Industrial Relations Commission of New South Wales in Court Session CITATION : John Bastian v Noel Ashely Brent & ors practising under the business name PriceWaterhouseCoopers & Ors. [2001] NSWIRComm 316 PARTIES : John Bastian v Noel Ashley Brent & Ors practising under the business name PriceWaterhouseCoopers & Ors FILE NUMBER: IRC 2078 of 2000 CORAM: Haylen J Unfair contract - s 106 - international operation of group of companies - relationship between number of companies in group - transfer of employment - whether new contract or secondment - whether resignation from employment in Australia - representations as to continued employment - conditions of transfer to position in Singapore - jurisdiction - proper law of the contract - whether work with Singapore company sufficiently connected with New South Wales - objects and operation of joint venture company - termination of employment in Singapore - whether termination for cause - whether termination a redundancy - position not filled following termination - company performing below projections - identity of Australian employer - role of service company administering payroll - unfairness in manner in which contract entered - unfairness in provision of inadequate notice of termination - contract becomes unfair in its operation - mitigation - payment of discretionary bonus - loss on motor vehicle sold in Singapore - whether loss on motor vehicle compensable loss - contract and arrangement unfair - orders proposed for payment representing 10 months' salary on full package CATCHWORDS : LEGISLATION CITED : Industrial Relations Act 1996 s 106 Baker v National Distribution Services Ltd (1993) 50 IR 254 at 271 - 272 Brown & ors v Rezitis & ors (1970) 127 CLR 157 Chrysler Jeep Automotive Distributors (Aust) Pty Ltd v Canberra Star Motors Pty Ltd (1997) 79 IR 452 David Jones Ltd v Cukeric (1997) 78 IR 430 at 462 Davies v General Transport Development Pty Ltd (1967) AR (NSW) 371 per Sheldon J Ex parte Richardson re Hildred (1972) 2 NSWLR 423 Harcourt Brace & Co (Aust) Pty Ltd v Cory (1997) 81 IR 321 Maloney v Hoffman 1980 AR (NSW) 318 New South Wales Health and Research Employees Association of NSW (unreported, 31 March 1993, pp 80 - 83) CASES CITED : O'Brien v Australian Native Landscapes Pty Ltd (2001) NSWIRComm 145 O'Connor v Healey (1967) 69 SR (NSW) 111 Perception Pty Ltd & anor v Myalong Pty Ltd anor [2001] NSWIRComm 158 per Peterson J Perrott v XcelleNet Australia Ltd (1998) 84 IR 255 Pullen v R & C Products Pty Ltd (1994) 60 IR 183 Reich v Client Service Professionals of Aust Pty Ltd [2000] 99 IR 69. Renard Constructions (ME) Pty Ltd v Minister for Public Works [1999] 26 NSWLR 234 Rothmans Distribution Services Ltd v Full Court of Industrial Court of New South Wales [1994] 53 IR 157 at 160 Savage v Digital Equipment Corporation (Aust) Pty Ltd (1999) NSWIRComm 227 Termination, Change and Redundancy Case (1984) 8 IR 34 at 56 HEARING DATES: 09/19/2001; 09/20/2001; 09/21/2001; 09/27/2001; 09/28/2001 EXTEMPORE JUDGMENT DATE : 12/03/2001 APPLICANT: Mr G P McNally of Counsel SOLICITOR: Ms B. Nixon Bradfield & Scott LEGAL REPRESENTATIVES: Mr J J Fernon of Counsel SOLICITOR: Mr P Brown Baker & McKenzie JUDGMENT: - 86 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: HAYLEN J 3 December 2001 Matter No. IRC 2078 of 2000 John Bastian v Noel Ashley Brent & Ors practising under the business name PriceWaterhouseCoopers and Ors . Application under s 106 of the Industrial Relations Act 1996. JUDGMENT [2001] NSWIRComm 316 1 When John Bastian accepted a position to lead a PriceWaterhouse team in Singapore in 1997 he may well have felt that he had achieved a significant promotion and that he was well on his way to achieving the partnership status in PriceWaterhouse which he desired so much. By the middle of 1999 there was no position for him in Singapore, he was not wanted in Australia or Europe and, although seemingly on the brink of an appointment following his pivotal role in achieving the Athens Olympics contract for PriceWaterhouse, John Bastian was terminated. This case is about his claim that he was unfairly treated and that he was entitled to redundancy pay, reasonable notice and a discretionary bonus payment for his Athens Olympic contract achievements. In dealing with his claim it will be necessary to consider the relationship between PriceWaterhouse in its global operations and the method by which employees were transferred, seconded or appointed to international positions, both in pursuance of career development and in the interests of the global objectives of PriceWaterhouse. 2 The applicant, John Bastian, was a graduate of the University of New South Wales having obtained a Bachelor of Commerce degree in 1975 and a Degree of Bachelor of Laws in 1977. When he commenced these proceedings he was a member of the Institute of Chartered Accountants, a member of the Securities Institute of Australia and a member of the Institute of Chartered Secretaries. In early 1993, he worked as a consultant for PriceWaterhouse, a position he held for approximately six months until July 1993, when he was employed by that firm as an Associate Director. Initially, he was paid a base salary together with a yearly bonus which was paid quarterly. During 1994, he was promoted to the position of Director and in 1994, 1995 and 1996 he received bonuses, some of them substantial. 3 Mr Bastian's initial contract of employment was on PriceWaterhouse letterhead and was signed by Mr Ian Armstrong, as partner. It offered him the position of Associate Director in the corporate finance section "… on the staff of the Sydney office". The contract told him his total remuneration, including superannuation, would consist of base salary per annum and increments calculated from fee revenue generated, at least partly, as a result of his efforts. The increments would have a ceiling of $30,000 per annum and would be earned as 5 per cent of net revenue "… generated for the Australian firm of PriceWaterhouse in work related to infrastructure consulting". The letter of appointment required one month's notice of termination in writing by either party. It provided for the payment of long service leave in accordance with the provisions of the New South Wales Long Service Act as amended from time to time. 4 During 1994 and 1995, Mr Bastian became involved in a number of Sydney Olympic Games projects. This involved financial advising for a number of the aspects of the Games for PriceWaterhouse. As this work developed, Mr Bastian visited PriceWaterhouse's offices in Barcelona and Atlanta "to learn about the delivery of the Olympics in those cities and to bring this knowledge back to Sydney". 5 Mr Bastian said that in 1994 he developed the Infrastructure Services Group ("ISG") within the PriceWaterhouse Corporate Finance Division ("CFD"). In various publications of PriceWaterhouse he came to be described as the Director of the Infrastructure Services Group. In this role he was initially responsible to Mr Armstrong and then, between 1995 and 1997, he was responsible to and reported to Mr Allan Watson. Both Mr Armstrong and Mr Watson were partners of PriceWaterhouse in Australia. 6 During 1994, Mr Bastian had made contact with Mr Tony Poulter who was the head of Project Finance for the European firm of PriceWaterhouse based in London. The purpose of this contact was to form a closer relationship between the Australian ISG and Europe for the purposes of jointly developing the global business of the firm. He became involved in joint marketing calls with partners and staff from London to European companies and also introducing the expertise of the European firm into Australian transactions. In late 1995, Project Finance became an Australian wide role within a new unit called Corporate Finance, Recovery and Dispute ("CFRD"). While these developments were occurring, Mr Bastian had also noticed that there was a continuing expansion of Australian companies into South East and North Asia throughout 1995. He had formed the view that there would be a large demand for PriceWaterhouse's project finance business in these areas. He started to evaluate opportunities for PriceWaterhouse to win major projects in South East Asia and presented articles and gave speeches at seminars on behalf of PriceWaterhouse to market its global finance expertise. In furtherance of this role, in May 1996 Mr Bastian was responsible for preparing and publishing the second "Asian Infrastructure Barometer", a publication dealing with PriceWaterhouse infrastructure services as a global undertaking. That publication listed a number of contact points, including Mr Bastian for Sydney and Mr Poulter for London. In 1996, Mr Bastian also prepared a "PriceWaterhouse Project Finance and Infrastructure" article which described the global nature of the PriceWaterhouse business in which it was said: The PriceWaterhouse Project Finance and Infrastructure team has developed a reputation throughout Australasia and South East Asia as a key advisor in major areas such as: · road and railway transport; · electricity; · water and sewerage; · sporting and leisure facilities (including Olympics); · health services. Our project and infrastructure team operates in key financial centres in Australasia and South East Asia. We work closely with our London and Washington offices as well as accessing the global PriceWaterhouse network of 450 offices in 118 countries . 7 In his evidence Mr Poulter stated that the organisation of PriceWaterhouse was far from being "crystal clear". It is therefore necessary to set out the nature of the various entities in this case. Originally, the applicant commenced proceedings against PriceWaterhouseCoopers and PriceWaterhouseCoopers Project Advisory Pty Ltd. The then first respondent, PriceWaterhouseCoopers, in the Reply to Summons for Relief under s 106 (a document required by the provisions of Rule 18A to be filed by the respondent and which required the respondent to answer each of the matters raised in the application and to specify any additional matters of fact and law relied upon in opposition to the application) stated that the applicant was employed by the first respondent. Subsequently, and well into the timetable for the preparation for filing evidence in the matter, it became known to the first respondent that a service company, PriceWaterhouse Administration Pty Ltd was, in fact, the employer of the applicant. Amended replies were filed without leave and some considerable time later were objected to by the applicant. After interlocutory argument, the applicant was given leave to file an amended summons. Under the amended summons, the first respondent became the members of the partnership practising under the name of PriceWaterhouseCoopers in Australia. The second respondent was PriceWaterhouseCoopers Project Advisory Pty Ltd, a company incorporated in Singapore comprising of shares held by numerous PriceWaterhouse firms, including the Australian partnership. The third respondent, PriceWaterhouseCoopers Administration Pty Ltd was a service company which processed the payrolls for employees of the first respondent until 1998, and was, so the first respondent asserted, the employer of the applicant before his employment terminated in 1997 when he took up employment with the second respondent. The evidence in the proceedings disclosed the following matters: (a) the applicant was first engaged as a consultant by PriceWaterhouse Administration Pty Ltd in February 1993 and worked for the partnership in Sydney; (b) in July 1993, the applicant accepted an offer of employment in a position on the staff of PriceWaterhouse in the Sydney office. He was to join the Corporate Finance Section as an Associate Director with increments in addition to his base salary calculated on the net revenue for the "Australian Firm". The offer was on the letterhead of PriceWaterhouse and was signed by Ian Armstrong, Partner; (c) Mrs Thomas, the Head of Human Resources for the first respondent, gave evidence that the applicant was employed by PriceWaterhouse Administration Pty Ltd and that, after the merger with Coopers and Lybrand on 1 July 1998, the applicant was "transferred" to PriceWaterhouseCoopers Services Pty Ltd as were other staff; (d) the transfer of the applicant to PriceWaterhouseCoopers Ltd in July 1998 occurred a year after the applicant had taken up a position with the second respondent in Singapore; (e) Mr Watson, a partner in the first respondent since 1985, gave evidence that PriceWaterhouse Administration Pty Ltd was a service company for the partnership. The wages for employees of the partnership were paid by the service company. The applicant worked for the partners and was hired by them. The applicant generated income for the partners but he was not sure if any of this income went to the service company. All profits earned went to the partnership. The partners directed the work to be performed by the applicant and, if necessary, the discipline or termination of his employment would be decided by the partners. The partners decided if he would receive any bonus payments. (f) more generally, Mr Poulter gave evidence of the operation of the global network of PriceWaterhouse. He stated that there were a series of partnerships in territories, with territories agreeing to co-operate in many areas, e.g marketing. The territories "empower" a global management to appoint people to regions or global positions, for example, to develop new markets. 8 By 1996, Mr Bastian was in discussions with Mr Poulter about the development of a regional Asian based project finance team reflecting the type of work already performed by PriceWaterhouse in the UK, the USA and Sydney. Mr Poulter was also in discussions with partners of PriceWaterhouse, including the Australian partner Mr Watson, concerning this prospect. In due course, arrangements were made for Mr Bastian to attend a meeting in Singapore in June 1996, an involvement approved by Mr Watson, who also approved of the payment of Mr Bastian's airfare for the purpose of the meeting. The meeting in Singapore was conducted over approximately two days and Mr Poulter had prepared a project finance proposal for discussion. In that discussion Mr Poulter stated that a team should be established in Singapore to be the centre for advice on infrastructure for the region and would operate as part of a global PriceWaterhouse team. Mr Poulter also spoke about how clients could be obtained through the global PriceWaterhouse project finance capability - there would be conference speaking, international advertising and a clear presence in the global project financing brochure with the US, Europe and Australia. During this discussion, Mr Bastian recalls that Mr Poulter said that the team needed to be led by somebody capable of making executive decisions who should be a partner on secondment from one of the member firms for three years. As will become clear later, Mr Poulter had no recollection of speaking of secondment at this meeting and, in fact, said that he had a quite different view of the role: his proposal, however, did speak of secondees from PriceWaterhouse firms as being a possible source of expertise. There was a discussion as to how the team, operating as part of the PriceWaterhouse global finance network, would be established with Mr Poulter opting for a joint venture involving most of the firms with interests in Asia. If that option was followed it required a determination about who would be the shareholders in the joint venture. At the conclusion of the meeting, it was agreed that Mr Bastian would email recommendations for a report to Poulter which needed to be finalised before the Asian CFRD heads met in September 1996. 9 On 10 June 1996, Mr Pouter sent an email to Mr Bastian and others concerning this proposal, raising questions of whether or not the "world firm" should be approached and his need to disseminate the "Global Experience Data Base to get the US and Australia on board". The email attached a draft report, which had a proposal for the establishment of a team, which stated as follows: Team requirements . The minium start up team to research the market, present PW to clients and lead our first work in the region is four people in addition to the practice leaders. Roles and profiles would be as follows: AD (First) Secondee from elsewhere in PW, perhaps London. Banking expertise. Responsible for initial marketing and team building; then delivery. AD (Secondee) Recruit from Asian PFI market. Maybe local or foreign. Responsible for both marketing and delivering; but we will need the rest of the team in place to track him/her. Manager - preferably from elsewhere and PW, perhaps Australia. Infrastructure consulting or banking experience. Responsible for managing market research and then delivery. … Later in the report dealing with organisation within PW, the following was stated: Any team in Singapore will have to operate as part of a global PW team. It will depend on the rest of the network to feed international clients into the system; and even with the team proposed here, international resources will be needed for delivery in the first few years. A decision is needed on whether a business should be developed within the Singapore practice, with help provided informally by the UK, US and Australia, or as a joint venture. When Mr Bastian returned to Sydney he reported on these developments to Mr Watson. 10 By August 1996, Mr Poulter, assisted by Mr Bastian, had finalised a report which was to be submitted to the Asian heads at the CFRD meeting. That report repeated the earlier draft in recommending that the team should be led by a partner on secondment from one of the member firms for three years with assistant directors being secondees from elsewhere. The CFRD meeting approved in principle the concept of establishing Project Finance Asia. This was followed by discussion in March 1997, in which Mr Bastian was involved, dealing with the desirability of establishing a Memorandum of Understanding so that all participating PriceWaterhouse groups could understand what was their involvement in the project. Mr Poulter and Mr Bastian finalised the Memorandum of Understanding which was submitted to all the PriceWaterhouse firms who were to be the shareholders in Project Finance Asia. The Memorandum was agreed to in July 1997 and signed by all the shareholders in the practices of PriceWaterhouse in the region during 1997. 11 The Memorandum of Understanding recorded the participation of PriceWaterhouse firms including the firms in "Australasia". It provided that equity in the company would be owned by individual firms in specified shareholdings which involved eight particular firms including Australia, to the extent of 15 per cent. It was said that Australasia would represent through its shareholdings the interests of the PriceWaterhouse firm in Indonesia. The structure agreed was that there would be a central team incorporated as a company in Singapore. Project finance was defined in the memorandum as follows: Funding provided on a limited recourse basis for projects such as infrastructure schemes, usually (but not always) via a special purpose company and in combination with 'Build - Own - Operate' ("BOO") structures. 12 The memorandum stated that, geographically, the understanding covered all Project Finance Advisory work in Australia, China, Hong Kong, Indonesia, Korea, Malaysia, the Philippines, Singapore, Taiwan and Thailand. It was also to cover work arising from Project Finance Activity by clients from those territories, Europe and the US into Vietnam, Cambodia, Laos, Myanmar and India. The Memorandum of Understanding recognised that there would be costs in years one and two associated with building an enhanced capability for finance advisory work. The objective was to make a cumulative contribution and good margins by year three. As to the principles governing the Memorandum of Understanding, the following was stated: The main principle underlying the Signatories' Understanding is that they should work together to win and deliver project finance work on a regional basis. This relies on a spirit of trust and good faith, particularly on the following points: · In order to establish a project finance capability with the critical mass to market PW effectively and raise the firm's profile, a Central Team will be established, initially at one location in the region. · Recognising the importance of: a co-ordinated approach to the local markets - local contracts with potential clients; - involving locally based staff in the delivery of work; · the Central Team will discuss any plans for marketing or work in a Signatory firm's territory on a frequent basis and manage the work to provide proper involvement of local staff. · Recognising the importance of: - a consistent image in the regional market; - the market and business contacts of PriceWaterhouse within each territory; - a co-ordinated approach in the fee negotiations and delivery of work; - each signatory will discuss any opportunity which identifies with the Central Team, and, except for Japan, will allow the Central Team to play the leading role in all proposals, project management and delivery. In relation to the term of the Understanding it was stated: This understanding is long term. No withdrawal from the arrangements is envisaged. Any such withdrawal may not take place before the end of year three except with the agreement of the majority of the signatories. Any withdrawal must follow with at least a year's notice and must not be allowed to disrupt work in progress. The Memorandum concluded with the following statement: These arrangements provide the basis for PW to present itself as one entity in the Asian market for project finance, with a creditable and centrally managed capability to service clients on advisory work as well as a strong local presence in each territory. The co-operation will be carried out with this aim in mind. 13 Later in 1996, Mr Poulter spoke to Mr Bastian at his Sydney office about the discussion which had taken place at the CFRD meeting, and raised the issue of who would be the leader of the project in Asia. The meeting had apparently discussed a number of candidates including John Bastian. During the course of this discussion, Mr Poulter offered Mr Bastian the position as head of the Project Finance Asia Team and told him it would require him to relocate his family to Singapore. During this discussion, Mr Poulter said words to the effect: PriceWaterhouse is represented in over 100 countries and is constantly moving people but we have no standard terms and no formal process to arrange for international secondment. We will need to work out an arrangement which is satisfactory to you and meets the needs of your family. 