Walker v Citigroup Global Markets Pty Ltd

Federal Court of Australia|1988-07-08|Before: Rep P, Lockhart J, Kenny J

background facts 3 In order to understand what follows, it is necessary to refer to some contextual facts. Immediately prior to February 1998, Mr Walker was an equity analyst, head of mining research and an executive director at ABN AMRO Australia Hoare Govett (Securities) Ltd. As head of mining research, he was responsible for a team of about 10 people. 4 In Australia, ABN AMRO and ABM AMRO Australia Hoare Govett (Securities) Ltd (together ABN AMRO) operated investment bank activities separately from the activities of the ABN AMRO Bank. ABN AMRO had an Australian board of directors. The managing director was Peter Young, who also chaired the executive committee. Until the purchase of BZW Australia and BZW New Zealand ("BZW"), this committee comprised the managing director, the deputy managing director and six or seven executive directors. It was responsible for the management and policy of ABN AMRO. The investment bank had three divisions (Corporate Finance, Equity Sales and Trading and Research), which were responsible to the executive committee and Mr Young. Mr Walker was responsible to the head of research, where there was such a position; otherwise, he was responsible to Mr Young through the executive committee. 5 On 22 December 1997, ABN AMRO announced to staff that its parent company was purchasing BZW. At the time ABN AMRO's parent company acquired BZW's operations in Australia and New Zealand, BZW was a significantly larger and better established business in Australia than ABN AMRO. ABN AMRO/BZW announced that BZW's chief executive officer, Mr Steve Crane, would become the chief executive officer of the merged business. 6 Shortly after the announcement on 22 December 1997, there was appointed an integration committee, consisting of senior management representatives from ABN AMRO and BZW, to oversee the merger and identify the employees to be offered ongoing employment. The integration committee ultimately reported to the ABN AMRO managing board. The board had final responsibility for decisions arising from the merger, including those relating to ongoing employment, although the evidence of one witness (Alan Hargreaves) was that, by the time a decision reached board level, it was "pretty much a fait accompli". 7 On or about 12 January 1998, the staff of ABN AMRO and BZW received a memorandum, which stated: "We are now writing to set out the principles and procedures agreed for merging the various businesses in Australia and New Zealand, and for integrating them into ABN AMRO's global network. Integration Committee The Integration Committee has been established to set guidelines and oversee the merger and integration of the ABN AMRO and BZW businesses. … The Integration Committee will be supported by divisional subcommittees which will be responsible for planning and implementing the integration process. … The Integration Committee, in conjunction with the global business line representatives, will review and approve the subcommittees' plans before implementation commences. Membership of the relevant subcommittees will be announced shortly. Redundancies ABN AMRO's goal is to create a fully integrated Australasian universal bank through combining the best of ABN AMRO Australia, ABN AMRO Hoare Govett and BZW Australasia. Regrettably, redundancies are likely to occur in product lines and support functions in all three organisations. The personnel needs of the merged business will be determined by the integration subcommittees. Where there are overlaps and consequently redundancies are required, we will attempt to find relocation opportunities within ABN AMRO's global network. There will be no presumption as to which people are most likely to be made redundant - the best people will be selected for positions in the merged business. … In some cases we will consider offering voluntary redundancy. …" 8 On 16 January 1998, Mr Walker countersigned a letter of offer of employment with the first respondent and subsequently returned the offer, as agreed, to Oonagh Lancaster, who was the personnel consultant involved in his hiring. A contract of employment between Walker and the first respondent came into existence. 9 On 6 February 1998, Mr Walker's counterpart at BZW - Philip Lewis - was appointed head of resources (research) in the merged organisation. This was equivalent to the position that Mr Walker held prior to the merger. On 23 February 1998, ABN AMRO/BZW made Walker a redundancy offer, which he accepted. He later received a redundancy payment. 10 On 10 February 1998, the financial press reported that the second respondent had purchased the first respondent's Australian business. On 13 February 1998, the second respondent represented that, after its purchase of the first respondent, it would employ Mr Walker on the same terms and conditions as had been previously agreed with the first respondent. 11 On 20 February 1998, however, the first respondent reneged on its employment contract with Mr Walker. Also on 20 February 1998, the second respondent represented that it was likely that a position would be offered to Mr Walker in its Corporate Finance department. Between 20 February 1998 and 20 March 1998, Mr Walker relied on this representation in seeking employment with the second respondent. 12 After the trial on liability, I found that there was no evidence that Mr Walker's position at ABN AMRO was under threat at any time prior to February 1998. I also found that, some time after he had accepted the first respondent's employment offer, Mr Walker, with the knowledge and support of Mr Fulton, an employee of the first and, later, the second respondent, sought to negotiate a voluntary redundancy from ABN AMRO; and that, by taking steps to leave ABN AMRO, he acted to his disadvantage.

evidence at the trial on damages 13 At the trial on damages, Mr Walker relied on three further affidavits sworn by him on 3 May 2004 ("the third affidavit"), 18 August 2004 ("the fourth affidavit") and 6 September 2004 ("the fifth affidavit"). He also gave oral evidence and was subject to cross-examination. The respondents sought to rely on three affidavits: an affidavit of Peter Quinton affirmed on 4 August 2004; an affidavit of Paul Masi sworn on 6 August 2004; and an affidavit of Alan Hargreaves affirmed on 9 August 2004. Messrs Quinton, Masi and Hargreaves also gave oral evidence and were subject to cross-examination. Nicholas John McAlpine, who was the deputy head of human resources for ABN AMRO Australia, gave evidence on subpoena. He identified the company's redundancy policy, current at least between 30 July 2001 and 27 August 2004.

mr walker's evidence 14 I accept Mr Walker's evidence concerning his academic qualifications and his early career. He holds a Masters degree in geology from the University of Oxford. He began his career as an explorations geologist, but, in 1990, joined an investment bank as a resource executive. In 1991, he became a resource analyst for another organisation and, in 1995, he joined ABN AMRO. With each new position, he gained seniority and greater remuneration. He also became a contributor in his area of expertise to various forms of media. 15 The respondents led evidence that Mr Walker's employment at ABN AMRO was predominantly as a gold analyst. Mr Walker stated, and I accept, that his expertise was not limited to gold. Prior to joining ABN AMRO, he had been a rated analyst in the diversifieds and solid fuels sectors and, at different times, held responsibility for the coverage of diversified resources, coal, aluminium, gold, and diamond equities, and also some commodity analysis. At ABN AMRO, he had at times held responsibility as a resource analyst not only for gold but also for coal, the CRA group, mineral sands and other diversified stocks, as well as for sections of commodity analysis. 16 Mr Walker stated, and I accept, that, at ABN AMRO, he was predominantly employed as an equity analyst, although from the start of his employment with the company he held the title "director". Further, during his employment at ABN AMRO, he also occupied other positions. Towards the end of 1995, he was appointed an "executive director" and joined the company's executive committee. He also held the positions of head of corporate finance - resources (although only temporarily) and, from some time in 1997, head of mining research. In this role, he was responsible for coordinating activities of resource analysts covering a variety of areas. He was a contact point for the ABN AMRO Global Mining Group ("the Group") and manager, co-organiser and, occasionally, chairman of the annual Zurich Gold Conference. He represented ABN AMRO at public and private functions. Mr Walker and Mr Quinton disputed the correct apportionment of Mr Walker's duties but nothing ultimately turns on this factual detail. 17 Mr Walker was the subject of performance reviews in 1996 and 1997, which, I accept, were very favourable to him. Mr Quinton's evidence in cross-examination was that there was no-one better than Walker at ABN AMRO in his area as at 12 December 1997, prior to the merger. It is not suggested that he lost his position at ABN AMRO because of his work performance. 18 Mr Walker's evidence at the trial on liability was that, after he signed the contract with the first respondent on 16 January 1998, he did not actively pursue a position in the merging organisation. He reiterated this evidence at the trial on damages. 19 Mr Walker's evidence was that, when he returned to work at ABN AMRO on 2 February 1998, he did not apply for a position in the merging organisation because of his contract with the first respondent. He did, however, give Mr Quinton a memorandum dated 2 February 1998 in Quinton's office around this date. Amongst other things, the memorandum stated that: "As head of mining research, I am prepared to commence interviewing the BZW mining analysts promptly. The individuals are known to me, as I interviewed three of them for positions in the ABN AMRO mining team in 1997. Some overlap does exist, particularly in the commodity analysis area. An appropriate first course of action would be to collect CV's for all BZW personnel." 20 Mr Quinton's evidence was, and I accept, that he annotated this memorandum at some stage after he received it to the effect that he had been informed by "client/head hunter" that Salomons had offered Mr Walker a position. I discuss this evidence further below. I accept that, as Mr Walker said, Mr Quinton did not discuss the contents of the annotation with him. 21 As noted already, four days later, on 6 February 1998, Lewis was appointed to a position in the merged organisation that was equivalent to Mr Walker's position at ABN AMRO before the merger. The evidence showed that, on 6 February 1998, the very day Lewis was appointed head of resources (research), Walker wrote a memorandum to Quinton (which was copied to Hargreaves) complaining about his "lack of inclusion in the selection process for the new mining team". 22 Mr Walker's evidence was that his future with ABN AMRO was the subject of a brief conversation with Mr Hargreaves in February 1998. This was presumably the conversation of 3 February 1998, referred to in Walker (No 1) at [88]. Mr Walker deposed: "In a brief conversation lasting no longer than three minutes Mr Hargreaves noted that I had not applied for any of the new positions and made it clear that he understood that I was indicating, by taking this step, that I was not intending to stay. This conversation constituted the full formal discussions I had with ABN AMRO concerning my future role at the firm. … My short discussion with Mr Hargreaves was confined to the role of Gold Analyst and not with my position as Head of Mining Research or my position as Executive Director." 23 I accept Mr Walker's evidence about this conversation, which was not contradicted by Mr Hargreaves, who had no recollection of it. Mr Hargeaves' lack of recollection was unsurprising - given the passage of time; that he was speaking to many people during this period; and that he did not know Walker well. 24 On 13 February 1998, the second respondent's representative told Mr Walker that he would be employed after the sale on the same terms and conditions as had been previously agreed with the first respondent. On 16 February 1998, on Walker's instructions, his solicitors wrote to ABN AMRO alleging constructive dismissal. At the same time, Walker actively pursued voluntary redundancy. 25 The first respondent reneged on Mr Walker's employment contract with it on 20 February 1998. On 23 February 1998, as already noted, Walker accepted ABN AMRO's voluntary redundancy offer. He claimed that, if he had been told that his employment with the first respondent was at risk, he would not have sought redundancy and would have retained his employment with ABN AMRO. 26 Mr Walker gave evidence that he had sound professional relationships with the senior management of ABN AMRO, including the incoming chairman of the ABN AMRO Board, Mr Rowley, and the managing director, Mr Young. Mr Walker's evidence was that, at that time, he would have been willing to work for ABN AMRO in any country in which it operated, save for South Africa, but that he had no discussions with anyone about his capacity to perform other roles in the merged organisation in or out of Australia. I accept Mr Walker's evidence in this regard. 27 Walker rejected Quinton's assertion (referred to below) that Lewis' standing as a commodities analyst in the Australian market ensured the success of his candidacy. Mr Walker drew attention to the fact that Mr Quinton was new to ABN AMRO in 1997 and, according to Walker, did not generally participate in the corporate activities of the executive committee and its two main subcommittees. Walker said that, prior to reading Quinton's affidavit, he was not aware that Quinton was involved in the preparation of a staffing template for the integration committee, and that Quinton had not consulted him about his role or the other resource analysts under him. Mr Walker also rejected Mr Hargreaves' claim that there was no possibility of him continuing in the merged research department. Walker maintained that his expertise was broader than Hargreaves, Masi and Quinton appreciated. I return to these matters below. 28 Mr Walker gave evidence that his private life suffered as a result of his loss of employment, which he claimed led to the breakdown of his marriage in 1999 and a loss of contact with his two children. 29 Again, I accept Mr Walker's testimony concerning his efforts to find employment after 23 February 1998. His evidence was that, from March 1998 until 2000, he regularly scanned the employment advertisements in the two newspapers in which positions at his level in his industry were advertised. He applied for any suitable position that came to his notice. From March 1998 until late 1999, he contacted prospective employers and recruitment agencies. From 19 May 1998, he registered and maintained contact with three financial recruitment specialists and two industry recruitment firms. He also made direct approaches to several resource companies and several financial groups. His evidence was that he had found it extremely difficult to get work through these sources. 30 From May 1998, Mr Walker sought consulting work through his private company, Dalkeith Resources Pty Ltd ("Dalkeith"), a company that he and his wife had established in 1993 for investment purposes. They have been Dalkeith's only directors and shareholders. From this date, Mr Walker, through Dalkeith, sought mandates in various areas including corporate advisory, equity capital raising, research and asset sales. 31 Mr Walker's evidence was, and I accept, that he worked from home, seeking to locate business opportunities. In 2000, Mr Walker and two other individuals established a business known as Auzeq Securities Limited ("Auzeq"). Dalkeith held his interest in the business and received income on his behalf. Auzeq, which was a licensed trader, effectively operated as a "boutique" resource broker. Mr Walker withdrew from Auzeq in early 2002 and worked again through Dalkeith, this time more successfully than in 1999 and 2000. 32 Mr Walker's evidence of his financial position after February 1998 was at times confused. In particular, his evidence in respect of the 2002/2003 and 2003/2004 financial years was not as immediately forthcoming as it ought to have been, although I am satisfied that Mr Walker ultimately made proper disclosure of his affairs to the court. 33 Mr Walker's evidence was that he received no income between February and June 1998. By way of income, he received $10,000 (gross) in the year ended 30 June 1999; $10,355 (gross) in the year ended 30 June 2000; $18,816 (gross) in the year ended 30 June 2001; $15,975 (gross) in the year ended 30 June 2002; $22,194 (gross provisional) in the year ended 30 June 2003; and $34,000 (gross provisional) in the year ended 30 June 2004. In cross-examination, it emerged that the figures for the years ended 30 June 2001 and 2002 were probably in error by about $1500, when regard was had to Dalkeith's books of account. The figures for the 2000/2001 and 2001/2002 financial years included amounts received as interest on money lent to Dalkeith, namely, $12,981 in 2000/2001 and $10,000 in 2001/2002. In the financial years ended 30 June 2003 and 30 June 2004, Dalkeith made superannuation contributions to Walker of $15,000 and $16,000 respectively. There was also evidence of voluntary superannuation contributions, namely $30,000 in 2002, $300 in 2001 and $2,000 in 2000. These latter contributions were made from Mr Walker's personal savings. 34 In his third affidavit, Mr Walker's evidence was that, in the financial years ended 30 June 1998 to 30 June 2002, Dalkeith had accumulated losses of $124,216; that he and his wife invested $108,632 in the company in order to ensure that it remained solvent; and that they received a total of $65,000 by way of directors' fees. In cross-examination, it became apparent that this information and the statements that accompanied it were incomplete. 35 In cross-examination, it emerged that, in some instances, in the 2002/2003 and 2003/2004 financial years, Dalkeith was paid in shares and share options for its work as an investment banker. In his fourth affidavit, Mr Walker gave some details of the issue to Dalkeith of options in the 2002/2003 and 2003/2004 financial years. His evidence showed that, between 28 October 2002 and 15 April 2004, Dalkeith received options over listed and unlisted ordinary shares in various mining companies. Those issued in the 2002/2003 financial year had a total value at issue of $38,800, whilst those issued in the 2003/2004 financial year had a total value at issue of $85,103.35. Other shares and options purchased by Dalkeith during these years were purchased as part of Dalkeith's investment banking activities. 36 Mr Walker was cross-examined on the accounts of Dalkeith for the year ended 30 June 2002, which showed an interest expense for that year of $21,490 in respect a loan from him and his wife. In that year, the company paid $20,000 to the shareholders, divided equally between Walker and his wife. In that year too, loans from shareholders stood at $193,673.50. He was also cross-examined on Dalkeith's accounts for the years ended 30 June 1999, 30 June 2000 and 30 June 2001. In the year ended 30 June 1999, the loans from shareholders were $128,559.31. By 30 June 2000, the shareholders' loans were standing at $143,592.80. In the year ended 30 June 2001, the loans from shareholders were $143,673.50, and interest charged or paid for that year was shown as $27,232. Mr Walker's income included an amount representing a little less than half that sum. In these years, there was no item for accumulated interest. This was, broadly speaking, consistent with the evidence in his third affidavit as to the investment that he and his wife had made in the company. 37 Dalkeith's fortunes distinctly improved from the 2002/2003 financial year. In the financial year 2002/2003, Dalkeith had a total income of $443,093 (including fees of $402,919 and securities of $38,800). Total costs were $250,560, including operating costs of $234,614. Operating costs included interest owed by Dalkeith to Mr Walker and his wife, rent, costs associated with two motor vehicles, directors' salaries, travel and accommodation, and promotional activities. The company's net income was $189,811. There was also a tax loss of $49,808. There were net investments of $383,507, being investments made by the company during the year, and the company made a trading loss of $1,544. About $283,507 in share investments was funded out of the company's earnings. Dalkeith also borrowed $100,000 from Walker and his wife during the year. Interest at a rate of 10% was payable on the borrowing. The balance sheet as at 30 June 2003 showed an item for accumulated interest. This item did not appear in previous years because, according to Walker, the company had no prospect of repaying it. The company's superannuation fund showed fund assets of $73,455. 38 In the financial year 2003/2004, Dalkeith had a total income of $967,349 (including fees of $801,837, securities of $85,103 and share trading revenue of $79,960). Total costs were $151,185 (including operating costs of $131,545). Its net income was $670,564. There was also a tax liability of $166,631. The balance sheet showed cash and receivables of $310,553 and interest received as $450. Interest payable was $84,298. In this year the company repaid $100,000 to Walker and his wife. The company made net investments of $449,533 in the year. It held investments of a book value of $646,807 and total assets of $1,054,313. The company's superannuation fund showed fund assets of $202,768. 39 Mr Walker denied that Dalkeith failed to repay interest to him and his wife in order to reduce his income for the purposes of the assessment of damages. He maintained that Dalkeith needed the funds to pursue its business as an investment banker. He also said Dalkeith had made positive decisions to invest in "growth" shares, rather than seek a dividend income stream, and in stocks, rather than interest bearing cash management accounts. Mr Walker denied that Dalkeith could have paid him a substantially higher salary than $50,000. In cross-examination, Mr Walker said: "The way we do transactions is that we bring our capital to bear, we invest our capital alongside others, we often bridge the gap in an offering or something where they can't complete the capital raising. As I've said … those investments end up with us earning revenue from those clients. We make the transactions go forward." His evidence was that most of the company's investments were parts of placements or, as in one case, the underwriting of an option issue. Mr Walker denied that the company had adopted a strategy that yielded a low figure by way of remuneration to him. He said that he adopted a strategy that generated revenue for the company. I accept this evidence because it accords with the purposes and activities of Dalkeith. Further, although counsel for the respondents also cross-examined Mr Walker about the role of his wife in Dalkeith, I do not consider that anything ultimately turns on this cross-examination. 40 Walker made no claim for loss in the 2004/2005 financial year. In evidence in chief, Mr Walker said that, as at 26 August 2004, Dalkeith "was earning well". Pursuant to heads of agreement agreed in May 2004, in the 2004/2005 financial year, Walker was appointed managing director of a company that was to pay him a substantial income and other benefits. He said that, "with the proceedings of the trial and the judgment, it took off rather quickly around those events, and has continued to do so". I note, however, that some of the pecuniary benefits to be received in the 2004/2005 financial year ought to have been received in the previous year, although there was no evidence that Mr Walker was responsible for the delayed receipt. In his fourth affidavit, Mr Walker stated that, in the 2004/2005 financial year, Dalkeith was to receive further options and shares as part of certain fee arrangements. In cross-examination, he conceded that at least some of these options ought to have issued prior to 30 June 2004. 41 Mr Walker attributed much of his difficulty in finding employment after February 1998 to the effect on his reputation of the respondents' failure to employ him. In Walker (No 1), I referred to Mr Walker's evidence that Ms Lancaster telephoned him on 26 February 1998, to say that she had heard "derogatory comments about him in the market concerning [his] ability and standing". According to Mr Walker, she told him that his name was "now mud" in the industry. Ms Lancaster deposed that she recollected this conversation and the general substance of it. Mr Walker sought to give further evidence that his reputation in the market had been adversely affected by the second respondent's misleading and deceptive conduct. Not a great deal of this evidence was admitted and, in any case, it was not especially cogent. At the trial on damages, Walker called no other witness who might have corroborated his claimed damage to reputation.

