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Padua v Public Service Commission [1997] FJHC 54; HBJ0009D.1996S (6 May 1997)

IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION

JUDICIAL REVIEW NO. HBJ0009 OF 1996

IN THE MATTER
of an application by Mario Nagales Padua for a judicial review of a decision of the Public Service Commission made on 6th March 1996

Between:

MARIO NAGALES PADUA
of Labasa Medical Practitioner
Applicant

And:

PUBLIC SERVICE COMMISSION
Respondent

Counsel: Mr. Kapadia and Mr. Ram for Applicant
Mr. Singh for Respondent

Hearing: 14th November 1996
Decision: 6th May 1997

DECISION OF PAIN J.

This is an application made pursuant to Order 53 rule 3 of the High Court Rules for leave to apply for judicial review.

By an undated agreement made with "The Secretary, Public Service Commission for and on behalf of the Government of the Republic of Fiji", the Applicant was employed as a "medical officer in the Ministry of Health" for a period of three years from 22nd March 1994. A copy of the Agreement (hereinafter called "the Agreement of Service") is annexure A to the affidavit of the Applicant dated 28th May 1996.

The Applicant was employed at Labasa Hospital as Chief Medical Officer in charge of the General Outpatients Department.

On 20th March 1996 the Medical Superintendent of Labasa Hospital handed to the Applicant a letter dated 13th March 1996 from the Public Service Commission and signed by the Secretary for the Public Service. This letter advised the Applicant that the Commission at a meeting on 6th March 1996 had decided that his "appointment in the service be terminated forthwith"

The Applicant seeks leave to apply for judicial review of this decision of the Respondent made on the 6th March 1996. This is opposed by the Respondent and an affidavit from Meli Bainimarama, Secretary for the Public Service Commission has been filed in reply.

Counsel for the Applicant submits that a sufficient case has been made out for leave to be granted. In determining whether to exercise its powers under the Agreement of Service, the Respondent, being a public authority, was under a duty to act fairly and in the public good. It is submitted that the Respondent failed to do this. It arbitrarily dismissed the applicant without any proper inquiry, without giving the Applicant the chance to be heard on adverse matters relating to his performance, without following the provisions of the Public Service Commission (Constitution) Regulations 1990 and without regard to the Applicant's legitimate expectations. Counsel primarily relied upon the Court of Appeal decision of Korovulavula v. Public Service Commission (Civil Appeal No. 6 of 1994), several decisions of this Court and R v British Broadcasting Corp., ex parte Lavelle [1983] 1 All E R 241.

Counsel for the Respondent submitted that leave should not be granted as the Applicant has no case at all for judicial review. The Agreement of Service which the Respondent, as a public body, made with the Applicant does not give rise to public law issues. The Respondent was entitled to terminate the Applicant's employment in accordance with the strict terms of the Agreement of Service. This is a private law issue. Counsel distinguished the case of Korovulavula v. Public Service Commission (supra) and relied on R v East Berkshire Health Authority, ex parte Walsh [1984] EWCA Civ 6; [1985] Q.B. 152 for a submission that the termination of the Applicant's employment was purely a matter of contract and the remedy for any alleged breach is in private law and not judicial review.

There is no doubt that the Applicant has a sufficient interest in the subject matter of the application as required by Order 53 Rule 3(5) of the High Court Rules. Likewise there is no dispute that the Respondent is a body whose source of power is derived from statute.

The issues in this case are whether the Decision of the Respondent to terminate the Applicant's employment is amenable to judicial review and, if so, whether the Applicant "has shown prima facie an arguable case on the merits" (The National Farmers' Union v Sugar Industry Tribunal & ors - Fiji Court of Appeal No. 8 of 1990).

The Agreement of Service was entered into by the Respondent "for and on behalf of the Government of the Republic of Fiji". Express provision for this is contained in the Constitution. The Respondent has power to make appointments to public office and to remove and exercise disciplinary control over such appointees (Section 127(1)). A public office is "an office of emolument in the public service" (Section 149(1)). The power to remove a person from public office includes "any power or right to terminate a contract on which a person is employed" (Section 154(1)). The Commission is also given the power to make regulations to facilitate the performance of its functions (Section 157(1)). The Public Service Commission (Constitution) Regulation 1990 (hereinafter called "The P.S.C. Regulations") provide that appointment can be by engagement of a person on contract terms of service (Regulation 2) and that the appointment of an officer may be terminated in accordance with the terms of the contract (Regulation 27(c)).

