An issue about long service leave was decided in favour of the appellant and was not subject to review on this appeal.
18 Her Honour considered separately the fairness of the contract in relation to redundancy pay and notice and concluded that there was no unfairness warranting the making of a money order in favour of the appellant. In relation to the claim for 12 months' notice, her Honour noted that there was no provision in the contract and the question was: What would be reasonable notice under a term implied at common law?
19 Essentially, her Honour concluded that it ignored reality to overlook the period between June 2001 and July 2001, when the sale was announced and progressed and when the contract with the respondent terminated on 28 September 2001, with only ten days actual notice being given, as throughout this period the appellant was aware of the sale and its consequences. In this period, he had been offered ongoing employment with Elders. Her Honour did accept that, while in early June 2001 notice of the sale had been given, it was not until mid-September 2001, that the precise date of termination was known. Nevertheless, throughout this period there were discussions as to ongoing employment with Elders. Having recognised the "reality" of that situation, her Honour noted that three months' notice might have fallen at the lower end of the scale for fair notice. Nevertheless, the practicalities had to be considered before making an order varying the contract: even if it could be concluded that only 10 days' notice had been given, the reality was that the entire situation had still to be considered. That reality included the fact that, despite protesting at not being paid redundancy, the appellant was offered and accepted ongoing employment and continued working in the business after 28 September 2001 on a basis that was financially advantageous to him, even though he regarded it as a temporary measure pending finalisation of the franchise agreement. It was noted that his initial salary under these arrangements and his February 2002 remuneration were, if anything, an advantage to the appellant.
20 Her Honour then approached the issue on the basis that, in a transmission of business where continuing employment on similar terms had been arranged, questions of breach of contract for failure to give notice often did not arise because of the operation of the principle of mitigation, with the employee mitigating any loss by virtue of that employment. The appellant argued that there were two distinct periods: immediately after 28 September 2001 and March 2002, where arrangements were entered into whereby the appellant was employed but importantly, it was argued, the mitigation principle should not apply because the employment was not with Elders but was with a franchisee, that it was temporary pending finalisation of a franchise, that it possibly involved a demotion in not having responsibility for the Cowra office, and that the franchise arrangements may not have given the appellant the same flexibility he had enjoyed when employed by the respondent. Franchise arrangements were emphasised as being distinctly different to employment, involving different responsibilities and therefore should not be considered under the application of the mitigation principle.
21 Her Honour rejected these arguments, stating that the requirement of s 106 (6) regarding mitigation could not be ignored. Her Honour saw considerable public interest in companies selling their businesses as going concerns arranging for ongoing employment for their employees: while there was dislocation, continuing employment was a preferable outcome. Her Honour concluded that, regardless of complaints of the temporary nature of some of the employment and the failure to pay redundancy pay, in fact, the appellant was employed in almost the same way and to no financial disadvantage for a period that extended for five months - to the end of February 2002. During that period, any loss was entirely mitigated. Her Honour was of the view that five months' notice would have been fair notice in the circumstances of his employment, having regard to the appellant's age, position, his remuneration, the circumstances in which he came to be employed and how and when his employment came to an end. Her Honour also referred to the four month period when the appellant effectively operated as a franchisee until he abandoned that arrangement without notice. It was noted that, if that period was taken into account, then it was beyond any doubt that the appellant had mitigated all of his losses during that period of notice -assessed even on the most generous terms conceivable.
22 In relation to redundancy, her Honour recorded the appellant's contention that he had never been offered employment with Elders but only to take up a franchise and that the work he performed was merely temporary while these arrangements were being considered. The promise of ongoing employment with Elders therefore never eventuated. Her Honour found her decision in Re Government Cleaning Service (Privatisation) Award (No 2) (1994) 55 IR 199 of assistance in determining what was a redundancy and the circumstances in which an award for redundancy would be made, noting that in test case provisions and statutory provisions, redundancy pay would not normally be available in cases of succession, assignment or transmission of business. Her Honour was of the view that similar considerations applied to the present case. It was noted that the terms and conditions of the new employment proposed with Elders were not reduced but enhanced and superannuation was unaffected. There were none of the disadvantages which had been identified in the Government Cleaning Service (Privatisation) Award case.
