DAMAGES FOE WRONGFUL DISMISSAL.

Otago Witness, Issue 2561, 6 May 1903, Page 4

DAMAGES FOE WRONGFUL DISMISSAL.

AN IMPORTANT JUDGMENT.

At the Resident Magistrate's Court on Monday Mr E. H. Carew, S.M., delivered judgment in the action Smith v. Irvine and Stevenson, which was a claim for £225 damages for wrongful dismissal. In the action the plaintiff was represented by Mr Finch and the defendants by Messrs Hosking and Payne. His Woiship gave judgment as follows . —

This is an action to recover £255 as damages for wrongful dismissal, and thfe parties have agreed in writing that, notwithstanding the amount claimed exceeds JE2OO, the court shall have jurisdiction. The ev:'l°nco shows that plaintiff was employed by the defendants for about nine months m sup emit eschng the erection of a milk condensing plant at Henley, and on the Ist September, 1902, they exchanged documents, in which it was agreed that plajiitiff should serve the defendants as milk condenser and factory manager at then Henley factory for the teim of IS months at a salary of £5 weekly. The plamtiff tcok charge of the fnrtory and filtered on his duties. On October 16, 1902, a company was registered und a r ' The Companies Aot, 1882," as " The Irvine and Stevenson's St. George Company, Limited," and became possessed of the business of the Henley factory. No change appears to have been made in the personnel of the management, and the plaintiff leceived his instructions from Mr Stevenson, cs he did before ths company was registered. The p'aintiff say? he lc:ew a company was formed and had taken over the business, that he worked for the company and the company paid him h:s wages, and he did not object to work for the company under the same agreement, so long as he got hk money — that he did not either object or consent to work for the compnry. So long as he was paid £5 a, week by Mr Stevenson he wrs satisfied. There was no agreement eithpr by speech of in wilting that plaintiff was to be employed by the company, but he simply went on to work as he would have done if there had been no change of proprietorship. On March 4, 1903, the plaintiff received a letter signed by Mr William Stevenson on behali of " Irvine a. d Stevenson's St. George Company, Limited," giving him notice that Ins engsgenisnt was teimmated on the ground of mcompcterce and negligence. The plaintiff left, and was paid up to March 9, 1493. The thud count of lha particulars of demand sets out thpt on the lGfh October, 1902, the defer,d?nt<> wrongfully discharged the p'aintiff and iefu3od to peinut him to serve or to psy him for Ins seivices. Mr Finch contends that the defendants broke the contract when they transferred the Hcnlev factory to the company, and put it out of thenpower to personally employ the plaintiff at that factory, and that as soon as the company went into possession plaintiff had a cause of action for wrongful dismissal,' but so long as the new proprietors v, ere willing to employ plaintiff at the same work and at the same pay he coul-d hpve proved on 1 ? for nominal damages, but he is now out of emp'ojment, and sues for actual loss. Mr Hosking contends there was no breach by transfer to the company, and that there was a substitution of a new agreement to work for the company as accord and satisfaction for the foimer agreement. Brace v. Calder (2 Queen's Bench, p. 258) is clear authority that a d.ssolution of a partnership by some of the members retiring from it operated as a dismissal of a. managing clerk, who had contracted with the old hrin for a period which had not then expired. The present is a stronger case, because by transfer to a limited liability company there was ? complete change of proprietorship. That there could be ro

