Wilson Parking New Zealand Limited v Ate Property Limited t/a Mainland Parking
[2025] NZHC 2141
•1 August 2025
IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY
I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE
CIV-2025-409-119
[2025] NZHC 2141
BETWEEN WILSON PARKING NEW ZEALAND LIMITED
PlaintiffAND
ATE PROPERTY LIMITED trading as MAINLAND PARKING
Defendant
Hearing: 9 June 2025 Appearances:
K J Crossland and Y Freimond for Plaintiff G D Jones and V I Baakman for Defendant
Judgment:
1 August 2025
JUDGMENT OF ASSOCIATE JUDGE PAULSEN
This judgment was delivered by me on 1 August 2025 at 3.30 pm pursuant to Rule 11.5 of the High Court Rules.
Registrar/Deputy Registrar Date:
WILSON PARKING NEW ZEALAND LIMITED v ATE PROPERTY LIMITED trading as MAINLAND PARKING [2025] NZHC 2141
[1] Wilson Parking New Zealand Ltd (Wilson) sues ATE Property Ltd (ATE). Its complaint is that its former employees, Vernon Aubrey and Peter Turner, acting individually or together breached their individual employment agreements (IEAs), good faith and fiduciary obligations and misused Wilson’s confidential information to solicit and secure its clients for ATE. ATE is said to have had knowledge of Messrs Turner and Aubrey’s conduct by virtue of Mr Turner’s directorship of ATE, and received and appropriated the benefit of that conduct and caused Wilson substantial losses.
[2] Wilson has also filed two statements of problem in the Employment Relations Authority (the Authority) arising broadly out of the same facts. The first of those is against Messrs Turner and Aubrey and ATE. The second is against Mr Aubrey only.
[3] The application before me is made by Wilson under r 5.49 of the High Court Rules 2016 to set aside ATE’s appearance objecting to the Court’s jurisdiction. ATE’s objection is made on the basis that Wilson’s claims are within the exclusive jurisdiction of the Authority. ATE considers this necessarily follows from a straightforward application of the Supreme Court decision in FMV v TZB.1
[4] For Wilson, Mr Crossland advises that Wilson has filed in this Court as the Authority does not have the power to provide the equitable remedies it is seeking. It contends that in FMV the Supreme Court did not address the circumstance that arises here, of an equitable claim against a third party where the Authority cannot grant effective remedies.
[5] The issue arising is whether Wilson’s claim is within the exclusive jurisdiction of the Authority. For the reasons that follow I consider that it is.
Background
[6] Wilson is a carpark operator within New Zealand. It operates about 371 carparks around New Zealand in Auckland, Wellington and Christchurch, as well as regional centres.
1 FMV v TZB [2021] NZSC 102, [2021] 1 NZLR 466.
[7] Mr Turner was employed by Wilson from 8 July 2013 until 1 September 2023. His last role was General Manager Southern. His IEA contained terms relating to fidelity, confidential information, and conflicts of interest.
[8] ATE was incorporated on 11 April 2024. Mr Turner is its sole director and shareholder.
[9] Mr Aubrey was employed by Wilson from 4 August 2003 until 1 November 2024. By the end of his employment he was the Executive General Manager Development. His IEA also contained terms regarding fidelity, confidential information and conflicts of interest.
[10] On 3 September 2024, Mr Aubrey and Wilson executed a record of settlement (ROS) which provided that Mr Aubrey’s employment would terminate by reason of resignation, effective 1 November 2024. Wilson agreed to transfer a work vehicle and pay the equivalent of six months’ salary and Mr Aubrey agreed not to carry out certain restricted activities for a period of nine months from termination date. He further agreed to “abide by the enduring terms of the employment agreement that survive termination, including clauses concerning confidentiality, intellectual property and privacy”.
[11] ATE has entered leases with landowners in respect of sites previously leased and/or managed by Wilson and is using those sites in competition with Wilson. Wilson contends that during their employment with Wilson, Messrs Turner and Aubrey unilaterally or together were taking steps to solicit and secure Wilson’s landlord clients for a competing business operated through ATE.
The first Authority proceeding
[12] On 13 March 2025, Wilson commenced a proceeding in the Authority against Messrs Turner and Aubrey and ATE. The statement of problem includes claims that:
(a)Mr Turner breached the terms of his IEA during and/or after his employment with Wilson, breached his statutory obligation of good
faith and fiduciary obligations arising by reason of the employment relationship.
(b)Mr Aubrey incited, instigated, aided or abetted breaches of Mr Turner’s employment agreement.
(c)ATE incited, instigated, aided or abetted breaches of Mr Turner’s employment agreement.
[13] In the Authority proceeding Wilson seeks interim orders enjoining Mr Turner from performing the leases with former Wilson clients and assisting ATE from doing so, and for the deposit of all revenues received and to be received from carparks of former Wilson clients into a stakeholder account until further orders by the Authority or Employment Court determining ownership.