14 In the course of considering the potential position in Singapore, Mr Bastian gave evidence that, in January 1997, he telephoned the head of Human Resources for PriceWaterhouse, Mrs Grace Thomas, and asked what exactly would be the terms of his secondment to Singapore. He gave evidence that Mrs Thomas informed him that he would be treated as an international "ex patriate on secondment from the Australian firm to the new entity". Mrs Thomas gave evidence denying this conversation. 15 Later, he was telephoned by Mr Poulter who suggested that, with the agreement to proceed with Project Finance Asia, Mr Bastian should go to Singapore, prepare a business plan for Project Finance and sort out housing for his family. Mr Bastian in evidence said that, while in Singapore in March 1997, apart from assisting in the preparation of the Memorandum of Understanding, he began preparation for the business plan for Project Finance Asia, and with his wife reviewed schools for their children, and accommodation. When he returned from this trip, he contacted Mr Poulter and informed him that he had looked at schools and housing and asked if everything was alright for them to go to Singapore. Mr Bastian's evidence was that Mr Poulter told him that he had to write up a business plan and submit it to Poulter so it could be sent out to all the PriceWaterhouse firms involved in the joint venture, and that there would need to be set up an new entity owned by the PriceWaterhouse practices. Because of that, it would be better for the future of the Asian project team if Mr Bastian transferred into the new entity in order that the Asian firms did not see him simply as an "Australian plant". Mr Bastian in addition stated that Mr Poulter said that the transfer was principally for the benefit of PriceWaterhouse, so that salary payments could come from the new entity in Singapore rather than to continue having his salary paid by Australia with reimbursement from the new entity. Mr Poulter denied having said anything about salary payments. 16 In May 1997, Mr Bastian prepared a business plan for the new entity and submitted it to Mr Poulter. The plan was then sent to PriceWaterhouse offices involved in Project Finance Asia. That document contained a section under the heading, "Background Worldwide Project Finance Strategy". Under this heading the following was stated: From the worldwide perspective of PriceWaterhouse, Project Finance is a key product offering CFRD service line. It is intended to roll it out globally in 1997 by providing further direction to the existing project finance practices and building an Asian finance practice, based on the Central Team and the local firms' capabilities. The PriceWaterhouse worldwide project finance strategy will then centre on around three principal hubs in London, Washington and Singapore, together with Sydney and emerging practices elsewhere . 17 While these discussions were occurring between Mr Bastian and Mr Poulter, there were other discussions taking place, to which Mr Bastian was not a party, the contents of which he was apparently not informed. Mr Poulter gave evidence that, around October 1996, he had a conversation with Mr Watson where he raised the issue of who should manage the Project Finance entity in Singapore, stating that there were only two realistic options, one of whom was Mr Bastian. Mr Watson is said to have replied that he did not believe that Mr Bastian was up to the job or capable of making it a success. He is said to have commented that there had been some problems with Mr Bastian in Sydney and that a partnership was certainly not on the cards for him. As a shareholder in PriceWaterhouse, Mr Watson said he had reservations about Mr Bastian for the job but invited Mr Poulter to talk Mr Bastian if he thought it was a good idea. It is of interest that in his affidavit Mr Watson made no mention of this conversation. 18 Mr Poulter said that he was well aware from discussions with Mr Watson that Mr Watson did not want Mr Bastian to return to Australia. He also recalled a telephone conversation around March 1997 with Mr Bastian and Mr Watson where Mr Poulter suggested that the position in Singapore, if set up as a secondment, would create problems in the region as the Asian firms may read this as some lack of commitment by the individual to the project. This approach was contradictory of the proposal submitted by Poulter which had senior staff on secondment. 19 In April 1997, Mr Bastian was contacted by Mr Poulter. Mr Bastian's evidence, which Mr Poulter did not deny, was that Poulter said the following to him: The negotiations for your secondment are to be handled by Allan (Watson). Australia has quite a few ex-patriates in Asia and they want to control the negotiations for your package in Singapore. As far as I see it, by taking the position in Singapore, you are in effect equivalent to a partner and you should get the type of package that a partner gets but you are still nevertheless an employee. For that reason, it is best that PW Australia look after the detail. 20 In his evidence Mr Poulter recalled that around April 1997 he had a telephone conversation with Mr Watson, where Watson told him that he did not want him to be responsible for negotiating the detailed terms and conditions of Mr Bastian and that he, Watson, would deal with those matters. It is of interest that Mr Watson's version of his discussion with Poulter was framed as a gentle request to take responsibility for negotiating the terms of Bastian's employment in the joint venture, whereas Mr Poulter's version of the conversation demonstrates Mr Watson to be much more assertive in taking control of these negotiations. Mr Bastian said that, in March 1997, Watson had raised with him the salary package for Singapore in order to get a feel for it although they were not yet at the point for negotiating the salary. Mr Bastian told him that his own enquiries indicated that a salary plus bonus in the range of A$250,000 to $300,000 was appropriate, depending upon the level of guaranteed bonus. 21 From late April into May 1997, Mr Bastian attempted to discuss his salary package with Mr Watson but he did not obtain an interview with Mr Watson until 23 May 1997. At that meeting Mr Watson read to him a list of salary conditions and told him that Singapore was a great opportunity for him which would enhance his career in PriceWaterhouse, ,but there would be no right to a position upon his return to Australia and that would be a pre-requisite for an assignment of this nature. Mr Bastian said that this was the first time he had ever heard of the suggestion that he would have no right to a position in Australia upon his return. This was something that concerned him and he expressed his concern in an email to Mr Watson dated 25 May 1997. 22 In his email of 25 May 1997 to Watson, Bastian set out the case as to why he was entitled to a higher rate. He also noted that now he had been advised that he would have no right of return to Australia, which would effectively terminate his employment with PriceWaterhouse Australia and therefore limit his career options. He said that this was a matter which was ignored in the calculations, and in his oral evidence he said that he was using this factor to try to increase the offer. Ultimately, the offer was not increased although Mr Watson says that the package offer took into account these facts. 23 What occurred next is of some significance. According to Mr Bastian's affidavit evidence, he had numerous conversations with Poulter between 23 May and 30 May 1997. He raised his concern about having no right of return to Australia after the Singapore appointment ended to which he recalls Mr Poulter replying: No matter what happens there will always be a position in PriceWaterhouse. I run the European project finance team and if there is not a suitable position in Australia at the end of your secondment in Singapore, I will find you one in Europe . Mr Poulter denies making any representations to the effect that Bastian would have a right to return to Australia because it was very clear from his own discussions with Watson that this was not the case and he in turn had made that clear to Bastian. He also denied that he would have a right to some other position in Europe or elsewhere in PriceWaterhouse. According to Poulter, he said to Bastian the following words: John, you have to stop trying to tie down the details of what will happen at the end of your contract. It is a fixed term contract. It may or may not be extended. However, like any job if you perform well in your role, there should be opportunities for you in the network at the end of the term. I cannot say more than that. 24 On 30 May, Mr Bastian said he had further discussion with Mr Watson about the Singapore appointment seeking a higher level of pay because he did not know if there was going to be anything for him in Australia when he finished in Singapore. According to Mr Bastian, Mr Watson replied: Look, although no right to a position here on return is a pre-requisite, it is put there primarily so that this deal can't be used as a precedent by other ex-pats. Following a stint overseas, PriceWaterhouse Australia will welcome you back with open arms. Just look at how well Mark Reading has done. He can write his own ticket to come back to Australia. 25 For his part, Mr Watson recalls several discussions. He had pointed out in May 1997 to Mr Bastian that he was not transferring to Singapore as a partner. He had also told Mr Bastian that the fact that his wife would have to give up her job and that the children would need to change schools were things he simply had to weigh up about going to Singapore - it was a difficult decision he had to make. In relation to Mr Bastian seeking a higher salary, given that there was no right to return to Australia, Mr Watson remembered saying to Mr Bastian: John, the offer is higher than what it would ordinarily be for precisely this reason. Let me put it this way. If you go to Singapore and you perform well, Poulter will want to find you a position somewhere in two years time. If you do not perform well, whether or not you have a right to return to Australia, your future with PWC will be limited. I therefore don't understand why you would not just take the extra money. As demonstrated by the evidence, the offer was not higher than it ordinarily should be - in fact it was known to be below the market. 26 Mr Bastian says it was as a result of encouragement and representations made by Mr Poulter and Mr Watson, as he understood them, that he was prepared to accept the position because, although the offer stated there was no guarantee of a position at the end of his appointment in Singapore, he believed that that clause had been inserted primarily so that it could not be used as a precedent by other ex-patriates who were appointed overseas. He believed the real position was that he was on secondment from PriceWaterhouse Australia to a new Singapore entity. 27 At this point, mention should be made of Mr Watson's affidavit evidence of a conversation he had with Mr Dall, the managing partner of PriceWaterhouse Australia, in March 1997. This conversation was part of extensive internal discussions about the remuneration package to be offered to Mr Bastian. Mr Watson said that Mr Dall became involved in the negotiations in Australia "as he was concerned that he did not want to set a precedent with regard to salary levels in Australia being transferred out of Australia overseas". Mr Watson recalled a conversation around 1997 when Mr Dall said the following: Allan, we need to be very careful here. If we pay John too much, he will be out of line with other Australians in Asia and this will cause us considerable difficulty. I do not, for example, want him to be paid at the same level as Derek Clark, who, as you know, is a partner in Singapore . 28 At the meeting with Mr Watson, Mr Bastian was handed a letter of offer in relation to the Singapore employment which was on PriceWaterhouse letterhead carrying the Kent Street, Sydney address and signed by Mr Watson as Managing Partner, Corporate Finance. The letter referred to numerous discussions concerning his possible employment with an entity to be established in Singapore by various PriceWaterhouse firms. The letter offered him the position of head of Project Finance reporting directly to Tony Poulter in London. The term of the position was two years commencing in July 1997 with an option to extend by mutual agreement. The offer then contained the following clause: There is no guarantee that the Australian firm will offer you a position at the end of your time in Singapore. For Australian Retirement Fund purposes, you will be placed on leave of absence during your employment in Singapore. The remuneration offered was a base salary of S$175,000 and a base bonus of S$50,000. The base bonus would be calculated and paid in accordance with an attached bonus metrics which had been developed by Mr Poulter. An additional bonus could be paid at the discretion of the "Singaporean entity". There were annual allowances paid for housing/utilities/telephones, for motor vehicle and for club memberships. There was also to be family medical and dental insurance, home leave in the sum of S$13,000 and school tuition fees to be paid. The home leave was to represent the cost of a single return trip to Australia for Mr Bastian and his family flying business class. Mr Bastian signed the letter of offer and, on the basis of the understandings he thought he had with Mr Watson and Mr Poulter, did not continue to press for a higher remuneration package. 29 It is of some interest that before Mr Watson had finalised the written offer made to Mr Bastian, he had received an email from Mr Poulter. The email, dated 27 May 1997, shows Mr Poulter's frustration at the haggling that was taking place over Mr Bastian's proposed package. The email was sent to Mr Watson, Mr Dall and Mr Browne of the Australian firm and noted that they were all at the end of their "tether" with this subject. Mr Poulter noted that they had agreed as a firm nine months ago that they needed a PW person to lead the team in Singapore and had also agreed that John Bastian was the only one available because the other prospective candidate would not be released from the US. It was noted that both Watson and Dall felt that Mr Bastian was not of sufficient calibre to give him a reward package similar to the Australian partners in Asia, but that Mr Bastian was not satisfied with what was being offered. It was also noted that after several weeks of discussion, the firm had nevertheless only just made one offer to Bastian the previous week. Mr Poulter said that they could reach the view that Mr Bastian's aspirations were not realistic, they could not bridge the gap between them and that they should call the whole thing off. He believed that would be the wrong approach because "However much it might get up our noses, John's aspirations are not unreasonable. We are effectively saying to him as a firm you are through in Australia - see what you can do in Singapore. Against that background, he legitimately expects some risk element in his package". Mr Poulter noted that his aspirations were some way below the market level for a good person and about half what would be paid for a "star". The comparison with Australian partners in Singapore was only partly relevant and that was because partners were in the game for long term equity in the firm, which was not being offered to Mr Bastian. Further, if Bastian was not sent to Singapore there was no one else to put in his place. There was no other internal candidate and an external candidate would be more expensive and would cost 33 per cent in head hunter's fees. They could not have such a person in place before October or January at the worst. The following was then stated: Having said all this, I do realise the sensitivity in Australia about agreeing a package with John which gives him an easy ride or an unfair position relative to other Australians. 30 Mr Poulter then proposed some solutions, but then noted that a number of things were held up while this disagreement continued. There was a brochure ready to go to the printers with Mr Bastian's name on it and they were sponsoring a conference in Singapore which Bastian should be attending and there were other marketing trips in Asia which were not being carried out and, further, Mr Bastian's name had already been put in proposals to two clients. Mr Poulter closed by saying: I do not see how the package I have suggested would cause problems with other Australians in the region. When you look at the job which John is being asked to do, the incentives he will have, and the market he will be operating in, it is perfectly justifiable. In oral evidence, Mr Poulter accepted that the package accepted by Mr Bastian was "well below market" value. 31 When Mr Bastian left Sydney to take up his Singapore appointment, central payroll at PriceWaterhouse was advised by Mrs Thomas that he was on leave of absence from PriceWaterhouse Australia from 1 July and would be transferring to another PriceWaterhouse entity based in Singapore for two years. She noted that his last day in the Sydney office would be 1 July 1997 and that annual leave accrued would be paid out upon commencing leave of absence. 32 Mr Bastian also gave evidence that a member of the HR department of PriceWaterhouse told him that premiums through his life assurance cover would be continued to be paid by PriceWaterhouse Australia. Although Mr Bastian named the person who made that statement, no evidence from that person was called to rebut its substance. However, Mr Watson gave evidence that, in May 1997, Mrs Thomas said to him that she understood Mr Bastian wanted to remain with the Australian Superannuation Fund because it could continue with his death and disability cover at a lower cost. She asked Mr Watson whether he could remain in the Australian Fund, to which Mr Watson is said to have replied that he did not see any problem with that so long as it did not impact on the fact that he had no right of return to Australia. 33 In his evidence, Mr Bastian said that he did not regard his appointment to Singapore as in any way affecting his long term accrued rights with PriceWaterhouse Australia; he did not believe that, by accepting the offer of 30 May from Mr Watson, he would not be entitled to any redundancy pay if, at the end of two years, PriceWaterhouse Australia did not find him a position when he returned to Sydney. At all times, he believed that he was on secondment, having been encouraged to go to Singapore. Moreover, he was not aware that he had been terminated from the employment of the first respondent; he did not sign any formal resignation letter, nor did he tender such a letter of resignation. There was no document in evidence from the first respondent which in clear terms told him that his employment was terminated. In Mr Bastian's recollection, the issue about life assurance occurred without any discussion with him and that he first became aware of the issue when he saw the contract of employment offered to him on 30 May 1997. He, in fact, remained a member of the first respondent's superannuation fund until the date of his termination on 2 July 1999. 34 Another matter which gave the applicant some comfort as to his continuing link with the Sydney office of the first respondent was that, while he was in Singapore, he regularly received emails from Mrs Thomas as the head of Human Resources which were addressed to "all Australian ex-pats", which kept them informed of various developments in the Australian firm. Other correspondence supported his view: he received a circular from the first respondent inviting nominations for the role of employee representative on the retirement fund; and he regularly received notices and information from the first respondent's Corporate Finance Administration Assistant relating to events and activities in Sydney. When he returned to Sydney he was always made welcome and felt a member of the team. 35 In September 1997, PriceWaterhouse produced a document entitled "PW in Asia". The document was directed to Pricewaterhouse partners and managers. This document spoke of the establishment of the joint venture and stated: The central joint venture team will operate out of Singapore, led by John Bastian, on secondment from PW in Sydney, and will be supported by Project Finance Professsionals from the UK, the US and Australia, as well as by external recruits. It was Mr Poulter's view that this document was written by Mr Bastian without being cleared with him. 36 It was not until late June 1997, (a month after Mr Bastian accepted his appointment), that a shelf company was purchased and that the participating PW firms, including the first respondent, subscribed to its share capital. This entity sponsored Mr Bastian's employment visa to Singapore. In September 1997, the entity changed its name to Pricwaterwaterhouse Project Advisory Pty Ltd, the second respondent. The Minutes of meetings of the joint venture held in December 1997 noted that the formalities for the formation of the company had largely been completed. It was stated that all shareholders who had signed the Memorandum of Understanding in July and August had subscribed the initial capital and first call. A second call was to be made with funds due in early December. The Minutes also noted that John Bastian became the first employee in July and had been joined by Raymond Bourdeaux, an associate director, on secondment from London since 1 October and by Chris Box, an executive on short term secondment from Melbourne/Jakarta since 1 October. 