AVIRONE PTY LTD v PIRRIE and ANOR [1996] NSWCA 35

AVIRONE PTY LTD v PIRRIE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL

MEAGHER, HANDLEY and COLE, JJA 5 February 1996, 5 February 1996

[1996] NSWCA 35

CONTRACT of employment — wrongful dismissal — variation of contractual terms — acceptance of offer.

Meagher, Handley and Cole JJA The respondent, Kenneth Fair Pirrie, and his company, Kenneth Pirrie (Marketing) Pty Ltd sued Avirone Pty Ltd (Avirone) for wrongful dismissal of Mr Pirrie from his position as an employee of Avirone, charged with the responsibility of establishing Avirone in the Victorian market. Avirone sold clothing. We will distinguish between Mr Pirrie and his company only where it is necessary to do so.

His Honour Judge Bell upheld the respondent's claim for breach of the contract of employment awarding damages of $36,086.33. Interest on that sum was $45,863.31.

Avirone has contended on various bases that the judgment should be in the sum of $6,086.33, together with appropriate interest on that sum. The $30,000 challenged is a payment referred to in the contract of employment to which we will come.

His Honour Judge Bell found that on 9 September 1985 there was a contract of employment agreed between Mr Pirrie and Mr Storey on behalf of Avirone. The terms of that agreement were that Avirone would:

(a) Pay a salary of $25,000 per annum;

(b) pay design fees of $10,000 per annum to Kenneth Pirrie (Marketing) Pty Ltd;

(c) provide a car and petrol expenses;

(d) pay commission of 0.5 % of sales effected in Victoria;

(e) pay $30,000, as to half within two months and the other half within six months. Such payments to depend upon "performance" the details of which were not specified.

On 11 September 1985 Mr Pirrie commenced employment with Avirone.

The relationship between Mr Pirrie and Avirone deteriorated over the ensuing weeks. It is obvious that Mr Storey and Mrs Storey, directors of the appellant, were dissatisfied with his performance to the extent that Mrs Storey recorded his movements. They were concerned with his absence from the business, attending to business of his own. There were also concerns regarding absence of significant sales which had been generally discussed pre-employment although the agreement had not been made specific in terms of the contract of employment, or the specific basis for the payment of the $30,000 performance sum.