the end of the 2016 rugby season.”110

[90] Mr Selwood acknowledged that Ms Newman initially prepared an employee agreement contract for Mr Connolly, but was unable to say who had instructed Ms Newman to do so, although he said that he had not given her those instructions.111

[91] Mr Selwood had no direct knowledge of where the term contained in the employment contract, namely terminating “one week after the Reds’ final game in the Super Rugby competition in 2016” came from.112

[92] Mr Selwood did not give instructions to Ms Newman to extrapolate the weekly amount to a per annum amount in the initial employment contract,113 nor did he give any instructions in respect of the telephone reimbursement.114 Similarly, Mr Selwood was unable to say where the “60 day notice period” at Item 8 of the employment contract came from,115 although he said the standard provision would be “30 days”.116

[93] Mr Selwood accepted that Mr Connolly was paid for his May invoice because he was “chasing the funds at that point and the contract was in the process of being finalised”.117

105 T2-33. 106 T2-34. 107 Exhibit 1 p. 64. 108 T2-35. 109 Exhibit 1 p. 9. 110 T2-38. 111 T2-40. 112 T2-41. 113 Exhibit 1 p. 11; T2-41. 114 T2-41 – T2-42. 115 Exhibit 1 p. 11. 116 T2-42. 117 Exhibit 7; T2-44.

[94] Mr Selwood did not recall any conversation with Mr Connolly in which Mr Connolly said, “You’ll have to get the whiteout out because I haven’t agreed to any termination provision”, and stated further that he didn’t find out “about 60 days [termination period] until a subsequent discussion with the CEO”.118

[95] Mr Selwood sought instructions from Mr McCall and Mr Carmichael in respect of paying Mr Connolly while attending the Rugby World Cup in an email dated 10 June 2015.119 These instructions were sought by Mr Selwood from the CEO and the Chairman of the Board because Mr Selwood understood that they had engaged Mr Connolly.120

[96] Mr Selwood confirmed that he had not agreed the termination provision with Mr Connolly personally.121

[97] Mr Selwood gave evidence that he had been instructed as of 7 July 2015 by the CEO that the termination period agreed with Mr Connolly was 60 days.122

[98] Mr Selwood was adamant that there was no conversation with Mr Connolly in which he had said that the first contract’s agreement was wrong because it contained a termination provision which had not been agreed.123

Jo Newman

[99] Ms Newman is the payroll officer at the Queensland Rugby Union and has worked in that role since February 2014. She is responsible for processing then effecting payments to employees, contractors, suppliers and creditors of QRU. She did not have authority to actually make the payments.124

[100] From time to time, Ms Newman prepared employment contracts based on a template, usually with instructions from the CFO who at the relevant time was Ashley Selwood, her immediate boss.125

[101] Ms Newman prepared a draft employee contract for Mr Connolly and her recollection was that the details to fill in that contract “would have been from Ashley [Selwood]. He would have told me the amount and – yeah the terms of the contract”.126

[102] Ms Newman did not, however, have a specific recollection as to who provided the information she used to determine Mr Connolly’s salary.127

118 T2-45. 119 Exhibit 8. 120 T2-46. 121 Exhibit 1 p. 63; T2-47. 122 Exhibit 9; T2-48. 123 T2-49. 124 T2-51. 125 T2-52. 126 T2-52. 127 T2-53.

[103] Ms Newman was also involved in drawing up a contractor agreement with Mr Connolly using the same dollar figure ($3,000 per week) and this was sent to Mr Cordingley to send on to Mr Connolly.128

[104] Ms Newman received invoices from Mr Connolly via Mr Selwood, entered them into the system and when Mr Selwood gave her approval, they were loaded for payment. She was not however authorised to make the payments.129

[105] Ms Newman was unable to process Mr Connolly’s pay as an employee, because she didn’t have “any tax file numbers, super, bank details, anything from him at that stage”.130

Jim Carmichael

[106] Mr Carmichael was the Chief Executive Officer (CEO) of the QRU from 5 November 2009 to 13 May 2016. Prior to that he had been involved in a number of businesses as Chief Executive Officer, and had been involved with the AFL in Melbourne.131

[107] Mr McCall was the Chairman of the Board when Mr Carmichael was CEO, and Mr Carmichael was also a Board member.132 All of Mr Carmichael’s regular dealings with the Board on a day to day level went through Rod McCall.133

