Griffiths v Indian Pacific Fisheries Ltd [1997] SBHC 51; HC-CC 267 of 1994 (30 September 1997)

HIGH COURT OF THE SOLOMON ISLANDS

Civil Case No. 267 of 1994

GRANT GRIFFITHS

v

INDIAN PACIFIC FISHERIES LIMITED

Before: Lungole-Awich, J

Hearing: 23rd - 24th September 1997 - Judgment: 30th September 1997

Counsel: A Radclyffe for the plaintiff - T Kama for the defendant

JUDGMENT

LUNGOLE-AWICH, J:

FACTS OF THE CASE

The facts of this case are largely common ground. In the period before 16.3.1994, Mr. Grant David Griffiths, the plaintiff, was employed by Dive Solomons Limited in its diving business in Solomon Islands. He had the required work permit under section 68 of Labour Act, Chapter 75 of the Laws of Solomon Islands. He is an Australian and therefore is "an immigrant or non-indigenous worker." On 16.3.1994 Mr. Griffiths signed a contract of employment with Indian Pacific Fisheries Limited, the defendant. Following that, but on different occasion, Mr. Jeffrey John Waldelton, a manager in the defendant company, signed on behalf of the defendant. The contract was for the employment of Mr. Griffiths in the defendant company in a post described as Dive Operations Manager. Mr. Griffiths proceeded to Gizo and took up the employment immediately. He did not last for long; on 5.4.1994 he was told by Mr. Waldelton that his services were not necessary, and he left the employment. He was paid $3,442 for the period he worked for the defendant. After Griffiths had left, he did some work as an independent contractor, for the defendant, for which the defendant paid him $7,000. He said the work was training local villagers to dive at levels in the sea where they could obtain sea products. He now claims $16,233.50 for breach of the contract of employment. The sum is equivalent to his pay for 6 months, less the $7,000 paid to him subsequent to termination of his employment. The reason he has given is that it was a term in the contract that in the event of termination of the employment, he would be given 6 months notice or 6 months salary in lieu.

DEFENDANT'S CASE

The defendant admitted that the contract was signed between Griffiths and itself and that the clause to terminate by 6 months' notice or 6 months' salary was included in the contract. Its case was that the contract was subject to the plaintiff obtaining work permit for the employment, and that the plaintiff failed to obtain the work permit so the contract never came into being. Its second contention was that the contract was illegal because it was entered into with an immigrant or non-indigenous worker who was required, under section 68 of the Labour Act, to have permit for the employment at the time of the contract and taking up employment. The third contention was that there was a legislation of the Western Province which prohibited fishing by scuba diving, the job the plaintiff was employed to do, so his employment was illegal, could not be taken up and cannot now be enforced. At the suggestion that the Ordinance of the Western Province had, at the time of termination of employment, been only proposed and had not been made law, the defendant's answer was that the Province's policy upon which it issued licence was good ground to stop the employment which was for a job that contravened the condition upon which licence had been granted to the defendant.

THE LAW: Illegality of Contracts

Let me start by saying that after reading part VI of the Labour Act, and the Work Permit Rules, Legal Notice, No.40 of 1985, I have no doubt in my mind that the Labour Act is intended to prohibit completely, the employment of, "an immigrant or non-indigenous worker" unless the worker has obtained work permit from the Commissioner of Labour. A contract for such employment is therefore illegal and cannot be enforced. That is so even when the immigrant or non-indigenous worker has had assurance of the employer about the employer's excellent records of having successfully obtained work permits in the past. The case of Mahmond v Ispahani [1921] 2 KB 716, from England is good example of the effect of total prohibition by legislation.

There are several features of the Labour Act which led me to the conclusion that it was intended to prohibit completely the employment of an immigrant or non indigenous worker. I shall first quote the section directly in issue; it provides:

"68. (1 ) No person shall employ an immigrant or non-indigenous worker unless such worker has obtained from the Commissioner a work permit and the employment relates to the conditions of such work permit.

(2) No immigrant or non-indigenous worker whether employed or self-employed shall work in the Solomon Islands without a work permit from the Commissioner which shall specify the work which such immigrant or non-indigenous worker may undertake.