37 At the end of the first year of the contract, June 1998, Mr Bastian received a pay rise and a bonus of $40,000. The basis for this bonus, referred to as the "bonus metrics", was worked out between Mr Poulter and Mr Watson. Interestingly, when bonuses for the 1998/1999 year came up for consideration, Mr Poulter forwarded his views by email to Mr Bastian and to Mr Hagger, a partner of PriceWaterhouse Australia. BUSINESS IN SINGAPORE 38 When Mr Bastian arrived in Singapore, it became clear to him that he would need a motor vehicle for his work and to transport his family. Motor vehicles were very costly, however, and involved purchasing a certificate of entitlement at a cost of approximately S$60,000 which was valid for ten years. These certificates of entitlement could transfer with the vehicle. At first Mr Bastian used taxis and then made enquiries about leasing or purchasing a vehicle. In this area, he was helped by representatives of the second respondent who were connected with PriceWaterhouse Singapore. He initially rented a vehicle at the cost of S$1950 per month which was provided through his S$2,000 per month motor vehicle allowance. 39 He decided he needed to purchase a vehicle and was advised that he should buy a second hand family wagon approximately three years old which would involve a depreciation of approximately S$6,000 per year. Mr Bastian ultimately purchased a wagon which could not be financed from Singapore financial institutions. He had made enquiries of PriceWaterhouse Singapore to see if they could provide a car but was told that was not available because he was not an employee of PriceWaterhouse Singapore. He raised the matter with Mr Poulter, who subsequently directed that he would obtain a loan from the second respondent in order to purchase the car. Poulter told him he would have to pay interest on the loan funds which would be calculated at 6.5 per cent and the amount would be withheld from his motor vehicle allowance. Following this direction, Mr Bastian was able to purchase a motor vehicle for S$114,500 which was paid by the second respondent on his behalf. The interest charged by the second respondent was S$7,440 per annum, a figure that was deducted from his monthly vehicle allowance. During his appointment in Singapore, he paid all costs associated with the vehicle including annual road tax, insurance, servicing costs, petrol, CBD entrance fees and parking charges. BEING PART OF THE GLOBAL NETWORK 40 Mr Bastian described PriceWaterhouse as an international firm of accountants and advisors, that it was a series of geographically based partnerships that collectively constituted the worldwide firm of PriceWaterhouse. This was the position when he accepted the appointment in Singapore in the middle of 1997. As he saw it, this arrangement allowed the transfer of information, the international service of clients and secondment of staff. PriceWaterhouse encouraged its clients to think they were a part of an international firm although they were a series of legally independent offices. Its publications emphasised that PriceWaterhouse could offer international expertise delivered locally. There were examples of such advertisements listing the names of the contact people in the United States, Europe and naming Mr Bastian as the Asian contact. Just before Project Finance Asia commenced, PriceWaterhouse published a document entitled "Project Finance" showing the first respondent and the second respondent to be part of the PriceWaterhouse global project finance network. Again, Mr Bastian was named as the Asian director and a Mr Russell of Melbourne was named as an Australian contact. 41 Mr Bastian saw it as part of his role to attempt to not only generate work for PriceWaterhouse globally but also for the first respondent. This approach is supported by the terms of the Memorandum of Understanding. In taking this view, he was motivated by his desire to enhance his partnership prospects upon his return to Australia. As part of this approach, on the four out of five occasions he returned to Sydney between October 1997 and December 1998, he attended the Sydney office of the first respondent and met with staff and partners and up-dated them with briefings on deals, discussions, projects and market strategy. He said that he also met with clients, both of the first respondent and the second respondent, in Sydney during these visits using the facilities of the first respondent's Sydney office. There were also marketing meetings with clients and targets of both the first and second respondents. He gave a number of examples of those meetings, although Mr Poulter seemed to be unaware of this involvement. Interestingly, Mr Watson made no mention of these matters whatsoever in his evidence. Mr Bastian said he provided certain material, including commentary and assessment on the Asian crisis and other specific industry advice which he believed, by contact with Australian members of the firm, was used in the Australian business. 42 The joint venture in Singapore, however, met with only modest success. Shortly after its establishment, the Asian economic crisis had its effect and the planned two year period to become established and exceeding a break-even point appeared to be optimistic. There was a good deal of evidence, which was strongly contested by Mr Bastian, as to his responsibility for the lack of immediate success of the joint venture, but the evidence does not allow any firm conclusion to be reached about those matters. In fairness it should be stated, however, that Mr Poulter accepted that the pay rise he authorised for Mr Bastian at the end of the first year reflected Bastian's satisfactory performance - in fact it could reflect a "good" performance. Mr Bastian was also paid a bonus for that year. Further, Mr Poulter said in August 1998 that he welcomed the news that Bastian was prepared to stay in Singapore for another year after the two year term expired. It should also be recorded that Mr Poulter in his oral evidence stated he regarded the joint venture in Singapore as a "centre of excellence" and that in November 1998 it was not meaningful to look at the profit and loss accounts in assessing the joint venture. THE ATHENS OLYMPICS PROJECT 43 In August 1997, Athens had been selected as the host city for the 2004 Olympic Games. During the first half of 1998, the Athens organising committee announced an international tender for the appointment of an International Financial Advisor. Mr Bastian was contacted by a senior manager of PriceWaterhouse in Athens who were preparing an expression of interest for the role of international financial advisor, and requested Mr Bastian's help. He was told that contact had been made with the Sydney office and the partners there had told him that Bastian was the firm's expert on the Olympics. Mr Poulter claimed responsibility for this contact, saying that he had been contacted by the Athens firm and had suggested that they contact John Bastian in Singapore as being a good person to be involved in the project as he had worked quite extensively on the Sydney project. 44 In September 1998, PriceWaterhouse and two others were short listed for the international tender. In late September or early October 1998, Mr Bastian was again contacted by a senior member of PriceWaterhouse Athens who told him that the Chairman of the Athens firm wanted Bastian to help prepare the bid because of his knowledge of the Olympics. He was asked to come to Athens to help. Mr Bastian was prepared to assist provided that Mr Poulter approved because so much time would be involved. Shortly after, Mr Poulter telephoned him and recommended that Mr Bastian go to Athens to assist in the preparation of the proposal. He was first required to go to London and meet with Mr Poulter before going to Athens. 45 When he arrived in Athens, Mr Bastian found that little preparatory work had been done in relation to the bid documents and it appeared to him that the Athens office was relying totally upon him to prepare all aspects of the bid. He remained in Athens for approximately two weeks working exclusively on the bid documentation. The Athens office then asked him to be involved in the presentation of the bid and, ultimately, he was nominated to be the project director. In November 1998, Mr Poulter telephoned him to ask him how he felt being nominated as the project director and undertaking such a role in Athens. Mr Bastian replied that he wanted to wait and see what happened because he did not want to live with uncertainty as to where he and his family would live and where the job would be. 46 In late November 1998, a senior member of PriceWaterhouse Athens contacted Mr Bastian and told him that the firm was to present its bid to the Organising Committee and they needed his attendance: he was told his involvement was so important that without it their bid would fail. Later, Mr Poulter telephoned him and told him he needed to be there and that Poulter would also attend. Mr Bastian arrived at Athens from Hong Kong on 1 December, attended at the PriceWaterhouse Athens office and prepared slides for the presentation. The slides were refined with Mr Poulter and the presentation occurred on the afternoon of 2 December. At the presentation, Mr Bastian gave evidence that the Chief Executive Officer of Athens 2004 (the Organising Committee), Mr Bakouris, said to him words to the following effect: Mr Bastian, you are very important to PriceWaterhouse delivering this work. What commitment will we have of your time? Before Bastian could answer, a senior member of PriceWaterhouse Athens said words to the effect: Mr Bastian is moving to Athens with his family. 47 This conversation, and the apparent enthusiasm of the PriceWaterhouse Athens office for Mr Bastian's participation in the Athens Olympics should they become the financial advisors to the Games, was not shared by Mr Poulter. Mr Poulter did not deny these conversations took place, but in his affidavit he said he was "very disappointed" about Bastian's work on the project. He accepted that Bastian was enthusiastic and industrious but his work was "disorganised and lacking in meaningful technical content". He said that, together with two members of the finance project team in London, they had to rewrite many parts of the proposal. It is somewhat surprising then that an important contract like the Athens Olympics would have been left in the hands of a person of doubted ability. Mr Bastian's involvement in this project suggests that his performance up to November 1997 was, at least, acceptable. 48 On 8 December 1998, PriceWaterhouse was officially appointed as the Financial Advisor to the Athens Games. Mr Bastian recalls receiving a telephone call from Mr Pouter informing him of the success in being appointed to the Athens role and saying how important it was for PriceWaterhouse. He noted that Bastian had been nominated as the Project Director and told him he now needed to think through his future - whether he wanted to deliver the project. Mr Bastian was at the time at his father's funeral in Sydney and told Mr Poulter that he would think it over and, when he got back to Singapore in the New Year, he would let him know of his intentions. Mr Poulter did not contest the accuracy of this account. 49 Following the firm's success in winning the Athens Games' tender, Mr Bastian received widespread congratulations and praise, including from partners in the Australian firm, the first respondent. On 24 December 1998, Mr Andrew Hagger, who was a partner with the first respondent, issued a bulletin to various PriceWaterhouse entities in Australia, Asia, Japan, London and Europe commenting on recent successes, which included the following: GREAT WINS SINCE THE CONFERENCE Most of the reward for the hard work in the last two months will be seen in 1999 but already we're seeing some wins: John Bastian had an absolutely tremendous win as a key player in PwC's multi national win to be lead advisor for a $500 million project financing for the Athens 2004 Olympics (with Morgan Stanley "sub-consulting"! - look how far we've come!). John flew to Athens just before the Bangkok conference to get the proposal process under way, and utilised Tony Coleman's actuarial skills in pricing the proposal while he was in Bangkok, then flew to Athens in early December for the final presentation. It's a $3-4 million win for the firm, and a personal triumph for John who has a great Olympic CV and will play a leading role in the project delivery. 50 In January 1999, Mr Ray Renelli, described by Mr Bastian as the worldwide leader of the CFRD business, which was then known as the Financial Advisory Services, released an announcement to all Pricwaterhouse employees, throughout the world, of the Athens win. In that document Mr Renelli stated: As well as the Athens based team of Matthew Troulis and Spiros Tarazis, this meant bringing together John Bastian, based in Singapore but whose expertise gained from work on the Sydney 2000 Games was key and who will now considered re-locating to Athens, and Simon Penney. Congratulations and thanks are due to the people from all Lines of Service who contributed knowledge from the work of Barcelona, Atlanta and Sydney and to Max Goodman in Athens for his help on the proposal. This was a fantastic PwC effort - demonstrating the power of our combined specialist industry expertise, the quality of our extensive global network and the ability of our people to work together across borders and across of Lines of Service to win the highest profile assignment. Mr Bastian also gave evidence of a congratulatory telephone call from a partner in the European financing team of the firm who also mentioned that Mr Poulter was very happy with him. Mr Poulter denied that he had made such a statement to the European partner. 51 In February 1999, Mr Bastian said this project won the PriceWaterhouseCoopers win of the year, although he did not elaborate as to what that meant for him or what was involved. 52 Despite the obvious importance of the Athens win for PriceWaterhouse globally, Mr Bastian did not receive any bonus in relation to that project. He was not paid any bonus for his second year in Singapore although he had received a bonus for the year 1997 and every other year of his service. Mr Bastian calculated that, if he had been paid a bonus for his role in his Athens success, based upon the bonus structure with the first respondent, he would have received five per cent of the net revenue generated, that is, between S$150,000 and S$200,000. No bonuses were paid to anyone in the Singapore office for the 1998/1999 year. A TRANSFER TO ATHENS 53 On returning to Singapore, Mr Bastian sent Mr Poulter an email on 4 January 1999 confirming his interest in taking a position in Athens. A copy of that email was sent to Mr Hagger (an Australian partner in the first respondent) working with the joint venture. In this email, Mr Bastian discussed his future with PriceWaterhouse and referred to a number of possible options, including taking on a role in Project Finance in Australia. He pointed out that there needed to be some consideration of his future because he was again moving to get the necessary runs on the board from a particular activity, a matter mentioned previously by Mr Poulter as an impediment to him becoming a partner. He regarded the joint venture in Asia as being able to reach its necessary success status during 1999 but pointed out that, if he moved to Athens, he would not be in Asia to receive the accolades of that achievement and he also expressed his concern that Athens would move him "another step from the Australian practice and further into no-man's land". He then asked: "How do we manage tracking my career in these circumstances. Are you, Tony and Andrew, in a strong enough position to support me in Australia? Europe? or where for the current year?" He also pointed out that a return to Sydney was a clear long term goal, but especially in relation to personal aspects of his children's education, but also addressing the PriceWaterhouse aspects as well - "to return not a partner would have serious negative connotations". Mr Bastian finished the email in the following way: Tony, having re-read this note, I see that there are three main points: 1. Let's scope the Athens 2004 role fully before making any decisions. 2. Moving to Australia has major career aspects that need to be resolved before moving there. 3. Let's use this to build an Olympic's industry role. 54 There seem to have been a number of discussions about Mr Bastian's future towards the end of December 1998 and January 1999. Mr Poulter recalls a regional meeting in Bangkok in December 1998 where, together with Mr Hagger, they spoke to Mr Bastian about the unlikelihood of his contract for Singapore being renewed, partly because of the economic situation and partly because of his performance. Mr Bastian recalled conversations to a similar effect over a period of time, but denied that there had been any suggestion that his performance was not up to scratch as suggested by Poulter. Mr Hagger also recalls a conversation in Bangkok in November 1998 with Mr Bastian where a view was expressed that he was not happy with Bastian's performance. Mr Hagger said that he had spoken with some of the leaders and the feedback was that they were not too happy. Bastian is said to have replied that he should not be used as a scapegoat for the joint venture's problems. Mr Bastian for his part denied that Hagger raised any such allegations about his performance nor did he provide any written statements about his work performance. 55 Mr Poulter said that, around 13 January 1999, he had a telephone conversation with Mr Bastian where he was told that the contract in Singapore was coming to an end and would not be renewed, a possibility mentioned when they met in Bangkok. He then spoke about whether or not an agreement could be reached for him to work on the Athens project, that there was an issue about whether it would take all of his time. There could be a discussion as to how to occupy his time other than on Athens but, in honesty, he had to inform Bastian that he did not have partnership prospects. He could be proved wrong, however, if Bastian performed beyond Poulter's current expectations, but at this stage Poulter did not believe that he had the management or technical capabilities. The end of February was set as a target for arriving at agreement for him to go to Greece. He also told Bastian to consider what happens if agreement was not reached. 56 Mr Bastian's recollection was that, in this January meeting, Mr Poulter had said to him that, as he was moving to Athens, then, clearly, the Singapore contract would not be renewed but there would be a new contract for Athens. Mr Poulter denies such a conversation. Both Bastian and Poulter agreed that Poulter send an email to Bastian with a copy to Hagger recording the points that they had covered in their discussion. Copies of this email were annexed to affidavits sworn by both Mr Bastian and Mr Poulter. In that email, Mr Poulter confirmed that Mr Bastian would stay resident in Singapore until 30 June 1999. The contract in Singapore would not be extended after that time but the Olympic job would require him to work 50 per cent of his time in Athens. There was then a discussion about how he would spend that time, either pursuing other work in Greece or developing other Olympic work. The document confirms Mr Poulter informing Mr Bastian that, in his view, Mr Bastian did not have partnership prospects. He proffered the view they should not dwell on partnership prospects for the immediate future, but that decisions on how "we manage your career need to take that into account". There were to be discussions with other members of the firm as to the economic basis on which the Singapore joint venture could make money out of the fees accruing from the Olympic job and how he would make a profit on his personal costs and, in the meantime, Mr Poulter would enter into discussions with others in the firm as to what sort of contract "we could have for you in Greece that was fair to you and your family and economic for the firm". It records an agreement for the immediate future: Mr Bastian would go to Greece on 1 February to begin work on the job and to carry out "some reconnaissance into possible skills and accommodation"; he was to be sent information by fax on cost of living and possible salary levels to help him with his decision. It discussed the possible option of him and his wife relocating to Greece but the children boarding in Australia. The email then spoke of the risk that, if no agreement could be reached after 30 June on contractual arrangements, Mr Bastian would need to think about other employment. Both agreed that was hoped to be avoided. Mr Poulter said that they agreed that Mr Bastian would speak to "Andrew" (Hagger) about what he should do before phasing into the Athens project from 1 February. They wanted his time to be used efficiently for the benefit of the business, although it was recognised that business development in Asia probably did not make a lot of sense at the moment unless it was carefully focussed. He was told that his main focus must be on "getting up and running on an economic basis on the Athens project". The email concluded on the following note: And once again - well done on the win! Kind regards, Tony. This comment did not reflect Poulter's "disappointment" at Bastian's work on the project to that time. 57 Mr Bastian's evidence was that the discussion with Poulter about not extending his contract in Singapore was in the context of him taking a position in Athens. Towards the end of January 1999, Mr Bastian emailed Poulter attempting to finalise his employment in Athens. On the same day Poulter telephoned him and directed him to consult a person from the HR division of PriceWaterhouse London who was responsible for "ex-patriate transfers and secondments", and also to speak with a senior person in PriceWaterhouse Athens. In the course of this discussion, Poulter said: It is up to PriceWaterhouse to make you an offer. It is in our hands. Mr Poulter agreed that this conversation took place. 