IN THE HIGH COURT OF TUVALU
IN FUNAFUTI
Civil Jurisdiction

Case No: 3/04

Between:

Malama Lipine Paeniu
Plaintiff

And:

Tuvalu National Council of Women
Defendant

BEFORE THE CHIEF JUSTICE

Barlow for Plaintiff
Isala for defendant

Hearing: 11 and 12 October 2005 
Judgment: 14 October 2005

Judgment

This is a claim for damages for breach of contract. Most of the facts are agreed and it is convenient to set out the statement of agreed facts.

"On 17 September 2001 the plaintiff was appointed to the position of Coordinator of the Tuvalu National Council of Women (TNCW). The appointment was made by way of letter signed by the Vice President of TNCW, Lagi Etoma.

The plaintiff accepted the appointment and requested for her employment to commence in October 2001 so that she could give one months notice to her employer at the time.

On 5 October 2001 TNCW entered into a Memorandum of Understanding (MOU) with Pacific Foundation for the Advancement of Women (PACFAW). As part of the MOU, PACFAW agreed to fund the salary of the National Gender Officer and TNCW agreed to engage a full time National Gender Officer. The MOU agreement was for a period of 36 months commencing on 1 October 2001 until 30 September 2004. The three year budget for the project was Euro 67,505.00.

On 24 October 2001 the President of TNCW, Katalaina Malua, wrote to the plaintiff by letter.

The letter advised the plaintiff that she would commence employment on 1 November 2001 and:

‘Your additional new appointment as National Gender Officer within the organisation. Now you are holding two titles which are TNCW Coordinator/National Gender Officer (PACFAW).

Please omit your previous appointment terms and conditions and find the following are your new appointment terms and conditions:

1.	Post – Coordinator / National Gender Officer
2.	Salary – Euro 13472.00
3.	Leave entitlement – 30 days
4.	Date of appointment – 1 November 2001

Besides your responsibilities as Coordinator, find the following are your new national gender responsibilities:’

On 24 November 2003 the Executive Director of PACFAW, by way of letter, wrote to Katalaina Malua, President of PACFAW [sic]. The letter advised TNCW that they had breached the terms of the MOU and that "the PACFAW project in Tuvalu is hereby terminated effective immediately, which therefore means that there will be no further funding."

The plaintiff’s salary was not paid after November 2003. The plaintiff commenced annual leave in early December 2003.

On 29 January 2004 the Vice President of TNCW contacted the plaintiff and advised her that her annual leave had finished and requesting the plaintiff to resume duty.

On 30 January 2004 the plaintiff returned to work. On that same day the plaintiff spoke to the Vice President of TNCW and requested for her salary payments to be made, as she had not been paid whilst on leave.

Later that day the plaintiff was advised by the Vice President of TNCW that she would not receive any salary payments.

The plaintiff then left the office and did not return to work.

On 9 February [2004] the plaintiff wrote to the President of TNCW by way of letter raising her concerns in relation to her position.

On 25 February 2004, the plaintiff by way of letter advised TNCW of her resignation and gave one month’s notice from that date. Resignation was to be effective on 31 March 2004.

TNCW, by way of letter dated 25 February 2004 accepted the plaintiff’s resignation."

Most of the documents referred to were exhibited as agreed documents.

Only two witnesses were called, the plaintiff and the President of the TNCW. Their evidence revealed some further, largely undisputed, facts.

A document attached to the MOU showed that, of the total sum of Euros 67,505.00 to be paid by PACFAW, Euros 40,416.00 was the salary of the plaintiff. The plaintiff agreed she had seen the MOU when she first started work in November 2001.

The MOU required the TNCW to engage a full time National Gender Officer but it was clear that the TNCW also expected the plaintiff to carry out the duties normally expected of the TNCW Coordinator which included supervising the office and the staff, the Handicraft Centre and the snack bar run by the TNCW. The plaintiff’s evidence was that she had been told that the National Gender Officer was a "job with duties to PACFAW".

Over the two years she worked in the combined post, the plaintiff found the duties arising from her role as National Gender Officer grew steadily more onerous and it became correspondingly difficult to complete them. She told the Court that she discussed this with the executive committee and a letter was written, in about June 2003, by the Secretary of TNCW to the Director of PACFAW pointing out that "one cannot do two jobs at a time" and asking that the Council be allowed to appoint an additional member of staff to work with the plaintiff and share the budget allocation. Unfortunately, no answer was received and the next communication was the letter of 24 November 2003 advising that the funding was to cease.