mr hargreaves' evidence 42 In addition to an overarching objection taken to the evidence of Messrs Hargreaves, Masi and Quinton, which is discussed below, Mr Walker objected to specific parts of their affidavits. The number of these objections so increased during the trial that, in order to ensure that the trial concluded within the estimated period, I deferred ruling on them. I would sustain two objections to Mr Hargeaves' affidavit, namely, objections taken to paragraph 11, sixth sentence and the whole of paragraph 14, substantially for the reasons advanced by counsel for Mr Walker, and because the opinions expressed in these paragraphs are very largely speculative, given that Mr Hargreaves knew nothing of Walker and Walker took no steps to advance his case to him, believing he already had a position. 43 Mr Hargreaves was managing director of ABN AMRO Australia Hoare Govett (Securities) Limited from some time in 1997 until February 1998. He arrived in Australia in December 1997 shortly before the announcement on 22 December 1997 of ABN AMRO's acquisition of BZW. In February 1998, he was appointed head of research for ABN AMRO following its acquisition of BZW. 44 Mr Hargreaves' evidence was that, in late 1997, Paul Masi requested him to provide assistance in preparing recommendations to the integration committee. These recommendations were to identify the employees to be offered employment in the merged business and those to be made redundant. At this time, according to Mr Hargreaves, he had not worked closely with the analysts in ABN AMRO's research department, and he had never met or otherwise dealt with Mr Walker. Against this background, Mr Hargreaves asked Mr Quinton, then ABN AMRO's head of research, to provide advice regarding the structure of the merged research department. 45 In response to Mr Hargreaves' request, Mr Quinton prepared a written memorandum dated 9 January 1998. Amongst other things, the memorandum stated, "[t]he combined number of analysts currently at ABN-BZW is very close to the 'ideal'". In a table accompanying the memorandum, Mr Quinton also commented that there were "far too many gold analysts". Mr Hargreaves discussed the memorandum with Mr Quinton and, in particular, sought Mr Quinton's views as to which ABN AMRO employees should be offered employment in the merged organisation. Mr Hargreaves did not recall Mr Quinton recommending that any of the analysts in the resources division, which included Mr Walker, should be kept on. 46 Mr Hargreaves' evidence was that he supported Mr Lewis's appointment as head of resources in the merged department, and that he and Mr Masi made the decision to appoint him to this position. As already noted, Lewis was Walker's counterpart at BZW. Mr Hargreaves said that he did not consider anybody other than Lewis to be a candidate and that he did not consider Walker for the position. Mr Hargreaves said that he held the BZW team of resource analysts in high regard and believed that it was important to retain as many of that team as possible. He said that he recommended to Mr Masi that the merged entity should not retain any of the incumbent ABN AMRO resource analysts. The merged research department did not contain a full-time gold analyst position that might have been suitable for Mr Walker. 47 In cross-examination, Mr Hargreaves said that at the time ABN AMRO "were looking to place whoever we could but I don't remember there being many opportunities". He acknowledged that ABN AMRO policy was that the best people would be selected for positions in the merged business, whether they came from ABN AMRO or BZW. 48 Also in cross-examination, Mr Hargreaves said that, prior to December 1997, he had never worked with Walker and knew nothing of his work capacities. By the end of December 1997, he still did not know Mr Walker particularly well. Mr Hargreaves had no recollection of any discussion with Mr Walker in late 1997 or early 1998. Nor did he recall reading any of his performance reviews. He said, in cross-examination, that, in January 1998, he thought he was starting to form a view about his capabilities. He said: "During this process there were endless conversations with people about the quality of skills or otherwise of different people involved. I had to obviously rely on people who had known everyone for longer periods, had worked with them more closely." "It's two major organisations trying to come together with a lot of lives involved, so it's a very complex and exceptional circumstance." 49 Mr Hargeaves went on to say in cross-examination that, in the course of his discussions with Mr Quinton, Quinton noted Walker's strengths but "at no time did he become supportive of Walker joining the merged team". He said that Quinton had told him that Walker was "a very skilled analyst". Mr Hargreaves recalled hearing at some stage that Mr Walker had got a job elsewhere, but he could not recall when he heard this information. 50 Mr Hargreaves was, so it seemed to me, a scrupulously honest witness, although he acknowledged in cross-examination, that his memory of the relevant events had dimmed in the ensuing years. The effect of the passage of time on his memory must be borne in mind in assessing the significance of any relevant differences between his and Mr Walker's evidence. That is, for the reasons already stated, I accept that Mr Hargreaves had a conversation with Mr Walker in February 1998 to the effect described by Mr Walker. I accept Mr Hargreaves' evidence, although, in determining its significance for this case, it must steadily be borne in mind that, on his own account, Mr Hargreaves knew very little about Mr Walker and was very largely reliant on Mr Quinton for any information about him.

mr masi's evidence 51 Substantially for the reasons advanced by counsel for Mr Walker and because the opinions expressed in the relevant paragraphs are speculative, I would sustain four of the objections to Mr Masi's affidavit, namely, objections taken to the third and last sentences of paragraph 11, the second sentence of paragraph 15 and the third sentence of paragraph 18. 52 Mr Masi was employed by BZW Australia. He did not work for ABN AMRO at any time prior to February 1998. Between 1996 and February 1998, he was BZW's head of equities, reporting to Mr Crane. In 1997, Mr Lewis, who was BZW's head of resources, reported to him. Mr Masi was appointed head of equities in the merged ABN AMRO business in early 1998. 53 Mr Masi's evidence was that the integration committee directed him to prepare a report setting out recommendations identifying the employees in the equities division (including the research department) who were to be retained in the merged business. He asked Hargreaves, Lewis and Peter Hooker (then head of industrials in the research department of BZW Australia) to provide their recommendations concerning the ABN AMRO/BZW staff to him. He stated that, based on his discussions with Hargreaves, he was of the view that there would be redundancies arising out of the merger because of overlapping responsibilities. 54 In his affidavit, Mr Masi said that "[t]here was never any doubt in my mind that Mr Lewis would continue as an employee in the merged department"; and that he strongly supported retaining him as head of resources. He stated that the decision to appoint Mr Lewis was taken by him and Mr Hargreaves. He further deposed: "There were no interviews conducted for the position of Head of Resources and no other persons were considered for this position other than Mr Lewis." Mr Masi said that he did not know Mr Walker personally or by reputation prior to January 1998 and that he gave no consideration to appointing him. 55 Mr Masi's ultimate report to the integration committee was dated 12 February 1998 and included the recommendation that Mr Walker "not be integrated" into the merged business. The integration committee accepted his recommendations. His evidence was that, so far as he was concerned, the incumbent BZW analysts were in a better position than their ABN AMRO counterparts for a number of reasons, including that he considered the BZW analysts "more established in attracting business from leading financial institutions" and he had "first hand knowledge" of each of them. 56 In his affidavit, Mr Masi noted that there was no full-time gold analyst position in the merged business. He also said that, prior to making his report to the integration committee, he had no knowledge that Mr Walker had been offered another job. 57 In cross-examination, Mr Masi said that he could not recall ever meeting Mr Walker and, in the period between December 1997 and February 1998, he knew nothing about him or his capabilities. Also in cross-examination, he said that he did not appreciate that Mr Walker was head of mining research until he read Mr Walker's affidavit in this proceedings. He could not recall Mr Walker being promoted to him in this capacity. He agreed with Mr Walker's counsel that "it didn't even enter [his] thought processes that anyone other than Mr Lewis would be the head of resources in the merged department" and added that no-one from ABN AMRO informed him that there was another choice. 58 Mr Masi stated in cross-examination that he knew that Mr Quinton was head of research but he did not know whether he "scratched beyond that". He did not recall speaking with Mr Quinton during this period. He recalled speaking about his recommendations with Mr Young and Roger Sharp, both of whom were on the executive committee. He also said that he spoke "in a general sense to Mr Hargreaves and to [his] two heads of research at that stage, … to clients … to try to ascertain the status of [the ABN AMRO] team". 59 According to Mr Masi, he met Mr Hargreaves in December 1997, a couple of weeks before the announcement of the merger, "to understand the organisation, the firm, and to understand the senior people that they rated and wanted to go forward". He did not recall the content of his conversations with Young or Hargreaves. Mr Masi's evidence was that he relied on Hargreaves because he was going to be running the research department. In cross-examination, he said: "So it was very much Alan [Hargreaves]'s team and Peter [Hooker] and Phillip [Lewis] had been given those responsibilities in conjunction with Alan to select what they perceived was the best team." 60 Also in cross-examination, Mr Masi said that he received no instructions to find opportunities for people who might otherwise be made redundant. He did say, however, that: "As head of equities, my responsibility was obviously to … try to keep the best people in the business, and if there was somebody that I felt should stay in the business or wanted an opportunity, I'm sure they could come through me and I could put them through the integration committee for that opportunity." Mr Masi added that, at that stage, he had very little knowledge of the ABN AMRO global network and it was very difficult for him "to sort of put people in that position". 61 Masi maintained that he tried to "produce the best people for the business" as he understood the criteria. He said that: "[M]y general understanding, as the head of equities, was to produce the best business in terms of … the best combination of skills and talents that produce returns, best services, service clients best and gets the best rates of return for the business. I genuinely tried to do that. There's no doubt we all have biases and understandings. You come in and we have team structures in this business … . In my situation, when you're trying to merge businesses where there's obviously a limited amount of information, you certainly ask some people to prepare for you … what they perceive the best rankings, the best balance, the best working relationships are of the business. I mean, I don't doubt that there were natural biases in your selections because there are people you work with. You work very closely with them and you've seen them perform in … difficult situations. I think … the ABN people were slightly disadvantaged in the sense it was a newer business, it was a less developed business. Their global parent had purchased BZW for a lot of money. They wanted to see that business intact and go forward, to a large degree, and we tried to merge together the best components we could of those businesses without losing … the value that was already existent in the business by sort of pulling apart the teams. So within that context I certainly tried to produce the best combination of people possible." 62 In cross-examination, Mr Masi agreed that his memory of the events which his evidence concerned was not perfect but he added that he had "lots of memories of those events because it was quite a tumultuous time" and his affidavit tried to address "the specific things I do recall". I accept that Mr Masi was an honest witness and gave an honest account of his own perception of events. The effect on his memory of the passage of time, his reliance on Mr Hargreaves (as well as Messrs Lewis and Hooker of BZW) and his lack of knowledge of Mr Walker must also be borne in mind in assessing the significance of his evidence for this case.