The Agreement of Service in this case provided that the Government could terminate the agreement by giving 3 months notice in writing or by giving one month's salary in lieu of notice (Paragraph 8) and it could summarily dismiss the Applicant if, after reasonable inquiries, the Commission was satisfied that he had been guilty of misconduct (Paragraph 10).

All these forgoing matters show that the Respondent, a public body acting on behalf of the Government, had power to enter into the contract of service with the Applicant. It also had power to terminate the contract or dismiss the Applicant from service in accordance with the terms of the contract. In doing so, it would be acting inter vires the empowering legislation.

It is submitted on behalf of the Respondent that this is exactly what was done in this case. The Respondent terminated the Applicant's employment by the letter to the Applicant dated 13th March 1996 which stated:

"TERMINATION OF APPOINTMENT

The Public Service Commission, after considering the complaints raised against you for unethical conduct and unsatisfactory performance has decided at its meeting of 06 March 1996 that your appointment in the service be terminated forthwith.

In accordance with Clause 8(b) of your Agreement of Service you will be paid one month salary in lieu of this notice and will also be required under Clause 10, to refund to Government, 1/3 of the cost of passage paid in respect of yourself, wife and your children in transporting you to Fiji for commencement of duties under this Agreement of Service.

The Permanent Secretary for Health and Social Welfare is also advised to take necessary action regarding your termination. "

It is submitted that this was both a termination of the Agreement of Service under paragraph 8 and a dismissal of the Applicant under paragraph 10 as the rights in paragraph 8 are expressed to be "without prejudice to the provision of paragraph 10". Moreover the provisions of the PSC Regulations relating to disciplinary proceedings and termination of employment do not apply because Regulation 27(c) specifically provides that "where the officer is on contract terms of service his appointment shall be terminated in accordance with the terms of his contract".

Accordingly this was a private contract of employment between the parties and any dispute over dismissal must be litigated as a matter of private law. It is a civil claim for breach of contract and not a matter for judicial review.

The case of R v East Berkshire Health Authority, ex parte Walsh (supra) is relied upon by the Respondent. This case concerned a senior nursing officer (Mr. Walsh) who was employed by the East Berkshire Health Authority under contract. Following an incident at the hospital, the District Nursing Officer (Miss Cooper) suspended him from duty. She then held a disciplinary hearing to consider allegations of misconduct and the findings and recommendations of an independent committee of inquiry set up by the Regional Health Authority. Several days later Miss Cooper sent Mr. Walsh a letter purporting to terminate his employment. After the determination of appropriate appeal procedures, Mr Walsh applied for judicial review on the ground that there was a departure from the rules of natural justice in the procedures that led up to his dismissal. The judge at first instance held that his rights were of a sufficiently public nature to entitle him to seek such a public law remedy. On appeal to the Court of Appeal it was held that, although the applicant's contract of employment was with a public authority, it was an ordinary master and servant contract of employment. It did not give rise to public law remedies because there were no special statutory restrictions which underpinned the employee's position. The fact of employment by a public authority per se or the interests of the public in the functioning of the health authority did not give rise to such remedies. The applicant had been engaged on proper conditions of service and the appropriate challenges to his dismissal were by private law remedies of a complaint to an industrial tribunal or civil proceedings for wrongful dismissal.

The following extracts from the judgments of the Lord Justices of Appeal explain the decision of the Court:

Sir John Donaldson MR said at page 164 (when considering the House of Lord's decision Malloch v Aberdeen Corporation [1971] 1 WLR 1578):

"As Lord Wilberforce said, at pp. 1595-1596, it is the existence of these statutory provisions which injects the element of public law necessary in this context to attract the remedies of administrative law. Employment by a public authority does not per se inject any element of public law. Nor does the fact that the employee is in a "higher grade" or is an "officer". This only makes it more likely that there will be special statutory restrictions upon dismissal, or other underpinning of his employment: see per Lord Reid in Malloch v Aberdeen Corporation, at p. 1582. It will be this underpinning and not the seniority which injects the element of public law. Still less can I find any warrant for equating public law with the interest of the public. If the public through Parliament gives effect to that interest by means of statutory provisions, that is quite different, but the interest of the public per se is not sufficient."

