Redman v Verticon Group Limited (No 2) - [2009] NSWDC 43

CITATION: Redman v Verticon Group Limited (No 2) [2009] NSWDC 43

HEARING DATE(S): 9 - 13 March 2009

JUDGMENT DATE:
2 April 2009

JURISDICTION: Civil

JUDGMENT OF: Goldring DCJ

DECISION: Verdict for the plaintiff in sum of $133,407

CATCHWORDS: EMPLOYMENT LAW - summary termination - 'wilful or serious misconduct' - meaning of 'wilful' - EMPLOYMENT LAW - condonation of breach of employment contract by employer - CONTRACT - Employment Contract - duty of employee summarily dismissed to mitigate damages

LEGISLATION CITED: Insurance Contracts Act 1984 (Cth)

CASES CITED: Blyth Chemicals v Bushnell (1933) 49 CLR 66
Shepherd v Felt and Textiles of Australia Ltd (1931) 45 CLR 359
Concut Pty Ltd v Worrell (2000) 75 ALJR 312
Rankin v Marine Power International Pty Ltd [2001]
VSC 150
Pastrycooks Employees, Biscuit Makers Employees and Flour and Sugar Goods Workers Union v Gartrell White [No 3] (1990) 35 IR 70
Bigg v NSW Police Service (1998) 80 IR 434
Briginshaw v Briginshaw (1938) 60 CLR 336
R v Galli [2001] NSWCCA 504
McDonald v Parnell Laboratories (Aust) Pty Ltd (2007) 168 IR 375
Cooper v Cooper (1941) 65 CLR 162
Byrne v Australian Airlines (1995) 131 ALR 422
Peter v Aradlay Insurance Brokers Pty Ltd [2005] NSWIRComm 253

PARTIES: Jason Redman (Plaintiff)
Verticon Group Limited (Defendant)

FILE NUMBER(S): 5716 of 2007

COUNSEL: J Berwick (Plaintiff)
T Saunders (Defendant)

SOLICITORS: Craddock Murray Neumann (Plaintiff)
Deacons (Defendant)

JUDGMENT

1 In this action Mr Jason Redman claims damages from the Verticon Group Limited for wages and bonuses, which he says, are due to him after he resigned from his position as General Manager for New South Wales for Verticon Group. Verticon Group says that Mr Redman was summarily dismissed for "serious misconduct", and as a result of that he was not entitled to avail himself of the dispute resolution procedures provided for in his employment agreement, and is not entitled to his wages, bonus and other damages.

2 The issue for decision is, primarily, whether the evidence discloses grounds upon which Verticon Group was entitled to find that there was "serious misconduct" on Mr Redman's part.

Mr Redman's employment agreement

3 Until 2005, Mr Redman, or rather a family trust controlled by him, operated a business through a company, Fire Up Cranes and Rigging Pty Ltd, which hired cranes and hoists. During its short life, the business of Fire Up had increased significantly, in large part as a result of Mr Redman’s efforts. In the middle of that year the then managing director of Verticon Group, Mr Mark Kevin, approached Mr Redman and offered to buy the shares in Fire Up for a price of $4 million. It would be a condition that Mr Redman would remain as managing director. As part of the agreement to transfer the shares, Mr Redman was required to execute an employment agreement. This agreement is in evidence. It is dated 1 September 2005. The agreement was originally between Fire Up and Mr Redman, and it is not in dispute…

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.

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Details

Case: [2009] NSWDC 43
Decision Date: 2 April 2009

CaseChat Overview and Summary

In the case of Redman v Verticon Group Limited (No 2), the dispute was between the plaintiff, Mr Redman, and the defendant, Verticon Group Limited. The primary issue was whether Mr Redman had been terminated from his employment in a manner that was fair and reasonable, specifically regarding the grounds of 'wilful or serious misconduct'. The case was heard by the Federal Circuit Court of Australia. The court was tasked with determining the meaning of 'wilful' in the context of employment termination and whether the employer had condoned a breach of the employment contract by continuing to pay the plaintiff's salary after the alleged misconduct.

The court considered whether the employer's conduct in paying the plaintiff's salary for some time after the termination constituted condonation of the breach of the employment contract. The plaintiff argued that this payment implied that the employer accepted that the misconduct did not warrant termination. The court found that the employer's actions did amount to condonation and that this fact was relevant in determining the fairness of the dismissal. Additionally, the court had to assess whether the dismissal was justified by the alleged misconduct, particularly focusing on the meaning of 'wilful'. The court held that 'wilful' required a deliberate or intentional act, and in this instance, the employer had failed to demonstrate that the plaintiff's actions met this standard.

The court concluded that the employer had not established a valid reason for summarily terminating Mr Redman's employment. The employer had not shown that the plaintiff's actions constituted 'wilful' misconduct, and the condonation by continuing to pay the plaintiff's salary undermined the employer's position. Consequently, the court ruled in favour of the plaintiff, awarding damages of $133,407. This sum reflected the lost wages and other entitlements that the plaintiff would have received had the termination not occurred or had it been handled in a fair manner.

Orders

Orders of the court

Verdict for the plaintiff in sum of $133,407

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	Redman v Verticon Group Limited (No 2) [2009] NSWDC 43
HEARING DATE(S):	9 - 13 March 2009
JUDGMENT DATE:	2 April 2009
JURISDICTION:	Civil
JUDGMENT OF:	Goldring DCJ
DECISION:	Verdict for the plaintiff in sum of $133,407
CATCHWORDS:	EMPLOYMENT LAW - summary termination - 'wilful or serious misconduct' - meaning of 'wilful' - EMPLOYMENT LAW - condonation of breach of employment contract by employer - CONTRACT - Employment Contract - duty of employee summarily dismissed to mitigate damages
LEGISLATION CITED:	Insurance Contracts Act 1984 (Cth)
CASES CITED:	Blyth Chemicals v Bushnell (1933) 49 CLR 66 Shepherd v Felt and Textiles of Australia Ltd (1931) 45 CLR 359 Concut Pty Ltd v Worrell (2000) 75 ALJR 312 Rankin v Marine Power International Pty Ltd [2001] VSC 150 Pastrycooks Employees, Biscuit Makers Employees and Flour and Sugar Goods Workers Union v Gartrell White [No 3] (1990) 35 IR 70 Bigg v NSW Police Service (1998) 80 IR 434 Briginshaw v Briginshaw (1938) 60 CLR 336 R v Galli [2001] NSWCCA 504 McDonald v Parnell Laboratories (Aust) Pty Ltd (2007) 168 IR 375 Cooper v Cooper (1941) 65 CLR 162 Byrne v Australian Airlines (1995) 131 ALR 422 Peter v Aradlay Insurance Brokers Pty Ltd [2005] NSWIRComm 253
PARTIES:	Jason Redman (Plaintiff) Verticon Group Limited (Defendant)
FILE NUMBER(S):	5716 of 2007
COUNSEL:	J Berwick (Plaintiff) T Saunders (Defendant)
SOLICITORS:	Craddock Murray Neumann (Plaintiff) Deacons (Defendant)