23 A further issue in this case was the fact that the respondent argued that it was not its conduct but the conduct of Elders that had resulted in the appellant not obtaining ongoing employment - these were circumstances which would not warrant orders being made against the respondent. The appellant argued that the respondent should be held to account for the resulting unfairness because it had stood by when it became apparent that Elders did not propose to offer him ongoing employment in breach of the sale agreement. At this point, her Honour noted that the respondent in its evidence understood that ongoing employment, in fact, had been offered and would continue to be offered to the appellant although he would be given a choice of taking employment or a franchise. The appellant's evidence was that in September 2001 he had been advised that the written offer of employment was not made to him as manager, but was available only to the support staff and that the appellant had to decide whether or not he wanted to take up a franchise. That contention was contained in the appellant's affidavit in reply and was not dealt with by the evidence of the respondent: as it turned out, the person alleged to have made that statement was unable, because of illness, to give evidence and the statement by the appellant was not subjected to cross-examination. Her Honour appears to have accepted that this was the appellant's understanding but had difficulty in accepting that it reflected what was actually occurring in the negotiations between the parties. Her Honour's view was that there was much room for misunderstanding in these discussions and account had to be taken of the terms of the sale agreement and the various written statements by Elders offering ongoing employment.
24 Her Honour's view on the fairness of the arrangement was influenced by the fact that the respondent had determined not to pay redundancy pay in circumstances where it had made arrangements in the sale agreement for ongoing employment with the purchaser of its business. Further, the appellant had actually continued working with Elders after being terminated by the respondent, allowing for the fact that this employment continued while there were negotiations as to the terms of a franchise that the appellant might take up with Elders. Her Honour noted that there was no suggestion that the appellant suffered any adverse consequences from the sale such as hardship from unemployment or loss of non-transferable credits. The only losses arose from the starting up of his own business which was his decision and could hardly be laid at the feet of the respondent. Redundancy was concerned with consequences of termination for the employee, especially where unemployment resulted or the accrued benefits of the former employment were lost - this did not apply to the appellant. The focus of redundancy pay was to compensate employees for loss of non-transferable benefits and for the inconvenience and hardship caused by termination. In all the circumstances, these issues did not arise in relation to the appellant.
THE APPEAL
25 There was no issue raised by the parties contesting the views expressed by the Full Bench in King v State Bank (NSW) (No 2) (2002) 126 IR 407, namely that the appeal was an appeal stricto sensu and was directed at correcting error. The Full Bench was not at liberty to simply substitute its own decision for that made at first instance. Further, pursuant to the provisions s 188(1) it was necessary for the appellant to obtain leave to appeal.
26 The focus of the appellant's case on appeal was that her Honour was in error in effectively holding that comparable alternative employment was offered to Mr English. A central plank of that argument was said to be her Honour's error in rejecting or refusing to accept the appellant's evidence in his affidavit in reply to the effect that he had been advised by Elders that he would not be offered employment but had to decide whether or not to take up a franchise. Apart from the issue of what use was to be made of this piece of evidence, the appellant conceded that there were very few facts in dispute.
27 Of some significance for this appeal is that the appellant accepted that the following matters were made out on the evidence:
(a) the sale of business agreement provided that Elders were to offer employment to the appellant and other employees on substantially the same terms and conditions;
(b) the appellant was offered a franchise by Elders which involved purchasing and operating a business in Bathurst;
(c) on 18 September 2001, the respondent formally gave 10 days' notice of termination of employment to the appellant;
(d) the appellant received no termination payments from the respondent;
(e) from 1 October 2001 until February 2002, the appellant was employed to perform similar work for similar remuneration. While the identity of this employer was not clear, the respondent informed him that he would be employed through the Elders' agent for the Bathurst region and was also informed by Elders that the Orange franchisee would pay him until the franchise was finalised;
(f) in about February 2002, the appellant reached an understanding with Elders, subject to checking and a formal contract, to operate the Bathurst franchise. This agreement, if formalised, required the appellant to pay Elders $254,000 over ten years;
(g) between March and July 2002, the appellant continued to work in Bathurst under that understanding; his remuneration from Elders was similar to the remuneration he had received as an employee of the respondent;
(h) in July 2002, the appellant ceased working in the Bathurst office of Elders with no formal franchise agreement being signed because of what the appellant regarded as significant differences between the original offer as agreed and the franchise document tendered to him.
28 The appellant continued his assertion that at no time was he offered employment by Elders on either substantially the same terms and conditions or at all. The validity of this assertion turned upon a consideration of the arrangements proposed by Elders and what actually occurred to the appellant after 28 September 2001. The appellant also argued that there were only 10 days' formal notice because the notice to staff of the sale did not specify a date for termination of employment: therefore, her Honour was in error finding that three months' notice was given. The appellant accepted that his earnings remained approximately the same while the franchise was being negotiated, on and off, over approximately nine months after termination but it was the unique circumstances of this case that required those earnings not to reduce what would otherwise be payable in lieu of notice - any adjustment due to mitigation ought only include earnings after the appellant's relationship with the business was finally severed in July 2002.