The evidence showed that relations between the President and the plaintiff deteriorated over the period of the plaintiff’s employment and the plaintiff agreed that she had been warned both by letter and orally and told to improve her performance at work. The plaintiff admitted that she had not been able to keep up with the reports which the PACFAW project required and she also accepted the suggestion that the funding was stopped partly because of her failure to complete the reports required for the PACFAW project in time.

The evidence of the President included a number of criticisms of the plaintiff with the clear suggestion that the plaintiff had effectively been dismissed. No such allegation had been pleaded and the allegations were irrelevant except to confirm the rancour between the two women.

The plaintiff told the Court how she received the notification of the cessation of funding by facsimile from PACFAW and immediately told the Secretary of TNCW. A meeting was held between the plaintiff, the Secretary and the President. At that meeting the President said the plaintiff must stop working because the funds had stopped and the post of Coordinator was also terminated. The Secretary, however, pointed out that such a decision had to be made by the executive committee and the President agreed. The President’s evidence of the meeting after the fax had been received was that it was decided to put it to the committee to consider terminating the plaintiff’s contract and the plaintiff was told to stop working.

Unfortunately, it appears it was not discussed or, if discussed, it was not decided by the executive committee at that time. Had it been and the plaintiff so advised, this case might not have been necessary. The evidence shows that it was not finally considered by the executive committee until late February, after the committee had received the plaintiff’s letter of resignation.

The plaintiff went on leave in early December. She had worked a year since her last leave and was taking her entitlement. It is significant that she did not start leave immediately after the communication from PACFAW. She continued with her work on the preparations for the various activities for HIV/AIDS day.

On 29 January, the Vice President telephoned her and told her that she should have returned from leave and so the plaintiff returned to work the next day. Although she had been paid fortnightly, she had not received any pay during her leave and, on her return, she raised the matter with the Vice President who told her to wait while she rang the President. Having done so, she told the plaintiff that she was not going to receive any more pay. The plaintiff responded by saying she would not return to the office until she was paid.

The President told the Court that there was a meeting of the executive committee in February at which they discussed the concerns expressed by the plaintiff in her letter of 9 February 2004. There is no evidence whether any decision was reached.

On 25 February 2004, the plaintiff was asked to attend a further meeting of the executive committee but she wrote declining on the basis that she had received legal advice and continued by tendering her resignation:

"Due to the prolonged period since 1 December 2003 of which no satisfactory response has been made by the Council regarding the position of Coordinator. I therefore submit this letter to hand in my resignation from the above position. As you are aware that due to the Council’s conditions whereby one month notice should be given before resignation, my resignation therefore should be effective from the 31 March 2004.

Aside from my resignation I would be grateful if you could pay my outstanding salary from the month of December 1 2003 to 31 March 2004. I believe you are also aware that my fortnightly Gross Salary is $881.17"

The resignation was discussed at the meeting and, later the same day, the President replied:

"Thank you for your resignation letter which I have received. I write on behalf of the Council of Women to inform you that we have approved your resignation from the position of Coordinator of TNCW according to the grounds listed below.

1.	The PACFAW project which also funded your salary has ceased on the 24 November 2003.
2.	There are no funds to pay your salary.
3.	There was no commitment on your part to conduct your work productively. Most of the time you failed to conduct your work professionally or even accept directives handed by the Working Committee.
4.	From the various directives, letters of encouragement from the Council to improve your work, we note that there was no improvement to your work.

I therefore take this opportunity on behalf of the Council of Women to thank you for having worked with us, and we wish you all the best in your future endeavours."

It should be noted that the letter she referred to when accepting the resignation had also requested payment of salary arrears and salary due. There is no suggestion in the President’s letter that was not also accepted or, indeed, that the contract had long since been terminated; as is pleaded by the defence. Had the Council believed the post ceased at the time of the fax from PACFAW and that there was no obligation to pay after that, it is reasonable to expect that would have been clearly stated. 

The plaintiff claims the failure to pay was a breach of contract and seeks payment of her salary for the period stated her letter. She also claims general damages for the adverse effect on her reputation, in terms of possible future employment, as a result of these events.

The defence is clearly set out in paragraphs 3 – 5 of the amended statement of claim:

"3 The defendant says that the plaintiff’s contract was formally terminated by the PACFAW Executive director by her letter dated 24 November 2003 and on or about the 3 December 2003 the plaintiff had knowledge of that termination.

The defendant further says that the funding of the plaintiff’s job is subject to a MOU between the PACFAW and the TNCW.

