HASTINGS v J H CORPORATE SECURITY SERVICES PTY LTD No. SCGRG-00-436 [2000] SASC 216

The plaintiff had been employed by IRW Protective Services Pty Ltd ("IRW") as a security officer. He began working for IRW in September 1997. On 30 April 1999 the defendant acquired IRW. The plaintiff was thereafter employed by the defendant. On 5 May 1999 the defendant terminated the employment contract with the plaintiff. It paid him two weeks wages in lieu of notice. On 23 November 1999 the plaintiff instituted proceedings in the Magistrates Court claiming damages on the ground that the defendant had not given him sufficient notice. The plaintiff alleged that two weeks notice was not reasonable notice. He claimed six months wages in lieu of notice as damages for breach of the contract of employment.

The defendant filed its defence on 24 November 1999. It contained a number of grounds. On 9 March 2000 the defendant applied for an order for summary judgment and, in the alternative, that the plaintiff's claim be struck out. The magistrate acceded to the application by the defendant for summary judgment. The plaintiff appeals from that order.

For the purposes of the defendant's application, it was common ground that, when employed by IRW, the plaintiff's contract of employment was an Australian workplace agreement made pursuant to the Workplace Relations Act 1996 (Cth). By virtue of s 170VS of that Act, the defendant became a party to the workplace agreement when it replaced IRW as the plaintiff's employer. It was thereby bound by the workplace agreement.

The workplace agreement makes express provision for termination of employment. For present purposes it is sufficient to refer to clauses 40.1, 40.2 and 40.5 of the agreement.

"40.1 We may terminate your employment at any time in the following circumstances: 40.1.1 Serious misconduct by you; 40.1.2 A fundamental or serious breach by you of our policies and practices as issued by us (or on our behalf) from time to time; or 40.1.3 A fundamental or serious breach by you of this Agreement; or 40.1.4 A failure by you to perform to a satisfactory standard on a consistent basis (so long as you have been told the problems with your performance and been given an opportunity to improve to the required standard); or 40.1.5 Failure by you to perform to a satisfactory standard at any time during your probationary period; or 40.1.6 Conduct by you which at common law would justify instant dismissal; or 40.1.7 Redundancy or retrenchment; or 40.1.8 The natural cessation of a casual engagement or contract for a fixed period. 40.2 Termination by us of this contract (except for reasons of redundancy or retrenchment) may be summary where this would be justified at common law, otherwise you are entitled to the following notice or payment in lieu thereof provided that you are a permanent employee; 40.2.1 Less than one year service - one week. 40.2.2 More than one year but less than three years service - two weeks. 40.2.3 More than three years but less than five years service - three weeks. 40.2.4 More than five years service - four weeks.

In addition to the above you are entitled to an additional weeks notice if you are over 45 years of age and have at least two years service with us.

... 40.5 You may terminate your employment at any time by giving us not less than two weeks notice in writing in the case of a permanent employee, or one days notice in the case of a casual employee. Where you give us notice, we may choose to pay you in lieu rather than allow you to work out your notice."

There was no suggestion on the application for summary judgment that the defendant was entitled to dismiss the plaintiff summarily. The defendant's case essentially turned on the terms of clause 40.2 of the workplace agreement. The defendant contended that, as the plaintiff's length of service was between one and three years, the plaintiff was entitled to two weeks notice. The magistrate concluded that the parties were bound by the workplace agreement. He also concluded that the plaintiff was entitled to two weeks notice under the agreement. He therefore determined that there was no breach of the agreement and made the order giving judgment for the defendant.

The plaintiff's claim against the defendant was grounded on the fact that two weeks notice was not reasonable notice. As I have said, the plaintiff sought six months wages in lieu of notice as damages for an alleged breach of the contract of employment. Mr Britton, who appeared for the plaintiff, submitted that it was an implied term of the agreement that there should be more than two weeks notice. He submitted that the meaning of clause 40.2 was not clear and that there was room for the implication of such a term.

The difficulty inherent in this argument is that it seeks to imply a term into the workplace agreement in the face of express terms concerning the termination of employment. Although clause 40.2 might have been expressed more clearly, it is apparent that its intention is to provide that the employer is entitled to terminate the employment of an employee provided that the employer gives the period of notice proportionate to the service of the employee as provided in clauses 40.2.1 to 40.2.4. Reference to clause 40.5 shows that this was an agreement which was capable of being terminated on either side so long as the specified period of notice was given. There is no room for any implied term of the kind which Mr Britton seeks to introduce. The defendant gave the plaintiff two weeks pay in lieu of notice. It did not, therefore, act in breach of the workplace agreement.

Mr Britton also submitted in the course of his argument that there was an implied term in the agreement to the effect that when terminating the services of an employee the employer had to act in good faith, that is to say, he had to have some kind of reasonable ground for terminating the employee's services. That claim does not appear in the plaintiff's particulars of claim. In any event, there is no room in this agreement for the implication of such a term. This agreement is like many agreements of its kind which provide for termination on either side or the giving of a specified period of notice.

Rule 8 of the Magistrates Court Rules provides that the court may order summary judgment if the court is satisfied the plaintiff does not have a good action or defence on the merits on any possible view of the facts or law. The rule is similar in operation to Rule 25.04 of the Supreme Court Rules. The circumstances in which such an order will be made are well settled. The jurisdiction will be exercised with great care and only when it is clear that an action is devoid of merit and the action could not succeed on any possible view of the facts or the law: General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125.

It is clear from the reasons of the learned magistrate that he was aware of the correct test for determining whether it was appropriate to order summary judgment. As already stated, the terms of this agreement are quite clear and there is no room for implying either of the terms for which Mr Britton contends. For these reasons, there is no ground on which to interfere with the order of the magistrate dismissing the plaintiff's claim. The appeal must therefore be dismissed.