Maloney v P and J Holdings Pty Limited

[1996] IRCA 411

DECISION NO: 411/96

IN THE INDUSTRIAL RELATIONS COURT
OF AUSTRALIA

AUSTRALIAN CAPITAL TERRITORY
DISTRICT REGISTRY                 No.   AI  1291 of 1996

STEVE JOHN MALONEY
Applicant

P. & J. HOLDINGS PTY LIMITED trading as BELCONNEN SMASH REPAIRS
Respondent

Coram:         Judicial Registrar Linkenbagh
Place:            Canberra
Date:            23 August 1996

REASONS FOR JUDGMENT

(Delivered ex tempore and revised from the transcript)

This is an application pursuant to the provisions of Section 170EA of the Industrial Relations Act 1988, in which the applicant seeks a remedy arising out of the termination of his employment. The applicant was employed by the respondent as the Manager of its smash repair business at Belconnen, in the Australian Capital Territory, between May of 1980 and 21 April 1995.

The decision for the employment to come to an end came about at a meeting, which was held on 21 March 1995, between the applicant, on the one hand, and Mr Rankin, on the other.  Mr Rankin is the effective controller of the respondent Corporation.  It is common ground between the parties that the applicant was good at his job and that he had not been the subject of any critical comment or action whatsoever, by the respondent, during the course of his employment, except for the matters evidenced by the material before me today concerning discussions, between Mr Maloney and Mr Rankin, about the taking of a lunch break by the applicant.  I will return to that later in these reasons. 

The primary question before the Court today is whether or not there was, in all of the circumstances, on the evidence, a termination of this employment relationship at the initiative of the employer.  The principle, upon which the Court considers that question have been espoused by the Court in numerous judgments.  The Court has said that the actions of the respondent, the employer, must be the primary or real cause of the termination of the employment.

In this case the employment came to an end in the course of a meeting at which there were two persons present.  The applicant, on the one hand, says that that meeting was held at the request of Mr Rankin in his office, and that during the meeting Mr Rankin said, "You and I are not seeing eye to eye.  The best thing to do is for us to part company."  The applicant told the Court that the parties then agreed that the applicant would work out a four week notice period. The applicant's evidence was that he was stunned by the words of Mr Rankin, and that he asked him, "Is that right?" and Mr Rankin said, "Yes".

The applicant's version of the conversation is that there was then some discussion about the entitlements that he would receive on termination and to the effect that the respondent was not in a position to pay all the moneys that would be due to the applicant in a lump sum, and that there was an agreement for payment of that amount by instalments.

Mr Rankin's version of the conversation was that the applicant indicated that he wished to resign and that he was giving four weeks notice and that Mr Rankin accepted the oral resignation.  Mr Rankin agrees that there was discussion and agreement about the payment of entitlements by instalments. Both men agree that the conversation was one which did not involve any animosity.  Mr Rankin's evidence was that the conversation was not in the nature of a formal counselling session or anything along those lines, because there was no need for that, there having been no conduct on the part of the applicant which gave rise to such a need.  Mr Rankin told the Court that he was not surprised that the applicant tendered his resignation because, in Mr Rankin's view, the applicant had given the impression to Mr Rankin for some time prior to the date of the meeting, that he had had enough of what Mr Rankin described as "the game".  The two versions of the conversation cannot both be believed.

There were other conversations between the applicant and Mr Rankin concerning the issue of the applicant’s taking his lunch break, which could be described in the same way.  Both the applicant and Mr Rankin mentioned in their evidence occasions, the dates of which are vague and not of great significance, on which, from the applicant's perspective, Mr Rankin instructed him to inform Mr Rankin at 8.30 each morning as to the time of day at which he would be taking his lunch break.  The applicant, having that perception, saw it as something of an imposition on him, and unnecessary, because on his evidence there had been an agreement reached with Mr Rankin and another member of the staff that the applicant would take his lunch break at 12.30 each day. Mr Rankin's perception of the conversations regarding the lunch break issue, was that he was minded to ensure that at any time during the day either he or the applicant was present on the premises for the purpose of giving Quotes to customers for work to be done on the customer's vehicles.  Mr Rankin's view was that he needed to know if the applicant was going to be going off the premises at lunch time so that, in effect, he could ensure that he was there to cover the possibility that a Quote might be requested while the applicant was absent on his lunch break.  As I have said, the perceptions of the two players of the conversations regarding the lunch breaks are quite different.  The applicant's case is that the issue relating to the lunch breaks was in effect the cause of Mr Rankin’s forming the view that he was to terminate the employment of the applicant.  Mr Rankin says that the lunch break issue was not grounds for dismissal and was never, in fact, seen by him in that light.

Mr Rankin also said in his evidence, that he was aware, because of documentation he had received from the Motor Traders Association, that there were procedures which it was advisable to follow if one was to set about terminating the employment of an employee.  He said that had he perceived a need to terminate the employment of the applicant then he would have followed the guidelines and he gave evidence as to his understanding of those guidelines, which was basic but very comprehensive.

