Government of Vanuatu v Mathias [2006] VUCA 7; CAC 10-06 (1 June 2006)

IN THE COURT OF APPEAL
OF THE REPUBLIC OF VANUATU
(Civil Appellate Jurisdiction)

Civil Appeal Case No. 10 of 2006

BETWEEN:

GOVERNMENT OF VANUATU
Appellant

AND:

EPHRAIM MATHIAS
Respondent

Coram: Hon. Justice John W. von Doussa
Hon. Justice Daniel V. Fatiaki
Hon. Justice Hamlison Bulu
Hon. Justice Oliver A. Saksak

Counsel: Mr. Tom J. Botleng & Ms. Florence William for Appellant
Mr. John Malcolm for Respondent

Date of Hearing: 24 May 2006
Date of Decision: 01 June 2006

JUDGMENT

This is an appeal against a decision of the Supreme Court at Port Vila in which the trial judge awarded the Respondent Ephraim Mathias in a claim of unjustified dismissal, a sum of VT1,166,408 made up as follows: -

(1) Three (3) months salary in lieu of notice	VT312,768
(2) Severance payment under s.56 of the Employment Act [Cap.160]	VT803,640
(3) Common law damages for the manner of dismissal	VT 50,000

Interest at the rate of 5% p.a. was also awarded on the judgment sum to run from the date of filing of the claim i.e. 28th October 2004 until payment with costs on a standard basis.

The Respondent had been employed by the Government of Vanuatu since April 1989 and had risen to the very senior position of Commissioner of Labour at the time of his dismissal in October 2004. At the time he was on a monthly salary of VT104,256.

By letter dated 20th July 2004 George Pakoasongi, the Secretary of Public Service Commission ('PSC') informed the Respondent that a written complaint had been laid against him by the then Minister of Internal Affairs alleging:

"1. Work Attendance (viz: absenteeism)

2. Misuse of Government Vehicle G341
   3. Malpractice and Abuse of power"
      

The precise details and evidence in support of the allegations were contained in the Minister's written complaint dated 14th April 2004 and in a special investigation report compiled and prepared by Lionel Kaluat the Deputy Commissioner of Labour which contained in excess of 100 pages. Both documents were provided to the Respondent under cover of the letter of 20th July 2004. The letter also sought the Respondent's written response to the allegations within 21 working days.

By letter dated 10th August 2004 the Respondent responded to the allegations. In brief, the Respondent denied any wrong doing.

By letter dated 1st October 2004 the Acting Secretary of PSC formally advised the Respondent of the PSC's decision taken on 21 September 2004, that he be " immediately dismissed from service without any benefits under section 29 of the Public Service Act No. 11 of 1998".

On 22nd October 2004 the Respondent issued Supreme Court proceedings against the PSC and the Appellant claiming severance allowance for unjustified dismissal and common law damages for defamation as well as for breach of an (unspecified) implied term in the Respondent's employment contract.

The Appellant whilst admitting the respondent's dismissal nevertheless asserted that it was done in a lawful manner. In particular, the Appellant asserted in paragraphs 6 & 7 of the Statement of Defence as follows:

"6. The defendant ... said the claimant was informed through the PSC secretary's letter to the claimant dated 6th May 2004 that a complaint was made against him and that investigations into his conduct would be carried out. Furthermore the claimant was informed of the three charges against him through PSC secretary's letter to the claimant dated 20th July 2004.

7. The defendant ... says through PSC secretary's letter to the claimant dated 20th July; the claimant was informed of the charges against him and was given the opportunity to respond. The claimant responded to the charges on or about the 10th August 2004."
   

No attempt was made however, in the Statement of Defence either to explain or justify the Respondent's dismissal i.e. how it was being asserted "the dismissal was lawful".

In this regard Rule 4.5 of the Civil Procedure Rules No. 49 of 2002 expressly provides:

"(3) A defendant must not deny the claimants claim generally, but must deal with each fact in the claim.

