Significant Decisions Headnoted – November 2008
Commissioner of Police v Hawkins
CA 212/2008
Heard: 16 Jun 2008, Wellington
Judgment Date:
9 Jul 2008
Court/Authority:
O'Regan, Arnold, Baragwanath JJ
Appearances:
JC Holden ; CP Brosnahan
COURT OF APPEAL – Practice and procedure – Application for leave to appeal against Employment Court decision – Remedies – Applicant sought leave to appeal on 5 grounds - Whether reinstatement open – Whether reimbursement of lost income appropriate - Whether compensation excessive – Whether Employment Court erred on approach to contribution – Whether particular invoice recoverable as a disbursement – HELD – Leave granted on issues of reinstatement, award of lost wages, and compensation award – Part of question of leave on reinstatement issue reserved until hearing - Other grounds raised factual issues not amenable to appeal – Application allowed in part – Police sergeant
This was a partially successful application for leave to appeal against an Employment Court decision.
The Employment Court held that the applicant had constructively and unjustifiably dismissed the respondent (See: [2007] ERNZ 762, “the liability judgment”). In a further judgment, the Employment Court ordered reinstatement, awarded compensation for lost wages, and awarded compensation of $35,000 for hurt and humiliation. The Employment Court also awarded costs in favour of the respondent and ordered the applicant pay $21,532.50 towards a disbursement that the respondent incurred as a result of work that the respondent’s friend had undertaken in relation to the personal grievance. (WC 7/08, 27 March 2008 (Recalled and reissued: WC 7B/08, 12 August 2008), “the remedies judgment”).
The Court had already granted leave to appeal against the liability judgment on three questions (See: [2008] NZCA 164).
The applicant sought leave to appeal the remedies judgment on the following grounds: (a) whether it was open to the Employment Court to reinstate the respondent at the rank of sergeant to supervise operational police members after nearly seven years, given that he had disengaged on medical grounds and had suffered intervening psychological illness and unfitness to discharge duties; (b) whether it was open to the Employment Court to make the award for loss of income, given the respondent’s delay in raising and/or pursuing his personal grievance and his not seeking reinstatement before 18 September 2003; (c) whether the Employment Court’s award for compensation under s 123(1)(c)(i) of the Employment Relations Act was excessive in the circumstances; (d) whether the Employment Court was wrong in its approach to contribution; and (e) whether the invoice was recoverable as a disbursement.
Held
(1) Counsel were agreed that, given that leave had already been granted on the question of “Can a voluntary disengagement under s28D of the Police Act 1958 be reversed by way of a personal grievance?”, leave should be granted on the question of “Was it open to the Court to reinstate the respondent, given that he had previously disengaged on medical grounds under s28D of the Police Act?” The Court agreed that that question met the criteria for the granting of leave. (para 10)
(2) The question of “Was it open to the Court to reinstate the respondent given that nearly seven years had passed since his departure from the police which was found to be constructive dismissal?” was more problematic, however. The finding which the Commissioner sought to challenge was essentially factual, and therefore not an obvious candidate for the granting of leave, given the restrictions of s 214. The applicant’s argument appeared to be that the conclusion was so untenable that it amounted to an error of law. The Court had some doubt that this question met the test for the granting of leave, but the Court acknowledged that the present case was a very unusual case, and that the applicant may be able to establish a point of law in the
terms outlined above if given the opportunity to mount a full argument with a detailed review of the facts, rather than the truncated argument permitted at a leave hearing.
