Ipsofactoj.com: International Cases [2000] Part 5 Case 1 [NZCA]


COURT OF APPEAL, NEW ZEALAND

Coram

Wood

- vs -

Christchurch Golf Club Inc

HENRY J

TIPPING J

DOOGUE J

23 MAY 2000


Judgment

Doogue J

SUMMARY

  1. At issue in this appeal is whether the Employment Court erred in law in reversing the decision of an Employment Tribunal that Mrs. Wood, the appellant in this appeal, had been dismissed by the Christchurch Golf Club Inc ("the Club").

    BACKGROUND

  2. In 1991 Mrs. Wood was employed by the Club as a part-time clerical assistant to work between 20 and 24 hours per week. Her husband was the Secretary / Manager of the Club. In 1996 the Club decided to amalgamate with the Christchurch Ladies Golf Club. The latter club was to become part of the Club. Agreement was reached that there would be a new management structure with a board and a General Manager who would have different functions and powers from those of the Secretary / Manager of the Club. As a result, on 26 July 1996 the then club captain for the Club met with Mr. and Mrs. Wood and handed them each a letter. The letter to the appellant read as follows:

    24th July 1996

    Dear Edna

    As you will be aware the Club recently adopted new Rules at a Special General Meeting. These new Rules will involve changes in the Club administration including the appointment of a General Manager.

    As yet the duties and responsibilities of the new administration have not been finalised.

    Until the new management structure is determined it is obviously uncertain whether there will be any continued role for part time secretarial work. This will not be determined until after the election of the Board of the Club in August and the subsequent clarification of the positions required in the administration of the Club. Once the new requirements are determined the various positions will be advertised and, depending on the appointments which are required, you may wish to make an application.

    However, at this stage it is necessary for us to give you notice that as from October 31st your present position as a part-time secretarial assistant will be redundant.

    The Club acknowledges your commitment and services to the Club and wishes you every success in the event of your wishing to make an application for such positions as may become available.

    Yours sincerely

    David Page

    Club Captain

  3. There was some conflict in the evidence as to the Club’s precise understanding of what the Club intended in respect of secretarial work after the appointment of the general manager. However, the club captain said he expected that it would be a full-time position, with the requirements of the position to be determined by the general manager. His evidence indicated that it would involve not only typing but also administration and would include secretarial support for the ladies’ committee and a significant increase in administrative tasks. However, the club captain made it clear that the ultimate decision as to the nature of the changes in secretarial and administrative assistance would be for the new general manager. It was expected the new general manager would be appointed in September 1996. It was also clear from the club captain’s evidence that the club continued to use part-time secretarial help until at least early 1997.

  4. Mr. Wood applied for the job as general manager. On 6 September 1996 Mr. Wood was advised by the club captain that he was not being appointed to that position. Mr. Wood’s employment was therefore to be terminated at 31 October 1996. Mr. Wood appeared to have taken it that Mrs. Wood would leave at the same time, although there is no evidence that she was ever advised that her employment with the Club was terminated. The club captain was not cross-examined about this. Mrs. Wood certainly did not suggest she was advised at any time that her employment had been terminated by the Club. No-one suggested that Mr. Wood was the agent of Mrs. Wood at 6 September 1996.

  5. In any event, Mr. and Mrs. Wood then discussed their position. Although there is some dispute about the precise facts, it is reasonably clear that a few days later there was a further meeting between the club captain and Mr. Wood, with Mr. Wood speaking on behalf of Mrs. Wood as well. Mr. and Mrs. Wood had by then decided it was best if they left the Club as soon as possible and it was agreed that they should leave on 20 September 1996.

  6. It is accepted that Mrs. Wood’s employment with the Club ended on 20 September 1996. It is common ground that by that date the new general manager had made no decision as to the form of secretarial and administrative assistance that the Club required and no new position had been advertised for which Mrs. Wood could apply. It seems to have been made plain by Mr. Wood to the club captain that in any event Mrs. Wood would not be interested in any further position.

  7. Eventually Mrs. Wood and her husband commenced claims against the Club for unjustified dismissal. We are concerned only with the claim of Mrs. Wood.

    EMPLOYMENT TRIBUNAL DECISION

  8. The hearing took place before the Tribunal on 29 June and 13 August 1998. The Tribunal by memorandum dated 7 September 1998 gave the parties the opportunity to make further submissions or call further evidence in respect of the claims. Further submissions were made to the Tribunal on 28 September 1998 and its decision was given the next day.