(4) If the defendant does not agree with a fact that the claimant has stated in the claim, the defendant must file and serve a defence that:

(a) denies the fact; and

(b) states what the defendant alleges happened."

It is plain on the face of the Appellant's pleadings that Rule 4.5 (4) (b) above had not been complied with. Indeed it appears sufficiently clear from the pleadings in the Statement of Defence (esp: paras 14 & 24) that the Appellant considered that the Respondent bore the burden of disproving the allegations and charges that had been made against him.

It is perhaps unfortunate that this misconception and the inadequacy in the Appellant's pleadings were not corrected during the several case management conferences that occurred prior to the trial or indeed during the course of the trial. Had this occurred it is most unlikely that the trial proper would have derailed as it did.

On this aspect we draw attention to the helpful and detailed provisions contained in Rule 6.6 of the Civil Procedure Rules which sets out the purpose and the respective duties of the parties and the judge at the trial preparation conference (TPC). These include - the precise identification and definition of the issues (in dispute) between the parties and the evidence needed to prove them; indicating the number of witnesses that is proposed to be called by the parties as well as any agreed facts; fixing dates for the exchange of sworn statements and agreed bundles of disclosed documents (if not already done); and the giving of directions for the further preparation of the trial by the judge conducting the TPC.

It is noteworthy that the author of the special investigation report that contained much of the evidence in support of the several allegations made against the Respondent did not provide a sworn statement to the Court identifying and/or producing the report as might be expected would have been directed by the judge conducting the TPC at the very least. Nor was he available to be cross-examined at the trial proper.

Instead the only sworn statement and witness called by the Appellant at the trial was the secretary of the PSC who, not being the author of the special investigation report or of the primary documents referred to in it, was unable to produce the report at the trial over the objection of the Respondent's counsel.

For his part, the Respondent provided a sworn statement and produced his dismissal letter. At the trial however he withdrew paragraphs 12, 13 & the third sentence of paragraph 14 (highlighted) of his sworn statement which appears in the following context and reads as follows:-

"11. It is a sad thing as I was prepared to leave anyway. It seems they just wait to discredit me and not pay me what is due.

12. I say the above as a result of a secret report being done by Kaluat from the day he started. I annex "C (TAB 3)" the report used to dismiss me dated 14 April 2004.
    
    13. I refer the Court to the document starting at page 49 (my enumeration) indicating a confidential report dated 31 December at page 42 another strictly confidential report dated 4 March 2004.
        
    14. The first time I became aware of an actual investigation was on or about 20 July 2004. I annex "D (TAB 4)" the letter received. The written complaint attached seemingly written on 14 April 2004 some 31/2 months before is the document annexed hereto as C in (TAB 3).
        
    15. On 10 August 2004, I provided a written response as requested. I annex "E" (TAB 5) my response."
        

This withdrawal by the Respondent and the subsequent successful objection to and deletion of paragraphs 2, 3, 4, 5, & 7 of the sworn statement of the Secretary (PSC), the sole witness called by the Appellant at the trial, had the critical result of effectively excluding from the trial evidence (exhibits) and therefore the trial judge's consideration, the special investigation report and its several annexures.

As the trial judge was driven to observe in his judgment (at P7):

"In his sworn statement Mr. Pakoasongi said at paragraph 8 that "the Claimant was provided copies of all documents in respect to the allegations against him" however Mr. Pakoasongi did not specify which documents were supplied to the Claimant and there was no other evidence on behalf of the Defendant in that regard and the Claimant was not cross-examined as to that. As I said above, while Mr. Pakoasongi had filed a sworn statement as to the First and Second Defendants' list of documents on 18 May 2005, there were no substantive admissible evidential sworn statements producing any of that material to the Court."

In this latter regard Rule 11.4 (2) of the Civil Procedure Rules No. 49 of 2002 clearly states:

" ... a sworn statement must not contain material, or refer to documents, that would not be admitted in evidence" .

And Rule 11.7 (1) provides:

"A sworn statement that is filed and served becomes evidence in the proceeding unless the Court has ruled (it) inadmissible."

