Sam's Fukuyama Food Services Limited v Zhang

IN THE COURT OF APPEAL OF NEW ZEALAND

CA325/2011
[2011] NZCA 464

BETWEEN SAM'S FUKUYAMA FOOD SERVICES LIMITED
Applicant

AND JIAN ZHANG
Respondent

Hearing: 13 September 2011

Court: O'Regan P, Harrison and Stevens JJ

Counsel: S C Dench for Applicant
G M Pollak for Respondent

Judgment: 19 September 2011 at 3.00 pm

JUDGMENT OF THE COURT

Leave to appeal is granted on the following question of law:

Whether the Judge in the Employment Court failed to exercise the discretionary power in s 128(3) of the Employment Relations Act 2000 when awarding compensation for remuneration lost by the employee and, if so, what is the appropriate sum payable to the employee in the exercise of such discretion?

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REASONS OF THE COURT

(Given by Stevens J)

Introduction

At the conclusion of the hearing of the application for leave to argue a question of law under s 214 of the Employment Relations Act 2000 (the Act), we advised the parties that we proposed to grant leave on the question of law set out above.
In order to minimise the costs to the parties in respect of the appeal, counsel agreed that the substantive appeal could be dealt with on the papers. To assist the Court further, and to provide any submissions additional to those canvassed in argument at the hearing, counsel will each provide further written submissions of not more than three pages. Such submissions will be directed to the factors that ought to be considered in the exercise of the discretion under s 128(3) of the Act to award a sum greater than an amount equal to three months ordinary time remuneration as provided in s 128(2) of the Act.
The applicant is to file and serve its submissions by 4 October 2011 with the respondent to answer by 11 October 2011. There is no provision for a reply by the applicant.
As discussed at the hearing, the parties are encouraged to endeavour to resolve their differences by agreement. But if the parties have not otherwise resolved the amount of remuneration in excess of three months ordinary time remuneration payable to the applicant, a judgment fixing the amount payable will be issued by the Court.

Solicitors:
M J Burney, Auckland for Applicant

CaseChat Overview and Summary

The Court of Appeal of New Zealand heard an appeal by Sam's Fukuyama Food Services Limited against a decision made by the Employment Court regarding compensation for lost remuneration. The appeal sought clarification on whether the Employment Court had correctly exercised its discretion under section 128(3) of the Employment Relations Act 2000 when awarding compensation for lost remuneration to the employee, Jian Zhang. The primary question before the Court was whether the Employment Court had erred in its discretionary assessment and, if so, what the appropriate sum payable should be. The Court of Appeal granted leave to appeal on this specific question of law.

The legal issue before the Court of Appeal was whether the Employment Court had properly exercised its discretion under section 128(3) of the Employment Relations Act 2000. This section allows for the award of a sum greater than three months' ordinary time remuneration to an employee dismissed without cause or notice, provided certain conditions are met. The Court had to determine if the Employment Court had correctly applied the statutory criteria and exercised its discretion appropriately. The appeal raised questions about the factors the Employment Court should consider when determining the appropriate sum to be awarded under this section.

The Court of Appeal, while granting leave to appeal, indicated that the substantive appeal would be dealt with on the papers. To streamline the process and reduce costs, the Court requested additional written submissions from both parties, focusing on the factors relevant to the exercise of the discretion under section 128(3) of the Act. The Court encouraged the parties to attempt to resolve their differences by agreement, with the possibility of a judgment being issued if they failed to reach an agreement. This approach aimed to balance the interests of both parties and ensure a just resolution of the compensation amount.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established