Cerberus Software Ltd v Rowley [2001] EWCA Civ 78 (18 January 2001)

Cerberus Software Ltd v Rowley [2001] EWCA Civ 78 (18 January 2001)

The contract clause was permissive, not mandatory; Cerberus was not obliged to pay in lieu of notice unless it elected to do so. Rowley's remedy was damages for wrongful dismissal, subject to mitigation by earnings during the notice period. The award for payment in lieu of notice without mitigation was incorrect and...

Source-derived case information.

Citation
[2001] EWCA Civ 78
Parties
Appellant: Cerberus Software Ltd; Respondent: John Anthony Rowley
Jurisdiction
England and Wales
Judgment Date
18 January 2001
Procedural Posture
Employment Appeal / Appeal From Employment Appeal Tribunal
Outcome
appeal allowed
Legal Topics
Wrongful Dismissal, Payment in Lieu of Notice, Mitigation of Damages, Unfair Dismissal
Employment Law Contract Law Wrongful Dismissal Payment in Lieu of Notice Mitigation of Damages Unfair Dismissal

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Summary, issues, holding and outcome

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Parties

Cerberus Software Ltd

Appellant

John Anthony Rowley

Respondent

Procedural Posture

Employment Appeal / Appeal From Employment Appeal Tribunal

Legal Issues

  1. 1 Whether an employee summarily dismissed for alleged misconduct is entitled to payment in lieu of notice as a contractual debt or damages for wrongful dismissal subject to mitigation.
  2. 2 Interpretation of contractual clause regarding payment in lieu of notice.
  3. 3 Application of mitigation principle to damages for wrongful dismissal.

Ratio Decidendi

The contract clause was permissive, not mandatory; Cerberus was not obliged to pay in lieu of notice unless it elected to do so. Rowley's remedy was damages for wrongful dismissal, subject to mitigation by earnings during the notice period. The award for payment in lieu of notice without mitigation was incorrect and must be replaced by damages for the period between dismissal and new employment, less earnings.

Court Disposition

appeal allowed

Orders

  • Award of £21,348.21 for payment in lieu of notice set aside.
  • Substitute award for damages for breach of contract for period from dismissal to new employment, less earnings.