[108] Mr Carmichael did not know John Connolly personally, although he had spoken to him once prior to 9 April 2015 about a rugby union matter on the Sunshine Coast. Mr Carmichael met Mr Connolly at Melbourne Airport on 9 April 2015 as a result of a request from Mr McCall to see if there was some way Mr Connolly could help the football program.134

[109] Mr Carmichael attended the Queensland Reds against the Crusaders game in Christchurch, New Zealand on 8 May 2015, having flown from Brisbane via Sydney to collect his passport and only arriving halfway through the game.135

[110] Mr Carmichael gave evidence that he and Mr McCall had, on a number of occasions, over a number of months, discussed a way that Mr Connolly could help in the Queensland Rugby program. Mr Carmichael described the results of the match against the Crusaders as “particularly embarrassing for the team” and stated: “Our coach at the time had been under a lot of pressure, particularly public pressure, media pressure on performance. Rod [McCall] had for a long time had a view that a lot of the problems were player related and after that game it was particularly embarrassing the way the team

128 T2-54. 129 T2-54. 130 T2-54. 131 T2-56. 132 T2-56. 133 T2-57. 134 T2-57. 135 T2-57.

had performed. There was a lot of talk about there needing to be changes in the market and Rod and I met after the game (the hotel) and spent a couple of hours talking about what John [Connolly] may be able to offer if he came and got involved with our program.”136

[111] Mr Carmichael gave evidence that after the conversation with Mr McCall he contacted his “communications fellow” who was travelling with the team and received a draft press release at breakfast the next day to look at. Mr Carmichael said that he “spent a fair amount of time on the plane with [Mr McCall] just addressing some of the things in terms of whether it covered everything we needed [it] to”.137

[112] Mr Carmichael recalled a meeting on the following Monday (11 May 2015) at which Sam Cordingley (General Manager of Football), Richard Graham (coach) and John Connolly were present. Mr Carmichael could not recall if Rod McCall attended or couldn’t attend.138

[113] Mr Carmichael recalls that the meeting was at 9.00am in the QRU boardroom, although it might have been a bit earlier. It was a meeting to bring “the two key football people and John [Connolly] together where we could have … a conversation around what the guys were going to be working on in terms of next steps with the football department”.139

[114] Mr Carmichael was clear that he did not, in that meeting, discuss “the terms or payment” that Mr Connolly was to receive, and that he did not want that information shared with the coach and the Football Manager.140

[115] Mr Carmichael’s evidence is that on Monday (11 May 2015) he “met with my CFO [Mr Selwood] and briefed him on John [Connolly] coming on board, said I wanted him to draft up for me an employment agreement, and I gave him some terms to go and put into…the agreement [which] Mr Selwood then went away and did”.141

[116] Mr Carmichael gave evidence that “my instruction to Ash [Selwood] was that John [Connolly] should be remunerated at $3,000 a week. The termination clause, which is a standard clause we have in all contracts in terms of the wording, would be 60 days. From memory, a mobile phone, and that was really those pieces, and then a term – I set it at the end of our 2016 season”, which Mr Carmichael said “would give…the best opportunity for John [Connolly] and Richard [Graham] to work closely together”.142

136 T2-57. 137 T2-58. 138 T2-59. 139 T2-59. 140 T2-59. 141 T2-59. 142 T2-60.

[117] Mr Carmichael’s recollection was that his “initial instructions to set the agreement up with John [Connolly]… was done very early once we’d made the decision”.143 Subsequently, there was a discussion with Mr Selwood about a change from an employment agreement to a contractor’s agreement. Mr Carmichael had nothing to do with putting together the document other than instructing the CFO (Mr Selwood) as to the terms around the remuneration.144

[118] Mr Carmichael identified the witness signature to the contractor agreement145 as Ms Dimity Pearson, his personal assistant.146 Mr Carmichael recalled another conversation about Mr Connolly’s employment during one of the regular meetings with Mr Selwood in which they discussed the termination clause of Mr Connolly and Mr Carmichael said to Mr Selwood “John’s agreement is 60”.147

[119] In respect of Mr Connolly’s attendance at the World Cup, Mr Carmichael said that his view was that there would be “some approved leave” by then and went on to say that he “didn’t see it as a major issue”.148

[120] In respect of the second contractor’s agreement, Mr Carmichael identified his signature on the contract149 although he had no recollection of physically signing the document. Mr Carmichael was unable to say whether it was his “electronic signature” but said that his staff would “sometimes electronically use my signature”.150