mr quinton's evidence 63 I would not sustain the objections taken by Mr Walker to specific paragraphs or parts of paragraphs in Mr Quinton's affidavit. 64 Immediately prior to February 1998, Mr Quinton was director - head of research at ABN AMRO. Mr Walker reported to him. In February 1998, he became director - chief investment strategist in the merged business. 65 Mr Quinton's evidence was that he learnt about the acquisition by ABN AMRO of BZW in late 1997. At that time, he was a member of the executive committee, although not on the board. Mr Quinton said in cross-examination that BZW was "without question" a substantially larger entity than ABN AMRO, although ABN AMRO was part of a global network of companies. He said that, in late December 1998, Mr Hargreaves asked him to prepare a template for the staffing of the research department after the merger. He prepared such a template in the first week of January 1998, and gave it and an accompanying memorandum to Mr Hargeaves on 9 January 1998. 66 In preparing the template, Mr Quinton ascertained the existing staffing arrangements for BZW, as well as ABN AMRO. He said in cross-examination that the memorandum, which he prepared at the end of January 1998, was an attempt to put forward ideal staffing numbers and not to identify the individuals who would fill the positions. At that time, Mr Walker was one of two gold analysts in ABN AMRO's resource department. BZW also had two gold analysts. In cross-examination, Mr Quinton agreed that the gold analysts at BZW were not as well regarded as Mr Walker. Mr Quinton's evidence was that he did not believe that there was any justification for the retention of all four gold analyst positions in the merged business, and thus he recommended that the number be reduced to two. I interpolate here that the merged department ultimately had only half of a full-time gold analyst's position. 67 Mr Quinton's evidence was that he subsequently discussed the individual analysts with Mr Hargreaves, and made working notes for this purpose. These notes show that he put a question mark above Mr Walker's name and a line through the other ABN AMRO gold analyst. He stated that he put the question mark above Mr Walker's name because, based on his recommendation that there be only two gold analysts, either Mr Walker or one of the BZW analysts had to go. Mr Quinton also said: "Further, … the Research Template which I had prepared assumed that the position of Head of Resources would have industry sector responsibilities, and I had therefore included this position in the analyst numbers. I was aware that Mr Phil Lewis was Mr Walker's counterpart at BZW as Head of Resources. In addition, I knew that Mr Lewis was BZW's Commodities Analyst and that ABN AMRO did not have a position in Australia. I had recommended to Mr Hargreaves that there be a Commodities Analyst in the merged Research Department. If this recommendation was accepted, Mr Lewis was almost certain to be offered employment in the merged Research Department." Mr Quinton said that, in his discussions with Mr Hargreaves in mid-January, he raised doubts about Mr Walker being offered on-going employment, because he considered that Mr Lewis was likely to be preferred over him for the position of head of resources and he did not consider it practical for Mr Walker to continue to work as a gold analyst reporting to Mr Lewis. In cross-examination, he said that he crossed out names or put question marks over them, as an expression of a preliminary view as to who should be retained in the merged organisation and who might not. He added that, after he had discussed his report with Hargreaves, he was "out of the loop". He said that he had never seen the document prepared by Mr Masi, which was confidential to the integration committee. 68 Mr Quinton's evidence in cross-examination was that, by January 1998, he had worked closely with Mr Walker for some time, and he agreed that, as head of mining research, Walker needed to be and was across all the specialties of his subordinates, at least to some extent. Mr Quinton also said that Mr Walker's "skill base extends beyond gold, but his employment at ABN was predominantly … gold based". He added that, prior to the merger, he did not know the other analysts at BZW from his own experience. 69 Mr Quinton said that he received Mr Walker's memorandum, which was dated 2 February 1998, regarding the selection process on or about 2 February 1998. He wrote on the top of this document: "AH - will involve people as appropriate Report from client/headhunter, you have gone to Salomon" In his affidavit he said that this note indicated that: (1) there would not be a formal interview process, but Alan Hargreaves would have informal discussions with people as appropriate; and (2) he had been informed by a client/headhunter that Mr Walker had a job offer from Salomon Smith Barney (i.e., the second respondent). Also in his affidavit, Mr Quinton said that he could not recall who had told him this. He said that he was not aware that Mr Walker had such a job offer "when he suggested to Alan Hargreaves that Mr Walker not be offered ongoing employment". This was, of course, before Walker had entered into any contract with the first respondent. 70 In cross-examination, Mr Quinton said that he might have made the notes on the 2 February 1998 memorandum as a reminder to himself, as distinct from making a note to mention the subject to Mr Walker. The reference was definitely to Walker going to the second respondent. He added that his annotations were: "partly as a prompt to me and obviously also partly as a prompt to tell somebody something". According to Mr Quinton, this prompt would either have been to speak to Mr Walker himself or to inform Mr Hargreaves. He said that his "first port of call" would have been Hargreaves, adding that: "I can't imagine I would retain information like that to myself, and not tell my immediate superior." 71 Also in cross-examination, Mr Quinton said that he could not recall when he annotated the memorandum, and that it might have been after 2 February 1998. Mr Quinton said that "client/headhunter" referred to two people. He also said: "If he heard someone had a job elsewhere he would not have pressed their case to be retained." 72 Mr Quinton was an honest witness, who gave a truthful account of the relevant events as he perceived them to be. It needs to be borne in mind, however, that Mr Quinton conceded that, as one might indeed expect, his memory of the relevant events was dimmer at trial than it was at the time; and that his task in preparing the template for ideal staffing numbers was a limited one.

Admissibility of the evidence of Hargreaves, Masi and Quinton 73 At the commencement of the trial on damages, counsel for Mr Walker made an overarching objection to the admissibility of the affidavits of Messrs Hargreaves, Masi and Quinton. In relation to these three affidavits, Mr Walker submitted that they were directed to establishing that "the Applicant's employment with ABN AMRO was under some sort of threat prior to February 1998" and this was contrary to "an express finding of fact made and relevant to … the judgment on liability". Objection was taken to the affidavits on the grounds that: "It is an abuse of process to seek to reagitate or to controvert a finding of fact made by a court of competent jurisdiction (Hunter v Chief Constable of West Midlands [1982] AC 529 at 541-2, and Williams v Spautz (1992) 107 ALR 635, 643 and 648-9), and the evidence should not be admitted." 74 Because the effect of this affidavit evidence would not become clear until the end of the trial and it was integral to the respondents' case, I admitted these affidavits subject to Mr Walker's objection. The cross-examination of the deponents proceeded also subject to this objection. 75 Counsel for Mr Walker submitted that damage was an essential element of a cause of action under the TPA and that the whole of the evidence of these witnesses was inadmissible as an attempt to controvert the findings of fact on liability, "if tendered to show … that the Applicant's claim under the [TPA] should be dismissed" and "if tendered to show that there were causes of the Applicant losing his job in addition to the Second Respondent's misleading and deceptive conduct, then it [was] irrelevant in law". In this regard, he cited I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2002) 210 CLR 109 ("I & L Securities"). Counsel for Mr Walker submitted that a judgment for damages was a final order and the causes of action merged in the judgment. He also submitted that the respondents might have led this evidence at the trial on liability, because the evidence would have been relevant to the issue of detriment. That is, they sought to raise a matter which could have been, but was not raised as a defence at trial. The only relevant question was not whether, but how much, damages the respondent should pay. 76 Referring to Blair v Curran (1939) 62 CLR 464 ("Blair v Curran") and Miller v University of New South Wales (2003) 132 FCR 147, the respondents submitted that they were not estopped from leading this evidence. They contended that Mr Walker's claim for damages for breach of the fourth representation (Walker (No 1) at [205]-[211]) was premised on Mr Walker's assertion that, had he been told on 13 February 1998 that his employment with the first respondent would not proceed, he would have retained his on-going employment with ABN AMRO. According to the respondents, this premise was based on Mr Walker's self-assessment of his prospects of on-going employment with ABN AMRO. The respondents contended that they sought to rely on the evidence of Hargreaves, Masi and Quinton as a direct response to this assertion. They contended that this evidence provided "a sound evidentiary foundation for the court to make findings of fact regarding Walker's prospects of employment with ABN AMRO on 13 February 1998". The respondents further submitted that, having regard to O'Neill v Medical Benefits Fund of Australia Ltd (2002) 122 FCR 455 ("O'Neill"), if the court rejected the respondents' primary submission that the detriment suffered by Mr Walker did not translate into compensable loss, then it was necessary for the court to assess the period Walker was likely to remain in employment with ABN AMRO, being a question that arose only on the trial of the assessment of damages. It was not, so the respondents said, open to the court to turn a blind eye to the evidence of Messrs Hargreaves, Masi and Quinton. 77 Counsel for the respondents submitted that a finding as to detriment was not a constituent element of a cause of action under s 52 of the TPA. Counsel said, "[o]ur case is that under section 52 our opponents have to make out a representation made in trade and commerce, that the representation is misleading or deceptive and that their client relied on that misrepresentation". He added, "[w]hat comes afterwards is a case under section 82, and that is where we are now embarking". Counsel's alternative position was that, even if Mr Walker had forgone opportunities between 13 and 23 February 1998, the detriment did not translate into loss and damage of the kind being claimed by Mr Walker. 78 To evaluate these contentions, it is necessary to refer to certain findings made following the trial on liability. In particular, there were findings that: (a) After the announcement of the purchase of the first respondent by the second respondent, in a telephone conversation on 13 February 1998, Mr Fulton, on behalf of the second respondent, represented to Mr Walker that he would be employed after the sale on the same terms and conditions as had been previously agreed with the first respondent: see Walker (No 1) at [205]. (b) As Mr Walker's employment was to begin in March 1998, Mr Fulton's representation about it was as to a future matter. The second respondent had not established that it had reasonable grounds for this representation and, by virtue of s 51A of the TPA, the representation is taken to be misleading and deceptive: see Walker (No 1) at [210]. (c) Mr Walker relied on the representation in pursuing (or continuing to pursue) a redundancy package with ABN AMRO and in taking other steps, through his solicitors, to leave his former employer as speedily as he could. In so doing, he acted to his detriment: see Walker (No 1) at [211]. Upon the above matters, I held that Mr Walker made out a cause of action under s 52 of the TPA against the second respondent in connection with the fourth representation: see Walker (No 1) at [211]. This formed a basis of my order that judgment be entered for the applicant for damages to be assessed. 79 In addition, in the course of my reasons for judgment, I rejected the respondents' submission that Mr Walker entered into an arrangement pursuant to which he would initiate steps to leave ABN AMRO but would not accept an offer of employment before he left his former employee, as inconsistent with the facts and implausible. In this context, I also found that there was no evidence that Mr Walker's position at ABN AMRO was under threat at any time prior to February 1998: see Walker (No 1) at [160]. Also, as part of the narrative of the events, I also found that Mr Fulton knew by early February 1998 that Mr Walker's prospects of continuing employment with ABN AMRO had been significantly prejudiced by his request for a redundancy package and by the rumours in the market place that he was to join the first respondent: see Walker (No 1) at [94]. 80 It is well accepted that loss or damage is the gist of the statutory cause of action for which s 82(1) of the TPA provides: see Wardley v Australia Ltd v Western Australia (1992) 175 CLR 514 ("Wardley") at 525 per Mason CJ, Dawson, Gaudron and McHugh JJ; Sellars v Adelaide Petroleum NL (1994) 179 CLR 332 ("Sellars") at 348 per Mason CJ, Dawson, Gaudron and Toohey JJ; and O'Neill at 465 [27]. The position is not relevantly different in this case, although damages are sought under s 87 of the TPA: compare Demagogue Pty Ltd v Ramensky (1992) 39 FCR 31 ("Demagogue") at 33 per Black CJ, 43 per Gummow J and 47 per Cooper J and I & L Securities at 125-7 per Gaudron, Gummow and Hayne JJ. The cause of action arises when a person suffers loss or damage "by" the contravening conduct of another person: compare ss 82(1) and 87(1). 81 This case is concerned with a contravention of s 52(1) of the TPA. As the majority said in Wardley at 525-6: "In this situation, as at common law, acts done by the representee in reliance upon the misrepresentation constitute a sufficient connexion to satisfy the concept of causation. And, if those acts result in economic loss, that is, loss other than physical injury to person or property, that economic loss will ordinarily be recoverable under s 82(1). … The measure of damages recoverable under s 82(1) can only be ascertained after a thorough analysis of those provisions in Pts IV and V of the Act for contravention of which the statutory cause of action may be maintained. But the common law measure of damages will in many cases be an appropriate guide, though it will always be necessary to look to the provisions of the Act with a view to ascertaining the existence of any relevant legislative intention. In such a case as the present, it may safely be assumed that the plaintiff is entitled to recover "a sum representing the prejudice or disadvantage [the plaintiff] has suffered in consequence of his altering his position under the inducement" of the misleading conduct or "the actual damage directly flowing from" that conduct, to take up and adapt well-known statements of the measure of damage applicable in an action of deceit." In this case, although under s 87, these observations are apposite. 82 A judgment for a plaintiff against a defendant for damages to be assessed determines the liability of the defendant to pay damages to the plaintiff, leaving only the quantum of those damages to be assessed: see National Australia Bank Ltd v Maher (No 2) [1999] 3 VR 583 ("NAB") at 592 per Callaway JA, with whom Winneke P and Batt JA agreed. At least where damages are not the gist of the action, a judgment such as this is sometimes said to be final as to liability but interlocutory as to quantum: see NAB at 593. There is also authority for the proposition that, where damages are the gist of the action, then an order for judgment with damages to be assessed is interlocutory: see, eg, Electricity Commission of NSW v Lapthorne (1971) 124 CLR 177 at 185 per Barwick CJ; Burns v Lipman (1975) 132 CLR 157 at 159 per Barwick CJ, Stephen, Mason and Jacobs JJ; and NAB at 596-8 and the authorities cited therein. Even if this analysis applies to the present case, as it would seem it does, it is nonetheless accurate to say that the judgment implies a finding of sufficient damage to sustain liability although the quantum of such damages is yet to be assessed. 83 This last proposition accords with my finding, in Walker (No 1), that, in pursuing (or continuing to pursue) a redundancy package with ABN AMRO and in taking other steps, through his solicitors, to leave his former employer as speedily as he could, Mr Walker acted to his detriment. The detriment (or loss and damage) suffered by Mr Walker was the loss of the opportunity to enlist the support of his superiors and others in finding a position within the ABN AMRO global organisation that he might fill. This opportunity was lost when Mr Walker, acting on Mr Fulton's representation of 13 February 1998, pursued a redundancy package with ABN AMRO, instructed his solicitors to send a letter on 16 February 1998 alleging his constructive dismissal, and failed to take steps to secure a position in the merged organisation. In the terms of Dixon J in Blair v Curran at 532, a finding that there was sufficient damage to sustain liability was legally indispensable to the holding that the applicant had established the cause of action he pleaded in respect of the fourth representation. 84 The decision of the majority of the High Court in Sellars at 348-50makes it plain that loss of opportunity to obtain a commercial advantage or benefit can amount to "loss or damage" within s 82(1). The majority said, at 355: "Notwithstanding the observations of this Court in Norwest [Refrigeration Services Pty Ltd v Bain Dawes (WA) Pty Ltd (1984) 157 CLR 149], we consider that acceptance of the principle enunciated in Malec [v JC Hutton Pty Ltd (1990) 169 CLR 638] requires that damages for deprivation of commercial opportunity, whether the deprivation occurred by reason of breach of contract, tort or contravention of s 52(1), should be ascertained by reference to the court's assessment of the prospects of that opportunity had it been pursued. … On the other hand, the general standard of proof in civil actions will ordinarily govern the issue of causation and the issue whether the applicant has sustained loss or damage. Hence the applicant must prove on the balance of probabilities that he or she has sustained some loss or damage. However, in a case such as the present, the applicant shows some loss or damage was sustained by demonstrating that the contravening conduct caused the loss of a commercial opportunity which had some value (not being a negligible value), the value being ascertained by reference to the degree of probabilities or possibilities. It is no answer to that way of viewing an applicant's case to say that the commercial opportunity was valueless on the balance of probabilities because to say that is to value the commercial opportunity by reference to a standard of proof which is inapplicable." 85 The evidence of Messrs Hargreaves, Masi and Quinton is not admissible to contradict the finding, in Walker (No 1), that, by the fourth representation, Mr Walker suffered sufficient damage to sustain his pleaded cause of action in respect of the fourth representation. But I do not consider that the respondents are necessarily precluded at this stage of the proceedings from challenging findings about evidentiary facts as distinct from findings about ultimate facts: compare Blair v Curran at 532-3. The findings at [94] and [160] of the judgment on liability fall into the category of evidentiary facts. 86 If (as is the case) this evidence is inadmissible to show that there was no loss and damage suffered by Mr Walker, is it admissible on an alternative basis as tending to show the value of the opportunity that Mr Walker lost by acting in reliance on the second respondent's representation on 13 February 1998? That is, is the evidence admissible as tending to show the degree of probabilities or possibilities that Mr Walker might have secured a position with ABN AMRO had he had the opportunity? Mr Walker's own case was that, if Mr Fulton had told him that his employment with the first respondent was at risk, he would have taken successful steps to retain his employment with ABN AMRO. That is, Mr Walker claimed that had he had the opportunity he lost because of Mr Fulton's representation, there was a high probability (if not a certainty) that he would have secured a position somewhere in ABN AMRO global organization. The respondents are entitled to contradict this claim by adducing evidence to show that the value of the lost opportunity was less that that claimed by Mr Walker because there was no probability or a lower possibility of his securing a position than he claimed. The evidence of Messrs Hargreaves, Masi and Quinton is admissible because it is relevant to the value of the opportunity Mr Walker lost, subject to the now uncontrovertible assumption that the value of that opportunity was not negligible. 87 It might not have been open to admit this evidence on this basis if tendered solely to show that the value of this lost opportunity was negligible, and this was the only basis upon which the respondents sought to rely on it. As will be seen, the evidence did not in fact establish that the value of the opportunity was negligible; and this was not the only basis on which the respondents sought to rely on it.