[14] The substantive relief sought includes determinations that Mr Turner breached his IEA, statutory duty of good faith and fiduciary obligations, an award for damages, an account of profits, a declaration that all receivables gained by the respondents (including ATE) are held on trust for Wilson and for disgorgement to it. Penalties are sought against Mr Turner for alleged breaches of his IEA and statutory duty of good faith, and against Mr Aubrey and ATE for their alleged inciting, aiding and abetting breaches of Mr Turner’s IEA.
The second Authority proceeding
[15] On 18 March 2025, Wilson commenced a second Authority proceeding against Mr Aubrey. The statement of problem alleges that Mr Aubrey breached his IEA and the ROS, his statutory obligation of good faith and his fiduciary duties said to arise by reason of the employment relationship between him and Wilson.
[16] In the second Authority proceeding Wilson seeks against Mr Aubrey determinations that he breached his IEA and the ROS, his statutory duty of good faith and his fiduciary obligations, damages, an account of profits and declaration that all receivables gained by him are held in trust for Wilson and for disgorgement to it.
This proceeding
[17] This proceeding was commenced by Wilson on 14 March 2025, that is in the days between the filing of the first and second Authority proceedings. Wilson pleads three causes of action against ATE, which are presented under the headings of knowing receipt, knowing assistance and breach of duty of confidence.
[18] For the first cause of action of knowing receipt, Wilson pleads that Messrs Turner and Aubrey breached their good faith and fiduciary obligations owed to it in several respects that are particularised in some detail but include such matters as:
(a)unilaterally altering Wilson’s standard termination clause in its contracts with clients for a property’s use in its carpark business so as to secure their business for ATE;
(b)misappropriating or exploiting Wilson’s confidential information while employed; and
(c)deliberately taking steps to conceal their actions or to obscure their significance from Wilson.
[19] Wilson says as a result of this conduct a significant number of its clients cancelled their leases and executed leases with ATE.
[20] Wilson also says, by virtue of Mr Turner being the sole director and shareholder of ATE, ATE had knowledge of the actions of Mr Turner so his conduct is attributed to ATE.
The remedies sought include:
(a)a declaration that ATE holds clients’ leases on an institutional constructive trust for Wilson;
(b)an account of profits;
(c)equitable compensation; and
(d)an injunction enjoining ATE from dealing with the leases it holds on trust for Wilson.
[22] The second cause of action for knowing assistance is based on the same allegations. Wilson pleads that ATE knowingly assisted Messrs Turner and Aubrey’s breaches of their fiduciary duties by execution of leases with Wilson’s clients and receiving those choses. Remedies sought include equitable compensation and an injunction enjoining ATE from dealing with client leases.
[23] By its third cause of action alleging breach of confidence, Wilson pleads that by its director, Mr Turner, ATE knew that confidential information of Wilson had been disclosed to Messrs Turner and Aubrey throughout the course of their employment, owed a duty to refrain from using or benefitting from the use of that confidential information and had breached that duty in several respects, including in entering into leases with Wilson’s clients. In respect to this cause of action Wilson seeks damages and injunctive relief.
[24] It is immediately obvious that to establish its causes of action Wilson relies substantially on obligations owed by Messrs Turner and Aubrey pursuant to the terms of their IEAs, as well as obligations that arise as a matter of law by virtue of the existence of the employment relationship in equity and under statute. The terms of Messrs Turner and Aubrey’s IEAs are pleaded in substantial detail.
[25] In addition, Wilson pleads that it has contemporaneously filed statements of problem in the Authority against ATE and Messrs Turner and Aubrey, and “relies upon and incorporates by reference the allegations in the Statements of Problem as if they had been pleaded in full in this proceeding”.
[26] ATE denies that it, Mr Turner or Mr Aubrey have acted unlawfully or that it has profited from any unlawful act.
The law
[27] Section 161 of the Employment Relations Act 2000 (the Act) relevantly provides:
161 Jurisdiction
(1)The Authority has exclusive jurisdiction to make determinations about employment relationship problems generally, including—
(a)disputes about the interpretation, application, or operation of an employment agreement:
(b)matters related to a breach of an employment agreement:
...
(d) matters alleged to arise under section 68 because a party to an [IEA] has bargained unfairly:
...
(r)any other action (being an action that is not directly within the jurisdiction of the court) arising from or related to the employment relationship or related to the interpretation of this Act (other than an action founded on tort):
...
...
(3)Except as provided in this Act, no court has jurisdiction in relation to any matter that, under subsection (1), is within the exclusive jurisdiction of the Authority.
...
