ABBEY VALE ESTATE PTY LTD (Administrator Appointed) (ACN 095 003 928)

Rejection of proof of debt - Contract of employment - "Ticket cases" - Implied terms - Provision of reasonable notice - Mitigation of damage

Plaintiff entitled to six month's notice of termination of employment

Codelfa Construction Pty Ltd v State Rail Authority of NSW [1982] HCA 24; (1982) 41 ALR 367

Cohen v Nichevic [1976] WAR 183

Rankin v Marine Power International Pty Ltd [2001] VSC 150; (2001) 107 IR 117

Thorpe v South Australian National Football League (1974) 10 SASR 17

Westpac Banking Corporation v Totterdell (1998) 20 WAR 150

1 ACTING MASTER DIXON: This is an appeal by the plaintiff from the partial rejection by Mr M J Kitay, the deed administrator of a scheme of arrangement entered into by the defendant, of a proof of debt lodged by the plaintiff dated 20 June 2002 in the sum of $71,551.07. By a notice dated 11 July 2002 the proof was admitted in the sum of $11,778.85.

2 Whilst there were a number of different heads of claim in the plaintiff's proof that were rejected either in full or in part by the administrator, the appeal relates only to the treatment of the plaintiff's claim to be entitled to the sum of $42,945.32 in respect of wages. Other matters set out in the proof such as bonuses and holiday pay are not pursued by the plaintiff.

3 By way of explanation, it is common ground that the plaintiff was employed by the defendant at its vineyard in the Southwest. Following a directors' meeting on 26 November 2001 the administrator was appointed. By letter dated 7 December 2001 the administrator dismissed the plaintiff as from 3 December 2001. The plaintiff was informed that he would be paid one month's salary in lieu of notice pursuant to his employment agreement with the defendant. Thereafter the plaintiff lodged his proof of debt dated 20 June 2002 in the total sum of $71,551.07. Amongst other things, he asserted that he was employed pursuant to a fixed term contract that ran to 30 June 2002 that entitled him to the sum of $42,945.32 in lieu of notice. By a notice dated 11 July 2002 the administrator allowed the proof in the sum of $11,778.85 and disallowed the sum of $59,772.22. The administrator maintained his position that the plaintiff was entitled to only 28 days salary in lieu of notice based upon terms of employment in an unsigned contract of employment between the plaintiff and the defendant. The administrator allowed the plaintiff the sum of $5,769.23 in this respect. The amount in issue in the appeal is the difference between the sum of $42,945.32 sought by the plaintiff and the amount allowed by the administrator in the sum of $5,769.23.

4 By his amended application dated 1 November 2002 the plaintiff asserts that the administrator erred in finding that he was employed pursuant an unsigned contract of employment and then says that the administrator should have allowed the claim, either as salary for the balance of the term of the plaintiff's employment or in lieu of reasonable notice.

5 It will be apparent that the issue to be determined is whether the plaintiff was, at the date of his dismissal, employed by the defendant pursuant to an agreement that gave the defendant the right to terminate the plaintiff's employment upon giving 28 days notice, or whether he was employed pursuant to a fixed term agreement to 30 June 2002, or perhaps pursuant to some other agreement requiring the giving of reasonable notice. In order to determine this it is necessary to set out some of the background to the plaintiff's employment with the defendant. Whilst there is some dispute between the parties on the evidence, I think that the following is the case:

1. The plaintiff, in partnership with his parents and his wife, had operated a vineyard and winery business known as Abbey Vale Vineyard at Yallingup. Pursuant to an agreement dated 12 February 2001 ("the first agreement") the partnership sold the business to the defendant and the land to Jurg Arthur Hauser and Regula Hauser. Pursuant to cl 21.1 of the agreement the plaintiff and his father, Bill McKay, agreed to undertake the management and operation of the vineyard and winery "for the period ending on 30 June 2002...".