The Applicant's Submissions 88 Mr Walker claims declaratory relief and damages against the second respondent in respect of the misleading and deceptive conduct constituted by the fourth and fifth representations. 89 In his Further and Better Particulars of Loss and Damage, Mr Walker claimed loss or damage resulting from the fourth representation referable to the salary and entitlements that he would have continued to receive as an ABN AMRO employee from 1998 until the end of 2004, as well as prejudice to reputation and career prospects and distress and vexation. He said that he had mitigated his loss to the extent of the remuneration he received and he referred to redundancy payments from ABN AMRO. By the end of the trial on damages, he sought loss of earnings until 30 June 2004. 90 In final address, counsel for Mr Walker contended that Mr Walker's evidence should be accepted in its entirety since almost none of it had been challenged. Referring particularly to the rule in Browne v Dunn (1894) 6 R 67 at 76-7 and authorities concerning its application, counsel observed that cross-examination was very largely limited to Dalkeith's financial accounts in the financial years 2002/2003 and 2003/2004; and, in particular, Mr Walker was not cross-examined about his prospects of remaining with ABN AMRO, his conversation with Mr Fulton about the one-month termination clause, or his attempts to find alternative employment after February 1998. 91 Counsel for Mr Walker submitted that the evidence adduced by the respondents was selective. He invited the court to assume that the respondents had "at least approached and probably proofed" witnesses including Messrs Young, Jerome Rowley and Reg Eccles and, referring to Jones v Dunkel (1959) 101 CLR 298 at 321, O'Donnell v Reichard [1975] VR 916 at 929 and Brandi v Mingot (1976) 12 ALR 551 at 559, submitted that the court should infer that their evidence would not have assisted the respondents' case. Having regard to this, the court should, so he submitted, more readily accept Mr Walker's evidence. Counsel also pointed out that none of Masi, Hargreaves and Quinton was on the board of ABN AMRO or the integration committee. 92 Counsel for Mr Walker submitted that, in a case such as this, the rules for assessing damages in tort, and not those for assessing damages in contract, were the most appropriate guide. Citing,amongst other authorities, Murphy v Overton Investments Pty Ltd (2004) 216 CLR 388 ("Murphy v Overton") and Pritchard v Racecage Pty Ltd (1997) 72 FCR 203 ("Racecage"), counsel submitted that recoverable loss would include damages for loss of wages over a period of years and associated benefits, as well as damages for personal upset, distress and humiliation. 93 Counsel for Mr Walker contended that the court should accept Mr Walker's evidence that, but for the second respondent's misrepresentation on 13 February 1998, Mr Walker would not have taken any further steps to end his employment with ABN AMRO but, on the contrary, would have taken successful steps to secure his employment within the merged organisation. 94 It was contended on Mr Walker's behalf that "the suggested effect of the evidence of the Respondents' three witnesses [was] greater than the reality", because none was a decision-maker in ABN AMRO. In this regard, it was said: "All that the evidence amounts to is that a BZW employee (Masi), who did not know the Applicant, did not consider him for the merged organization, and that Hargreaves did not press his case. Quinton, to whom the Applicant was 'the most outstanding' employee had a more limited role. In essence, the Respondents, who did not call any evidence from any actual decision-maker within ABN AMRO (such as Young, Rowley or Eccles), ask the Court to assume that a rational commercial organization with a professed policy of choosing the best person for its positions, would for some unspecified and inexplicable reason ignore its most outstanding employee." Counsel pointed out that Mr Walker's expertise was not, as the respondents at times suggested, limited to that of a gold analyst and was broadly based. 95 Referring to I & L Securities, Mr Walker emphasized that, so long as the respondent's misleading or deceptive conduct was a cause of the loss of employment, the fact that there may have been other causes or contributing factors was irrelevant. His counsel submitted that, at best, the evidence of Hargreaves, Masi and Quinton showed there were other contributing but irrelevant factors. Further, under the TPA, on the basis of Enzed Holdings Ltd v Wynthea Pty Ltd (1984) 57 ALR 167 ("Enzed Holdings") at 183, the court must, so counsel argued, make an award of damages once loss has been found, doing its best to quantify the loss even if a degree of speculation or guesswork is involved. 96 Further, referring to Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387 ("Waltons Stores"), counsel for Mr Walker submitted, that it would be unreasonable and unjust for the respondents to be permitted to rely on a course of action that they encouraged and supported in order to reduce his entitlement to damages. Consequently, in the circumstances, his entitlement to damages under the TPA should not be diminished "by reason of the steps taken by him to secure his early departure from ABN AMRO, or by any suggestion now made that his employment there was under any threat". Damages should, so counsel for Mr Walker submitted, be assessed on the basis referred to in O'Neill. 97 Mr Walker contended that, had he remained at ABN AMRO, he would have earned a total of $400,000 in 1998; $475,000 in 1999; $600,000 in 2000; $700,000 in 2001; $700,000 in 2002; $800,000 in 2003; and $400,000 for the first six months in 2004. He claimed a total of $4,075,000 by way of loss of earnings. He also contended that the severance and tax components of his redundancy payment should not be regarded as mitigation of his economic loss. He did not ultimately dispute that, if it were found that his employment would have continued until June 2004, an adjustment should be made to reflect the 1998 payment. If, however, it were found that his employment would not have continued to this date, he submitted that it would be inappropriate to offset the 1998 payment, because he would have been entitled to the same payment at a later date. 98 Mr Walker claimed a general sum of $100,000 in respect of prejudice to his reputation and career prospects as a consequence of the misleading and deceptive conduct. His counsel submitted that his business began to flourish from the time the decision on liability was delivered. He also claimed an amount of not less than $50,000 in respect of his distress and vexation in both his career and personal life. 99 In final address, counsel for Walker claimed damages in the sum of $33,000 (equivalent to one month's salary at ABN AMRO) in respect of the misleading and deceptive conduct constituted by the fifth representation. Counsel submitted that, as a result of that representation, Walker did not pursue alternative employment for a one-month period: see Walker (No 1) at [216]. The Respondents' Submissions 100 The respondents contended that the evidence of Hargreaves, Masi and Quinton should be preferred to that of Walker. The respondents pointed out that Walker had not called any independent witness to corroborate his own assessment of his prospects of remaining at ABN AMRO and that Hargreaves, Masi and Quinton were independent of the respondents. 101 In final address, the respondents submitted: "Hargreaves was the key decision maker regarding which employees would be offered ongoing employment because he was taking up the position of Head of Research in the merged business." Mr Hargreaves' evidence was, in their submission, to be given particular weight on this account. 102 The respondents contended that Mr Walker mistook the rule in Browne v Dunn because the evidence of Hargreaves, Masi and Quinton directly challenged his evidence and, in particular, his claim that, but for the fourth representation, he would have successfully taken steps to retain employment with ABN AMRO. Mr Walker's submissions concerning the selective nature of the respondent's evidence was to be rejected, so the respondents submitted, because Hargreaves and Masi and, to a lesser extent Quinton, were the relevant decision makers within ABN AMRO. The burden of proof lay with Walker and it was for him to make out his case. 103 The respondents accepted that the detriment found by the court to have been suffered by Walker was the loss of an opportunity between 13 February and 23 February 1998 to retain ongoing employment with ABN AMRO. The respondents' basic contention was that the court should reject Mr Walker's claim that there was a probability that he would have been able to retain his employment with ABN AMRO. Amongst other things, they referred to the fact that Lewis filled the position of head of resources from 6 February 1998; that Hargreaves had been designated head of research by 13 February 1998; and that by 12 February 1998, Masi had recommended to the integration committee that Walker be terminated. Their primary claim was that there was virtually no chance of his retention and that there was no compensable loss and damage. I reject this claim for the reasons already stated. In any case, having regard to the whole of the evidence, it is not an inference that I would draw. 104 Alternatively, the respondents submitted that the evidence of Hargreaves, Masi and Quinton showed that, if Walker had continued as an employee of ABN AMRO beyond 23 February 1998, then he would only have done so "for a very short period of time". They submitted that it was this very short period of employment that set the parameters of Mr Walker's entitlement to damages for loss of income under the TPA consistent with the principles in O'Neill. The respondents further submitted that account should be taken of the usual vicissitudes of life, including the possibility that Mr Walker's employment with ABN AMRO would have come to an end well before 30 June 2004. 105 The respondents argued that Mr Walker's reliance on Walton Stores was misconceived in two respects. First, the assessment of damages under the TPA is not informed by equitable principles; and, secondly, the effect of the evidence was that by 13 February 1998 Mr Walker prospects of ongoing employment at ABN AMRO were diminishing because of the decision making processes within ABN AMRO relating to the merger, not as a result of any steps taken by either respondent. 106 The respondents contended that there was no proper basis for the claim that Walker would have received $4,075,000 from February 1998 to June 2004 had he remained at ABN AMRO. The figure was based on Walker's assertion that his base salary at ABN AMRO was in the top quartile for directors at ABN AMRO, which, so the respondents said, was struck out as inadmissible. The respondents also submitted that Walker received the sum of $333,900.65 as a consequence of the termination of his employment and that this payment should be taken into account in assessing any entitlement to damages in contravention of the TPA. The respondents contended that Mr Walker's claims for damages for prejudice to reputation and career, as well as distress and vexation, should suffer the same fate as the claim for loss of earnings and had no proper foundation. 107 The respondents submitted that Mr Walker was not entitled to an award of damages in respect of the fifth representation. Walker had failed to provide any particulars of loss and damage, a fact noted by their counsel in opening and in their Contentions of Fact and Law. There was, so the respondents said, no evidence that Mr Walker suffered any damage as a result of not pursuing employment opportunities between 20 February 1998 and 20 March 1998.

