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Kerowa v Harriman [2017] PGNC 261; N6940 (11 October 2017)

N6940

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]


WS NO 1185 OF 2015


BETWEEN
TONY CHARLES KEROWA,
ADMINISTRATOR OF THE ESTATE OF LATE STEVEN KEROWA, ON BEHALF OF THE ESTATE AND DEPENDANTS
Plaintiff


AND
ARNOLD HARRIMAN, GENERAL MANAGER,
HUMAN RESOURCES, PNG POWER LIMITED
First Defendant


AND
KALIP SALO, GENERAL MANAGER,
CORPORATE SERVICES, PNG POWER LIMITED
Second Defendant


AND
JOHN TANGIT,
CHIEF EXECUTIVE OFFICER, PNG POWER LIMITED
Third Defendant


AND
PNG POWER LIMITED
Fourth Defendant


Madang : Cannings J
2016, 12 July &10 August
2017, 11th October


LAW OF EMPLOYMENT – constructive dismissal – whether the employee was forced to resign due to wrongful conduct of employer.


NEGLIGENCE – whether employer breached duty of care to employee by manner in which it failed to deal with question of continuation of employee’s employment – whether employer’s conduct led to employee suffering depression – whether employee’s depression and poor mental health led the employee to deliberately cause his own death in a motor vehicle accident.


WORKERS COMPENSATION – Workers Compensation Act – whether employer liable to dependants of deceased former employee in respect of death of former employee.


The plaintiff’s brother (the deceased) was a long-serving employee of the fourth defendant who was killed in a motor vehicle accident ten days after tendering his resignation. The plaintiff is the administrator of the deceased’s estate. The plaintiff blames the fourth defendant for the death of the deceased. He commenced proceedings against the fourth defendant and three of its senior managers, seeking damages that would inure in favour of the deceased’s dependants (wives and children and other relatives), relying on three causes of action: constructive dismissal, negligence and a workers’ compensation claim. The defendants denied all allegations. A trial was conducted on the issue of liability.


Held:


(1) Constructive dismissal is a form of wrongful dismissal action, the essence being that the conduct of the employer leads to forced resignation of the employee, eg where the employee is given the choice of resignation or dismissal or where the employer has engaged in a course of conduct with the deliberate and dominant purpose of coercing the employee to resign or where a breach of duty by the employer forces the employee to resign.

(2) Negligence is a tort, the elements of which are, in the context of a claim against an employer for alleged damage caused to an employee: (a) the employer owed a duty of care to the employee; (b) the employer breached that duty (acted negligently); (c) the breach of duty caused damage to the employee; and (d) the type of damage was not too remote.
(3) The elements of a workers’ compensation action under Section 54 of the Workers’ Compensation Act Chapter No 179 are that: (a) there is an employment of a worker by an employer; (b) personal injury is caused to the worker; (c) the injury arose out of or in the course of the employment.

(4) There was a dearth of evidence that this was a case of forced resignation, so the constructive dismissal claim failed.

(5) The deceased’s employer owed the deceased a duty of care and there was sufficient evidence of dilatoriness on the part of the deceased’s employer in not deciding whether to continue the deceased’s employment, on which to base a finding of breach of duty. However it was not proven that the breach of duty led to the death of the deceased. Further the death of the deceased was not a reasonably foreseeable type of injury, and thus too remote. The third and fourth elements of the tort of negligence were not established and the negligence claim failed.

(6) The deceased decided of his own volition, without approval from his superiors, for purposes extraneous to his work commitments, to drive a vehicle to a place he was not required to go. In the course of driving the vehicle there was an accident in which he was killed. The deceased’s death did not arise out of or in the course of his employment. The workers’ compensation claim failed.

(7) The proceedings were entirely dismissed. The parties were ordered to bear their own costs.