2. Thereafter the plaintiff and his father managed the winery and the vineyard.

3. In May 2001 the defendant took steps with a view to changing the basis of the plaintiff's employment at the vineyard. Whilst there is disagreement between the parties as to why this was sought to be done, I do not think that this matters. The plaintiff says that in or about May 2001, Gary Thomas, a director of the defendant, informed him that:

"... in the event of the termination of my engagement as manager on William McKay's retirement, I would be employed by the Defendant on the same terms as under the purchase agreement."

There is some uncertainty as to the timing of this conversation however the defendant does not dispute that such a conversation took place. The terms of the conversation are disputed, however, in that Thomas says that he simply informed the plaintiff that the new contract would have the same terms as to salary, bonuses and other entitlements as contained in the first agreement.

4. By a memorandum from Thomas to the plaintiff dated 23 May 2001, Thomas provided the plaintiff with a new employment agreement ("the second agreement"). In the memorandum, Thomas advised the plaintiff that he had "basically transferred your existing entitlements across to the Employment Agreement". Whilst the plaintiff's entitlements, in the sense of his salary and other benefits, remained the same under the second agreement, it differed in a number of respects from the first agreement. Whilst on one interpretation the existing agreement was for a fixed term to 30 June 2002, cl 7.3 of the second agreement provided that it could be terminated on 28 days written notice. Also, cl 8 of the second agreement sought to prevent the plaintiff soliciting any of the defendant's customers should he cease to be employed by the defendant.

5. On or about 27 June 2001 Thomas wrote to the plaintiff and his father asking that they sign an attached acknowledgement in the following terms:

"The parties to this Acknowledgement acknowledge and agree:

1. Clauses 21 to 31 inclusive of the Purchase Agreement and the engagement of William McKay and Kevin McKay as Managers cease to have effect from 30 June 2001.

2. Accordingly, the parties are released from their obligations under these clauses from 30 June 2001.

3. Kevin McKay will be employed by the Company as separately agreed."

6. On 6 July 2001 a meeting was held between Thomas, the plaintiff, Redmond Sweeney and Greg Harris, two other employees of the defendant, at which the proposed contracts of employment were discussed. Sweeny and Harris were being asked to sign contracts similar to that provided to the plaintiff. It is clear that the proposed contracts were one of a number of matters discussed at that meeting. Again there is some dispute as to what was said at this meeting. The plaintiff says that he made it clear to Thomas that the non-solicitation clause in the second agreement was not acceptable. He also deposes in his affidavit sworn 12 September 2001 that cl 7.3, which provided for termination on 28 days notice in writing, was also unacceptable to him. I do note in this respect, however, that in his affidavit sworn 26 October 2002 the plaintiff deposes that he was not aware that the second agreement provided for termination upon the giving of four weeks notice until it was brought to his attention by the administrator in December 2001.

7. In any event, the plaintiff says that in response to the concerns raised at the meeting, Thomas said that

"... it was important to finalise the terms of the draft employment contract as soon as possible and that he would discuss the matter with Jurg and Regula Hauser (who were ordinarily resident in Switzerland) and would get back to us."

8. Thomas disputes that the plaintiff ever said to him that the contract was unacceptable to him because of the non-solicitation clause, the notice provision or for any other reason. Thomas also disputes that the first agreement fixed the plaintiff's period of employment until 30 June 2002. It is common ground, however, that concerns were raised by the plaintiff at the meeting as to the non-solicitation provision. The plaintiff believed that the clause would prevent him from working in the wine industry in Margaret River should he cease employment with the company. Thomas says that having given an explanation as to the effect of the clause, he told the plaintiff that he would review its operation to ensure that that was the case. He also asked the plaintiff to provide him with a written job description for insertion in the second agreement and said that he "thought it important to finalise the terms of the draft employment contract as soon as possible".

9. Sweeny, in an affidavit sworn 26 October 2002, has deposed to Thomas having been told at the meeting of concern regarding the non-solicitation clause and also cl 3.14 of the second agreement. He says that he recalls the plaintiff saying that the clauses were unacceptable to him. Thomas, in effect, said that he would discuss those concerns with the Hausers.