Lord Justice May said at page 171:

"In my opinion the ratio for Lord Reid's view that the appellant in Malloch's case had been entitled to a hearing was that a statutory provision to that effect was plainly to be implied into the principal statute regulating the relationship between education authorities and teachers. I do not think that Lord Reid's opinion was based upon any general proposition that just because the employer was a public body this necessarily involved some "public law" element in a contract of employment between it and one of its servants, however senior, and that consequently that public employer was bound to observe the principles of natural justice when dismissing the employee."

and at pages 172 and 173:

"Having regard to the detailed terms of the applicant's contract with the authority, I do not think that the considerations which determine whether he was validly dismissed do go beyond that contract. I respectfully see no reason why those considerations in the circumstances of the instant case require to be tested broadly on arguments of public policy. The fundamental issues are whether the authority had grounds to dismiss the applicant summarily and whether they did so in accordance with his detailed terms and conditions of service .......... I do not think there is any element of "public" or "administrative" law in this case rendering it susceptible to or suitable for proceedings for judicial review under R.S.C., Ord. 53"
Finally Lord Justice Purchas said at pages 181-182:

"At the end of the day I find myself returning to the basic question, did the remedies sought by the applicant arise solely out of a private right in contract between him and the authority or upon some breach of the public duty placed upon that authority which related to the exercise of the powers granted by statute to them to engage and dismiss him in the course of providing a national service to the public? In my judgment there is no arguable case which can be mounted upon the facts disclosed even if they are all assumed in favour of the applicant to the effect that the remedies sought by him stem from a breach which can be related to any right arising out of the public rights and duties enjoyed by, or imposed upon the health authority. The only remedies sought by the applicant arise solely out of his contract of employment with them as opposed to any public duty imposed upon the health authority."

This decision is still regarded as good authority in England and is regularly cited in decisions and text books (See, for instance Administrative Law (6th Edition) by Wade at page 685 and Judicial Review by Supperstone and Goudie (1992), passim, and in particular page 36 where reference is made to McClaren v Home Office [1990] ICR 824). It is generally accepted that contractual employment by a public authority does not, ipso facto, give rise to public law remedies for an employee dismissed in terms of the contract. They may arise, for instance, if there are statutory restrictions upon dismissal, some other statutory "underpinning" of the employment, a failure to incorporate conditions in the contract that are required by statute or a procedural requirement to refer the matter to some disciplinary or other body that has not been properly done.

In the present case the Applicant, a doctor, was employed under contract by a Public Authority to work in a public hospital. Such a contract is excluded from the protective provisions of the PSC Regulations relating to dismissal. These requirements for interdiction, disciplinary hearings etc apply only to permanent and temporary employees and not to an officer employed on contract (Regulation 27). The contract gives the Respondent certain rights for termination or dismissal. Regulation 27(c) empowers the Respondent to terminate the employment in accordance with those terms. No specific legislative provision has been cited by the Applicant as providing or implying a special statutory provision restricting or otherwise underpinning the Applicant's employment by the Respondent and giving him public law rights in relation to a dismissal made in accordance with the terms of the contract. Counsel for the Respondent, on the basis of these matters and on the authority of R v East Berkshire Health Authority, Ex parte Walsh (supra) has put forward an attractive argument that judicial review is not available in this case.

However counsel for the Applicant submits that the Agreement of Service is a contract with a statutory body exercising statutory functions. Although the contract gave the Respondent the right to terminate the employment this was a discretionary power. In exercising that discretion the Respondent, as a statutory body, had a duty to act fairly and in the public good. It failed to do this, particularly by not advising the applicant of the nature of the complaints against him, acting on unsubstantiated complaints and failing to give the Applicant the opportunity to be heard. Accordingly the Applicant is entitled to apply for judicial review.

