RAHUL BAGCHI V THE CHIEF EXECUTIVE OF THE INLAND REVENUE DEPARTMENT CA CA666/2008

RAHUL BAGCHI V THE CHIEF EXECUTIVE OF THE INLAND REVENUE DEPARTMENT CA CA666/2008 9 December 2008IN THE COURT OF APPEAL OF NEW ZEALAND CA666/2008 [2008] NZCA 544BETWEEN RAHUL BAGCHI Applicant AND THE CHIEF EXECUTIVE OF THE INLAND REVENUE DEPARTMENT Respondent Hearing: 2 December 2008 Court: Chambers, Ellen France and Baragwanath JJ Counsel: P G Skelton for Applicant C Curran-Tietjens for Respondent Judgment: 9 December 2008 at 11.30 amJUDGMENT OF THE COURT A The application for leave to appeal is dismissed. B The applicant must pay the respondent costs for a standard application for leave on a Band A basis and usual disbursements. REASONS OF THE COURT(Given by Ellen France J)Introduction[1] The applicant, Mr Bagchi, applies for leave to appeal from a judgment of Chief Judge Colgan dismissing his challenge to the determination of the Employment Relations Authority ("the Authority"): EmpC AK AC40/08 and ARC 6/05 26 September 2008. [2] An appeal is available only in respect of questions of law which, by reason of their general or public importance, or for any other reason, should be submitted to this Court for decision: s 214 of the Employment Relations Act 2000. Section 214(1) also provides that the Court has no power to consider decisions on the construction of an employment agreement.Background[3] Mr Bagchi was dismissed by the respondent, the Inland Revenue Department, from his employment with the Department. Rather than have the applicant work out the notice period of one month, the respondent made a payment to him of one month's pay in lieu of notice. [4] The relevant part of the applicant's employment agreement, cl 4.3.1, provided that:One month's notice of termination of employment will be given by either party. This may be varied by agreement.[5] Mr Bagchi submitted a personal grievance claim alleging he had been unjustifiably dismissed. He sought reinstatement, lost remuneration and compensation for distress. In a determination dated 23 December 2004, the Authority dismissed the applicant's claim and ordered him to pay $6,000 costs. [6] The applicant (acting on his own behalf) challenged the Authority's determination before the Employment Court. The grounds of his challenge included claims of pre-determination and disparity in treatment on the part of the respondent and that he was deprived improperly of the opportunity to work out his notice period.[7] These claims were rejected by the Employment Court. The Chief Judge found that dismissal was inevitable and the process leading up to and including the dismissal was fair.Proposed basis of appeal[8] The applicant seeks on appeal to have two questions determined, namely: (a) Whether a dismissal which is in breach of the terms of the parties' employment contract can ever be justified; and (b) Whether the Employment Court erred in law in failing to give adequate or proper reasons for its decision to dismiss the applicant's claims.First issue: impact of breach of contract on dismissal[9] The substance of the argument the applicant wishes to make on this issue is that where the parties have agreed upon the method by which their employment relationship is to be terminated, an employer cannot terminate the relationship in a different way. The applicant says the only exceptions to this rule are cases of serious misconduct or repudiatory breach, neither of which are in issue here. [10] The applicant relies on cases such as Delaney v Staples [1992] 1 AC 687 (HL) where at 692 Lord Browne-Wilkinson set out four common situations where a payment is made in lieu of notice and the legal consequences of each of those situations. The four situations identified by Lord Browne-Wilkinson range from what is commonly referred to as "garden leave" to summary dismissal without the employee's agreement. [11] We do not consider this issue gives rise to a question of law in this case. The respondent is right that whether the applicant ought to have been able to work out hisnotice period involves the application of the law to the facts of the particular case. The relevant facts include whether or not the applicant agreed to accept a payment in lieu of notice or waived any rights under the employment agreement. We can illustrate the point by noting that the applicant's claim is that this is a case of summary dismissal in the fourth category identified by Lord Browne-Wilkinson leading to a breach of contract whereas the respondent describes the case as one of "garden leave" which does not give rise to a breach of contract if the period of notice is reasonable. [12] This question may also be outside the scope of s 214 because it will involve the construction of the employment agreement. As this Court said in Ogilvy and Mather (New Zealand ) Ltd v Turner [1995] 2 ERNZ 398 at 406 in the context of a discussion of the four categories from Delaney v Staples, "[e]ach case will depend on the terms of the particular contract".Second issue: adequacy of reasons[13] This issue could give rise to a question of law. However, in this case it is plain there was no error of law in the Chief Judge's decision in this regard. The Judge carefully traversed the relevant facts and addressed the claims of pre- determination and disparity of treatment. This was a case where the Judge concluded there was no objective evidence on which these claims could be made out. The Chief Judge in reaching that conclusion discussed in some detail the steps taken by the respondent prior to dismissal including the provision of formal training, the feedback and performance appraisals and the manner in which the various performance issues were undertaken. The Judge expressly dealt with the aspects of the claim for which some explanation was required from the respondent, for example, the extent to which requests for further training had been declined and the reasons for that. There was nothing further that needed to be said.Postscript[14] We note with concern that the decision in this case was delivered by the Chief Judge some 33 months after the hearing. In those circumstances, we have considerable sympathy for the applicant's sense of grievance as to how his claim has been dealt with. [15] There is authority for the proposition that delays of this length can provide a basis for an appellate court to take a much closer look, for example, at decisions about the credibility of witnesses: see, for example, the discussion in Goose v Wilson Sanford & Co [1998] EWCA Civ 245 at [112] and [113] and Cobham v Frett [2001] 1 WLR 1775 at 1783 – 1784 (PC). However, although the effect of the delay was raised by the Court in the course of the hearing of the present application, the applicant did not seek to rely on the delay in itself as forming a point of law. That may be because it was considered such an approach would be better addressed in the context of a review under s 213 of the Employment Relations Act or, perhaps because it was not a case turning on issues of credibility as such. [16] Whatever the reason for the approach taken, in the end, although the delay is regrettable we have concluded that the applicant has not met the test in s 214 of the Act.Costs[17] The respondent is entitled to costs in terms of the Court of Appeal (Civil) Rules 2005, r 53G(1).Solicitors: Russell McVeagh, Auckland for Appellant Crown Law Office, Wellington for Respondent