Bennie Daniel v Walter Kapty (Acting Managing Director National Housing Corporation) and National Housing Corporation (2011) N4361

• Jurisdiction: Papua New Guinea
• Judge: Gavara Nanu J
• Judgment Date: 26 July 2011
• Court: National Court
• Docket Number: OS No 915 OF 2005 (JR)
• Citation: (2011) N4361
• Year: 2011
• Judgement Number: N4361

Full Title: OS No 915 OF 2005 (JR); Bennie Daniel v Walter Kapty (Acting Managing Director National Housing Corporation) and National Housing Corporation (2011) N4361

National Court: Gavara Nanu J

Judgment Delivered: 26 July 2011

N4361

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

OS No 915 OF 2005 (JR)

BETWEEN:

BENNIE DANIEL

Plaintiff

AND:

WALTER KAPTY (Acting Managing Director National Housing Corporation)

First Defendant

AND:

NATIONAL HOUSING CORPORATION

Second Defendant

Waigani: Gavara Nanu J

2010: 7th July

2011: 26th July

ADMINISTRATIVE LAW – Termination of employment- Employer acting ultra vires – Reinstatement against good administration – Entitlements which were due to the plaintiff as at the first scheduled trial date which was vacated by consent of the parties to be paid to the plaintiff.

Cases cited

Ron Napitalai for and on behalf of the Board of Appeal Committee of PNG Ports Corporation Limited and Another –v- Casper Wallace (2010) SC1016

Counsels:

R. Uware, for the plaintiff.

V. Lovare, for the defendants

26 July, 2011

1. GAVARA-NANU J: The plaintiff seeks orders to quash the decisions by the defendants to suspend him from his employment with the second defendant as the Internal Auditor and Audit Team Leader on 5 May, 2005, without pay then to subsequently dismiss him from his employment on 12 July, 2005. The plaintiff also seeks orders to reinstate him to his substantive position and that all the entitlements due to him since his dismissal to be paid to him.

Background

3. The background facts appear in the affidavit sworn by the plaintiff on 27 September, 2005, these facts are not in dispute. From these facts, it is noted that the plaintiff was employed by the second defendant (the “NHC”) on a contract as the Audit Team Leader, in-charge of the Audit Section in the NHC. The plaintiff was suspended in the afternoon of 5 May, 2005, over allegation that he committed serious disciplinary offences which were criminal in nature. The suspension was effected by the first defendant by a notice in which the first defendant informed the plaintiff that he was suspended from duty without pay in anticipation of charges to be laid against him. On 3 May, 2005, the National newspaper ran an article on allegations of bribery and corruption in the NHC. The next day on 4 May, 2005, the plaintiff received a memo from the first defendant asking him if he was responsible for the release of confidential information regarding bribery and corruption in the NHC to the media. On the morning of 5 May, 2005, the plaintiff denied any knowledge about the release of any confidential information on the NHC. In the afternoon of 5 May, 2005, the plaintiff was suspended without pay. The Notice of Suspension was prepared and issued by the first defendant.

4. On 19 May, 2005, the plaintiff was charged with 14 serious disciplinary offences under Clause 160 (1) (a) (b) (d) (h) (i) and (m) of NHC Determination No.1 of 1990 (“the Determination”). On or about 26 May, 2005, the plaintiff responded to the 14 charges denying all the charges. A disciplinary Committee was set up by the defendants to hear the charges against the plaintiff. On 12 July, 2005, the plaintiff was served with a notice of dismissal by the first defendant, the dismissal was in relation to 14 charges laid against him. In the notice of dismissal the first defendant told the plaintiff that he was dismissed because of his conviction for criminal offences relating to his official duties. The Notice of Dismissal read:

NHC

National Housing Corporation

NOTICE OF DISMISSAL UNDER CLAUSE 157, (1) OF THE NATIONAL HOUSING CORPORATION DETERMINATION NO. 1OF 1990 (AMENDED)

TO: MR. BENNIE DANIEL

C/- NATIONAL HOUSING CORPORATION

P.O. BOX 1550

BOROKO

NATIONAL CAPITAL DISTRICT

TAKE NOTICE that in accordance with clause 157, (1) of the NHC Determination No. 1 of 1990 (Amended), you having been convicted on the 5th day of May, 2005, of a criminal offence, which does relates to the duties of your office, you are hereby dismissed from the National Housing Corporation.

Dated this 12th day of July, 2005.

