Downie v John and Norma Waite trading as Suncoast Caravan Services [1997] QIRC 93 (1997) 154 QGIG 1030

1030 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 27 March, 1997 ########################################################## QUEENSLAND INDUSTRIAL RELATIONS COMMISSION Industrial Relations Act /990 s. 295 application for reinstatement Donald James Downie AND John and Norma Waite trading as Suncoast Caravan Services (No. B1437 of1996) CHIEF INDUSTRIAL COMMISSIONER HALL 13 March 1997 Application for Reinstatement Misleading Representation About Capacity - Inadequate Performance - Warning Request for Lengthy Adjustment Period Dismissal No Unfairness - Application Dismissed. Application for Costs Unsatisfactory Conduct of Trial hy Respondents Application Dismissed. DECISION Good fortune has not smiled upon the applicant Over a three year period each of two of his sons died at his Melbourne residence in tragic circumstances !\ot surprisingly the applicant developed an interest in changing his life and putting memory behind him. In 1995 he an<l his wife drove from Melbourne to Caloundra and back to Melbourne, exploring the possibilities of gaining employment and/or purchasing a business at the various provincial centres through which they drove. They concluded that prospects were bleak and decided to remain in Melbourne. Each of them, I should say, held a secure job of long standing. The applicant had been employed by the manufacturer of Jayco Caravans for 19 years. His wife had been employed by Coles for 20 years. In or about February of 1996 the applicant came into contact with Mr John Waite. Mr John Waite, I should say, is with his wife Nonna and his son David a member of the partnership which trades as Suncoast Caravan Services at Maroochydorc. (I note that the application has been brought against two partners only.) The circumstances of that contact were ordinary 27 March, 1997 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 1031 enough At the time the applicant was the national warranty mana_ger and customer relations manager for Jayco Caravans._ A purchaser resident m Maroochydore became upset when asked to take his caravan to an authonsed repairer in Caloundra. The purchaser so~ght perm1ss1on to_t~ke the van to Suncoast Caravan Services. The applicant made enqumes about the busine,s which ultimately led, not only to the purchaser taking his van to Suncoast Caravan Services, but to Suncoast Caravan Services being appointed as an authorised repairer of Jayco caravans. In the process the applicant had a number of telephone conversations with _Mr Waite: and telephone conversations in the ordmary course of busmess contmued thereafter. In March 1996, in the course of a telephone conversation, Mr Waite made comments from which the applicant inferred that there might be a vacancy at Suncoast Caravan Services, and made a remark to the effect that the applicant was the sort of person for whom Suncoast Caravan Services was looking_ The applicant suhsequently (on the same day) telephoned Mr Waite, and enquired if he was serious. When Mr Waite confinned that he was serious, the applicant booked an airline flight to Maroochydore He was met at the airport by John Waite just prior to midday on a Friday and wa" taken by him to the business premises of Suncoast Caravan Services. The applicant was shown over the premises and, in particular, shown the spare parts showroom. Mr Waite then introduced the applicant to a real estate agent who showed him the type of permanent rental accommodation which was available. The applicant stayed at the home of Mr and Mrs Waite until Sunday when he returned to Meloourne. It is accepted that there were conversations between Mr and Mrs Waite and the applicant and indeed between the applicant and David Waite on the Friday and the Saturday night, and that on the Saturday morning the applicant paid a further visit to the husiness premises of Suncoast Caravan Services. When the applicant left Marnochydore airport on the Sunday he did so as a party to an agreement with the Waites that, subject to the consent of his wife, he would accept a position with the firm. l interpolate that I am satisfied that the applicant made plain to the Waites that his wife and himself would be giving up secure and long term employment to come to Queensland. Some short time after his return to Melbourne Mr Downie telephoned Mr Waite and informed him that Mrs Downie was prepared to come to Queensland and confirmed the engagement. Mr and Mrs Downie arrived in Maroochydore in July of 1996. Mr Downie commenced work at the premises of Suncoast Caravan Services on 15 July 1996. On 26 July 1996 Mr Downie wa<; dismissed. Mr O'Brien who appeared for the respondents has made a savage attack on Mr Downie. He accuses him of fraud, of intentionally misleading the respondents and of mendacity. I consider that criticism to go too far. Materially, Mr Downie made each of the two representations to the resixmdents First, he told them that he had 19 years experience in the caravan industry. That representation was entirely correct. It reflects not at all on Mr Downie that Mr Waite made assumptions about the abilities which a person with 19 years experience would necessarily have. And Mr Waite did make such assumptions. Even at the trial he answered queries raised in cross examination by observing that a person with 19 years experience in the industry should have been capable of doing something or should have known something. It seems to have occurred to him not at all that a person with 19 years experience at the head office of a particular manufacturer might experience difficulty in adjusting to a shopfront operation, dealing with lay- folk rather than experienced operators within the industry and dealing with a wide range of parts relating to caravans which were the product of a number of manufacturers. Second, Mr Downie told Mr Waite that he would find the position at Suncoast Caravan Services "a piece of cake". I have anxiously considered whether that representation should be regarded as a mere puff On