[28]Section 5 of the Act contains the following definitions:
employment relationship means any of the employment relationships specified in section 4(2)
employment relationship problem includes a personal grievance, a dispute, and any other problem relating to or arising out of an employment relationship, but does not include any problem with the fixing of new terms and conditions of employment
[29] The leading authority on the interpretation and application of s 161 is the Supreme Court decision in FMV.2 Mr Jones carefully took me through the majority
2 FMV v TZB, above n 1.
judgment, as well as the judgment of William Young J in FMV. The effect of the decision is not in dispute and was pithily summarised recently by Radich J in Tracplus Global Ltd v Deaker:3
... the principles established by the Supreme Court in FMV v TZB : if a problem that relates to or arises out of an employment relationship can be framed within the terms of s 161 of the Employment Relations Act 2000 — which defines the jurisdiction of the Employment Relations Authority — then the Authority will have exclusive jurisdiction to determine it and it cannot be considered by this Court.
[30] In FMV, the Supreme Court held that in enacting s 161(1) the Legislature defined the technical term “problem” to ensure legal form did not distract the decisionmaker from focusing on the factual substance of the difficulty confronting the parties. The term “problem” would encompass all legal forms of claim, as long as the problem related to or arose from an employment relationship. The Court considered that whether a particular difficulty or controversy between parties related to or arose out of the employment relationship was simply a question of fact, and:
[93] ... If the controversy arises during the course of the employment relationship and in a work context, then it will be an employment relationship problem. That is because the expectations arising out of an employment relationship apply only in a work context. This does not necessarily mean only “at work during work hours”, though if the problem arises in that context, it will almost certainly be an employment relationship problem. Rather, an assessment of all of the facts is required, not just time and location. We accept this will sometimes be a question of judgement and degree, but given the statutory language, that is unavoidable.
[94] To be clear, given the test is factual, it will not matter whether other causes of action may also arise from the controversy between the parties. That a controversy can also be pleaded without reliance on what is described (with unhelpful circularity) as an “employment right or interest” does not itself take it outside the scope of “employment relationship problem”. All that matters is whether the controversy arose during the course of the employment relationship and in the work context. This necessarily means that if a controversy can be framed in terms of one or more of the examples in s 161(1)(a)–(qd), it must be brought in the Authority as an employment relationship problem. If it does not fit within any of those examples, it will then be a question of whether the problem nevertheless relates to or arises out of an employment relationship in terms of the open-textured introductory language of s 161(1) and the catch-all in paragraph (r).
(footnotes omitted)
3 Tracplus Global Ltd v Deaker [2023] NZHC 3573 at [1] (footnote omitted).
[31] As will be noted, the test is whether the claim reflects a problem that relates to or arises from an employment relationship and in a work context. If so, it will be within the exclusive jurisdiction of the Authority.
[32] The majority noted that post-employment obligations entered into during the course of the employment relationship are logically aspects of the employment relationship and can give rise to employment relationship problems within the exclusive jurisdiction of the Authority. The Supreme Court gave restraints of trade as an example, and said:
[99] While the parties must always be able to point to an employment relationship, the “work context in the course of the employment relationship” test does not cover all relevant situations. As discussed above ... the employment relationship under the Act is larger than the employment contract, both in content and scope. For example, obligations that control the relationship are not limited to those in the employment contract. In particular, “post-employment” obligations entered into during the course of the relationship and in the work context are logically aspects of the employment relationship, even if the effect of entering into those obligations was to end the employment contract.
[100] The structure of the Act confirms this position. Section 161(1)(n) provides that the Authority has exclusive jurisdiction over compliance orders. It can grant a compliance order to enforce a settlement agreement, provided the agreement has been countersigned by an authorised mediator. That does not mean that the Authority has jurisdiction over settlement agreements only when they have been countersigned by a mediator ... Rather, it demonstrates that issues of compliance with settlement agreements generally are employment relationship problems. It must be remembered that s 161(1) is cast in inclusive language.
[101] In turn, the indirect inclusion of settlement agreements in s 161(1) demonstrates the more general principle that post-contractual obligations entered into as part of an employment relationship and in a work context can give rise to employment relationship problems within the exclusive jurisdiction of the Authority, even if they are not sourced in the employment contract itself. Problems with restraints of trade, for example, would therefore also be covered. It would not matter whether the obligation arose from a term in the employment contract or from a later severance agreement. The fact that the former is expressly covered by s 161(1)(a) and (b), while the latter is not, is immaterial. The problem is the same.
(footnotes omitted)
[33] The Court also said that it was not only parties to an employment relationship who could have an employment relationship problem or bring or defend proceedings
in the Authority. It emphasised that the important element was the nature of the problem, not the identity of the parties:
[103] As the High Court noted in Hagai, split proceedings will also be likely in multiple defendant cases where only one or some of the defendants are employees. BDM Grange and Global Kiwi NZ Ltd v Fannin are two examples of this occurring. Claims against the employee that arise from employment relationship problems will need to be brought in the Authority, while claims against third parties will generally belong in the High Court. Any risk of inconsistent factual findings in different forums will need to be managed carefully by procedural means.