Cases cited:


The following cases are cited in the judgment:


Papua New Guinea Cases


Apolonia Steven v Ram KC (2016) N6577
Lubbering v Bougainville Copper Ltd [1977] PNGLR 183


Overseas Cases


Auckland Shop Employees Union v Woolworths (NZ) Ltd [1985] 2 NZLR 372


TRIAL


This was a trial on liability for constructive dismissal, negligence and workers’ compensation.


Counsel:


G Pipike, for the Plaintiff
D Dusava, for the Defendants


11th October, 2017


  1. CANNINGS J: The plaintiff’s brother, Steven Kerowa, was a long-serving employee of PNG Power Ltd, the fourth defendant. Steven Kerowa was killed in a motor vehicle accident at Gusap, in the Ramu Valley of Madang Province, on 4 December 2014. This was ten days after he had tendered notice of his resignation. The plaintiff, Tony Charles Kerowa, is the administrator of Steven Kerowa’s deceased estate.
  2. The plaintiff blames PNG Power for the death of his brother. He claims that PNG Power dealt with Steven Kerowa so badly, in particular by not deciding on whether he would be offered a new contract of employment and allowing him to get into a precarious financial situation, that Steven experienced clinical depression. He claims that this culminated in Steven being forced to resign, and ten days later taking his own life, by deliberately ramming the vehicle he was driving, in the course of his employment, into a bridge.
  3. The plaintiff commenced proceedings against PNG Power and three of its senior managers, seeking damages that would inure in favour of Steven’s dependants (wives and children and other relatives). He relies on three causes of action:
  4. The defendants deny all allegations. A trial has been conducted on the issue of liability.

CONSTRUCTIVE DISMISSAL


  1. Mr Pipike for the plaintiff submitted that the defendants were liable for constructive dismissal from employment of Steven Korowa in two respects:

Statutory claim


  1. Section 36(2) (grounds for termination of contract) states:

An employee may terminate a contract of service without notice—


(a) if the employer or a person acting or purporting to act on his behalf or by his authority—


(i) induced him to enter into the contract by force, fraud or a statement that was misleading in any material particular relating to the employment; or

(ii) has been convicted of an offence against or a contravention of this Act or any other law relating to the employee or his dependants; or

(iii) has been negligent or careless in the discharge of his duties towards the employee or his dependants under the contract, this Act or any other law; or

(iv) has committed an act of omission or commission that is inconsistent with the due and faithful discharge of his obligations towards the employee or his dependants; or

(v) has ill-treated the employee; or


(b) on any other ground on which he would be entitled to terminate the contract without notice at common law.


  1. Mr Pipike submitted that there was ample evidence that PNG Power was negligent and careless in the discharge of its duties towards its employee, Steven Kerowa, and had committed acts of omission that were inconsistent with the due and faithful discharge of its obligations towards its employee and had ill-treated its employee. Therefore Steven Kerowa was entitled to terminate the contract of employment under Sections 36(2)(a)(iii), (iv) and (v), and this amounts to constructive dismissal.
  2. I agree that there is substantial evidence that PNG Power was negligent and careless, that it had committed acts of omission and that it had to some extent ill-treated Steven Kerowa, by failing to make a timely decision on renewal of his written contract of employment, which expired on 25 January 2014. I also agree that it could reasonably be found that Steven Kerowa was entitled to terminate the contract of employment without notice under Section 36(2). However, I fail to appreciate the connection between such a conclusion and the proposition that that amounts to constructive dismissal. Section 36(2) says nothing about constructive dismissal. It simply provides for circumstances in which an employee can terminate a contract of employment without notice. The argument for some form of statutory constructive dismissal is misconceived and is rejected.