58 Between January and April 1999, Mr Bastian flew to Athens on three occasions. He met and consulted with various employees of PriceWaterhouse Athens and also sub-contractors. He organised the set up of the offices within the Athens 2004 Organising Committee and continued to work on the project. He was asked to and did prepare ad hoc reports on Athens, advising on how to involve the private sector to fund projects in a similar way to what had occurred in Sydney. He refined the work plan and future staff involvement for the project and raised issues of fee structure for the operation of the office. One particular matter involved him preparing a detailed portfolio to be used at the Athens 2004 International Property Development Convention held in Cannes in February 1999, designed to encourage investment in the development of Athens 2004. His portfolio was the Olympic investment opportunities portfolio. Mr Poulter agreed that Mr Bastian was involved in these tasks during this three month period. 59 On more than five occasions between February and April 1999, Mr Bastian spoke to the London contact nominated by Mr Poulter. Mr Bastian was attempting to settle the terms of his move to Athens but was fobbed off with excuses that people were having difficulty getting to Mr Poulter or waiting for feedback from him. In February, he was given two local HR contacts in Athens. Also in February, the Athens firm had organised for assistance for Mr Bastian's wife when she came to Athens to look at a number of schools and houses and generally to show her around. Mr Bastian and his wife flew to Athens in February 1999 for approximately ten days to look at schools and housing for the family. 60 The costs associated with this travel were initially paid for by the second respondent who sought reimbursement from the Athens firm. Bastian was later informed that the Athens firm would not reimburse these costs. Poulter then told him that approval for interim expenditure on hotels and relocation agents was to be approved by Poulter or the London contact because Poulter did not think it was reasonable to charge these matters to the 2004 job or expect the Greek firm to meet the costs directly. This information was contained in an email to Mr Bastian and also raised a number of other points: Poulter pointed out that Bastian would not have to negotiate twice about the Athens terms because Poulter would be responsible for "agreeing things"; he assumed that Bastian would come on to the London payroll under any new contract or that London would take the costs risk associated with the employment; after this week of inspections of housing and schools, he hoped Bastian would make a decision in principle quite soon about whether his family would move with him and, if so, for how long because this was a key issue for structuring his arrangements and working out the economics for the firm. Mr Bastian was given advice about Greek property rentals and why he should avoid being shown properties beyond the range advised by the Greek firm. It was also agreed that the arrangements should be wrapped up within four weeks "for the good of all concerned". Mr Poulter told him he was trying to get into a position so that the firm could decide what to offer him and he could decide what to do. 61 Although Poulter had said he was available to Bastian for discussions during this period for as long as was needed, there was no reply to two emails sent by Bastian on 15 and 23 March requesting a copy of the draft contract for Athens. Mr Bastian emphasised he would need some time to review and consider the offer before it was discussed and they had agreed that this should be wrapped up by the end of March. There was no reply to these urgings from Mr Bastian except that, on 19 April, Mr Poulter sent a document to a number of the PriceWaterhouse entities and also to Mr Bastian dealing with the Athens project. It discussed a number of matters under the heading of Strategy and Positioning, Key Objectives etc, and laid down goals and matters to be dealt with. In this document, there were matters directed for Mr Bastian's attention. Mr Bastian asserted that a number of the issues raised were directly concerned with his role at the time. Mr Bastian also made the point that, during this period, he was spending a lot of time on the Athens project and, by necessity therefore, not dealing with work to the same extent in Singapore. 62 At around this time, Mr Bastian continued to work on the Athens project and his family started to finalise their personal affairs in preparation for their departure from Singapore to take up their new life in Athens. On 27 April, however, Mr Bastian received a telephone call from Poulter's secretary saying that Mr Poulter wanted to speak to him in relation to his transfer to Athens. Several arrangements were made to receive that call but it was progressively postponed until about 11.00 pm that night when Mr Bastian telephoned Poulter who told him he would call him back shortly. When Poulter did call back Mr Bastian recalls that he said words to the following effect: I wish to advise you that your contract of employment with PriceWaterhouse Project Advisory Pty Ltd will terminate on July 2, 1999 and will not be renewed and you will not be transferring to Athens and with the knowledge of the Australia firm I cannot offer you another position in Australia, Europe or elsewhere. I will now email a letter to you. 63 Mr Poulter's evidence was that, during April, he had a growing concern about the progress being made by Mr Bastian and the way he was managing the team. On several occasions during April he spoke with senior members of the Athens firm and also with Mr Hagger. He also discussed options and had a discussion with Hagger in which he said that Mr Bastian was not doing well on the Athens project. He told Hagger that he had come to the conclusion that it was a mistake considering assigning Bastian into a senior role in the project notwithstanding his Olympic experience and that, unfortunately, it was not economically viable to involve him in any capacity other than in a senior capacity if it meant relocating or a lot of travel. He had come to the view that he needed to remove Bastian from the project and sought Hagger's view. According to Poulter, Hagger said that he agreed that removing Bastian from the job was the only practicable option and that, unfortunately, when his contract expired it seemed that there would be nothing left for him. In his affidavit evidence, Mr Hagger does not mention this conversation. Importantly, there is no explanation of why Mr Hagger was being consulted about Mr Bastian's appointment to Athens. Mr Hagger was an Australian partner, seconded to Jakarta for three years and involved in the Singapore joint venture. 64 In his affidavit evidence, Mr Poulter said that, around early to mid-April, he had a conversation with Mr Bastian about the Athens project. In that conversation, he said he expressed his concern that the staffing was not right to deliver the job and he wanted to discuss with Mr Bastian the possibility of him having a lesser role in the project. Poulter also said that he was not sure, at this stage, if "we would ever be able to agree transfers with you", to which Bastian is said to have replied, "I think the terms I am looking for are reasonable". This conversation is denied by Mr Bastian. 65 After a number of attempts to receive the letter concerning the termination of his employment, Mr Bastian finally received a document about 4.30 am Singapore time. The letter noted, on behalf of the second respondent and with the knowledge of the Australian firm what had been said concerning the matter he had discussed with him on 12 January, that his contract in Singapore would terminate on 2 July and would not be renewed. That decision reflected the unavailability of a role for him after that date. It was said that, after careful consideration, "we do not believe you are the right person to direct" the Athens work and "we can see no other position for you in the firm in Europe, Singapore or Australia that would be suitable for your experience". Arrangements were made for paying his salary to June. It was proposed to pay him, on an ex-gratia basis, the equivalent of an additional seven to nine weeks' salary on the understanding that there would be no obligation for the firm to pay such an amount but in recognition of the non-renewal of his contract. There were several mentions of "the firm" dealing with withholding tax and paying reasonable costs for his repatriation to Australia. The letter then contained this paragaph: I have informed George Leventis at Athens 2004 that you are being replaced as Project Director on the Olympics work with immediate effect. The only people who are aware of the decision not to review (sic) your employment contract are Georgia Mourla, Andrew Hagger, Nicky Tan, Allan Watson and the relevant personnel functions in Europe, Singapore and Australia. I would like to discuss with you how to communicate your position within the firm and to clients because we have no wish to cause you difficulty in finding alterative employment: quite the opposite. 66 Mr Bastian said that his termination came as a complete surprise to him and that he had expected that the telephone call was about the terms of his appointment to Athens. An appointment to Athens was consistent with everything that was happening in this period of time, including the nature of the work and the documents being sent to him from Mr Poulter and the firm. 67 On 29 April 1999, Mr Bastian met with Mr Hagger, as he describes it and which was not disputed, "of the first respondent" at the Ritz Carlton Hotel in Singapore. At that meeting, Mr Bastian informed Hagger that the financial offer was inadequate. Mr Hagger took notes of the meeting which indicated at one stage that apparently Mr Bastian raised the possibility that he could be out of work for one or two years and that he was seeking "what is fair in his circumstances". Much of Mr Hagger's notes appears to deal with transitional arrangements and how to handle the announcement of the termination of Mr Bastian's employment. Apparently after this meeting, there was a telephone conference call between Hagger and Bastian in Singapore and Poulter. Mr Bastian said he asked Poulter in this call whether his salary was going to be continued to be paid, to which he recalls Poulter saying, "We will continue to pay your salary until 2 July 1999". Mr Hagger denies that in this telephone call Poulter said anything about continuing to pay salary until 2 July, although that appears to be the clear effect of the letter of termination sent to Bastian by Poulter. Mr Poulter, in his affidavit evidence, does not challenge what Mr Bastian says about this conversation. This conversation has some significance because Mr Bastian's evidence was that, for May and June, the second respondent withheld his salary thereby placing him in great personal financial stress. 68 On 4 May 1999, Mr Bastian wrote to Poulter. In that letter, Mr Bastian rejected the proposed financial offer as being inadequate arising from the discontinuance of his services in PriceWaterhouse. He expressed his concern about his children and the financial stress being placed on his family. He drew attention to the fact that he was about to turn 45 and was now in "the next age bracket" when looking for employment. He recorded that he had been advised by executive search professionals and other people with experience in the field that he could reasonably expect to take 12 - 24 months to find full time employment. The finance industry in Asia, for example, had been through a significant contraction over the past two years and there were a lot of people like him, with similar skills to his, currently in the job market. He also referred to leaving PriceWaterhouse under "somewhat of a cloud" and that that may create concerns in a future employer. He pointed out that the decision to terminate him had been made in late April, just months before the time in which bonuses would be paid. He asked for recognition for the work he had done in Project Finance Asia and the role he had played winning the Athens 2004 assignment. He spelt out his personal position and disruption to his children's schooling and that his wife had given up work to come with the family to Singapore. Thus, there was no income to fall back upon. He raised the fact that other employees and partners in PriceWaterhouse had been provided with funded retirement plans but that had not been so in his case, and he emphasised his concern that the decision to terminate him should not impact on that level of retirement savings that he had been able personally to implement. He spoke about being "sick with worry", and his concerns for his children and family. He asked for an appropriate settlement in Australian dollars. 69 Mr Hagger gave evidence of a further meeting with Bastian on 20 May in Singapore. He made a record of that meeting and forwarded it to Tony Poulter, Grace Thomas and Allan Watson in Australia as well as Nicky Tan in Asia. At that meeting, Mr Hagger said that there had been a discussion with Poulter and himself and the ex-gratia payment proposed in previous correspondence had been further evaluated but would not be increased. He records that Mr Bastian asked: "What is the question you have asked when soliciting what is fair? Have you asked what is reasonable for a retrenchment from the Australia firm in circumstances where a secondee is stranded in a foreign country?". Hagger told him that "our position" was that he was not being retrenched and that he was not an Australian employee, that he was simply on a two year contract ending on 2 July 1999 and that he had under performed, and it was their entitlement not to renew his contract. Hagger apparently told him that his route back to the firm in Australia "had been shut (at least non-guaranteed) to him two years ago". While there had been an expectation that an Athens contract would materialise and was previously under negotiation, Bastian's under performance in the early part of the Athens engagement had led to the situation where it was decided he should be removed from the team and that no contract would be forthcoming. 70 Hagger then discussed the separation agreement that was proposed which tied the payment of benefits to an agreement of confidentiality, non-solicitation and an agreement not to seek any further payments or amounts in any claims against all of PriceWaterhouse. He was told he would be given an ex gratia payment, the provision of their out placement services and the provision of two discounted economy air fares to Australia between May and July. Bastian told him that he felt it was blackmail: he said he was being asked to acknowledge that he was not under duress when he clearly was. Hagger said that it was the standard practice in Singapore to withhold the May salary, being the current period, once it had been known that the contract would be terminated. Hagger told him that he had no recollection of any promise that he would be paid salary for this period, at which point Bastian became quite angry because he had already drawn cheques on the basis of the salary being paid. Bastian spoke of being humiliated. 71 Mr Poulter recalled that, a few days after the telephone call of 29 April, Bastian had called him again and said he would be grateful if he could see if there were any opportunities in Europe or anywhere else for him. Poulter replied that he had already considered whether there were other positions for Bastian and had concluded that there was nothing. 72 On 22 May 1999, Mr Bastian wrote to Hagger and Poulter and referred to the meeting of 20 May with Hagger. He recorded that the firm wished him to sign an agreement and that, until such time as he did sign the agreement, it would withhold his normal pay and other unspecified payments and benefits. He said that he was embarrassed financially and was in financial difficulties. He could not give consideration to the document and terms of the proposed agreement because he did not have it. He asked them to put in writing precisely what the firm intended to do and what was expected of him. He concluded the letter in the following way: In relation to the comments Andrew made during the meeting alleging under performance, these are an irrelevant consideration and do not bear up to the reality and the successful role that I have undertaken. 73 On 23 May, there was another telephone conversation between Hagger and Mr Bastian. In that conversation, Mr Hagger said the withholding of salary had nothing to do with the separation agreement and that it was simply a standard practice of withholding for tax purposes prior to departure from Singapore. 74 Mr Bastian said that when he returned to Australia, beside many family and personal problems, he was very anxious to secure employment and therefore decided to take the first available job he was offered. He said he would have preferred to wait and see what other jobs were available, but he was not financially in a position to do so. 75 Mr Bastian's difficulties with the firm did not cease on his return to Australia. On 17 November 1999, the second respondent filed proceedings in the District Court of New South Wales claiming the full amount of the car loan which had been made to him, plus interest and costs. Mr Bastian's experience was that those matters did not require immediate repayment but would be part of negotiations for termination. These had not been finalised and on that basis he defended the District Court proceedings. He sought a stay of those proceedings pending the determination of the proceedings in this Court, but the second respondent refused to consent to a stay and the District court refused to stay the proceedings. On 6 October 2000, the case was heard and a judgment was entered in the sum of $137,591 including interest for 2 July 1999. He was also ordered to pay the costs of the proceedings. In November 2000 Mr Bastian paid the second respondent the sum of $137,591. SUBMISSIONS 76 For the applicant, it was put that his case was quite simple - his contract with the first respondent was unfair insofar as it failed to treat him as being on secondment to the second respondent, or in some way treat his absence as a leave of absence maintaining his continuity of employment. If that approach had been adopted, the applicant would have been entitled to a reasonable termination payment. 77 The first, second and third respondents were part of a global PriceWaterhouse network comprising 450 offices in 118 countries. The inter-connection between the various international offices was found in a number of PriceWaterhouse publications and they spoke of the market for Project Finance advice being "global". In setting up the second respondent, it was clear from the earliest time it was to operate as part of a global PriceWaterhouse team. That is precisely how Mr Poulter had described the Joint Venture in the initial document canvassing support for the concept. The second respondent was a joint venture between PriceWaterhouse practices - again, precisely as described by Mr Poulter in the initial documentation. Part of the aim was for the PriceWaterhouse worldwide Project Finance Strategy to centre on three principal hubs in London, Washington and Singapore together with Sydney and emerging practices elsewhere. 78 It was submitted that the applicant was not transferring out of PriceWaterhouse. He had been asked to head up a joint venture in which his then employer, PriceWaterhouse Australia, was a partner. The Australian firm was as vitally interested as anyone in establishing and having the successful operation of the proposed joint venture. The applicant was asked by the PriceWaterhouse group to transfer to Singapore and did so with the Australian firm's consent. Further, the first respondent negotiated the terms of his appointment and did so on a basis to protect their own interest in packages for Australian firm employees working in Asia. None of this was consistent with the termination of Mr Bastian's employment. The Australian firm's involvement continued throughout Mr Bastian's term in Singapore and it was involved in the termination negotiations, especially in relation to the separation agreement. 79 The Agreement of 30 May 1997 was not consistent with termination. The provisions that there would be no guarantee that the Australian firm would offer Mr Bastian a position at the end of his period in Singapore were equated with an employer telling its employee that there was no guarantee that he would have the same job in two years' time. That was not surprising and rarely would it be expected that such guarantees would be given. 80 The applicant always thought, and was entitled to think, that he was on secondment while working in Singapore. This belief was brought about by reference to his position being one of secondment in the early documentation. Attention was drawn to an early conversation with the head of HR in the Australian firm, Mrs Thomas, in the September 1997 PriceWaterhouse in Asia publication describing Bastian as being on secondment from PriceWaterhouse Sydney, and later, when the applicant's role in Greece was being discussed and Mr Poulter referred to a "secondment". 