(3) Any immigrant or non-indigenous worker who wishes to work in the Solomon Islands shall, in addition to the provisions of section 8 of the Immigration Act, make application in the prescribed form to the Commissioner for a work permit provided that such application may be made on behalf of an immigrant or non-indigenous worker by any prospective employer. "

All the three subsections are concerned with the worker, whereas only subsection (1) is concerned with the employer. So in section 68 alone, the obligation of the worker to obtain work permit has been stressed three times. In subsection (3) it is made clear that it is the obligation of the worker to apply for work permit, although the application may be made, "on behalf of," the worker by a prospective employer. The employer has no obligation to apply. Subsection (3) also refers to the duty of the worker under section 8 of Immigration Act, No. 27 of 1978. Under the Act, out of the three conditions for an immigrant or non-indigenous worker to be issued with resident permit is that he will have, "obtained work permit from the Commissioner of Labour under section 68 of the Labour Act." Then penalty is provided for in section 73 against both the employer and employee. There are in addition, sections that deal with repatriation of an immigrant or non-indigenous worker. In my view, the intention of the legislation is overwhelmingly to prohibit an immigrant or non-indigenous worker from taking up employment before he has obtained work permit. Whatever a prospective employer may do in assisting the worker in applying for work permit, does not shift the obligation onto the employer.

When Relief Possible Despite Illegality

Can Mr. Griffiths obtain relief in this case notwithstanding the illegality of the contract? The first consideration is that in this case both Indian Pacific Fisheries Limited and Mr. Griffiths were aware of the requirement of the Labour Act and therefore the illegality that would arise if Mr. Griffiths took up the employment without work permit. It is therefore a case where both parties were in delicto.

What about the effect of the statement of Mr. Griffiths that Mr. Thompson, Company Secretary of the defendant company, acting for the defendant, told him that Mr. Thompson had got the permission of the Commissioner of Labour, and that Mr. Griffiths could work in the mean time? That is the one feature of this case that I considered granting relief on, but declined in the end. The reason for declining is that I do not believe Mr. Griffiths's statement about Mr. Thompson's utterance about permission. There are three reasons for not believing Mr. Griffiths. The first is that he also stated that it was agreed that Mr. Thompson was to do the paper work. That implies that there was no permission. In cross-examination he said that undertaking was given to Mr. Thompson that he, Griffiths could work on the work permit issued for employment with Dive Solomons. In any case I think a person with Mr. Griffiths's experience of working on work permit for 7 years would have asked for a letter of permission. The second reason is that Mr. Griffiths contradicted himself about work permit. He said that he first saw only in October 1994, the letter of Senior Immigration Officer dated 12.4.1994 now exhibit No.8. In the letter it was stated that the Commissioner of Labour had confirmed (to Immigration) that no work permit had been issued to Mr. Griffiths to work for Indian Pacific Fisheries Limited and further that Mr. Griffiths was "to cease his employment w.e.f. the date of this letter." In cross-examination, he said that he left for Australia in July because his appeal for work permit had failed and he had to leave the country. If so he must have known earlier than the day he left in July, that his application for work permit had not been successful. The third reason is that the plaintiff, after termination of his employment, worked as an independent contractor with the defendant and the defendant paid him $ 7,000. He said that the work involved teaching villagers to dive, the villagers obtained sea products they sold to the defendant. That seems to have been a way to overcome difficulty about work permit, not to overcome the difficulty about illegal method of fishing. It is to be noted that he stated that he still had valid work permit, "under" Dive Solomons, and that although the work was done through Paro Corporation, the payment was made to him personally.

Even if I were to believe that Mr. Thompson uttered the words that he, "had got the permission of the Commissioner of Labour, and Mr. Griffiths could work in the mean time," there would still be difficulty in deciding the effect. Did the words amount to a promise or definite assurance by Mr. Thompson? I first thought so, but upon considering the context I concluded that it was merely an advice that Mr. Griffiths could work. In fact Mr. Griffiths used the words "could work." Had I concluded that the statement was a definite assurance, a positive statement, I would have considered granting relief based on a cause of action distinct from the illegal contract, such as warranty or negligence. The question of those causes not having been pleaded would have arisen. In view of the fact that under the Labour Act the overwhelming obligation is on the plaintiff to obtain work permit, I decline to allow relief on any statement less than a clear deceitful statement that work permit had been obtained. I have not found that to be the position. There is no cause of action distinct from the contract of employment dated 16.3.1994 between Grant David Griffiths and Indian Pacific Fisheries Limited, which contract is illegal and cannot be enforced.