[121] Mr Carmichael recalled a meeting with Mr Connolly and Mr Cordingley (then General Manager of Football), in which Mr Connolly was advised that there had been a review and that “one of the recommendations was that the role of John [Connolly] was fulfilling wouldn’t be continued”.151 Mr Carmichael recalls that Mr Connolly said that he had “an iron clad guarantee” from Rod McCall that this deal he was on would continue to 2016 end of season. Mr Carmichael said: “And I – frankly, I was very surprised in that. And I said to John, ‘Look, I’m surprised in that’. I said, ‘So what I think we need to do is business as usual for the next few days. Let me please go back and clarify with Rod [McCall] whatever it is that you are saying Rod has said to you.’”152

[122] Mr Carmichael gave evidence that having spoken to Mr McCall over the phone, he then arranged to again meet with John Connolly and Sam Cordingley. At that meeting, Mr Carmichael said “…to John that Rod emphatically denies ever having that conversation with you about an iron clad agreement to that period. I said, “Well

143 T2-61. 144 T2-61. 145 Exhibit 1 p. 80. 146 T2-62. 147 T2-62. 148 T2-63. 149 Exhibit 1, p. 86; T2-64. 150 T2-64. 151 T2-64 – T2-65. 152 T2-65.

John, based on the conversation I’ve had with Rod, it doesn’t change”. I said, “So we’re still going to – we’re going to terminate the agreement and I will draft a note for you to be able to come and see me with – pick up the very next day”. Mr Carmichael confirmed that the letter he referred to (the termination letter)153 was a letter dated 28 July 2015 to Mr Connolly.154

[123] In cross-examination, Mr Carmichael gave evidence that he determined the quantum of the terms for John Connolly on the plane trip back from New Zealand on Saturday, 9 May 2015, when seated with Mr McCall. Mr Carmichael recalls Mr McCall asking him what he (Mr Carmichael) was thinking of paying and Mr Carmichael responded “I’m thinking the right figure is between $2,500 and $3,000”.155

[124] In cross-examination, Mr Carmichael conceded that although he did not remember draft press releases being prepared prior to the game in New Zealand (i.e. prior to 8 May 2015), this was inconsistent with the disclosed emails from 7 May, 2015.156 Mr Carmichael acknowledged that the draft press releases157 showed a changing view about whether the appointment of Mr Connolly was to be one or two seasons.158

[125] Mr Carmichael accepted that after the game on 8 May 2015, he and Mr McCall were firmly of the view that they would appoint Mr Connolly. Mr Carmichael acknowledged sending an email under his name to Mr Pope, Mr Kennedy, Mr Cordingley and Mr McCall on 9 May 2015 at 8:10:41AM AEST containing a draft press release,159 although he did not believe his flight had arrived back in Australia at that time. However, Mr Carmichael acknowledged that by the time he sent that email160 on Saturday morning, he had “decided to appoint [Mr Connolly] for the two seasons”.161

[126] In cross-examination, Mr Carmichael acknowledged that there was a meeting with Sam Cordingley, Richard Graham and Mr Connolly on Monday morning [11 May, 2015] in the boardroom, but he (Mr Carmichael) couldn’t “remember if Rod [McCall] was there”.162 Mr Carmichael did not have a specific memory of a subsequent meeting with the players addressed by Mr McCall, even though it was described to him in cross-examination as “quite a colourful meeting on Mr McCall’s part”.163

[127] Mr Carmichael could not recall any discussion with Mr Connolly about the term of the appointment, the payment per week, and the arrangements for Mr Connolly to go

153 Exhibit 1 p. 67. 154 T2-65. 155 T2-67. 156 Exhibit 2 pp. 1-7; T2-70. 157 Exhibit 2 pp. 1-7. 158 T2-72. 159 T2-72 – T2-73; Exhibit 2 pp. 8-9. 160 Exhibit 2 pp. 8-9. 161 T2-74. 162 T2-74. 163 T2-74.

to the Rugby World Cup in that meeting, and went so far as to say such a conversation did not happen.164

[128] Mr Carmichael accepted that there were two termination meetings, with the first being on 22 July 2015. In that meeting, when Mr Connolly was told that Mr Carmichael was going to terminate his arrangement, Mr Carmichael recalls that the gist of what Mr Connolly said was “his agreement was for a two year term and that’s the deal he had with Rod”.165 Mr Carmichael said that he was “very surprised and I [said that I] would check with Rod”.166

