Papua New Guinea Banking Corporation (PNGBC) v Jeff Tole (2002) SC694

• Jurisdiction: Papua New Guinea
• Judge: Amet CJ, Sheehan J, Kandakasi J
• Judgment Date: 27 September 2002
• Citation: (2002) SC694
• Docket Number: SCA No 28 of 2001
• Judgement Number: SC694

Full Title: SCA No 28 of 2001; Papua New Guinea Banking Corporation (PNGBC) v Jeff Tole (2002) SC694

Supreme Court: Amet CJ, Sheehan J, Kandakasi J

Judgment Delivered: 27 September 2002

N694

PAPUA NEW GUINEA

[In the Supreme Court of Justice]

SCA No. 28 of 2001

Between:

PAPUA NEW GUINEA BANKING CORPORATION

(PNGBC)

Appellant

And:

JEFF TOLE

Respondent

Waigani : Amet CJ, Sheehan & Kandakasi JJ

2002 : 25 February

27 September

Appeal – Practice & Procedure – Allowing judgement to go in default – Taking issue on pleadings not raised before the National Court – Judgement for matters not pleaded with particulars – Appellant not at liberty to hack back at the lack of pleadings.

Practice & Procedure – Loss of salary or wages and other benefits amount to special damages and they ought to be pleaded with particulars – Failure to request for further and better particulars and take issue on pleadings entitles a judge to make awards on evidence presented despite lack of foundation in pleadings.

Contract – Written contract of employment – Variation of not in accordance with terms of the contract – Termination in accordance with provisions of contract before agreed date of termination – No breach of contract and therefore no basis to award damages for breach of contract.

Damages – Damages for breach of employment contract – Purported variation to terms of contract not effect in accordance with contract – Termination in accordance with contract – Dismissed employer under obligation to mitigate loss – Evidence of part-time employment – No evidence of level of income – No loss or damages suffered.

Papua New Guinean Cases Cited:

Nahau Rooney v. Forest Industries Council [1990] PNGLR 407.

Motor Vehicles Insurance (PNG) Trust v. John Etape [1995] PNGLR 214.

Motor Vehicles Insurance (PNG) Trust v. James Pupune [1993] PNGLR 370.

Repas Waima v. Motor Vehicles Insurance Trust [1992] PNGLR 254.

Carmelita Mary Collins v. Motor Vehicles (PNG) Insurance Trust [1990] PNGLR 580.

Uma More v. University of Papua New Guinea [1985] PNGLR 401.

Mussau Timber Development Pty Ltd v. Santee Mangis & Ors N920.

Coecon Limited (Receiver/Manager Appointed) v. The National Fisheries Authority of Papua New Guinea (28/02/02) N2182.

Andrew Kwimberi of Paulus M Dowa Lawyers v. The State (27/03/98) SC545.

Yap v. Tan [1987] PNGLR 227.

Soso Tumu & Ors v. The State & Ors (28/02/02) N2190.

Peter Agilo v. Sir Mekere Morauta & Ors (28/02/02) N2102.

Other Cases Cited:

Ilkiw v. Samuel [1963] 2 All ER 879.

Pilato v. Metropolitan Water Sewerage and Drainage Board (1959) 76 WN (NSW) 364.

London Passenger Transport Board v Moscrop [1942] 1 All ER 9.

Gould and Birbeck and Bacon (1916) 22 CLR 490.

Hadkinson v. Hadkinson (1952) 2 ALL ER 567.

Counsels:

Ms. M. Solomon, for the Appellant.

Mr. T. Boboro, for the Respondent.

27 September 2002

AMET CJ : The Appellant Papua New Guinea Banking Corporation (PNGBC) appeals against a decision of the National Court awarding the Respondent a sum of K160, 834.66 as damages for wrongful dismissal.

The Respondent was employed under a written contract with the Appellant Bank as the Executive Manager, Lending Services for a period of three years commencing on 1 June 1998. On 11th October 1999 his contract of employment was terminated. In proceedings he instituted in the National Court, on 3 December 1999, the Court declared that the decision of the Appellant to terminate the contract of employment was null and void.

At the time of the termination of the contract on 11 October 1999, the Appellant paid the Respondent the sum of K144,953.43 as his entitlements pursuant to Clause 28 (b) of the Contract of Employment. This amount represented the Respondent’s entitlements for the period of twelve months. At the time of his termination, the Respondent had one year and eight months remaining under his contract of employment.

The Respondent then commenced proceedings in the National Court for damages for unlawful termination, for the remaining eight months under the Contract of Employment.

The Court upheld this claim as being correct in law, applying the ruling in Rooney v. Forest Industries Council of Papua New Guinea and Another [1990] PNGLR 407 and concluded that since he was unlawfully dismissed, the Respondent is entitled to salaries and other entitlements or benefits for the balance of his contract.

The Appellant contends that the learned trial judge erred in fact and law in ruling that the Respondent was entitled to judgment in his favour for the sum of K160,834.66, as special damages for wrongful dismissal from his contract of employment, because it had already paid the Respondent his contractual entitlements in the sum of K144, 953.45 upon his termination.

The Appellant further contends that the Respondent’s claim was only limited to general damages for distress and suffering, but concedes that the special damages award of K15,000.00 for distress and suffering can be affirmed. It says further that the award of K9,377.84 for interest on the principal sum be set aside but interest at 8 percent may be calculated from the date of filing of the writ on the sum of K15,000.00 special damages.

Clause 28 (b) of the Contract of Employment provides for termination of the contract by the bank in the following terms:

“In the event that the bank terminates this agreement for reasons other than unsatisfactory performance and/or cause then and in that event the officer will be entitled and the Bank shall pay to the officer, the salary and all other benefits pursuant to this Agreement, however described for the unexpired duration of this agreement or a maximum of twelve months whichever is lesser”.

Whatever the precise reasons for the termination of employment of the Respondent by the Appellant does not matter because the National Court had declared that the termination was unlawful.

In my opinion, the termination clearly fell within the provisions of Clause 28 (b), that is that the termination was for reasons other than unsatisfactory performance and/or cause. The Bank was then obliged to pay the salary and all other benefits for the unexpired duration of the agreement or a maximum of twelve months whichever is the lesser.

The Appellant knowingly and correctly calculated the Respondent’s entitlements in the sum of K144,953.43, which it paid into the Respondent’s account on the date of the termination, 11 October 1999.

I consider that the case relied upon by the learned trial judge as stating the law on the subject, Rooney v Forest Industries Council of Papua New Guinea (supra) is to be distinguished from the facts of this case. In this case, the contract of employment specifically provides for termination for reasons other than unsatisfactory performance and/ or cause. The termination having been found by the Court to be unlawful and thus inferentially not being for unsatisfactory performance and/or a good cause, then the entitlements of the Respondent were to be in accordance with Clause 28(b).

That being the full entitlements for such a termination, in my opinion the Respondent was not entitled to the balance of the period of the contract remaining and I consider therefore that the learned trial judge erred in extending the proposition enunciated in Rooney v Forest Industries Council (supra).

The Appellant has conceded that the claim for special damages for distress and suffering could be affirmed, the only head of damages the respondent could legitimately claim plus interest.

In these circumstances therefore, I am content to uphold the appeal on this ground alone without needing to determine the other grounds of appeal.

I would therefore uphold the appeal with costs.

SHEEHAN J: I have read the judgment of the Chief...