Queensland Ambulance Service and Suncorp Insurance, Commission v Sanchez

[1992] QCA 353

IN THE COURT OF APPEAL	[1992] QCA 353
QUEENSLAND	Appeal No.206 of 1992
Before the Court of Appeal

The President
Mr Justice McPherson

Justice White

BETWEEN:

THE COMMISSIONER OF THE

QUEENSLAND AMBULANCE SERVICE

(First Defendant) First Appellant

AND:

SUNCORP INSURANCE AND FINANCE

(Second Defendant) Second Appellant

AND:

FRANK SANCHEZ

(Plaintiff) Respondent

JUDGMENT OF THE COURT

Delivered the sixteenth day of October, 1992

This is an appeal from a judgment given in the District Court at Brisbane on 27 August 1992 whereby the respondent recovered $106,956.86, inclusive of interest to the date of judgment, together with further interest from judgment at the rate of 13% per annum, and the appellants were ordered to pay the respondent his costs of and incidental to the action. According to the appellants, the respondent was only entitled to $1,392.80 with interest thereon pursuant to the Common Law Practice Act 1867 as amended. The parties have agreed that, following the determination of this appeal, they will have a period of 7 days within which to make written submissions as to costs.

The respondent is a former ambulance officer and the appellants are collectively responsible for the administration of the Queensland Ambulance Service Superannuation Scheme; the first appellant is the trustee of the Scheme and the second appellant has issued a policy for the provision of benefits to the members of the Scheme. There is some doubt concerning the exact identity of the respondent's employer at material times, but it seems that neither appellant was the employer.

The present dispute relates to the amount of the benefits to which the respondent is entitled under the Superannuation Scheme. The appellants acknowledge that the respondent is entitled to "the unpaid balance of the total accumulation as at 27 October 1989 in his Member's Account", that being the date upon which they assert that his employment terminated, while the respondent contends, and the primary judge held, that he is entitled to be paid benefits on the basis that his employment was terminated on 2 April 1990 as a result of his becoming totally and permanently disabled.

It is unnecessary to set out the documentary provisions in detail. It is common ground that, if the judgment in favour of the respondent is to be upheld, his "service" must have been "terminated" on 2nd April 1990 "by reason of his

...

(ii) having been absent from employment .... for six (6) consecutive months as a result of physical or mental incapacity which is caused by injury, accident, illness or disease ...".

The appellants accept that the respondent was absent from his employment for six consecutive months prior to 2 April 1990 and that his physical incapacity caused by illness or disease would have prevented him from working as an ambulance officer during that period but argue that his employment had earlier terminated on 27 October 1989.

The respondent last attended work on 28 September, 1989, by which time he had become ill. By letter dated 4 October, he was suspended from duty to take effect from the expiration of his sick leave entitlement on 9 October. The suspension was not related to his sickness but to alleged misconduct, incompetence and inefficiency, and the letter required him to attend before a tribunal on 24 October.

The respondent did not attend before the tribunal. On that day, his doctor informed him that he had been diagnosed as being HIV positive.

On 27 October, the respondent's employer gave him notice of immediate dismissal, although arguably he was entitled to a week's notice. The dismissal was related to his alleged conduct and performance, not his illness.

The respondent appealed against his dismissal, pursuant to the Ambulance Services Act 1967: see sub-s.30(2) and Schedule 6 sub-clause 19(3). Shortly stated, the Appeal Board had power when it determined the appeal (i) to confirm the decision to dismiss the respondent, ie, its effectiveness as a termination of the respondent's services on 27 October, (ii) to set aside the decision, in which case the respondent's services would presumably have continued uninterrupted without any need for reinstatement or re- employment, or (iii) to vary the initial decision of dismissal, perhaps by substituting a different commencement date for the termination of the respondent's services or by substituting a different form of punishment. However, the course which the Appeal Board would or should have taken if the appeal had been heard,

remains unknown. The Appeal Board hearing was set for 2 April 1990 but, on that day the respondent and his employer resolved the matter prior to the hearing and made an agreement in the following terms:

"I, FRANK SANCHEZ, hereby tender my resignation from employment with the Queensland Ambulance Transport Brigade, Boonah Committee, effective from 27 October 1989, due to medical reasons.

I further state that if this resignation is accepted by the Committee, I will withdraw my appeal against my dismissal and undertake not to proceed in the matter in any way whatsoever.

I further acknowledge that with the acceptance of my resignation, I will neither have nor make any claim on the Boonah Committee for any form of remuneration, other than what I have already received subsequent to my termination of employment on 27 October, 1989.

Signed ... [Frank Sanchez]

Dated 2.4.90

Witnessed ...

Resignation Accepted ... [Chairman]
Queensland Ambulance Transport Brigade Boonah
Committee,
Date 2/4/90
Witnessed ... ."

It was argued for the respondent that the peremptory termination of the respondent's services on 27 October 1989 was at least prima facie wrongful, and it was pointed out that the primary judge considered that the respondent had had reasonable prospects of success before the Appeal Board. In the course of argument, counsel drew attention to the change which has occurred in judicial attitudes with respect to employment contracts: see, for example, Gunton v.