[129] Mr Carmichael accepted that it was Mr McCall who rang and appointed Mr Connolly.167

[130] Mr Carmichael accepted that his media staff had sent Mr Connolly a draft press release which said that Mr Connolly was being contracted for two seasons.168

[131] Mr Carmichael accepted that there was a second termination meeting on 27 July 2015, but denied that he said to Mr Connolly “I’ve spoken to McCall. He did agree that, but we’ve changed our mind” and “we’re terminating you”.169 Mr Carmichael did, however, agree that “there was no discussion about what the notice period was”.170

[132] Mr Carmichael confirmed that he was responsible for preparing the termination letter to Mr Connolly, although he said that he may have had some legal advice as to its content.171

Discussion

1. Terms of the contract

[133] The decision to engage John Connolly as a coaching consultant was the culmination of discussions between the Chairman Rod McCall and the CEO, Jim Carmichael commencing at least as early as 7 May 2015, when Phillip Pope (Queensland Rugby Union Media Manager) sent an email to Tom Kennedy (Queensland Reds Media Manager) at 9.52am on Thursday 7 May 2015172 with an attached draft media release which contemplated Richard Graham being retained as coach for the 2016 Super Rugby season, supported by “coaching advisor” John Connolly.173 Later on 7 May 2015, in an email from Tom Kennedy to Phillip Pope at 5.32pm, the draft referred to John Connolly joining “the Reds’ coaching staff” and noted that he would “work with

164 T2-75. 165 T2-78. 166 T2-78. 167 T2-80. 168 T2-80. 169 T2-83. 170 T2-83. 171 T2-84. 172 Exhibit 2. 173 Exhibit 2 pp. 1-2.

the Reds for the remainder of the 2015 Super Rugby season.”174 By 6.31pm on Thursday 7 May 2015, in an email from Phillip Pope to Rod McCall, cc’d to Jim Carmichael, the draft press release referred to Mr Connolly joining the “coaching staff as a consultant” and noted further that he would be “contracted to the Reds for the remainder of the 2015 and 2016 Super Rugby seasons.

[134] Critically, a draft press release175 attached to an email from Phillip Pope to Tom Kennedy dated 9 May 2015 at 10.44am referred to Mr Connolly as “a consultant” and stated that he would be “contracted to the Reds for the remainder of the 2015 Super Rugby season and for the 2016 Super Rugby season.”176 A further email from Phillip Pope to Jim Carmichael, Rod McCall and cc’d to Tom Kennedy and Sam Cordingley on 9 May 2015 at 11.27am indicated that the contract would be “for the remainder of the 2015 Super Rugby season and for the 2016 Super Rugby season.”177

[135] Rod McCall’s evidence is that after the loss by the Queensland Reds to the Crusaders on the evening of 8 May 2015, Mr McCall and Mr Carmichael decided to take Mr Connolly on.178 Mr McCall gave evidence that he was the person who contacted Mr Connolly on behalf of QRU.179

[136] Jim Carmichael confirms the discussion with Mr McCall about bringing John Connolly into the program.180 Mr Carmichael recalls discussing with Mr McCall a payment figure of $2,500 to $3,000 (by inference, per week),181 and accepts that it was Mr McCall who rang and appointed Mr Connolly.182

[137] Mr Connolly recalls that the telephone conversation between himself and Rod McCall on Saturday 9 May 2015 was short, that he (Mr Connolly) was shopping at Woolworths, and that he was asked by Mr McCall if he would “go on board as a consultant, $3,000 a week”183 and was told that the appointment was to be “until the end of the next Super Rugby season” (i.e. July 2016).184 The email with the draft press release that Mr Connolly received (dated 9 May 2015 at 12.56pm) referred to the term in these words:- “He [John Connolly] will be contracted to the Reds for the remainder of the 2015 Super Rugby season and for the 2016 Super Rugby season.”185

174 Exhibit 2 pp. 3-4. 175 Exhibit 2 pp. 7-9. 176 Exhibit 2 pp. 10-12. 177 Exhibit 2 pp. 13 – 14. 178 T1-88. 179 T1-88. 180 T2-57. 181 T2-67. 182 T2-80. 183 T1-23. 184 T1-23. 185 Exhibit 1 p. 9.

[138] Mr McCall’s evidence, on the contrary, is that there were two phone calls on Saturday 9 May, 2015, with the initial offer by Mr McCall being for the balance of the 2015 season, and then a second phone call after Mr Connolly had received the draft press release, and rang Mr McCall asking for the press release to include the 2016 season.