The evidence also indicates the attitude of the applicant towards his employment and his employer.  The evidence of Mrs Rankin was that the applicant had spoken about resigning on many previous occasions.  Mr Rankin gave evidence in a similar vein that the applicant had, on occasions, in discussions to do with the lunch break issue, indicated that he would tender, or had offered, his resignation.  Mr Moroney gave evidence for the respondent. He is a fellow employee.  He told the Court that the applicant said to him on about 20 April 1995, "I've had a gutful of this place and it's time to move on."  Those parts of the evidence, together with what I have described as the lunch break issue are indicative of an attitude on the part of the applicant which is relevant to my assessment of the evidence generally in these proceedings. 

It is always a difficult task for the Court to decide which of two conflicting versions of conversations should be believed.  I have had the opportunity to observe both the applicant and Mr Rankin giving evidence for some time in the witness box, and I would not be comfortable with making any finding adverse to the credit of either of them which was based simply on their recollections of the conversations.  I can, however, obtain assistance from other evidence in my assessment of the credit of witnesses and my assessment of which version of the conversations, particularly the one on 21 March, is the more believable.  In that regard I note that there is no evidence of any animosity between the applicant and Mr Rankin at the time of the conversation on 21 March or thereafter.  In fact, the applicant's evidence was that his relationship with Mr Rankin improved after 21 March and before he left the workplace on 21 April.  There is no evidence that the applicant raised any objection to Mr Rankin in opposition to the purported termination of his employment by Mr Rankin.  The applicant agreed to receive payment of moneys due to him in satisfaction of his Annual Leave and Long Service Leave, and other entitlements, of $8876 by instalments after he left the workplace.  Such a degree of trust could be seen to be unusual, to say the least, if the circumstances were that, in fact, the employment had been brought to an end against the wishes of the applicant. 

I note that the applicant worked out the period of notice and, as I have said, his own evidence was that his relationship with Mr Rankin improved during that time.  Mr Rankin's evidence was that he had no concerns about applicant’s working during his period of notice, and that would certainly be unusual in my opinion,if, in fact, Mr Rankin had caused the employment to come to an end.  Further, on the last day that the applicant worked, Mr Rankin took him to lunch and the applicant attended a drinks function at the workplace at the conclusion of the working day, and after that he gave Mr Rankin a lift home.

Those facts are hardly consistent with the applicant’s having been sacked by Mr Rankin.  I further note that the applicant took his work vehicle home after he finished work on the last day and he was trusted by Mr Rankin to arrange for the delivery of the vehicle to another employee on the following morning.  Similarly, the applicant remained in possession of his keys to the work place for some time after 21 April 1995.  Another factor which in my view works against acceptance of the applicant's assertion that his employment was terminated by the employer, is that there was a considerable delay between the time the employment came to an end, at the meeting on 21 March 1995, and the filing of the application in these proceedings, on 22 September 1995.

Such a delay, in itself, does not raise any presumption of what might be seen as a weakness in the case of the applicant, but taken with the other matters to which I have referred, and the reasons advanced by the applicant in his evidence for the delay in the filing of his application, the delay assumes some greater significance.  The applicant's evidence as to the reasons for delay, was that his de facto wife was not well and that he, effectively, had other things on his mind.  He also said that he resolved to commence the proceedings only after he had not received a reference from his employer and after some time had elapsed, and also after it became apparent to him that he was not to receive payment of a bonus, to which he asserts he had become entitled.

In relation to the bonus, the applicant asserts that he became entitled to that bonus, which was to be an air ticket to the United States and $1000 spending money, in about 1984, but that he had not taken advantage of the bonus in that time.  Both Mr and Mrs Rankin gave evidence to the effect that there was no agreement for the taking of a bonus and that no bonus schemes were in place.  I particularly note the manner in which Mrs Rankin responded to questions in that regard and it is my finding that, in fact, there was no bonus scheme and there is certainly insufficient evidence to satisfy me that the applicant had an entitlement to a bonus along the lines described by him.

In relation to the reference, the applicant asked for a reference at the time of the termination of his employment and it was not, and has not been, forthcoming.  Mr Rankin's evidence was that he was expecting a letter from the applicant confirming the resignation.  The applicant, of course, does not agree with that because he says he did not resign.  Mr Rankin was awaiting the letter of resignation and his evidence was that he trusted the applicant to provide the letter to him in the fullness of time.  By September 1995 when these proceedings were commenced, neither the letter of resignation nor the reference had been provided by one party to the other.  Mr Rankin then resolved that he was not going to provide the reference because the proceedings had been commenced.  And he was certainly not going to provide the reference unless he received the letter of resignation, which of course, he was not going to receive because the applicant had commenced these proceedings and had formed the view that his employment had been terminated at the initiative of Mr Rankin.