We consider that the special investigation report was both relevant and admissible as providing the contextual setting in which the Respondent provided his written response to the various allegations made against him. To that limited extent and for that sole purpose the special investigation report should have been admitted by the trial judge.

Having said that however, we are also firmly of the view that the truth of the contents of the special investigation report and its annexures constituted inadmissible hearsay incapable of being testified to and/or identified and/or produced by George Pakoasongi.

In the result and in the absence of any relevant and admissible evidence which might have justified the Respondent's dismissal for serious misconduct, the trial judge, in our view, could reach no other conclusion than that the dismissal of the Respondent was unjustified and accordingly the Respondent was entitled to the relief sought.

The appeal against the Supreme Court's finding that the Respondent's dismissal was unjustified must therefore fail and is accordingly dismissed. There being no appeal against the trial judge's monetary assessment and awards, they are formally upheld and confirmed.

Although the above is sufficient to dispose of the appeal, in deference to the State's submissions at the appeal hearing we provide brief remarks on the meaning, effect and relationship between section 29 of the Public Service Act No. 11 of 1998 and section 50 of the Employment Act [Cap.160] as follows:

• Section 29 (1) of the Public Service Act No. 11 of 1998 whilst empowering the PSC to " dismiss an employee at any time for serious misconduct or inability" does not, in our view, preclude the application of the protective provisions of section 50 of the Employment Act [Cap. 160] to the exercise of the power;
  
• The protective provisions of section 50 of the Employment Act [Cap. 160] namely:
  

"(2) None of the following acts shall be deemed to constitute misconduct by an employee -

(a) trade union membership or participation in trade union activities outside working hours, or with the employer's consent, during the working hours;

(b) seeking office as, or acting in the capacity of, an employee's representative;

(c) the making in good faith of a complaint or taking part in any proceedings against an employer.

(3) Dismissal for serious misconduct may take place only in cases where the employer cannot in good faith be expected to take any other course.

(4) No employer shall dismiss an employee on the ground of serious misconduct unless he had given the employee an adequate opportunity to answer any charges made against him and any dismissal in contravention of this subsection shall be deemed to be an unjustified dismissal.

(5) An employer shall be deemed to have waived his rights to dismiss an employee for serious misconduct if such action has not been taken within a reasonable time after he has become aware of the serious misconduct."

are entirely consistent with the PSC's obligation in section 29, "to act as a good employer";

• The burden of establishing "serious misconduct" under section 29 of the Public Service Act and section 50 (1) of the Employment Act rests fairly and squarely on the employer to establish on a balance of probabilities. The Appellants' defence to the claim failed in this case because no admissible evidence was led by the employer to prove that its employee had been guilty of " serious misconduct";
  
• We affirm the decision of this Court in Ben Garae v PSC [2005] VUCA 20; Civil Appeal Case no. 03 of 2005:
  

" ... that section 50 (4) does not, in terms, require an oral hearing to be given to an employee before a dismissal for serious misconduct."

• Furthermore what process or procedure will satisfy the statutory requirement in section 50 (4) of "an adequate opportunity to answer any charges made against (an employee)" will depend on all the circumstances of the particular case and no generalizations can be or ought to be made or laid down; and
  
• Given the Respondent's prior employment record of 15 years of unblemished and dedicated service to the Appellant and given the discretionary nature of the power under section 29 (1) and the clear ameliorating provisions of section 29(2) of the Public Service Act, it is unlikely in our view, that the PSC complied with the requirements of section 50 (3) of the Employment Act, in considering a less draconian course than outright dismissal without benefits.
  

The formal orders of the Court are:

(1) Appeal dismissed;

(2) The Appellant pay the Respondent's costs.

Dated at PORT VILA on 01 June 2006
BY THE COURT

Hon. J. Von Doussa J.
Hon. D. Fatiaki J.
Hon. Hamlison Bulu J.
Hon. Oliver A. Saksak J.