[104] To be clear, we do not suggest that only parties to employment relationships can have employment relationship problems, or bring or defend proceedings in the Authority. The important element is the nature of the problem, not the identity of the parties. For example, in Waikato Rugby, a disagreement between the New Zealand Rugby Football Union Inc (NZRFU) and the Waikato Rugby Union Inc over which union a player should represent was appropriately seen as an employment relationship problem because it was a disagreement over NZRFU’s employment agreement with the player.
(footnotes omitted)
[34] Mr Jones referred me to two decisions of the High Court which have recently applied FMV.
[35] In Tracplus Global Ltd v Deaker, Radich J held that the Authority had exclusive jurisdiction to determine the claims filed in the High Court.4 Mr Deaker was formerly an employee of Tracplus, as were two directors of a company V2Track (2022) Ltd (V2 Track). Tracplus was concerned that Mr Deaker and the two directors may have used confidential information by reason of their former employment relationships with Tracplus. Tracplus pleaded a cause of action for breach of a confidentiality provision in Mr Deaker’s employment agreement, a cause of action against Mr Deaker for breach of confidence, and against V2Track in vicarious liability as well as for inducing breach of contract and causing loss by unlawful means.
[36] Tracplus’s case was that no issues arose out of the former employment relationship because:
4 Tracplus Global Ltd v Deaker, above n 3.
(a)the claim against Mr Deaker was for breach of confidence, where the breach occurred after his employment had ended;
(b)Mr Deaker’s access to confidential information took place outside the employment relationship context;
(c)Tracplus no longer relied upon breach of the employment agreement as the confidential information in question was not provided to Mr Deaker when he was employed by it; and
(d)Tracplus’s proceeding against both Mr Deaker and V2Track relied only on tortious claims.
[37] Radich J found that TracPlus’s complaints all stemmed from the fact that, by virtue of the former employment relationships, Mr Deaker and two other former employees had access to documents and information which they could misuse on behalf of V2Track.5 He considered that the “problem” was that as a result of their former employment documents and data had been shared with them, albeit in each case in an unsolicited way, and TracPlus was concerned they would have the potential to misuse it. Radich J said:
[44] I do not believe that there is any tenable way around the conclusion that, on the facts of the case, the problems arise out of the former employment relationships. They could be expressed in one or more different ways within the terms of s 161. They could be expressed as a breach of the confidentiality provisions in the employment agreements, as aiding and abetting breaches of those provisions, or, if the employment agreements between TracPlus and [the other two former employees] did not contain a confidentiality clause, as a breach of an implied term prohibiting disclosure of confidential information obtained in the course of the employment relationship.
[45] Furthermore, as the Supreme Court said, post-employment obligations entered into during the course of the relationship are logically aspects of the employment relationship.
(footnote omitted)
5 At [37].
[38] It was held that it did not matter that TracPlus had chosen to frame its causes of action solely in tort nor that the claim was brought against a third party because “the relevant relationships fall to be analysed in employment terms”.6
[39] The second decision is Intergroup Ltd v Pipe Vision NZ Ltd.7 Intergroup and Pipe Vision were competitors. Mr Andersen was employed by Intergroup as a driver/operator of specialised equipment with an employment agreement that included a 12-month non-compete restraint and non-solicitation restraint. Mr Andersen started working for Pipe Vision. Intergroup claimed that Pipe Vision had induced or caused Mr Andersen to breach the restraints, causing it to lose their excavation business. Its claim was in tort for inducing breach of contract and interference with contractual relations.
[40] Pipe Vision argued that the claim concerned the interpretation and application or operation of the restraints within s 161(1)(a) of the Act. It was grounded in the question of whether the restraints were reasonable and enforceable, or alternatively it was a dispute arising out of the employment relationship and hence within the opening words of s 161.8 It submitted the fact that it was a third party to the employment relationship did not undermine that conclusion given the connection that existed between the claims and Intergroup’s employment relationship with Mr Andersen. Anderson J agreed with that analysis. She considered the majority’s approach in FMV was “universalist”, as it “directs that the jurisdiction issue be determined on the basis of a factual assessment focusing on the wording of s 161 without gloss”.9 She said:10
The Majority’s approach requires a court to consider as a matter of fact the intensity of the connection of the dispute to an employment relationship envisaged by the expressions “arising out of” or “relating to” in the definition of “employment relationship problem”.
[41] Anderson J held that while the involvement of a third party was relevant to the degree of connection of the dispute to an employment relationship, the case before her was in essence a dispute arising out of Mr Andersen’s employment relationship with
6 At [51].
7 Intergroup Ltd v Pipe Vision NZ Ltd [2024] NZHC 159.
8 At [20].
9 At [17].
10 At [17].
Intergroup.11 Anderson J upheld the protest to jurisdiction and dismissed the proceeding.