equilly , clear in Tolhurst v. Associated Portland Cement Manufacturers (1902, 2 X.8., 665). Co'lins, M.R., sad : " It is, I think, quite clear that neither at law nor in equity could the burden of a contract ba shifted off the shoul- ) ders of a contractor on to those of another without the consent of the cortractee. A j debtor cannot relieve himself of his liability ' to his creditor by assigning the burden of tae obligation to someone else; this can only b3 brought about by the consent of all three, and involves the release of the original debtor." If the fact that the plaintiff continued to occupy the same position after the company took over as he did before is evidence of a new contrp<;t, it is only of such a contract as would be implied by law from such service , and a weekly payment, of wages. There collide | be neither a. novation of the original contract or a substitution of a new contract for tho balance of the term, becauss, as it exceeded 12 months, at would require by the Statute of Frauds and section 96 of " The Companies Act, 1582," to be in writing. Up to the time ■when the company went into possession, neither by word or act had plaintiff in any way consented or assented to relieve defendants of the ' contract, and the breach (if there was a breach) was complete before he commenced to work for the company. There is evidence that Mr Stevenson has recogolsed his liability in the original agreement on at least two occasions since his- transfer to the company. On the 12th February, 1903, he WTOte to plamtiff, in reference to selling the factoj-y : *' I "wish you to ■•vrite a letter stating that you ar«- willing to continue your arrangements with me in favour of the for the balance of the term." And there is plaintiff's uncontradictsd evidence that after he received the letter of dismissal he saw 'Mr Stevenson, and they had a conversation about his dismissal, wizen Mr Stevenson said that after his return from Henley the halfyearly balance sheet wa3 befoie him, that he found he was loa'ng money, and determined i to make the first loss the lea3t, and further said : "Of course, I have a year to run with you yet; but you will have to see my solicitor. I 'See and come to some arrangement. Whatever it is, I'll fall in with it"; and added that he did not want to argue the point himself,, as his health would not admit of it. That goes clearly to show Mr Stcven&on up to that time recognised his liability under the agreement. As to damages, tlie breach took pl?ee about seven weeks after the term of 18 months commenced, "but the plaintiff was employed by the com- ' jpany, receiving the same pay up to March 0, . and sustained no pecuniary damage up to that date. It is alleged that he was then discharged j 1 mainly because he was incompetent to ruanu- ! facture aweetened condensed milk. Mr Stevenson said in his ev.dence that if he had been . competent to m'antifacture condensed milk his | services would have been retained by the compsny. Defendant admitted in cross-examina-tion that if ho could not manufacture sweetened condensed milk of marketable quality with proper appliances and materials he could not carry out what he undertook to do as a m.lk , condenser, and also admitted that he made five or six attempts at Henley, without success. | There was considerable evidence as to fcha ' cause of the failure, and some of the -excuses. 1 appear to me to be disproved ; but one matter stands out without evidence to disprove it. ' The fault in the manufacture was that it was | too thick, and was insoluble. The plaintiff { cays that the principal cause of that was that ! the pan at the factory was too large, and i unfit to deal with the quantitue3 of milk that , had to be operated on ; that the milk and sugar required to be biought to a heat of 212deg Fahr. to make a proper emulsion, and it was impossible to bring it to that heat in that pan without burning the material. Mr Stevenson, | when cross-exarnJied, would not undertake to j deny that the pan would burn the material at that heat. The p'.a.n tiff's evid3r.ee further •went t<3" show, in corroboration, that it was ' necessary to heat the material to 212deg that in a recipe for manufacturing condensed milk he supplied to Mr Stevenson before he entered j his employ, that it is shown that at a part of ! the process of manufacture the material must I be brought to a '" furious boil." He also j says that in a letter he wrote to Mr Steven- j eon he exp'.n ned the reason why he had cot j made sugared milk to be that he could not • raise it to a sufficient heat. A letter from J Mr Stevenson, dated December 15, says | ■tins- — "I have your explanation about i 'the sugared milk, which I now understand." i Unfoitunately the defendants have not pro- j duced the letter containing plaintiff's explana- ( tion, but Mr Stevenson says plaintiff made no complaint about the pan, and never did, but he was unable to say what was plaintiffs explanation that he said he understood. Mr Sevenson, under cross-examination, admitted that he had not doubted plaint. ffs competency • urtil lately, aid there is seme reason for Mr Finch's &ugge3uon that doubt did exist up to the time when plaintiff stipulated for a bonus if ho transferred his agreement for the balance of the teim to a company then expected to purchase the factory. On the whole, I am not satisfied it is proved th^ plaintiff is incompetent, or that that was the true reason for his losing employment by the company, and therefore I need not express any opinion of what ; effect it would have had on the question of j damages had it been proved. The plsimtiff was . paid up to March 9— that is to say, seven weeks ago— and ho has lost in v. nges from that time r.35,r .35, and to that must be added such further lo=s as he will sustain by the- breach up to tha end of the term. In Sowdon ~-. Malls (30 L.J., QB., p. 176), Blaekburne. J., said: "If aa action is brought by a servant for wrongful dismissal soon after the dismissal, the judge tells the jury that they must speculate on the fhar.ee of his gcttirg a new place, and ba. c tiieu fcuaw&t pa lb*t- li tkt aetegn is de-

layed till the man has got a place, what wsi4 matter of speculation before becomes certain then, and the jury ca'.calate accordingly." Tha agreement has 44 wests more to run, and iff has been pointed out that this is the off season, when factory employment such as plaintiff held is difficult to obtain, and there is, of course, an uncertainty that when plaintiff obtains employment he will command equally good wages. Onthe other hand, there is the possibility that he may get employment as a factory enginees in the slack season, and employment like tiiat at Henley factory -when the jeason commences in about Seuteuiber next. I think ii I add £65 to the wag"es he has already lost it will, as near as I can judge, cover the probable loss. Judgment for £100, costs of court (43s)j piofessional costs (£6).