White v Norman; In the Matter of Forest Enterprises Australia Limited (Receivers and Managers Appointed) (in Administration) [2012] FCA 33

FEDERAL COURT OF AUSTRALIA

White v Norman; In the Matter of Forest Enterprises Australia Limited (Receivers and Managers Appointed) (in Administration) [2012] FCA 33 Citation: White v Norman; In the Matter of Forest Enterprises Australia Limited (Receivers and Managers Appointed) (in Administration) [2012] FCA 33

Parties: ANDREW WHITE v TIMOTHY NORMAN and SALVATORE ALGERI (AS RECEIVERS AND MANAGERS) OF FOREST ENTERPRISES AUSTRALIA LIMITED (ACN 009 553 548) (RECEIVERS AND MANAGERS APPOINTED) (IN ADMINISTRATION)

File number: VID 1018 of 2010

Judge: BESANKO J

Date of judgment: 2 February 2012

Catchwords: CONTRACT – principles of repudiation of contract – whether end of plaintiff's employment as chief executive officer amounted to termination under the contract or repudiation and acceptance of repudiation – whether failure to pay termination entitlements on date employment ceased constituted repudiation. Held: The events constituted termination of the employment under the contract. CORPORATIONS – Corporations Act – application of Div 2 Pt 2D.2 – scope of s 200F exceptions - where employment contract provided for payments of remuneration in lieu of termination notice – where plaintiff's employment terminated without notice – whether benefits constituted benefits "in connection with" plaintiff's retirement as contemplated by s 200A and required member approval in accordance with s 200E – whether benefits fell within s 200F(2)(a)(ii) exception – where plaintiff engaged under several employment contracts from 2003 to 2009 to hold position of chief executive officer – where benefits provided under 2009 contract – whether benefits provided as consideration for plaintiff agreeing to hold office for purpose of s 200F(2)(a)(ii) – construction of term "office" under s 200F(2)(a)(ii). Held: The benefits were benefits "in connection with" the plaintiff's loss of office for the purposes of Division 2 of Part 2D.2. The "consideration" referred to in s 200F(2)(a)(ii) is the consideration given by the company from time to time, and the benefits were consideration for the plaintiff holding office under the 2009 agreement. Payments of remuneration in lieu of notice within s 200F(2)(a)(ii). CORPORATIONS – Corporations Act – construction of ss 433 and 556 of the Act - Where plaintiff's employment ceased after appointment of receivers to company - whether plaintiff's leave entitlements had priority under ss 433 and 556 of the Act. Held: Some payments payable to the plaintiff were not due on or before the "relevant date" and are therefore not entitled to priority.