Smith Crane & Construction Limited v Hall

[2015] NZCA 427

IN THE COURT OF APPEAL OF NEW ZEALAND

CA363/2015
[2015] NZCA 427

BETWEEN	SMITH CRANE & CONSTRUCTION LIMITED Applicant
AND	ANDREW HALL Respondent

Hearing:	7 September 2015
Court:	Harrison, French and Cooper JJ
Counsel:	T J McGinn for Applicant   K T Dalziel and P J Brown for Respondent
Judgment:	9 September 2015 at 4.00 pm

JUDGMENT OF THE COURT

AThe application for leave to appeal is declined.

BThe applicant must pay the respondent’s costs for a standard application on a band A basis with usual disbursements.

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REASONS OF THE COURT

(Given by French J)

1. Smith Crane & Construction Ltd (Smith Crane) seeks leave to appeal against a decision of Judge Corkill in the Employment Court.[1]

   [1]Smith Crane & Construction Ltd v Hall [2015] NZEmpC 82.

2. The facts before the Judge were that Smith Crane had sent a letter to the respondent Mr Hall offering him employment.  The letter included a statement that Mr Hall “would be employed under an attached individual employment agreement except where expressly modified by this letter”.  The attached individual employment agreement was an incomplete standardised agreement. It contained a clause providing for a 90-day trial period.  Mr Hall counter-signed the letter of offer, but not the employment agreement before commencing work.  The employment agreement was signed four weeks after his commencement date.  Subsequently, Smith Crane purported to terminate his employment relying on the 90-day trial clause.

3. Judge Corkill found that Mr Hall’s counter-signing of the letter of offer did not incorporate the terms of the attached employment agreement.  It followed there was not a binding 90-day trial period arrangement in place.  Under s 67A of the Employment Relations Act 2000, such arrangements are only enforceable if at the time they were entered into the employee had not previously been employed by the employer.  At the time Mr Hall signed the employment agreement, he was an existing employee.

4. In order to obtain leave, Smith Crane must persuade us there is a question of law which by reason of its general or public importance or for some other reason ought to be submitted to this Court for decision.[2]

   [2]Employment Relations Act 2000, s 214(3).

5. Smith Crane submits there are two questions which meet those criteria.  The first proposed question is:

   Was the Employment Court wrong in law to find that the terms of a standard individual employment agreement were not incorporated expressly by reference into an agreement comprising the signed letter of offer together with the terms of the standard individual employment agreement including the trial period provision?

6. It is common ground that on the signing of the letter of offer, a contract came into existence.  Correctly analysed, the issue must therefore be what were the terms of that contract?  In our view, that is a question of fact, not law.  There is no ability to appeal in respect of questions of fact.

7. Further, even if it were an issue of interpretation and hence a question of law, there is the further difficulty that s 214(1) of the Employment Relations Act provides that a decision on the construction of an individual employment agreement is not amenable to appeal.

8. Smith Crane attempted to overcome this obstacle by contending the Judge made an error of principle in his approach to the interpretation of the contract.  According to Smith Crane, the Judge reached the outcome he did by relying on the parties’ subjective intentions instead of ascertaining the objective meaning of the words.  However, we do not accept that the Judge did err in that way.

9. Smith Crane also contended that in identifying the context in which the contract was to be construed, the Judge had erroneously overlooked relevant matters.  However, the matters which Smith Crane submits were overlooked (the fact Mr Hall was aware the employment agreement was a standard contract, the negotiations after the offer was sent to Mr Hall, his shifting from the United Kingdom to take up the job, Mr Hall’s communications with Immigration New Zealand) were in fact all alluded to by the Judge.  The inferences to be drawn from those facts and the weighting to be attached to them, are questions of fact, not law.

10. The second question sought to be submitted was inextricably linked with the first question.[3]  Smith Crane’s counsel Mr McGinn accepted that if we did not grant leave in respect of the first question, then the second question would fall away.

    [3]“If yes, does s 67A(1) of the Act require that a form of employment agreement that contains a trial provision should be specifically acknowledged by signing when a letter of offer incorporating those terms of agreement is signed?”

11. The application for leave to appeal is accordingly declined.

12. The applicant must pay the respondent’s costs for a standard application on a band A basis with usual disbursements.

Solicitors:
Lexington Legal, Christchurch for Respondent