The Applicant bases his case on the Court of Appeal decision given on 23rd August 1994 in Korovulavula v Public Service Commission (Civil Appeal No.6 of 1994). Counsel submits that this authority should be followed in preference to R v East Berkshire Health Authority, Ex parte Walsh (supra). In any event that latter decision is distinguishable because it was decided in a jurisdiction where alternative employment protection legislation existed and the principles to be applied on applications for judicial review have developed since the case was decided in 1984.

In Korovulavula v Public Service Commission (supra) the Appellant had held the positions in the Public Service of Principal Licensing Authority and Controller of Road Transport. Both positions were terminated. His application to the High Court for judicial review was refused. On appeal, the Court of Appeal found in favour of the Appellant. However, as it was too late to quash the terminations and reinstate the Appellant (six and a half years had passed), the Court made declarations that the dismissals were unlawful.

The Court of Appeal's decision in respect of the termination of the appellant's appointment as Principal Licensing Authority is not directly applicable to the present case. It was not a contractual appointment. The appointment to that public office was made by the Minister of Transport under a power given to him by statute and was terminated by the Minister under a power given by another statute. The Court of Appeal held that the Minister's exercise of his power to terminate this statutory public appointment was reviewable by the High Court.

However the Court of Appeal's decision on the termination of the Appellant's appointment as Controller of Road Transport is directly pertinent to the present case. That appointment was made by written contract. The essential features of that contract are identical to those of the Agreement of Service entered into by the Applicant in this case. It is recorded in the Court of Appeal decision that the contract was headed "Government of Fiji, Agreement of Service" and "was in formal terms between the Commission, for and on behalf of the Government of Fiji, and the Appellant". That is identical to the Agreement of Service in the present case. Paragraph 6 of that contract provided that without prejudice to the provisions of paragraph 8 (relating to dismissal) the Government could terminate the agreement by giving the officer not less than 3 months notice in writing or by giving the officer one months salary in lieu of that notice. That is the same as paragraph 8 of the Agreement of Service in the present case. Paragraph 8 of that contract provided that if, after reasonable inquiries, the Government was satisfied that the officer had been guilty of misconduct or a breach of any term of the agreement, the officer could be summarily dismissed by the Government. Again, those are exactly the same rights given to the Commission under paragraph 10 of the Agreement of Service in the present case.

In Korovulavula v Public Service Commission the Appellant's contract was terminated pursuant to clause 6(6) - payment of one month's salary in lieu of notice - and this was done strictly in accordance with the provisions of the contract. The Respondent in the present case purported to terminate the applicant's contract on the same ground which is contained in paragraph 8(b) of the Agreement of Service. The Respondent's letter of 13th March 1996 is headed "Termination of Appointment". It advises the applicant that the Respondent has decided that "his appointment in the service be terminated forthwith" and that "in accordance with Clause 8(b)" of the Agreement of Service he would be paid one month's salary in lieu of notice. Accordingly the termination of the Applicant's employment in the present case is on all fours with the termination in Korovulavula v Public Service Commission.

The Court of Appeal in Korovulavula's case accepted that there was no breach of contract and that the Commission had acted in accord with its terms. However the Court said that it was necessary to go further than the express words of the contract to determine whether what was done by the Commission was proper. The ratio of the Court of Appeal decision that is referable to the present case is succinctly expressed at page 21 of the decision in this way:

"It must be recognized that the Commission had a discretionary power to decide whether it would exercise the rights it had in terms of Clause 6 of the contract to terminate the appointment ....... the respondent, being a statutory body created for public purposes, to carry out public functions and to ensure the carrying out of public functions by the Public Service, was required to exercise its rights under the contract in good faith and in accord with the general purposes of the statute for the public good"

The Commission in Korovulavula's case had asserted that the decision to terminate the Appellant's appointment was proper, fair and reasonable in view of certain statements the Appellant had made to a newspaper and in view of his inability to accept and undertake directions from his Minister. However the Court of Appeal held that both these matters related to requirements of the Minister for the Appellant to do certain things that were unlawful. For that reason it could not be said that the Commission's decision to exercise its rights to terminate the Appellant's employment was "in accord with the general purposes of the statute for the public good". Therefore the appeal succeeded and the Appellant was entitled to relief.

