Tonga Communications Corporation Ltd v Fonua [2005] TOCA 8; AC 11-2004 (21 July 2005)

IN THE COURT OF APPEAL OF TONGA
CIVIL JURISDICTION
NUKU’ALOFA REGISTRY

APPEAL NO. 11/2004

BETWEEN:

TONGA COMMUNICATIONS CORPORATION LIMITED
Appellant

AND:

SIOSAIA H. FONUA
Respondent

Coram: Webster CJ
Burchett J
Tompkins J

Counsel: Mr S. T. Tu’utafaiva for the Appellant
Mr L. M. Niu for the Respondent

Date of hearing: 12 July 2005
Date of judgment: 21 July 2005

JUDGMENT OF THE COURT

[1.] Mr Fonua, the Respondent, was the Chief Engineer of the Tonga Telecommunication Commission the liabilities of which – including “debts ... duties and obligations of every description (whether present or future, actual or contingent ...)” – were by s.7 of the Tonga Communications Corporation Act 2000 transferred to and became liabilities of the Appellant Tonga Communications Corporation Limited. Following a series of incidents recounted in detail in the judgment from which this appeal comes, it was made very clear to Mr Fonua that if he did not resign from the Commission, he would be charged in disciplinary proceedings with serious misconduct and might be dismissed. He chose to resign.

[2.] Subsequently, Mr Fonua brought a wrongful dismissal action against the Appellant. That action failed, so far as it sought damages for the alleged wrongful dismissal of the Respondent, it being held that Mr Fonua’s resignation was tendered of his own volition, notwithstanding that his motive was to avoid the hazards of a disciplinary proceeding. But, as to one matter which has led to this appeal, the Respondent succeeded. He was held entitled to receive a pension pursuant to the Commission’s pension scheme.

[3] Of the pension scheme, the evidence was extraordinarily scanty. However, it was sufficient to sustain a finding that the provisions of The Pensions Act (Cap.8), which applies to the public service of Tonga, had been adopted by the Commission as stating the terms on which it would grant pensions to its employees.

[4.] The difficulty that then faced the Respondent lay in the matter of his age. He was only 49 years old when his resignation took effect. Section 6 of The Pensions Act provides:

6. Except in cases of abolition or reorganization of office no pension, gratuity or other allowance shall be granted to any public officer who has not attained the age of 50 years unless on medical evidence to the satisfaction of the Privy Council that he is incapable by reason of infirmity of mind or body of discharging the duties of his office and that such infirmity is likely to be permanent:
   

Provided that if the officer although not suffering from any particular illness or infirmity of mind or body likely to be permanent becomes unfit in the opinion of the Privy Council for the discharge of the duties of the office to which he has been appointed and such unfitness is not attributable to misconduct or gross negligence if the Privy Council consider that the special circumstances of the case justify the grant of a pension to him he may with the consent of the Privy Council be retired on a pension and be pensioned at a rate of pension not exceeding that for which he would be qualified if he were suffering from an illness or infirmity likely to be permanent:

Provided further that if an officer is transferred to other public service as defined under regulations under this Act and ultimately retires at an age being less than 50 years at which he is permitted by the laws or regulations of that service to retire with a pension the pension which may be granted to him from the revenue of the Kingdom under this Act and the regulations thereunder shall be payable from the date of retirement of such officer notwithstanding that he shall not be 50 years of age.

[5.] In the judgment under appeal, the difficulty was recognized, but it was held that s.6 did not deny a pension upon a resignation before the age of 50 years; it merely postponed the receipt of it until the attainment of that age. The appeal raises the short point whether this construction of the section can be accepted.

[6.] One of the problems about the Respondent’s approach to the meaning of the section is its open-endedness. It would leave no stopping point. At however early an age a qualified public officer might resign, that resignation would create a potential pensioner in the future. No sensible policy reason for such a situation is apparent – particularly in the case of a non-contributory pension.

[7.] Section 6 is limited by careful provisos enabling early retirement with pension for (among others) the permanently unfit through illness and also for persons who have transferred to other public service where early retirement is permitted. The reference to retirement “at an age being less than 50 years at which [an officer] is permitted by the laws or regulations of [some other] service to retire with a pension” clearly implies that officers of the Tongan public service are not in general permitted to retire with a pension (that is, with a right to a pension) at an age being less than 50 years.

[8.] Mr. Niu, in attempting to support the construction of s.6 that would allow a pension to be paid, notwithstanding an earlier resignation, upon an officer attaining the age of 50 years, referred us to ss 2 and 4 of The Pensions Act where the expression is used “persons who have been in the public service of the Kingdom” to describe those who may be granted a pension. But each of these sections makes it clear the grant must be “in accordance with” the regulations, which are contained in the Schedule to the Act, and regulation 2 specifies that an officer’s pension “may be granted on his retirement” (emphasis added). It is not granted later to one who has been an officer.

[9.] The Respondent also sought to rely on the proposition that some other employees, or at any rate another employee, had been permitted by the Commission to retire with a pension before attaining the age of 50 years. However, on examination, the example relied upon was revealed as rather supporting the Appellant’s case. For it turned out that, at a preliminary stage in the determination of the application in question, the payment of a pension was proposed; but upon further consideration, the point concerning the age of retirement being raised, the Board of the Commission unanimously decided the applicant was ineligible for a pension, and made other provision.

[10.] For these reasons, we conclude that the Respondent could not have been granted a pension on his retirement, which occurred at the age of 49 years, pursuant to the only applicable pension scheme. It follows that the appeal must be allowed. However, the question of the true construction of s.6 is a large one, affecting the public service of Tonga and the employment of many persons by the Respondent. When an appeal involves a public body with much wider interests to serve in obtaining an appellate ruling than the personal interest of the other party, the Court on the appeal has a discretion with regard to the costs. In the circumstances, it is appropriate that the order of the Court be: the appeal is allowed and the Respondent’s action is dismissed and the order for costs made below is set aside, but no order is made with respect to the costs of the action or the appeal.

WEBSTER CJ
BURCHETT J
TOMPKINS J