[139] With respect, I am unable to accept Mr McCall’s evidence that there were two phone calls, separated by an email to Mr Connolly referring to him only being contracted for the balance of the 2015 season, although I note that that issue had been the subject of previous draft emails internally within QRU.186 It is clear that as of 8.10am on 9 May 2015,187 subsequent to the discussions after the game on 8 May, 2015 and on the flight back to Australia on 9 May, 2015 between Rod McCall and Jim Carmichael, the term being offered to Mr Connolly was for the remainder of the 2015 and the 2016 Super Rugby seasons.188 This was confirmed in the internal QRU email on 9 May 2015 at 10.44am,189 a further internal QRU email at 11.27am on Saturday 9 May 2015,190 and accords with the email from Tom Kennedy to John Connolly at 12.56pm on Saturday 9 May 2015.

[140] I accept Mr Connolly’s evidence, supported by the QRU emails and I conclude that there was only one phone call between Mr McCall and Mr Connolly on 9 May, 2015. I find that in that phone call, Mr McCall offered to retain Mr Connolly as a coaching consultant from the time of the phone call through to the end of the 2016 Super Rugby season at $3,000 per week. As indicated, that offer was consistent in its term (to the end of the 2016 Super Rugby season) with the discussions between Rod McCall and Jim Carmichael from the evening of 8 May 2015 through the flight back to Brisbane in the early hours of 9 May 2015, and the quantum ($3,000 per week) was consistent with the discussions between Rod McCall and Jim Carmichael as to an appropriate remuneration (in Jim Carmichael’s evidence, between $2,500 to $3,000 per week).191 I find further that this oral discussion between Mr McCall and Mr Connolly made no reference to any termination provisions. I also conclude that Mr Connolly accepted this oral offer on 9 May, 2015, and accordingly turned up in accordance with the agreement at QRU on Monday 11 May, 2015 to commence providing his services. It is therefore not necessary to resolve the disputed conversations between Mr Connolly and QRU representatives at the meeting on Monday, 11 May, 2015, which, in my view, do not alter my findings about the quantum and term of the contract.

2. Was the contract for Mr Connolly’s services oral, written or both?

[141] The first written contract drafted by QRU was prepared by Jo Newman, Payroll Officer at QRU, based on a template employment contract and forwarded as an attachment to an email to Sam Cordingley by Ms Newman.192 This contract referred

186 Exhibit 2 pp. 3-4; Exhibit 2 pp. 5-6. 187 Exhibit 2 p. 8. 188 Exhibit 2 pp. 8-9. 189 Exhibit 2 pp. 10 – 12. 190 Exhibit 2 pp. 13-14. 191 T2-67. 192 Exhibit 1 pp. 10-14.

to a “salary” of “$156,000 per annum”, and then in brackets “or $3,000 per week for the period of the contract.”193 The term was identified as “commencing 11 May 2015 and terminating one week after the Reds’ final game in Super Rugby competition in 2016.”194

[142] Mr Ashley Selwood (CFO) was not involved in the preparation of the document195 which he says was put together by Jo Newman. Mr Selwood was unable to say who had instructed Ms Newman to prepare the employment agreement contract, but gave evidence that it was not him.196 Mr Selwood had no direct knowledge of the length of the term in the employment contract.197 Ms Newman’s evidence was that the details to fill in the contract “would have been from Ashley [Selwood]. He would have told me the amount and – yeah, the terms of the contract,”198 but this conflicts with the evidence of Mr Selwood, and Ms Newman does not have a specific recollection as to who she got the salary information from.199

[143] Jim Carmichael gave evidence that he instructed Mr Selwood that Mr Connolly was to be renumerated at $3,000 per week and that the term was to the end of the 2016 season200 but this evidence also conflicts with Mr Selwood’s evidence of a lack of awareness of the contract terms (other than receiving the press release attached to an email to the board of which he was company secretary).201 There is, therefore, no evidence as to who informed Ms Newman in respect of the remuneration and the term of the contract. I note further that Mr Cordingley gave evidence that he played no role in the remuneration figure and said that the contract was not sent to him to check.202

