Wolfgang Bandisch v National Capital District Botanical Enterprises Ltd (2009) N3806

• Jurisdiction: Papua New Guinea
• Judge: Davani J
• Judgment Date: 29 September 2009
• Docket Number: WS NO. 2005 OF 2005 (NO.1)
• Court: National Court
• Judgement Number: N3806

Full Title: WS NO. 2005 OF 2005 (NO.1); Wolfgang Bandisch v National Capital District Botanical Enterprises Ltd (2009) N3806

National Court: Davani J

Judgment Delivered: 29 September 2009

N3806

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

WS NO. 2005 OF 2005

(NO.1)

BETWEEN:

WOLFGANG BANDISCH

Plaintiff

AND:

NATIONAL CAPITAL DISTRICT BOTANICAL ENTERPRISES LTD

Defendant

Waigani: Davani .J

2009: 14th, 29th September

CONTRACT – Employment of non-citizen on a contract – written contract for a term of 1 year – plaintiff continued to work for 5 years – contract is implied.

CONTRACT – Employment of non-citizen – plaintiff did not have a work permit – an offence to employ a non-citizen without a work permit - employer and employee must apply for a work permit before employee commences employment – ss.3, 6(1), 18 of Employment of Non-Citizen Act 2007

CONTRACT – Plaintiff continued to work without a contract – contract is implied – discussion of the principles of the ‘officious bystander test’ and ‘business efficacy test’.

CONTRACT – dispute as to terms of an implied contract – Employment Act applies – s.15 of Employment Act.

Facts

The plaintiff is a German National. He was employed on a written contract of employment as the defendant’s General Manager for a 1 year term. He was employed without a valid work permit, which employment continued beyond the 1 year term, for another 5 years. He continued to receive the same entitlements as those stipulated under the written contract. After 5 years, he was terminated for alleged mismanagement and misappropriation. He sued the defendant for breach of contract.

Issues

1. Whether the written contract of employment between the plaintiff and the defendant which was executed on 26th February, 2001, continued to apply after its expiration on 1st November, 2001 up to 29th July, 2005 when the plaintiff was formally terminated by the defendant?

2. If so, whether the plaintiff is entitled to entitlements stated in the written contract of employment of 2001, which entitlements would have accrued from the period 1st November, 2001 to 29th July, 2005?

3. Who applies for a work permit, the employer or employee and when does that happen?

4. Because the plaintiff did not have a work permit for the duration of his employment with the defendant, is his contract valid or is it illegal and unenforceable?

Reasons

1. Yes, because the contract was implied in its terms.

2. The aspect of entitlements is adjourned for assessment.

3. Both the plaintiff and the defendant should have applied for the work permit which the plaintiff should have had in his possession before commencement of employment.

4. The defendant’s action in allowing the plaintiff to work for nearly 5 years without a work permit meant it conceded and acquiesced in its conduct. Therefore, the contract is neither illegal nor is it unenforceable.

Case Cited:

Papua New Guinea Cases

· Ume More, Fabian Pok, Levi Tilto, Wandi Oscar Yamuna Paul Piru, Powes Parkop and Members of the Students Representative Council and all those students now enrolled at the University of Papua New Guinea who have National Scholarships other than Medical Students v. The University of Papua New Guinea [1985] PNGLR 401

· Dolphin Enterprises Pty Limited v. Saun [1990] PNGLR 77, (N803)

· Putput Logging Pty Ltd v. Ambalis [1992] PNGLR 159

· Kora Gene v. MVIT [1995] PNGLR 344 (N1224)

· Steven Charles Pickthall v. Lae Plumbing Pty Ltd

· Papua New Guinea Banking Corporation v. Jeff Tole

· Air Niugini and National Airlines Commission v. Dennis Salter (2001) SC459

· Madiu Andrew v. Mineral Resources Development Company Ltd, Koiari Tarata, Chairman – Board of Directors and Sir Mekere Morauta, Kt, MP, Prime Minister (2004) N2601

· Mathew Piake Kaen v. Telikom PNG Ltd (2004) SC746

· Damansara Forest Products (PNG) Ltd (In Liquidation) v. RH Trading (2004) N2723

· Kila Tutura v. Joseph Ng and Econ Investment Ltd (2005) N2924

Overseas Cases:

· Luxor (Eastbourne) Ltd v. Cooper [1941] AC 108

· Shirlaw v. Southern Foundries (1926) Ltd [1939] 2 KB 206

· The Manifest Lipkowy [1989] 2 Lloyd’s Rep. 138

Texts:

· Sir Guienter Trietel’s ‘The Law of Contract’ 11th Edition (2003)

Counsel

D. Doiwa, for the plaintiff

B. Bakau, for the defendant

29th September, 2009

DECISION ON LIABILITY

(NO. 1)

1. DAVANI .J – The plaintiff’s claim is in relation to an alleged breach by the defendant of his employment contract with the defendant or alternatively, damages for distress, frustration and general disappointment plus interest and costs. The trial is on both liability and quantum

2. The defendant opposes the application submitting that although the plaintiff was retained as its General Manager for another five (5) years after the expiration of his original contract of employment on 1st November, 2001, that he was terminated on 29th July, 2005 because he had mismanaged and misappropriated the defendant’s funds.