The Court therefore proposed to reserve the question as to whether leave should be given on this ground for the main hearing. (paras 11-13, 15)
(3) The Court considered it appropriate to grant leave for the question: Did the fact the respondent disengaged under s28D of the Police Act 1958 preclude the making of an award for loss of income to the respondent? (para 16)
(4) Judge Shaw’s dismissal of this Court’s decision in NCR (NZ) Corporation v Blowes (cited below) as “not being in accord with statutory discretion” appeared to overlook the fact that decisions of this Court are binding on the Employment Court. In the Court’s view, it was arguable that she erred in law in not following that decision, and we therefore grant leave on this question, though the Court modified it so that it reads: Was the Court’s award for compensation under s 123(1)(c)(i) of the Employment Relations Act excessive, given the decision of this Court in NCR (NZ) Corporation Ltd v Blowes [2005] 1 ERNZ 932? (para 19)
(5) The issues which the applicant sought to raise about contribution were factual issues which are not amenable to appeal to this Court. The Court declined leave on this question. (para 20)
(6) The Court did not see the essentially factual matter of the invoice as being an appropriate question for leave. There was no proper evidential basis for the argument which the applicant sought to make, and in any event it had no importance other than to the parties to the present case. The amount involved was relatively trivial. The Court declined leave on this ground. (para 21)
Result:
Application allowed in part (leave to appeal) ; Costs to lie where they fall
Statutes considered:
ERA s114(1)
ERA s123(1)(c)(i)
ERA s125(2)
ERA s214(3)
Police Act 1958 s28D
Cases referred to in judgment:
Bryson v Three Foot Six Ltd [2005] 3 NZLR 721 (SC)
Carter Holt Harvey v Yukich CA42/04, 28 April 2004
Commissioner of Police v Hawkins [2008] NZCA 164
Hawkins v Commissioner of Police WC 7/08, 27 March 2008 (Recalled and reissued:
WC 7B/08, 12 August 2008)
NCR (NZ) Corporation Ltd v Blowes [2005] ERNZ 932 (CA)
Pages:
3
[975154]
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Pacific Palms International Resort & Golf Club Ltd v Smith
AC 25/08
Heard: 24 Jul 2008, Auckland
Judgment Date:
21 Aug 2008
Court/Authority:
Colgan CJ
PRACTICE AND PROCEDURE – Interlocutory issue – De novo challenge to determination of Employment Relations Authority – Nature and extent of challenge – Authority investigation – Plaintiff failed to attend mediation as Authority directed – Court called for good faith report under s181 Employment Relations Act 2000 (“ERA”) – Authority reported plaintiff had not facilitated Authority’s investigation to a significant extent but had acted in good faith toward defendant to significant extent – Whether plaintiff’s failure to attend mediation as directed by Authority could give rise to finding that plaintiff had not participated in Authority’s investigation in a manner designed to resolve issues – Plaintiff submitted failure to attend mediation could not in law amount to obstruction or failure to facilitate investigation and resolution of problem – Defendant submitted Authority was seized of matter when problem lodged – HELD – Failure to attend mediation as directed by the Authority can in law give rise to a finding under s182(2) ERA that a person did not participate in the Authority’s investigation in a manner designed to resolve issues – Plaintiff entitled to hearing de novo – Conduct most justly sanctioned in costs – Orders accordingly
This was an interlocutory judgment in a challenge to a determination of the Employment Relations Authority which held that a failure to attend mediation as directed by the Authority can in law give rise to a finding under s182(2) Employment Relations Act 2000 that a person did not participate in the Authority’s investigation of the matter in a manner that was designed to resolve the issues involved.
On 16 April 2008 the Authority issued a determination which found that the defendant had a personal grievance for an unjustified constructive dismissal. The plaintiff filed a challenge to that determination and elected to do so by a hearing of the entire matter de novo.
In its determination, the Authority noted that the plaintiff had failed to comply with the Authority’s direction to attend mediation. On that basis, the Employment Court was satisfied under s181(2) ERA that the plaintiff may not have participated in the Authority’s investigation of the matter in a manner that was designed to resolve the issues involved and called for a good faith report under s181(1) ERA. Section 182(1) – (2) provides the Court may limit the nature and extent of the plaintiff’s challenge if it is satisfied that the plaintiff did not participate in the Authority’s investigation in a manner that was designed to resolve the issues involved.