  9. After outlining the nature of the claim and the background to it, the Tribunal referred briefly to the relevant legal guidelines and then posed two questions for answer, namely:

    1. Were the Woods’ positions genuinely redundant?

    2. Were the Woods’ dismissals carried out in a fair and reasonable manner?

  10. The Tribunal said that if the answer to either of those questions was "no" in respect of either Mr. Wood or Mrs. Wood then they would have been unjustifiably dismissed.

  11. The Tribunal then answered the questions posed by it in respect of, first, Mr. Wood and then Mrs. Wood.

  12. The Tribunal concluded that Mrs. Wood’s position was not genuinely redundant. The Tribunal read into the club captain’s evidence that Mrs. Wood’s position became redundant because Mr. Wood’s position had become redundant and the Club wanted to allow the general manager to set the requirements for the replacement position. The Tribunal found that when Mrs. Wood was advised of the redundancy of her position in July 1996 the requirements of the new position had not yet been determined and that there was an on-going need for her position until the general manager had determined the requirements of it. The Tribunal therefore found that as at July 1996, when Mrs. Wood was advised that her position was redundant, she was not genuinely redundant and she was really made redundant solely because her husband’s position was made redundant.

  13. It was only at this stage that the Tribunal turned to the question of whether or not Mrs. Wood had resigned or was dismissed or disadvantaged in her employment. The argument before the Tribunal was that Mr. Wood was given notice of his dismissal on 6 September, with it to take effect on 31 October 1996. It was submitted for the Club that Mrs. Wood disadvantaged herself by resigning her employment from 20 September 1996. It was submitted for Mrs. Wood that the parties agreed to bring forward Mrs. Wood’s dismissal to 20 September 1996. On this critical issue the Tribunal said this:

    Mr. Wood was, on 26 July, given notice that his position as Secretary / Manager would cease to exist from 31 October 1996. On 6 September he was told that his application for the position of general manager was unsuccessful. On that day it was confirmed with Mr. Wood that his employment would end on 31 October.

    Rather than working until that date and then being dismissed Mr. Wood and Mrs. Wood ceased their employment on 20 September.

    Mr. Wood’s notes of the meeting of 9 September 1996 (exhibit A7) strongly indicate that it was he who, when asked by Mr. Page if they (the applicants) wanted to work until 31 October replied "no". Mr. Page then, according to Mr. Wood’s notes said that it would be acceptable for them to finish earlier.

    Mr. Page’s notes of that meeting (exhibit 14) confirm that Mr. Wood requested that they be allowed to finish immediately. After further discussions Mr. Page agreed to this request.

    I am satisfied that Mr. Wood and Mr. Page agreed, on 10 September, that the applicants’ dismissals would take effect on 20 September rather than 31 October as previously indicated.

    I therefore find that the applicants were dismissed on 20 September.

  14. It has to be noted that nowhere in that passage did the Tribunal reach any finding of fact as to the dismissal of Mrs. Wood and when and how it occurred.

  15. The Tribunal then went on to consider whether Mrs. Wood’s dismissal was carried out in a fair and reasonable manner and found that it was not and that she was unjustifiably dismissed. The Tribunal said this:

    I have already found that Mrs. Wood’s position was not genuinely redundant and as a consequence she must succeed in her claim of unjustifiable dismissal.

    For completeness I should also indicate that Mrs. Wood was not provided with fair and reasonable treatment in the way in which she was made redundant. She was not told, at any time prior to receiving the letter of redundancy, that she might be made redundant. At no time was the situation ever discussed with her. Mr. Page agreed that this was the case.

    I also note that while there is, in the letter written to Mrs. Wood dated 24 July 1996 (exhibit A5), an invitation to make an application for "such positions as may become available" no such position became available until February 1997. The respondent also took no further steps in the period 24 July to 20 September to further consult with Mrs. Wood about any new position.

  16. Having found in favour of Mrs. Wood, the Tribunal awarded her monetary sums totalling $8,536. The issue of costs was left open.

