Baiwan v University of Papua New Guinea [1995] PNGLR 18 (30 October 1995)

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MASTER AND SERVANT - Contract of employment - Termination of service - Propriety of procedures.

The plaintiff was employed by the defendant as deputy manager of the Division of Estates and Planning for a period of three years. The defendant terminated the plaintiff’s service some 17 months prematurely, alleging serious misconduct and non-performance of duties.

The plaintiff’s claim for wrongful dismissal was based on an alleged procedural defect in the termination of his contract.

1. The relevant clause on termination in the contract required “due and proper inquiry” into any allegations of misconduct as a condition precedent.

2. The requirement for “due and proper inquiry” may be different from the principle of natural justice in public law - one requirement of which is the right to be heard.

3. “Due and proper inquiry” must mean an inquiry which is objectively reasonable in the circumstances.

4. In a master-and-servant relationship, there cannot be specific performance of the contract; but termination, if effected in a manner in violation of the terms of the contract, would give rise to damages for breach.

5. Where the charges and particulars thereof were served on the employee, he was given the opportunity to respond, and he exhausted the appeal processes, on an objective test of reasonableness, it is clear that the employer acted reasonably and circumspectly.

ANDREW J: This is a claim for damages for breach of a contract of employment. The plaintiff was employed by the University of Papua New Guinea as Deputy Manager of the Division of Estates and Planning by a contract of employment for a period of three years from 7 February 1992. The plaintiff was effectively terminated on 20 August 1993, some 17 months before the due expiration of the contract, upon various grounds of alleged serious misconduct and non-performance of duties.

There are three main grounds upon which the plaintiff claims wrongful dismissal, namely:

“1. The defendant failed to conduct a ‘due and proper inquiry’ into the allegation or charges against the plaintiff before dismissing him thus breaching his contract of employment.

2. The defendant denied or did not accord the plaintiff the principle of natural justice, when charging and determining the allegations against the plaintiff, and

3. The defendant did not conduct a proper enquiry into the allegations as charged against the plaintiff.”

“1.1. The defendant when dismissing the plaintiff from his employment, initially on 4 August 1993 and subsequently when confirming that decision on 27 August 1993, following appeal, did not:

(a) make available to the plaintiff all or any statements or evidence (documentary or otherwise) made against the plaintiff from which the charges were brought to enable the plaintiff to properly respond;

(b) accord to the plaintiff any or reasonable opportunity to examine the statements, documents, witnesses or whatsoever that the Registrar relied upon to arrive at the finding against the plaintiff;

(c) accord to the plaintiff any or reasonable opportunity to produce and including calling witnesses to counter (sic) the case against him;

(d) observe the rules of natural justice in that the Registrar acted as the prosecutor and judge by charging and determining the charges against the plaintiff.”

It is apparent that the plaintiff is largely challenging the manner and the procedures involved in the termination of his contract. He was originally charged on 15 July 1993 and dismissed on 22 July 1993 and then subsequently reinstated on 4 August 1993, re-charged on the same day, and ultimately dismissed on 20 August 1993. The particulars of the charges against the plaintiff alleged, in brief, various acts of disobedience and disruption; various acts of inappropriate behaviour, such as refusal to obey or carry out instructions and complete certain projects; various instances of insubordination, disrespect and use of insulting language in official correspondence; various instances of undermining the authority of the head of the Department of Buildings and Estates; and frequent disruption of the work and activities of the department.

As the central issue here involves the manner and procedure of the plaintiff’s dismissal, the relevant clause as to termination in the contract of employment is set out:

After due and proper inquiry and subject to any Statute on tenure of Non-Academic Staff, the Vice-Chancellor or Registrar may dismiss or temporarily suspend and stop payment of the salary of a staff who has grossly or persistently neglected his duties as specified in Section 2 hereof, or has otherwise been guilty of serious misconduct in or affecting the performance of such duties or of serious misconduct affecting property and/or the welfare of the University in general.

3.4.5 After due and proper inquiry, and subject to any Statute on tenure of staff, the Vice-Chancellor or Registrar may, for such period as he may determine, not exceeding one year, suspend a staff from his duties without loss of salary if he believes such suspension to be in the best interests of the University, provided that after termination of such period of suspension imposed by the Vice-Chancellor or Registrar, the Council shall decide whether other periods of suspension may be imposed by the Council immediately or after a specified interval.”

Clause 3.4. provides that “after due and proper inquiry and subject to any Statute on tenure of Non-Academic Staff, the Vice-Chancellor or Registrar may dismiss ... a staff who has grossly or persistently neglected his duties ... or has otherwise been guilty of serious misconduct affecting ... such duties ...”. The plaintiff referred to a document entitled “The University of Papua New Guinea Terms and Conditions” and sought to place reliance upon this as a statute applying to him by virtue of cl 3.4. That document refers, inter alia, to the service of charges; the powers of the Vice-Chancellor to suspend staff pending inquiries; rights of the employee to request committees of inquiry to verify charges other than by the Vice-Chancellor; and the manner in which such a Committee of inquiry is to conduct such an inquiry. I am satisfied, however, that this document is not a statute in the context of the University. It is not subsidiary legislation made under the University of Papua New Guinea Act Ch 169, but remains only a discussion paper which has not come into force. That was confirmed in evidence by Mrs Christine Linge, the Deputy Registrar - Staffing and by Mr Thoa Iamo, the Registrar. There is no such statute in existence in relation to non-academic staff, and the plaintiff’s rights on termination are to be determined under the terms of the contract of employment itself. The plaintiff was originally charged, dismissed, and then reinstated when it was discovered that this document had not come into effect. That was the reason he was re-charged and proceeded against in the manner which is now disputed.

