[1999] PNGLR 39

PAPUA NEW GUINEA

[national court of justice]

ROBERT KARAVA

V

KEVIN BYRNE; and
TOURISM PROMOTION AUTHORITY

waigani: kapi dcj
11 September 1998; 19 March 1999

Contract of Employment – Whether effectively resigned before termination – Whether procedure followed in termination – Damages equivalent to wages for the period of proper notice.

Facts

Plaintiff alleged that he was unlawfully terminated by the Chief Executive Officer (CEO) of the Tourism Promotion Authority (TPA), the first and second defendants respectively and claims for orders: 1) to quash the termination; 2) reinstatement, and 3) to award damages for loss of salary and other benefits from the date of termination.

The defendants denies liability on the basis that the plaintiff had effectively resigned from his position and therefore procedures required for terminating an officer on disciplinary grounds under the Public Service General Orders 8 and 15 are not applicable. Alternatively, the defendants argued that if the resignation was not effectively withdrawn, it had the right to hire and fire under the Terms and Conditions of Employment of TPA as well as under the common law and therefore the termination was legal and effective.

The following issues were then agreed to by the parties to be put before the court for determination: 

(a)	Whether or not the plaintiff effectively resigned before the notice of termination by the first defendant was served on him?;

(b)	In the event that there was no effective resignation, did the first defendant wrongfully terminate the plaintiff in the circumstances of this case?

Held

1.	It is clear from the evidence that the first defendant did not accept the plaintiff’s resignation but rather moved to terminate the plaintiff in his letter of May 16, 1997.

2.	Disciplinary procedures under the Public Services General Orders were not followed by the defendants in effecting the plaintiff’s termination. The plaintiff was entitled to be dealt with in accordance with the procedures set out under the said General Orders. Hence the breach of procedures resulted in the denial of natural justice and find that the plaintiff was wrongfully terminated: Kekedo v Burns Phillip & Others [1988-89] PNGLR 122 referred to.

3.	By way of relief, the plaintiff claims reinstatement to his position. The law is well settled that where a relationship between a master and servant has become noxious to either of them, the appropriate remedy is for damages for wrongful dismissal (Robinson v National Airlines Commission [1983] PNGLR 476; Appa v Wama & Department of Western Highlands [1992] PNGLR 395; Ramaram v NBC (unreported judgement of the National Court, N1110)). The relationship between the plaintiff and TPA had reached a point where he considered the possibility of resigning. The action of the CEO is an indication that there does not exist a good relationship. In the circumstances the plaintiff is entitled to damages for wrongful dismissal.

Under clause 7 of Terms and Conditions of Employment by TPA, the CEO has the power to terminate staff but it does not stipulate the period of notice required for termination. In the circumstances s 34(4) of the Employment Act Ch 373 is applicable. The plaintiff is entitled to two weeks notice. In the present case the plaintiff was given two weeks wages in lieu of notice and he is not entitled to any other damages.

Papua New Guinea cases cited

Appa v Wama & Department of Western Highlands [1992] PNGLR 395.
Kekedo v Burns Phillip & Others [1988-89] PNGLR 122.
Ramaram v NBC (unreported judgement of the National Court, N1110).
Robinson v National Airlines Commission [1983] PNGLR 476.

Counsel

J Sirigoi, for the plaintiff.
R Riddle, for the defendants.

19 March 1999

Kapi dcj. The plaintiff was employed as a Promotion Officer - Domestic in the Marketing Division of Tourism Promotion Authority (TPA). He claims that he was unlawfully terminated by the Chief Executive Officer (CEO) of TPA and claims for orders (1) to quash the decision to terminate (2) to reinstate him to his position (3) to award damages for loss of salary and other benefits from the date of termination to the date of reinstatement.

The TPA denies liability on two basis. The first is that the plaintiff effectively resigned from his position and therefore the procedures required for terminating an officer on disciplinary grounds are not applicable. Alternatively, TPA claims that if the resignation was not effectively withdrawn, it had the right to hire and fire under the Terms and Conditions of Employment of TPA as well as under the common law and therefore the termination was legal and effective.

The parties agreed to the following issues to be determined in the present case:

(1)	Whether or not the plaintiff effectively resigned before the notice of termination by the CEO for TPA took place?

(2)	In the event that there was no effective resignation, did the CEO of TPA wrongfully terminate the plaintiff in the circumstances of this case?

The plaintiff was confirmed as a Promotion Officer - Domestic in the Managing Division of TPA on the 18th April 1995. The contract of employment was open-ended. 

Resignation

It is not disputed that the plaintiff had previously indicated his desire to leave the employment of TPA on several occasions. It is also not disputed that on each of these occasions, he had withdrawn his intention to leave.

Sometimes before the notice of termination was served, the plaintiff had once again indicated his desire to leave the employment of TPA. This is clearly acknowledged in the notice of termination letter dated 16th May 1997. 