4. The defendant admits of receiving the plaintiff’s resignation letter on the 24 February 2004. The requirement of one month notice to her resignation is not applicable to her as she was fully funded by an overseas organisation. The plaintiff submitted her resignation after her contract had terminated.

5. No contract of employment existed between the plaintiff and the defendant after the 24 November 2003 an as such there is no ground for filing a resignation letter."

The facts do not support the defence contention and counsel for the defendant conceded in his final address that the contract was as stated in the letter of 24 October 2001 and was between the plaintiff and TNCW. He was right to do so. I fail to see how the fact that her salary was paid under a MOU between her employer and PACFAW could alter the contract without an express amendment. It was not, and cannot be, suggested that the plaintiff was a party to the MOU. I equally fail to understand the submission that, when the funds ceased, the plaintiff’s employment with TNCW ceased. Such a decision could only be made by the executive committee and there is no evidence of such a decision prior to the acceptance of the plaintiff’s resignation.

The MOU, signed by the president on behalf of TNCW, is based on the clearly stated understanding that the National Gender Officer was to be employed by, and under the control of TNCW. It states:

"TNCW Agrees to:
1.Engage a full time National Gender Officer whose duties are: …
2 Administer all funds under this agreement
3.Supervise and administer the work of the NGO"

It could not be plainer that PACFAW took no responsibility for the employment of the plaintiff or for the standard of her work. Even if it was her poor performance that caused the funding to cease, and that is not entirely admitted by the plaintiff or proved on the evidence, it was the responsibility of TNCW to supervise and the failure was the Council’s for not properly carrying out its agreed duty under paragraph 3. If, as was plainly being suggested by the President’s evidence and the rather ungracious terms of the letter accepting the resignation, the plaintiff’s work had not for some time been up to the standard required for PACFAW funding, TNCW’s duty under the MOU was to have taken proper steps to dismiss or transfer her and employ someone better able to carry out the duties.

The evidence suggests that any shortcomings in the plaintiff’s work arose to a great extent, from the unrealistic assumption by TNCW that doubling the pay meant one person could take on the work of two fulltime positions. It appears that realisation that may be fallacious only dawned in mid-June 2003 when the secretary wrote to PACFAW. There is no evidence why the request was not answered but a probable reason is that PACFAW took the view it was a matter entirely for TNCW under the MOU.

I am also satisfied that the evidence of events after the faxed letter from PACFAW is consistent with a contract of employment continuing and being accepted as such by TNCW. The fact the plaintiff continued to prepare for HIV/AIDS day before taking her leave shows that the President’s suggestion she should stop work was stayed pending a decision of the executive committee. The advice by the Vice President that the plaintiff’s leave was complete and she should return to work and the plaintiff’s acceptance of the advice are consistent with continuing employment. Similarly the unqualified acceptance of the plaintiff’s resignation and the omission of any challenge to the length of notice or the request for payment also show a continuing acknowledgment of a continuing contractual relationship. I also note that the plaintiff’s reference to notice was clearly linked to the original contract of employment.

This is simple case of breach of contract. I am satisfied to the civil standard that the plaintiff was employed on a contract in the terms of the letter of 24 October 2001 and continued in that employment until the end of the one month notice given at her resignation.

There is no credible evidence that the salary stated in her contract with TNCW was conditional on continued funding from PACFAW or that such a suggestion was ever made to her until the funding ceased. She is entitled to her salary for the period she was employed but not paid which is from1 December 2003 to 24 March 2004, which is one month from the acceptance of her resignation.

The plaintiff also claims general damages for the adverse effect of the termination of her employment with TNCW on her chances of future employment - her ‘employability’, as counsel aptly expressed it.

The plaintiff gave evidence of having applied for a number of positions in all of which she was unsuccessful. There is no evidence that her lack of success arose in any way from the facts of this case. Indeed the fact her employment ended when she offered her resignation and it was accepted does not support such a claim. I appreciate that, in a society as small and close as Funafuti, inaccurate rumours arise frequently and may have a very profound effect but, without evidence of any such rumour and of its effect, this ground cannot succeed and it is refused.

Thus I give judgment to the plaintiff and order that the defendant shall pay the plaintiff for the period of 1 December 2003 to 24 March 2004 at the rate stated in the letter of appointment dated 24 October 2001.

I further order that there shall be interest at the rate of 5% per annum from 24 May 2004, the date of filing the claim, to the date of payment.

I make no order for costs.

Dated: 10th day of October 2005

CHIEF JUSTICE