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High Court of Fiji |
IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION
CIVIL ACTION NO HBC0593 OF 1999
Between:
JOHN THOMAS
Plaintiff
and
SUVA CITY COUNCIL
Defendant
Mr. A. Herman for the Plaintiff
Ms. T. Waqanika for the Defendant
Date of Judgment: 25 November 2005
JUDGMENT
By writ of summons dated 15 December 1999 the plaintiff is seeking damages for alleged wrongful dismissal, interest and costs against the defendant Suva City Council (the ‘SCC’).
The plaintiff was summarily dismissed by SCC on 28 August 1998.
Background facts
The Plaintiff was employed by Suva City Council as Director Administration and Operations. [Exhibit P 1]
SCC is a body corporate established under the Local Government Act (Cap 125).
The Plaintiff was recruited by SCC as a Cadet Engineer on /or about 14th of February 1974.
The Plaintiff applied for the position of Director Administration and Operation with SCC in about March 1997 and was successful.
SCC issued a formal letter of appointment (referred to as “letter of appointment”) to the Plaintiff on 15th September 1997. The Plaintiff accepted the appointment on 16th September 1997 [Exhibit P 5].
On 19th November 1997 he received a letter of appreciation from SCC
[P 7].
The letter of appointment states that all terms and conditions not covered in the letter of appointment would be covered in the agreement between Suva City Council and Suva City Staff Association (referred to as “the Master Agreement”).
There are no terms relating to termination or discipline in the letter of appointment. That at all material times the Master agreement contained the terms for termination or discipline of employees including the Plaintiff.
Section VI, Clause 16 of the Master Agreement contains the requirements for disciplinary proceedings.
Section VI, Clause 17 of the Master Agreement contains guidelines for the resolution of grievances or disputes.
The plaintiff’s evidence
The plaintiff’s evidence has been well summarized in the counsel’s written submission and I can do no better than produce it hereunder:
The Plaintiff had been employed by the Defendant for 24 years and rose the ranks from Cadet Engineer to Director Administration and Operations. He is currently unemployed, and is married with three children.
The Plaintiff has a Diploma in Building and Civil Engineering and a Bachelor of Arts in Economics and Management.
The Plaintiff’s 24 year career with the Defendant ceased on the 25th of August 1998 when the Defendant at an Emergency Council Meeting resolved that the Plaintiff be given 24 hours to resign. The letter did not contain any reasons for the same [Exhibit P 12].
The Defendant gave evidence that although he was present at the meeting on the 25th of August 1998, it was resolved that all officers (including the Plaintiff) leave the Council Chamber during the discussion of item 8 on the agenda entitled “Director Administration and Operations Case”.
It was further stated by the Plaintiff that he did not know what was to transpire behind closed doors by the Defendant, nor was he given an opportunity by the Defendant to be present whilst they discussed what seemed to be an item that concerned the Plaintiff.
It was further stated by the Plaintiff in evidence that he was not given an opportunity to be heard by the Defendant before it made a decision that turned out to be first of all a request for him to resign [Exhibit P 8] and secondly his summary dismissal [Exhibit P 12].
This is corroborated by the Plaintiff’s second witness, Mr. Paul Sloan, that the Plaintiff was not present when the Defendant, including himself as a Councillor deliberated upon the Plaintiff’s fate and was therefore not given an opportunity to be heard.
There was widespread Media Publicity of the Plaintiff’s dismissal by the Defendant. [Exhibits P 9, P 10, P 27, P 28, P 29, P 30, P 31, P 32, P 33, P 34, P 35].
As a direct result of the Defendant’s action in summarily dismissing the Plaintiff and his inability to find alternative full time paid employment, the Plaintiff suffered losses which were led in verbal as well as documentary evidence [Exhibit P 37] and are particularised more specifically in the Schedule of Damages attached to the submissions herein.