The Court of Appeal decision in Korovulavula v Public Service Commission (supra) is binding on this Court. It has been followed and applied in subsequent decisions of this Court, particularly Palani v Fiji Electricity Authority (Lyons J. 17.5.96 Lautoka H.C. Civil Action No. 11 of 1993) to which counsel for the Applicant has referred.

Korovulavula's case was decided in respect of a contract of employment entered into by the Public Service Commission on behalf of the Government in exactly the same terms as the Agreement of Service in the present case. An argument based on the decision in R v East Berkshire Health Authority, Ex parte Walsh (supra) may not have been considered by the Court of Appeal and underpinning legislation giving rise to public law rights may not have been specifically identified. However the Court stated in clear and unequivocal terms that an employment contract of this nature places a duty on the Respondent to exercise its rights in good faith and in accordance with the general purposes of the statute for the public good. Moreover there is some force in the Applicant's submission that the decision in R v East Berkshire Health Authority, ex parte Walsh (supra) was substantially influenced by the protective employment legislation in England. This carried particular significance for May L J who said (pages 169-170) "I think that earlier decisions in this general field must now be read in the light of the employment protection legislation" and "I think that at the present time, in at least the great majority of cases involving disputes about the dismissal of an employee by his employer, the most appropriate forum for their resolution is an industrial tribunal". He further said (page 173) that the case being decided was "one which could and should long ago have been relatively cheaply determined by an experienced industrial tribunal". There is no such employment protection legislation in Fiji and that may be distinguishing factor.

In all the circumstances this Court should follow and apply the Court of Appeal decision in Korovulavula v Public Service Commission (supra) in deciding the present application for leave to commence judicial review. In terms of that decision, the Agreement of Service between the Applicant and the Respondent gives rise to public law rights in a limited way. It is not the actual decision to terminate the contract that can be reviewed. That is a contractual right fortified by Regulation 27(c) of the PSC Regulations. What may be reviewable is the Respondent's exercise of its discretion to invoke the provisions of the Agreement of Service that provide for termination. That would be reviewable if the Respondent, in deciding to exercise those rights, failed to act "in good faith in accord with the general purposes of the statute for the public good". The Applicant must raise a sufficiently arguable case in this regard for leave to be granted.

The affidavit of Meli Bainimarama, the Secretary for the Respondent Commission shows that the decision to exercise the rights under the Agreement for Service was primarily made on two reports supplied by the Medical Superintendent of Labasa Hospital. (Exhibits A and B to the affidavit). These reports concern the Applicant's performance of his duties as a medical officer at the hospital.

The first report dated 2nd March 1995 was prepared by the Medical Superintendent following an investigation carried out by him in response to an anonymous complaint about the Applicant. This report details the history of the Applicant's employment. He was recruited as a consultant physician and appointed as Medical Officer in Charge of the Medical Unit. However it became "obvious in a very short time" that the Applicant "lacked the medical knowledge whether theoretical or practical" expected of him. He was therefore transferred to the General Outpatient Department and, because he was contracted at a salary level of Chief Medical Officer, it was necessary to put him in charge of the Department. The report goes on to advise that a complaint was received by the Medical Superintendent from the Sister in charge of the General Outpatient Department on 5th July 1994. This expressed concern about the well being of patients in the Applicant's care and quoted some specific cases. The Medical Superintendent advised the staff of action to be taken in such circumstances. The further anonymous complaint (believed to have been written by a member of the hospital staff) was received in January 1995 and cited "acts of negligence and malpractice" by the Applicant. The report gives comprehensive details of the Superintendent's interviews with three hospital doctors, the sister and nurse of the Outpatient Department and the Applicant. The report details numerous cases of inadequate, inappropriate and negligent medical treatment given by the Applicant. It notes that the Applicant denied all wrongdoing and was very defensive about the allegations made against him. The Medical Superintendent concludes that the Applicant "definitely lacks the necessary knowledge and skill required in medicine". He makes several possible recommendations including an independent assessment of the Applicant's knowledge and skills, completion of the contract with demotion to a lower grade and possible termination of the contract.