Submissions
ATE’s position
[42] ATE submits it is plain that Wilson’s claims relate to and arise out of its employment relationships with Messrs Turner and Aubrey, the terms of their IEAs, the obligations arising by virtue of those relationships, and alleged breaches of them. It says the controversy can be framed in terms of the chapeau to s 161 and subs (1)(a), (b), (f), (m) or (r) and so must be brought in the Authority.
[43] In support of ATE’s submission, Mr Jones notes that the first cause of action is expressly based on alleged breaches by Messrs Turner and Aubrey of obligations arising from their IEAs, and that ATE’s alleged liability arises by attribution of Mr Turner’s knowledge of the alleged employment breaches by himself and Mr Aubrey. The second cause of action is based on an allegation that ATE knowingly assisted in Messrs Turner and Aubrey’s alleged breaches of fiduciary obligations arising from their employment relationships. The third cause of action is based on ATE’s alleged knowledge of Messrs Turner and Aubrey’s breaches of their duties as employees.
[44] Mr Jones also notes that Wilson pleads the contemporaneous filing of the two statements of problem in the Authority, annexes them as appendices to its statement of claim, and relies on and incorporates by reference the allegations in the statements of problem as if pleaded in full, all demonstrating the degree of connection between the dispute between the parties and their employment relationships.
[45] As all three causes of action describe an employment relationship problem within the exclusive jurisdiction of the Authority it follows, in ATE’s submission, that this proceeding must be dismissed under r 5.49(3).
11 At [21].
Wilson’s position
[46] Wilson submits the Court may not decline jurisdiction where that would effectively direct a party to a forum lacking the capacity to deliver justice, and this Court should not decline jurisdiction when the Authority does not have jurisdiction to treat equitable claims of knowing receipt and knowing assistance as employment relationship problems or to grant the remedies Wilson seeks. These include:
(a)declaring the existence of an institutional constructive trust;
(b)ordering an account of profits;
(c)granting proprietary or tracing injunctions;
(d)interim injunctions against third parties; and
(e)equitable compensation.
[47] Mr Crossland says the fact ATE’s director is a former employee of Wilson does not alter this jurisdictional limitation in terms of remedies, and to suggest otherwise conflates Mr Turner and ATE as the same legal person. He says the artificiality of that position is obvious because if Mr Turner was to resign as a director of ATE the Authority would not retain jurisdiction over Wilson’s problem.
[48] He suggests that the employment background does not render Wilson’s data and client misappropriation problem with ATE as an employment relationship problem, and Wilson is not enforcing a restraint against ATE nor pleading that ATE has induced a breach of restraint by Mr Turner.
[49] Mr Crossland argues that Mr Turner furnished ATE with Wilson’s information qua director of ATE, not qua former employee of Wilson, albeit that he originally procured some of that information as an employee. He submits that if Mr Turner was not a director there would be no reason for him to give ATE Wilson’s data, and it is only through his capacity as a director that ATE is attributed with Mr Turner’s knowledge and the conduct of Mr Turner as an employee and post-employment.
[50] Mr Crossland also submits that the claims Wilson is making are not ones where the Authority’s specialisation as an employment tribunal will offer any advantage to the parties.
[51] Mr Crossland referred me to Service Foods Ltd v Wang, where it is said the High Court recently addressed knowing assistance and knowing receipt claims against a company directed by an employee’s wife while the employer simultaneously sued the former employee in the Employment Court.12 Both courts granted freezing orders. Notably, misappropriation by the employee and the wife’s company’s receipt occurred while the employee was still employed, yet in that context the two courts were comfortable with the demarcation of judicial tasks. Here, Mr Crossland submits the alleged misappropriation of value by ATE occurred and continues to occur after Mr Turner’s employment ended and after the expiry of his restraint period, underscoring that the conduct now in issue, whilst starting during the period of Mr Turner’s employment, “lies squarely outside the employment relationship framework”.
[52] Mr Crossland also referred to Eurekly Ltd v Crimson Consulting Ltd, which he said is persuasive authority that causes of action in equity such as knowing receipt, breach of fiduciary duty and breach of confidence possess an essential character independent of employment,13 and also that the remedies sought in respect to those causes of action are not available in the Authority.14 He argued that the Supreme Court in FMV did not diminish the “Eurekly logic that the Authority cannot grant equitable remedies against third parties”.15
[53] Mr Crossland also relies upon Global Kiwi NZ Ltd v Fannin, where it is said claims brought in the High Court against a former employee of the plaintiff for misconduct during employment were struck out for lack of jurisdiction, but claims against a former employee/director and the company he had incorporated after the end of his employment were held to be properly before the Court.16 Mr Crossland said the
12 Service Foods Ltd v Wang [2024] NZHC 1396.
13 Eurekly Ltd v Crimson Consulting Ltd [2019] NZHC 2674 at [44].
14 At [45].
15 FMV v TZB, above n 1.
16 Global Kiwi NZ Ltd v Fannin [2014] NZHC 656.
case is illustrative because the High Court recognised that claims against the former director/employee fell squarely within the Court’s jurisdiction even though some of the factual background overlapped with an employment setting.