10. In a memorandum prepared by Thomas following the meeting he refers to discussions regarding the second agreements and says as follows:

"I will review the provisions relating to non-competition after termination of employment. Redmond and Kevin will provide their job descriptions. Greg has already provided his.

It is desirable to finalise these employment contracts as soon as possible."

11. Subsequent to that meeting, and on 30 June 2001, the plaintiff's father and Thomas signed the acknowledgement. Thereafter there were further dealings between Thomas and the plaintiff regarding the execution of the acknowledgement by the plaintiff. Sometime after 1 August 2001 Thomas received from the plaintiff a copy of the acknowledgement signed by the plaintiff.

12. At some point in July 2001, according to Thomas, he received a job description from the plaintiff which he inserted into the second agreement. He cannot recall whether he sent a copy of that document to the plaintiff. The plaintiff says that he did not receive a copy.

13. The plaintiff continued working at the vineyard but the second agreement was never executed.

14. According to the plaintiff, possibly in September 2001, he asked Thomas what was happening regarding the second agreement. He says that Thomas told him that "we might as well wait until Hausers return to Perth in November". Thomas says that he does not recall this conversation but it is possible that it occurred. Sweeny also says that he discussed the matter with Thomas in August or September 2001, asking him what was happening with the agreements. He says that Thomas told him that the contracts were with the Hausers who would deal with them upon their return to Western Australia.

6 Before dealing with the issues I should say that one difficulty I have had with this matter is in determining whose evidence I should accept where there are differences between parties. As is apparent, the plaintiff and Sweeny on the one hand and Thomas on the other disagree entirely on certain matters. The difficulty that I have had is compounded by the fact that none were cross-examined on their affidavits and so I have not had the opportunity of seeing them. The defendant suggests however that where there is a dispute between the evidence of the plaintiff and Sweeny on the one hand and Thomas on the other, I should prefer the evidence of Thomas. As regards the plaintiff's evidence, the defendant says that I should do so because of inconsistencies between the various affidavits sworn by the plaintiff. I accept that there are a number of inconsistencies. For example, and as I have noted above, in par 15 of the plaintiff's affidavit sworn 12 September 2002, the plaintiff deposes in the context of the discussions that took place at the meeting on 6 July 2001, that:

"(T)he provisions of clause 7.3 of the draft employment contract was (sic) also entirely unacceptable to me and it was inconsistent with the terms on which I was engaged under"

pursuant to the first agreement, the clear implication being that he was, at that time, aware of cl 7.3. However, in his affidavit sworn 26 October 2002 the plaintiff says, again in the context of the meeting held on 6 July 2001, that he "was not aware that the draft employment contract was not for a fixed term but rather provided for termination on 4 weeks notice".

7 The defendant says that I should compare this to the clear and candid way in which Thomas has sought to put all information in his possession before the Court.

8 There are inconsistencies in the plaintiff's affidavits. However, despite this and on balance, I am not prepared on that basis to prefer the evidence of Thomas over that of the plaintiff where they differ in their evidence. As I have said, neither of them were cross-examined and so I have not had an opportunity to see them and form a view as to their credibility.

9 As regards the evidence of Sweeny, it is said by the defendant that where that conflicts with the evidence of Thomas, I should reject that evidence on the grounds that Sweeny has failed to disclose that he and the plaintiff are in business together. I do not consider that that in itself would be good grounds for preferring the evidence of Thomas where they differ. Again, I am not prepared to reject his evidence on that basis alone. As with the plaintiff, he has not been cross-examined on his affidavit and so I have not had an opportunity to see him and form a view as to his credibility.

10 The first issue to be determined is whether the plaintiff was employed by the defendant on terms set out in the second agreement. As I have indicated, in his amended application, the plaintiff's starting point is that the administrator erred in finding that he was employed pursuant to "an unsigned contract of employment sent to the Plaintiff by Gary Thomas in May 2001". Put simply, the plaintiff's position is that no agreement was ever reached in relation to the second agreement.

