Kumar v Westpac Banking Corporation [2001] FJHC 159; Hbc0242j.1999s (16 May 2001)

IN THE HIGH COURT OF FIJI
(AT SUVA)

CIVIL ACTION NO. HBC 242 OF 1999S

Between:

SUDHEER KUMAR
(f/n Ram Narayan)
Plaintiff

and

WESTPAC BANKING CORPORATION
Defendant

J.K. Maharaj for the Plaintiff
G.E. Leung with Ms. S. Sorby for the Defendant

JUDGMENT

The Plaintiff was previously employed by the Defendant (the Bank) as a security clerk.

In March 1996 an advantage saver account in the fictitious name of Ashok Ramon No. 916543-40 was opened at the Suva branch of the Bank. In June 1996 following application a Handycard (ATM) access card to the account was issued.

On 27 June 1996 four altered and valueless cheques drawn on fictitious accounts with the ANZ Bank totaling $80,000 were deposited to the new account. The following day 8 withdrawals totaling over $74,000 were made from the account using the Handycard.

An investigation into the fraud was carried out by the Bank. It emerged that (a) the account opening documentation was missing (b) that the cheque deposits had been processed with a special code to enable them to be cleared and (c) that some processing of the deposits had taken place at the legal centre of the Bank which is where the Plaintiff worked. The investigation concluded that a staff member of the Bank had been involved.

In January 1997 police investigations led to the arrest and charging of one Abid Ali for his involvement in the fraud. In due course Ali was convicted on his own plea and sentenced.

While being interviewed Ali implicated the Plaintiff and as a result the Plaintiff was interviewed on 13 & 14 March 1997 under caution by Mr. John Alfano who was the Bank’s Manager Investigations (Exhibits 5 &6).

Following the interviews the Bank wrote to the Plaintiff on 26 March. The letter (Exhibit 2) contained 6 formal allegations against the Plaintiff. It was said that the Plaintiff had conspired with Ali to defraud the Bank, that he had assisted Ali to open the fictitious account and had helped him to clear the funds. It was also said that the Plaintiff had received and for some time kept a parcel containing a large quantity of the fraudulently obtained cash before passing it on to a third party. The Bank also alleged that when interviewed about all this the Plaintiff had lied about his involvement.

On 27 March the Plaintiff replied. He denied being part of any conspiracy with Ali or assisting him in any improper way. All he admitted was receiving a parcel from Ali and keeping it for him before passing it on. The Plaintiff stressed that he was unaware of the contents of the parcel.

On the same day, 27 March 1997, the Plaintiff was summarily dismissed for serious and wilful misconduct (Exhibit 1).

These proceedings were commenced in May 1999. The Plaintiff claimed that his dismissal was unlawful and unfair and that as a result he had suffered loss of salary and other emoluments. He also claimed damages for defamation.

The Plaintiff was his only witness. His evidence centred on the interview conducted by Mr. Alfano and the allegations later made against him. While the Plaintiff once again admitted that he knew Mr. Ali before the events complained of, that he had discussed with Mr. Ali the opening of an account, that he had shown Mr. Ali where to open the account, that he had told Mr. Ali how to go about applying for a Handycard and that he had received and kept a parcel for Mr. Ali, the Plaintiff again denied being involved in any conspiracy. His case essentially was that the Bank wrongly evaluated the circumstantial evidence against him and in particular placed too much weight on what Mr. Ali had said about him. The Bank, it was argued, failed sufficiently to appreciate the fact that there was actually no direct evidence of any wrong doing on the Plaintiff’s part at all.

In cross-examination the Plaintiff agreed that the investigation and interviews were fairly conducted: it was the conclusions with which the Plaintiff was taking issue rather than the way in which they were reached.

The Bank’s main witness was Mr. Alfano who told me that he had handled several hundred fraud investigations for the Bank. He also produced the interviews and a copy of his report to the Management (Exhibit 7). In cross-examination he rejected the suggestion that the Bank unreasonably concluded that the Plaintiff had being involved in the fraud. While he accepted that there was no direct evidence against the Plaintiff he re-affirmed his view that there was strong circumstantial evidence in addition to the evidence of Abid Ali that the Plaintiff was involved. As for being unfair or harsh Mr. Alfano pointed out that given the seriousness of the Plaintiff’s conduct which the Bank was satisfied had been established there was no realistic alternative to summary dismissal.