Common law


  1. Constructive dismissal is a form of wrongful dismissal action, the essence of which is that the conduct of an employer leads to the forced resignation of an employee. There appears to be no reported PNG case of constructive dismissal. However, it is, as Mr Pipike submitted, a recognised form of common law action. It has been adopted as part of the underlying law of PNG. One of the leading cases in the Pacific is Auckland Shop Employees Union v Woolworths (NZ) Ltd [1985] 2 NZLR 372, in which the New Zealand Court of Appeal described three scenarios in which a forced resignation will be deemed to have occurred:
(a) where the employee is given the choice of resignation or dismissal; or
(b) where the employer has engaged in a course of conduct with the deliberate and dominant purpose of coercing the employee to resign; or
(c) where a breach of duty by the employer forces the employee to resign.
  1. I find that Steven Korowa was never told or given the indication that he had to resign or be dismissed. I find no evidence that PNG Power engaged in any course of conduct with the deliberate or dominant purpose of coercing Steven Korowa to resign. Scenarios (a) and (b) did not exist.
  2. As to (c), I find that there was a ‘breach of duty’ on the part of PNG Power in two respects. First, it had a duty under the terms of Steven Kerowa’s last written contract of employment to notify him within three months before its expiration whether he would be offered another contract. It failed to do that. Secondly, it had a common law duty to communicate clearly and effectively with its employee as to the future of his employment. It failed to do that.
  3. However I am not satisfied that it has been proven on the balance of probabilities that either of these breaches of duty forced Steven Korowa to resign. The evidence shows that he was in a difficult financial situation in 2014. He was frustrated by the failure of the human resources department to respond to his repeated requests for a decision to be made on his future employment. But he continued to be paid on the same terms and conditions that applied to him under his written contract of employment. It cannot be concluded that he was forced to resign. The constructive dismissal claim fails.

NEGLIGENCE


  1. Negligence is a tort, the elements of which are, in the context of a claim against an employer for alleged damage caused to an employee:

(a) the employer owed a duty of care to the employee; and

(b) the employer breached that duty (acted negligently); and

(c) the breach of duty caused damage to the employee; and

(d) the type of damage was not too remote.


Duty of care


  1. Element (a) has been established. PNG Power owed a duty of care to all its employees including Steven Kerowa to provide a safe working environment (Lubbering v Bougainville Copper Ltd [1977] PNGLR 183); and to communicate clearly and effectively with its employees as to the future of their employment.

Breach of duty


  1. As I found earlier, there is sufficient evidence of dilatoriness on the part of PNG Power in not deciding whether to continue Steven Kerowa’s employment, on which to base a finding of negligent breach of the duty to communicate effectively. Element (b) is to that extent established.
  2. The alleged breach of duty to provide a safe working environment raises more complex issues. The plaintiff argues that:
  3. The principal evidence in support of the proposition that Steven Kerowa suffered from clinical depression brought upon by the manner in which he was treated by PNG Power, is the opinion of Philip Kusom Tom, who describes himself as a qualified psychologist. Mr Tom deposed in an affidavit admitted into evidence that he formed the opinion that Steven Kerowa was “deeply depressed” and that this “was induced by the working environment”. Mr Tom also gave oral evidence and was subject to cross-examination.
  4. I uphold the submission of Mr Dusava for the defendants that Mr Tom’s evidence and opinion is of little probative value, for the following reasons:
  5. I reject the argument that Steven Kerowa was, in fact, suffering from depression during 2014. If I am wrong in that finding and in fact Steven Kerowa was suffering from depression I find no credible evidence to support the proposition that that condition was brought upon by a breach by PNG Power of its duty to provide a safe working environment. It is much more likely that any depression or poor mental health was brought about by the financial predicament which Steven Kerowa was in during 2014. I reject the argument that his financial predicament was created by PNG Power.
  6. I therefore find no breach by PNG Power of the duty to provide a safe working environment.

