TANAKA v. TOKYO NETWORK COMPUTING P/L [2003] NSWSC 1114

New South Wales Supreme Court

CITATION : TANAKA v. TOKYO NETWORK COMPUTING P/L [2003] NSWSC 1114 revised - 22/03/2004 HEARING DATE(S) : 24, 25 & 26/11/2003 JUDGMENT DATE : 11 December 2003 JURISDICTION: EQUITY JUDGMENT OF : Bryson J at 1 DECISION : Judgment for the plaintiff - see [99].

CATCHWORDS : CONTRACT - employment - repudiation by reduction of salary - Tanaka (Plaintiff) sold majority shares in Tokyo Net (1D), an ISP, to KDDI (2D) and was employed for 3 years as CEO. Tokyo Net depended on loan from KDDI for working capital - KDDI refused to renew the loan, directors considered preparation of a proposal to KDDI to renew loan with reduction in costs, and by majority resolved to reduce Mr Tanaka's salary - Tanaka treated this as anticipatory breach and repudiation, accepted repudiation and sued for damages: issues of fact about whether resolution was conditional on submission and approval of loan renewal proposal: on the facts, it was not conditional, reduction in salary was repudiatory, damages awarded. - VENDOR and PURCHASER - shares in private company - option - in the Sale Agreement Tanaka had Put Option to sell his remaining shares if his employment was terminated within 3 years - after accepting repudiation he exercised Put Option - option not available if he resigned: on the meaning of the Sale Agreement, he did not resign by accepting repudiation: Sale on exercise of option enforced by Specific Performance. LEGISLATION CITED : Evidence Act 1995 Long Service Leave Act 1955 Advertiser Newspapers Pty Ltd v. Industrial Relations Commission of South Australia (1999) 90 IR 211 Associated Newspapers Ltd v. Bancks (1951) 83 CLR 322 Federal Commerce & Navigation Co. Ltd v. Molena Alpha Inc. [1979] AC 757 Laurinda Pty Ltd v. Capalaba Park Shopping Centre Pty Ltd (1989) 166 CLR 623 CASES CITED : Leotta v. Public Transport Commission (NSW) (1976) 50 ALJR 666 Rigby v. Ferodo Ltd [1988] ICR 29 Saad v. TWT Ltd (CA NSW 29 May 1998 unreported) Handley JA Shevill v. Builders Licensing Board (1982) 149 CLR 620 Tramways Advertising Pty Ltd v. Luna Park (NSW) Ltd [1938] 38 SR (NSW) 632 Water Board v. Moustakas (1988) 180 CLR 491 Yoji Tanaka - P PARTIES : Tokyo Network Computing P/L (1D) KDDI Australia P/L (2) FILE NUMBER(S) : SC 5126/2002 COUNSEL : A. Sullivan QC & N. Manousaridis (P) A.S. Martin SC (D 1&2) SOLICITORS : Elson Pow & Associates (P) Abbott Tout Solicitors (D 1&2)