balance I do not think it can be so regarded. Mr Downie was in the witness box for some considerable period. He docs not emulate the language of an Oxford Don. On oath and knowing that the matter was serious, he answered questions by using expressions comparable to a ''piece of cake" There is evidence of Mr John Waite, which I accept, that he took the representation seriously_ Indeed, it so stuck in his mind that he was able to give evidence of the remark at the trial. In my view the expression was more than a prediction. It was an implied representation that the applicant had the ability and experience to perform the work Mr Downie knew what Mr Waite did not. Mr Downie knew the detail of his work. experience in the caravan industry. He knew that during the substantial period that he was the stores manager and purchasing officer for Jayco Caravans, he was concerned with assembled components, e.g. doors. and not with the parts which were used in the construction of the large component. When he had need of such a part he obtained it from those employees of Jayco who operated the spare parts division in another building. He knew that over the substantial period when he was the service manager with responsibility for dealing with quotes, he was involved in paper transactions and had little or no physical contact with spare parts. He knew that his experience was limited to Jayco Caravans and that his only contact with other caravans was once a year at a caravan show. In my view if Mr Downie had thought about it at all, he should have realised that he might encounter difficulties in making the transition to Suncoast Caravan Services. In evidence at the trial he said: "The spare parts side of it I wasn't overly au fait with but I thought I knew enough about caravan spare parts to be able to make a success ofit". He did not tell that to Mr Waite. What he told Mr Waite was that he considered the position would be "a piece of cake". In my view that representation was misleading a~ to the future in the sense in which that word is used ins. 5 lA of the Trade Practices Act 1974 and s. 37 (I) of the Fair TradinR Act 1989, and misleading as to Mr Downie's true ability and experience. He did not have reasonable grounds for making the representation. But that is not fraud. "[F]raud is proved when it is shewn that a false representation has been made: (I) knowingly, or (2) without belief in its truth, or (3) recklessly, careless whether it be true or false.". Derry v Peek (1889) 14 App. Cas 337 at 374 per Lord Herschell. Carelessness is not enough. Even gross negligence will not suffice unless the defendant is consciously indifferent to the truth, Lamb v Johnson (1914) 15 SR (NSW) 65, at 74-75. Given that the gravity of the issue calls for the clearest persuasion, even if on halance of probability, see Re1fek v McF/ory ( 1965) 112 CLR 517 I am quite unable to conclude that Mr Downie consciously shut his eyes to the facts. The conclusion that the representation was not fraudulent makes it unnecessary to consider whether the common law right to rescind a contract of employment for fraud survives Division 5 of Part 12 of the Industrial Relations Act 1990. Rescission for non-fraudulent misrepresentation was of course a creature of the Court of Chancery, which had nothing to do with litigation concerning contracts of employment. Determining the adequacy or inadequacy of Mr Downie's performance and the level of his competence, has caused me great anguish. The difficulty has arisen because the partners have sought to exaggerate and to embellish their evidence. To take two examples Mr John Waite was asked to give instances on the basis of which he had come to the conclusion that Mr Downie's knowledge of spare palts and accessories was limited. He took a case in which Mr Downie had sold a winder box to a customer. The initial complaint was that left hand winder boxes and right hand winder boxes are not interchangeable and that Mr Downie did not ask the customer which wmder box was required. Pressed in cross examination to the point at which he admitted that he might not have overheard the whole of the conversation and that in fact Mr Downie had supplied the customer the correct winder box, the criticism changed. It was said that because the containers for the left hand winder boxes and the right hand winder boxes were in the public part of the shop and members of the public handled the boxes, one could not assume that winder ooxes were in the correct container. It was said that Mr Downie had simply taken a winder box from a container without checking to ensure that there was a winder box of the right type. That in itself is a fair criticism. Indeed, I would have thought that if Mr Waite and Mr Downie had dwelt at all upon the difficulties of moving from a manufacturer's head office to a shopfront operation, they would have identified the matter as the sort of thing which Mr Waite would need to draw to Mr Downie' s attention. But it was a e0mplaint developed at the trial. The second example concerns a quotation which Mr David Waite, who conducted the repair side of the business, had given to Mr Downie in order that it might be put into proper form. The initial criticism was that the product of Mr Downie's labour showed that he did not understand the difference between "remove and refit" and "remove and replace" It was then said that the consequence would be that those reading the quotation would form an incorrect view of the components which were to be removed and then refitted (perhaps after repair) and the components which, after removal, were to be replaced with new parts. When it was pointed out that no reasonable person could have made that error because the product of Mr Downie' s labours specified the new parts to be supplied, once again the criticism changed. The first new criticism wa~ that loss assessors are particular about the use of the expressions "remove and refit" and "remove and replace" and would have complained about Mr Downie's document. Once again. that seems to me to be a fair criticism. And it was