11 The defendant's position in this respect is that the draft second agreement, less the non-solicitation clause, together with the plaintiff's description of his duties inserted by Thomas into the second agreement, contained all of the terms of the agreement between the parties and that the plaintiff is bound by that agreement even though he had not executed it. The defendant relies in this respect upon the "ticket cases", namely Parker v South Eastern Railway Company (1877) 2 CPD 416 and Eastern Navigation Company Ltd v Fremantle Harbour Trust Commissioners (1949) 51 WALR 94 in asserting that the plaintiff is bound by the unsigned second agreement. It is said in this respect that the plaintiff's conduct in:

showed his assent to the second agreement save for cl 8 regarding non-solicitation. I do not accept this.

12 On the plaintiff's version of events, the condition in the second agreement as to non-solicitation was not acceptable to him and he rejected the agreement. Even on Thomas' version of events, the plaintiff raised concerns regarding the non-solicitation clause in response to which Thomas gave an explanation that he was then to consider further. Furthermore, the question of the proposed contract was left by Thomas at the July 2001 meeting on the basis that he thought it important to finalise the terms of the draft employment contract as soon as possible, suggesting that at that date at least nothing had been resolved. This is quite a different situation to the ticket cases in which it seems that the ticket or, in Eastern Navigation Company Ltd v Fremantle Harbour Trust Commissioners, the regulations, were received without comment and certainly without the receiving party indicating, at the very least, that he was not satisfied with a condition contained therein.

13 Nor do I accept that the plaintiff conducted himself as if bound by the second agreement. In the ticket cases, acceptance of the terms contained in the ticket or regulations is evidenced by receipt of the ticket or regulations and the deposit of the suitcase or the movement of the vessel into the Inner Harbour in Eastern Navigation Company Ltd v Fremantle Harbour Trust Commissioners. In the present case, however, the plaintiff's terms and conditions of employment, in the sense of salary and the like, were the same under the first agreement and the second agreement. As such his continued employment and the salary that he was paid by the defendant was not of itself evidence of his acceptance of the terms of the second agreement. The defendant says however that the duties performed by the plaintiff between July and December 2001 differed from those performed prior thereto and in effect, that the duties performed between July and December 2001 were referable only to the plaintiff proceeding pursuant to the second agreement.

14 Pursuant to the first agreement the plaintiff and his father were responsible jointly for the management and operation of the business, including both the financial management of the business and all viticultural activities. As I understand the plaintiff's position, as supported by Sweeny, prior to the retirement of his father, the management of the business fell into two areas. There was the winery and vineyard side of the business and there was the financial and marketing side of the business. The plaintiff dealt with the former and his father with the latter. The plaintiff says that that remained the case in the second half of 2001 in that following the retirement of his father, the plaintiff remained concerned only with the winery and vineyard side of the business. This is confirmed by Sweeny who deposes that the duties undertaken by the plaintiff did not change following Bill McKay's retirement. Though the plaintiff may have been nominally responsible for all management issues regarding the business prior to Bill McKay's retirement, in reality there was the division that I have referred to above. That remained the case following Bill McKay's retirement.

15 Contrary to this, Thomas says that the duties performed by the plaintiff in the second half of 2001 differed from those duties performed pursuant to the first agreement. In expanding upon this, Thomas says that the plaintiff, with his father, had direct responsibility for all management issues concerning the business. Pursuant to the second agreement the plaintiff was only responsible for the management of the vineyard and the winery, Sweeney and Harris having direct responsibility for financial administration and marketing respectively. Thomas then sets out those duties that the plaintiff was not obliged to carry out in the second half of 2001.

16 I have already set out the difficulties that I have in resolving factual disputes between the parties in the absence of cross examination. Aside from that, a further difficulty that I have is that Thomas, in expanding upon his statement that the duties performed by the plaintiff in the second half of 2001 differed from those duties performed pursuant to the first agreement, has dealt with the matter by reference to the duties that the plaintiff was or was not obliged to perform pursuant to the first and second agreements rather than what he actually did. I am concerned not so much with what the plaintiff was supposed to do in the second half of 2001 and whether there had been a change in his duties but with what he actually did and whether that is referable only to performance of the second agreement. If the reality was that the duties that he actually performed remained the same because the pre-existing informal division of duties continued, as is said to have been the case by the plaintiff and Sweeny, then it would not be the case that the work performed in the second half of 2001 was referable only to performance of the second agreement.