Consideration of the TPA damages 108 Pursuant to s 87, there are a variety of orders that can be made to compensate for loss or damage caused by contravening conduct, or to prevent or reduce it: see Demagogue at 43 per Gummow J for a discussion of ss 82 and 87. Section 87(1) requires that the court consider that its order or orders will compensate "in whole or in part" for the loss or damage, or will prevent or reduce the loss or damage: compare also s 87(1A). In this case s 87(2)(d) is apposite. It provides that an order referred to in s 87(1) and s 87(1A) includes "an order directing the person who engaged in the conduct … to pay to the person who suffered the loss or damage the amount of the loss or damage". This case is not concerned with the quia timet operation of s 87 of the TPA. Indeed, the parties did not contend that the differences between s 82 and s 87 had any practical outcome in the assessment and award of damages in this case. 109 The object of an award of damages is to place Mr Walker in the position he would have been in but for the contravening misrepresentations: see Gates v City Mutual Life Assurance Society Ltd (1986) 160 CLR 1 ("Gates") at 13-14 and Wardley at 525-6. He may be compensated for consequential losses flowing directly from the misrepresentations including losses from opportunities foregone: compare Henville v Walker (2001) 206 CLR 459 at 502-3 per McHugh J, with whom Gummow J agreed, and 509 per Hayne J, with whom Gummow J also agreed. Section 4K of the TPA also provides that "loss or damage" includes a reference to injury. Thus, the loss or damage to which s 82 and s 87 refer is not limited to economic loss: see Murphy v Overton at 407 and Racecage at 217-8 per Branson J, with whom Spender and Olney JJ agreed, and the authorities cited therein. 110 An award of damages should compensate Mr Walker for all the loss or damage occasioned him by the misrepresentation. It is enough to demonstrate that the contravention of s 52 was a cause of the loss or damage sustained: see I & L Securities at 130 per Gaudron, Gummow and Hayne JJ. 111 Furthermore, if a litigant has established an entitlement to damages, he or she is not to be deprived of the benefit of this entitlement merely because an assessment of damages is difficult. A Full Court of this Court (Sheppard, Morling and Wilcox JJ) said in Enzed Holdings at 183: "The principle is clear. If the court finds damage has occurred it must do its best to quantify the loss even if a degree of speculation and guess work is involved. Furthermore, if actual damage is suffered, the award must be for more than nominal damages. We should add that we can see no reason why this principle should not apply in cases under the Trade Practices Act as well as in cases at common law." 112 It by no means follows from this, however, that an applicant can recover substantial as opposed to nominal damages if he does not prove both the fact and the amount of damage: see Commonwealth v Amann Aviation Pty Ltd (1991) 174 CLR 64 ("Amann") at 80 per Mason CJ and Dawson J, 99 per Brennan J, 118 per Deane J and 137-8 per Toohey J. In JLW (Vic) Pty Ltd v Tsiloglou [1994] 1 VR 237 ("Tsiloglou") at 241, Brooking J said: "If he proves the fact of the loss but does not call the necessary evidence as to its amount he cannot be awarded substantial damages (McGregor on Damages, 14th ed., pp. 190 and 222): he must put the tribunal in the position of being able to quantify in money the damage he has suffered: Watts v. Rake (1960) 108 C.L.R. 158, at p. 159, per Dixon C.J. So juries in personal injuries cases are often directed that the plaintiff must prove to their satisfaction what he has suffered and will suffer and what is fair and reasonable compensation in respect of that. It is often said that the amount of the damage must be proved with certainty, but this only means as much "certainty" as is reasonable in the circumstances: Ratcliffe v. Evans [1892] 2 Q.B. 524, at pp. 532-3. Where precise evidence is obtainable, the court naturally expects to have it; where it is not, the court must do the best it can: Biggin & Co. Ltd. v Permanite Ltd. [1951] 1 K.B. 422, at p. 438; The Commonwealth v Amann Aviation Pty. Ltd., at C.L.R. p 83, per Mason C.J. and Dawson J." In an assessment for pain and suffering, for example, "the matter must necessarily be left to the opinion of the court, acting at large" but "even in such a case the plaintiff must put the court in the position of being able to quantify in money the damage he has suffered": Tsiloglou at 245. 113 In this case, it is necessary to determine what Mr Walker would have done if he had not relied on the representation made on 13 February 1998. If he established that he would probably have secured employment with ABN AMRO, then he might have succeeded in obtaining an award of damages commensurate with the salary and other benefits that he would thereby have gained. This is consistent with the approach recommended by the Full Court (Carr, Moore and Marshall JJ) in O'Neill. In that case, the applicant sought damages under s 82 of the TPA for a contravention of s 52, constituted by the respondent's misrepresentations about his security of employment if he accepted its job offer. The Court said, at 466: "There ultimately appeared to be no issue that the Federal Magistrate might assess damages in the following way. The misleading and deceptive conduct led Mr O'Neill to leave his secure employment and take other employment with MBF. He therefore left a job at a particular level of remuneration and took up other employment which came to an end a little over two years later. He was then employed in occasional temporary employment and then in more permanent employment. Any loss he suffered was the loss flowing from him relying on the misleading and deceptive conduct. One way the loss could be quantified would be to ascertain the difference (if any) between the salary he would have been earning in employment with National Mutual and the income he then received in the position with MBF and in the employment he entered or might enter after being made redundant by MBF. The damages would be the difference over the period it was likely Mr O'Neill would have stayed in employment with National Mutual." 114 As will be seen, the evidence did not establish that Mr Walker would probably have secured employment with ABN AMRO if he had not relied on the second respondent's representation on 13 February 1998. The evidence established that Mr Walker lost an opportunity to take steps to try to secure a position for himself within ABN AMRO; and that there was a possibility, not a probability, that he would have been successful had he taken advantage of the opportunity. What was the value of this opportunity? This is the real question for present purposes. 115 I deal first with some preliminary matters. I accept that, as the respondents submitted, the rule in Browne v Dunn does notapply where a witness is on notice that his version of events is challenged and such notice is found in an opening or in the manner in which a case is conducted: see White Industries (Qld) Pty Ltd v Flower & Hart (1998) 156 ALR 169 at 218 per Goldberg J. The respondents clearly put Mr Walker on notice that they challenged his evidence concerning his prospects of remaining with ABN AMRO, both in opening and in the way they conducted their case, especially in their reliance on the evidence of Hargreaves, Masi and Quinton. The rule in Browne v Dunn does not require that Mr Walker's evidence about his prospects of remaining at ABN AMRO be accepted, although I would accept his evidence regarding his attempts to find alternative employment, which was not really challenged. (I return to the conversation with Mr Fulton about the one-month termination clause below.) 116 I reject the assertion that the respondents would probably have proofed Young, Rowley or Eccles prior to the trial on damages. Their failure to be called is not relevant to an evaluation of the respondents' case. I also reject the submission that the evidence adduced by the respondents was selective. 117 Further, as already indicated, I accept that the evidence of Hargreaves, Masi and Quinton is relevant to an assessment of the value of the opportunity Walker lost in attempting to secure a position at ABN AMRO because of his reliance on the second respondent's representation made on 13 February 1998. This assessment is complicated by the fact that Mr Walker's prospects of employment had already reduced by 13 February 1998: see Walker (No 1) at [88]-[91], [94] and [113]. 118 The position is this. Between 16 January 1998, when he signed a written offer of employment, and 20 February 1998, when he was told that the deal was off, Walker believed that he was going to a position with the first respondent and then the second respondent. For this reason, prior to 13 February 1998, he did not make any genuine effort to secure a position in the merging organisation; and, for example, did not attend meetings in Melbourne in the New Year about the new organisation. In mid-January 1998, Quinton informed Hargreaves that Walker was a skilled analyst although he raised doubts about his retention in the event that Lewis was preferred as head of resources (research). On 3 February 1998, Walker had a brief conversation with Mr Hargreaves, who was to head the newresearch department, and confirmed that he was not intending to stay. Walker sought details of ABN AMRO's redundancy policy in early February 1998. From 5 February 1998, there were rumours in the market about his leaving ABN AMRO for a new position. Mr Fulton, conceded that he told Coles, a personnel consultant, of Walker's move to the respondents in February 1998. On 6 February 1998, Lewis was appointed to a position in the merged organisation that was equivalent to Walker's position at ABN AMRO before the merger. 119 Around 12 February 1998, unbeknown to Walker, Masi recommended to the integration committee that Walker be terminated. There is no evidence as to precisely when the integration committee accepted this recommendation, although it did so at some time on or after 12 February 1998 and before 23 February 1998. The company later required that requests for voluntary redundancy be lodged by 20 February 1998. It seems more probable than not, therefore, that the integration committee had not accepted Masi's recommendations at the time the second respondent made the representation on 13 February 1998. The second respondent's misleading and deceptive conduct thus deprived Mr Walker of the opportunity to take such steps as he could to secure a position before the integration committee met and it deprived him of the opportunity to seek to undo the effect of any adverse decision made by the committee. 120 What is more, following the second respondent's representation, Mr Walker made it virtually impossible for him to stay on at ABN AMRO by instructing his solicitors to write their letter of 16 February 1998 alleging constructive dismissal and actively seeking redundancy. Had the second respondent not made this representation, there can be little doubt that Walker would have taken immediate steps to seek out a position in the merged organisation or in ABN AMRO's global network. He would not have pursued voluntary redundancy or instructed his solicitors to take the tack they did. 121 As we have seen, the respondents argued that Mr Walker had virtually no chance of securing a position on or after 13 February 1998. They relied on various circumstances including that: (1) Masi and Hargreaves only considered Lewis for head of resources (research); (2) the BZW research team was regarded as an asset to be retained in preference to the ABN AMRO staff; (3) Hargreaves, who was to be ultimately responsible for the research department, did not recommend to Masi that any ABN AMRO analysts be retained; (4) after the merger, there was no full-time research position for a gold analyst such as Walker had been; (5) by the time a recommendation reached board level, it was very much a "fait accompli"; and (6) there were not many opportunities in the ABN AMRO global network for ABN AMRO people displaced by the merger. The respondents also referred to the effect of the Asian economic downturn on employment and the reduction in employment in the resource investment industry and related sectors. 122 I accept that if Mr Walker had set out to find a position in the merged organisation or ABN AMRO's global network as at 13 February 1998, it would have been difficult, but not impossible, for him to do so. Plainly enough, by this date, the integration process had moved into its final stages and decisions about on-going employment were about to be made. It is unlikely, however, that, as at 13 February 1998, any final decision had yet been made. There remained a window of opportunity after 13 February 1998 for Walker to find a job within ABN AMRO's global network. 123 There were factors militating in Walker's favour even at that stage. He had an excellent record at ABN AMRO. Quinton regarded him as the best ABN AMRO person in his field prior to the merger. Although he had been employed as a gold analyst prior to the merger, his expertise extended well beyond gold. He had been on the executive committee and had had an important role to play for the Group. He had good professional relations with the chairman of the board and the managing director. As at 13 February 1998, he was prepared to move to a position anywhere in ABN AMRO's global network except South Africa. 124 Mr Walker's good standing is significant because it was then ABN AMRO's stated policy to place staff displaced by the merger elsewhere in its network if it could. This is apparent from the company's memorandum to staff of 12 January 1998. It was confirmed by the evidence of Mr Hargreaves and Mr Masi. The latter specifically acknowledged that he had a responsibility to keep the best people in the business and that it would have been open to him to have referred an individual to the integration committee had the person wanted to seek out an opportunity within the organisation. 125 Furthermore, it must be borne in mind that Masi's recommendation to terminate Walker was not based on any unfavourable assessment of him by Masi or, indeed, Hargreaves or Quinton. The recommendation was the product of a number of factors, including that neither Masi nor Hargreaves knew much, if anything, about him and no-one (not even Walker) put his name forward as an individual to be retained. Masi came from BZW and relied on Lewis (and Hooker), with whom he had previously worked, and Hargreaves for advice about who should be retained. Hargreaves, who was new to ABN AMRO at the relevant time, relied on Quinton for advice about ABN AMRO's research department. Quinton did not press Walker's case to Hargreaves, although he had a high opinion of Walker's skill, because he believed that (1) Lewis would be preferred over Walker and (2) Walker was going to another position with a different employer. 126 Precisely when Hargreaves and Quinton learned that Walker was going is unclear. Walker's evidence at the trial on liability was that Hargreaves understood that he was not looking to be retained as early as 3 February 1998. There was also evidence that from 5 February 1998 there were rumours in the marketplace that he was leaving ABN AMRO. Quinton, who spoke to Hargreaves about Walker leaving, had heard these rumours at some time. This appeared from Quinton's evidence and from his annotation on Walker's 2 February 1998 memorandum. Indeed, Hargreaves recalled hearing that Walker had another position although he could not recall when he was told this. The terms of Quinton's annotation were responsive to the content of Walker's memorandum and are supportive of the fact that Quinton annotated the document before the announcement of Lewis' appointment on 6 February 1998. It is only the reference to "Salomons" that points to a later date, around 9 February, when the identity of the first respondent's purchaser apparently became public. In the end, the most that can be said is that the evidence as to when Quinton made his annotation is inconclusive although he probably made it on or before 9 February 1998. It is probable, however, that both he and Hargreaves had the information that Walker was leaving earlier, between 2 and 5 February 1998. After they had this information, it is also probable that they gave no further thought to the retention of Walker in the merged organisation. It is significant that, apart from a brief conversation with Hargreaves, Walker did not discuss with anyone at ABN AMRO his capacity to fill another role in the new organisation. 127 As already noted, the evidence established that Walker did not lose his employment at ABN AMRO because of the second respondent's misleading and deceptive conduct of 13 February 1998. Rather, the second respondent's misleading and deceptive conduct deprived him of the opportunity to press his case to remain with ABN AMRO. But for the second respondent's misleading and deceptive conduct on 13 February 1998, Walker would have taken steps to try to find a position for himself in the merging organisation or the global network. Had Walker not been reassured about his position by the second respondent on 13 February 1998, he would not have lost this opportunity. I reject the respondents' contention that his prospects of success were negligible. He had a more than negligible and less than a probable prospect of success in any endeavours to remain at ABN AMRO after the end of February 1998. On the evidence, I find that, as at 13 February 1998, Mr Walker had about a 33 per cent chance of securing a position at ABM AMRO. 128 How can Mr Walker be compensated for the loss of this opportunity? One way is to estimate its value by reference to his earnings over the period he would have been likely to have stayed in a position with ABN AMRO. In his fourth affidavit, Mr Walker relied on certain surveys of the remuneration paid to employees similar to himself by ABN AMRO and other companies for the years 2001 to 2003 inclusive. I accept that, as the respondents submitted, there was no evidence before the court to justify Mr Walker's assertion that had he remained at ABN AMRO, his salary would have been in the top quartile of directors. I have therefore taken a figure that represents the average figure for ABN AMRO senior analysts at the relevant time. Based on these surveys and his evidence as to his 1998 salary, I arrive at the following figure for loss of earnings: 1998 1999 2000 2001 2002 2003 (half year) Total $400,000 $450,000 $507,100 $384,900 $550,100 $275,000 $2,567,100