  17. The Club appealed.

    DECISION OF THE EMPLOYMENT COURT

  18. The Employment Court heard argument on 25 August 1999 and delivered its decision on 22 September 1999. After traversing the background to the appeal and the findings of the Tribunal, the Court reached a different conclusion from the Tribunal. In particular, the Court said:

    In asking itself whether Mrs. Wood’s position was genuinely redundant the Tribunal overlooked the full definition of redundancy. The definition of redundancy in the Labour Relations Act 1987 has been affirmed on many occasions as according with common usage of the term (for example, GN Hale & Sons Ltd v Wellington Caretakers IUOW [1991] 1 NZLR 151). Redundancy occurs when:

    A worker’s employment is terminated by the employer, the termination being attributable, wholly or mainly, to the fact that the position filled by that worker is, or will become, superfluous to the needs of the employer.

    A prerequisite for a redundancy is that there should be a termination of the worker’s employment by an employer. In Mrs. Wood’s case there was no such termination. Her decision to resign in company with her husband before the notice of redundancy had run its full course meant that she pre-empted any termination which might have arisen as a result of her position becoming superfluous.

    The appellant submitted that there had been no dismissal of Mrs. Wood. This is accepted.

    The Tribunal made a further error in finding that the position was not genuinely redundant. Again, returning to the definition, it is enough that the position sought by the worker is, or will become superfluous to the needs of the employer. The evidence is that the position was expected to (and indeed did) become redundant at some stage.

  19. The Court went on to deal with the Tribunal’s finding that Mrs. Wood had not been treated in a fair and reasonable manner. The Court said this:

    It is regrettable that Mrs. Wood was not involved in those discussions and the club did not keep her directly informed of developments after her notice of redundancy was given in July. Not having seen and heard the witnesses, the finding in relation to this matter is not one that can be lightly upset. However, from the transcript of evidence it is clear that Mrs. Wood had discussed the matter with her husband, that she made the conscious decision to resign early from her position before taking up the offer in the notice of redundancy to apply for any positions which would be advertised.

    ARGUMENT

  20. It is accepted for the appellant that appeals to this Court from the Employment Court are confined to matters of law: s 135 Employment Contracts Act 1991. It is submitted, however, that the Employment Court overlooked the requirements and limitations of its appellate role and misdirected itself in law or misunderstood or misapplied the law in respect of whether Mrs. Wood had been dismissed. In addition, it is said the Employment Court failed to give adequate reasons for departing from the Tribunal’s findings.

  21. It is submitted for Mrs. Wood that on a proper analysis the Tribunal’s findings in relation to the dismissal could not be held on appeal to be wrong and that in finding that Mrs. Wood had been dismissed the Tribunal reached a conclusion that was open to it on the evidence. The finding, it is said, was based upon the advantage the Tribunal had in hearing and assessing the witnesses and was a finding with which the Employment Court could not realistically and should not have interfered. It is submitted that the Court’s approach was contrary to principle and that there was no justification for the Court to reverse the Tribunal.

  22. The Club supports the judgment under appeal and attacks the decision of the Tribunal. It says that Mrs. Wood was not dismissed by the Club when she left on 20 September 1996.

  23. The Club further submits that the Court was correct in its conclusion that in July 1996 Mrs. Wood’s position "will become superfluous". It is said for the Club that the letter of 24 July 1996 merely constituted a notice of possible redundancy and that there had been no dismissal prior to Mrs. Wood resigning through her husband on 9 or 10 September 1996.

  24. The Club’s submissions also analysed and criticised the decision of the Tribunal in greater detail than that entered into by the Court.

    FIRST ISSUE:

    Has Any Error of Law on the Part of the Employment Court Been Identified?

  25. We have great difficulty in identifying any error of law on the part of the Employment Court. The submissions for Mrs. Wood make no criticism whatever of the Court’s findings of law. Indeed, they are accepted. What is said is rather that the Court failed to fulfil its proper appellate role and failed to articulate reasons for departing from the decisions of the Tribunal which had heard and seen the witnesses.

  26. The problem for Mrs. Wood is that the Court found, as it was entitled to do, that the Tribunal had not correctly applied the law in respect of termination and in relation to redundancy. Mrs. Wood’s submissions do not challenge the Court’s approach to that law. Thus the position is reached that the Employment Court was entitled to make its own findings on the evidence as to whether the Club had in fact terminated Mrs. Wood’s employment rather than consider the findings of the Tribunal.

  27. The Employment Court gave clear reasons for approaching the questions anew and in formulating them in the proper order adopted by it. It did not have to give reasons for setting aside the Tribunal’s decision because it approached the issues on a different basis. It said that the Tribunal was wrong in law, and there has been no challenge to that.