17 In light of these matters I am not satisfied that the plaintiff did in fact conduct himself as if bound by the second agreement. In this respect the onus is on the defendant - see Parker v South Eastern Railway Company at 425.

18 In my view, there was no agreement reached in terms of the second agreement. Following discussions at the July 2001 meeting, it was clear that, at the very least, the plaintiff was dissatisfied with one clause in the second agreement and I do not think it can be said that there was at that stage an agreement. There were no further discussions regarding the non-solicitation clause and that issue remained outstanding. Whilst the plaintiff provided a job description to Thomas who then incorporated it into a further draft of the second agreement and there were other discussions regarding the plaintiff's position with the defendant in the form of handwritten notes on correspondence from Tottle Christensen to the plaintiff dated 17 July 2001, I do not think that that results in any concluded agreement. It seems more likely than not that the position adopted by the parties was that there was little need for the negotiations to be pursued with any urgency as the plaintiff was continuing to work at the vineyard on terms as to salary and the like that would remain the same under any subsequent agreement. Further, it seems that Thomas was preoccupied with the financial difficulties suffered by the defendant. Finally, and as I have indicated above, I do not believe that it can be said that the plaintiff indicated an intention to accept the second contract by his conduct in performing duties referable only to the second agreement.

19 I conclude in this respect therefore that the plaintiff was not bound by the second agreement at the date of his dismissal.

20 I will now consider whether the first agreement remained on foot in relation to the plaintiff. As I have said, in August 2001 the plaintiff provided to Thomas a signed acknowledgement that, on its face, brought the first agreement to an end. The plaintiff's position is that that was not the effect of the acknowledgement and that the first agreement so far as it concerned his employment as manager remained in effect such that the plaintiff had a fixed term of employment to 30 June 2002.

"The parties to this Acknowledgement acknowledge and agree:

1. Clauses 21 to 31 inclusive of the Purchase Agreement and the engagement of William McKay and Kevin McKay as Managers cease to have effect from 30 June 2001.

2. Accordingly, the parties are released from their obligations under these clauses from 30 June 2001

3. Kevin McKay will be employed by the Company as separately agreed."

22 It is not entirely clear on the evidence as to the basis upon which the plaintiff executed the acknowledgement. In his affidavit sworn 12 September 2002 he deposes, in effect, that he would not have executed the acknowledgement had he realised that the terms of the second agreement were materially different from those of the first agreement. I do not understand this because on the plaintiff's own evidence, prior to signing the acknowledgement he had informed Thomas that the second agreement was not acceptable to him. In his affidavit sworn 26 October 2002 the plaintiff says that in executing the acknowledgement he was simply acknowledging that he was to be employed on terms that were yet to be agreed as opposed, I assume, to agreeing that the first agreement would be at an end.

23 In any event, what seems clear, even on the plaintiff's evidence, is that the plaintiff knew prior to execution of the acknowledgement that the second agreement was not acceptable to him and that at the very least, there would be further discussions as to its terms. Thereafter, and prior to the parties having taken the matter very much further, save for the provision by the plaintiff of a job description, the plaintiff executed the acknowledgement. Whilst there was clearly an intention at all times to employ the plaintiff on a fresh contract, I see nothing to suggest that the termination of the original contract was conditional upon the entry into a fresh contract, that the plaintiff was simply acknowledging that he was to be employed on terms that were yet to be agreed or that the acknowledgement would have no effect until such time as the proposed contract or any other contract was entered into.

24 As such, I consider that the effect of the acknowledgement was to bring the first agreement to an end. Having already found that the second agreement did not take effect, that leaves to be resolved the basis upon which the plaintiff remained in the employ of the defendant in the second half of 2001.