[54] Mr Crossland distinguishes FMV on the basis that it did not concern claims in equity and nor was the Court grappling with the particular remedies Wilson now seeks.17 He distinguished Tracplus Global Ltd v Deaker and InterGroup Ltd v Pipe Vision NZ Ltd on the same basis and submits these decisions did not consider Eurekly and nor did they consider an added feature of this case, where in correspondence between the parties’ lawyers ATE has foreshadowed the possibility of making claims against Wilson alleging misuse of a dominant market position to exclude ATE from gaining a foothold in Christchurch.18
[55] Mr Crossland also sought to distinguish New Zealand Rugby Football Union Inc v New Zealand Rugby Promotions Ltd, where the issue was whether a player should represent the Waikato Rugby Union or the New Zealand Rugby Football Union.19 The Supreme Court in FMV held it was appropriately seen as an employment relationship problem “because it was a disagreement over NZRFU’s employment agreement with the player”.20 Mr Crossland says there the Court was managing or enforcing a live employment relationship, whereas this case is about vindicating equitable rights for conduct of a third party after an employment relationship ended.
[56] Wilson argues, therefore, that the alignment of proceedings in this Court and the Authority reflect an appropriate and necessary split of jurisdiction, which is indispensable to ensuring that Wilson has available to it a full suite of remedies. It says the need to split off the proceedings is not to be regarded as a jurisdictional defect but as an acknowledged feature of the statutory scheme.
17 FMV v TZB, above n 1.
18 Tracplus Global Ltd v Deaker, above n 3; and InterGroup Ltd v Pipe Vision NZ Ltd, above n 7.
19 New Zealand Rugby Football Union Inc v New Zealand Rugby Promotions Ltd [2002] 1 ERNZ 752 (EmpC).
20 FMV v TZB, above n 1, at [104].
My analysis
[57] There is no doubt, as I understood Mr Crossland to acknowledge at the commencement of his oral submissions, that Wilson’s claims against ATE do in fact arise out of and are related to the employment relationships between Wilson and Messrs Turner and Aubrey. For my part, and for all the reasons advanced by ATE, I do not believe there can be any other conclusion than that what Wilson pleads as equitable causes of action are employment relationship problems within the chapeau to s 161 and subs (1)(a),(b), (f) and (r). The controversy relates directly to the employment relationships between Wilson and Messrs Turner and Aubrey, the obligations arising from the relationships and alleged breaches of those obligations including during the periods of their employment. It must necessarily follow that Wilson’s claims are within the exclusive jurisdiction of the Authority.21
[58] So what of Wilson’s assertion that the Authority does not have remedial powers to grant it equitable remedies? There are several answers to this. The first is that, to the extent that is the case, it is a necessary consequence of Parliament’s intention to confer on the Authority a monopoly over employment relationship problems.22 Related to this, the Supreme Court recognised the Authority is not bound by the way the parties frame their dispute and it is open to it to reframe the problem and resolve it in such manner as it considers appropriate when the majority stated:23
[58] Finally, and critically, the Authority is not bound by the way the parties have framed their dispute. If it considers the parties have not understood the real nature of their problem, it can reframe the problem and resolve that. The design of the Authority is therefore premised on a fact- oriented, merits-based approach; a departure from the position under the ECA.
[59] Second, it is not the case that the Authority cannot grant Wilson any remedies. In FMV, William Young J considered decisions on the extent of the remedies the Authority and the Employment Court could grant. In respect to the Authority’s jurisdiction, he concluded that:24
At least where the remedies sought are conceptually similar to those available in contract or in respect of personal grievances, I see the conferral of
21 FMV v TZB, above n 1, at [108].
22 FMV v TZB, above n 1, at [108].
23 FMV v TZB, above n 1 (footnote omitted).
24 At [165(c)].
jurisdiction under s 161 in respect of a particular dispute as carrying with it the powers to grant such remedies as are necessary to determine that dispute.
[60] There are other decisions suggesting that the Authority does have the power to grant such remedies as are necessary to exercise its exclusive jurisdiction.
[61] In Jerram v Franklin Veterinary Services (1977) Ltd the issue was whether the Authority could issue interlocutory injunctive orders.25 Colgan J held that it did as:26
... it must follow by necessary implication that the Authority also possesses the power to preserve or alter the rights and obligations of the parties pending its determination of a claim to substantive relief ...