obviously important for Suncoast Caravan Services to be on good terms with insurance companies. But it was not the original criticism. As the evidence went on, additional complaints were made. Mr David Waite complains that the document was not a copy of hi~ draft. That is so Amongst other things it gives the name and address of the customer, which the draft did not. If the complaint is that the body of the document is different, one must bear in mind that in a written witness statement Mrs Norma Waite said that Mr Downie's job was to "write up" quotations. Mrs Waite added a further criticism. She complained of the handwriting She asserted the document looked as if it had been written by three people, and that the reason for that was that Mr Downie had mood swings. No useful 22725_1.DOC -- 1 of 2 -- 1032 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 27 March, 1997 purpose will be achieved by giving further examples. It is plain that the partners are prepared to say that which they think will damage Mr Downie's case That said, the instance~ of inadequate performance to which the partners referred did contain elements of truth. Indeed in most cases Mr Downie could recollect the incident though his recollection was different. Minor though some of the incidents were and carping though the criticism has been on occasion, the frequency and volume of incidents were such that I can understand that the partners came to lack confidence in Mr Downie Once the partners came to lack confidence in Mr Downie, he had no role. The partners had no need of a shop assistant. \fr Downie had not been employed to be a shop assistant. He had been employed to perform the work previously performed by Mr John Waite so that Mr Waite. who was in poor health, might limit his involvement with Suncoast Caravan Services. So optimistic were the parties to begin with that when Mr Downie arrived on the fifteenth, he was allocated Mr Waite·~ desk. He cleaned it off. But by the end of the week all of the optimism was gone. On the following Monday, 22 July 1996, Mr Downie noticed that Mr John Waite was acting coolly towards him. He asked Mr Waite: "How am I gomg'I" There is some conflict in the evidence as to what was said, but it i~ plain that Mr John Waite made it clear to Mr Downie that he was greatly dissatisfied with his performance and that if it did not improve his services would be brought to an end. Mr Downie did not seek pa11iculars of the dissatisfaction nor did he seek to defend himself He asked for a six month period to famihanse himself with rhe activities of Suncoast Caravan Services and to master the work required of him. Given that the answer was by way of response to a warning that Mr Downie· s employment was in jeopardy because he lacked the capabilities on the basis of which Mr John Waite had employed him and his performance was madequate. Mr John Waite was entitled to treat that answer seriously. There is no evidence hcfore me of the financial position of Suncoast Caravan Services. However. it seems to me that even if the partnership might have carried Mr Downie through a six month settling in period, it was perfectly entitled ro decide not to do so. Mr Downie had been engaged on the basis that he could perform the work, not on the basis that he might he trained ro do it Mr Downie's employment was terminated on Friday 26 July 1996. There is some dispute as to whether he asked again fo, a ~ix month :,ettling in period or reduced the period to six weeks. On either view it seems to me that the period was too long and that the partners did have a valid reason related to the operational requirements of the business to terminate Mr Downie' s services. Mr Downie cannot complain that he was given no adequate opportunity to defond himself against the criticisms made of his capacity an<l performance. He was. He did not take it. He opted to confess and avoid by seeking an extended settling in period. Doubtless, the dismissal has been yet another blow to Mr Downie. However. Mr Downie's personal difficulties do not insulate him from dismissal. He has the same guarantee against harshnes:,, injustice and unreasonableness as is given lo every employee bys. 291 (2)(a). Herc, I cannot sec any basis for concluding that tht'. dismissal was harsh, unjust, or unreasonable. The truth is that by his determination to come to Queensland and by his misrepresentation. Mr Downie was the author of his own undoing. I di~miss the application for reinstatement and/or compensation. The respondents seek costs. I have in Iskandn v Bri.1bane Dispiav and Shopfittinx Pty Lid 154 QGIG 806 at 809-810, developed in some detail my view of the correct approach to the power to award costs at s. 106 of the Act. No useful purpose will be served by covering the same ground here. It is sufficient to say that in my view 111 the present case two matters are of particular ~ignificance. One, a case is not frivolous because it is lost. It seems to me that this is not the category of case which persons of slender means ought to be deterred from litigating from a fear that they may have to meet the cost of the respondent as well as their own costs. Two. the reason that this matter took as long as 1t did 4 days instead of the 2 days estimated at the callover is becau;;;e of the exaggeration and embellishment Indeed. at an early stage in the proceedings a half hearted attempt was launched to establish that Mr Downie was a casual employee Mr Scott who appeared fur the applicant was constantly compelled to chase hairs and lay spectres lo rest. In all of those circumstances I consider that it would be inappropriate to award costs to the respondent. I dismiss the application for costs. Dated this thirteenth day of March, 1997. D R. HALL, Chief Industrial Commissioner. Appearam·es:- Mr G.W. Scott of Klooge1 Phillips & Co (Solicitors) for the applicant. Mr PJ O'Brien instructed by Adrian Carroll & Associates for the respondent. Operative Date. NIA Decision Application Dismissed. Released: 14 March 1997 ########################################################## -- 2 of 2 --