3. The defendant submits further that after the plaintiff’s termination on 29th July, 2005, that the defendant did not renew his contract.

Background

4. The plaintiff relies on his Amended Statement of Claim filed on 10th December, 2007 which was originally filed by Writ of Summons on 19th December, 2005.

5. The defendant relies on its Verified Defence filed on 22nd November, 2005 wherein it pleads that the plaintiff’s employment with the defendant was terminated because that plaintiff had mismanaged its funds and that therefore, his termination was proper.

Evidence

6. In support of their cases, the following affidavits were filed and relied on;

(i) affidavit of Augustine Ravi sworn on 7th April, 2009 and filed on 8th April, 2009 by lawyers for the National Capital District Commission for and on behalf of the defendant;

(ii) affidavit of the plaintiff sworn and filed on 18th February, 2009 by Pacific Legal Group Lawyers.

Analysis of evidence and the law

7. The plaintiff was engaged as the defendant’s General Manager on a one-year contract of employment commencing on 1st November, 2000 and ending on 1st November, 2001. This contract of employment was executed on 26th February, 2001 (‘first contract’).

8. Under the first contract, the plaintiff was entitled to the following;

(i) Salary – AUD$96,000.00 per annum;

(ii) Housing – rental accommodation at K700.00 per week/K10,400.00 per annum;

(iii) Vehicle – provided for by the defendant company;

(iv) Leave – 4 weeks per annum;

(v) Leave fare – economic class return after 11 months of service per annum.

9. The contract was also subject to the plaintiff having a valid work permit.

10. After the expiration of the first contract, the defendant retained the plaintiff’s services as its General Manager for another five (5) years until his employment with the defendant was terminated on 29th July, 2005 (‘second contract’). The termination was because of alleged mismanagement and misappropriation of the defendant company’s funds by the plaintiff.

11. By Writ of Summons filed on 19th October, 2005, the plaintiff claimed the following unpaid entitlements for the period 2001 to the period ending 29th July, 2005;

(i) Outstanding recreation leave K72,294.94
entitlements and airfares

(ii) Pro-rata long service payment for 5 K23,981.94
years

(iii) Pro-rata leave pay from May 6 to K2,455.14
July 29,2005

(iv) Payment in lieu of notice K34,263.87

(v) Final pay from July 21 to July 29, K3,689.96
2005

(vi) Repatriation fares (airfares and K11,593.50
cargo)

(vii) Extraordinary airfares incurred in K105,699.00
relation to temporary resident permit

Total: K253,798.37

12. The plaintiff claims that the defendant did not arrange a work visa for him, so he was therefore forced to operate under a business visa, which meant that he had to leave PNG on numerous occasions before the expiration of the business visa, then apply for a business visa, which then allowed him to continue to work for the defendant company in accordance with his obligations under the contract. He claims that although he requested the defendant’s Board for a fresh contract of employment and that his requests were made on numerous occasions, that this was never done.

13. By his Amended Statement of Claim filed on 10th December, 2007, the plaintiff makes the following claims;

(i) Loss of salary from 21st July, 2005 K3,689.96
to 29th July, 2005

(ii) Loss of outstanding recreation leave K72,294.94
entitlements for 5 years

(iii) Loss of pro-rata leave pay from 6th K23,981.94
July to 29th July, 2005

(iv) Loss of payment in lieu of notice K34,263.89

(v) Loss of repatriation fare K11,593.50

14. The issues now posed before the Court are the following;

(i) Whether the written Contract of Employment between the plaintiff and the defendant which was executed on 26th February, 2001, continued to apply after the expiration of the contract on 1st November, 2001 up to 29th July, 2005 when the plaintiff was formally terminated by the defendant?

(ii) If so, whether the plaintiff is entitled to entitlements stated in the Contract of Employment of 2001, which entitlements would have accrued from the period 1st November, 2001 to 29th July, 2005;

15. The other aspects of the plaintiff’s submissions which will be dealt with by this Court is in relation to the plaintiff’s work permit. I will also discuss whose...