81 It was submitted that, in the alternative, it may not matter whether or not the applicant was seconded as a matter of law. That is because one of the ways in which the contract with the first and/or the third respondent was unfair was that it did not provide him with the benefits that secondment would have provided. In essence, there was a secondment to Singapore: it was an international transfer between PriceWaterhouse entities. Mr Bastian was given home leave and sent ex-patriate correspondence. He was placed on leave of absence. 82 The respondent submitted that the leave of absence granted was for retirement purposes only, but there was no reason why Mr Bastian could not have been placed on leave of absence for all purposes. Such an approach would have provided him with continuity of service. It did not matter that there was no guarantee of a position on returning to Australia because it would have been fair to have maintained continuity of service during the Singapore appointment. Further, the first respondent still had the applicant available to be used during that period if it desired. That was the way the international network of PriceWaterhouse operated, as shown by using the applicant's skills while in Singapore to support the Athens Olympic bid. There was little doubt that, if a suitable project arose in Australia within the applicant's skills, he would have been utilised by the first respondent for that purpose. 83 On the respondent's case, the only reason why there was no formal secondment was to convince the Asian clients that there was a commitment to this joint venture: or, for internal purposes, to ensure that no precedent would be set in relation to his salary. It was of significance that other employees of the joint venture (Bourdeaux and Box) were on secondment from Europe and Australia. Later, Hagger was seconded while an Australian partner. 84 As to why there was a redundancy, it was submitted for the applicant that the undercurrent of allegations of non-performance were never fairly and squarely put to the applicant to enable him to deal with them, and the final matters that led Poulter to refuse to provide a contract for Greece were never identified to the applicant. Effectively, the applicant was placed in a position where a two year appointment with an option to extend was not renewed and there was no position for him within Australia, Europe or Singapore. The applicant had been serving the wider interests of the first, second and third respondents by being available to be used by the PriceWaterhouse group internationally and had found that, at the end of his two year appointment in Singapore, he was redundant as there was nothing suitable for someone of his seniority and experience, so the respondent said. For those reasons it was fair that his termination be categorised as a redundancy, entitling the applicant to reasonable redundancy payment and reasonable notice. 85 It was submitted that the relevant factors in relation to reasonable notice of termination in this case were: (a) the fact that the applicant effectively served the first and/or second respondents in their interests for a period in excess of six years; (b) the applicant's position was a very senior position - he had developed highly specialised expertise in relation to funding and the construction of Olympic infrastructure; (c) the applicant's position was equated with that of heads of project finance in US and Asia; (d) the applicant's salary at the time of his termination was large, being paid a total package including base bonus of S$465,000 as at the date of termination. Had the applicant gone to Greece it could hardly be expected that he would have been on a lesser package; (e) the applicant uprooted his family from Sydney to move to Singapore for two years - such disruption should be taken into account; (f) the appellant's wife also gave up her employment so that the applicant could move to Singapore. 86 Applying the approach of the Full Court in David Jones Ltd v Cukeric (1997) 78 IR 430 at 462, the money order should reflect all elements of the package. In this case, the full package for the applicant was valued at S$465,700. It was greater if the rent for his Sydney house was added. Further, the base bonus should be included in the package. Two further matters to take into account were the fact that his wife had given up her job and that the applicant's actual base and bonus component was approximately S$100,000 under what he should have been paid as disclosed by the respondents' documents. Redundancy should be paid on the basis of one month for every year of the applicant's six years of service that he was either employed by the first and/or third respondent or on assignment in Singapore. 87 Reasonable notice should be separately compensated at an amount of 12 months on full package. It was neither appropriate nor fair, as submitted by the respondent, to treat the applicant as being given notice of the termination of his Singapore contract in January 1999. The overwhelming weight of evidence pointed to the fact that the applicant was informed, in circumstances where he was going to Greece as Project Director for the Olympic contract, his Singapore contract would not be extended. He was not told that there was no work for him at all until 27 April 1999. 88 In relation to discretionary factors, the applicant suggested that nothing turns on the fact that the applicant obtained employment with KPMG after his termination in circumstances where that employer made him redundant in November 1999. The applicant sought to be put into the position he would have been in had his contract contained the terms entitling reasonable termination. If that had been done, he would have received his full entitlement without set off for KPMG or any other employment (Harcourt Brace & Co (Aust) Pty Ltd v Cory (1997) 81 IR 321. Another discretionary factor was that his termination was without warning and without being given any chance to refute the allegations about lack of performance. If the respondents had acted fairly, they would not have given the applicant notice in April 1999 but, instead, would have given him a chance to persuade them that his employment should continue. This factor is to be balanced against the applicant's KPMG earnings and the exercise of the discretion as to what notice was reasonable. Lastly, if the applicant is successful then his contract as varied would have entitled him to a payment from the respondents even when his car loan was set off. He would never then have been subject to the order of the District Court that he pay the second respondent the costs of those proceedings. That fact may be taken into account in the overall exercise of discretion. 89 On the issue of unfairness, the applicant relied upon Baker v National Distribution Services Ltd (1993) 50 IR 254 at pp 271 - 272 for the proposition that it was appropriate to examine the balance of advantage and disadvantage between the parties and their comparative bargaining positions when entering into the contract or arrangement. It was alleged here that there was gross inequality and bargaining power in favour of the respondents as evidenced by the following matters: (a) the applicant was asked to go to Singapore; (b) the applicant decided that he would go to Singapore and expected to be able to negotiate a reasonable package with his employer; (c) very late in the negotiations - "out of the blue" came a no right to return proviso; (d) the applicant then reasonably requested a higher package to take that into account; (e) such a request was rejected and the applicant took what was on the table; (f) the offer was clearly below that which someone of the applicant's capabilities would have received on the respondent's own documents; (g) the applicant clearly believed that the bargain he had made meant that he was on secondment . 90 The applicant said he relied on representations made to him by both Mr Poulter and Mr Watson; both of them deny the representations in the terms claimed by Mr Bastian. In determining what representations were made, the applicant said the following circumstances were relevant: (a) Mr Poulter was concerned to reach final agreement with the applicant as he was the only suitable candidate for the position and printing had already been organised with his name on it and conferences were scheduled to commence shortly involving the applicant; (b) This information was conveyed to Mr Watson who was in the mood to accommodate Mr Poulter's anxiety if he could by reaching final agreement with Bastian; (c) towards the end of the negotiations, the applicant was informed of the no right to return clause which concerned the applicant; (d) the applicant sought to increase his package if there was to be a no right to return; (e) Mr Watson did not want to increase the package as he had been requested not to set a precedent by paying too much to the applicant when compared to other PriceWaterhouse employees. 91 The applicant suggested that it was a fair inference and commonsense that both Poulter and Watson, in these circumstances, were trying to persuade Bastian to accept the offer when he was seeking more money. The representations were about his long term future and an assurance that the no return clause was merely to prevent a precedent for other ex-patriates. Such a representation by Poulter was consistent with his own evidence that what is true changes according to the circumstances. It is also likely that Watson made the representation because Bastian had no other way of knowing that Watson had been spoken to about not creating a precedent in the setting of Bastian's salary. Another matter of significance was that, at this stage, there was no evidence of poor performance and Mr Watson had conceded under cross-examination that he had positive things to say to Mr Poulter about Bastian's ability. It is also consistent with the representations being made that this hurdle to acceptance by Bastian was no longer an issue after the claimed representation. 92 It was submitted that the bonus was a integral part of the applicant's remuneration, a matter accepted by Poulter. The applicant's bonuses had increased progressively over the years from $17,995 in 1994 to $141,000 in 1996. Bonus was one of the matters emphasised by Watson in persuading Bastian to take up the Singapore offer. The package offered by the respondent contained a base and bonus component with other extras indicating that the bonus was an important part of the package and one which was generally expected to be paid. In 1998/1999 there were two types of bonus - one was based on profit and the other was a discretionary bonus of $100,000 which was paid above the line and before profit. Bearing in mind that Mr Bastian's effort was pivotal in winning the Athens Olympic bid, this was precisely the type of performance to be rewarded by discretionary schemes. The winning of the bid had generated future order book work and work elsewhere in the network which was required by the discretionary bonus scheme. Mr Hagger had envisaged that the applicant's efforts in Greece would be rewarded, suggesting that the Greek office should pay the bonus as Bastian was going to Greece. 93 There was no doubt that the Athens win was prestigious, as Poulter accepted, and was described by Mr Hagger as "an absolutely tremendous win", with Bastian being a key player and resulting in a US $3 - 4 million win for the firm and a personal triumph for Bastian. In light of the Asian crisis and the later concentration of Mr Bastian's effort in Greece, it would be unfair of the respondent to point to lack of performance as a reason why the bonus should not be paid to the applicant. In assessing the joint venture, the figures alone should not be taken in isolation, as the respondent itself accepted that there are other matters to be taken into account. It was then submitted for the applicant that it would be fair and just in the circumstances to reward Mr Bastian for his outstanding performance in winning the Athens bid to be paid his base bonus of $50,000 from the discretionary pool. As the applicant pointed out in his evidence, on the bonus incentive scheme he was on while in Sydney, he would have received 5 per cent of the net revenue generated. This would have been far in excess of $50,000. 94 It was also put for the applicant that the unfairness in his contract was that it did not guarantee payment of his base bonus should there be a key role played such as winning the Athens bid. This unfairness could be overcome by varying the contract to provide for the payment of the base bonus of S$50,000 in the event that he played such a key role in the winning of the bid. There was also unfairness in the contract in that the first respondent did not remain primarily liable to pay the applicant's entitlement whilst he was working for the joint venture. The first respondent was a shareholder in the joint venture company and was involved, through Watson, in negotiating terms of the contract, and the first respondent was also involved in negotiating the separation terms. 95 The applicant's case concerning the motor vehicle was that it was unfair that his contract required him to bear the burden of any significant depreciation or loss on the sale of the motor vehicle when he left Singapore. It was Poulter who directed that the loan was to be made to the applicant, resulting in the applicant taking the risk which he was told was a depreciation of approximately S$6,000 per annum. The loss on the sale was S$40,000. The evidence showed that employees of the PriceWaterhouse firm could be compensated for loss on the sale of their motor vehicles. It was accepted by the applicant that it would be fair to deduct from the amount claimed on the loss that component of the car allowance that was available to compensate him for depreciation. That was small, being S$5,720. Accordingly, the applicant claimed the loss on the sale of the motor vehicle in the sum of S$34,280. 96 As to who was the applicant's employer, it was submitted that the true employer was the first respondent. Armstrong signed the 1993 contract as partner, the profits were earned from the applicant's work and distributed to the partnership, and the third respondent was only a service company. There was no evidence that the respondent, in fact, ever told the applicant that he was not employed by the first respondent and the service company did not direct the applicant's work - that was done by the partnership. Decisions on hiring and firing were made by the partnership, not the administration company, and payslips were made out in the name of PriceWaterhouse, the trading name of the partnership rather than the name of the administration company. The third respondent actually paid the applicant's salary and issued a group certificate - that was all. In the alternative, it was argued that if the true employer was the administration company, the third respondent, then the applicant's claim against the first respondent was pressed on the principles outlined in Brown & ors v Rezitis and ors (1970) 127 CLR 157. The basis of that claim is that the first respondent obtained all of the benefit from the applicant's employment, even though he may have been technically employed by the third respondent. 97 In relation to interest, the second respondent had refused to await the outcome of these proceedings before demanding payment of the car loan. In those proceedings, the second respondent had demanded interest which was ordered by the District Court at the rates set under its Rules from July 1999. It was appropriate that any interest payable to the applicant be calculated on the same basis. 98 For the respondent, it was submitted that this was a case where, even if there was found to be relevant unfairness, no order for the payment of money would be appropriate. Essentially, this is because, when Mr Bastian returned to Sydney, he accepted employment with KPMG for $250,000 excluding bonus payments. Even if the applicant had returned to his former position with the first or third respondents in 1999, he would not have received more than a $250,000 remuneration. The applicant's salary in 1997 when he left Sydney was $114,000 and the base salary when he left Singapore was approximately A$215,000. The object of the section is to provide restitution (Harcourt Brace & Co (Aust) Pty Ltd v Cory at 336). An order for the payment of money is to compensate for loss - it is not to punish or to provide some bonus or windfall. 99 The principle of mitigation found to apply in Harcourt Brace does depend on the circumstances of the case. This is a different case to that dealt with by the Commission in Harcourt Brace and the mitigation principle would be appropriate here. The factors here were that Bastian had a job before his contract ended and that he knew no later than 13 January 1999 that his contract in Singapore would not be extended. He knew from not later than 27 April 1999, that he would not be engaged on the Athens Olympic project. Prior to the cessation of his employment, he was allowed time off, in May 1999, to look for alternative employment in Sydney. The cost of the flight to Sydney was paid for by the second respondent - the applicant was therefore afforded considerable assistance in order to find new employment. 100 The applicant secured an offer of an equivalent position to his former position in Sydney which was accepted on 11 June 1999. He secured an advance payment of $45,000 before the end of the 1999 financial year thereby increasing the net amount payable under his contract with KPMG. 101 The second respondent had offered the applicant an additional or ex gratia payment of S$33,750 at the termination of his employment, equivalent to eight or nine weeks' pay. It was true that that the respondents required the execution of a Separation Agreement in consideration for receiving the money but for this they could not be criticised. There was nothing inherently unfair in seeking a Separation Agreement and, indeed, its execution is in the public interest (see Cukeric v David Jones at 455). 102 The re-settlement difficulties experienced by the applicant would have followed if he returned to Sydney with any of the respondents. This was not a matter for further compensation. 103 The Singapore package for the applicant was not the appropriate standard to apply in the event that any award for part of the money be made to the applicant. For example, any allowance for the expenses of living in Singapore after 30 June 1999, would over compensate. 104 A separate and distinct issue was raised in relation to the second respondent, the Singapore Joint Venture company. The respondent submitted that the relevant jurisdictional question was whether the work performed under the contract with the second respondent was preformed in an industry in and of New South Wales. The relevant industry asserted by the applicant was the Project Finance Sector. It was well established that the jurisdiction of the Commission in proceedings under s 106 was limited (Perrot v XcelleNet Australia Ltd (1998) 84 IR 255 at 269; Chrysler Jeep Automotive Distributors Aust Pty Ltd v Canberra Star Motors Pty Ltd (1997) 79 IR 452; Savage v Digital Equipment Corporation (Aust) Pty Ltd (1999) NSWIRComm 227; Maloney v Hoffman 1980 AR (NSW) 318). 105 It was submitted that the applicant worked for the second respondent from Singapore and reported to Poulter. He described himself as having "geographic responsibility for all ASEAN countries, China, Korea and India". The focus of the area of work of the second respondent was Asia. The work undertaken by the second respondent from July 1997 was not in an industry in and of New South Wales. Further, from the inception, it was envisaged that the work of the second respondent would be in Asia and not in New South Wales. 106 While the Memorandum of Understanding between the shareholders of the second respondent covered all project finance advisory work in Australia, China, Hong Kong, Indonesia, Korea, Malaysia, the Philippines, Singapore, Taiwan and Thailand, it was clear from the evidence that the work in fact undertaken by the second respondent and, accordingly, the location of the industries in which the work of the second respondent was concerned and therefore the work of the applicant, was entirely outside New South Wales. The work in Australia was stated to be specifically excluded in a document prepared by the applicant, according to Mr Poulter's evidence. There was no work undertaken in an industry in New South Wales even if it was accepted that some work was performed in New South Wales. From July 1997, the applicant had no further role with the first respondent. 107 The third respondent employed the applicant until 30 June 1997; it was "the undisclosed principal of the first respondent which made an offer of employment to the applicant on 6 July 1993". This position was consistent with group certificates issued to the applicant during his employment by the third respondent. 108 Even if at law the applicant was employed by the first respondent, as contended by the applicant, that employment was terminated on 30 June 1997. 109 The terms of the offer of employment with the second respondent were clear - there was no guarantee that the applicant would be offered a position in Australia at the end of his time in Singapore. He had been advised of this position prior to receiving the letter containing the terms of the offer of employment. The applicant knew that this effectively meant that his employment was terminated. Consistent with termination, the applicant was required to re-pay holiday credits he had taken but not accrued. There was at the time no entitlement to long service leave in 1997. 