25 The plaintiff has suggested a number of alternatives in this respect. One such alternative is an oral agreement on the same terms as the first agreement. Such an agreement is said to be based upon the statement the plaintiff says that Thomas made to him to the effect that the terms of the proposed agreement would be the same as those of the first agreement, namely, with a term that ran to 30 June 2002. The defendant in fact disputes that the first agreement ran to 30 June 2002. The defendant relies in this respect on cl 21.3 of the first agreement which provides for a review of the plaintiff's employment "on 30 June in each year with a view to extending his appointment for further periods of 12 months after each 30 June on mutually agreed terms and conditions". The defendant says that the effect of this was that the plaintiff's employment was not fixed to 30 June 2002 but was subject to review on 30 June 2001.

26 I do not accept that to be the case but in any event, nothing turns on this point as Thomas denies having made the statement to the effect that the terms of the proposed agreement would be the same as those under the first agreement and I am not satisfied that the statement was in fact made.

27 A further alternative suggested by the plaintiff is that, based again on the statement said to have been made by Thomas to the plaintiff, there was an oral agreement in the same terms as to salary, bonus payments and other entitlements as appeared in the first agreement with an implied term that the term of the contract would be to 30 June 2002. As I understand it, the basis for implying such a term was the failure of Thomas to say that the term of the contract would be other than 30 June 2002.

28 I have to say that I have found it difficult isolating an agreement out of what is a confusing and contradictory set of circumstances and in which I doubt that the parties gave any real consideration as to the formal basis upon which the plaintiff remained in the employ of the defendant. It does seem to be the case, however, that at all times the parties proceeded on the basis that the plaintiff's salary and other entitlements would remain as they had been under the first agreement. I think the parties proceeded on the basis that the plaintiff would continue in the employ of the defendant on those terms pending agreement being reached as to the terms of a new written contract. Whether that is said to be an oral contract based on the conversation between Thomas and the plaintiff in May or partly oral and partly in writing, taking into account the memorandum from Thomas to the plaintiff dated 23 May 2001, does not matter greatly. That is the basis upon which the parties proceeded in my view and I find that there was an agreement to that effect.

29 I do not accept however that there would be implied into such a contract a term to the effect asserted by the plaintiff. As I have said, as I understand it, the basis for implying such a term is said to be the failure of Thomas to inform the plaintiff that the term of the contract would be other than 30 June 2002. In my view that is not sufficient to imply such a term - see BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266 and Hawkins v Clayton (1988) 164 CLR 539. It cannot be said that the implication of such a term would be necessary in the sense that the agreement would not be effective without it.

30 Rather, a term would be implied in law that the plaintiff was entitled to reasonable notice. This was in fact a further alternative put by the plaintiff. It is also accepted by the defendant that in the event that I find that there was a contract in existence that is silent on the question of termination, then the plaintiff would be entitled to reasonable notice. The parties also agree in general terms on the factors that ought to be taken into account in determining what would constitute reasonable notice. They differ, however, on what would, in the circumstances of this particular case, constitute reasonable notice. The plaintiff says 12 months and the defendant says four weeks and further that in the event of the period being any greater than that, then I should take into account any wages earned elsewhere by the plaintiff.

31 The factors relevant to what would be reasonable notice include the following:

(10) The expected period of time that it would take to find new employment.

(11) The period that it was likely, apart from dismissal, that the employee would have continued in the employment.

(12) What the employee gave up to join the employer in question.

(13) The employee's prospective pension or other rights.

32 In considering what would have been an appropriate amount of notice I have taken the following matters into account:

(1) The plaintiff held a senior position at the vineyard. In the original contract he and his father were to manage and operate the vineyard and the winery. In the second agreement he is described as production manager and in Tottle Christensen's letter of 17 July 2001 enclosing the acknowledgement, he is described as vigneron and chief winemaker. That is said to be a "key management role". These various descriptions show the importance and seniority of his position at the vineyard.

(2) The plaintiff's length of service with the defendant had been relatively short, having commenced only in February 2001.

(3) His salary of $75,000 per annum plus bonuses was reasonably high.