The Authority concluded that the plaintiff was obstructive of the investigation and for the purposes of s181(1)(a) ERA that it had not facilitated the Authority’s investigation to a significant extent. However, under s181(1)(b) it found that the plaintiff had acted in good faith toward the defendant to a significant extent. The determination and the report were also critical of the plaintiff’s sole shareholder and director, (R), for giving unreliable evidence.
The plaintiff submitted that a failure to attend mediation as directed by the Authority could not in law amount to an obstruction or failure to facilitate the Authority’s investigation or resolution of the issues involved. Second, the plaintiff submitted that ss181 – 182 ERA were meant to focus the Court’s attention on the conduct of the parties in facilitating or assisting the Authority’s investigation, not on non-compliance with preliminary directions. Finally, the plaintiff submitted that it was relying on legal advice when it failed to attend mediation.
The defendant submitted that the Authority was seized of the problem when it was lodged and that the Authority had a statutory duty to under s159 ERA to direct parties to mediation.
Held
(1) As to the Authority’s adverse findings of credibility against R, the Court followed the recently issued decision in Roebeck & Anor v Bradford Trust Limited (cited below) where the Court observed that simply because a party was found to have been an unbelievable witness, this alone should not affect adversely that party’s appeal rights. (para 20)
(2) The Court accepted the argument advanced on behalf of the defendant that as soon as an employment relationship problem was lodged with the Authority, the Authority was seized of that problem and was under an obligation to direct the parties to mediation where this had not been previously attempted. Mediation is an essential part of its problem-solving methodology, albeit performed by another body. (para 21)
(3) Directions to mediation must be obeyed. If they cannot be complied with, a party must apply to be excused performance of that important obligation. The Court therefore did not accept the plaintiff’s submission that a failure to attend mediation as directed by the Authority could not in law amount to an obstruction or failure to facilitate the Authority’s investigation and resolution of the problem. (paras 23–24)
(4) The Court also did not accept the argument that it was only the conduct of the parties in facilitating or assisting the Authority’s investigation of the relevant facts that could be brought to bear under ss181 – 182 and not preliminary directions. By directing mediation, the Authority was fulfilling a mandatory requirement in relation to its jurisdiction and abiding by the objects of the Act itself. The Act was designed so that the Authority should not have to investigate an employment relationship problem if a successful settlement was reached in mediation. (para 25)
(5) The Court found therefore that a failure to attend mediation as directed by the Authority can in law give rise to a finding under s182(2) that a person did not participate in the Authority’s investigation of the matter in a manner that was designed to resolve the issues involved. Whether or not a litigant had been legally advised to resist mediation or ignore a direction to attend mediation, was of no bearing on this finding. (paras 26–27)
(6) The Authority found that despite plaintiff’s failure to facilitate the investigation to a significant extent, it still acted in good faith toward the defendant to a significant extent. Although not without hesitation, the Court found that the plaintiff was entitled to proceed with its challenge by way of a full hearing of the entire matter, by a hearing de novo. The plaintiff’s conduct can and should be most justly sanctioned in costs, both in the Authority, if these have still to be fixed or if they are an issue on the challenge, and by costs on the challenge in the Court should that be necessary. (para 28)
Result:
Orders accordingly ; Costs in favour of defendant ($500)
Statutes considered:
ERA s3
ERA s3(v)
ERA s3(vi)
ERA s159
ERA s159(1)(b)
ERA s181
ERA s181(1)
ERA s181(1)(a)
ERA s181(1)(b)
ERA s182
ERA s182(2)
ERA s188
Cases referred to in judgment:
Roebeck & Anor v Bradford Trust Limited AC 18/08, 21 July 2008
Pages:
3
[975300]
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Air Nelson Ltd v The New Zealand Airline Pilots' Association Industrial Union of Workers Inc