The Bank’s second principal witness was Mr. Paul Wilkinson who was the Human Resources Manager at the time. Mr. Wilkinson told me that he received Mr. Alfano’s report and the formal letter of allegations and its response. After considering these documents he recommended to the Bank’s Chief Manager that the Plaintiff be summarily dismissed.

In response to questions from the Court Mr. Wilkinson gave evidence that the Plaintiff was employed under a contract of service which had a provision for summary dismissal in the event of serious misconduct. There was also a similar provision in the Collective Agreement between the Bank and the Union of which the Plaintiff was a member.

After completing the evidence both Counsel asked for a brief adjournment to enable them to present written submissions. Providing such an adjournment in short this is, in my experience in Fiji, an excellent procedure. The following day both Counsel filed helpful written submissions for which I am grateful.

Mr. Maharaj clarified that he had not called evidence to established quantum; this was because he assumed that liability would be tried first as is the usual practice in Fiji. Mr. Leung did not object.

In his written submission Mr. Leung pointed out that the Plaintiff’s case as presented to the court rather than as pleaded was effectively confined to paragraph 5 of the Statement of Claim. In other words, the only issue was whether the Bank had acted unlawfully in terminating the Plaintiff’s contract of employment. In the absence of any evidence or argument the questions of possible unfairness or breach of the Collective Agreement did not arise.

Apart from raising the Collective Agreement which, I agree with Mr. Leung, was not before me, Mr. Maharaj’s main submission was that given the gravity of the alleged misconduct and its consequences the Bank had failed to prove that its decision to dismiss the Plaintiff was reasonable. Mr. Maharaj once again emphasised the circumstantial nature of the evidence against the Plaintiff and suggested that his implication by Abid Ali had to be viewed with considerable scepticism not least because Mr. Ali clearly had interests of his own to serve.

Among authorities cited by Mr. Leung was a decision of the Employment Appeal Tribunal in England (Arnold J et al) British Home Stores v. Burchell [1980] 1 CR 303. Although that was an unfair dismissal case while this is an action for unlawful dismissal I am satisfied that the onus on the employer is broadly the same. What has to be decided is:

“whether the employer who discharged the employee on the ground of the misconduct in question (usually though not necessarily dishonest conduct) entertained a reasonable suspicion amounting to a belief in the guilt of the employee of that misconduct at the time.

That is really stating shortly and compendiously what is in fact more than one element. First of all there must be established by the employer the fact of that belief and that the employer did believe it. Secondly that the employer had in his mind reasonable grounds on which to sustain that belief. And thirdly, we think, that the employer at this stage at which he formed that belief on those grounds had carried out as much investigation into the matter as was reasonable in all these circumstances of the case”.

During his cross-examination of the Plaintiff Mr. Leung showed him some letters which appeared to commend the Plaintiff and which appeared at the very least to contain untruths, perhaps even to be forgeries. Mr. Leung also questioned the Plaintiff again about a number of matters ancillary to the investigation such as his relationship with Abid Ali and the mysterious affair of the parcel. The frankness of the Plaintiff’s answers, it must be said, did not impress me. But whether or not the Plaintiff struck me as a witness of truth is not really the point. The question is whether the Bank’s belief was reasonable and genuinely held.

Having read the various exhibits and heard both the Plaintiff and Mr. Alfano I have no doubt at all that the inquiry into the Plaintiff’s involvement in this fraud was conducted with scrupulous professionalism and fairness. I am also satisfied that the Plaintiff’s association with Abid Ali at the time and in the manner established gave rise to an entirely reasonable influence that the Plaintiff was involved in the fraud. In these circumstances the Plaintiff’s claim against the Defendant must fail and is dismissed.

M.D. Scott
Judge

16 May 2001