The Plaintiff did his utmost to prevent losses he suffered and also to mitigate that which he did suffer by aggressively attempting to find alternative employment but was unsuccessful due largely to the stigma caused by the subject matter of these proceedings. [Exhibit P 36 – Separate Bundle of Documents containing Plaintiff Job Applications between the period October 1998 to March 2004].
Plaintiff’s submission
The learned counsel for the plaintiff submits that the dismissal was ‘unlawful/unfair’ when the defendant sought his resignation without giving any reasons and then summarily dismissing him.
He submitted that the defendant admitted liability in its own Minutes of 16 October 2003 where it is stated:
“...It was further noted that Council did not follow proper procedures when terminating the services of Mr. John Thomas. A member raised his concern and stated that in the future, Council must be careful and follow proper procedures when intending to terminate the services of its employee” [Exhibit P 38].
The plaintiff was governed by his letter of appointment dated 15 September 1997 and the Collective Agreement (the ‘Agreement’) dated 17 August 1979. This is an agreed fact in the Pre-trial Conference Minutes of 22 October 2002.
Counsel makes the point that the defendant failed to comply with the Collective Agreement, inter alia, in particular Section VI Clause 16(a) (Page 17 of Exhibit P6) which required the defendant to issue 3 warning letters before it was entitled to invoke the summary dismissal provisions of Section VI.
He said that the first warning dated 5 December 1997 was withdrawn as admitted by the witness Town Clerk Verenakadavu. The second warning being memorandum dated 19 December 1997 purported to issue a warning. This should have been done after conducting an investigation in terms of the Agreement. It is an undisputed fact that there was no such investigation and therefore the said memorandum purporting to be a warning against the plaintiff was in fact unlawful/invalid. Further the memorandum of 5 February 1998 was not a warning but a caution as conceded by Verenakadavu.
Counsel submits that the summary dismissal was unlawful in that there was a denial of natural justice as the plaintiff was to have been afforded an opportunity of being heard especially when the defendant did not have the right to dismiss without cause. In this case an emergency meeting was convened; SCC had a closed meeting and resolved to request the plaintiff to resign within 24 hours without stating any reasons why he should do so. Also, the procedure under the Agreement was not followed and hence the purported warning was unlawful.
The learned counsel for the plaintiff submits that prior to any disciplinary action, the plaintiff had to be given the opportunity to respond to allegations against him and his explanation had to be considered.
Defendant’s submission
The learned counsel for the defendant has made written submissions. She stated that reasons for summary dismissal were given in the termination letter of 28 August 1998.
On the defendant’s terms and conditions of employment counsel submitted as follows:
The Plaintiff on his appointment as the Director Administration & Operations on 15th September, 1997, his terms and conditions of employment was governed by the Agreement between the SCC & the Staff Association. Letter of appointment shown on “D1” of the Defendant’s submission.
Subsequently, a memo dated 11th March, 1998 from the Acting Town Clerk to the Plaintiff – “D 4”, stated that the Plaintiff was no longer considered to be a member of the Staff Association.
A letter dated 1st April, 1998 from the Plaintiff and other Senior Staff of Council informing the Union that they ceased to be members of the Association – “D 5”.
After the Plaintiff ceased to be a member of the Staff Association, no further agreement was signed up between the Plaintiff and the Defendant.
However, the Defendant submits that despite the Plaintiff being excluded as a member of the Association, the terms and conditions of his contract is still governed under the Agreement between the SCC and the Staff Association.
Section VI, cl 15 (e)! of the Agreement between the SCC & Association is the summarily dismissal section which allows an employer to summarily dismiss an employee under the following circumstances:
Counsel further submitted that the actions of the plaintiff were a series of events which warranted summary dismissal. In this regard she referred to a number of instances as stated in the termination letter.
She says that procedural fairness was accorded the plaintiff prior to being summarily dismissed.