(Signed) 12/07/05

____________________ ____________________

WALTER KAPTY DATE

ACTING MANAGING DIRECTOR

DELIVERY OF DISMISSAL NOTICE

I hereby certify that I have served the above named officer with the notice indicated.

ROBERT SERT MANAGEMENT GUARD

_______________ _______________________

NAME DESIGATION

12/07/05 01:50PM

_______________ ________________________

DATE TIME

ACKNOWLEDGEMENT

I Mr. Bennie Daniel hereby confirm that I have been served the dismissal notice.

DATE: - 12/07/05 TIME: -- 01:50PM SIGN: (Signed)

5. The plaintiff was not told whether he was guilty of the 14 charges before he was dismissed. He was also not given an opportunity to be heard on the penalty before his dismissal from his employment.

6. The plaintiff appealed against his dismissal to the NHC Appeals Committee but the appeal was dismissed, the decision to dismiss the appeal was conveyed to the plaintiff in a letter dated 2 September, 2005, but no reasons were given by the Committee in that letter for dismissing the appeal. The letter read:-

NHC

National Housing Corporation

OFFICE OF THE MANAGING DIRECTOR

Phone: 325 7713/3255424 National Housing Corporation

Fax: 325 9918/325363 P.O. Box 1550

BOROKO, N.C.D.

Papua New Guinea

2nd September, 2005

TO: MR. BENNIE DANIEL

C/- NATIONAL HOUSING CORPORATION

P.O. BOX 1550

BOROKO

NATIONAL CAPITAL DISTRICT

Dear, Mr Bennie Daniel

SUJECT: APPEAL DECISION AGAINST TERMINATION

As per your appeal against the decision of termination, an Appeals Committee was appointed to look into your case.

Further to the Committee’s findings, the decision to terminate your services from National Housing Corporation is sustained.

As such, the Appeals Committee has upheld the decision of the Disciplinary Committees’ decision of dismissal.

For your information.

Thank you.

Yours faithfully,

National Housing Corporation

___(Signed)_________ BK:___(Signed)_____

WALTER KAPTY

Acting Managing Director

7. On 15 July, 2005, the plaintiff wrote to the Public Services Commission to investigate his dismissal but no action was taken by the Public Services Commission. The plaintiff was not convicted of a criminal offence which purportedly was the reason for his dismissal.

8. In suspending the plaintiff and eventually dismissing him, the defendant relied entirely on a report compiled by two officers of the NHC namely Mr. Martin Tau, who was Organizational Planning and Training Officer and Bernard Pogoram, who was Human Resources Specialist, the report was dated 28 October, 2004. The report was titled: Human Resource File Report; it made four recommendations, first; immediate suspension of the plaintiff without pay, second; an external auditor to be engaged to conduct investigation into the alleged fraud activities by the plaintiff, third; the officer (the plaintiff) be charged and terminated from service and fourth; the matter be referred to the police fraud squad for further actioning.

9. In their defence to this application, the defendants raised three issues; first is whether the plaintiff has a cause of action and whether the first defendant’s actions in suspending and dismissing the plaintiff from his employment can be reviewed, second; if the first defendant’s actions could be reviewed, whether an order in the nature of certiorari can be granted and third; whether the plaintiff should be reinstated to his position.

10. In relation to the first issue, defendants argued that actions of the first defendant in suspending and dismissing the plaintiff from his employment cannot be reviewed because the NHC being a corporation its actions are not amenable to judicial review, thus there is no cause of action. They argued that NHC is not a public body created and regulated by public law, they relied on ss. 5 and 6 of the NHC Act 1990, which provide that NHC is a corporation.

11. The defendants submitted that NHC is no longer a mere Housing Commission, it is now a corporate body and is a private entity whose actions cannot be reviewed. It was argued that plaintiff’s remedy is in damages for wrongful termination. The defendants rely on Ron Napitalai for and on behalf of the Board of Appeal Committee of PNG Ports Corporation Limited and Another –v- Casper Wallace, (8th February, 2010). In that case, the Supreme Court held that the PNG Port Corporation is not a public body therefore its actions cannot be reviewed.

12. In regard to the second issue raised by the defendants, I am of the firm opinion that the plaintiff has a cause of action and the actions of the first defendant can be reviewed because the NHC is a public body established as a government instrumentality, it is not a company incorporated under the Company’s Act in that regard, the case of Ron Napitalai is distinguishable from this case. For the...