These figures are arrived at with a broad brush, allowing for the vicissitudes of life, doing the best I can in the circumstances. 129 I would not allow Mr Walker's claim all the way through to mid 2004. I am not satisfied that loss or damage continued up to this later time, having regard to the financial performance of Dalkeith. I have rejected the respondents' submission that, in respect of the period 1 July 2002 to 30 June 2004, Mr Walker elected to pay himself a minimal salary to inflate his claim for damages. I accept, however, that in this period the evidence, including the evidence regarding Dalkeith's fees, investment practices and the funds available to it for investment purposes establish that, through his personal exertions, Mr Walker had built up a successful business enterprise. That it was his personal exertion follows from the fact that his wife was not an investment banker, although a shareholder, director and investor in its activities. In evaluating Mr Walker's claims, account must also be taken of Dalkeith's position, including its receipt of valuable options in lieu of fees. By the financial year ending 30 June 2004, Dalkeith had assets worth over a million dollars. 130 Mr Walker received the gross sum of $333,900.65 as a consequence of the termination of his employment and this payment should be taken into account in assessing any entitlement to damages in contravention of the TPA. He also received a total of around $84,859 by way of income from personal exertion. This is constituted by his receipts by way of income in the financial years 1999, 2000, 2001, 2002 and 2003. I also include Dalkeith's superannuation contributions for the financial year 2003 plus the vehicles costs discussed below less interest on money lent to Dalkeith. Although the respondents urged this course, I have not included in this calculation such part of Dalkeith's operating costs as included rent charged to the company for use of part of a residential premises. The evidence on this issue did not warrant the imputation that the respondents sought to make. I have included, however, approximately half the costs referrable to vehicles used by Mr Walker and his wife. Such costs should be considered a benefit of Mr Walker's position as a director: seeLau v Bob Jane T-Marts Pty Ltd [2004] VSC 69 ("Lau") at [74] (including the value of the use of a motor car in a damages award for breach of contract). Having regard to the motor vehicle expenses and depreciation amounts reported in Dalkeith's balance sheets I conclude that Mr Walker's use of a motor car for 1998 until mid 2003 should be valued at $12,500. 131 I interpolate that, generally, the parties relied on gross pre-tax figures, although counsel for Walker mentioned the effect of taxation on the redundancy payment. As I received no submission on this aspect of the calculation of damages, I have adopted the parties' own gross figures: see Bostik (Australia) Pty Ltd v Gorgevski (No 1) (1992) 36 FCR 20 ("Bostik") at 33 per Sheppard and Heerey JJ (calculating damages using gross figures) and Wheeler v Philip Morris Ltd (1989) 97 ALR 282 at 312-3 per Gray J (noting that, as awards of damages are subject to tax, it is appropriate to use gross figures). It would be anomalous to adopt a different basis for the redundancy payment. 132 I now turn to calculating the value of opportunity that Mr Walker lost by the second respondent's misleading and deceptive conduct. At first blush, this calculation seems easy: it is 33 per cent of $2,567,100 or $855,700. However, great care must be taken when adjusting this figure in light of Mr Walker's income and payments in mitigation ($418,759.65). This amount is not simply to be deducted from $855,700. The relevant principles are discussed in detail in Ministry of Defence v Wheeler [1998] 1 WLR 637 ("Wheeler") and Hartle v Laceys [1999] 1 Lloyd's Rep P.N. 315: see also H. McGregor, McGregor on Damages, Sweet & Maxwell, London, 2003 at 8-059. I find these cases persuasive. They show that Mr Walker is entitled to $716,113.35. 133 This result is explained as follows. I have found that, if it were not for the second respondent's misleading and deceptive conduct, Mr Walker would have had a 33 per cent chance of securing a position at ABN AMRO (valued at $855,700). A corollary of this is that he had a 67 per cent chance of not securing a position with ABN AMRO. We know the value of this chance because it is corresponds to what actually happened. It has a value of 67 per cent of Mr Walker's actual earnings (67 per cent of $418,759.65) which is $279,173. Thus, if it were not for the second respondent's misleading and deceptive conduct, Mr Walker would have had two chances with a combined value of $1,134,873. 134 As a result of the fourth representation, Mr Walker found himself with a 100 per cent chance of not finding a position at ABN AMRO. In that situation, Mr Walker received $418,759.65in mitigation. Accordingly, his damages are the value of what he lost ($1,134,873) minus his earnings in mitigation ($418,759.65). This equals $716,113.35. If this somewhat condensed analysis is difficult to follow, Swinton Thomas LJ provides a thorough explanation of the relevant principles in Wheeler. 135 Damages may be awarded for losses consequential upon misleading and deceptive conduct: see Zoneff v Elcom Credit Union Ltd (1990) 94 ALR 445 at 467-8 per Hill J and, on appeal in (1990) 12 ATPR 41-058 at 51,747 per Burchett, Gummow and Foster JJ; and Crystal Auburn Pty Ltd v IL Wöllermann Pty Ltd [2004] FCA 821 at [162] per Goldberg J. Mr Walker did not provide much by way of particulars of his claims for consequential loss for reputation and distress. The evidence that the second respondent's misleading and deceptive conduct on 13 February 1998 caused loss of reputation and career prospects was slim. At the trial on liability, there was evidence that, as at the end of February 1998, Mr Walker's reputation had been injured by the second respondent's misleading and deceptive conduct. 136 There were also the circumstances that, notwithstanding his admitted expertise and endeavours, Walker could not find an equivalent position to that which he lost and Dalkeith's financial performance lifted after judgment on liability. These circumstances alone do not, however, permit me to draw the inference that the second respondent's misleading and deceptive conduct on 13 February 1998 was a direct cause of a consequential loss of reputation such that he is entitled to substantial damages on account of this conduct in respect of the loss. There was little other evidence. 137 The evidence on distress and vexation was also relatively slight. There was no expert medical or other evidence to corroborate Mr Walker's claims in this regard. Mr Walker's marriage broke down and he lost the day-to-day company of his children in the year after the second respondent's misleading and deceptive conduct. Mr Walker claimed that this was in the nature of consequential loss, but there is insufficient evidence to permit the conclusion that such consequential loss flowed directly from the respondent's conduct on 13 February 1998. I accept, however, that, in the circumstances of the case, the second respondent's misleading and deceptive conduct necessarily occasioned Mr Walker some distress and vexation. 138 In the circumstances of the case, I would award damages in the sum of $5,000 for all consequential loss, including damage to reputation and distress, occasioned Mr Walker by the second respondent's misleading and deceptive conduct. 139 Lest it be thought that the matter was overlooked, I do not consider that there is any scope in this case for the operation of the doctrines discussed in Walton Stores. 140 In respect of the fourth representation, damages should be assessed in the amount of $721,113.35. An order should be made that the second respondent pay this amount to Mr Walker on the basis that it provides the compensation referred to in s 87(2)(d) of the TPA. 141 In the circumstances of the case, no award for damages should be made in respect of the misleading and deceptive conduct constituted by the fifth representation. Mr Walker gave no particulars of loss and damage prior to or at the trial on damages. This fact was specifically noted by counsel for the respondents in his opening and in written submissions. In the absence of any contrary indication from Mr Walker, the respondents were entitled to proceed with the trial on the basis that Walker did not pursue damages in respect of the fifth representation. It was not open to him to resile from the position he had adopted before and during the trial and assert a claim for damages in final address. There was no indication in the manner in which he conducted his case that he was intending to pursue the quantification of damages in respect of the fifth representation. In any case, the claim put forward by Mr Walker in final address was insufficiently made out in the evidence.