[62] New Zealand Fire Service Commission v Warner concerned a claim removed from the Authority to the Employment Court to determine a question of whether an employer may sue an employee in the Authority for remuneration mistakenly overpaid.27 Chief Judge Colgan said:
[37] While such of the employer’s causes of action as are in contract are clearly within jurisdiction, and its claim in tort is clearly without jurisdiction, the status of the claims in equity or quasi-contract are more difficult to decide. Because of the breadth of the concept of an employment relationship problem that is justiciable, I respectfully disagree with the obiter dicta (observations) of the High Court in [74] of BDM Grange ... If, as here, the employment relationship problem for resolution (a claim for repayment of allowances allegedly overpaid to employees) requires a consideration and application of the law of restitution of moneys had and received or of unjust enrichment, then this was intended, to use the words of the High Court, to be the core business of the Authority. The jurisdictional ability to perform that core business necessarily follows.
[63] In Pretorius v Marra Construction (2004) Ltd, Judge Corkill held the Authority had jurisdiction to consider a former employee’s claim in quantum meruit, whether based on quasi contract or in equity.28 Referring to the judgment in New Zealand Fire Service Commission v Warner, he said:
[77] I respectfully agree with these conclusions as to jurisdiction. The key issue for present purposes is whether the quantum meruit action arises from or relates to an employment relationship. Applying those principles, I find that the essence of Mr Pretorius’ claim in quantum meruit, whether based on quasi contract or equity, relates to and arises from an employment relationship.
25 Jerram v Franklin Veterinary Services (1977) Ltd [2001] ERNZ 157 (EmpC).
26 At [25].
27 New Zealand Fire Service Commission v Warner [2010] NZEmpC 90, [2010] ERNZ 290.
28 Pretorius v Marra Construction (2004) Ltd [2016] NZEmpC 95, [2016] ERNZ 591.
Consequently, the Authority has jurisdiction to consider the possibility of awarding such a remedy on the basis of that employment relationship.
(footnote omitted)
[64] In Hibernian Catholic Benefit Society v Hagai, Associate Judge Bell considered that in cases where the Authority decides matters under the general law it:29
…has the same tools as are available to the ordinary courts.30 Subject to s 157(3), the authority applies the same substantive law and gives the same relief …
[65] In Newick v Working In Ltd, the plaintiff, contending that he had been unjustifiably dismissed for redundancy, pleaded under the heading “estoppel” that the employer had promised him he would be paid a recompense payment of six months’ salary whether he accepted a new position with the company or not, and that he had relied on that promise to his detriment and that the employer reneged on the promise.31 The employer sought an order striking out the estoppel cause of action on the basis it was not within the Employment Court’s jurisdiction. Judge Inglis said the Authority and the Employment Court enjoyed exclusive, although limited, jurisdiction and that:
[51] Such an approach is also consistent with the statutory focus on the substance of a claim rather than its form: ss 189 and 219, and the underlying purpose of s 161, which is designed to allow resolution of the employment relationship problem generally. As the High Court in BDM Grange acknowledged: “[w]ithin their respective jurisdictions the Authority and the Employment Court must have the tools required to perform their important tasks.” ...
[66] However, even if there are limits on the remedial powers of the Authority in this case, such limits would not apply to the Employment Court to which its claim can be transferred under s 178 of the Act. The possibility of transferring a problem from
29 Hibernian Catholic Benefit Society v Hagai [2014] NZHC 24 at [14]. I note that in JP Morgan Chase Bank NZ v Lewis [2015] NZCA 255, [2015] 3 NZLR 618 the Court of Appeal disagreed with the reasoning of Associate Judge Bell insofar as he found that a claim to recover money from an employee in the course of her employment was within the exclusive jurisdiction of the Authority. However, the majority of the Supreme Court in FMV v TZB, above n 1, at [89]–[91] disagreed with the approach in JP Morgan.
30 Citing BDM Grange Ltd v Parker [2006] 1 NZLR 353 (HC) at [63]–[64]; X v Y Ltd and NZ Stock Exchange [1992] 1 ERNZ 863; and Hobday v Timaru Girls’ School Board of Trustees [1993] 2 ERNZ 146 (CA).
31 Newick v Working In Ltd [2012] NZEmpC 156, [2012] ERNZ 510.
the Authority to the Employment Court was recognised by William Young J in FMV. While noting there was uncertainty concerning the nature of the exclusive jurisdictions of the Authority and Employment Court, William Young J said:32
An absence of power to grant remedies appropriate to a dispute may suggest that the dispute is not within those exclusive jurisdictions. There might also be scope for argument as to whether an absence of power in the Authority is rendered irrelevant by the more extensive powers of the Employment Court, to which the hearing of that dispute may be removed.
