Shaw v State of New South Wales

The appeal concerned a decision of the court below to strike out certain paragraphs of a third further amended statement of claim. The appellant, an employee, brought claims against the respondent, his employer, for damages arising from his dismissal. The claims included breach of an implied term of mutual trust and confidence, negligence, and wrongful dismissal. The court below had struck out these claims on the basis that they disclosed no reasonable cause of action.

The primary legal issues before the Court of Appeal were whether the appellant had an arguable claim for breach of an implied term of mutual trust and confidence, whether a duty of care was owed by the employer to the employee in relation to dismissal, and whether damages for loss of future earnings and earning capacity were precluded by the principles established in *Addis v Gramophone Co Ltd*. The court was also required to consider the application of the "just, quick and cheap" provisions of the *Civil Procedure Act 2005* in determining whether the claims should be allowed to proceed to trial.

The Court of Appeal, comprising Beazley JA, McColl JA, Macfarlan JA, Barrett JA, and McClellan CJ at CL, allowed the appeal. The court reasoned that the claims, particularly concerning the implied term of mutual trust and confidence and negligence, were not so devoid of merit as to be struck out summarily. The judges found that the existence and scope of an implied term of mutual trust and confidence in employment contracts, especially in a heavily regulated statutory employment environment, and the potential for a duty of care in dismissal, were matters that ought to be determined at trial. The court also indicated that the *Addis* principle did not necessarily preclude all claims for damages for loss of future earnings in this context.

Consequently, the Court of Appeal set aside the order of the court below to the extent that it struck out paragraphs 11, 11A, and 11C of the third further amended statement of claim. The respondent was ordered to pay the appellants' costs of the notice of motion and the appeal.