  28. This is not a case where the Tribunal’s decision can be defended upon the basis that the Tribunal was determining any crucial issues of credibility. On the critical issue of when it is said the Club dismissed Mrs. Wood from her employment, there is no finding of fact at all. It appears to be implicit in the decision of the Tribunal that she must necessarily have been dismissed when her husband was dismissed, but, as already recorded, there is no evidence of this. It may have been Mr. Wood’s understanding, but as at 6 September 1996 he was not the agent of his wife. At that time, on the evidence generally, it could well have been the case that employment would have been available for his wife, notwithstanding that none was available for him.

  29. Nor can the departure by the Court from the decision of the Tribunal in respect of whether there were justified grounds of redundancy be challenged as a question of law. The Tribunal has, as is admitted, approached the matter in the wrong way. The Court was entitled to approach the matter in the right way and to find as it did that the issue of whether there were reasonable grounds for redundancy could not be determined in July 1996 but had to be kept open until 31 October 1996. By that time Mrs. Wood had left the Club.

  30. When the Employment Court departs from the Tribunal in respect of its other findings, it is because of the Court’s determination that Mrs. Wood was not dismissed by the Club. When the Employment Court was free to find the facts in accordance with the correct law, it can hardly be said that its findings, having applied the correct law, can be errors of law. If there are any errors of fact, and no crucial ones have been identified, they are not vulnerable upon appeal. The decisions made by the Employment Court were clearly open to it.

  31. Thus, however the matter is approached under this head, we find that Mrs. Wood has shown no error of law in the approach of the Employment Court to the issues before it. Even if we were of a different view, however, we consider that the appeal must fail for other reasons which we will articulate shortly.

    SECOND ISSUE

    Was it Open to the Employment Court to Determine that Mrs. Wood Was Not Dismissed by the Club?

  32. The Employment Tribunal had first found that Mrs. Wood’s position was not genuinely redundant in July 1996. It had then found that Mr. Wood and the club captain agreed on 10 September that Mrs. Wood’s dismissal would take effect on 20 September 1996 and that she was dismissed on that date.

  33. As already noted, there was no finding by the Tribunal of how or when Mrs. Wood was dismissed from her employment. It is not suggested that the 24 July 1996 letter had that effect. It is accepted that that letter indicated that, while her present position would go, her employment was still open. There is a finding that Mr. Wood was dismissed on 6 September 1996 but no corresponding finding in respect of Mrs. Wood. There is no suggestion that the club captain dismissed her on 9 or 10 September 1996. Rather, the Woods seem to have agreed that she would leave along with her husband, regardless of whether any employment might still be open to her.

  34. In the absence of any finding by the Tribunal supported by evidence that Mrs. Wood’s employment was terminated by the club captain on a particular day, it was clearly open to the Employment Court to find, as it did, that there was no termination of her employment.

  35. That was particularly so when the Tribunal’s decision had been predicated upon the basis that Mrs. Wood’s position was not genuinely redundant in July 1996. However, as the Employment Court found and as is not disputed, the correct law was whether her position would become superfluous to the needs of the employer at about 31 October 1996 or thereabouts. The Employment Court was entitled to find that the basis upon which the Tribunal had predicated its decision that Mrs. Wood’s employment was terminated was based on a false premise. Therefore, as already indicated, it was clearly open to the Employment Court to reconsider the matter of whether Mrs. Wood’s employment was terminated and reach the finding that it did.

  36. Thus, on the central issue in this appeal we can see no error of law by the Employment Court and every justification for it to reach the determination that it did. It did not depart from any relevant finding of the Tribunal. It reached its own findings on a correct view of the law.

  37. However the matter is approached, therefore, there is no basis for this Court to interfere with the decision of the Employment Court, and it is unnecessary for us to traverse the other issues raised before us.

    DECISION

  38. The appeal is dismissed. The Club is entitled to $3,000 costs and its reasonable disbursements, including the reasonable travel and accommodation costs of counsel. Such disbursements are to be fixed by the Registrar in the event of any dispute.


Cases

GN Hale & Sons Ltd v Wellington Caretakers IUOW [1991] 1 NZLR 151

Legislations

Employment Contracts Act 1991: s.135

Labour Relations Act 1987 

Representations

S G Wilson for appellant (instructed by Duncan Cotterill, Christchurch)
J E Borthwick for respondent (instructed by Saunders & Co, Christchurch)


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