Fifteen years after he commenced what would become an arduous legal battle against the New Building Society (NBS) for severance and other benefits, former sacked manager Maurice Arjoon yesterday edged closer towards closure.
The Court of Appeal in a unanimous decision yesterday afternoon affirmed a High Court ruling made five years ago that Arjoon’s dismissal was wrongful, though it reduced the award to him for pension from $59,033,281 to $18,817,432.
In delivering the judgment of the Court, acting Chancellor Yonette Cummings-Edwards said that trial Judge Brassington Reynolds was right to have awarded pension along with severance and benefits.
She said, however, that in accordance with the Termination of Employment and Severance Pay Act (TESPA) the appellate court found that it is only $18,817,432 to which Arjoon is entitled—from the date of his employment on December 1st, 1979 to his dismissal on August 13th, 2007.
On this point the Chancellor referenced the evidence that Arjoon had contributed over $6 million while the NBS had contributed over $12 million, which brought it to a total of $18,817,432.
“In our view, Arjoon is entitled to receive those contributions “subject to any indebtedness” to the NBS…,” she said, while adding that with his employment having ceas-ed, no further pension contribution or pension rights were in place.
Justice Reynolds had awarded full pension up to the date of dismissal and to when Arjoon would have retired.
The Court has also awarded costs to Arjoon in the sum of $800,000, which has to be borne by the NBS.
On the request from counsel for the NBS, Pauline Chase, the Court granted a three-month stay of its ruling as she indicated that it now has to be discussed with her client to ascertain whether it wishes to file any further appeal to the final appellate court for Guyana—the Caribbean Court of Justice (CCJ).
NBS’ challenge before the Guyana Court of Appeal had been that the award by Justice of Appeal, Rishi Persaud of $59,033,281 to Arjoon for pension was erroneous.
This sum was part of the more than $79 million, which had been earlier awarded to Arjoon by Justice Reynolds, who found that Arjoon was entitled to be compensated accordingly for severance benefits, pension and loss of earnings.
The position of the mortgage-lending institution was that pension could not be awarded together with severance and other benefits when an employee is terminated or dismissed.
Referencing Section 21 (4)(d) of TESPA, the Chancellor said that the Appellant’s appeal would be allowed, only to the extent that Arjoon is entitled to pension up to the date he was dismissed.
Wrongfully dismissed
Meanwhile, throwing out the appeal in full to Arjoon’s dismissal, the appellate court upheld Justice Reynolds’ decision that the NBS had wrongfully dismissed the former manager and particularly underscored as the lower court had done that there was no evidence of wrong-doing on his part.
Referencing the TESPA and citing a number of case law authorities, the appellate court affirmed the High Court decision that the NBS did not meet the threshold for summarily dismissing Arjoon.
Further, the Chancellor said that the Appellant failed, as required by TESPA, to show that Arjoon by himself was directly responsible for the questionable withdrawal which led to his dismissal.
She said that what was in fact established by the NBS was that there was a line of authority, and that there was a series of checks and balances prior to the transaction making its way to Arjoon for his signature.
On this point she said that as the trial Judge “rightly found, there is no place for Peter to pay for Paul or Paul to pay for all.” Chancellor Cummings-Edwards went on to stress that “it is not a case of ultimate responsibility but individual responsibility.”
“Thus, making a person a scapegoat for reasons of expediency,” would not meet the narrow confines of what is required by the TESPA, she further went on to assert. Like the trial judge, the appellate court found that all the various verification procedures of the NBS had been adhered to by Arjoon throughout the process.
The Chancellor said, too, that while the evidence shows that the Bank had repaid the amount withdrawn from the account in question, the NBS never, as is required by the Act, showed the effect of the loss on the Bank.
Background
It has always been the contention of Senior Counsel Edward Luckhoo, who represented Arjoon, that his client had been wrongfully dismissed and was therefore entitled to the full award of almost $80 million in damages.
Following Justice Persaud’s ruling in December of 2017 that Arjoon be paid the $59,033,281 for pension, it was only after the successful execution of a levy a month later that the mortgage lending institution wrote Arjoon a cheque for that payment in full.
A computation from estimates submitted by attorneys on both sides had pegged the total award of damages at $79,282,801 which Justice Reynolds granted on July 20th of 2017.
Justice Persaud had, however, stayed the remaining $20,249,801 which was awarded to the sacked manager for severance.
Among the grounds on which it appealed the High Court’s ruling, the Society termed Justice Reynolds’ decision erroneous, arguing that pension could not be awarded together with severance and other benefits, when an employee is terminated or dismissed.
In its challenge to the Full Bench of the Court of Appeal—comprising the Chancellor, Justice Persaud and Justice Franklyn Holder—NBS through Chase argued, among other things, that the $59,033,281 was not due to Arjoon for pension, even on the premise that he was entitled to it for his service to the bank.
Luckhoo had argued that the central issue in the case was whether his client complied with the bank’s regulations for effecting the withdrawal in question, given that the holder of the account in question from which certain withdrawals were made, was overseas at the time.
He argued that in answer to the question of whether the transaction amounted to misconduct on Arjoon’s part, there is no evidence from the Society to so substantiate, though that has been its contention.
Luckhoo said that in fact, the evidence before the court from the bank’s own auditor and other employees who testified at the trial, has been that the former manager complied with every regulation he ought to have followed as well as his subordinates.
The lawyer had said, too, that the power-of-attorney of the account holder—Bibi Khan—by which the withdrawal was authorized, was found to have been valid as reflected by the records of the Deeds Registry, as the Court also found.
He said that though Khan had visited the bank and merely said that she did not authorize that withdrawals, there has been no evidence before the court that it was not her who had authorized the withdrawals.
Luckhoo held to his position that in the absence of any evidence of misconduct, the dismissal of his client remained unjustified as had been found by Justice Reynolds.
“The transaction was legitimate and all the procedures were followed,” he asserted.
In its challenge to the High Court ruling, NBS had argued among other things, that on the basis of the trial judge’s conclusion that Arjoon was “wrongfully dismissed,” he was not entitled to severance pay by virtue of his status and contracts and according to the Termination of Employment and Severance Pay Act.
It said too, that pension, which the court also awarded, could not be granted in conjunction with severance or any other benefit related to termination or dismissal, and that the judge did not give due attention to the relevant parts affecting Arjoon’s conduct in the NBS rules, the systems manual, the pension rules and the contract signed by him.
Additionally, the NBS had advanced that the overriding defaults in the respondent’s dealing with the withdrawals from the account of Khan were not taken into account by the judge nor did he consider that the person making the withdrawals from the account was not duly and properly authorized to do so, thereby causing NBS a loss of over $79 million.
In his judgment, Justice Reynolds had said that the Court found no evidence to substantiate NBS’ claims that Arjoon committed gross or serious misconduct, warranting his dismissal. The judge had said that it showed no established rules, standards or procedures which Arjoon was guilty of breaching.
On June 12th, 2007, Arjoon and two other managers, Kent Vincent, Operations Manager, and Kissoon Baldeo, Assistant Mortgage Manager, had their services terminated after millions were discovered missing from the account of Bibi Khan.
Arjoon was interdicted from duty before being dismissed. The trio, along with several other employees of the bank, were charged in the matter but they were later freed after Khan repeatedly failed to attend court hearings.
After the charge against him was thrown out, Arjoon subsequently filed the lawsuit against the Society, for wrongful dismissal.
Late Ombudsman Justice Winston Moore had concluded that the three managers suffered a “grave injustice” as he found that there was insufficient evidence to suggest that the trio was guilty, let alone to successfully prosecute them.
