Seva v Ports Terminal Ltd [2008] FJHC 50; HBC78.2006 (28 March 2008)

IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION

Civil Action No.: HBC 78 of 2006

BETWEEN:

KAIA SEVA
Plaintiff

AND:

PORTS TERMINAL LIMITED
Defendant

Ms R. Lal with
Ms M. Rakai for Plaintiff
Mr. H. Lateef for Defendant

Date of Hearing: 13th March 2008
Date of Judgment: 28th March 2008

JUDGMENT

BACKGROUND:

[1] Kaia Seva was employed by the defendant as a stevedoring supervisor under a written contract of employment dated 8th April 2002. His term of employment was for a period of three years from 1st April 2002. His annual salary was $26,509.00. On 30th April 2003 Seva’s employment was terminated on the grounds that he had abandoned his employment under the Agreement as he had failed to report to duty for five consecutive days.

[2] Seva has brought this claim saying that his dismissal was unjustified, harsh and unreasonable and there was no reasonable cause to dismiss him. The defendant on the other hand says in its amended statement of defence that the plaintiff had been issued with two previous severe disciplinary warnings. It also says that it was under no obligation to give any reason for dismissal. It denied that the plaintiff suffered any loss or damage. Alternatively it stated in the defence that the plaintiff had abandoned the employment.

THE TERMS OF EMPLOYMENT AGREEMENT:

[3] There are two documents which together incorporate the plaintiff’s terms of employment. These are the Contract of Employment dated 8th April 2003 and the Ports Terminal Limited Partnership Agreement – Clause 5 of the agreement.

[4] The contract was for a period of three years. However it also provided for termination with notice in Clause 10 and for termination without notice in Clause 13. Clause 10.1 provided that either party could terminate the agreement by giving the other 90 days prior notice.

Section 10.1 reads:

"Your employment as Supervisor under this Contract may be terminated by either party giving written notice thereof to the other party, such notice to be given not less than 90 days prior to the date of termination or to be accompanied by the payment of the forfeiture, as the case may be, of salary representing that part of the required 90 days notice as has not been given."

[5] Section 13.3 provides for summary dismissal for a number of reasons. For purposes of this case only Section 13.3(c) is relevant. It provides:

"The Company may, at its sole discretion, in writing, terminate your employment under this contract, without notice, if you as Supervisor neglects to give substantially all your time and personal attention to your duties or absents yourself without approval;"

Of relevance also is Clause 1.1(g) of the Partnership Agreement which explains what constitutes deemed abandonment of employment. It provides that "Employees who are absent for five (5) consecutive working days without satisfactory explanation will be deemed to have abandoned their employment and will be terminated".

LETTER OF TERMINATION:

[6] The letter of termination is dated 30th April 2003. It is headed confidential. It does not refer to the particular clause under the Employment Agreement on the basis of which the defendant made the decision to summarily dismiss the plaintiff as from 30th May 2003. However, it complains that the plaintiff’s reluctance to attend work for 15 days showed that he was unwilling to be part of the company. The full text of the letter reads as follows:

"CONFIDENTIAL

PORTS TERMINAL LIMITED

MEMORANDUM

Manager Human Resources

30/04/03

Mr. Kaia Seva

TERMINATION OF SERVICE

Management would like to put on record their disappointment with such callous attitude for making a mockery of the company leave policy, tantamount to gross negligence of your position as supervisor.

Your attendance to the Military course is not an official course for Ports Terminal Limited personnel as you had made this arrangement during your leave period from 24th March – 31st March 03 and you had to report back for duty on 1st April 2003.

Our records show that, you did not report to work, but later filled in a leave form dated 2nd April for seventeen (17) days, and this leave application was rejected based from letter of General Manager Operation to RFMF Headquarters on 28th March 03 informing them that we cannot entertain their request.

For the purpose of clarity, we reiterate that you continue to pursue with the course hence before your leave application was processed.

Your reluctance to attend work for fifteen (15) days has indicated your unwillingness to be part of this company.

We, therefore, inform that, your service as supervisor Stevedoring for Ports Terminal Limited has been terminated from today, Wednesday 30th April 03.

Any wages, annual, bank and sick leave allowance owed to you by this company will be paid to you by 1600 today.

