Burch v Willoughby Consultants Ltd (1990) 3 NZELC 97,582 is a cited case in
New Zealand regarding the remedy of
damages for
mental distress under the
Contractual Remedies Act (1979) for
breach of contract
Breach of contract is a legal cause of action and a type of civil wrong, in which a binding agreement or bargained-for exchange is not honored by one or more of the parties to the contract by non-performance or interference with the other party ...
.
Background
Robert Burch was a chartered accountant nearing the retirement age of 65. Unhappy at the prospect of facing his final years before retiring working for an accountancy firm, he accepted an offer of employment in 1982 by one of his clients, Willoughby Consultants Ltd.
The
employment contract
An employment contract or contract of employment is a kind of contract used in labour law to attribute rights and responsibilities between parties to a bargain.
The contract is between an "employee" and an "employer". It has arisen out of the old ...
guaranteed Burch employment until his 65th birthday, plus 1,000
shares
In financial markets, a share is a unit of equity ownership in the capital stock of a corporation, and can refer to units of mutual funds, limited partnerships, and real estate investment trusts. Share capital refers to all of the shares of an ...
in the company.
However, just over two years later,
A C Nielson purchased the company, and did not want to employ someone aged in their sixties. As a result, the following day of the sale, Willoughby Consultants informed Burch that they were terminating his employment, with three months' notice.
After working out his notice, he sued Willoughby Consultants for the loss of benefits that he would have attained had his employment continued until he turned 65. He also sued for damages under the Contractual Remedies Act (1979).
Willoughby Consultants defended matter by claiming they were entitled to
terminate his employment alleging he was involved in a dishonest transaction at work and that he
sexually harassed some of his fellow female employees, although Willoughby Consultants only first mentioned these matters after the
court action
A legal case is in a general sense a dispute between opposing parties which may be resolved by a court, or by some equivalent legal process. A legal case is typically based on either civil or criminal law. In most legal cases there are one or mor ...
had commenced.
Held
The judge did not find any evidence to support Willoughby Consultants claim of
misconduct, and in fact none of their witnesses they called were able to cite even one incident to support these claims. Accordingly, Willoughby was awarded damages of $100,000 for the loss of benefits he would have attained had he been employed the 3 years and 199 days until he turned 65. The judge also awarded $10,000 in damages under section 9 of the Contractual Remedies Act (1979).
References
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High Court of New Zealand cases
New Zealand contract case law
1989 in case law
1989 in New Zealand law