contractual damages 142 In giving judgment on liability, I found that the first respondent had repudiated and breached a contract of employment ("the contract") that it had concluded with Mr Walker: Walker (No 1) at [173]. The contract was formed when Mr Walker signed a letter of offer dated 12 January 1998 (the "third letter of offer") and delivered it to Ms Lancaster. 143 Under the general rule for contractual damages, "where a party sustains a loss by reason of a breach of contract, he is, so far as money can do it, to be placed in the same situation, with respect to damages, as if the contract had been performed": Robinson v Harman (1848) 1 Ex 850 at 855; see also Amann at 80 per Mason CJ and Dawson J. An applicant is entitled to recover such damages as arise naturally, that is, according to the usual course of things, from the breach, or such as may reasonably be supposed to have been in the contemplation of both parties at the time they made the contract as the probable result of the breach: Hadley v Baxendale (1854) 9 Ex 341 at 354; also Amann at 91-2. What was in the contemplation of the parties depends upon a consideration of the terms of the contract in the light of the matrix of circumstances in which it was made: see Amann at 92 per Mason CJ and Dawson J. 144 The parties presented very different accounts of how the general rules should apply in this case. The third letter of offer contained a heading "Conditions of Employment". Under this heading, there appeared the following: "This letter of appointment (and the attached Executive Conditions of Employment) set out conditions of employment under current policies and subject to your acceptance of this offer, will form part of your terms and conditions of employment. Your employment will also be subject to prevailing NatWest Markets Australia policies which may be amended from time to time." 145 The important area of dispute was the significance of a provision contained in the "Executive Conditions of Employment" referred to in the third letter of offer. This provision reads: "Either party may terminate the contract of employment by giving one month's notice in writing or in the case of the Company payment in lieu thereof. The Company reserves the right to terminate the agreement without notice in the case of misconduct or in the event of any material breach of the terms and conditions of employment." The parties disputed whether this provision was a term of the contract and, if it was, whether it limited Mr Walker's damages to one month's salary. 146 As a result of the dispute regarding the relevance of the termination clause, the parties submitted widely divergent figures for contractual damages. Mr Walker submitted a figure of $4,689,076 and the respondents submitted an amount of $22,916. The Applicant's Submissions 147 Mr Walker claimed an entitlement to lost salary and bonuses from March 1998 until 30 June 2004 less any loss mitigated by his remuneration during that time. This assumed that he would have been employed by the respondents for this entire period. In support of this contention, Mr Walker submitted that the agreement of the parties was for long term employment. Noting that the contract provided that he would receive "the title [of] Director of Research at the completion of the 1998 year", he maintained: "The particular terms of the contract, requiring an appointment to the position of Director of Research, at an increased salary at the end of the first year of $300,000 plus bonus, meant that the employment was to continue beyond twelve months." Moreover, he argued that, had the first respondent honoured the contract, he would have remained employed by the respondents well beyond the end of 1999. Citing Brennan J in Amann at 102, Mr Walker submitted that, in evaluating his benefits under the contract, the court did not consider the express terms of the contract alone, but also took into account his rights to benefits of any kind, whether expressed by the terms of the contract or ascertainable by reference to circumstances extrinsic to those terms. 148 In answer to the respondents' reliance on the contract's one-month termination provision, Mr Walker submitted, first, that it was not open to the respondents to rely on the provision on the assessment of damages because they had neither pleaded that his employment could be terminated on one month's notice nor had they made this contention at the trial on liability. Counsel for Mr Walker noted that Walker was not cross-examined on the existence of the one-month termination provision. 149 Secondly, Mr Walker submitted that the contract did not contain a one-month termination provision. This was because the termination provision, which was merely part of a "standard" set of terms and conditions, should yield to other terms found in the contract. In particular, he directed the court to "the agreement … found at trial, which include[d] terms that [he] would be employed until (at least) the end of 1998 and that he would be employed in the position of Director in 1999". He submitted that the one-month termination provision could not be invoked before January 2000. Referring to Finucane v New South Wales Egg Corporation (unreported, Lockhart J, 8 July 1988) ("Finucane"), he submitted that termination prior to January 2000 "would have deprived [him] of the benefits represented to him in the contract", because the contract had been found to be for "a long-term position, which [he] was entitled to expect to hold for at least one year". 150 Thirdly, Mr Walker claimed that Mr Fulton told him that the termination provision related only to dismissal for cause. That is, Mr Walker said that Mr Fulton told him that the one-month termination provision related only to circumstances of misconduct or serious inability to perform his duties. Noting that Fulton was not called at the damages phase of the trial and referring to the rule in Browne v Dunn, Walker submitted that this part of his claim was not challenged. Counsel for Mr Walker added that the court might imply a term that would permit dismissal on reasonable notice, and that, in the circumstances of the case, reasonable notice would be between six and 12 months. 151 Further, Mr Walker submitted that, even if the one-month termination clause was a part of the contract, the court should not limit Mr Walker's damages to one month's salary. Mr Walker cautioned against a mechanical application of the so-called "least burdensome" principle. Under this principle, where a respondent could have performed the contract in different ways damages should be assessed according to the form of performance that would be least onerous to the respondent: see, eg, Abrahams v Herbert Reiach Ltd [1922] 1 KB 477 at 482 per Scrutton LJ and Maredelanto Compania Naviera SA v Bergbau-Handel GmbH [1971] 1 QB 164 ("The Mihalis Angelos") at 202-3 per Edmund Davies LJ. Relying on Amann, Mr Walker argued that the courts must "have regard to the facts and evaluate the possible exercise of the right [of termination] in all the relevant circumstances of the case": compare Amann at 93 per Mason CJ and Dawson J. 152 According to Mr Walker, the facts showed that the respondents would not have invoked the one-month termination clause. Mr Walker claimed that a number of factors support this conclusion. They included that: (a) Both Mr Fulton and Mr Thomas claimed that if Mr Walker had delivered a signed copy of the third letter of offer to Mr Thomas on or before 20 February 1998 they would have honoured the contract; (b) Mr Fulton agreed that Mr Walker had an impressive CV and was an outstanding candidate; (c) The negative feedback about Mr Walker in February 1998 was of limited scope; (d) The respondents' employment records show that resources analysts and directors are generally employed for long periods; (e) The respondents' new employee's kit contained a policy that work performances would be reviewed, rather than employees simply being dismissed; and (f) There was no evidence of any organisational changes relating to the respondents that might have impacted on Mr Walker's job security. Mr Walker contended that, taken together, these factors showed that he would have remained employed by the respondents for the entire period for which he claimed damages (March 1998 through 30 June 2004). 153 Mr Walker contrasted his situation to that of an employee summarily dismissed for misconduct. If a purported dismissal for misconduct is found to be unjustified, the employer could then rely on a notice provision because the evidence would suggest that the employer intended to terminate the employment. Mr Walker agreed that the least burdensome principle could be applied in such a case. However, he claimed that the evidence in his case showed that he would have continued his employment with the respondents had the first respondent honoured the contract. 154 Referring to Baltic Shipping Company v Dillon (1993) 176 CLR 344 ("Baltic Shipping") at 362-3, Mr Walker claimed damages for distress. He also submitted that: "It would also have been in the (objective) contemplation of the parties that a repudiation of the contract by the First Respondent in breach of its terms would have a deleterious and prejudicial impact on the capacity of the Applicant to obtain other similar and appropriate employment." 155 Finally, Mr Walker cited two cases relating to franchise agreements, Far Horizons Pty Ltd v McDonald's Australia Ltd [2000] VSC 310 and Burger King Corporation v Hungry Jack's Pty Ltd [2001] NSWCA 187, for the proposition that his employment contract included an implied term imposing a duty of good faith and fair dealing. According to Mr Walker, such a duty would have prevented the respondents from summarily dismissing him under the termination provision. 156 Walker claimed an entitlement to damages consistent with his Further and Better Particulars of Loss and Damage. The Respondents' Submissions 157 The respondents argued that Mr Walker's contract gave both parties the right to terminate his employment upon the provision of one month's notice or payment in lieu. They argued that the termination provision says this in clear language and is not inconsistent, or even in tension, with any other provision of the contract. Having regard to the contractual salary package of $275,000 per annum, this equates to $22,916. 158 On the point of pleading, the respondents referred to the particulars under paragraph 14 of the Statement of Claim, which alleged that the terms set out in a document called "Executive Conditions of Employment" formed part of the offer of employment. These conditions included the one-month termination clause. 159 According to the respondents, the contract was for an indefinite period, subject to the rights of the parties to terminate it in accordance with the contract. The respondents accepted that Mr Walker's contract contained terms relating to future bonuses and promotions. However, they analogised these provisions to an entitlement to long service leave. Contracts often grant employees a right to long service leave after seven or ten years. Such provisions do not confer an entitlement to seven or ten years of employment. Similarly, the respondents argued, Mr Walker's contract conferred a right to a bonus and a promotion at the end of 1998 only if he were still employed at that time. 160 The respondents contested both the credibility and the relevance of Mr Walker's claims about his conversation with Mr Fulton concerning the termination provision. The respondents noted that Mr Walker deposed to this alleged conversation after he had heard the respondents' opening submissions concerning the termination clause. Accordingly, the respondents suggested that the Court should place little weight on Mr Walker's evidence on this issue. 161 The respondents submitted that, even if the Court were to accept Mr Walker's evidence, the conversation with Mr Fulton was of no consequence. The respondents argued that the primary reference point for ascertaining the mutual intention of the parties should be the terms of the signed third letter of offer. 162 Moreover, the respondents said: "Assuming, for the sake of argument, that the court is prepared to disregard the express written terms of the contract and any implied term regarding termination on reasonable notice, the Applicant would have the court find that he had a contract of indefinite term which could not be lawfully terminated, that is, a job for life. It is against this background, after having conducted his evidence in chief and after he had been afforded the indulgence during cross-examination of an adjournment to enable him to file a further affidavit dealing with Dalkeith's true income position, relative to its receipt of options and shares in lieu of fees, that Mr Walker sought to introduce new evidence on the topic of termination. That new evidence sought to deal with the question of whether the written terms of the contract would have been enforced by the First Respondent. Evidence of this kind had not previously been led and the circumstances in which it was introduced at the very end of a long trial ought … lead to the conclusion that the Court ought to give it no weight." The respondents noted that, at the trial on liability, Mr Walker gave evidence that he had read all the terms of the written contract. They submitted that, at no point prior to the fifth affidavit, did Walker "suggest a conversation of the kind now relied upon nor indeed did he suggest any variation of the terms of the written letter of offer to accommodate such a provision as now relied on". 163 Having argued that the contract contained a one-month termination clause, the respondents relied on the remarks of Sheppard and Heerey JJ, with whom Gray J agreed, in Bostik at 32 in support of the submission that Mr Walker's entitlement to damages was one month of his salary package of $275,000 per annum. The respondents noted that Bostik was applied in Bruce v AWB Ltd (No. 2) (2000) 101 IR 296 ("Bruce (No. 2)")at 297-8. Having regard to my finding that the parties agreed that Walker was to commence employment with the first respondent on 2 March 1998, the respondents submitted that the first respondent could lawfully have terminated his employment at any time subsequent to this date upon the provision of one month's notice. 164 In the respondents' view, it was straightforward that this principle limited Mr Walker to recovering a single month's salary. They rejected Mr Walker's claim that the evidence showed that he would have remained employed by the respondents until 2004 despite the termination clause. The respondents suggested that, in light of the fact that Mr Walker's employment was terminated on 20 February 1998, Mr Walker's submissions on this issue have "an air of unreality". 165 Referring to Ridge v Baldwin [1964] AC 40 ("Ridge v Baldwin") at 65, Byrne v Australian Airlines Ltd (1995) 185 CLR 410 ("Byrne") at 443 and Intico (Vic) Pty Ltd v Walmsley [2004] VSCA 90 ("Intico") at [29], the respondents submitted that the fact that the parties were involved in the negotiation of long-term contract did not impair the first respondent's right to terminate in accordance with the notice provision. Nor did the fact that Walker regarded his employment as "permanent". 166 As an alternative submission concerning termination, the respondents contended that, if the Court were to find that it was a term of the contract that Walker would be employed from 2 March 1998 until at least the commencement of 1999, he could then have been lawfully terminated upon the provision of one month's notice to take effect on 31 December 1998. According to the respondents, such notice could have been given to him on 30 November 1998, to take effect 10 months after the agreed commencement date of 2 March 1998. On this submission, Mr Walker's entitlement to damages would be 10 months' salary ($229,166) plus the $250,000 bonus. 167 The respondents also argued that, if the previous submission was not accepted, there ought to be implied in the contract a term that the contract could be terminated upon reasonable notice. They referred to Rankin v Marine Power International Pty Ltd (2001) 107 IR 117 and Quinn v Jack Chia (Australia) Ltd [1992] 1 VR 567. 168 The respondents submitted that the Court should not find an implied obligation to exercise good faith and fair dealing in terminating the contract. The respondents argued that the authorities cited by Mr Walker were inapposite because they dealt with franchise contracts rather than employment contracts. The respondents submitted that the authorities established that there was no obligation upon an employer to exercise good faith and fair dealing in terminating a contract of employment, again citing Ridge v Baldwin, Byrne and Intico, as well as Aldersea v Public Transport Corporation [2001] 3 VR 499 ("Aldersea") and Johnson v Unisys Ltd [2001] 2 All ER 801 ("Johnson v Unisys Ltd"). 169 Finally, the respondents contended that Mr Walker had not provided the Court with a satisfactory explanation of his income over the period 1 July 2002 to 30 June 2004. They contended that Baltic Shipping was authority for the proposition that damages for distress were not available: see Baltic Shipping at 361 and Aldersea at 509-10. Consideration of Contractual Damages 170 I find that Mr Walker's employment contract contained a valid termination provision conferring on both parties a right to terminate on one month's notice. The first respondent also had a right to pay one month's salary in lieu of this notice. Accordingly, Mr Walker is entitled to one month's salary as damages for breach of contract. 171 In the particulars under paragraph 14 of his Statement of Claim, Mr Walker stated that the alleged contract that is the subject of these proceedings was "partly in writing and partly oral". Further: "Insofar as it was in writing it was constituted by a letter of offer from NatWest dated 12 January 1998. … Insofar as it was oral, it was constituted by a discussion in Sydney on 15 January 1998 between the Applicant and representatives of NatWest, Mr Thomas, Ms Lancaster and Mr Fulton. The substance of the discussions was that NatWest was offering employment on the terms and conditions set out in the letter of offer and the attachment thereto. …" 172 At the trial on liability, the principal issue on liability for breach of contract was whether Walker had accepted the offer contained in the third letter of offer: see Walker (No 1) at [153]. As the particulars indicate, the parties proceeded on the basis that, save for the matter of acceptance, the terms and conditions of any concluded contract were contained in the third letter of offer, including its attachment. The Court determined the question whether there was a contract on this basis: see Walker (No 1) at [64], [68], [78], [79], [80], [81], [83], [155], [156], [157] and [171]. The observations at [203] are to be read in the light of the conclusion that Walker was offered and accepted a contract of employment upon the terms set out in the third letter of offer. As the respondents noted, the reference to "these promissory representations" in [202] and to "promissory representations" in [203] is properly read as a reference to the offer of a salary of $275,000, the minimum bonus of $250,000 and the other benefits referred to in the third letter of offer. The passages at [63] and [192], upon which Mr Walker also relied, are not findings about the terms of the contract. 173 In cross-examination, Mr Walker gave specific evidence at the trial on liability that he considered the Executive Conditions of Employment referred to in the third letter of offer to be acceptable and conveyed this to Ms Lancaster. Also in cross-examination, Walker gave evidence that the first respondent had rejected his proposal for a two year fixed term agreement. 174 Bearing in mind the matters mentioned above, I reject Mr Walker's submission that it was not open to the respondents, at this stage of the proceeding, to rely on a termination provision that derives from the very contract that he identified in his pleading and that the Court found to exist. The written contentions filed by the respondents before the trial on damages gave clear notice that the respondents intended to rely on the termination provision. Although the notice provision was not relevant on the question of liability, it was clearly relevant to the quantum of damages. 175 I also reject Mr Walker's submission that the termination provision was merely a "standard term" that should give way to other terms in the contract. The language of the termination provision was crystal clear. It created mutual rights and obligations for the parties. Under the provision, Mr Walker was also entitled to terminate the contract upon the provision of one month's notice (just as he said was the case under his contract with ABN AMRO). 176 Further, there is no inconsistency between the termination provision and other terms of the contract. Although Mr Walker was entitled to a bonus and a promotion at the end of 1998, he would only be entitled to these benefits if he was still employed by the respondents. The respondents' analogy to long service leave is apt. Many contracts contain provisions relating to future dates or events. It does not automatically follow that these contracts are for a fixed term until such events occur or dates are reached. 177 As I found in my earlier reasons for judgment, the provision relating to Mr Walker's appointment as director of research in January 1999 showed that the parties hoped that Mr Walker would remain employed by the first respondent until that date and beyond: see Walker (No 1) at [62]-[63]. This was not, however, a provision of the contract. There was no mutual promise that Mr Walker would remain with the first respondent for a fixed term. 178 In this case, as with other senior executive appointments, the parties expected that the employment would be long term. However, an employment contract is not for an extended term simply because the parties had a general expectation that the employment was likely to be for a long period: see, eg, Lau at [10]-[12] where Osborn J found that the parties had discussed the period of employment and the employer had suggested that it would be for five to seven years, but that there was no agreement for a fixed or minimum term of employment. His Honour reasoned, at [12], that "[t]he letter setting out the terms of remuneration would surely have recorded that the salary referred to was one offered for a fixed or minimum term if this was the case". In this case, there is even stronger evidence, in the form of the explicit termination provision, showing that the employment contract was not for a fixed or minimum term. 179 The evidence that Mr Walker purported to give in paragraphs 9 and 10 of his fifth affidavit was admitted as relevant to circumstances extrinsic to the actual contract. Mr Walker submitted that Amman made these circumstances relevant to the assessment of damages and an evaluation of the likelihood that Mr Walker would have remained in the respondents' employ until June 2004. It was not admitted as evidence of the terms of the contract: see Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337 at 352 and Marks v GIO Australia Holdings Ltd (1996) 63 FCR 304 at 316. But even if this evidence were capable of constituting evidence of the agreement that the parties reached, it would not lead me to conclude that it constituted some qualification on the termination provision in the Executive Conditions of Employment. 180 Mr Walker was not cross-examined on paragraphs 9 and 10 of his fifth affidavit and Mr Fulton did not give evidence in the trial on damages. In his fourth affidavit, Mr Walker said that he discussed the termination provision with Mr Fulton. His commentary about this conversation was held inadmissible and, as a consequence, he subsequently tendered the further evidence in his fifth affidavit, which had a specificity altogether lacking in any other evidence he had given. Let it be accepted that Walker had a discussion about the termination provision; nonetheless I attach little significance to this discussion. As already noted, Mr Walker's evidence was that he read the third letter of offer, including the Executive Conditions of Employment, very carefully before he signed and returned the letter, which Mr Thomas had already signed, to Ms Lancaster. He was aware of the termination provision because he discussed it with Mr Fulton. The termination provision was clear and unambiguous. Moreover, the termination provision distinguished between termination for misconduct (which required no notice) and termination generally (which required one month's notice). Mr Walker could not have reasonably concluded that the termination provision only applied to dismissal for cause, even if he took a degree of comfort from Fulton's reassurance. 181 For the above reasons, I find that the parties agreed that the contract could be terminated by either side upon the provision of one month's notice. 182 Having found that the contract contained a one month termination provision, I turn to the significance of this provision for damages. The respondents are correct that "[w]here a contract is simply terminable on notice, this means that damages may in general only be claimed for wages and other benefits lost over the relevant period of notice": B. Creighton and A. Stewart, Labour Law, 4th ed, The Federation Press, 2005 at 447. However, as Mr Walker submitted, the so-called "least burdensome principle" cannot be applied mechanically in every case: see Amann at 93 per Mason CJ and Dawson J, 114 per Brennan J, 132-3 per Deane J, 146 per Toohey J and 150 per Gaudron J. 183 Amann concerned a three year contract between Amann Aviation Proprietary Limited ("Amann") and the Commonwealth of Australia for aerial surveillance of Australia's north coast. When the company commenced surveillance it did not have sufficient suitable aircraft and it spent a large amount acquiring such aircraft. The Commonwealth purported to terminate the contract by serving notice. The notice was invalid but the company treated it as a repudiation of the contract and sued for damages. 184 The Commonwealth, citing The Mihalis Angelos, argued that it was not liable for damages because it could have validly cancelled the contract under a termination clause. The relevant principle in The Mihalis Angelos was stated at 210 by Megaw LJ as follows: "If the contractual rights which he has lost were capable by the terms of the contract of being rendered either less valuable or valueless in certain events, and if it can be shown that those events were, at the date of acceptance of the repudiation, predestined to happen, then in my view the damages which he can recover are not more than the true value, if any, of the rights which he has lost, having regard to those predestined events." The Commonwealth argued that, as it would have terminated the contract in any event, Amann suffered little or no damage. 185 The contract in Amann included a termination provision that laid down a complicated procedure: see Amann at 95-6 per Mason CJ and Dawson J. In the event of a breach, the Commonwealth was required to provide notice asking the company to show cause as to why the contract should not be cancelled. However, the Secretary of the Department of Transport ("the Secretary") made the final decision as to whether the contract should be cancelled. The Full Court of the Federal Court found that, under this procedure, the Secretary was not able simply to pursue the interests of the Commonwealth but was required to weigh any submissions by the parties. The High Court did not depart from this interpretation: see Amann at 96. 186 In Amann, there were competing arguments as to whether the contract would have been cancelled. Favouring cancellation was the fact that the company would have been unable to provide fully the coastwatch service for the first two months of the contract. The main argument against cancellation was that the company had made large expenditures to establish the service and it was unclear if a better alternative was available. Considering these facts, the Full Court of the Federal Court estimated that there was only a 20 per cent chance that the contract would have been cancelled under the termination procedure. The High Court agreed: Amann at 97. Accordingly, the High Court rejected the Commonwealth's contention that termination was inevitable. 187 Overall, the relevant holding of Amann concerning the least burdensome principle can be summed up in the words of Gaudron J at 150, as follows: "… contractual rights should be valued having regard to the known facts and, if the facts allow, it may be assumed that the contract would have been performed in the manner which most reduces the damages payable. But, and as a matter of common sense, in no case is an assumption to be made or maintained in the face of evidence pointing to the contrary." Accordingly, the Court must decide whether the facts allow it to assume that Mr Walker's employment contract would have been performed in the manner which most reduces the damages payable. 188 The facts in Amann and TCN Channel 9 Pty Ltd v Hayden Enterprises Pty Ltd (1989) 16 NSWLR 130 (a case referred to in Amann and relied on by Mr Walker) were very different from the facts under consideration in this case. 189 The facts strongly support the respondents on this issue. Most relevant is the fact that, on 22 February 1998, the first respondent did terminate its contract with Mr Walker: see Walker (No 1) at [136]-[138]. The first respondent did this because Mr Fulton decided that he did not want Mr Walker for the position for which he had been hired: see Walker (No 1) at [115]. Mr Fulton was unable to provide a coherent explanation for his sudden change of view about Mr Walker: see Walker (No 1) at [116]-[119]. Regardless, it was clearly established that, by 22 February 1998, the respondents did not want Mr Walker as an employee. This provides a strong basis for assuming that, had it not breached the contract, the first respondent would have invoked the one month termination clause. 190 In response to this evidence, Mr Walker mostly offered general facts that suggested he was a highly suitable candidate and that employees in similar positions with the second respondent usually worked for long terms. This evidence was of very limited relevance. The Court accepts that Mr Walker was a highly qualified candidate for the position for which he was hired. Nevertheless, the facts showed that the respondents did not want Mr Walker. The Court finds that the respondents' behaviour toward Mr Walker is a better guide than general background facts about Mr Walker's qualifications, staff continuity, or the respondent's employment policy. 191 There is one matter that Mr Walker relied on that warrants particular mention. Mr Fulton testified that the first respondent would have accepted that a contract was concluded if Mr Walker had provided a signed letter of offer at the meeting on 20 February 1998: see Walker (No) 1 at [129]. According to Mr Walker, this testimony shows that the contract would not have been terminated had the respondents realised that a contract had been concluded. Mr Fulton was a very unreliable witness with respect to the events of late February 1998. Nevertheless, for present purposes, I accept Mr Fulton's evidence since Mr Walker relied on it. 192 Unfortunately for Mr Walker, however, Mr Fulton's testimony does not support his position. In substance, all that Mr Fulton's evidence showed was that if there were a legally binding contract then the first respondent "had to stick with it". In fact, this evidence underscored how reluctant Mr Fulton was to employ Mr Walker. The evidence showed that Mr Fulton was disposed to avoid any legal obligation to employ Mr Walker if his lawyers advised that he could legally do so: see Walker (No 1) at [165]. This does not show that the first respondent would not have invoked the termination provision that the contract made available to it. 193 It is useful to compare the facts of this case to those of Bostik, Bruce (No. 2) and Martin v Tasmania Development and Resources (1999) 163 ALR 79 ("Martin"). In each of those cases, the Federal Court was required to determine damages for breach of an employment contract. 194 In Bostik, the respondent employee had been dismissed for violating a company rule against smoking. The primary judge found the dismissal to be in breach of the contract of employment and the respondent entitled to damages. On appeal, Sheppard and Heerey JJ, with whom Gray J relevantly agreed, said at 32: "[T]here was general discussion about the assessment of damages in a case such as this. The contract in question is a contract of employment which is terminable by either party on giving to the other the applicable period of notice provided for in the award. Where an employee is wrongfully dismissed, he is entitled, subject to mitigation, to damages equivalent to the wages he would have earned under the contract from the date of the dismissal to the end of the contract. The date when the contract would have come to an end, however, must be ascertained on the assumption that the employer would have exercised any power he may have had to bring the contract to an end in the way most beneficial to himself; that is to say, that he would have determined the contract at the earliest date at which he could properly do so … ." (Emphasis added) 195 Their Honours held, however, that these principles did not apply in Bostik because of another specific limitation in the contract on the right of the employer to dismiss the employee. Indeed, the Full Court found that, but for the improper dismissal, the employment would have lasted into the long term. Sheppard and Heerey JJ reasoned, at 33: "The common law principles do not assist the company in the present case because of the provisions of cl 9 of the Award which forms part of the contract of service. It provides in effect that the employer may not dismiss an employee, whether with or without notice, if the dismissal is harsh, unjust or unreasonable. It follows that the respondent had substantial security in his employment because he could not be dismissed unless the dismissal was not harsh, not unjust or not unreasonable. His Honour therefore had to consider the matter upon the basis that, were it not for the unlawful dismissal, it was likely that the employment would have continued indefinitely. … Nevertheless, one of the things that would need to be weighed up in reaching a conclusion would be the possibility that the employment might have come to an end as the result of a lawful dismissal which was not harsh, unjust or unreasonable, such as it might if the company were to close its factory or engage in a policy of retrenchment of all or some of its staff." Bostik should be distinguished from this case. The contract in Bostik restrictedthe employer's capacity to terminate the employee's contract of employment to a significantly greater extent than in this case. In contrast to Bostik, the termination provision in Mr Walker's contract allowed for termination on one month's notice. The result is that the common law principles discussed in Bostik assist the respondents here. 196 In Bruce (No. 2), the applicant had refused to accept changes to his position caused by a restructure and was dismissed without notice: see Bruce v AWB Ltd (2000) 100 IR 129 (finding the employer liable but deferring the question of damages). Sundberg J found that the respondent had breached the employment contract when it required the applicant to accept the terms of the restructure. The respondent argued that it could only be held liable for nine months' salary as the contract contained a provision allowing for termination on nine months' notice. His Honour agreed: see Bruce (No. 2) at 298. 197 It was apparent in Bruce (No. 2) that, because of the dispute over the restructuring, the respondent would have terminated the applicant's employment under the termination provision if it had not dismissed him without notice. This meant that, once it was accepted that a nine month termination provision was part of the contract, the applicant was entitled to damages equivalent to nine months' salary. 198 In Martin, the employment contract allowed for dismissal with notice on the basis of "operational requirements": see Martin at 83. The respondents claimed that they had validly dismissed the applicant on the basis of operational requirements: see Martin at 93. Heerey J found, at 96, that although the case for dismissal was weak, there were grounds for dismissal based on operational requirements. However, his Honour found that the respondents had breached the contract by not providing the required notice and not honouring a contractual requirement of consultation concerning the dismissal. The respondents argued that the applicant had not suffered any damages because of the failure to provide notice. Heerey J disagreed, reasoning, at 103, that given the flimsy basis of the dismissal, the applicant would have been able to convince the respondents not to dismiss him had notice been provided. 199 When assessing damages, Heerey J noted, at 100-1, that: "It is true that if … the employment is for an indefinite period terminable on a given period of notice then the employee cannot recover as damages more than the salary he or she would have got for that period of notice. In other words, the employee cannot be in any better position than he or she would have been had the contract been lawfully terminated by the giving of notice. However the present case is different. The contract was for a fixed term. Had the contract not been wrongfully terminated, Mr Martin would have enjoyed the benefits of the contract for the remainder of the term: Patterson v Middle Harbour Yacht Club (1996) 64 FCR 405." Again, these facts are distinguishable from Mr Walker's situation. In Martin, the contract was for a fixed term. Had the contract, like Mr Walker's contract, been terminable on notice, the applicant would have recovered only for the period of notice. No fault was found with these observations on appeal: Tasmania Development and Resources v Martin (2000) 97 IR 66. The Full Court of the Federal Court disagreed with Heerey J only on the issue of whether there were any "operational requirements" justifying the original dismissal. 200 These cases show that, where there has been a wrongful dismissal, courts will generally assume that, had the employer not used an improper process, the employer would have used any legitimate, contractual means to dismiss the employee, subject of course to any countervailing circumstances. The fact that the employer wrongfully dismissed an employee generally tends to show that the employer no longer wants to employ that person. Thus, courts must consider any legitimate termination options that were available to the employer under the employment contract. If the employment was for a fixed term then, absent cause, the employer would not have been able to dismiss the employee: see Martin at 101. Similarly, if the contract restricts the capacity of the employer to terminate the employee's employment, the employer might not have been able to dismiss the worker: see Bostik at 32. In contrast, if the contract allowed for termination on notice, courts will generally assume that the employee would have been dismissed on notice, subject, as I have said, to the circumstances of the case. Mr Walker's case falls into this latter category. Further, the circumstances of the case support the conclusion that the first respondent would have taken advantage of the one-month termination provision had it been so advised. Accordingly, Mr Walker is only entitled to damages equivalent to one month's salary. 201 Further, decisions such as Finucane and Sheldrick v WT Partnership (Aust) Pty Ltd (1998) 89 IR 206 ("Sheldrick") do not assist Mr Walker. In Finucane v New South Wales Egg Corporation (1980) 80 ALR 486, Lockhart J found, at 522-3, that it was a term of the applicant's cartage contract with the respondent that the contract could not be terminated in the short or middle term subsequent to his appointment, but that the respondent could terminate the contract thereafter in consequence of proposed changes to the distribution system for the marketing of eggs. In the present case, there is no contractual term that restricts the capacity of the first respondent to exercise the right to terminate the contract upon one month's notice or payment in lieu. 202 The present case is relevantly indistinguishable from Sheldrick. In Sheldrick, the applicant alleged that it was a term of his contract that he would be employed for a four year period, alternatively, that it was a term of his contract that the employer had a long term commitment to him. The primary judge found against him and this finding was not disturbed on appeal: WT Partnership (Aust) Pty Ltd v Sheldrick (2000) 96 IR 202. His Honour concluded that although the employer had made a long term commitment to him, the contract made this commitment terminable on three month's notice in writing: see Sheldrick at 224. 203 Mr Walker made a final attempt to avoid the conclusion that his entitlement to contractual damages was limited to one month's salary by arguing that his contract contained an implied duty of good faith. According to Mr Walker, the respondents could not have used the contract's termination provision without breaching such a duty. This argument fails because, under the common law, no duty of good faith is implied into employment contracts. 204 An implied term of good faith is sometimes found in commercial contracts: see Renard Constructions (ME) Pty Ltd v Minister for Public Works (1992) 26 NSWLR 234 and Burger King Corporation v Hungry Jack's Pty Limited [2001] NSWCA 187 at [141]-[168]. I do not need to review this line of authority, however, as it does not apply to employment contracts. 205 The "general law of the employment contract" in Australia does not impose a duty of "procedural regularity or fairness" on an employer's right to terminate a contract: see Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 443 per McHugh and Gummow JJ; see also Aldersea at 511-3 per Ashley J and Johnson v Unisys Ltd at 808 per Lord Steyn, 817-20 per Lord Hoffmann and 823 per Lord Millett. On occasion, statutory reform has modified the harsh operation of the common law. Eames J explained in Intico at [27]: "The common law permits an employer to act "unreasonably or capriciously if he so chooses", as stated by Lord Reid in Malloch v Aberdeen Corporation [[1971] 1 WLR 1578 at 1581]. That reflects the origins of the common law concerning termination of employment, the case law being replete with discussions as to the respective positions of "masters" and "servants". The principles stated by Lord Reid in that case, as discussed in the judgment of Buchanan, J.A., are now entrenched, and have only been overcome by statutory reform. In this case, however, the income level of the respondent denied to him such processes of procedural fairness as may have been applicable to his situation had the Workplace Relations Act 1996 applied." Like the respondent in Intico, Mr Walker was an upper-level employee and his contract is governed by the common law. Accordingly, the Court should not imply a duty of good faith into the contract. 206 I accept that, as the respondents contended, contractual damages for distress are not available in this case: see Baltic Shipping at 361 and Aldersea at 509-10. 207 In this case, Mr Walker's contractual damages should be assessed at $22,917. His starting salary with the first respondent was $275,000. That figure was inclusive of superannuation. Mr Walker is entitled to one month's salary as damages for breach of contract. One month's salary amounts to $22,917. This also represents the sum he should have been paid upon dismissal in the event notice was not given. Under the termination provision, the first respondent could have terminated Mr Walker's employment by paying that amount in lieu of providing notice. Bearing in mind that he was contractually entitled to, but did not receive, one month's notice or payment in lieu thereof ($22,917), no issue of mitigation arises. Furthermore, this award of contractual damages is not reduced by reason of damages assessed under s 87 of the TPA. Disposition 208 The first respondent should pay the applicant damages in the sum of $22,917. The second respondent should pay the applicant damages in the sum of $716,113.35. There has been no application for interest. 209 I have previously found that the second respondent engaged in misleading or deceptive conduct when it made the fourth and fifth representations. By his counsel, Mr Walker sought declaratory relief, which I am disposed to grant. 210 As indicated at the hearing, I would allow the parties to make further submissions on the question of costs, having regard to these reasons. The parties should indicate to what extent, if at all, they wish me to have regard to any submissions previously filed on the question of costs. I would also direct the applicant to file and serve proposed minutes of order in accordance with these reasons. The parties will have an opportunity to make submissions on the applicant's minute of orders if they so wish. I certify that the preceding two hundred and ten (210) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Kenny.

