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Damages for breach

Van Efferen v CMA Corporation Limited [2009] FCA 597

63. Although s 721(1) of the Act provides that a person who suffers loss or damage as a result of a breach of an AWA may recover that loss or damage in curial proceedings, the provision is silent as to the basis on which such loss and damage should be calculated. Mr Van Efferen submits that, because AWAs are statutory contracts, damages should be calculated as they would be in respect of any breach of contract. The applicant should be placed in the same situation, as far as money may do it, as if the contract had been performed: Commonwealth v Amann Aviation Pty Ltd (1991) 174 CLR 64 at 80(Mason CJ and Dawson J), 98-9 (Brennan J), 116 (Deane J) and 148 (Gaudron J). In appropriate cases damages could be calculated by reference to what the applicant was entitled to expect by way of performance by the respondent and the losses incurred when the respondent failed to comply with its contractual obligations: Amann Aviation, at 91-2.

64. Where an employer wrongfully terminates an employment contract which has a fixed term, thereby causing damage to an employee, damages are normally calculated on the basis that the employee would have enjoyed the benefits of the contract for the remainder of its term:  see Kilburn v Enzed Precision Products Pty Ltd (1988) 4 VIR 31 at 33Patterson v Middle Harbour Yacht Club (1996) 64 FCR 405 at 406Martin v Tasmanian Development and Resources (1999) 89 IR 98 at 120-1. The employee is under an obligation to mitigate his loss by seeking to obtain alternative remunerative employment. Although the AWA had a three year term, Mr Van Efferen only sought damages until CMA’s work on the Dolphin Project ceased.

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