The requirement for “due and proper inquiry” may be different from the principle of natural justice in public law - one part of which principle is the right to be heard. In master-and-servant cases, the principle is set out in Ridge v Baldwin [1963] UKHL 2; [1964] AC 40 at 65, which has been quoted in Malai v PNG Teachers Association [1991] PNGLR 116 at 122 and Busu v PTC [1993] PNGLR 321 at 324:

“The law regarding master and servant is not in doubt. There cannot be specific performance of a contract of service, and the master can terminate the contract with his servant at any time and for any reason or for none. But if he does so in a manner not warranted by the contract he must pay damages for breach of the contract. So the question in a pure case of master and servant does not at all depend on whether the master has heard the servant in his own defence: it depends on whether the facts emerging at the trial prove breach of contract.”

“Due and proper inquiry” is not a term which is susceptible to precise definition but must mean such an inquiry which is objectively reasonable in the circumstances. The term “due inquiry and search” under s 54 (1) of the Motor Vehicles (Third Party Insurance) Act Ch 295 was considered in Mangoi v MVIT [1990] PNGLR 327, where Woods J found that due inquiry and search must be made at the time of the accident or soon thereafter and such inquiry and search must be objectively reasonable in the circumstances. I think that the test of whether due inquiry was made in the particular circumstances of any case is what a reasonable person ought to have done in the circumstances, and this is an objective test and not a subjective one.

The defendant has called evidence from Mr Thoa Iamo, the Registrar of the UPNG and from Mrs Christine Linge, the Deputy Registrar - Staffing. I am satisfied that both were truthful witnesses whose evidence can be relied upon. Mrs Linge had been with the university since 1975 and Mr Iamo since 1981. They both appeared as honest and capable persons with an obvious knowledge and competence in matters of administration at the university. I am satisfied on their evidence of the following facts: Mr Iamo, in his role as Registrar, made such inquiries as interviewing heads of divisions, such as the Bursar, and the Head of Buildings and Estates, the Vice-Chancellor and Deputy Vice-Chancellor, and a number of employees in Buildings and Estates. He consulted documents, including memorandum written by various divisional heads. The charges were put to the plaintiff in Mr Iamo’s letter of 4 August 1993. The particulars of the charges were attached. The plaintiff was given the opportunity to respond to the charges, which he did by letter of 11 August 1993. He did not request to make oral submissions. Mr Iamo considered the reply to the charges, and he then interviewed or spoke to other senior executives before deciding to terminate the plaintiff. The plaintiff was invited to appeal against the decision to terminate, which he did. I am satisfied on the evidence of Mrs Linge that the University Council, under the University Standing Committee, appointed an appeal committee to determine the plaintiff’s appeal. The committee comprised the Chancellor, who was chairman; Mrs Winifred Kamit as Council member; the Deans’ representative, Dr Bruce Yeates; Mrs Florence Griffin, as the most senior member of the non-academic staff; and two further council members, Dr Naomi Tulaha and Dr Mosley Moramoro.

The plaintiff was invited to make oral representation, but he wrote to them saying he would not make any representation to the appeals committee. The committee convened some six times, and the Registrar and six members of Buildings and Estates staff were called for further questioning. Mrs Linge, who acted as secretary to the committee, estimated that it spent about 12 hours considering the plaintiff’s appeal.

The Registrar was required to act fairly. There is no evidence to show that he did not do so. There is nothing to show that he was biased or acted unreasonably. On the contrary, the evidence shows that he acted with scrupulous fairness and thoroughness. “Due inquiry” means that the tribunal must hear all relevant matters and must give the charged person the opportunity to be heard. I am satisfied that all of this was done. On an objective test of reasonableness, it is clear that both the Registrar and the appeal committee, in all of the circumstances, acted reasonably and circumspectly.

The plaintiff argues that “due and proper inquiry” relates to his being charged. But “due and proper” inquiry includes all matters up to the point of termination, including inquiries, investigations, the plaintiff’s reply to the charges, and all matters considered by the tribunal. He argues further that he was not represented on the appeal committee by a member of NANSA (Non-Academic National Staff Association), but this was based upon the mistaken belief that he was so entitled due to the document “Terms and Conditions” being in force. As already said, this document was not in force. A third basis for challenging the partiality of the appeal committee was that one of its members was biased.

In support of this, some documentation was tendered showing differences of opinion over matters of maintenance between the plaintiff and Mrs Griffin. But this had taken place some two years previously. Mrs Griffin offered to stand down from the committee, but was requested to remain by the Chancellor. She was appointed because she was the most senior non-academic staff member. I do not think that it is shown that she was biased in any way, and it appears that she acted with all due propriety.

The issue here is the construction of the plaintiff’s employment contract, which provided for “due and proper inquiry” as to the procedures to be used for termination. There is no express definition in the contract as to what form “due and proper” inquiry should take. I am satisfied that the procedures adopted were scrupulously fair and they were reasonable. The Registrar and the appeal committee were not courts of law bound by the rules of evidence. I can find no miscarriage of justice.

I, therefore, dismiss the plaintiff’s claim and give judgment to the defendant.

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Papua New Guinea Law Reports

Baiwan v University of Papua New Guinea [1995] PNGLR 18 (30 October 1995)

PNG Law Reports 1995