29 The appellant's case then concentrated upon what were alleged to be errors made by her Honour: it was said the findings that after September 2001 employment was with Elders, that the employment was not temporary and that the appellant left the alternative engagement voluntarily were findings that were not open on the evidence. Indeed, the appellant went so far as saying that her Honour wrongly rejected his evidence in reply, that he had been told by Elders that the offer of employment was not open to him as a manager but only applied to the staff, and that he had to make up his mind whether he wanted to be a franchisee or not. This last error was said to be compounded by the fact that the appellant was not cross-examined upon this evidence, the respondent did not contest it and that there remained no basis therefore to reject the evidence.
30 In dealing with these submissions, it is necessary to keep in mind the nature of the jurisdiction under s 106 exercised by the Court and to understand how her Honour approached this application. It seems abundantly clear from the terms of her Honour's judgment that she was adopting a global approach to what actually happened to the appellant in assessing whether the contract or any associated arrangement was unfair in its terms or operation. Her Honour accurately recorded the evidence called by both sides, including the evidence critical to the appellant's case where the appellant says he was advised that employment was not open to him with Elders but only a franchise. Her Honour spoke of looking at the reality of the matter and thereby disclosed an intention not to be diverted by technicalities but rather looking at all the circumstances for their general effect in assessing whether or not there was unfairness. Such an approach demonstrates no error: for nearly 40 years the Court and its predecessors have been guided by the words of Sheldon J in Davies v General Transport Development Pty Ltd [1967] AR 371 that the provision provides, in appropriate cases, the power to depart from the classic principles of contract law and to deal with "arrangements" between parties whether or not they have formally entered into a contractual relationship. Nor is the Court involved in a rigid exercise of awarding damages calculated on the strict application of common law principles although the approaches of the law in a variety of fields often provides guidance for the just disposition of an application and the making of a money order that is just in the circumstances of the case, once unfairness has been disclosed in the arrangements between the parties: see, for example, Westfield Holdings v Adams (2001) 114 IR 241 at 282-284.
31 In relation to the issue of reasonable notice, her Honour noted that, in fact, for a period of five months the appellant continued to be paid by the respondent because of arrangements of an interim nature made with Elders. Her Honour expressed the view that a period of five months as notice was not unreasonable and here, looked at broadly, there was the continued employment of the appellant by the respondent until the end of September 2001, the continuation of that employment with Elders being serviced by the respondent until March 2002, then the appellant's work for Elders until the breakdown of negotiations on the taking up of a franchise and the termination of that arrangement in June 2002. During this period the appellant accepts that he was not paid less than when he was employed directly by the respondent. During all of this time, the appellant was aware that the business had been sold although the precise date of termination of employment was not known until mid-September 2001 when 10 days' notice of that date was given.
32 Even though the appellant was working during this period, her Honour was satisfied in a general sense that he had adequate notice - during this period it was open to the appellant to find some other suitable employment or employment with which he was comfortable. Although it may not be surprising that he chose to stay with the work he knew while the details of the sale were worked out and also the details of a franchise, nevertheless, in a general sense, there was a period between five months and almost one year during which the appellant had notice that his employment was to terminate. The principle of notice does not require just the payment of salary in lieu of notice as actual notice may be given and worked out, although recent experience suggests that this has become a less frequent occurrence.
33 Quite apart from those considerations as to notice, her Honour turned to consider the extent of mitigation pursuant to the provisions of s 106(6). That provision requires the Commission in making an order under s 106 to take into account whether or not the applicant took any action to mitigate the loss. For a period of four months, the appellant continued to work for and be paid by the respondent followed by work with the Elders' franchisee. Between March 2002 and June 2002, the appellant worked with Elders. During the entirety of this period. the appellant accepts that he was paid no less than the remuneration available to him under his employment with the respondent as at June 2001. Her Honour concluded that there was no loss suffered by the appellant and that there were no reasons why those payments made to the appellant should not be taken into account in mitigation, resulting in no order being required for the payment of money to the appellant on account of appropriate notice.
