Teaeki v Air Kiribati Ltd [2015] KIHC 38; Ciivl Case 176 of 2012 (26 June 2015)

IN THE HIGH COURT OF KIRIBATI 2015

CIVIL CASE NO. 176 OF 2012

BETWEEN

MOTE TEAEKI
PLAINTIFF

AND

AIR KIRIBATI LTD
DEFENDANT

Before: The Hon Chief Justice Sir John Muria

26 September & 30 October 2014

Ms Eweata Maata for Plaintiff
Mr Monoo Mweretaka for Defendant

JUDGMENT

Muria, CJ: This is a claim by the plaintiff for damages for unlawful termination of employment.

BRIEF BACKGROUND

The plaintiff entered into an Agreement with the defendant in 2005 whereby he was appointed as "the Agent" of the defendant, Air Kiribati Ltd on Onotoa Island. The terms of the plaintiff's Agency contract are set out in the Agreement which is a standard contract appointment for all agents of the defendant in the country.

In April 2012, a spot-check was made on the plaintiff's sales and discovered a shortage of $225.00. As a result of the spot-check, the plaintiff's agency was terminated.

ISSUE

The main issue to be determined in this case is whether the defendant was entitled to terminate theplaintiff's agency under the Agreement entered into between them in 2005. A subsidiary issue which, in this case, is of less importance to the outcome of this case is whether the relationship between the plaintiff and the defendant was one of an agent and principal relationship.

ARGUMENT AND DETERMINATION

Ms Maata of Counsel for the plaintiff pressed the plaintiff's case on two points. First, it is submitted that the termination of the plaintiff's employment was unlawful on the basis that the plaintiff was not given an opportunity to be heard before his termination. The plaintiff's second argument is that it was unreasonable to terminate the plaintiff's employment since he had already sent the money by Telmo to the defendant.

I think it is appropriate that I deal with the appellant's second argument. The question of the reasonableness of the termination of the appellant's employment is a question of mix fact and law in the present case. The plaintiff was the defendant's appointed agent on Onotoa Island. Part of his duties and responsibilities was to collect air-fares and air-freights sales proceeds and to send them to Tarawa by cash box provided on the plane for that purpose.

On 24 April 2012 a spot-check was made on the plaintiff's work in Onotoa. It was discovered that the sales for the period 17-23 April 2012 was $844.70. Of that sum, only $620.00 was sent by the plaintiff, as usual, in the cash box by plane to Tarawa. There was a shortfall of $225.00 which is not denied by the plaintiff. The spot-check was done on 24 April 2012 by one Kamatie from the defendant's office when the shortfall was found. Yet, according to the plaintiff, he sent the shortfall amount at 1550 hours after the plane left on 24 April 2012 by telmo through TSKL.

In addition to the fact that sending money by telmo was not the accepted practice of the defendant and all the defendant's Agents, including the plaintiff, knew that there are a number of reasons why the plaintiff's argument is on a very weak footing. First, it is clear from the materials before the Court that the telmo was dated 24 April 2012 but was sent after24 April 2012. In fact, the Clerk to the Council in Onotoa in his letter dated 13 August 2012 confirmed that the telmo No. 809554 dated 24 April 2012 in the amount of $225.00, code word VOTE/CHIN, was put through the Council. The telmo was then sent the next day 25 April 2012 at 0912 hours and received by one Mika at TSKL.

Secondly, the payee under the telmo was Tokobea at Air Kiribati Bonriki. Even by 3 August 2012 when the plaintiff's agency contract was terminated, Tokobea had not yet received the telmo sum. The TSKL stamp on the copy of the telmo showed that the telmo was received by TSKL on "16 August 2012". See Annex "B" to the plaintiff's affidavit dated
12 October 2012, yet the payee has still not received the telmo sum. It can hardly be surprising that the defendant was bound to take the very stern approach that it took on 3 August 2012 of terminating the plaintiff's agency appointment.

Thirdly, the evidence has established that this was not the first time that the plaintiff was caught with shortfalls in his sales while he was the Agent of the defendant in Onotoa. The first incident was in 2007 for which he was warned. The second time was 2011 for which he was warned and strongly reprimanded. Hewas expressly told in writing that "If this happens again, then no more warning will be issued and that you will be dismissed". The plaintiff cannot now be heard to say that he was surprised to be terminated from his employment.

His argument is also that because he paid the shortfall, the defendant should not terminate his Agency appointment. Unfortunately, the defendant's right to terminate his appointment was not depended on his repayment of the shortfall but rather on breaches of the terms of his contract of agency appointment. The fact that the plaintiff had to pay back the shortfall serves two purposes in his favour, namely, to relieve him of his debt to the defendant and secondly, to relieve him of a possible criminal case which the defendant could well pursue by reporting him to the police for the missing shortfall.

Fourthly, the defendant retains its right to hire and fire with or without cause. There is no such thing as a right to be employed until retirement or until the end of an appointment contract. Those who reached retirement age in employment were those who conformed to the terms and conditions of service in their employment. There were others whose employments were justly terminated for breaching their employment terms and conditions well before they reached retirement age.

In the present, the evidence established that the defendant has justifiable reasons to terminate the plaintiff's appointment as its Agent on Onotoa Island. The defendant is not entitled to notice pay. He is, however, entitled to any outstanding salary, allowance and benefits owing to him. But he is not entitled to four (4) years' salary as claimed.

I briefly deal with the argument that his termination was unlawful because he was not given an opportunity to be heard. I do not think that the plaintiff can successfully mount this argument. He was visited in April 2012. He had his opportunity to explain his part in the shortfall. Again in August, he was visited again by the defendant's staff. He had the opportunity to explain his side of the story about the shortfall in the sales. Shortly after the August visit, he was given a letter terminating his appointment as agent of the defendant in Onotoa Island. I do not accept the argument mounted on his behalf that he was deprived of his right to be heard before the defendant terminated his agency contract. His argument on this point is rejected.

As a comment by the way, I simply wish to add that, while some agents are employed and so come under the principal and servant relationship, there are other agencies that operate as separate private entities. If I may suggest that the better course in cases of this nature between an airline and agent who performs services on behalf of the airline, is to enter into a more straight forward Agency contract whereby the Agent is entirely a separate entity performing an agency contract of service on behalf of the airline company, rather than under an employee/employer contract relationship.

As I have said the plaintiff's case in the present cannot succeed. It is therefore dismissed with costs to be taxed, if not agreed.

Dated the 26thday of June 2015

SIR JOHN MURIA
Chief Justice