Brennan v Kangaroo Island Council

The appeal concerned a dispute between Ms Brennan and the Kangaroo Island Council regarding the termination of her employment. Ms Brennan contended that her contract of employment should have included an implied term entitling her to reasonable notice of termination, arguing that twelve months' notice should have been provided. The Council, on the other hand, had made payments based on a formula stipulated in the relevant industrial award, which calculated severance based on age and length of service. The trial judge had found that this formula was not correctly applied and ordered additional payment equivalent to one week's remuneration. The appeal was heard by Vanstone, Anderson, and Parker JJ of the court.

The central legal issue before the court was whether a term requiring reasonable notice of termination could be implied into Ms Brennan's contract of employment, notwithstanding that the applicable industrial award provided a specific mechanism for calculating notice or severance payments. This involved considering whether such an implied term was necessary for business efficacy or so obvious as to go without saying, particularly in light of the existing award provisions which operated independently of the contract. The court also had to determine if there was sufficient evidence to establish a custom and practice in local government that would support the implication of such a term.

The court reasoned that an implied term must be reasonable and equitable, necessary for business efficacy, obvious, capable of clear expression, and not contradict express terms. It found that the implication of a reasonable notice term was not necessary to give business efficacy to the contract because the employment arrangement was already effective due to the existence of the award provisions. Furthermore, the presence of the award provision meant that implying a term for reasonable notice was not so obvious as to "go without saying" for the contracting parties. The court also noted that no evidence was led to establish a custom and practice supporting such an implication. Consequently, the appeal was dismissed.