Causation


  1. As to element (c), I find that PNG Power’s breach of the duty to effectively communicate with Steven Kerowa did not cause him any injury. The plaintiff’s argument that Steven Kerowa was suffering from clinical depression has been rejected.
  2. If I had found that Steven Kerowa was suffering from depression brought about by negligence on the part of PNG Power, I would have been unable to find that he took his own life by ramming the vehicle he was driving into a bridge. There was a police investigation into the incident which concluded that speed and alcohol were its principal causes. It is conceded that Steven Kerowa had been consuming alcohol in excess immediately before the incident. A passenger in the vehicle, Jeffery Yapate, gave evidence. Mr Yapate’s opinion was that Steven Kerowa was agitated and that he deliberately drove into the bridge. I was not impressed with Mr Yapate’s evidence. Mr Yapate also gave evidence that Steven Kerowa was on official duty when he was driving the vehicle. This evidence conflicted with that of other PNG Power employees who testified that Steven Kerowa was on an unauthorised private trip at the time of the accident – not on official duty. I found their evidence much more convincing than that of Mr Yapate.
  3. It has not been proven that any breach of duty by PNG Power led to the death of Steven Kerowa. Element (c) of the tort of negligence has not been established.

Remoteness


  1. As to element (d), if it had been found that there was a causal connection between a breach of duty by PNG Power and the death of Steven Kerowa, I would have found that the death of the deceased was not a reasonably foreseeable type of injury and was too remote.
  2. Elements (c) and (d) of the tort of negligence have not been established. The negligence claim fails.

WORKERS’ COMPENSATION CLAIM


  1. The plaintiff makes a claim in respect of the death of Steven Kerowa under Section 54 (liability of employer to compensate worker for injuries) of the Workers’ Compensation Act Chapter No 179, which states:

(1) If in any employment personal injury arising out of or in the course of the employment is caused to a worker, his employer shall, except as provided in this Act, be liable to pay compensation in accordance with this Act.


(2) Without limiting the generality of Subsection (1), an injury shall be deemed to arise out of or in the course of the employment of a worker if it occurs while the worker—


(a) is in the course of a daily or other periodic journey between his place of abode and his place of employment, whether such journey is to or from his place of employment; or

(b) is in the course of a journey between his place of employment or place of abode and an institution which he is required by law to attend, or which he attends at the request of or with the approval of the employer for the purpose of attending a class or undertaking training at such an institution; or


(c) is in attendance at an institution referred to in Paragraph (b) for a purpose referred to in that paragraph; or


(d) is in the course of a journey between his place of abode or place of employment and any other place for the purpose of—


(i) obtaining a medical certificate in connection with any injury for which he has received compensation or for which a claim for compensation has been admitted; or

(ii) receiving attention or treatment in connexion with any such injury, medical, surgical or hospital advice,

or is in attendance at any such place for any such purpose; or


(e) is in attendance at his place of employment for reasons connected with his employment including any period—


(i) before he has commenced his work for the day; and

(ii) after he has concluded his work for the day; and

(iii) during an authorized break in his work,

so long as the worker—

(iv) is not guilty of any misconduct or breach of his employer's instructions; and

(v) did not voluntarily subject himself to any abnormal risk of injury.


(3) While a worker is in the course of a journey from his place of employment under one employer to his place of employment under another employer, this section applies and has effect as if the first-mentioned place of employment were his place of abode.


(4) Notwithstanding any other law, a person who ordinarily engages in employment in connexion with which he customarily attends at a place of pick-up, shall be deemed to be working under a contract of employment—


(a) with the employer who selected and engaged him at the place of pick-up; or

(b) if no employer so selected or engaged him—with the last employer who, within the immediately preceding 21 days, selected and engaged him in that employment.


(5) Notwithstanding anything in this Act, compensation under this Act is not payable—


(a) in respect of any injury that is consequent on or attributable to the serious and wilful misconduct of the worker unless that injury results in the death or permanent total incapacity of the worker; or

(b) in respect of a deliberately self-inflicted injury.


  1. The elements of a workers’ compensation action under Section 54 of the Workers’ Compensation Act Chapter No 179 are that:

(a) there is an employment of a worker by an employer;

(b) personal injury is caused to the worker;

(c) the injury arose out of or in the course of the employment.