The second report dated 20th November 1995 was prepared by the Medical Superintendent following a complaint to the Police by a female patient that she had been "sexually molested" by the Applicant. The Superintendent gave details of his discussion with the complainant in the presence of police officers. She said that she attended the Outpatients' Department because of chest pain and was subjected to a vaginal examination. The Superintendent said that he had interviewed the Applicant about the matter and the Applicant had admitted carrying out the vaginal examination without a nurse being present. The Superintendent stated that a vaginal examination without a nurse being present is against hospital regulations and that the patient's symptoms would not have indicated the need for a vaginal examination. The report then refers to previous correspondence regarding allegations of misconduct and malpractice against the Applicant. The Superintendent then states:

"The present allegation is probably the most worrying and is yet another addition to a long line of dubious practices. To be honest I am now fed up with meeting and/or talking with this officer almost on a weekly basis for counselling and warnings. May I once again advise the Ministry that this officer's contract be terminated at the earliest possible."(sic)

The report concludes by giving six "examples of recent complaints". These were serious matters and include, for instance, an alleged misrepresentation of injuries in a medical report for the Police. It was alleged that the Applicant applied a plaster cast when no fractures were shown on Xray and that this was done to assist the patient with his complaint to the Police.

It was on the basis of this background and the information contained in the two reports that the Respondent finally decided on 6th March 1996 to terminate the Applicant's Agreement of Service for "unethical conduct and unsatisfactory performance".

The question to be determined on the present application for leave to commence judicial review is whether it is arguable that the Respondent's decision to exercise its rights under the Agreement of Service (and not the actual termination of the employment) was not made in good faith and for the public good. In my view such an argument cannot be sustained, even on a prima facie basis.

The Applicant was employed by the Respondent on behalf of the Government to "diligently and faithfully perform the duties of Medical Officer in the Ministry of Health" (paragraph 2(1)(b) of the Agreement of Service). He was employed at Labasa Hospital which is a public hospital maintained out of public funds. The Permanent Secretary for Health exercises "general control and supervision over the organization of all public hospitals" (Regulation 4 Public Hospitals and Dispensaries Regulations). The Government, acting through the Ministry of Health and the Respondent has assumed responsibility for the provision of public hospital services for the nation. Those Departments (in this case, particularly the Respondent) have a public duty to ensure that proper medical care and treatment is given in public hospitals. That necessarily includes a duty to provide competent medical staff. In the public interest, the integrity of the medical staff must be maintained.

In the present case the Respondent clearly had these duties and purposes in mind when it decided, in its discretion, to exercise its powers under the Agreement of Service. It had abundant information that the Applicant lacked the necessary integrity and medical skills required for the provision of public hospital services. The public good required that consideration should be given to terminating the employment. The Respondent was acting in good faith when it took into account and acted upon the contents of the two reports received from the Medical Superintendent of Labasa Hospital. The decision was not made on some capricious or groundless or (as in Korovulavula's case) unlawful basis. It was a decision made on proper grounds in the public interest.

It was submitted on behalf of the Applicant that a "proper internal inquiry" should have been made into the allegations and the Applicant had "a right to be heard on any adverse matters relating to his conduct and performance". However this case is not concerned with procedures for dismissal of an employee under the PSC Regulations which may require a fair hearing as a matter of natural justice before a dismissal decision is made. The present inquiry relates to a discretionary decision to invoke rights under a contract of employment. The public law issue arising in those circumstances is whether that decision was made in good faith and for the public good. It was, and the Respondent was therefore entitled to exercise the contractual right of termination. In any event, the reports made by the Medical Superintendent show that the Applicant had been advised of the complaints, had been given opportunities to explain them and had been regularly counselled and warned over a long period.

For all of the foregoing reasons I conclude that this is not a case where leave should be granted to bring an application for judicial review. The Applicant has not raised, within the limited confines of the public law issue arising in this case, a sufficiently arguable case to warrant a full investigation at a substantive hearing. Indeed, in my judgment, this is not a case for judicial review. The Respondent did not act in breach of its duties as a public authority when it decided, as a matter of discretion, to exercise its rights under the Agreement of Service to terminate the Applicant's employment.

The application for leave to apply for Judicial Review is refused.

Justice D.B. Pain