Richmond-upon-Thames London Borough Council (1981) 1 Ch. 448; 1 WLR 28; and Turner v. Australasian Coal and Shale Employees Federation (1984) 55 ALR 635. However, it is tolerably clear that after his employer gave him notice of dismissal on 27 October 1989 the respondent's further right to provide services to his employer was dependent on either a favourable decision of the Appeal Board in the appeal which he instituted or if the employer could be induced to retract the discharge: cf Automatic Fire Sprinklers Pty. Ltd. v. Watson (1946) 72 CLR 435, 465-66. Since the respondent and his employer elected not to proceed with the Appeal Board hearing, the respondents' case that his services were not terminated on 27 September depends on the agreement of 2 April 1990.

One implication of the agreement that day between the respondent and his employer is that the respondent was not dismissed on 27 October, 1989 or at all. Since there was no basis other than dismissal for the termination of the respondent's services on that day, it might be asserted that his services were not terminated then and, because there is

no suggestion that his services were terminated in the

interim, that they must have continued until 2 April 1990.

This was essentially the view of the primary judge, who

said:

"My view is that the date of "termination" was 2nd April, 1989, and that the purported backdating is a kind of fiction, the precise date assigned being of little significance, except that, in this case, the Boonah Committee is given some protection against the making of claims for wages and the like in respect of any period after 27 October, 1989. In my view, the dismissal (Mr Sanchez' challenge to which would seem to me to have had reasonable prospects of success) was withdrawn and what replaced it was a resignation which was not attempted and cannot properly, in the circumstances, be regarded as having happened before 2nd April, 1990, whatever conditions were attached to it by reference to earlier dates."

However, such an approach isolates one aspect of the agreement between the respondent and his employer and elevates it to a predominant position in their bargain which it does not correctly occupy. Their essential agreement was to confirm that the respondent's services had been terminated on 27 October 1989 but to adopt a different, mutually satisfactory explanation for that event; namely, resignation by the respondent for medical reasons rather than dismissal.

The litigation before the Appeal Board was therefore compromised on terms which acknowledged that the respondent's services had been terminated on 27 October 1989, and the circumstances attending that compromise raise no doubt that it was a valid and binding contract between the respondent and his employer. As between those parties, the matters which they agreed operate as conventional estoppels.

While the estoppels between the respondent and his employer might not bind the parties to these proceedings, there was no full investigation of the efficacy of the termination of the respondent's services on 27 October 1989 between the present parties in these proceedings and this litigation was conducted on the basis that the rights and obligations of the respondent and appellants fall to be determined by reference to the position between the respondent and his employer, including their transaction on 2 April 1990. No attempt was made to seek to establish a different date for the termination of the respondent's services for the purposes of these proceedings from that which is operative as between the respondent and his employer.

In the circumstances, it was not established for the respondent that, despite his agreement with his employer on 2 April 1990 that his services had terminated on 27 October 1989, in fact the respondent's services with his employer did not terminate until 2 April 1990.

Accordingly, the appeal succeeds and the judgment below should be set aside. In lieu thereof, judgment is entered for the respondent for the sum of $1,392.80. As agreed at the hearing, the parties have seven days in which to make written submissions concerning costs both in this court and in the court below.

IN THE COURT OF APPEAL

QUEENSLAND	Appeal No.206 of 1992
BETWEEN:

THE COMMISSIONER OF THE

QUEENSLAND AMBULANCE SERVICE

(First Defendant) First Appellant

AND:

SUNCORP INSURANCE AND FINANCE

(Second Defendant) Second Appellant

AND:

FRANK SANCHEZ

(Plaintiff) Respondent

The President
Mr Justice McPherson

Justice White

Judgment of the Court delivered the
sixteenth day of October, 1992

APPEAL ALLOWED. JUDGMENT BELOW SET ASIDE AND IN LIEU THEREOF JUDGMENT ENTERED FOR THE RESPONDENT FOR THE SUM OF $1,392.80. PARTIES HAVE SEVEN DAYS TO MAKE WRITTEN SUBMISSIONS CONCERNING COSTS BOTH IN THIS COURT AND IN THE COURT BELOW.

IN THE COURT OF APPEAL

QUEENSLAND	Appeal No.206 of 1992
Before the Court of Appeal

The President
Mr Justice McPherson

Justice White

BETWEEN:

THE COMMISSIONER OF THE

QUEENSLAND AMBULANCE SERVICE

(First Defendant) First Appellant

AND:

SUNCORP INSURANCE AND FINANCE

(Second Defendant) Second Appellant

AND:

FRANK SANCHEZ

(Plaintiff) Respondent

JUDGMENT OF THE COURT

Delivered the sixteenth day of October, 1992

MINUTE OF ORDER:	APPEAL ALLOWED. JUDGMENT BELOW SET ASIDE AND IN LIEU THEREOF JUDGMENT ENTERED FOR THE RESPONDENT FOR THE SUM OF $1,392.80.
PARTIES HAVE SEVEN DAYS TO MAKE WRITTEN SUBMISSIONS CONCERNING COSTS BOTH IN THIS COURT AND IN THE COURT BELOW.
CATCHWORDS:	Contract. Construction and interpretation. Appeal from award in favour of respondent/former ambulance officer - whether respondent established that services terminated on date entitling him to award despite agreement with employer that services terminated on later date - whether agreement operates as an estoppel.
Counsel:	Ms. M.A. Wilson for the appellants
Mr S.C. Williams Q.C. and with him Mr D.H. Tait for the respondent
Solicitors:	Messrs. O'Mara Paterson & Perrier for the appellants
Messrs. Biggs and Biggs for the respondent
Date of Hearing:	6th October, 1992