In re Application for Judicial Review by Colonial Fiji Life Ltd [2011] FJHC 814; HBJ41.2005 (22 November 2011)

IN THE HIGH COURT OF FIJI AT SUVA
CIVIL JURISDICTION

Judicial Review No. HBJ 41 of 2005

IN THE MATTER of an application by COLONIAL FIJI LIFE LIMITED for a Judicial Review under Order 53 of the High Court Rules 1988

and

IN THE MATTER of the Award No. 19 of 2005 of the ARBITRATION TRIBUNAL dated on the 30th day of March, 2005

STATE -v- ARBITRATION TRIBUNAL
First Respondent

FIJI BANK AND FINANCE SECTOR EMPLOYEES UNION
Second Respondent

Ex-Parte: COLONIAL FIJI LIFE LIMITED
Applicant

Hearing: Before the Hon. Justice Jitoko proceedings concluded on 23 March 2007

Submissions: Before the Hon. C. Kotigalage on 22 November 2011

Appearance: Mr Apted J for Applicant
Mr Sharma S for 1st Respondent
Mr Singh R for 2nd Respondent

Judgment

The Application for Judicial Review was filed on 28th September 2005 to quash the Award No. 14 of 30th March 2005 made by the Arbitration Tribunal (1st Respondent).

Hon. Justice Jitoko made Order granting leave on 13th February 2006 and stated the said Order to operate as a stay of the decision by Arbitration Tribunal.

The Applicant Colonial Fiji (Life) Limited (now known as BSP Life (Fiji) Limited alleges that Arbitration Tribunal made errors of Law of the record and that the Applicant is entitle to seek Judicial Review on the Award.

The hearing concluded before Hon. Justice Jitoko on 23rd of March 2007 and was fixed for Judgment on Notice.

When this case came up before me to deliver the Judgment, the Applicant and the Respondent agreed to adopt the proceedings before Hon. Justice Jitoko.

Counsels for the Parties made oral submissions before me on 22nd November, 2011.

I am thankful to all the Counsels for assisting Court by making their submissions to deliver this Judgment.

I am taking into consideration the Applicants affidavits, affidavits filed on behalf of 1st and 2nd Respondents, written submissions and oral submissions made by the Counsels to arrive at a conclusion.

Background

1. The Applicant sought Judicial Review of the Arbitration Tribunal Award No. 19 dated 30th March 2005.
   
2. On 2nd of October 2003, Permanent Secretary Labour Industrial Relations and Productivity referred the Trade Dispute between Colonial Fiji Life Ltd and Fiji Financial Sector Employees Union to the Arbitration Tribunal to consider incorporating following clauses to a Collective Agreement;
   

1. Clause 7 (vii) (b) (c) Sick Leave Bonus;

2. Clause 8 (v) Away from Home Allowance;

3. Clause 11 (b) Length of Service.

The claims are detailed below. The said clauses were existing in the Collective Agreement of the Colonial National Bank Limited and the same Trade Union requested to incorporate said clauses in the Collective Agreement between 2nd Respondent Union and Applicant, (Colonial Fiji Life Ltd).

1. Clause 7 (vii) (b) (c) Sick Leave
   

(b) An Employee who does not take more than six days sick leave in any Calendar year will be given bonus at normal salary rates for the number of days for which sick leave is not taken;

(c) The bonus which will be paid at the end of each Calendar year will be calculated as follows:

(i) Subtract from 14 the number of days leave actually taken during the year;

(ii) Multiply the result by the daily rate of pay at the time of calculations.

2. Clause 8(v) Dealing with the Away from Home Allowance
   

"Unless otherwise agreed between the Union and the Employer concerned and employees ordinarily residing at the home of his/her parents or at such place at which he/she could be reasonably expected to have regarded as being his or her normal place of abode and who, because of his or her appointment is required to reside at another place shall be paid in addition to all other salary and allowances payable to him/her, an allowance reimburse the employee for extra expense incurred, at annual rates as follows:

Years of Service Allowance

1st $658.00
2nd $549.00
3rd $446.00
4th $385.00"

3. The Third Clause 11(b) Length of Service
   

(b) All services, whether broken or continuous or in broken periods (provided that the break is not more than 12 months).

The Learned Arbitrator has made the Award on 30th day of March 2005 directing the Collective Agreement be amended by inserting the above mentioned clauses:-

"i.e. 1 - Clause 7 (viii) (b) (c) Leave Bonus.