Counsel submits that the plaintiff was written to on 20 August 1998 requesting explanations on ‘mismanagement and negligence’ on his part to which the plaintiff responded on 24 August 1998. These letters were tabled at the Emergency Meeting of the Council on 24 August. The Council after deliberating on the matter resolved that various officers of the Council be disciplined and that the plaintiff be summarily dismissed.
As far as the plaintiff’s claim for damages is concerned, counsel says that the plaintiff is not entitled to any damages as reasons were given and procedural fairness was accorded. However, she said, that ‘should the court find that the dismissal was unjustifiable, it is submitted that the plaintiff is only entitled to the salary that he would have earned had he worked during the period of notice to which he was entitled to’.
The issues for determination
The issues for Court’s determination are as follows:
. Was the conduct of the Plaintiff sufficiently serious to justify dismissal?
. Was ‘Procedural fairness accorded to the plaintiff prior to his summary dismissal.
Consideration of the issues
I have considered the written submissions from both counsel and the evidence adduced in this case.
Evidence for the plaintiff was given by the plaintiff himself and Paul Sloan (a Suva City Councillor). For the defendant the Town Clerk Ilitomasi Verenakadavu testified.
(a) First issue – what are the terms and conditions of employment of the plaintiff?
Although the plaintiff was recruited as a Cadet Engineer on 14 February 1974, he was appointed to the post of Director Administration and Operations on 16 September 1997 (exhibit 1). He was on this post for about 11½ months when he was dismissed summarily on 28 August 1998.
The exhibit I sets out some terms of the contract but it states that other Terms and Conditions of Employment ‘would be applicable as per agreement between the Suva City Council and Suva City Council Staff Association (the ‘agreement’).
The plaintiff accepted the offer of appointment by signing it.
The plaintiff’s salary at the time of appointment was $42,000.00 per annum in Grade 2 in the Salary scale $41,025 to $55,505.
However, the letter of 11 March 1998 (exhibit 4) makes it clear that as from 13 February 1998 the plaintiff is excluded from the category of employees which the Counsel Staff Association can represent in relation to industrial or other employment issues.
I agree with Counsel for the defendant that despite the plaintiff being excluded as a member of the S.C.C. Staff Association ‘the terms and conditions of his contract is still governed under the Agreement between the SCC and the Staff Association’. She then referred to the summary dismissal clause referred to hereabove.
In this case one is particularly concerned with Section VI of the agreement which deals with ‘Disciplinary Proceedings’.
Clause 16(a) is a general clause which states, inter alia:
“Employment is conditional on the employee continuing to render satisfactory service. An employee failing in this respect or committing a breach of discipline may have his employment terminated or be liable for such lessor penalty as hereinafter provided.”
Clause 16(c) states, inter alia, that “after due investigation ... a formal warning may be administered” and “on the commission of the third offence and where an employee has already had two such warnings he or she may be liable to disciplinary action under Clause (e) of Section VI of the Master Agreement”.
Clause 16(e) deals with ‘dismissal’. It provides, inter alia, that:
“The employer will not dismiss an employee summarily except in the following circumstances:-
(i) Where an employee is guilty of misconduct inconsistent with the fulfilment of the express or implied conditions of his contract of service.”
Based on what I have stated hereabove, on the first issue for Court’s determination, I find that the plaintiff was governed by his letter of appointment which he signed and the Agreement.
If I am held wrong on the applicability of the agreement to the plaintiff, it is still open to the employer to summarily dismiss an employee in the absence of termination clause in the said letter of appointment in this case. The employer can use the same circumstance for dismissing as in section VI Cl. 15(e) which provides, inter alia, ‘where an employee is guilty of misconduct inconsistent with fulfilment of the express or implied conditions of his contract’.
Was the Plaintiff’s summary dismissal justifiable?
The plaintiff’s employment on this post began on 16 September 1997. The first dissatisfaction in regard to performance of his duties can be gathered from the ‘warning’ letter of 19 December 1997 (exhibit 2).