110 The evidence of Poulter and Watson was to be accepted on the issue of representations said to be made to the applicant. Poulter was not in a position to commit the Australian respondent in relation to any future employment in Australia and the same applied to Watson committing the second respondent. The alleged representation, that Watson had said that PriceWaterhouse Australia would welcome the applicant back with open arms, was not consistent with: Mr Watson's denial; the applicant not being regarded as suitable for the partnership; the partners in the Australian firm not having a favourable impression of the applicant from his time in Sydney; the applicant not being regarded in Australia as the best person for the job in Singapore; Mr Watson having no anxiety as to whether the applicant took the position in Singapore; Mr Watson wanting the applicant to make his own decision and to weigh the pros and cons; Mr Watson's view that the applicant's prospects of career development to be nil; the fact that the applicant did not approach Watson for a job in Australia after he was informed that his contract in Singapore would not be extended; the applicant's approach to another person to enquire of any opportunities in Australia (and there were none); and the letter of appointment to Singapore specifying that it was for Australian retirement fund purposes that the applicant was to be placed on leave of absence. 111 The offer made for employment in Singapore was one of "employment" by the entity to be established at that time - there was no suggestion of secondment or any continuing role for the Australian respondent in the work of the applicant. 112 There was no relevant encouragement by the first respondent that the applicant enter into the contract with the second respondent. Poulter may have wished the applicant to accept that position but that was not the wish of the first respondent. Watson was indifferent and encouraged the applicant to simply make up his own mind. 113 Mr Watson was not challenged when he said that the offer accounted for the element of not being guaranteed a place back in Australia at the end of the contract. Nor could the applicant rely upon any conduct after 30 June 1997 to suggest unfairness in any contract or arrangement with the Australian respondents because, after that date, any contract or arrangements with them had been terminated. Conduct subsequent to the termination of a contract is not conduct which invokes the jurisdiction of the Commission. If the contract between the first respondent and the applicant continued after 30 June 1997, the evidence was clear that all conduct subsequent to that date was not conduct with which the first respondent was connected or concerned. After that date, the applicant reported to Poulter and the Australian respondents had no involvement in any decisions relating to the applicant's future with the second respondent. The Australian respondents had no involvement in the applicant's future in Athens. The Australian respondents were not involved in any decision as to whether the applicant's contract with the second respondent was to be renewed. The Australian respondents had no involvement in the assessment of the applicant's performance after 30 June 1997. 114 In relation to the non-renewal of the Singapore contract, the applicant was aware from November 1998 that his appointment in Singapore was not likely to be renewed. The second respondent honoured the terms of the fixed contract and gave six months' notice that it would not be renewed. It remained for the applicant to attempt to secure alternative employment in that time. 115 There was no link, as suggested by the applicant, between the non-renewal of his Singapore contract and his appointment to the Athens project. There was no right to be re-appointed to Singapore and no right to be appointed to Athens. These two matters were entirely different issues. While the applicant had been involved in the Athens project and may have hoped for a secure role there, he had no more than a hope for such a role. 116 On the issue of bonus, the first year bonus was not a guaranteed minimum but was paid in accordance with the bonus metrics at the rate of $40,000 for the year 1997/1998. The second year bonus was payable on different and separate terms to those agreed for the first year. The applicant's claim that his "qualitative" performance warranted a payment of bonus does not deal with the issue that it was "entirely discretionary". Bonuses payable in 1998/1999 were based almost wholly on the profitability of the company. The evidence disclosed that the profitability of the second respondent was extremely poor, was well below budget, especially after the impact of the Asian crisis. Whether performance based or discretionary, no other employee of the second respondent received a bonus for 1998/1999. While it was true that the applicant had played a role, and a key role, in obtaining the Athens work, it was completely untested as to the extent to which that work generated future order book. The anticipated fees from the Athens project were not exceptional. 117 The applicant received a car allowance of $2,000 per month. His claim seeks the difference between the purchase price of the car and its eventual sale price nearly two years later: it makes no allowance for depreciation. There is no proper basis to pursue this claim. The applicant had used his car for both business and personal use. The applicant is not to be accepted when he said he was forced to sell his vehicle due to the sudden nature of his departure because he was aware from January 1999 that his contract would not be renewed in Singapore. There is no reasonable basis upon which it can be alleged that the second respondent should be responsible for the normal depreciation of the applicant's vehicle. The generous treatment afforded to the applicant when he left Sydney, where the first respondent paid a portion of the loss asserted by the applicant on the sale of his motor vehicle, provides no proper basis to assert such a right in respect of the second respondent, or any Australian respondent on the cessation of his Singapore contract. This is particularly so in circumstances where the Singapore contract came to an end in accordance with its terms. DELIBERATION 118 The first issue which should be dealt with is the respondent's submission that the applicant's work with the second respondent was totally unconnected to New South Wales such that there is no jurisdiction under s 106 to make an order in relation to that contract. The answer to this question, in part, requires consideration of the nature of the PriceWaterhouse operation as well as consideration of the joint venture. It also requires consideration of the true nature of the arrangement by which the applicant came to be working in Singapore. 119 It is clear from the evidence that one of the strengths published and promoted by PriceWaterhouse firms was its global capacity to provide expertise to clients, especially those who may initially have had business interests catered for only in the geographic area covered by a particular firm. The evidence demonstrates that geographical areas are specified for the operation of a firm in the group, and that geographical area belongs to that firm, and is not shared with any other firm. The business of the group demonstrated that there are benefits flowing from some of the firms combining in jointly making available their expertise to particular clients. 120 The joint venture in Singapore was something of a different approach where, rather than the Singapore firm co-operating with other firms in the project finance market, a decision was made whereby a number of the firms would become shareholders in this initiative. PriceWaterhouse Australia, especially through Mr Bastian, was heavily involved in the promotion and acceptance of the concept of the joint venture. Mr Bastian's participation in consultation with Mr Poulter from London was approved by the Australian management and finance group. He was sent to Singapore, he consulted with Poulter and others, he was heavily involved in the drafting of the proposal and Australia became an active shareholder in the joint venture and a signatory to the Memorandum of Understanding which governed the operation of the joint venture. There were clear financial benefits flowing to the Australian firm from the success of the Singapore joint venture. The placement of Mr Bastian as head of the joint venture in Singapore also had the undoubted benefit to the Australian firm that their local clients could have confidence in becoming involved in Asian financial projects because there was a well known and qualified Australian heading the joint venture team. In particular, the Memorandum of Understanding proposed co-operation in the work and marketing of signatory firms within their territory. The signatory firms were to discuss opportunities but were to allow the central team to play a leading role. Despite his denials in oral evidence, the documents showed that Mr Poulter proposed that signatory firms would feed the joint venture, especially in the early days. There is force in the applicant's submission that the first respondent, at any time, could have availed itself of Mr Bastian's expertise for a project connected with the Sydney office - just as the Athens firm was able to use his skills in the Olympic bid. In any event, the joint venture contemplated signatory/shareholder firms co-operating by bringing their business to the central team. 121 While dealing with this subject, it is appropriate to clarify, as far as possible, what was the real relationship between the applicant, the first respondent (the Australian firm) and the second respondent (the joint venture firm in Singapore). The method of operation of PriceWaterhouse globally is somewhat ethereal. Although there are separate geographical entities, the evidence in these proceedings demonstrated that, in promoting their individual interests, it was common for there to be secondments and transfers of staff between entities and co-operation between entities as and when necessary and sometimes in order to do business which was not confined to a particular geographical area "owned" by a PriceWaterhouse entity. The evidence suggests that Mr Poulter conceded to the applicant that there were no strict rules or formulas for this co-operation and transferring of employees, but there were general concepts of secondment and transference. Undoubtedly, this facility to second or transfer staff not only added to the professional status and capacity of such staff, but also made the global operation of PriceWaterhouse more effective. While this method of operation lacks clear legal definition in many respects, I do not regard the transfer arrangements as a sham or deliberately vague in order to leave PriceWaterhouse employees in some kind of legal no-man's land. I believe the correct approach is to accept that the informality which appears to have attended such transfers and secondments in the past was simply born of a desire to most effectively use the talents of the staff in a global way, focussing upon the business objectives and not being greatly bothered by the legal definition of the new relationships being created. 122 It is therefore important, against this background, to recognise that Mr Bastian was being offered an opportunity to improve his status within PriceWaterhouse by transferring to the Singapore entity. He was not applying for some vacancy or new position which had been advertised by PriceWaterhouse globally. He was approached by Poulter, sought out and encouraged to take the position. I have no doubt he was also encouraged by Mr Watson to take the position, even though Mr Watson believed that Mr Bastian did not have the qualities to qualify him for appointment as a partner in the Australian firm: but partnership was another matter altogether. The evidence also makes it clear that, at the time Mr Bastian was offered the position, the real movers in the proposed joint venture were London and Australia. This was demonstrated by the fact that it was Mr Poulter from London and Mr Watson from Australia who were involved in the task of selecting the team leader. In oral evidence, Mr Poulter described Mr Watson as being in charge of Australia's interest in the joint venture. That there was encouragement to Bastian to accept the position is further demonstrated by the concession readily made by Mr Poulter and confirmed by documents in evidence that there was no alternative within the firm and that to secure an outside person would impose unjustified and unjustifiable costs. Also, the project had moved at such a pace that there was no longer time, realistically, to conduct an executive search for this position and, in any event, it was going to cost too much to obtain a "star". It is not surprising, in my view, that, in those circumstances, Mr Bastian was encouraged by the representations he claims to have been made to accept this appointment. 123 The following matters are relevant to a determination of whether or not the claimed representations were made to Mr Bastian. Mr Poulter was anxious to fill the role in Singapore - he had invited Mr Bastian to take up the position and had obviously told others of his appointment. Mr Poulter accepted the fact that he would not have appointed Bastian to Singapore if he did not think he had reasonable prospects of succeeding in the position: this view was formed despite the negative comments of Mr Watson. He had met Bastian several times and was satisfied he was the best man for the job. There is substance in the applicant's submission that Watson was likely to have made the alleged representations since he mentioned the need to avoid creating a precedent. Mr Bastian probably had no way of knowing of this matter other than being told by Watson, although Poulter could have mentioned it. It is significant that the hurdle of "no right of return" was overcome after Bastian was spoken to by Poulter and Watson. The overall evidence concerning Singapore and Athens leaves the impression that Mr Bastian was a tireless and persistent negotiator on his own behalf, understandably a feature of his nature which did not endear him to his superiors. It is likely that, having failed to secure more money for the transfer to Singapore, Mr Bastian at least satisfied himself that there would be a position for him somewhere globally, or in Australia at the end of his time in Singapore. Poulter also accepted that, being in charge of the European Project Finance Team at the time of these alleged representations, meant that he was well placed to obtain a position for Bastian in Europe. There may be significance in the fact that, in 1998, Poulter told Bastian that if he proved himself before leaving Singapore, Poulter would certainly expect to find him a position of appropriate responsibility in the network and would do his very best to do so. It is not surprising or unlikely that Poulter would encourage Bastian in these ways as he had become, since the mid 1990s, Bastian's mentor within the firm and the two of them spoke frequently about Bastian's career and his prospects within the firm. There is another matter which tempers my assessment of Mr Poulter's denials of these representations. On two occasions during cross-examination, Mr Poulter said that it was within the bounds of truth to use different words to say different things on different occasions, and that what is the truth varies with the circumstances. This was the approach he had taken, internally, in business. These comments arose in circumstances where he was shown examples of his own published words which Bastian had included in his affidavits and which Poulter had denied or had tried to diminish. I understood Mr Poulter to be saying, in part at least, that there were circumstances in business where he would not necessarily disclose his real views because he thought it better that something positive be said. These discussions with Mr Bastian may have been just such occasions. In this context, it is also significant that Mr Hagger gave evidence that the only person who came to the second respondent from a PriceWaterhouse firm and who had no right of return was Mr Bastian. Indeed, Mr Hagger himself came to the joint venture after Mr Bastian, on secondment as a partner in the Australian firm. No reason for this discrimination was exposed except for the desire to avoid creating a precedent. It is consistent with this desire that Mr Bastian was assured that his future was safe and that, in fact, he would not be treated differently to the other staff who transferred to Singapore. The alleged representations are also consistent with the draft proposal for the joint venture and its final form which was overseen by Mr Poulter and which proposed the senior staff to be "seconded" from PriceWaterhouse firms. Indeed, a number of PriceWaterhouse publications stated that Mr Bastian was in Singapore on secondment from the Sydney office of the Australian firm. Mr Watson said that, in May 1997, Mr Bastian informed him that he was "transferring to the joint venture" effectively in a partner's role. Mr Watson was quick to correct him about the fact that he was not a partner - Bastian was not corrected about "transferring" to Singapore. That conversation had an air of continuity about it which Mr Watson did not challenge. In addition, it was Mr Watson's evidence that he told Bastian that if he performed well in Singapore, Poulter would find him a position "somewhere" in two years' time. 124 At this early stage, in my view, the Australian firm was intimately connected with both the concept of the joint venture, its promotion and acceptance. It became closely involved in its operation. Both Mr Bastian and Mr Poulter had identified a significant untapped market: if the potential was realised, there were significant profits to be made by the Australian firm as a shareholder in the joint venture. The Memorandum of Understanding, signed on behalf of the Australian firm, locked the foundation shareholders into the project for a minimum of three years - they could not withdraw within that period. As demonstrated by the documents tendered, the initial shareholders were in this project for the long term, primarily because of what had been perceived as a lucrative, untapped, potential market. 125 What then was the relationship, in a legal sense, between the first respondent, (the Australian firm), the joint venture firm, (the second respondent) and Mr Bastian? As I have already said, Mr Bastian did not apply for a new job - with the approval of the Australian firm he was approached to transfer to Singapore. There is no evidence, including anything on his employment file, which shows that he was terminated, resigned or signed a letter of termination of his employment with the Australian firm. Importantly, he was placed on leave of absence, a concept dealt with by the first respondent in its published "Terms and Conditions of Employment". In particular the first respondent's terms and conditions publication stated the following: In addition, staff members may request leave of absence for up to two years to enable them to work in another PriceWaterhouse Firm overseas. At other times, staff may be placed on Leave of Absence when seconded to or working for another PW office. In this case, continuity of employment is maintained while you are away and subject to solid performance during your assignment, your position will be available to you on return from LOA. 126 Mrs Thomas' evidence was that it was her understanding that Mr Bastian requested leave of absence for the single purpose of retaining his life assurance within the superannuation fund. Mr Bastian denied that he had made any such request, and the basis of Mrs Thomas' "understanding" was never established. She had made no notes of these conversastions and was relying on her memory. The terms and conditions document also dealt with superannuation and contained the following provision: Upon joining the Firm you become a member of PWRF and that membership will continue while you are employed by the Firm. "PWRF" was the PriceWaterhouse Retirement Fund, said by the document to be the complying superannuation fund for staff members. In two important respects, the applicant was treated as remaining on the staff of the first respondent in the Australian firm: firstly, by being put on leave of absence and, secondly, by maintaining membership of the superannuation fund. Both of these matters speak strongly against there being a termination of his employment. It was also consistent with the way PriceWaterhouse employees transferred between global entities. 