2 – Clause 8 (v) Away from Home Allowance.

3 – 11 (b) Length of Service."

It is further ordered by the Tribunal the said Clauses to be effective from 1st January 2005.

Reliefs sought by the Applicant is an Order of Certiorari to remove the decision of the Arbitration Tribunal on the basis that Arbitration Tribunal made errors of law on the face of the record in its Award No. 19 2005 delivered on 30th August 2005.

Grounds of Review as Stated in the Application filed by the Colonial Fiji Life Ltd (Applicant)

(a) It is Applicants Contention that the Arbitrator made errors of Law on the face of the record.

• (i) "The Learned Tribunal erred in Law when he concluded that the Applicant had not shown substantive reason as to why employees engaged in the insurance operations should not enjoy the same conditions as enjoyed by the employees engaged in the banking operations.
  
• (ii) The Learned Tribunal erred in Law when he held that the Applicant had not put forward substantive proposition which would outweigh the Second Respondent's basic agreement that uniformity of terms and conditions in the work place are desirable.
  
• (iii) The Learned Tribunal erred in Law when he did not accept the proposition by the Applicant that the banking and insurance industries are two separate industries and that as a result there is no reason for the employees engaged in those industries to enjoy uniform working conditions.
  
• (iv) The Learned Tribunal erred in law by failing to make industry comparisons and not taking into account the Collective Agreement between the First Respondent and the Life Insurance Corporation of India which was provided to the Tribunal by the Applicant. The Tribunal should have done a comparison with this Collective Agreement as it applied to workers in the insurance industry.
  
• (v) The Learned Tribunal erred in law by failing to consider that it was the Second Respondent that was seeking changes to the Collective Agreement and as such, the onus was on the Second Respondent to justify those changes.
  
• (vi) The Learned Tribunal erred in law by failing to observe that there was a failure on the part of the Second Respondent to produce any form of concrete evidence to justify the changes it was seeking in the Collective Agreement instead of merely brining in the banking terms and conditions which it regarded as superior.
  
• (vii) The Learned Tribunal erred in law in not properly considering that Colonial Fiji Life Limited and National Bank of Fiji Limited trading as Colonial National Bank are separate legal entities.
  
• (viii) The Learned Tribunal erred in law when he held that the Collective Agreement be amended in the terms sought by the Second Respondent."
  

Applicant's Submissions

Counsel Mr Apted made submissions drawing Court's attention to the affidavits, and Arbitration Proceedings filed by the 1st Respondent. He stated in all similar matters generally the Arbitration Tribunal (1st Respondent) does not file written submissions and in this Judicial Review application, Attorney General filed his written submissions, on behalf of the 1st Respondent. I am inclined to accept this argument and consider that the submissions filed by Attorney General is to assist court to come to a conclusion.

Counsel also submitted Arbitration Tribunal has wrongly come to the conclusion by applying wrong process by stating "certainly the employer has not put forward any substantive proposition which would outweigh the Unions basic agreement that uniformity of terms and conditions in the work place is desirable"

It is also submitted that "Banking and Insurance are two different industries" and it is not appropriate by the Arbitrator to consider both industries as one.

Counsel agreed to forward further authorities on the matter which were filed on 24/11/2011.

Counsel also made submissions quoting certain statements made by the Arbitrator in his Award which were analysed by me separately in this Judgment.

1st Respondents Submission
In addition to the written submissions filed by 1st Respondent on 23/11/2011, Mr Sharma counsel made further submissions before Court. He quoted Paras 5.2; 5.3; 5.4(c) and I to (vii) of the written submissions and forwarded the copies of authorities for consideration by this Court.

Counsel Mr Sharma made submissions on the issue of changing the decision of the Tribunal and the limitations. He drew the attention of certain authorities with regard to reasonableness, ultra vires and fairness.

2nd Respondents Submission
Mr Singh Counsel for the 2nd Respondent submitted before arriving at the decision Arbitration Tribunal has considered all materials including collective agreements, written submissions and documents.

Mr Singh submitted Arbitrator has not erred in law when he dealt with the issue of Banking and Insurance operations.

Applicant has not made emphasis on this issue in the application for Judicial Review. The onus was on the part of the Employer in this regard.

He further submitted 2nd Respondent has justified its claim and Arbitration award should stand. Mr Singh drew the attention of Court to the submissions made by the 2nd Respondent at the Arbitration Tribunal.

Grounds for Judicial Review

I shall now consider and analyse the grounds for review by considering the affidavits filed by the parties, written and oral submissions, and relevant authorities.

