Respondent’s acceptance of this suggestion did not give rise to a contract binding on the parties. The words
“with the option of a minority partnership thereafter, on a 20/30/50% basis as between you, my wife, and myself, if we both
feel that our association should continue,”
are contrary to any intention on the part of the offeror to be bound . What is in contemplation is that if after two years of trial the parties wished to continue their association, 20% of the shares would
be conferred on the Respondent. An undertaking or promise, such as this which remains in the discretion of the parties or either
of them, cannot be binding.
The very structure of the arrangement indicates that the initial two-year employment contract was to be a probationary period, and
that the shares would be transferred only if the parties were then agreed that the respondent would be admitted as a shareholder.
Clearly the parties were at that stage, that is, at the end of the two years, not in agreement that they suited each other. Bagshaw’s
letter that gave rise to complaint “c” is clear indication of his negative assessment of the situation. This being so
he was not obliged at that stage to admit the respondent as a shareholder and his failure to do so does not constitute a breach of
It must also be born in mind that any contract for the transfer of shares to the respondent whether for consideration or not, involved
the shareholders, Bagshaw and his wife, and did not create any obligation on the part of the appellant. Even though Bagshaw controlled
and was the alter ego of the company, the difference and separation between the company and its shareholders cannot be completely
overlooked. Any breach of contract that there may have been would have given the respondent rights against the Bagshaws personally,
but not against the appellant. It follows that any such breach would not have been conduct on the part of the appellant as employer
that made continued employment impossible.
The court correctly found that complaint “b” justified and that the appellant had indeed miscalculated the bonus to the
disadvantage of respondent. The court also found that if anything this was a genuine mistake based on a misreading or misinterpretation
of the contract. This mistake is capable of monetary adjustment and cannot be construed as repudiation of the contract or in itself,
or as conduct on the part of the employer, leaving the respondent with no other course but to sever his relationship so as to constitute
an unfair dismissal.
Complaint “c” came as an afterthought. The strictures and criticism of respondent and what were said to be his shortcomings
may have been harshly expressed. On the other hand Bagshaw’s letter, is on the whole conciliatory. This complaint even if the
strictures were not fully justified does not constitute in itself, or taken in conjunction with the other complaints, constitute
conduct contemplated in Section 37.
For these reasons the court a quo misdirected itself in regard to the application of Section 37 and its judgment in this respect is to be reversed. This does not affect
the judgment or order of the court a quo as far as order 4 and 5 is concerned. To this extent the appeal succeeds and orders 1,2 and 3 are set aside.