By another letter dated 20 August 1998 (exhibit 7) the Town Clerk Verekadavu wrote to the plaintiff pointing out incidents which exemplify mismanagement and negligence on his part and asking him to submit his explanations on these incidents not later than 9.00 a.m. on Monday 24 August 1998.
The plaintiff replied to the said letter on 24 August 1998 (exhibit 8). To this the Town Clerk replied to the plaintiff on 25 August 1998 (exhibit 9).
By letter dated 26 August 1998 the plaintiff was asked to hand in his resignation within 24 hours of receipt by him of this letter. This was the resolution of the S.C.C. Emergency Council Meeting held on 25 August 1998.
Not having resigned, the plaintiff was given a termination of appointment letter (exhibit 12) summarily dismissing him from the Suva City Council and the reasons for dismissal were given in the said letter.
The circumstances under which the plaintiff was dismissed have been set out briefly hereabove.
The question is whether procedural fairness was accorded him.
The answer is in the affirmative. The Plaintiff was left to be governed by his letter of appointment, and the said clauses of Section VI of the agreement referred to hereabove.
As can be seen the allegations of mismanagement was put to him in considerable detail to which the plaintiff replied.
He was given the opportunity to explain. This reply was considered by S.C.C. but the Council was not satisfied so it decided to terminate him after giving him a letter requiring him to resign which he chose not to do.
After he was dismissed on 28 August 1998, he instituted the present proceedings by writ of summons over eleven and a half months later on 15 December 1999.
Conclusion
On the evidence adduced in this case, I find that the defendant as an employer of the plaintiff was justified in summarily dismissing the plaintiff.
I find on the civil standard of proof that on the evidence and for the reasons given by the employer as stated hereabove the conduct of the plaintiff was sufficiently serious to justify dismissal.
As can be seen in this case the plaintiff committed three serious breaches in the eyes of his employer within a space of a short period. The breaches were in regard to purchase of parking meters from Labasa Town Council – April to June 1998, Market Mall Kiosk – August 1998 and Cleaning of Civic Tower. After seeing the plaintiff’s explanation it resulted in the employer resolving that the plaintiff be summarily dismissed from employment.
Law
The question that arises is whether the termination was in accordance with the law.
The requirement that an employer deals fairly with the employee in an employment relationship is a Constitutional requirement (above) and under the rules of common law in Fiji.
Although in Mallock v Aberdeen Corporation [1971] 1 WLR 1578 at 1581 Lord Reid has said that “employee who may be dismissed without cause is not entitled to demand reasons from his employer, nor in the ordinary course, is he entitled to a hearing or any of the normal incidents of natural justice”, the Supreme Court in the case of Central Manufacturing Company Limited v Yashni Kant (Civil Appeal No. CBV0010 of 2002) said:
“that there is an implied term in the modern contract of employment that requires an employer to deal fairly with an employee, even in the context of dismissal. Each case must depend upon its own particular facts.” (emphasis mine)
Along with this, one needs to be reasonable when exercising the functions of terminating a contract. Hence there would not only be questions of substance required to be determined but those of procedure as well. Chitty on Contracts. Volume II “Special Contracts” 2004 states that the issue of fairness depends upon whether the tribunal is satisfied that in the circumstances the employer acted reasonably in treating the reason shown to him as sufficient reason for dismissing the employee.
The court is able to take matters both of substance and procedure into account when deciding the issue of reasonableness.
To determine whether the summary dismissal was justifiable it is determinable on the ‘merits’ of the case.
In Telecom South Ltd v Post Office Union (Inc.) [1992] 1 NZ LR 275 at 285 Richardson J on as to when a dismissal is unjustifiable said:
“A dismissal is unjustifiable if it is not capable of being shown to be just in all the circumstances. Justifiability is directed at considerations of moral justice. Whether a dismissal is justifiable can only be determined by considering and balancing the interests of worker and employer. It is whether what was done and how it was done, including what recompense was provided, is just and reasonable to both parties in all the circumstances including, of course, the reason for the dismissal. Where it does not meet that test and the primary remedy of reinstatement is not available, the awarding of compensation recognises the reality that the employment is at an end and life must go on. And a just and reasonable award must reflect the circumstances and the legitimate interests of both parties”.