AC 17B/08
Heard: 26 Aug 2008, Auckland
Judgment Date:
17 Sep 2008
Court/Authority:
Colgan CJ Shaw J Couch J
Appearances:
CH Toogood, K Thompson ; R Harrison, R McCabe
APPLICATION – Declarations – Strike notice – Notice requirements – Essential services – Jurisdiction – Notice stated employees intended to strike after expiry of 14 days and before expiry of 28 days – Strike notice faxed to chief executive of Department of Labour after business hours – Came to chief executive’s attention 11 days before expiry of 14 days – How period of notice must be specified in notice of intention to strike to comply with s90(1) and s90(3) Employment Relations Act 2000 (“ERA”) – Whether notice of intended strike was given to chief executive in time – Whether Court’s jurisdiction under s219 extended to strike notice requirements – If so, whether discretion should be exercised in defendant’s favour – Plaintiff submitted strike notice had to specify whole number of days before strike action – Plaintiff submitted s219 should not apply to strike notices in essential industries – Defendant submitted that required elements of s90(3) enabled employers to identify length of notice period before strike – Defendant submitted s219 extended to strike notices and should be exercised in defendant’s favour – HELD – Proper construction of s90(3)(a)(i) neither that of plaintiff or defendant – Specifying beginning and end of notice period sufficient – Under s90 notice given when it comes to attention of intended recipient – Notice not received 14 days before commencement of strike – Strike unlawful – Section 219 confers jurisdiction on Court to make orders relating to strike notices in essential industries – Discretion should not be exercised in favour of defendant – Declarations accordingly – Airline pilots
This was a successful application for declarations which declared that the defendant’s strike notices issued under s90 Employment Relations Act 2000 were invalid, the defendant’s strike action undertaken in reliance on those notices was unlawful and that s219 provided jurisdiction to the Employment Court to validate or extended time for defective strike notices in essential services but that this jurisdiction would not be exercised in the present proceedings.
On 9 May 2008, the first defendant prepared a notice of strike action to be given to the plaintiff and the chief executive of the Department of Labour (“the chief executive”). It stated that the first defendant intended to strike after the expiry of 14 days and before the expiry of 28 days of the date of receipt of the notice by the plaintiff. The strike notice was faxed to the chief executive outside of business hours on the same day. The notice came to the chief executive’s attention the following Monday, 11 days before the expiry of the 14 days.
As an air transport service, the plaintiff’s business is an essential service pursuant to Schedule 1, Part A Employment Relations Act 2000 (“ERA”). Section 90(1)(b)(i) ERA provides no employee employed in an essential service could strike without having given to his or her employer and the chief executive notice within 28 days of the commencement of the strike. Section 90(3)(a)(i) ERA provides that the notice period under s90(1)(b)(i) must specify the period of notice and be a period of no less than 14 days in the case of an essential service described in Part A of Schedule 1 ERA. Section 219 ERA gave the Employment Court the jurisdiction to extend time or validate informalities for anything authorised or required to be done under the ERA.
The plaintiff submitted that the defendant failed to specify the period of notice because it did not set out the relevant whole number of days before the scheduled commencement of the strike action. The plaintiff submitted in relation to s219 that the content and timing requirements of notices under s90 were of such importance to the scheme of the ERA that the discretion conferred by s219 ought not to be exercised to vary time or validate an otherwise informal strike notice.
The defendants submitted that the two required elements of s90(3) – the commencement date of the strike and the period of advance notice of that commencement date – were sufficient to enable an employer to identify the length of the intervening period before the strike began. The defendant submitted that if the notice was defective and given to the chief executive out of time that s219 could and should validate the defendant’s actions.