[144] The QRU employment contract was forwarded to Mr Connolly attached to an email from Sam Cordingley dated 14 May 2015,203 and was signed by Mr Connolly on 20 May 2015204 but not by Jim Carmichael (whose signature block appears on the contract) or any other person at QRU.205 Mr Connolly’s pleaded case was that he had not read this first contract (the QRU employment contract),206 but in cross- examination he conceded that he had “a very quick glance at the front page” and thought “this is the wrong contract”.207 Mr Connolly explained signing the

193 Exhibit 1 p. 11. 194 Exhibit 1 p. 11. 195 T2-32. 196 T2-40. 197 T2-41. 198 T2-52. 199 T2-53. 200 T2-60. 201 Exhibit 1 p. 9, T2-38. 202 T1-67. 203 Exhibit 1 pp. 15-20. 204 Exhibit 1 pp. 71-74. 205 Exhibit 1 p. 74. 206 Amended Statement of Claim para 11. 207 T1-44.

employment contract on the basis that it was “based out of loyalty and getting on with the job and trust.”208

[145] Mr Connolly gave evidence that after signing and returning the employment contract to QRU, he rang Mr Selwood and notified him that it was an incorrect contract and that he wanted to be paid on invoice as a contractor.209 Mr Selwood gave evidence that he received a phone call from Mr Connolly “towards the end of May 2015” asking if he [Mr Connolly] could invoice QRU for his time or services, indicating that he had his own ABN, could charge GST and look after his own tax,210 and accordingly Mr Selwood agreed to put a contractor agreement in place with Mr Connolly.

[146] This first contractor agreement contained a 30 day termination clause and was a standard document prepared by Ms Newman.211 This first contractor agreement was sent by Jo Newman to Sam Cordingley, attached to an email dated 2 June 2015 to be on forwarded to Mr Connolly.212 Mr Cordingley forwarded that contractor’s agreement to Mr Connolly shortly after receiving it from Jo Newman.213

[147] Mr Connolly acknowledges also signing the first contractor’s agreement but asserts that he again telephoned Mr Selwood after signing and said “mate, get the whiteout out, because there was no agreement with the termination clauses”, to which Mr Selwood responded “I’ll have to get back to you.”214 This first contractor’s agreement was signed by Mr Connolly but not by Mr Carmichael (or any other person on behalf of QRU). Notably, clause 7.1 of the first contractor’s agreement provides:- “This agreement starts on the date it is signed by both parties and continues for the term as specified in Item 2 of the SOW [Statement of Work] unless it is terminated in accordance with this clause 7.”215

[148] Ashley Selwood gave evidence that he did not recall any conversation about whiteout and termination clauses with Mr Connolly,216 but confirmed that Mr Connolly was paid for his May invoice even though the contract was still in the process of being finalised.217 Mr Selwood, however, says that having been instructed as of 7 July 2015 by the CEO that the termination period agreed with Mr Connolly was 60 days, then made arrangements for the second contractor’s contract agreement to be prepared.218

208 T1-44. 209 T1-47. 210 T2-30. 211 T2-32. 212 Exhibit 1 pp. 30-37. 213 Exhibit 1 pp. 38-45. 214 T1-52. 215 Exhibit 1 p. 78. 216 T2-45. 217 Exhibit 7; T2-44. 218 T2-48.

[149] The second contractor’s agreement was forwarded to Mr Connolly by Mr Selwood attached to an email dated 9 July 2015, and contained a 60 day termination period.219 This second contractor’s agreement220 was signed by Jim Carmichael (although curiously, not witnessed) but was never signed by John Connolly. Again, clause 7.1 of the agreement relevantly provides “This Agreement starts on the date it is signed by both parties…”.221

[150] It is submitted by Mr Hastie QC, who appears on behalf of QRU, that the plaintiff’s signature on the first QRU employment contract (which the plaintiff pleaded he did not read, but admitted in cross-examination that he had had a “very quick glance at the front page and thought, ‘this is the wrong contract’”),222 is binding, although not signed by Mr Carmichael. In short, the submission made is that an offer was made by QRU and accepted by Mr Connolly by either his signature,223 or by his conduct.224

[151] The plaintiff’s submission is that although the employment contract was signed by the plaintiff and returned, it was returned with a caveat, namely that in a disputed conversation with Mr Selwood, Mr Connolly told Mr Selwood that it was the wrong contract and that the agreement was for a consultancy not an employment contract.225 Although Mr Selwood denies that conversation,226 I am satisfied on the evidence that the employment agreement, even if it was operative upon Mr Connolly’s signature alone, came to an end and was subsumed for the following reasons: (1) The plaintiff was clearly engaged as a coaching consultant for a term and on a weekly payment ($3000 per week), which, as Mr Selwood conceded, were clearly characteristics of a contractor;227 and (2) The contract of employment was unsigned by the defendant.