Counsel for the Applicant: C Gunst Q C with B Lawrence

Counsel for the Respondent: P Jopling Q C with M McDonald

Trade Practices Act 1974(Cth)

Walker v Citigroup Global Markets Pty Ltd [2005] FCA 1678 DAMAGES - measure of damages ‑ breach of contract of employment - whether damages limited to one month's salary - misleading and deceptive conduct - quantification of the value of a lost opportunity Trade Practices Act 1974 (Cth), s 52, s 82, s 87

Hunter v Chief Constable of West Midlands Police [1982] AC 529 referred to Williams v Spautz (1992) 107 ALR 635 referred to Blair v Curran (1939) 62 CLR 464 referred to Miller v University of New South Wales (2003) 132 FCR 147 referred to I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2002) 210 CLR 109 referred to O'Neill v Medical Benefits Fund of Australia Ltd (2002) 122 FCR 455 discussed Wardley v Australia Ltd v Western Australia (1992) 175 CLR 514 referred to Sellars v Adelaide Petroleum NL (1994) 179 CLR 332 referred to Demagogue Pty Ltd v Ramensky (1992) 39 FCR 31 referred to National Australia Bank Ltd v Maher (No 2) [1999] 3 VR 583 referred to Electricity Commission of NSW v Lapthorne (1971) 124 CLR 177 referred to Burns v Lipman (1975) 132 CLR 157 referred to Browne v Dunn (1894) 6 R 67 discussed Jones v Dunkel (1959) 101 CLR 298 discussed O'Donnell v Reichard [1975] VR 916 referred to Brandi v Mingot (1976) 12 ALR 551 referred to Murphy v Overton Investments Pty Ltd (2004) 216 CLR 388 referred to Pritchard v Racecage Pty Ltd (1997) 72 FCR 203 referred to Enzed Holdings Ltd v Wynthea Pty Ltd (1984) 57 ALR 167 referred to Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387 referred to Gates v City Mutual Life Assurance Society Ltd (1986) 160 CLR 1 referred to Henville v Walker (2001) 206 CLR 459 referred to Commonwealth v Amann Aviation Pty Ltd (1991) 174 CLR 64 discussed JLW (Vic) Pty Ltd v Tsiloglou [1994] 1 VR 237 referred to White Industries (Qld) Pty Ltd v Flower & Hart (1998) 156 ALR 169 followed Bostik (Australia) Pty Ltd v Gorgevski (No 1) (1992) 36 FCR 20 discussed Wheeler v Philip Morris Ltd (1989) 97 ALR 282 referred to Ministry of Defence v Wheeler [1998] 1 WLR 637 cited Hartle v Laceys [1999] 1 Lloyd's Rep P.N. 315 cited Zoneff v Elcom Credit Union Ltd (1990) 94 ALR 445; (1990) 12 ATPR 41-058 referred to Crystal Auburn Pty Ltd v IL Wöllermann Pty Ltd [2004] FCA 821 referred to Robinson v Harman (1848) 1 Ex 850 referred to Hadley v Baxendale (1854) 9 Ex 341 referred to

Finucane v New South Wales Egg Corporation (unreported, Lockhart J, 8 July 1988) discussed Finucane v New South Wales Egg Corporation (1980) 80 ALR 486 discussed Abrahams v Herbert Reiach Ltd [1922] 1 KB 477 referred to Maredelanto Compania Naviera SA v Bergbau-Handel GmbH [1971] 1 QB 164 referred to Baltic Shipping Company v Dillon (1993) 176 CLR 344 referred to Far Horizons Pty Ltd v McDonald's Australia Ltd [2000] VSC 310 referred to Burger King Corporation v Hungry Jack's Pty Ltd [2001] NSWCA 187 referred to Bruce v AWB Ltd (No. 2) (2000) 101 IR 296 discussed Ridge v Baldwin [1964] AC 40 referred to Byrne v Australian Airlines Ltd (1995) 185 CLR 410 referred to Intico (Vic) Pty Ltd v Walmsley [2004] VSCA 90 cited Rankin v Marine Power International Pty Ltd (2001) 107 IR 117 referred to Quinn v Jack Chia (Australia) Ltd [1992] 1 VR 567 referred to Aldersea v Public Transport Corporation [2001] 3 VR 499 referred to Johnson v Unisys Ltd [2001] 2 All ER 801 referred to Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337 referred to Marks v GIO Australia Holdings Ltd (1996) 63 FCR 304 referred to TCN Channel 9 Pty Ltd v Hayden Enterprises Pty Ltd (1989) 16 NSWLR 130 referred to Martin v Tasmania Development and Resources (1999) 163 ALR 79; (2000) 97 IR 66 discussed Sheldrick v WT Partnership (Aust) Pty Ltd (1998) 89 IR 206 discussed Renard Constructions (ME) Pty Ltd v Minister for Public Works (1992) 26 NSWLR 234 referred to Burger King Corporation v Hungry Jack's Pty Limited [2001] NSWCA 187 referred to Byrne v Australian Airlines Ltd (1995) 185 CLR 410 referred to H McGregor, McGregor on Damages, Sweet & Maxwell, London, 2003. B. Creighton and A. Stewart, Labour Law, 4th ed, The Federation Press, 2005. DAVID WALKER v CITIGROUP GLOBAL MARKETS PTY LTD (FORMERLY SALOMON SMITH BARNEY AUSTRALIA SECURITIES PTY LIMITED) AND CITIGROUP GLOBAL MARKETS AUSTRALIA HOLDINGS PTY LTD (FORMERLY SALOMON SMITH BARNEY AUSTRALIA PTY LIMITED) VID 531 OF 1998 KENNY J 23 NOVEMBER 2005 MELBOURNE

REASONS FOR JUDGMENT 1 The applicant, David Walker, seeks damages in respect of breach of contract and contraventions of s 52 of the Trade Practices 1974 (Cth) ("the TPA"). Mr Walker has already established the first respondent's liability for damages for repudiation and breach of a contract of employment with him: see David Walker v Salomon Smith Barney Australia Securities Pty Ltd [2003] FCA 1099 ("Walker (No 1)"). He has also established that the second respondent breached s 52 of the TPA by: (1) representing, on 13 February 1998, that, after its purchase of the first respondent, it would employ Mr Walker on the same terms and conditions as had been previously agreed with the first respondent; and (2) representing, on 20 February 1998, that it would be likely that a position would be offered to Mr Walker in its Corporate Finance department. 2 The following are my reasons for judgment on the assessment of damages. Save where necessary, I do not repeat the circumstances that led to the institution of these proceedings or findings of fact following the trial on liability: see Walker (No 1).

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