I find that the applicant's actions and the facts that can be established by independent evidence are inconsistent with the applicant's version of the conversation on 21 March.  And, considering the evidence as a whole, I am satisfied that that conversation was along the lines related to the Court by Mr Rankin.  I therefore find that the applicant resigned from his employment on 21 March 1995.

I should say something of the evidence of the witnesses Mr Robson and Miss Tipping who were called for the applicant.  Both of those witnesses gave their evidence in a forthright and honest way.  Mr Robson related a conversation that he had with Mr Rankin on 3 March 1995.  Mr Robson could not remember the precise terms of the conversation and that is understandable.  He told the Court that it was to the effect of Mr Rankin saying that he was getting rid of Steve, being the applicant, or that Steve would be going from the business.  Mr Robson's evidence is equivocal, in my view.  It is consistent with Mr Rankin's evidence that the applicant had tendered his resignation from time to time but is inconclusive to be of any real assistance to me in determining the issue that I must determine today.  Miss Tipping gave evidence of a conversation that she had with another employee of the respondent in December of 1995.  That conversation is remote in time from the termination of the employment and occurred after these proceedings were commenced.  Miss Tipping said that the other employee had said words to her to the effect that the respondent wished to have her swear an affidavit that the applicant had resigned and not been sacked, because the respondent had gone about the dismissal of the applicant in the wrong way.  I am reluctant to place any weight at all on that evidence for the reasons that I have given.  And I prefer to rely on the evidence of the facts and conduct of the parties which is contemporaneous with the termination of the employment. 

The witnesses for the respondent, apart from Mr Rankin, being Mrs Rankin and Mr Moroney, both gave evidence of contemporaneous events.  Mrs Rankin told the Court that on 21 March, after the meeting between the applicant and her husband, the applicant left her husband's office and she went in and asked her husband what had happened.  She told the Court that she was told by her husband that the applicant had resigned and that he would work out his notice, and she made arrangements with her husband to work out how much would be due to the applicant for his leave entitlements.  That evidence of Mrs Rankin is consistent with Mr Rankin's version of the conversation that he had with the applicant.  Mr Moroney's evidence is of significance.  I have already quoted a part of it.  The full evidence given by Mr Moroney, from which I have taken the extract, was that he said to the applicant on 20 April, "They tell me you've resigned."  And that the applicant replied, "Yes. I've had a gutful of this place and Rankin.  It's time to move on."  Mr Moroney said that his conversation with the applicant continued on with some discussion about the applicant's future plans which involved going “up north”. 

Overall, I am satisfied, as I have said, that the termination of this employment cannot be categorised as a termination at the initiative of the employer.  It is necessary for the applicant to satisfy me on that question before he can proceed any further to obtain a remedy in the proceedings, and as I am not satisfied, the consequence is that the application be dismissed and I so order.

There is an application for costs by the respondent.  The Court may order that costs be paid pursuant to the provisions of Section 347 of the Act. An order for costs cannot be made unless the Court is satisfied that the applicant instituted the proceedings vexatiously or without reasonable cause and those are the words of the Section.  The Court has amplified the meaning of those words to require that the Court must be satisfied that before an order for costs is made the applicant had what might be described as "not an arguable case". 

In this matter, the finding of the Court is that there was no termination of the employment within the meaning of the Act and that finding is based on a finding that the applicant resigned from his employment.  In those circumstances, it is difficult to see how the applicant can later assert that he has an arguable case.  I propose to make an order for costs and I will not add further to my reasons for that but say that on any objective test the case for the applicant at the time of institution of these proceedings, which was 22 September 1995, there was no reasonable prospect of success in the application.  It may well have been that the applicant at that stage, from his perception, believed that his employment had been unfairly terminated. However, the test is not a subjective one but an objective one and applying the objective test, I find that the provisions of Section 347 are satisfied.  The mode of calculation of costs is set out in Order 62 of the Industrial Relations Court Rules.  I prefer the alternative in Order 62, Rule 1(b), that is, to specify an amount of costs.  I am still in my other life, a practising Solicitor, and assessments and taxation of costs fill me with fear and dread as they do any legal practitioner.  It simplifies matters for everybody if an amount can be specified in the Order, rather than my specifying a scale or imposing on the District Registrar the task of a taxation.  I also wish to minimise further costs.

The Court orders:

1. That the application is dismissed.

2. That the applicant pay the respondent's cost in the proceedings.

3. That the matter be listed for mention on 5 September 1996, at 9.30 am, as to the mode of assessment of costs.  I excuse the parties from personal attendance on 5 September 1996, if a form of written orders to be made by consent on 5 September is submitted to the Registrar prior to 5 September 1996.

I certify that this and the preceding 6 pages are a true copy of the Reasons for Judgment of Judicial Registrar Linkenbagh

Associate:     C M Joyce
Date:              9 September 1996

Solicitor for the Applicant:  Mr.W. Baxter

Scott Shiels and Glover

Solicitor for the Respondent:        Mr J Parkinson
  Wood Fussell