[67] It has long been held that the Employment Court may determine claims in equity including in respect to the misuse of confidential information.33 In FMV, William Young J considered that s 189 of the Act, which grants the Employment Court the power to determine matters before it in equity and good conscience, conferred a general power to grant such remedies as may be necessary to determine “any matter” before it.34 The majority in FMV noted:
[108] ... But that is inevitable given the Act’s firm line on the Authority’s monopoly over employment relationship problems. We accept also that there may still be jurisdictional uncertainty at the margins. But, as we noted above
..., the Authority can remove any cases raising complex legal issues to the Employment Court for resolution,35 including those raising any difficult questions of jurisdiction.
[109] If Parliament considers this position unsatisfactory, it will no doubt move to amend the legislation accordingly. ...
(footnote omitted)
[68] Here, given the complexity and importance of the problems that arise between these parties, along with the existence of any uncertainty as to the Authority’s ability to grant all the remedies to which Wilson considers it is entitled, there is ample scope for all matters between Wilson, Messrs Turner and Aubrey and ATE to be removed to the Employment Court under s 178(2), which relevantly provides:
178 Removal to court generally
...
32 At [164].
33 Rooney Earthmoving Ltd v McTague [2009] ERNZ 240 (EmpC); Hally Labels Ltd v Powell [2015] NZEmpC 92, [2015] ERNZ 940.
34 FMV v TZB, above n 1, at [162].
35 See Employment Relations Act 2000, s 178(2)(a) and (d).
(2)The Authority may order the removal of the matter, or any part of it, to the court if—
(a)an important question of law is likely to arise in the matter other than incidentally; or
...
(c)the court already has before it proceedings which are between the same parties and which involve the same or similar or related issues; or
(d)the Authority is of the opinion that in all the circumstances the court should determine the matter.
...
[69] For completeness I will address quickly the other arguments advanced for Wilson to support its contention that this Court and not the Authority is the correct forum to hear this claim.
[70] I do not accept that to suggest Wilson’s claim is an employment relationship problem is artificial, or that if Mr Turner was to resign as a director of ATE the Authority would not retain jurisdiction of Wilson’s problem. The Court must deal with the facts as they are, not on the basis of a counterfactual.
[71] Further, to my mind it is artificial to argue that in all relevant respects Mr Turner was acting qua director of ATE not qua former employee of Wilson. The problem that Wilson brings to the Court concerns breaches of obligations owed by Mr Turner arising from his employment, not as a director of ATE. The fact that Wilson attributes knowledge of those breaches of obligation by reason of Mr Turner’s directorship of ATE is incidental. It also does not matter that ATE has responded to Wilson’s claim by raising the prospect of bringing counterclaims that are not within the jurisdiction of the Authority. The prospect of split hearings was recognised in FMV.
[72] It was argued that the Authority’s specialisation as an employment tribunal offered no advantages to the parties in this case. I do not necessarily accept that contention but, in any event, it is not a matter that could displace the Authority’s jurisdiction.
[73] I do not accept that the approach in FMV should not apply because that case did not concern a claim in equity where there was doubt about the Authority’s remedial powers.36 The Supreme Court in FMV stated a general principle that a claim must be brought in the Authority if it reflects a problem that relates to or arises from an employment relationship. That principle clearly extends to disputes that are framed as equitable claims. For the same reason I do not accept Wilson’s attempt to distinguish Tracplus Global, Intergroup Ltd or the New Zealand Rugby Football Union.37
[74] I also do not accept Wilson’s reliance upon Service Foods Ltd v Wang or Eurekly.38 In Wang it appears the High Court granted freezing orders without considering the Authority’s exclusive jurisdiction under s 161. Eurekly is an example of what the Supreme Court in FMV described as the “one true essence theory which is false”.39 I do not consider Eurekly was correctly decided.
Result
[75] Wilson’s application to set aside ATE’s appearance objecting to the Court’s jurisdiction is dismissed.
[76] Under r 5.49(6) of the High Court Rules I am satisfied that this Court does not have jurisdiction to hear Wilson’s claims and this proceeding is dismissed.
[77] ATE is entitled to costs and reasonable disbursements. My preliminary view is that costs on a 2B basis are appropriate but if there is disagreement on costs counsel may submit memoranda (no longer than five pages) within 14 days and I would expect to deal with the matter on the papers.
O G Paulsen Associate Judge
36 FMV v TZB, above n 1.
Tracplus Global Ltd v Deaker, above n 3; Intergroup Ltd v Pipe Vision NZ Ltd, above n 7; and
New Zealand Rugby Football Union Inc v New Zealand Rugby Promotions Ltd, above n 19.
38 Service Foods Ltd v Wang, above n 12; and Eurekly Ltd v Crimson Consulting Ltd, above n 13.
39 FMV v TZB, above n 1, at [91].
Solicitors:
Shieff Angland Lawyers, Auckland Saunders Robinson Brown, Christchurch
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