[152] In the context of the evidence that I have accepted in this matter including, on balance, accepting that Mr Connolly made the phone call to Mr Selwood referred to in paragraph 151, I am satisfied that although Mr Connolly signed the written employment contract, he immediately sought to indicate to QRU that he did not wish to be bound by it. Conversely, QRU did not take any practical steps to put the employment contract into operation. Mr Selwood’s evidence is that he had not instructed Ms Newman (payroll officer) to prepare an employee agreement contract.228 Mr Selwood agreed to Mr Connolly’s request to be paid as a contractor on a weekly basis at a weekly rate.229 Ms Newman gave evidence that she was unable to process Mr Connolly’s pay as an employee because she didn’t have “any tax file

219 Exhibit 1 p. 64. 220 Exhibit 1 pp. 81-87. 221 Exhibit 1 p. 84. 222 T1-44. 223 Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165. 224 Brogden v Metropolitan Railway Co [1877] 2 App Cas 666; Weemah Park Pty Ltd v Glenlaton Investments Pty Ltd [2011] Qd R 582. 225 T1-25. 226 T2-31. 227 T2-31. 228 T2-40. 229 T2-31.

numbers, super, bank details, anything from him at that stage”.230 It follows that QRU did not consider itself bound by the employee contract.

[153] I also accept the plaintiff’s submission that there was no part performance of the employee contract, given that there was no payment of salary to the plaintiff as a PAYE employee, and that the very first step taken by the plaintiff was to issue an invoice for the first pay period (the balance of May 2015) and request to be paid as a contractor, a request to which QRU agreed.231

[154] I conclude, therefore, that despite the plaintiff’s signature on the employment contract, the parties had not, either by their conduct or intention, entered into a binding and operative agreement consistent with the terms of that employee contract.232

[155] It is then necessary to consider the first contractor agreement, signed by Mr Connolly on a date after 2 June 2015, which was when it was went to Mr Connolly by Mr Cordingley.233 This contract was not signed by Jim Carmichael.

[156] Mr Connolly gave evidence that after signing and returning the first contract agreement, he contacted Mr Selwood and said “you have to get the whiteout out because that wasn’t what I agreed to [a reference to the termination provisions of the first contractor agreement]. Get Jim [Carmichael] to initial it”.234

[157] Although Mr Selwood denied that conversation,235 he gave evidence that after a subsequent conversation with Jim Carmichael, he (Mr Selwood) was told that Mr Connolly had been given a 60 day termination clause in his contract rather than 30 days.236 Mr Selwood then arranged for a “soft copy of the first contract” to be sent to him by Ms Newman, in which he adjusted the termination provision and forwarded this second contractor agreement to Mr Connolly attached to an email dated 9 July 2015.237 Again, on balance, I accept that Mr Connolly had the telephone conversation with Mr Selwood referred to in paragraph 156.

[158] In respect of the first contractor agreement, as a result of the failure of QRU to execute that agreement, thus failing to comply with the provisions of cl 7.1238 and given that a second contractors agreement was prepared (clearly indicating that the parties did not intend to be bound by the first contractor’s agreement), I conclude that Mr Connolly was not bound by the first contractor agreement.

230 T2-54. 231 Exhibit 7; T2-44 (Ashley Selwood). 232 Exhibit 1 pp. 71-74. 233 Exhibit 1 pp. 38-45. 234 T1-27. 235 T2-45. 236 T2-33. 237 Exhibit 1 p. 64; T2-34 – T2-35. 238 “This agreement starts on the date it is signed by both parties and continues to the term as specified in Item 2 of the SOW [Statement of Work], unless it is terminated in accordance with this cl 7”; Exhibit 1 p. 78.

[159] In respect of the second contractor agreement,239 it is sufficient to identify that this agreement was signed by Jim Carmichael (although not witnessed or dated), but was never executed by Mr Connolly. It is clear that this contract never became binding in any way on either Mr Connolly or the QRU, either by conduct, intention or the signature of both parties.

[160] It follows from the conclusions I have reached that the contract between Mr Connolly and QRU was an oral contract which did not incorporate the termination provisions of either the QRU employment contract,240 the first contractor agreement241 or the second contractor agreement.242 I conclude, therefore, that there was no termination provision operative in respect of the oral contract between Mr Connolly and QRU.