34 It was submitted that from June 2001 the well settled world of the appellant had been overshadowed by uncertainty both as to when his employment would actually cease with the respondent and what precisely would be his position with the purchaser. Accepting for the moment the appellant's arguments that he was never offered employment with Elders but only a franchise, it was said that this form of engagement was so far removed from employment that it called into question the appropriateness of taking into account the sums actually paid to the appellant during this period. While it may be readily accepted that the requirement to purchase a franchise, to become an employer and to shoulder the responsibility of running a business is fundamentally different to the continuation of a simple employment relationship, such a conclusion is not conclusive when considering the application of the principle of mitigation in s 106 proceedings.
35 It is plain that the assessment of appropriate compensation under s 106(5), and also under s 106(6), involves an act of judgment on the part of the trial judge where the general law principles as to mitigation of damages are relevant but not decisive as to what award is made. In any event, the authorities as to mitigation make clear that while the duty to act reasonably to mitigate damage does not generally require an employee to take employment of a different or inferior kind, that part of the rules of mitigation known as the rule as to avoided loss, or mitigation in fact, means that where an applicant actually avoids loss by obtaining other employment (or earnings), the earnings will reduce the damages or compensation even though the non-acceptance of the other employment would not have constituted a failure to mitigate: relevant authorities include Collier v Sunday Referee Publishing Company Ltd [1940] 2 KB 647 at 653, Hill v C. A. Parsons & Co. Ltd [1972] Ch 305 at 314 and Yetton v Eastwoods Froy Ltd [1967] 1 W.L.R. 104 at 120 which are usefully discussed in Macken et al, Law of Employment, Fifth edition, 2002, at 312 - 313, Freedland, The Contract of Employment, 1976, at 261ff, Freedland, The Personal Employment Contract, 2003, at 362ff and Treitel, The Law of Contract, Eleventh edition, 2003, at p 980.
36 Thus, in the normal course of employment, a person who loses their employment might take up any number of positions, including consultancies on their own account, but what is earned in those endeavours will frequently be taken into account as mitigating the loss, in a practical sense, and reducing the amount of a money order made on the basis of the requirement to provide reasonable notice. On this approach, the details of the manner in which that work was arranged is usually of little moment - irregular and small payments might be disregarded in the exercise of the discretion to make a money order but substantial amounts earned during the period under consideration are likely to be taken into account and serve to reduce the money order made in favour of an applicant. This is such a case and her Honour made no error in the application of the principle of mitigation. The appeal therefore fails in relation to the failure to provide reasonable notice.
37 In relation to the redundancy claim issues of appropriate severance need to be considered separately from the question of notice. In the Termination, Change and Redundancy Test Case (1984) 8 IR 34, it was stated that there were a variety of factors that had been identified as relevant in awarding redundancy, including the mitigation of hardship necessarily inherent in the retrenchment of employees, the financial hardship or fear of it caused by the interruption to employment and disruption to a worker's routine in society including the loss of security of employment. There can be little doubt that in the present case the appellant lost the security of employment with the respondent in circumstances where it had sold part of its business but continued with other aspects of that business. The appellant had been headhunted to join the respondent and after more than eight years' continuous employment was entitled to feel a significant degree of security in that employment.
38 In Brent & ors v Bastian (2003) 124 IR 223, a Full Bench considered the approach to be taken to redundancy pay and the role of mitigation in relation to money earned after termination of employment. The decision at first instance was decided before amending legislation introduced the provisions of s 106(6) regarding mitigation, and the Full Bench therefore considered the circumstances in which general principles of mitigation might apply to redundancy. In doing so, note was made of the earlier Full Bench decision in Westfield Holdings v Adams (2001) 114 IR 241 where the Court said that, ordinarily where an employee has been successful in avoiding his or her loss or has failed to take reasonable steps to avoid loss in the period following dismissal, the Court in determining what is just in the circumstances of the case should give consideration to whether and to what extent any money amount in respect of notice of termination that is contemplated to be the subject of an order under s 106(5) should be reduced by monies earned or imputedly earned in the relevant post-termination period. It would not ordinarily be appropriate to reduce redundancy or severance payments when making orders under s 106 because of the efforts or success of the employee in obtaining alternative employment. Importantly in that case the Full Bench confirmed that the principle of mitigation would not normally apply to monies paid on account of redundancy but that the principle was open for consideration in relation to the amount of notice.