In addition to the reasons I have given, I have considered cases in other jurisdictions. Two cases from England had facts close to this one. The cases are Mahmond v Ispahani [1921] 2 KB 716 and Strongman v Sincock [1955] 2 KB 525 also [1955] 3 All E R 90. In the former, the defence of a buyer of linseed oil that the contract was illegal because the buyer did not have licence succeeded although before the sale, the seller, the plaintiff, had inquired of the buyer whether the buyer had licence and the buyer had lied that he had the licence. The Court of Appeal decided that the contract was prohibited and could not be enforced. In the later case, builders who did building work for an architect without permit recovered from the architect. The reason was that the architect had given a warranty that he would obtain the permit or stop the builders. In my view this case is distinguishable from Strongman's. The Labour Act makes it the obligation of the worker, not of the employer to apply. Further in Strongman's case the claim was specifically brought as being based on the warranty, a collateral contract, not on the illegal contract. In this case paragraphs 5 and 6 of the statement of claims state clearly that Mr. Griffiths's claim is based on the contract dated 16.3.1994 which contract I have decided is illegal. Another distinguishing feature is that in Strongman's case, illegality was advanced as a defence based on the dictum, ex turpi causa non oritur actio (no action on illegal cause), by a defendant guilty of the illegality, but had received benefit out of it at the expense of the plaintiffs who had conferred benefit and received nothing out of it, and were not in delicto. In this case, Mr. Griffiths, the plaintiff, had not given value for the 6 months; he had expectation from the illegal contract and was mainly responsible for the illegality or at least equally responsible. The defendant had not received benefit out of the illegal contract. In effect the defendant is being asked to perform a term of the illegal contract so that Mr. Griffiths gains benefit from it. I view Mr. Griffiths's case as being that the defendant cannot raise his illegality in defence to escape liability for a claim brought by an innocent party; it is based on the dictum in pari delicto potior est conditio defendentis seu possidentis. I do not think that is correct; the plaintiff's case cannot succeed because both are at fault, with the greater responsibility resting on the plaintiff. Enforcing the claim of the plaintiff only leads to enforcing the illegal contract. Labour and Immigration authorities must be happy that they thwarted the illegal contract at commencement. The defendant has not, in any case, gained unfairly out of the illegal contract. The claim of Mr. Griffiths based on the contract dated 16.3.1994 cannot be enforced, it is dismissed.

THE OTHER DEFENCES

It is not necessary to consider the other defences put forward but, as learned counsel laboured at them I shall decide them, subject to the determination already made above.

The submission of learned counsel Mr. Kama, about licence would not succeed. A condition in a business licence of an employer cannot be accepted as reason to dismiss an employee. It is upto an employer to ensure that he employs only people whose jobs will not contravene conditions in the employer's licence or to assign employees to jobs that do not contravene condition in the licence. The defence based on illegality of scuba fishing would also not succeed even if the relevant Ordinance of the Western Province had come into force by the time that the plaintiff was employed. The reason is a straight forward one. The contract dated 16.3.1994 at paragraphs D and F stated other jobs in the descriptions of the plaintiff's duties. Those other jobs would not contravene the Ordinance banning fishing by scuba diving. The illegality that would arise would be severable and avoided.

I have already determined that the contract between Grant David Griffiths, the plaintiff and Indian Pacific Fisheries Limited, the defendant, dated 16.3.1994 is illegal and cannot be enforced. The plaintiff's claim is dismissed.

In the circumstances, I decline to award costs to the defendant.

The office files of references 514/90 and L17/D/7 are to be returned to Director of Immigration and Commissioner of Labour.

Dated this 30th day of September 1997

At the High Court, Honiara

Sam Lungole-Awich,
Judge