83 While it is true that these principles were established in cases which did not concern employment, but rather other arrangements under which work was performed, they have application to all proceedings brought under the section. While the resolution of each case must turn on its own facts, the principles to be applied by the Court to the section are constant.
84 In this case the claim advanced is not concerned with a failed business venture, but rather with the terms of an employment contract. It is not that the provisions of any applicable award were not adhered to which is the subject of complaint however. Nor is it that the employee was treated inconsistently with other employees, or on a basis inconsistent with standards in the relevant industry. This was also not a case where it could be found that the parties stood in unequal positions vis a vis each other, having in mind matters such as their experience or circumstances. Indeed, one of the respondents' initial concerns when considering employing Mr Cave was whether he could accept reporting to Mr Labraga, his junior in years and business experience, particularly given his previous experience as the managing director of a company.
85 It was true that Mr Cave took up employment with the respondents at a time when he had decided that the needs of his family required him to return to work in the finance industry. Employment with the respondents was, however, only one of the opportunities which he investigated at the time and he satisfied himself that it offered better prospects, having in mind that both that employment and running his own business as a Mortgage Choice franchisee involved remuneration on a commission only basis, but Mortgage Choice required him to pay a franchise fee and to bear his own business expenses. Indeed, Mr Cave remained of that view even when Mortgage Choice later offered to drop its franchise fee, if he agreed to join it rather than taking up employment with the respondents. Mr Cave declined that offer.
86 This decision is explained by the parties' view that the employment would be a senior one, in a long lasting relationship, with mutual financial benefits to each of the parties in the longterm. That expectation failed to materialise, on the evidence, plainly as a consequence of the steps taken by the applicant.
87 The trigger for the finding of unfairness, on the applicant's case, was that the employment was effectively terminated by the respondents - see Smith v Director General of Education (1993) 51 IR 204 at 219. Alternatively, there was a constructive dismissal. The law as to this topic is also well settled - see Allison v Bega Valley Council (1995) 63 IR 68. I have not been able to comfortably conclude, on the evidence, that the facts here may properly be viewed either as a termination by the respondents or as a constructive dismissal.
88 This conclusion flows from the circumstances in which the discussion on 6 May arose, as well as what was there said. This was reinforced when viewed in the context of Mr Cave's establishment of a competing business, contrary to his agreement with the respondents and utilising its information and documents in that endeavour.
89 I accept the evidence of Mr Labraga as to what occurred on 6 May, particularly that it was not his intention to dismiss Mr Cave in the discussion in question. On Mr Labraga's evidence it was Mr Cave who raised the topic of him leaving in that discussion, but having raised it, nevertheless, still had the option of telling him he preferred to remain in the respondents' employment. Had he done so, Mr Labraga would have accepted his decision. Having in mind the parties' relationship to that point, Mr Labraga's evidence was entirely plausible, and I accept it. In that light, it can be seen that these circumstances arose out of steps Mr Cave was considering taking, rather than the respondents. On the evidence, it must be concluded that the termination was not brought about by the respondents and was not designed to achieve their ends.
90 On 6 May, when Mr Labraga asked Mr Cave why his morale seemed so down, he was informed that Mr Cave was considering leaving. He was not confident, so he said, that he would meet his budget. At that time he had however, in fact, already investigated establishing his own business, by entering into a relationship with Mortgage Professionals. He had discussed the prospect with his wife. That this investigation and consideration was very well advanced indeed was demonstrated by the fact that he entered the relationship and commenced his own business the following day, armed with the respondents' confidential records and documents and utilising a corporate vehicle acquired by the respondents, at his instruction, for the purpose of the joint venture between them, which had come to nothing in the meantime.
91 I observe as to this entity that while Mr Cave denied in his affidavit evidence that the corporate vehicle had been acquired for the joint venture by Mr Pomfret on his instructions. In cross examination he conceded that those instructions had been given, because the letter in which he had done so was produced. That he also believed that this was a corporate vehicle which he controlled and was then available to him for the commencement of his new business at the time he swore his affidavit in these proceedings, was also revealed by earlier evidence which he had given in the Supreme Court proceedings, which he also accepted, when that affidavit was shown to him. This was yet another illustration of the unsatisfactory nature of the evidence given by Mr Cave, seemingly, in these proceedings, designed to conceal the fact that he was well prepared to establish his own business when his employment came to an end.
92 That the respondents were not the real and effective initiators of this termination, was also apparent on the evidence. (See Allison at p72-73). The competing versions of the conversation of 6 May were earlier set out. Mr Cave's immediate acceptance of Mr Labraga's observation: 'Well maybe the best thing for you is to finish today. I am not sure how long you will decide to be with us and we need to do everything possible to continue to support and maintain the referrer base', suggested nothing other than that Mr Cave had, in reality, already decided to leave, consistent with what he told Mr Labraga would have happened several days earlier, if Mr Labraga had then asked him as to his whereabouts at a time when he should have been in the office.