Yours faithfully,

PORTS TERMINAL LIMITED

{Sgd:}

JIOJI TAHOLO

MANAGER HUMAN RESOURCES"

[7] The plaintiff was a part time military officer as well. The letter complains that the plaintiff had attended a course conducted by the military during his leave from 24th March 03 to 31st March 2003. It also says that the plaintiff did not report to work even though the defendant had informed RFMF Headquarters that plaintiff’s leave was refused.

WAS THE PLAINTIFF GRANTED LEAVE?

[8] There are four persons who testified: the plaintiff, Vilikesa Qalilawa who was supervisor administration stevedoring and superior to the plaintiff, Epeli Matata who was the senior recruiter, who used to arrange workers for various shifts and Osea Tuberi who is acting Manager Human Resources for the defendant company since May 2007.

[9] According to the plaintiff he was on leave from 24th March 2003 to 31st March 2003 and attended a course conducted by the military. The course had not finished so he returned to work on 1st April 2003 and applied for further leave. This leave he says was declined but he was asked by Manager Human Resources to reapply which he did by plaintiff’s Exhibit 3 (Document 24).

[10] He explained that the normal procedure was for one to lodge his leave application with the immediate superior and if the immediate superior approved, one went on leave. He said this was the normal practice despite the fact the final approval rested with Manager Human Resources.

[11] Vilikesa Qalilawa too referred to the prevailing practice of employees going on leave once the section head recommended leave even though the Human Resources Manager had the final say. Qalilawa also told the court that he approved the plaintiff’s leave by writing OK and then signing it.

[12] He told the court that he received the form back on 16th April 2003 from Human Resources Manager stating leave is not granted and requesting the plaintiff to return to work as soon as possible. He told the court that he rang and the plaintiff came back to work and was rostered to night shift by him.

[13] I believe the plaintiff and Qalilawa that there was a prevalent practice at the defendant’s depot that employees went on leave once the immediate superior recommended leave. Osea Tuberi joined the defendant only in 2007 and he would not be aware of the practice which existed in 2003 and prior to that. This practice is even fortified by the Human Resources Manager’s note that the plaintiff was to return to work as soon as possible. This would indicate that the Human Resources Manager knew that the plaintiff was on leave and requested that he return. Clearly even the Human Resources Manager condoned this practice. The letter of termination does not say that the plaintiff’s employment was terminated because he went on leave without the approval of Human Resources Manager.

[14] There is no dispute that the plaintiff was away from work from 2nd April to 17th April 2003. He went away after Qalilawa recommended his leave. Qalilawa told the court that once he learnt that the Human Resources Manager had refused leave, he called the plaintiff on phone. The plaintiff returned to work and on the application of the plaintiff he rostered the plaintiff to night shift. The plaintiff had requested night shift as he was still doing the course.

[15] According to the plaintiff there were five stevedore supervisors. He would be called to come to work by the recruiter when vessels came to port. Epeli Matata the senior recruiter confirmed that he would call the supervisors when needed. He also stated that he put the plaintiff on the midnight shift from 17th April as the plaintiff was asking for this shift. He could not recall if the plaintiff came to work or not because events had occurred long time ago.

[16] The plaintiff in cross examination explained that he was called on mobile phone when his stevedoring services were required. He got paid for 40-hour week even if he was idle. If he worked more than 40-hour week, he did not get paid overtime but the extra hours were added and called banked hours. These banked hours were converted into leave.

[17] The system sounds strange but documents tendered confirm the banking hours. The partnership agreement in Clause 2.2 provided for flexible hours with Bank. Document 29 which is dated 30th April 2003 shows the leave entitlements including Bank hours of the plaintiff.

[18] I find that the plaintiff did come back to work once requested. I find he was rostered on a night shift. The defendant’s own witness Osea Tuberi in cross examination confirmed that "defendant continued to pay plaintiff as we were receiving time sheets. Time sheets indicated he was working". I therefore hold that the plaintiff had not abandoned work. There is no basis for the defendant to say that the plaintiff failed to attend work for fifteen days as stated in the letter of termination. The termination of the plaintiff was wrongful and without good cause.