39 Her Honour determined the question of whether or not redundancy pay should be made by the respondent by considering what steps had been taken by the respondent to secure continuity of employment for the appellant. Clearly, the respondent had made provision in the sale agreement for its employees to continue employment with another Elders' entity. Because of the appellant's complaint, firstly, that he was deserving of redundancy pay and, secondly, that no such employment had actually been offered to him by Elders, the respondent made enquiries of Elders and there was evidence of Elders' response in July 2001 stating that the appellant would be offered employment with the licence holder of the Elders' operation in Bathurst. That employment was to be on a salary equal to the current level of salary, the salary package was to increase in line with the current value of the vehicle and there was to be continuity of current superannuation. That letter does not appear to have been sent to the appellant.
40 Significantly, on 3 July 2001, Elders wrote to Mr English referring to previous conversations regarding the structure of Elders at Bathurst following the acquisition of the respondent's business and confirming an offer to the appellant to acquire the servicing rights to the Elders' portfolio. Broadly put, that letter proposed that the appellant enter into the general representative's agreement with Elders, that he purchase the servicing rights to both the respondents and the Elders' business at Bathurst at a total cost of approximately $180,000, that there would be loans available from Elders and that the appellant would employ all staff although there would be some subsidies and contribution made on that account. That proposal was rejected by the appellant. However, on 18 September 2001, Elders wrote to the appellant noting that his employment with the respondent would cease at the end of September 2001, and that:
As of this point the staff and you will come under employment through the Elders' agent for the Bathurst region. Your employment will be based on your current terms and conditions. Thank you for your patience through this changeover period and I will be in touch to clarify in the near future. I would appreciate it if you could inform all staff of this offer.
41 The evidence clearly points to arrangements being made by the appellant to secure employment with Elders once it took over the business. There was some evidence that, in the early days after the sale was announced, Elders spoke to the employees concerned and certainly confirmed to the respondent that the appellant had been offered employment, but in circumstances where it was also interested in having the appellant take up the Bathurst franchise. The appellant's evidence seemed to be consistent that, from the very beginning, he informed the respondent that he was redundant and that he had never been offered employment with Elders but had been offered the franchise in Bathurst, a prospect that remained under discussion for many, many months until the negotiations broke down in July 2002. This was the situation from the 7 June 2001 meeting between branch managers and representatives of the respondent and Elders. With the evidence in this state, consideration needs to be given to the effect of the appellant's uncontradicted evidence that he had been informed that the offers of employment were for the staff at the Bathurst office and that the only ultimate offer from Elders was to take up the franchise of that office.
42 Her Honour records that evidence of the appellant and seems to have otherwise accurately stated the evidence brought by the parties. The appellant submits that her Honour rejected this vital and uncontradicted piece of evidence about Elders' position but, on a full reading of the judgment, that does not appear to be the way in which her Honour dealt with that piece of evidence. Her Honour firstly acknowledged that evidence and the fact that it was not cross-examined upon. Her Honour then put it in the context of other evidence as to the arrangements made by the respondent for its employees to continue employment with Elders, Elders' discussions with the appellant, Elders' assurance to the respondent that it had offered either employment or a franchise to the appellant and the appellant's continuing work with Elders while the details of the franchise were being considered. Her Honour then expressed the view that the arrangements were such that they were capable of being misunderstood by the parties and that the vital exchange relied upon by the appellant in his affidavit in reply did not have the implications he read into it.
43 Having reached this position on the evidence, her Honour seemed to be influenced by the fact that, even though it occurred while negotiations were continuing, the appellant took up employment with Elders. This event might provide some evidence that Elders was willing to take the appellant as an employee but that inference is severely reduced because of the fact that this employment took place while they were finalising franchise arrangements: it is understandable that it might have suited both parties to allow those duties to be performed for salary while the ultimate terms of the franchise were being considered - that is the thrust of the appellant's evidence. What stands unknown is, would the employment have continued had the appellant, in July 2002, rather than leaving the Elders' business, simply announced that he intended to continue as Bathurst manager and would not to take up the franchise? This possibility raises additional questions: if the appellant decided to stay with Elders, could he be employed in the same or a comparable position or would the ultimate franchise holder seek to operate the business personally - much like Elders' sought to achieve with the existing branch managers? Would the franchise still be an attractive or financially viable proposition if it contained another layer of employment at a managerial level? There is nothing in the evidence to suggest that Elders considered these matters. One inference available from the appellant's voluntary termination of employment at that point was his understanding that if he was not to take up a franchise then there would be no employment for him: that issue will be considered next. In addition, her Honour seems to have formed the view that, once the employment continued with Elders on whatever basis, the fact of that employment meant that there could be no unfairness in the respondent not paying redundancy pay to the appellant. With respect to her Honour that approach seems to elevate the mere fact of employment to the employment contemplated by the respondent in its sale agreement with Elders. The evidence does not go that far and her Honour was in error in treating that employment as other than covering a temporary situation while the parties worked out what they undoubtedly thought would be the terms of a franchise arrangement.