As the Disputes Committee was unable to resolve the dispute it was referred to the Arbitration Tribunal (1st Respondent) with the term of reference detailed in letter dated 2nd October 2003 by the Permanent Secretary for Labour, Industrial Relations & Productivity.

The application before Arbitration Tribunal was inter-parte and no evidence was led and Award was made on the submissions made by the parties.

It is stated Judicial Review is concerned "not with the decision but with decision making process unless that restriction on the Power of Court is observed the Court will in my view, under the guise of Preventing Abuse of Power, be itself usurping power," (Lord Brightman in Chief Constables of North Wales Police vs Evans (1982 1 WLR 115 at 1173.

In the present case the issues to be addressed by Court is whether the Tribunal proceeded fair and reasonable manner and if not whether the Tribunal has made error of law which amounts to procedural impropriety.

The grounds seeked by the Applicant for Judicial Review is the decision arrived by the Tribunal is on pretext and Applicant has submitted that the Arbitration Tribunal did not consider certain relevant issues before it.

The 2nd Respondent Union as a National Trade Union represents employees of Banks and Financial sector both. Applicant is a separate legal entity in the business of Insurance. Applicant's business operations are totally different to the manner Banks operate. Two Industries are totally different and the Industry norms are different. Although, both companies are under the same group, it cannot be considered that the Employer is the same.

Terms of employment are exclusive for each company. However, if employees are represented by different trade unions in the same Employer and If the Employer afford benefits to the members of one Union only then the situation is different. As of right, members of other Unions of the same Company could demand such benefits.

It is also pertinent to state Counsel for the Applicant drew attention of Court to Section 2 of the Trade Disputes Act (CAP 97) where Employer is interpreted.

"Employer means any person or any firm, Corporation or Company public authority or body of persons who or which has entered into a contract of service, as defined by the Employment Act, to employ any person, and includes the Government or any local government authority".

On perusal of the Terms of Reference dated 2nd October 2003 para 1 states:

"WHEREAS a Trade Union (referred to as the Union) one part and Colonial Fiji Life Limited (hereinafter referred to as the Employer) on the other part".

It is my view that Arbitration Tribunal cannot exceed the reference by the Disputes Committee. For all purposes for the Arbitration Applicant is the Employer and Arbitration Tribunal has no discretion to consider the Bank as the Employer.

At the Commencement of the Award Tribunal has clearly stated that Employer is Colonial (Fiji) Life Limited ie.

"This is a dispute between the Fiji Bank and Financial Sector Employees Union (the "Union") and Colonial Fiji Life Limited (the "Employer") concerning three unresolved issues in the Collective Agreement"

The reference was made by the Dispute Committee is whether the subject 3 clauses which were incorporated in the Collective Agreement of Colonial National Bank Ltd could be incorporated in the Collective Agreement of Colonial Fiji Life Ltd. However, I find the Arbitration Tribunal has not considered the submissions made by the Colonial Fiji Life Ltd with regard to the Composition of two companies and employees were in two difference entities. Although Counsel for 2nd Respondent submitted that this matter was not taken up by the Applicant, it is infact stated in the submissions of Applicant at Arbitration Tribunal. I did agree with the submissions made by the Counsel for the Applicant.

When Collective Agreements are entered upon it would depend on each industry. Uniform rule cannot be adopted.

Arbitration Tribunal would have clearly differentiated the Banking Industry and Insurance Industry prior to making the order.

However, Arbitration Tribunal has considered Banking and Insurance operations as one business carried out by one Employer, which is not so and reference made in the Award very clearly prove Arbitrator misdirected himself.

It is evident by the statements made in the award that Arbitration Tribunal has considered the Applicant and Colonial National Bank Ltd as one entity is incorrect.

Page 3, 2nd last paragraph

(a) "The union's claim is based on the fact that this condition is already part of the terms and conditions of Employment of employees who are engaged in the Employers Banking Operations. The Union submits that it is appropriate that there be uniformity in conditions for all employees of same employer working side by side."

My emphasis is this analysis is totally incorrect; two cadres are employed in two different Legal entities not with the same Employer. I am of the view that Arbitrator has misdirected himself and acted ultra vires.

Page 4 – 2nd last paragraph. Arbitrator continuing on same misdirection.

"The Employer appears to be claiming that because its insurance employees enjoys better sick care benefits than its banking employees, there are non contested differences in the conditions of Employment within Employer's various divisions."