127 A further matter deserves mention at this point. For reasons which were not disclosed in the evidence, the first respondent did not take its employees into its confidence in relation to the technicalities of their employment. In an argument that will be dealt with later, it is said on behalf of the respondents that, in fact, the real employer of Mr Bastian was the third respondent, which Mr Watson described as no more than a service company. Interestingly, Mrs Thomas, as head of HR of the first respondent (and, incidentally, not of the third respondent), said that, during Mr Bastian's two year term in Singapore, he was "transferred" from the third respondent to another entity to reflect the fact that PriceWaterhouse, in 1998, had merged with Coopers Lybrand to form PriceWaterhouse-Coopers. There is no material whatsoever describing how this transference took place and certainly no suggestion that it was notified to, or executed with the consent of, the employees concerned. They were simply treated as book entries in one firm and transferred as book entries to another. It is consistent with this approach that, when Mr Bastian accepted the offer to work in Singapore, in accordance with their own policies he was placed on leave of absence and continued in the superannuation fund just like others who were seconded or who transferred to another PriceWaterhouse firm. 128 Another matter of significance in the present context is the role played by Mr Watson in negotiating the salary for Mr Bastian's new position in Singapore. Mr Poulter's clear evidence was that he was telephoned by Mr Watson who, in somewhat robust terms, required that he be responsible for negotiating Mr Bastian's remuneration package for the Singapore position. Mr Watson's role in these negotiations is not easily explained if Mr Bastian was resigning from the Australian firm and taking up a wholly new and separate position in a new PriceWaterhouse entity. Mr Watson says that he had been approached by Mr Dall, the managing partner of PriceWaterhouse Australia, about not wanting to set a precedent with regard to salary levels of Australians being transferred out of Australia. Mr Dall said that the package paid to Bastian should be treated with caution because it could cause considerable difficulty. It could be of no relevance to the Australian firm, however, what PriceWaterhouse firms overseas paid within that firm's structure - the only relevance could be that a person on secondment or transfer, who was still part of the Australian firm, might receive a salary that would cause others who were still part of the Australian firm to raise their expectations or their demands. This involvement of Mr Watson was therefore in the interests of the Australian firm and no one else. (It is also worth noting at this point that, at the end of his term in Singapore, it was Mrs Thomas, head of HR in Australia, who drew up the Separation Agreement, urged that it be pressed on Mr Bastian and, when signed, be returned to Australia to be kept with his employment file). 129 Mr Bastian thereafter negotiated his salary package for the Singapore position with Mr Watson. It was Mr Watson who made the final decision on the terms, conveyed them formally by letter, rejected all of Mr Bastian's attempts to improve them and had Mr Bastian sign his acceptance of the offer. The offer made was on PriceWaterhouse Australia letterhead and was signed by Mr Watson stating his position as partner in the Australian firm. 130 From this combination of material (although the matter is blurred by the lack of precision in the arrangements made by the parties), on balance, I am persuaded that Mr Bastian did not resign his position with the Australian firm in Sydney, but was effectively transferred for a two year period to the Singapore position. Whether or not this can be regarded as a secondment matters not - the effect is the same. The continued connection with the Australian firm was intended and not accidental. The package included provision for "home leave". Further, the arrangements were, on the evidence, consistent with the way the Australian firm and PriceWaterhouse globally operated and permitted their employees to obtain greater experience through periodic overseas postings. 131 In light of these matters, what can be determined about the relationship between the applicant, the first respondent and the second respondent? In final submissions, the applicant argued that, at least on one level, the arrangement whereby the applicant undertook a transfer to Singapore was an arrangement collateral to his employment in New South Wales. In my view, that is a correct description - there was, at least, an arrangement between the Australian firm and the Singapore firm for Mr Bastian to work in Singapore. Some light on the position is shed by Poulter's email to Mr Watson dated 24 March 1997. In that email, Poulter talks about Mr Bastian's "transfer to Singapore" and how the options for the position were restricted and how the only realistic option was Bastian. At one point Mr Poulter is moved to make the following statement: In short, if we want an internal candidate who has project financing experience we don't have a lot of choice. We should see John as a two year solution and hope that the number two we recruit can grow into the job. He then spoke about what was the appropriate amount to offer and suggested that the amount should give Mr Bastian "more security" than he has at the moment in recognition of the fact that he was going into a new market without many contacts, that he was taking on more direct responsibility than he "'has in Australia" and that "we are asking him to move". Again, Mr Poulter makes reference to the figures being spoken about as possibly being more than "you can easily stomach from an Australian perspective" but acknowledged that Mr Watson may get a better deal from him. This document clearly accepts that Mr Bastian met all the short term needs but was not necessarily being sent to Singapore as a long term prospect. It was specifically raised that whoever was appointed to the second in charge position would hopefully grow in the job and would be able to take it over. The talk about offering more security does not seem to have any substance, if all that was being proposed was the termination of Mr Bastian's Australian contract and the offering of a two year contract with a new entity in Singapore which in all likelihood would never be renewed. That possible alternative proposition is a very cynical exercise which would have rendered the arrangements unfair. In my view, the effect of the 1997 arrangements were not to terminate Mr Bastian's employment in Sydney, but permitted him to work in Singapore with the second respondent. 132 In addition to the other matters I have referred to concerning the relationships between the first respondent and the applicant, it is worth noting that: (a) when Poulter terminated Bastian's employment he said he had discussed it with personnel in Australia and others; (b) when Hagger was discussing the terms of his termination with Bastian, he sent copies of the notes of these meetings to Watson and Thomas in the Sydney office of the first respondent, and (c) the Separation Agreement, with its provision that there should be a release from further claims against the Singapore company "and its associated local and overseas entities including any members of firms of the worldwide PricewaterhouseCoopers organisation", was drafted by Mrs Thomas. She wanted the Separation Agreement signed and a copy of it for the Sydney file. These events, at the conclusion of the arrangement with Bastian regarding his work in Singapore, underline the continuing link and connection with the Sydney office of the first respondent. They are inconsistent with a 1997 termination of Bastian's employment by the first respondent and are inconsistent with the respondent's case that the Singapore contract was a stand alone employment contract solely with the second respondent and that, after it was entered into by Bastian, the first respondent had no further interest in or dealing with the applicant. 133 What I have said in the preceding paragraphs establishes a very substantial link between the work that was being performed by Mr Bastian, the work of the second respondent and the work of the first respondent that was being performed in New South Wales in the financial advising industry. In addition, the applicant asked that the following matters be taken into account: (a) the contract was negotiated in New South Wales; (b) the contract was negotiated by Mr Watson, a partner in the first respondent; (c) at the time the contract was entered into, all parties resided in New South Wales; (d) at the time the contract was entered into, the second respondent did not exist; (e) the contract was itself signed by Mr Watson as "managing partner, corporate finance" of the first respondent; (f) the first respondent was an equity participant in the joint venture project which was carried on by the entity of the second respondent; (g) the second respondent was the joint venture entity by which various partnerships of PriceWaterhouse worldwide (including the first respondent) could carry on project finance work in Asia; (h) Australia was initially part of the territory covered by the Memorandum of Understanding; (i) as pointed out to Mr Poulter by Mr Watson, the applicant's salary was to be shared between all the joint venture partners, which included the first respondent; (j) the transfer was referred to as an "internal transfer". I accept the relevance of all of these matters 134 It was submitted that there could be little doubt that the contract had its closest and most real connection with New South Wales and that the proper law of the contract was the law of New South Wales. The applicant submits that there can be little doubt that the applicant was performing work in a global industry of which New South Wales and Singapore were but part - even though the evidence suggests that the second respondent concentrated on the project finance advisory work in areas outside Australia that does not mean that, in working for the second respondent, the applicant was performing work that was completely divorced from or of an industry in New South Wales. In relation to the work that was performed by the applicant, the following matters were submitted to be of significance: (a) before the applicant left for Singapore he performed work in Sydney in relation to this new role; (b) the applicant performed work in Sydney attempting to generate work for PriceWaterhouse globally and in particular for the first respondent; (c) the first respondent continued to obtain business based upon the use of the applicant's CV. The applicant reported regularly to the Australian staff of the first respondent on new projects, leads for them to take to their Australian client base and information on changes to taking place for them to use to brief their clients, together with regular updates in relation to the Asian crisis; ( d) the information provided to the applicant was used by the first respondent; (e) the applicant performed work for the first respondent at the Brighton-le-Sands conference. 135 As to the principles to be applied in relation to this aspect of the case, the parties were in agreement that they were as laid down by Chrysler (and in Perrott. These principles had more recently been applied in Savage. Both Chrysler and Perrott referred to the judgment of the Court of Appeal in Ex parte Richardson re Hildred (1972) 2 NSWLR 423. 136 In that case Asprey JA stated: If persons who are in New South Wales make contracts in New South Wales intended to be governed by the law of New South Wales … then the legislature can create jurisdiction to avoid such contracts and this may be even if they are intended to be performed in whole or in part outside New South Wales … … prima facie the law of the place where the contract is executed is the proper law of the contract … 137 In the present case, the parties have not specified the law of the contract but, in my view, the proper law of the contract is the law of New South Wales. On the analysis contained in earlier paragraphs, I have expressed the view that the involvement of the Australian firm in the Singapore joint venture was to extend its financial advisory services into a new and potentially lucrative markets. While that was still a potential, the work in Singapore had to be performed and, after his selection performed by Mr Bastian in order to realise the potential. At the time the agreement was reached there was no Singapore entity yet created. The only parties at this stage were Mr Watson from the Sydney office of the Australian firm and Mr Bastian from the Sydney office of the Australian firm. Both were working to promote the interests of that office in New South Wales and their contract was made in New South Wales. The contract envisaged that substantially, work would be performed in Singapore but the connection with New South Wales and work in New South Wales industry was a factor, as I have discussed above. Further, if it is appropriate to consider the Singapore contract as a collateral arrangement to the contract with the first respondent, as I have found, then the connection with New South Wales and work in and of New South Wales is all the stronger. 138 Both Chrysler and Perrott indicate the law of the contract is only a factor and here this is especially so, because it was not specified by the parties but results from analysis and the application of the law. The cases also make it clear that merely because work is performed outside of New South Wales, this does not rob such a contract or collateral arrangement of the necessary connections. Indeed, in Perrott, it was held that the approach of Jacobs JA in O'Connor v Healey (1967) 69 SR (NSW) 111 was consistent with Chrysler and was the appropriate approach. In his judgment, which was adopted by the court, Jacobs JA counselled against too strict an application of the Interpretation Act in dealing with the equivalent of s 12 and the notion of being "in and of New South Wales". Further, in Perrott, the Full Court noted that the place where the work is performed is but one factor in assessing the relevant connection with New South Wales. It was accepted that an arrangement may provide the necessary link with New South Wales but that a transitory or casual visitation to New South Wales to perform work may not satisfy the test of sufficient connection. On the evidence in this case, although the work was performed in Singapore, apart from all the other elements I have already referred to, there were visitations to New South Wales by Mr Bastian to perform work in New South Wales for the first and second respondents. These visitations are a relatively minor factor but, together with the other matters I have mentioned, a sufficient connection with New South Wales is established (see also Perception Pty Ltd and anor v Myalong Pty Ltd and anor [2001] NSWIRComm 158 per Peterson J). In Savage, the Full Court noted that XcelleNet rejected the view that both the contract and the industry must be "in and of New South Wales". It was held to be an error to focus on such a contract and that the test was to look for the industry. Nothing in this case detracts from the conclusion that I have reached in relation to this particular matter. 139 It may be useful at this point to draw together the findings I have made in this section of the judgment. As I see the evidence, there was an arrangement between the first respondent and the second respondent whereby the applicant performed work in Singapore. In performing that work, there was work performed in an industry in and of New South Wales arising from the interests of the first respondent, its shareholding in the second respondent and the aim of the joint venture that, by co-operation, signatory firms such as the first respondent could do business in Singapore. Even if I am wrong about the New South Wales connection with the second respondent, the first respondent maintained an employment connection with the applicant during his work in Singapore. He did not resign to join the joint venture and remained on the books of the first respondent as an employee. The first respondent therefore remains liable for any unfairness in the Singapore arrangement regardless of the liability of the second respondent, and remains liable for any overall unfairness arising out of these arrangements. In this consideration I have not mentioned the third respondent because I regard it as no more than a service company for the partnership in Australia. The third respondent was never, in any relevant sense, the employer of the applicant. This issue is dealt with in the following paragraph. 140 The respondents have submitted that the real employer of Mr Bastian was the third respondent. I am unable to accept that submission for the following reasons. Mr Watson's evidence, already recorded in this judgment, demonstrates that the third respondent was no more than a service company and seemed to play no other role than to organise the payroll, including issuing payroll slips and group certificates. Whilst its name appears on the group certificate there is no other indication whatsoever in the evidence that it was, in fact, the employer of Mr Bastian or other persons who worked for the Australian partnership. It is true that, while Mr Bastian was a consultant, he signed a contract with the third respondent but this did not occur when he took up his substantive employment with the partnership in the middle of 1993. His letter of employment was signed then by Mr Armstrong as a partner and was on the PriceWaterhouse letterhead. From Mr Watson's evidence, it appears that the profits earned were distributed amongst the partnership and it was the partnership who made the decision to employ and, if necessary, discipline employees. It is not without its significance that the initial response in the Reply filed by the first respondent was to accept that it was the employer. It was only after a significant time into the timetable for filing and serving of affidavits that this position was reconsidered and a new Reply was filed by the respondents asserting that the third respondent was the real employer. Ultimately, not a lot turns on this matter because, even if the third respondent was the legal employer, on the evidence there is clearly an arrangement between the first and third respondents involving the applicant and the applicant's claim against these respondents would not be put beyond the reach of s 106 of the Act. 141 Having dealt with these matters, it becomes necessary to consider whether or not the contract, in its widest sense, was unfair in the way in which it dealt with the applicant. The applicant's case is that the contract with the first respondent was unfair insofar as it failed to treat him as being on secondment to the second respondent, or to treat him as being on leave of absence and thereby maintaining his continuity of employment. If either of these courses had been adopted, he would have been entitled to reasonable notice and redundancy upon termination of his employment in 1999. It is to be remembered that the letter of termination indicated that there was no position for him in Singapore nor in Australia, or in any of the European firms operating under the PriceWaterhouse global network. This decision was said to have been reached "with the knowledge of the Australian firm". The first and second respondents' lack of precision in dealing with transfers and secondments clouds the full import of the arrangements that are made whereby employees perform work in other PriceWaterhouse global entities. So it was in Mr Bastian's case. He was asked to go to Singapore in circumstances where the respondents were keen to pursue an expanding, potential market. They had no other suitable candidate and were not prepared to pay to recruit a star for the job. They knew the task would be initially difficult and that the second in charge was likely to take over the role. Other senior staff from PriceWaterhouse firms were placed there on secondment. It is not surprising that the applicant, in pursuit of his desire to become a partner, was persuaded that the acceptance of this position would permit him to show his true capacity and strengthen his claim for partnership and perhaps work with other entities within the PriceWaterhouse global operation. The late inclusion of the term that there would be no guarantee of a position in Australia at the end of two years was explained away by the desire not to set a precedent for Australians going overseas to work for other PriceWaterhouse entities. At the time that this appointment in Singapore was being finalised, Mr Bastian was entitled to know, in clear and unmistakeable terms, whether or not his employment with the Australian firm was terminated in order for him to be able to make an informed judgment about the value of the offer that was being made to him. He was also entitled to be informed as to whether he was just a "fill in" for two years while they looked for somebody better. If he had been forewarned of these matters, he could have there and then asked for appropriate separation payments or perhaps persisted in seeking different terms to take up the Singapore position. He was denied that opportunity by the way in which the respondents negotiated the package of arrangements for the Singapore position. In addition, if he had been told that his employment in Australia would be terminated and that he would only have two years in Singapore and that it would be the end of his career in PriceWaterhouse, he could easily have chosen to remain in his position in Sydney and not attempt to prove his worth on the international stage. There was no suggestion that there was anything about his performance in his role in the Sydney office of the firm that warranted his termination in the middle of 1997. He could have simply remained in that position. To the contrary, performance assessments made during that period showed him to score highly in terms of competence and technical ability although there were some criticisms of his personal style. The representations that I have found in substance made by Poulter and Watson were designed to assure Mr Bastian that, whatever happened, a position would be found for him when he left the Singapore position. All of these matters helped mask the situation that the respondents now say was brought about by Mr Bastian accepting their offer to move from his Sydney employment. 