The plaintiff claims that subsequently to his notice to resign but before termination, he expressed his desire to withdraw his intention to leave and this was accepted by the CEO. Therefore, he claims that there was no effective resignation.

The CEO claims that the plaintiff did not withdraw his intention to resign and he denies that he accepted the withdrawal. 

I have considered all the evidence on both sides and the submissions put to me by counsel. 

It is common ground between the parties that the plaintiff indicated his desire to leave the employ of TPA. It is not clear from the evidence when precisely the plaintiff intended to leave. In his affidavit, the plaintiff indicated he would leave after completing the Cruise Ship Strategy. This is confirmed in the first paragraph of the letter of termination dated 16 May 1997. However, there is no indication in this letter that the CEO accepted the resignation. If that were the case, the CEO would have said so in the letter. It is clear from reading the whole of the letter that the CEO decided to terminate the plaintiff rather than to accept his resignation to take effect after the completion of the Cruise Ship Strategy. It follows from this that the resignation was not accepted. Consequently it is not necessary to consider whether there was effective withdrawal of the resignation. The notice of termination and the calculation of two weeks pay in lieu of notice are consistent with the fact that there was no effective resignation in place. If there was an effective resignation in place, the plaintiff would have been asked to leave and his entitlements would have been calculated to the effective date of his resignation. 

I therefore find that the plaintiff had not resigned his position with TPA.

Termination

The plaintiff received the notice of termination in a letter dated 16th May 1997. The plaintiff claims that the termination is wrongful in that the procedures which regulate termination of an officer for a disciplinary offence were not followed thereby breaching the principles of natural justice. 

Clause 8 of the Terms and Conditions of Employment stipulates as follows:

"All Disciplinary matters shall be resolved through the procedures and provisions of the General Orders."

It is not disputed by TPA that General Orders referred to in clause 8 is a reference to the General Orders issued under the Public Services (Management) Act 1986 (as amended). Counsel for the plaintiff relies on Public Service General Order 8 which deals with disciplinary matters. Counsel for the defendant submits that General Order 8 has been replaced by General Order 15 as at 1st March 1989. In brief the General Order provides that in respect of serious offences, there must be a formal charge which must be formally laid and served on the offender and the offender must be given an opportunity to reply within 7 days before consideration is given to whether or not the charge is sustained. 

Counsel for the defendant concedes that procedures were not followed. However, he submits that the termination in the circumstances is not wrongful in that the plaintiff had effectively resigned with effect from the 23rd May 1997. He submits that the procedure under General Order 15 does not cater at all well for disciplinary offences committed in the last week or so of a notice of resignation period. He submits that had the defendant followed the procedure set out in General Order 15, the procedure may not have been exhausted by the time the plaintiff’s resignation came into effect.

With respect I cannot accept this submission. The defendant had a choice of either accepting the resignation to take effect from after the completion of the Cruise Ship Strategy or terminating the plaintiff on disciplinary grounds set out in the notice of termination letter dated 16th May 1997. The CEO was well aware of the intention of the plaintiff to leave the employment of TPA after the completion of the Cruise Ship Strategy. Instead the CEO proceeded to terminate the plaintiff on disciplinary grounds to take effect on 16th May 1997. TPA cannot have it both ways. As I have pointed out previously, when the CEO terminated the plaintiff, he must have refused to accept the resignation of the plaintiff. In fact I find that he did not accept the resignation. The plaintiff was entitled to be dealt with in accordance with the procedures set out in the General Orders. Consequently, I find that breach of procedures result in the denial of natural justice and find that the plaintiff was terminated wrongfully (see Kekedo v Burns Phillip & Others [1988-89] PNGLR 122).

By way of relief, the plaintiff claims reinstatement to his position. The law is well settled that where a relationship between a master and servant has become noxious to either of them, the appropriate remedy is for damages for wrongful dismissal (Robinson v National Airlines Commission [1983] PNGLR 476; Appa v Wama & Department of Western Highlands [1992] PNGLR 395; Ramaram v NBC (Unreported Judgement of the National Court, N1110)). The relationship between the plaintiff and TPA had reached a point where he considered the possibility of resigning. The action of the CEO is an indication that there does not exist a good relationship. In the circumstances the plaintiff is entitled to damages for wrongful dismissal.

The plaintiff’s contract of employment was open-ended. The proper damages in these circumstances is equivalent to wages for the period of proper notice (see Appa v Wama & Department of Western Highlands (supra); Ramram v NBC (supra). Under clause 7 of Terms and Conditions of Employment by TPA, the CEO has the power to terminate staff but it does not stipulate the period of notice required for termination. In the circumstances s 34 (4) of the Employment Act (Ch 373) is applicable. The plaintiff is entitled to two weeks notice. In the present case the plaintiff was given two weeks wages in lieu of notice and he is not entitled to any other damages.

I dismiss the claim for reinstatement as well as claim for damages with costs to the defendants.

Lawyers for the plaintiff: Thirlwall Aisi &Koiri.
Lawyers for the defendants: Gadens.