Held
(1) The proper construction of s90(3)(a)(i) was neither that proposed by the plaintiff nor that urged on the Court by the defendants. The statutory requirement was to specify “the” period of notice. What is specified must therefore be particular and accurate. (para 36)
(2) The difficulty with the formula used by the defendant was that it did not specify any particular period of notice. Rather it told the plaintiff and the chief executive only that the period of notice was greater than 14 days. It was only a parroting of the statutory formula that was well-known in all cases and did not itself specify the period of notice. The plaintiff’s proposition that the only way to comply with the statute was to specify the period of notice in whole days was too rigid. There was more than one way in which a period of time could be described or defined. An acceptable way of doing so is to specify the points in time at which the period of notice is to start and end. For example, a strike notice might record that the period of notice will begin when the written notice was received by the employer and end when the strike action described in the notice was scheduled to commence. In the Court’s view, this approach meets the requirements of the statute and does so in a way which provides certainty to the employer yet avoids unnecessary technicality which may lead otherwise clear notices to be rendered invalid by unforeseen circumstances. (para 37 – 40)
(3) The purpose of requiring that notice be given was to ensure that the persons to whom the notice was addressed were informed of its contents. Whether that has occurred in any particular case will be a matter of fact, as will the time at which that occurred. The employer and the chief executive can only be informed if and when they have had a realistic opportunity to read, comprehend, and act on the notice. Thus, the Court found as a general rule that notice will only be given for the purposes of s90 when it comes to the attention of the intended recipient. (para 42)
(4) In this case, the Court accepted that there was a custom of giving strike notices by fax. But it was artificial and wrong to say that a notice sent to the chief executive’s fax machine during times when it was very unlikely that the notice would come to the chief executive’s attention, had nevertheless been properly given at the time of sending and receipt by the unattended fax machine. In this case, the Court found that the first occasion on which the chief executive had a realistic opportunity to act on the notice given by the union was at start of business on Monday 12 May 2008. Prior to that time, the office was unattended and neither he nor any of his staff could have known or expected that a notice would be sent. It followed that notice was not given to the chief executive 14 days before the date on which the strike was to begin and that the strike action which took place in accordance with that notice was unlawful. (para 45 – 46)
(5) The words of s219 and its purpose are plain. On its face, it confers jurisdiction on the Court to make orders in relation to giving notice of a strike in an essential industry. (para 48)
(6) It would be wrong in principle to find that a statutory discretion ought never to be exercised in particular circumstances. Whether the discretion is exercised in any case will depend on the particular circumstances of that case. The issue was whether the discretion to validate the informality in the strike notice and to abridge time ought to be exercised in this case. The Court concluded that it should not for the following reasons. The strike notice was spent and the strike action that took place in reliance upon it was over. In these proceedings, no remedies were sought for past breach of s90. The plaintiff only sought compliance by the defendants with that section in future. The defendants in turn have undertaken to the Court that, if required by judgment, they will amend their procedures and conduct to comply in future with the law as found by the Court. (paras 49 – 51)
(7) While the Court decided that the statutory powers under s219 were broad enough to remedy errors or omissions in strike or lockout notices, it should not be thought by those giving such notices that they can rely upon breaches of ss90 and 94 being remedied under s219. (para 52)
Result:
Orders accordingly ; Costs reserved
Statutes considered:
ECA s69(2)
ERA s3
ERA s3(a)
ERA s3(v)
ERA s3(vi)
ERA s80
ERA s80(c)
ERA s90
ERA s90(1)
ERA s90(1)(b)(i)
ERA s90(3)
ERA s90(3)(a)
ERA s90(3)(a)(i)
ERA s91
ERA s92
ERA s94
ERA s219
ERA s219(1)
ERA Schedule 1
ERA Schedule 1, Part B
Industrial Relations Act 1973, s125(1)
Labour Relations Act 1987, 235(2)
Cases referred to in judgment:
Eagle Airways v NZALPA IUOW Inc [1998] 2 ERNZ 649
Hawkins v District Prisons Board [1995] NZAR 129
NZ Rail Ltd v NZ Combined Union of Railways Employees [1995] 1 ERNZ 84
R v Secretary of State for the Home Department, ex parte Daly [2001] 3 All ER 443
Secretary for Justice v NZ PSA [1990] 2 NZLR 36
Service and Food Workers Union Inc v OCS Ltd [2005] 1 ERNZ 717
Pages:
4
[975395]
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