  1. Elements (a) and (b) are established. Steven Kerowa was a “worker” employed by PNG Power on the day of his death. Though he had given notice of his resignation ten days beforehand, there had been no official response to the notice and neither he nor PNG Power had done anything further to terminate the employer-employee relationship.
  2. The critical element is (c): did Steven Kerowa’s injury arise out of or in the course of his employment? The plaintiff argues that Steven Kerowa drove from Madang town to Yonki on 4 December 2014 for work-related reasons. Reliance is again placed on evidence of Jeffrey Yapate who testified that customary landowners around Yonki were still seeking compensation for environmental damage and their claims were being dealt with by Steven Kerowa.
  3. I find that evidence unconvincing. Mr Yapate was not a reliable witness. I found the evidence of PNG Power employees Mesi Butu, Cathy Sigiamo and Munny Saun much more convincing: that Steven Kerowa was on a private trip on the day of his death, 4 December 2014. He had flown with Mr Butu on 2 December 2014 to give evidence in a District Court case. The case was adjourned to 5 December 2014. On the morning of 4 December 2014 Steven Kerowa advised Mr Butu that he was going to drive to Yonki to attend to some personal matters. Mr Butu advised him against it, but Steven insisted and left. He appears to have gone to Yonki and had the motor vehicle accident on his way back to Madang later in the day. Ms Sigiamo is PNG Power’s Manager of Lands and Community Services. She was Steven Kerowa’s boss during the time that he spent a considerable period based at Yonki for purposes of preparation of the feasibility study for the Ramu 2 Hydro-Generation project. I accept Ms Sigiamo’s evidence that Steven Kerowa had by December 2014 completed his role in the feasibility study. He had no need to travel to Yonki for any official business.
  4. I find that Steven Kerowa of his own volition, without approval from his superiors, for purposes extraneous to his work commitments, drove a vehicle to Yonki, a place he was not required to go. In the course of driving the vehicle there was an accident in which he was killed. His death did not arise out of or in the course of his employment. The workers’ compensation claim fails.

CONCLUSION


  1. The plaintiff has failed to prove his case and the proceedings will be dismissed. As to costs, I take the same approach I have taken in a number of cases in which employees have taken their former employers to court for wrongful dismissal, and lost (eg Apolonia Steven v Ram KC (2016) N6577). In the normal course of events if I applied the rule of thumb as to costs I would order the plaintiff to pay the defendants’ costs. However when making any order for costs the court must exercise its discretion according to the circumstances of the case and in the interests of justice. At the centre of this case is a tragedy for the plaintiff and the extended family and the friends and work colleagues of the plaintiff’s deceased brother. The plaintiff has raised some valid issues and the conduct of PNG Power has been found to have been less than exemplary. He should not be visited with an order to pay the defendants’ costs. The Court must strive to make access to justice easy and cheap and to keep its doors open to those persons who have genuine grievances and do not act for any improper motive. I will order the parties to bear their own costs.
  2. I make one other remark in closing. It became apparent as the case progressed that counsel for PNG Power, Mr Dusava, who is an officer of PNG Power, knew the deceased Steven Kerowa, as a colleague and as a friend, very well. Mr Dusava did an admirable job defending this case for his employer. However, on reflection, he should not have appeared. I did not say anything at the time and no objection was taken by the plaintiff’s counsel, Mr Pipike, but it is clear that Mr Dusava was in a conflict of interests and for that reason should have declined to appear. Lawyers are officers of the Court and have a paramount obligation to the Court to bring independent judgment to bear on the discharge of their duties to the Court. Rule 12(2) (independence) of the Professional Conduct Rules stipulates that a lawyer shall not appear in court “in any matter where by reason of ... personal relationship, the impartial administration of justice might appear to be prejudiced”. This case should have been briefed out to independent counsel.

ORDER


  1. The Court orders as follows:

Judgment accordingly.


_______________________________________________________________
GP Lawyers: Lawyers for the Plaintiff
PNG Power Ltd In-house Counsel: Lawyer for the Defendants


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