A recent decision of the Full Federal Court handed down in February 2014 being Kilcran, in the matter of Allco Finance Group Limited (Receivers and Managers Appointed) (In Liquidation ) [2014] FCAFC 6, has upheld the decision of Justice Perram that the Receivers and Managers of the Allco Finance Group Limited (AFG) did not terminate the employment of Stephen Kilcran as the Head of Legal and Compliance and the appeal by Mr Kilcran was dismissed with costs.
The essential issue on which the claim by the Appellant was based related to an alleged conversation between one of the Receivers (Mr Gothard) and the Chief Executive Officer of an affiliate company of Allco Finance Group Limited being Allco SIF Ltd (SIF) which the Appellant claimed had the effect of terminating his employment which was then communicated to him by the Chief Executive Officer (Mr Mansveld). In rejecting the appeal, the Full Court found on a factual basis that it agreed with the trial judge's determination that he preferred Mr Gothard's recollection of the conversation to that of Mr Mansveld and agreed with the trial judge that the Appellant had in fact resigned his employment in December 2008 and was not entitled to any termination benefits in the form of payment in lieu of notice, bonus payments or redundancy payments as described in the proof of debt which he had lodged with the Receivers.
In regard to the applicable legal principles the Full Court held that Mr Mansveld's authority was of no particular significance given that all the parties knew that the Receivers were empowered to make decisions in relation to the employment of employees of AFG and that Mr Mansveld was authorised only to pass on what the Receivers said and no more and no less. Further, in relation to the Appellant's claim alleging repudiation of his employment contract and constructive dismissal, the Court following a review of the authorities and in particular Thomson v Orica Australia Pty Ltd (2002) 116 IR 186 held that there was no basis on which it could be found that the Receivers engaged in conduct likely to damage or destroy the employment relationship. Accordingly the claim for either repudiation or constructive dismissal failed.
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