(4) As part of his remuneration the plaintiff received free accommodation and a motor vehicle. One would expect that termination of such employment would have required the plaintiff to find fresh accommodation for not only himself but also for his family. Ordinarily this would have a bearing on the amount of notice required. In the present case it may have little impact as although the evidence in this respect is a little unclear, it seems that the plaintiff owned other property in Margaret River. He in fact deposes that had he been obliged to relocate to another wine-growing area, he would have been required to sell his house and his vineyard. It may be therefore that following the termination of his employment the plaintiff and his family were able move straight into other accommodation owned by the plaintiff. Due to the uncertain state of the evidence, however, I am unable to reach any firm conclusions in this respect.

(5) The plaintiff has said that despite his experience over 13 years as a vigneron and wine-maker, as he does not have a degree in oenology, it would have been very difficult for him to find work as a wine-maker. It is difficult to determine whether that was so because following his dismissal on 6 December 2001, the plaintiff attempted to find work in the Margaret River area until only late December 2001 when he started a winemaking facility at property he owned in Margaret River. There is no other evidence as to the difficulties or otherwise of finding employment in senior positions in the wine industry in Margaret River or elsewhere.

(6) The plaintiff has also said that were he to have obtained work in the wine industry other than in Margaret River he would have been obliged to sell his property and move his family from the area.

(7) I do not consider that the plaintiff's age has any real bearing on the matter.

33 The defendant says that a fact of great significance in determining this issue is the fact that the plaintiff owned other property near the defendant's vineyard and established his own vineyard only a few weeks after dismissal. In my view, the fact that the plaintiff obtained employment a few weeks after dismissal is not relevant to the length of notice required to be given as what constitutes reasonable notice in a particular matter is to be determined as at the date when notice was given - see Quinn v Jack Chia (Australia) Ltd [1992] VicRp 37; [1992] 1 VR 567. Nor do I think that the fact that the plaintiff owned the land is of any great relevance as, according to the plaintiff, it comprised a ten-acre vineyard that was not financially viable. It is not the case that the plaintiff could simply commence work on that land. Rather, the plaintiff says that to make the property viable he had to establish a wine-making facility. To achieve that, he borrowed $700,000 from his family.

34 Taking the various factors set out above into account, it is my view that notice of six months would have been reasonable.

35 The final issue that arises in this matter concerns the plaintiff's obligation to account for any monies earned during the notice period - see Irons v Merchant Capital Ltd (1994) 116 FLR 204 at 209. There is no evidence before the Court as to the plaintiff's earnings over the period from 4 December 2001 to 3 June 2002 either from his wine-making facility or from any other source. The plaintiff sought in this respect to draw a distinction between wages earned as an employee and any monies earned by the plaintiff as proprietor of his own business. The plaintiff's position was that the latter would not be taken into account. There is little evidence as to the plaintiff's position with the new winery, namely, whether at the material time he was a partner or an employee via some corporate structure. However, it was said by the plaintiff's counsel in the course of argument that the plaintiff is a partner in the business and not an employee.

36 I do not accept the distinction sought to be drawn by the plaintiff between an employee and a self-employed person. Whilst the authorities refer to a dismissed employee obtaining further employment, I do not understand that to be employment in the strict sense as opposed to operating ones own business or being in partnership. It would seem to me to be an absurd result if monies earned by the plaintiff were taken into account had he obtained employment at a particular vineyard but not taken into account if, rather than being taken on as an employee, he had become a partner in the same vineyard or in this case, started his own vineyard. The issue is the damage suffered by the plaintiff by reason of the defendant's failure to give reasonable notice.

37 In any event, it is clear that I do not have the evidence before me to determine what, if any, earnings of the plaintiff in the relevant six-month period must be taken into account in calculating the amount due to the plaintiff. By reason thereof I am unable to assess the damages to which the plaintiff is entitled. Further evidence will have to be adduced in this respect.

38 In conclusion, I find that at the date of termination the defendant employed the plaintiff pursuant to a contract that required the defendant to give the plaintiff six months notice in writing. The defendant did not do so and so the plaintiff is entitled to recover damages calculated by reference to six months wages less any amount earned by the plaintiff over that period. Due to lack of evidence, I am not able to say what that amount is.