My emphasis is there are no two divisions. Bank and the Insurance Company are two separate Legal entities. Employment conditions of the two companies were different. In the circumstances, uniformity of working conditions cannot be considered and it is irrelevant and misconceived.

Page 5 – paragraph 3:

"in relation to this Clause, the Union is again relying in the fact this condition is already a condition of employment for employees who are engaged in the Employers Banking Operations."

The Arbitrator continues to make same error repeating Employer's Banking Operation; in fact Employer is not engaged in Banking Operations.

Page 6 – paragraph 3:

"This condition is also part of the conditions of employment for employees who are engaged in the Employer's Banking Operations........."

This shows Arbitrator has considered Banking Operations is part of Employers Business when it is not so.

Page 7 – Tribunal refers to two Awards made:

(a) Arbitration Award No. 33 of 2002 with a dispute between Tropic Wood staff Union vs Tropic Wood; and

(b) Award No. 35 of 2004 between Fiji Electricity and Allied Workers Union vs Fiji Electricity Authority.

On perusal of the Awards, I find these two cases have no bearing in this Judicial Review. The subject Awards are made for the employees in the same industry with the same employer. These two cases are irrelevant and learned Arbitrator has misdirected himself.

On page 7, last paragraph:

In view of these observations, the Tribunal has concluded that there is no substantive reason why those employees engaged in the insurance operations should not enjoy the same operations, should not enjoy the same conditions as those employees engaged in the Banking operations. (My emphasis). This is already dealt with and no merit and Arbitrator has misdirected himself). Certainly, the Employer has not put forward any substantive proposition which would outweigh the Unions basis agreement that uniformity of terms and conditions in the work place desirable."

It is my view onus to prove this position lies on the Union not the Applicant and Tribunal has erred on law.

On page 4 last paragraph – Tribunal states:

"It should be that both parties have made a number of factual assertions which have not been formally established or tested as evidence in the cause of the hearing."

I concede even if the factual assertions are made if the Tribunal is not satisfied, Tribunal would have ordered the parties to lead evidence and/or produce further materials to substantiate their positions.

The case cited by the 1st Respondent's Counsel David Jaswant Singh vs Commissioner of Police of Fiji Court of Appeal Civil Appeal No. 46 of 1996 and Chief Constable of North Wales Police vs Evans [1982] UKHL 10; (1982) 3 All E.R. 141 do not relate to this case and order was made on different grounds.

First Respondent too cited the State vs Permanent Arbitrator Ex-Parte FPSA – Suva High Court Judicial Review No. HB 004/1995 the reviewability of the decision of a Permanent Arbitrator:

"Before so far as is necessary, setting out the relevant facts it is important to bear in mind this is an application for judicial review and not appeal. Under S.5A (b) of the Act the Award of the PA made after having heard the parties is binding upon them and therefore unless the Association can show that the PA acted illegally, irrationally with Procedural improprietary the application must fail."

Whilst agreeing on this, I state in this instance the Permanent Arbitrator has proceeded with procedural improprietary.

In Racal Communication Ltd (1980 ALL ER) page 637 Lord Diplock state:

"It proceeds on the presumption that where pertinent confers on an administrative tribunal or authority, as distinct from a Court of Law, power to decide particulars questions defined by the Act conferring the power, answering the question as it has been so defined, and if there has been any doubt as to what question is this, is a matter for Court of Law to resolve in fulfilment of their Constitutional role as interpreters of written law and expounders of common law and rules of equity. So if, the Administrative Tribunal or Authority have asked themselves the wrong question and answered that, they have done something that Act does not empower them to do and their decision is nullity."

In the present case the Arbitration Tribunal has not answered the real issue and proceeded on different issue considering Bank and Insurance are divisions of same legal entity. There is no reasonable justification for such an approach.

I conclude that Arbitration Award No. 14 of 30th March 2005 is unreasonable and/or unjustified and Arbitration Tribunal made error on law which caused procedural improprietary and acted ultra vires in the proceedings.

Accordingly, I make the following Orders:

(a) An Order of Certiorari removing the Award made by the Arbitration Tribunal No. 14 dated 30th March 2005 and quash same;

(b) A declaration that the Award took into irrelevant matters and omitted relevant matters and contained errors of law, acted ultra vires and was such not reasonable Tribunal could come to that conclusion;

(c) I Order Respondents to pay the costs of Applicant.

Delivered on 5th December, 2011.

C. Kotigalage
Judge