ISSUE OF COMPENSATION/DAMAGES:

[19] Mr. Lateef submitted that if the court came to the conclusion that the plaintiff had not abandoned employment, then the plaintiff was entitled to only 90 days salary in lieu of notice and not damages assessed in the basis of the balance of contract. He relied on Central Manufacturing Company Limited v. Yashni Kant – CBV 10 of 2002. He also submitted that no damages ought to be awarded for mental distress arising from the manner of dismissal.

DAMAGES FOR MENTAL DISTRESS:

[20] Yashni Kant confirmed that damages may be awarded for mental distress if the employer in carrying out the dismissal did not treat the employee with appropriate dignity.

[21] To be entitled for damages for mental distress the statement of claim must allude to facts from which humiliation and loss of dignity can be inferred. Simply pleading damages for humiliation and injured feelings is not enough. In the present case no facts are referred to in the statement of claim to show plaintiff was humiliated. In fact the letter of termination is marked confidential; it was delivered personally to the defendant. The defendant was not given marching orders or escorted out of the office in presence of other workers. In fact the plaintiff upon receipt of notice went to the defendant employer demanding explanation and reinstatement. On the facts of this case there can be no damages for mental suffering, or anguish.

DAMAGES FOR WRONGFUL DISMISSAL:

[22] Contrary to Mr. Lateef’s submissions, Ms Lal submitted that the plaintiff is entitled to his salary for the balance of the term of contract as damages. She submitted that the defendant cannot now rely on the 90-day notice clause because if it wanted it could have used the clause on 30th April 2003 but not in hindsight now.

[23] The defendant, if it wanted, could have given the plaintiff a 90-day notice under the agreement and terminated the agreement. In Yashni Kant the Supreme Court relied on a passage from the Canadian case of Wallace v. United Grain Growers Ltd. – (1997) 3 SLR 701 which stated that "In the event that an employee is wrongfully dismissed, the measure of damages from wrongful dismissal is the salary that the employee would have earned had the employee worked during the period of notice to which he or she was entitled". The Supreme Court concluded that there is now an implied term at common law that an employer can make payment in lieu of notice. Yashni Kant is the binding authority on Fiji courts and I follow it.

[24] On the basis of this authority the plaintiff would be entitled to 90 days salary. He would also be entitled to all the fringe benefits which were incidental to his employment namely $60.00 per month for mobile phone, the 8 percent employer’s statutory contribution to Fiji National Provident Fund. The fringe benefits are recoverable for the period required to lawfully terminate the employment. It has been held that financial loss resulting from loss of tips that would been earned: Manubens v. Leon – (1919) 1 KB 208; use of car: Kilburn v. Enzed Precision Products (Australia) Pty Ltd. – (1988) 4 VIR 31; pension and superannuation entitlements: Bold v. Brough, Nicholson and Hall Ltd. – (1964) 1 WLR 201, 211 during the period required to lawfully terminate the contract are recoverable. Accordingly the plaintiff would be entitled to the 90 days salary which is $6,627.00 (one quarter of his annual salary). He is entitled to 8 percent employer’s statutory contribution to Fiji National Provident Fund on this sum that is $530.32. He was given use of $60.00 worth of charges per month on mobile phone so that is a total of $180.00. His fortnightly pay slip (document 17) shows a payment of $88.52 being paid to Colonial Mutual Life Association. This I believe was for an Insurance policy. This would mean a loss of six such payments over 90-day period or $511.12. Hence his total loss over the 90-day period is $7,848.44.

INTEREST:

[25] The plaintiff has claimed interest. He had been kept out of this money which should have been given to him on 30th April 2003 or at the latest if he had been allowed to work the 90-day period by 30th July 2003. Accordingly I allow him interest as from 30th July 2003 at 6 percent per annum. This is a period of roughly 4 years and 8 months. The interest therefore is $2,194.42.

COSTS:

[26] Mr. Lateef submitted that if the court only allows damages for 90 days then I should not award costs. That cannot be unless the defendant had paid the money into court and the plaintiff had nevertheless pursued the claim. Here money was not paid into court so the plaintiff is entitled to pursue the claim and therefore his costs which I summarily fix in the sum of $3,500.00.

FINAL ORDER:

[27] Accordingly I enter judgment for the sum of $7,848.44 together with interest in the sum of $2,194.42 and costs in the sum of $3,500.00.

[Jiten Singh]
JUDGE

At Suva
28th March 2008