93 Even Mr Cave's version of what Mr Labraga said to him leads to no different conclusion. When Mr Labraga put to him that it might be better if he left, Mr Cave responded with '… well that's fine as far as I am concerned.' Mr Cave denied this, on his evidence asking instead whether he should work out his notice. Mr Labraga could not recollect such a question being asked, but did not deny that it might have been. Nevertheless, on his evidence, he was left with the impression that the employment had come to an end because of Mr Cave's desires, rather than his own. As I have already noted, I am firmly of the view that the conflict is to be resolved by Mr Labraga's evidence being preferred. Mr Cave's evidence as to the comments he made, however, reinforced the conclusion I have reached.
94 The discussion, in context, leads inevitably to the conclusion that the submission put for the respondents by Mr Magee must be accepted. Mr Cave had long been the managing director of a company operating in the money market. His evidence that he asked Mr Labraga if he had to work out his notice, demonstrated an understanding that, having taken a step to terminate his employment, he was obliged to work out his notice and was enquiring whether the respondents required him to do so. They did not. That concession by the respondents does not have the effect of making Mr Cave's decision to leave his employment that of the respondents. That it was of concern to Mr Cave that he might be required to work out his notice was understandable after all, given the establishment of his own business, which his conduct around this time confirmed. That the respondents did not require Mr Cave to give them notice of his departure, ought not now lead to the result that they should be required to pay him as if they had done so.
95 In light of this evidence, I am not of the view that this contract was terminated by the respondents, or even by the applicant, but as the result of the respondents' treatment of him, so as to make them the effective initiators of the termination. Nor am I of the view that this contract, as it was formed or performed, was unfair in the way that term must be understood having regard to the provisions of s105 of the Act. Mr Cave always understood and was content to take a commission only arrangement in the short term, having regard to long term gains, especially trail commissions, payable whilever a loan persisted and the employment remained on foot.
96 Once he went onto a salary basis, the commission structure altered, with the introduction of targets before commission became payable. I do not accept that Mr Cave genuinely held a concern that he would not meet those commission targets. On the one hand, his performance during his employment with the respondents was not good and compared poorly to that of Mr Balmer, whose employment had become a source of dissatisfaction to him. This led to the introduction of commission payments to Mr Cave, flowing from Mr Balmer's loans. On the other hand, his earnings in his own business conducted in competition with the respondents and utilising its referrer base, depended also on commissions flowing from loans written, in some cases at least, at not dissimilar rates of commission. Mr Cave's ability to write such loans evidenced a dramatic improvement, once he was working in his own business. If Mr Cave had truly doubted his ability to generate such commission earnings in this industry, it is difficult to imagine that he would have launched his own business, dependent entirely on that ability.
97 How it might seem to be more attractive to Mr Cave to have his own business, once he had been trained and had experience in this industry and where he would have the benefit of the whole of the commission payable by a lender on loans which were approved, together with trail commissions, can be readily understood. After all, Mr Cave did not regard himself as bound by the restraint and confidentiality provisions to which he had agreed and was seemingly untroubled by his use of the respondents' confidential information and documents to establish his own competing business. He believed he could not only compete with the respondents, but could do so by taking from them the information as to referrers which his work had built up. As I have found, this conduct assists in the resolution of the question as to who terminated this employment. It also throws light on the fairness of the contract - said to have been made unfair by the respondents' removal from Mr Cave of the long term benefits of the employment.
98 The evidence can only lead to the conclusion that the employment came to an end as a result of Mr Cave's conduct and that the respondents did not in fact deprive him of anything. To the contrary, he sought to deprive the respondents of information and other material which affected their long term earnings and necessitated their approach to the Supreme Court for relief.
99 That the respondents, as a result, have been successful in restraining Mr Cave from further damaging their business and might yet seek an amount of profits or other damages from him does not assist his case. To my mind, those circumstances provide a singularly inappropriate basis upon which any relief in favour of Mr Cave pursuant to s106 of the Act could be based.
100 While the establishment of his own business in competition with the respondents might be perfectly understandable from Mr Cave's point of view, it can hardly provide a proper basis for either a finding of unfairness in the contract or for the exercise of a discretion in his favour, on the evidence advanced here as to the original basis of his employment by the respondents.
101 Having concluded that the contract was not an unfair one, it is strictly unnecessary to further consider whether, even if it were unfair, the Court would exercise a discretion in favour of Mr Cave. The way in which the discretion to make an order in favour of an applicant should be exercised, once it is found that a contract offends the section, has often been considered. In Autobake (in a case where the benefits of an award were sought), it was said, for instance, at pp29-30 by the Industrial Commission in Court Session, that:
'Whereas no moral distinctions between the parties need be drawn when dealing with the initial question arising, namely, whether or not the contract offended again s88F(1)(d), the discretions which then arise under the section require for their exercise more than a mere comparison between award rates and actual remuneration and the circumstances that a calculated business risk, advisedly taken, has proved unsuccessful. Where such a calculated risk is taken it is not intended by s88F that the other party should become a guarantor, as it were, that the business will be successful, or that the party performing the work will receive at least the rates of pay he would have received had he been an employee. Each case has to be considered on its own merits and the discretion of the Commission exercised accordingly.'