142 In my view, the contract and/or the arrangement entered into by the respondent and Mr Bastian was unfair. Quite apeart from the matters mentioned above, the contract or arrangement should have contained some protective clause enabling him to receive appropriate notice on termination and appropriate redundancy or severance pay in the event of such an occurrence: it should have provided for secondment or some continuity of service and it should have clearly specified which PriceWaterhouse entities were responsible for the provision of these benefits. In my view, the circumstances of this case nominated it for the application of the classic test enunciated in the cases, namely, that the nature of the unfairness is a plain matter of morals not law. (Davies v General Transport Development Pty Ltd (1967) AR (NSW) 371 per Sheldon J and the Full court in Baker. There is also a resonance in this case of the need for the implication of good faith provisions discussed in Renard Constructions (ME) Pty Ltd v Minister for Public Works [1991] 26 NSWLR 234 and in Pullen v R & C Products Pty Ltd (1994) 60 IR 183. This is a case where the contract or arrangement was unfair and where the conduct of the respondents led to it becoming unfair. These matters are intertwined as indicated in the judgment in Rothmans Distribution Services Ltd v Full Court of Industrial Court of New South Wales [1994] 53 IR 157 at 160 and in Reich v Client Service Professionals of Aust Pty Ltd [2000] 99 IR 69. 143 It then becomes necessary to consider what orders should be made to address the unfairness and the position in which Mr Bastian found himself. 144 The first issue to consider is whether there was a redundancy. The letter of termination forwarded to Mr Bastian in April 1999 by Mr Poulter advised him, on behalf of the second respondent and with the knowledge of the Australian firm, that his contract of employment with the Singapore firm would terminate on 2 July. The letter then stated: The decision reflects the unavailability of a role for you after that date. In the second paragraph of the letter it was stated: After careful consideration we do not believe you are the right person to direct that work (ie Athens), and we can see no other position for you in the firm in Europe, Singapore or Australia that would be suitable for your experience. Mr Hagger gave evidence that after 27 April 1999, no-one was brought in to replace Mr Bastian in the Singapore office. No other person was appointed head of Project Finance in Singapore until March 2000 and the delay in replacing Mr Bastian was in order to save funds. It will be remembered that, from its inception, the joint venture in Singapore was meeting difficulties because of the Asian financial crisis and was not returning the figures that had been expected for the operation, even though those figures factored in a loss in the first two or three years while the business was being established. 145 For a period of nearly a year the second respondent, because of the economic circumstances of the company, did not replace Mr Bastian. That strongly suggests that the employer, for an extended period, no longer wished to have this work performed by anyone and is consistent with various definitions of redundancy accepted in the Termination, Change and Redundancy Case (1984) 8 IR 34 at 56 and cases in this Court such as O'Brien v Australian Native Landscapes Pty Ltd (2001) NSWIRComm 145. The fact that there was no replacement of Mr Bastian in acknowledged circumstances of economically difficult times, plus the fact that there was no role for him in Singapore, strongly suggests that lack of performance was not the reason why the contract was not renewed and why he was terminated. 146 The general tone of the evidence suggests that there were certain people who found fault with Mr Bastian's manner: there were similar comments in his early annual assessments but overall, he scored very well, especially in relation to competency and technical ability. Even Mr Poulter, who in evidence was at pains to point out every possible aspect of dissatisfaction with Mr Bastian, had to accept in cross-examination that in the middle of 1998, a year after he had gone to Singapore, Poulter himself had described Mr Bastian's performance as "good" and deserving of a pay rise which was duly arranged. Mr Poulter did suggest that it was not until later in 1998 and in early 1999 that dissatisfaction arose with Mr Bastian's performance but, as I have indicated earlier, there was a singular lack of evidence or analysis of this lack of performance but, rather, just generalised commentary without any specifics whatsoever. 147 Another matter which sheds light on the reason for Mr Bastian's termination appears to be his pursuit of a partnership and a strong resistance to it in the Australian firm. When, early in January 1999, Bastian telephoned Poulter to inform him of his interest in the Athens position, Bastian again mentioned his desire to be made a partner and to return to Sydney at some appropriate time. He expressed the view that to return not a partner would have "serious negative connotations" within PriceWaterhouse. His aspirations in relation to the Athens position appear thereafter to have taken a turn for the worse. Within a week Poulter was calling him and telling Bastian that he was not partnership material, at least "not yet", having not proved his management or technical ability. Decisions about his career and "how we manage your career" had to take this into account. Negotations dragged and he was urged to put forward a proposition so the firm could assess whether or not they could meet his demands. Bastian does not appear to have given up his plan for partnership and may have overplayed his hand in the belief that he was indispensable, having been such an important part of the Athens success. This, most likely, was the reason for Poulter giving up on the prospect of reaching agreement with Bastian on terms for the Athens appointment - terms which could be accepted globally by PriceWaterhouse. Once this point was reached, termination was the easiest option. Performance or performance alone was not the reason for Bastian's termination. 148 Overall, I am not persuaded that Mr Bastian's performance was the reason he was terminated in Singapore, even though some people may have had misgivings about him and his style. Mr Poulter seems to have remained a supporter of Mr Bastian even in August 1998 when he referred to the misgivings by some Australian partners for reasons that he was not aware of and could not therefore assess. It appears to have been these generalised and vague misgivings which plagued Mr Bastian's career with PriceWaterhouse but which, on balance, I cannot accept as the reason for his termination in April 1999. Indeed, the letter of termination does not allege lack of performance: he was not the right person to lead in Athens and there was no place for him elsewhere. I am therefore prepared to accept that there was a redundancy in 1999 by reason of his termination from the Singapore position. The redundancy is nevertheless relevant to the Australian firm because of the arrangement, as I see it, whereby Mr Bastian, to use a neutral term, remained with the Australian firm but located with the joint venture for a minimum period of two years. 149 If Mr Bastian was really on transfer/secondment from the first respondent, an issue may arise as to whether the relevant redundancy was in Australia, rather than in the Singapore position. Mr Bastian was informed that there was no position for him in Australia and other places, so it appears that he was certainly not required for his previous position in Sydney with the first respondent. It seems to follow that the first respondent did not want the work he had performed in Sydney to be performed any more - by Bastian or anyone else. There was no work in Australia for a person of his experience. This situation seems to fall squarely within the concept of redundancy. It will not matter then, for the purposes of determining whether or not there was a redundancy, whether it is the Singapore position or the Sydney position from which he was terminated. 150 The next issue to be considered is the question of reasonable notice. I accept the applicant's analysis of the evidence that there was no notice given in November 1998 or before the end of April 1999, in any relevant sense. I regard the relevant factors here to be: the quite senior position held by the applicant in heading the Singapore joint venture; his age, being 45 at the time of termination; the nature of the industry in which he was working and the highly specialised role he had undertaken; his service with the PriceWaterhouse entities for a period in excess of six years; his generally good work performance demonstrated over that period; his personal circumstances in being required to return to Australia with his family after a relatively short period in Singapore and re-establish his life and that of his family; and the likely difficulty of him obtaining employment of a similar nature and similar status with the potential for international appointments. 151 In a number of cases, this Court and its predecessors have grappled with the extent to which severance pay arising from redundancy has elements which overlap the concept of reasonable notice as that concept has developed in the common law and been applied by this Court. In my view, there is no precision about this matter but, to some limited extent, there are elements in the notion of redundancy which seem to be reflected in components of reasonable notice. An important distinguishing factor, recognised by the Termination, Change and Redundancy Case is the loss of security of employment. It is for that reason, unless a particular award provision is made, that redundancy is often payable even though new employment is immediately obtained after the termination. In this particular case, Mr Bastian appeared to have secure employment with options to develop and improve his skills, and thus his total remuneration, by participating in the global PriceWaterhouse structure. That all came to an end in 1999 and, although he obtained employment immediately with KPMG, I do not see that as a reason disentitling him from some consideration for the payment of either reasonable notice and/or redundancy pay. It was agreed between the parties that the employment with KPMG was equivalent to the position Mr Bastian held with the Australian firm, the first respondent, as at 1997 prior to taking up the Singapore position. It was, therefore, in terms of package and relative status and seniority, something less than the position he obtained in Singapore. As it turned out, it was not a secure position and after three or four months his position became redundant with KPMG. In those circumstances, I believe, in fairness, that there should be no discount or reduction in the severance payments/reasonable notice payments made to Mr Bastian. Because of the difficulty of drawing a clear line between the two concepts of reasonable notice and redundancy, I am of the view that both these considerations, in this case, should be taken into account in deciding a monetary amount to be paid for all of the elements contained within these two notions. In my view, an amount equal to ten months' pay at the package applicable as at 27 April 1999 is appropriate in all the circumstances. 152 The next issue concerns the payment of bonus and whether anything should be included within the applicant's package for this element. A further issue is whether the availability of a discretionary bonus should result in any payment because of the participation of the applicant in the successful bid for the Athens Olympics project. The respondent points out that, when the applicant was appointed to Singapore, his contract provided for a base bonus to be calculated and paid in accordance with the bonus metrics. This was not a guaranteed minimum and in fact, for the year 1997/1998 a bonus of $40,000 was paid. The terms of the bonus in the second year were separate from those agreed for the first year. The discretionary bonus involved a sum of $100,000 before profit. It was available on the basis of an incentive and a reward for performance and in recognition that, in the first two or three years of the joint venture in Singapore, there would be no profit made. For the 1998/1999 year, none of the other employees in Singapore received a bonus because none qualified under the scheme that applied and because the second respondent came in below budget in circumstances where the Asian crisis had an impact. The applicant, however, submits that the role he played in the winning of the Athens Olympics bid for the firm was of such importance that an amount, suggested to be S$50,000, should be paid out of the discretionary bonus pool. There had been some discussion between Hagger and Poulter about the applicant's request for a bonus flowing from his Athens work, but the consensus appeared to be that such a bonus should be paid from the funds of the Athens firm rather than from the joint venture. This appears to have more to do with the fact that the joint venture was not performing well in difficult economic circumstances and ignores the provision of the S$100,000 discretionary bonus for precisely such outstanding performances. If the $100,000 pool was not illusory, then it is difficult to see why an amount should not have been paid to Mr Bastian for his Athens work: the evidence was clear that co-operation between firms would certainly allow some contribution to be made from the Athens firm if the bonus was paid. The respondents also say that the bonus pool was only available for qualitative performance warranting a payment and, although the applicant's role in securing the Athens project was a key role or even a pivotal role, it remained untested as to the extent to which that work generated future work for the respondents. Interestingly, in cross-examination, Mr Poulter accepted that Mr Bastian's involvement in the Athens project had as its objective to assist in winning the bid and that part of the objective was achieved. He also agreed that the success in the bid did generate "order book" and also generated work elsewhere in Singapore. It appears, therefore, that the requirements for payment from this pool were met by Mr Bastian but it may well have been that the issue of who should pay or in what proportions was somewhat of a thorny issue within PriceWaterhouse which was able to be side stepped when Mr Bastian was terminated. 153 Mr Poulter also agreed in cross-examination that bonus was an integral part of the salary package for Mr Bastian. Further, the bonus was one of the matters that Mr Watson mentioned in his discussion with Mr Bastian before he had accepted the offer to transfer to Singapore. Mr Watson had effectively said to him "Why don't you just take the money?". A further consideration is that it appears in every year Mr Bastian was paid a bonus, in 1995 approximately A$41,000 and in 1996 a rather large bonus of A$140,000 odd. In the first year of his Singapore appointment, he was paid S$40,000 in what were otherwise difficult economic circumstances in the region. 154 It will usually be a difficult task to assess what bonus should have been paid in the absence of representations or some clear offer where the Court is simply involved in the task of satisfying itself that the nominated bonus was properly payable. In this case, bonus was clearly an important feature of the terms and conditions of employment no matter what the position occupied by Mr Bastian. There were clear representations of significant bonuses flowing from the Singapore joint venture. Some of the difficulty in this case is removed by the fact that S$100,000 was set aside in a pool and was available for the type of work Mr Bastian performed in relation to the Athens bid. In all the circumstances, it seems to me that fairness would see Mr Bastian in his second year in Singapore paid a bonus no less than he was paid in his first year as a direct result of his much acclaimed key role in winning the Athens bid. A one off bonus of S$40,000 will be paid to the applicant on that basis. The sum of S$40,000 will not be included in the remuneration package for the purposes of calculating the ten months' pay which Mr Bastian shall receive as a result of his termination. There was no guarantee of bonus under the Singapore arrangement and no one else was paid a bonus in 1999. In those circumstances, no bonus should be included in the package for the calculation of termination pay. 155 The applicant's claim to be reimbursed for the loss made on the purchase of the motor vehicle in Singapore excited much attention in the evidence called by the respondents. That evidence established there were, by Australian standards, unusually high costs incurred in owning and operating a motor vehicle in Singapore. It was, in fact, Mr Poulter's direction that, rather than have the firm supply a car to Mr Bastian, the company should provide a loan for that purpose. In his calculations, the applicant noted that he had been informed that depreciation would run at about S$6,000 per annum and that, in fact, the car allowance paid to him made a small allowance for depreciation of S$5,720. Working on the basis that he made a loss of S$40,000 on the sale of the motor vehicle, the applicant claims an amount of S$34,280. Not surprisingly, the Singapore package envisaged that Mr Bastian would have a car, and the only issue became how much would be paid in the package on account of this element. In discussions between Mr Bastian and Mr Hagger, when Hagger was attempting to work out the cost of closing down the joint venture, it appeared he accepted that people such as Bourdeaux would be entitled to payment for the loss on his motor vehicle and that "worst case" positions, which included such losses, were put together so that they could be considered by the shareholders. In these discussions, Mr Hagger did not suggest that such payments were unreasonable or otherwise not to be contemplated. In this exercise, Mr Bastian's loss on his car was also factored in. It appears to have been part of the respondents' approach to pay something for losses on motor vehicles and, indeed, the first respondent paid half of the loss incurred by the applicant when he sold his car on leaving Australia, based upon an NRMA valuation. I am of the view, in line with the firm's practice, that there should be some amount paid on account of this element. The applicant has calculated the total loss at S$34,280 and I would allow half that amount, S$17,140, as a one off reimbursement. That figure will not be included separately in the package for the calculation of other payments contemplated in this judgment. 156 The respondents press that, should there be any order made for the payment of any sum to Mr Bastian, then the principles of mitigation should be applied. It is then submitted that, since he was able to obtain employment with KPMG at the same level as his position in the Sydney firm before he left for Singapore, no amounts should be payable at all. I reject that approach as I do not regard it as being just in the circumstances of the case. I accept, on the authority of the Full Court of the Commission in Court Session in Harcourt Brace that regard should be had to the principles of mitigation. That does not automatically mean that there should be discounted from any money order made in favour of the applicant sums of money earned during the period for which payment in lieu of reasonable notice had been ordered. Mr Bastian acted reasonably in accepting the first employment he could obtain on his return to Sydney, and while he acted reasonably in doing so, that employment was not at the senior level he had enjoyed nor at the rate overall with its prospects for large bonuses that was available to him while employed in Singapore. The complicating factor in this case is, as a matter of fairness, I have taken into account both the elements of redundancy and reasonable notice in finding that the contract should be varied to include a payment of the equivalent of ten months' salary on the total package upon termination. I do not believe that there is any warrant for applying the principles of mitigation to severance payments made on account of redundancy as a general principle or in the circumstances of this case. As I have indicated earlier, the TCR test case contemplated that specific provisions could be made when work was arranged with a new employer so that severance pay could be avoided. In concept, this is not such a case: there is nothing in the terms and conditions of the respondents which seem to embody such an approach to their non-award employees. It is because of these considerations that I do not believe it is appropriate or just in the circumstances of this case that there should be any amount deducted in mitigation because of the short period of employment that Mr Bastian was able to take up with KPMG. This approach seems to be consistent with the approach of the Full Court in New South Wales Health and Research Employees Association of NSW (unreported, 31 March 1993, pp 80 - 83) cited with approval in Harcourt Brace. 157 It is also just in all the circumstances that interest be paid on the outstanding sums which become due to Mr Bastian as a result of this judgment. It has been suggested by counsel for the applicant that the parties should be permitted time to consider the terms of the judgment before final orders are made and to allow some discussion to take place as to the conversion of Singapore dollars to Australian dollars for the purpose of such orders. That appears to be an appropriate course and I will re-list the matter on 24 hours' notice given by either party. In order to assist the parties in their discussion, the orders I propose will operate on a total package containing the following elements, expressed in Singapore dollars: Salary: S$195,000 Rent: S$129,600 Utilities: S$ 12,000 Vehicle: S$ 24,000 Club fees: S$ 6,000 Medical fees: S$ 5,100 Home leave: S$ 13,000 School fees: S$ 31,000 Total: S$415,700 158 In addition to the above sums, there will be a separate payment of $40,000 for bonus and S$17,140 as part reimbursement for the loss on the sale of the motor vehicle in Singapore. I also propose that the respondents pay the applicant's costs. If there is any issue in relation to that matter, it may be raised at the same time as consideration is given to the making of the other orders. oo00oo DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.