Background
Brendan Kelly and Kathleen Stone were colleagues at Services Australia (formerly the Department of Human Services). Mr Kelly had previously supervised Ms Stone and had been required to manage her performance. On or around 21 July 2016, Mr Kelly observed Ms Stone and another colleague viewing an image on a computer screen. Ms Stone asked whether she could send Mr Kelly the image, and he reluctantly agreed. Ms Stone then sent him 15 text messages, each containing a vulgar image — most featuring sexual organs, sexual acts or practices, and commentary that Mr Kelly found homophobic. After consulting the Urban Dictionary to decipher some of the images, Mr Kelly described feeling “disgusted,” and the material as “confronting, distressing and offensive.”
Mr Kelly lodged a complaint with the Australian Human Rights Commission on 7 November 2018, alleging sexual harassment under the Sex Discrimination Act 1984 (Cth) (SDA) against Ms Stone, as well as other claims against the Commonwealth and a third respondent, Peter Kowal. The matter was eventually brought to the Federal Court under s 46PO of the Australian Human Rights Commission Act 1986 (Cth). The case had a long procedural history, detailed in Kelly (No 2) [2025] FCA 736. By the time of the June 2026 hearing, the claims against the Commonwealth and Mr Kowal had settled in principle. Ms Stone, whose lawyers had ceased acting for her in May 2026 after losing contact with her in late 2025, did not appear.
Justice Kennett ordered that liability issues be determined separately from remedy. The Court proceeded against Ms Stone in her absence under r 30.21(1)(b)(i) of the Federal Court Rules 2011 (Cth), having been satisfied that thorough attempts — including a subpoena — had been made to locate and notify her of the hearing.
The Court’s Holding
Justice Kennett held that Ms Stone’s conduct constituted sexual harassment within the meaning of s 28A(1) of the SDA and that she had contravened s 28B(2), which makes it unlawful for an employee to sexually harass a fellow employee. The images were “conduct of a sexual nature” given their content. The Court accepted, on Mr Kelly’s unchallenged affidavit evidence, that the conduct was “unwelcome”: he had agreed only to receive one image and did so reluctantly, not all 15.
The dispositive question was objective: whether a reasonable person, having regard to all the circumstances listed in s 28A(1A), would have “anticipated the possibility” that Mr Kelly would be offended, humiliated or intimidated. The Court identified three material circumstances. First, Mr Kelly is sexually oriented towards men, and the images were largely homophobic — a reasonable person sending such material would at minimum anticipate the possibility that the recipient could be homosexual. Second, Mr Kelly suffered from ADHD, a condition that may affect his reaction to distressing material and which a reasonable person would be assumed potentially to be aware of. Third, the parties shared an uncomfortable workplace relationship, including a prior supervisory dynamic, such that receiving vulgar sexual content from Ms Stone at work would have been particularly uncomfortable for Mr Kelly regardless of sexual orientation.
Taking all circumstances together, the Court was satisfied the objective test was met and answered “yes” to the separate question whether Ms Stone is liable to orders under s 46PO(4) of the AHRC Act by reason of contravening s 28B(2) of the SDA. Questions of remedy, penalty, declaratory relief, and costs were reserved for a later stage.
Key Takeaways
- Sending a series of vulgar, sexually explicit, and homophobic images to a work colleague via text message can constitute “conduct of a sexual nature” amounting to sexual harassment under s 28A of the SDA even where the initial transmission was nominally consented to, if that consent was reluctant and did not extend to the full volume or nature of the material sent.
- The “unwelcomeness” inquiry focuses on the subjective state of mind of the person harassed at the time, while the reasonable-person anticipation test under s 28A(1) is objective — courts will consider the harassed person’s sexual orientation, disability, and relationship with the alleged harasser as relevant circumstances under s 28A(1A).
- A court may proceed to determine liability against an absent respondent where it is satisfied that thorough steps — including attempted service of a subpoena — have been taken to inform that respondent of the hearing.
- Individual employees, not just their employers, can be found liable for sexual harassment under s 28B(2) of the SDA and exposed to orders under the AHRC Act.
Why It Matters
This decision reinforces that workplace sexual harassment liability under the SDA extends to individual co-workers, not merely employing organisations, and that courts will construe the “anticipated the possibility” standard broadly when the nature of the material is patently vulgar or demeaning. The ruling is a practical reminder that sending explicit or sexually charged content to a colleague — even framed as humour — carries real legal risk for the individual sender, particularly where the content is homophobic or otherwise targeted at characteristics the recipient may possess.
The case also illustrates the procedural consequences for a respondent who becomes uncontactable: the Court proceeded in Ms Stone’s complete absence, accepting Mr Kelly’s unchallenged evidence, and found against her on liability. With remedy and declaratory relief still to be determined, the ultimate financial and reputational exposure for Ms Stone remains open — a cautionary outcome for any party who disengages from litigation.