On justifying summary dismissal, Sachs J in Court of Appeal in Cyril Leonard & Co v Sima Securities Trust Ltd [1971] 3 All E.R. 1313 at 1323 said:
“It has long been the law here that to justify summary dismissal of a servant ...the conduct set up by way of a servant...the conduct set up by way of defence must, indeed, be grave – as for instance conduct as would deeply impair the basic confidence that is essential should exist between the parties.”
Also in North Island Wholesale Groceries Ltd v Hewin [1982] NZCA 87; [1982] 2 NZLR 176, the Court of Appeal said at p 183:
“Regard must be had to the nature and degree of the alleged misbehaviour and so its significance in relation to the business of the employer and to the position held by the employee. In making the factual assessment the Court must weigh the questioned conduct and, viewing the matter objectively, its effect on the maintenance of the confidential relationship between them as against the severe consequences of immediate dismissal. If it is to warrant that response the misbehaviour must go to the heart or root of the contract between them.”
Was procedural fairness accorded to the plaintiff prior to his dismissal?
It has already been outlined hereabove as to the procedure adopted by the defendant before dismissing the plaintiff.
He was written to and explanations were asked for and the plaintiff’s reply was considered by the defendant and it resolved on 25 August 1998 in the Emergency Meeting of the Council to discipline the various officers of the council and that the plaintiff be summarily dismissed.
It is a requirement of the law that the procedures leading up to terminations are not only seen to be fair but are actually observed to be fair.
In the Supreme Court case of Central Manufacturing Company Limited v Yashni Kant, Civil Appeal No. 0010 of 2002 (on appeal from Fiji Court of Appeal Action No. ABU 0001 of 2001) the court held in principle that fair and reasonable treatment is generally expected today of any employer that the law has come to recognize; it is an ordinary obligation in a contract of service.
Furthermore the persuasive authority of Stuart v. Armourguard Security Limited [1996] 1 NZLR 484 holds the principle that the procedure leading to termination must be consistent with fairness. This principle was relied on by the court in the Central Manufacturing Limited (supra) where in that case the Court of Appeal found that the employee had not been confronted with the allegations upon which the employer had relied upon for termination.
In this case warning letters were written to the plaintiff. He was made well aware of the defendant’s concerns as an employer. These letters should have been sufficient to indicate the extent of risk that the plaintiff as an employee faced with the possibilities of being terminated. This would have been in line under the Agreement as far as dismissal was concerned.
On this aspect of procedural fairness I would conclude with the following passage from the judgment in Yashni Kant (supra) at p21 which is apt:
“The Court of Appeal correctly held that there is an implied term in the modern contract of employment that requires an employer to deal fairly with an employee, even in the context of dismissal. The content of that duty plainly does not extend to a requirement that reasons be given, or that a hearing be afforded at least where the employer has the right to dismiss without cause, and to make payment in lieu of notice. It does extend however to treating the employee fairly, and with appropriate respect and dignity in carrying out the dismissal. Each case must of course depend on its own particular facts. However where as in the present case the dismissal is carried out in a manner that is unnecessarily humiliating and distressing there is no reason in principle why a breach of this implied term should not be found to have occurred.”
The final issue:
Is the Plaintiff entitled to damages?
Having found on the other issues as outlined above, the question of damages does not arise at all and hence it does not have to be considered.
Conclusion
In the outcome, I find on the facts and on the authorities that the plaintiff was properly dismissed from employment for the reason I have outlined hereabove, and the plaintiff having failed to prove his case applying the civil standard of proof.
The plaintiff’s claim is therefore dismissed with costs in the sum of $700.00 to be paid within 28 days.
D. Pathik
Judge
At Suva
25 November 2005
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