[161] I find that the terms of the contract between Mr Connolly and the QRU were that Mr Connolly was to be paid $3000 per week, commencing 11 May 2015 and concluding 15 July 2016 (the conclusion of the Super Rugby season for the Queensland Reds in 2016 was 15 July, 2016).243

3. The consequences of the plaintiff’s termination on 27 July 2015.

[162] As a result of a review of the organisation following the 2015 Super Rugby season,244 Mr Connolly was told at a meeting with Mr Carmichael on 22 July 2015 that his services were terminated. When Mr Connolly raised in that meeting that there was an agreement with Mr McCall, Mr Carmichael agreed to check with Mr McCall.245

[163] At a subsequent meeting on 27 July 2015, on Mr Connolly’s version Mr Carmichael said that Mr McCall had agreed to the end of next season (i.e. 2016) but that QRU had changed its mind.246 Mr Carmichael denied that he told Mr Connolly he had spoken to Mr McCall who did agree to the two seasons, but there had been a change of mind by QRU.247 However, both Mr Carmichael248 and Mr Connolly249 agreed that there was no discussion about a notice period. In any event, Mr Connolly did not return to work at QRU after 27 July 2015.

[164] Mr Carmichael drafted and prepared a termination letter dated 28 July 2015250 and Mr Connolly recalls receiving this letter but was unable to say when he received the

239 Exhibit 1 pp. 81-87. 240 Exhibit 1 p. 71, which provides that “a 60 day termination notice period by either party or otherwise a period that is mutually agreeable by both parties”, and Exhibit 1 p. 73. 241 Exhibit 1 p. 78, paras 7.2 & 7.3.; “QRU may terminate this agreement with immediate effect by giving 30 days notice”. 242 Exhibit 1 p. 84, para 7.3.; “either party may terminate this agreement with immediate effect by giving 60 days notice or otherwise a period that is mutually agreed by both parties”. 243 Email from Mr Hastie QC (on behalf of the defendant) to Associate Dearden and Mr Hackett (on behalf of the plaintiff) dated 21 August, 2017. 244 T1-29. 245 T1-30; T2-65. 246 T1-33 – T1-34. 247 T2-83. 248 T2-83. 249 T1-31. 250 T2-84; Exhibit 1 p. 67.

letter, although he was clear that it was not given to him at the meeting on 27 July 2015.251 Although the termination letter states that “the QRU is exercising the 60 day termination clause within your agreement as at 30 July 2015”,252 Mr Connolly was not paid past the end of July 2015, nor did he perform any services for QRU after 27 July 2015.

Summary

[165] I find that an oral contract was entered between Rod McCall (who acted with authority on behalf of QRU) and John Connolly on 9 May, 2015.

[166] That oral contract was not replaced or subsumed by the QRU employee contract, the first QRU contractor’s agreement, or the second QRU contractor’s agreement.

[167] That oral contract did not contain any termination provision, express or inferred.

Conclusion

[168] I conclude that QRU repudiated the oral contract with Mr Connolly of 9 May, 2015 and that the plaintiff as a consequence suffered loss and damage. The repudiation of the contract was accepted by Mr Connolly through his legal representatives in correspondence dated 18 August 2015.253

[169] The plaintiff seeks payment of the sum of $159,000, calculated at $3000 per week from 1 August 2015 to 7 August 2016.

[170] Having concluded, on the evidence, that there was an oral agreement between Mr Connolly and the QRU, to be paid $3000 per week for his services commencing 11 May 2015 and concluding at the end of the 2016 Super Rugby seasons (a date now identified by agreement as 15 July, 2016), and in the absence of any termination provision in respect of that agreement, it follows that the plaintiff is entitled to judgment against the defendant for the sum of $150,000 (calculated at $3,000 x 50 weeks). I indicate, for completeness, that having concluded none of the three relevant documents (QRU employee contract, first QRU contractor’s agreement and second QRU contractor’s agreement) was operative, there is no basis to conclude that the term should be extended to one week after the end of the 2016 Super Rugby season.

Order

[171] I order that the defendant, Queensland Rugby Union Ltd, pay the plaintiff, John Connolly, the sum of $150,000.

Interest and costs

[172] I will hear the parties on the issue of interest, and costs.

251 T1-31. 252 Exhibit 1 p. 67. 253 Exhibit 1 p. 68.