Foster's Group Ltd v Wing - [2005] VSCA 322

SUPREME COURT OF VICTORIA

COURT OF APPEAL

No. 3784 of 2004

FOSTERS GROUP LIMITED (ACN 007 620 866)
	Appellant
v.
DAVID KOU TIEN WING	Respondent

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JUDGES:	MAXWELL, P., NETTLE, J.A. and HABERSBERGER, A.J.A.
WHERE HELD:	Melbourne
DATE OF HEARING:	17 November 2005
DATE OF JUDGMENT:	23 December 2005
MEDIUM NEUTRAL CITATION:	[2005] VSCA 322

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Employment – Employment agreement terminated by employer prior to expiry of term – Whether employee entitled to redundancy payment – Meaning of redundancy – Reorganisation both before and after employee's departure reduced responsibilities of his former role as General Manager of the appellant's business in China – Employee's position as General Manager filled in acting capacity for 17 months and then permanently – Role still retained important functions and duties – Held no redundancy.

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APPEARANCES:	Counsel	Solicitors
For the Appellant	Mr J.L. Bourke	Corrs Chambers Westgarth
For the Respondent	Mr R.R.S. Tracey Q.C. with Mr P.D. Burchardt	A.J. Macken & Co.

MAXWELL, P.

I agree with Habersberger’s A.J.A.’s reasons for judgment, and that the appeal should be allowed and the cross-appeal dismissed.

NETTLE, J.A.:

I agree with Habersberger,A.J.A., for the reasons which his Honour gives, that the appeal should be allowed and the cross-appeal should be dismissed.

HABERSBERGER, A.J.A.:

This is an appeal from a judgment in the County Court of Victoria in which the learned trial judge found that the plaintiff's employment with the defendant, Foster's Group Limited ("Foster's"), had been terminated because his position as General Manager, Shanghai Foster's Brewing Limited ("SFBL") had become redundant. His Honour found that under his contract of employment the redundancy entitled the plaintiff to payment of the sum of $89,984.21, to which interest of $22,443.66 was added. The defendant appealed against this finding. The plaintiff, Mr Kou, cross-appealed against the learned trial judge's calculation of the amount of the redundancy payment on the basis that the plaintiff's years of service with Foster's and entities related to Foster's prior to the commencement of his employment under his contract should have been taken into account.

The Factual Background

On 12 March 1995, the respondent commenced employment with Carlton and United Breweries Limited, a subsidiary of the appellant, as Deputy General Manager, Finance, at Tianjin Foster's Brewing Limited in the People's Republic of China. On 18 January 1999 the respondent was appointed by Foster's to the position of Deputy General Manager, Finance, SFBL. In neither of those positions did the plaintiff have any redundancy entitlement.

By a letter dated 25 February 2000, Foster's offered the respondent the position of General Manager, SFBL on a salary of HK$1,700,000.00 (approximatelyA$340,000) for a period of three years commencing on 1 July 2000. Mr Kou accepted the offer on 1 March 2000. Clause 1 of the employment contract under the sub-heading "Duties" described the duties of Mr Kou in the following terms:

"The General Manager shall manage the affairs of the Company, subject to the supervision and control of the Board of Directors, reporting to the Managing Director Foster's Asia."

Six months'…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Foster's Group Ltd v Wing

Details

AGLC: Foster's Group Ltd v Wing [2005] VSCA 322
Case: [2005] VSCA 322
Decision Date: 23 December 2005

CaseChat Overview and Summary

Foster's Group Ltd, the appellant, sought to determine whether it was required to pay a redundancy payment to its former employee, Wing, after terminating his employment agreement prior to its expiration. The primary dispute was whether the reduction in Wing's responsibilities due to a reorganisation of the company constituted redundancy as defined by employment law. The case was heard and determined by the High Court of Australia.

The central legal issue before the court was the interpretation of "redundancy" under the relevant employment legislation. Specifically, the court had to consider whether the reorganisation of the company's business in China, which occurred both before and after Wing's departure, resulted in the abolition of his position as General Manager. The court had to assess whether Wing's former role had been fundamentally altered to the extent that it could be considered redundant, and whether his position was filled by another person in an acting capacity or permanently.

In delivering the judgment, the court held that Wing was not entitled to a redundancy payment. The reorganisation did not result in the abolition of Wing's position. The court found that the role of General Manager still retained important functions and duties, even after the reorganisation. The fact that the role was temporarily filled in an acting capacity and later permanently did not change the fundamental nature of the position. Consequently, the court determined that the changes did not amount to a redundancy.

The court's decision was grounded in the statutory definition of redundancy and the factual circumstances of the reorganisation. The court found that there was no redundancy, and therefore, Foster's Group Ltd was not required to pay a redundancy payment to Wing.

Orders