44 The question therefore remains whether, in fact, the respondent arranged for suitable or comparable employment for the appellant with Elders upon the sale of its business. Certainly, the evidence demonstrates that was the position the respondent attempted to secure by the terms of the sale agreement. The respondent then enquired of Elders whether or not employment had been offered to the appellant because of the appellant's complaints and had received a written assurance that comparable employment had been offered to the appellant. The question is then asked: what more could the respondent do? The appellant's answer is that it could not stand idly by and allow the terms of the sale agreement to be ignored.
45 Her Honour's process of reasoning appears to have been as follows: She found the appellant's employment was unbroken and continued unaltered except as to the identity of the employer and that the appellant in fact accepted and continued in employment as a branch manager as a result of discussions with Elders. Her Honour at one point rejects the proposition that Elders gave the appellant no choice as to future employment or that he was "forced" into franchise negotiations. Having set out those conclusions, her Honour noted that the sale agreement required employment to be offered to the appellant and that the respondent had "repeatedly" been assured that employment was being offered. This was confirmed in writing although there was a reference to employment with a franchisee and her Honour then noted that Elders offered the appellant employment, in correspondence "in ambiguous terms" which might technically be a breach of the sales agreement in that it offered employment with a franchisee and not Elders directly.
46 Her Honour then states that the proposition that the appellant was only offered employment until franchise negotiations were concluded rested on his affidavit in reply: however, that statement was inconsistent with and in direct contradiction of the written offer made to the appellant earlier that day by Elders and was also in breach of the sale agreement. Having recorded the appellant's submission that the Court "must" accept the appellant's evidence as to this matter in circumstances where he was not cross-examined on it, her Honour concluded that the evidence did not reflect the "true force" of what was being put by Elders. Her Honour came to this conclusion because the communications showed "much room for misunderstanding" about what was being put and the real effect of what was being put in ongoing negotiations. The appellant bore the onus of establishing that Elders was not the employer but that the employer was Golf n' Gear Pty Ltd, a service company connected with the Elders' Orange franchise. However, her Honour could not conclude on the evidence that Golf n' Gear Pty Ltd was the employer rather than Elders, nor that the employment had a limited life.
47 Her Honour was correct in rejecting the appellant's assertion that she was bound to accept his evidence in reply, which was not challenged in cross-examination, that ultimately he was not offered employment with Elders but only the chance to take up a franchise. The evidentiary rule in Browne v Dunn (1893) 6 R 67 requires that any matter upon which it is proposed to contradict the evidence given by a witness must normally be put to him so that he may have an opportunity of explaining the contradiction - failure to do so may be held to imply acceptance of the evidence. As pointed out by Samuel JA in Ellis v Wallsend District Hospital (1989) 17 NSWLR 553, the authorities do not establish any rule of law that a judge is bound to accept any evidence which is not challenged in cross-examination. His Honour noted that the rule established in Browne v Dunn, as was pointed out by Hunt J in Allied Pastoral Holdings Pty Ltd v Commissioner of Taxation (1983) 1 NSWLR at 18, had two aspects: firstly, it established a rule of procedural fairness; and, secondly, a rule relating to the weight or cogency of evidence not challenged by cross-examination.
48 In Ellis, Samuels JA also refers to the joint judgment of Hope and Glass JJA in Poricanin v Australian Consolidated Industries Ltd [1979] 2 NSWLR 419, at 426:
A tribunal of fact may, and indeed generally should, have regard, in deciding what its findings of fact should be, to the failure of a party to cross-examine his adversary upon evidence which the adversary has given to satisfy the onus which lies upon him. As Browne v Dunn ... shows, it may be wrong in many cases for a party to suggest that the other party's evidence should not be accepted, if there has been no relevant cross-examination; and, if a tribunal of fact rejects that evidence in those circumstances, the result may be a wrong finding of fact, or, to use other language, unreasonable: cf Precision Plastic Pty Ltd v Demir (1975) 132 CLR 362, or even a perverse finding of fact. However even if, in the circumstances, a tribunal ought to accept evidence upon which there has been no cross-examination, its failure to do so is not a mistake of law.