IN THE SUPREME COURT OF
THE REPUBLIC OF VANUATU
(Civil Jurisdiction)

CIVIL CASE No. 167 of 2002

BETWEEN:

SNOOPIES STATIONARY & OFFICE SUPPLIES LTD
Plaintiff

AND:

NADINE HAINES
Defendant

Counsels: Mr. Silas Hakwa for the plaintiff
Mr. Nigel Morrison for the defendant

JUDGMENT

The plaintiff by way of Writ of Summons dated the 7th of October 2002 applied for damages against the defendant for various misrepresentations made by the defendant. The plaintiff’s claim is recorded in pages 3, 4, and 5 of the statement of claim.

The defendant denies each and every allegation and particularly any wrongful or unlawful acts as alleged or at all and any loss or damages resulting therefrom. The defendant denies every allegation as to paragraph 19 and 20 of the statement of claim and particularly any entitlement to damages as claimed by the plaintiff.

The plaintiff carries on business in office stationary, equipment, machinery, books, goods or supplies both as a retailer and wholesaler in Port Vila and throughout the Republic of Vanuatu. The General Manager of the plaintiff is Daniel Guy Joli.

The defendant was previously employed by the plaintiff until 09 April 2002 when her employment was terminated. At various times during her employment, the defendant would perform various duties or responsibilities as directed by the plaintiff.

In early February 2002, as a result of continuous heavy rain, there was a lot of damage caused to various stationary or goods maintained at the Plaintiff’s shop premises in Port Vila. Following such damage, the defendant called the General Manager by telephone to advise her. The General Manager instructed the Defendant to undertake an assessment of the damage or loss and thereafter attend to the filing of an appropriate application claim with the plaintiff’s insurer for payment.

On or about 09 April 2002, the plaintiff terminated the defendant’s employment with the plaintiff.

Sometime after 09 April 2002, the defendant on separate occasions falsely and maliciously spoke and publish of the plaintiff and or its General Manager, and of them the way of their business to Loic Bernier and David Conwell, respectively the representative and Loss Adjuster for the plaintiff’s insurer words or words to the effect

“that Daniel Joli and or the plaintiff had ordered the defendant to wet some stock deliberately and thereafter make a claim for the plaintiffs insurer to pay for damage caused to stock as a result thereof”.

The plaintiff said the above words harm the good character and reputation of the business and himself. 

Following enquiries made by Mr. Conwell, the General Manager became aware of the various malicious, false and or misrepresentations which the defendant had previously made and published to Mr Loic Bernier and Mr. Conwell. As a consequence of the said publication of the words made by the defendant, the plaintiffs insurer refused to make any payment in respect of the plaintiffs claim.

The General Manager made enquiries then advised Mr. Conwell that part of the stock was wet deliberately by an employee of the plaintiff acting upon the wrongful and or unlawful instruction of the defendant. By reason of the foregoing, the plaintiff has suffered damages and or loss.

The defendant on the other hand says that she was involved in the wetting of stock on the clear orders of the General Manager of the plaintiff and has been honest in respect to her actions at all times when enquiries has been made by any insurers or investigating agents.

The defendant by way of Affidavit says she has telephoned Mr. Joli and reported to him about further damage. Mr. Joli then gave her instructions to identify stock, which were big quantity items and had not been sold for a long time. Also to identify items that had been sitting in the warehouse at high costs to the business. He then directed her to wet those items together with the help of her husband Patrick Heines. The plaintiff directed the defendant to ensure that the claim when made it to the insurers was for more than 1 million Vatu.

On the basis of the plaintiff’s authorisation to the defendant, the defendant denies the plaintiff’s entitlement as to damages as claimed in the statement of claim. The defendant says that her actions were not wrongful or unlawful as alleged by the plaintiff. She said her actions were the direct result of the plaintiff’s instruction to be engaged in such an dishonest activity.

It is no doubt, the law that the assured who makes a claim must establish that the loss comes within the ambit of the policy. He must show that the event covered by the contract of insurance has occurred, that loss has been suffered by him as a result and that the event is the proximate cause of the loss.

If a policy purports to indemnify the assured against all losses which the latter suffers through errors or omissions of himself or his employees in the conduct of his business, this may preclude any indemnity in respect of loss resulting from a wilful or deliberate act or omission, although the wilful failure of an employee to effect an insurance will not necessarily be imputed to his employer 

The policy does not cover the assured against loss suffered by him by reason of his employee’s negligence

The Court has applied its mind to the evidence put forward by the parties. I have read in detail the Affidavits of the plaintiff and the defendant. I have considered thoroughly and carefully the evidences put forward by relevant witness of both parties.

I must say that the root of this contention branches out from the authorisation to water the stock so that the claim when made to the insurers will be more than 1 million vatu. This must be done in order to satisfy the insurance policy.

The question is, is the plaintiff responsible in instructing the defendant to water the stock? The question can be answered by analysing the powers and functions of the plaintiff as the Managing Director of the company and the defendant as an employee and assistant Managing Director to the plaintiff.

The plaintiff is the Managing Director of the company and at all material times do act as a General Manager, having overall management responsibility over all the operations of the company.

At all material times and during which the plaintiff employed the defendant, the defendant provided various services to the plaintiff at senior management level. At various times during the defendant’s employment, the defendant assisted the plaintiff in various duties in the management and operation of the various businesses of the plaintiff.

During the defendant’s employment and in most occasions, the defendant had exercised supervisory control over various junior staff in respect of their respective duties and the defendant was able to carry out most of her duties without any direct supervision.

It is revealed from the evidence of the plaintiff that at various times when the plaintiff was absent from work, the defendant would carry out such tasks or work, which the plaintiff would normally carry out himself.

The defendant says her work duties include looking after the good running of the Company with Mr. Daniel Joli, ordering goods overseas and locally, preparing wages, stock control, banking, end of days debtors and creditors, bank reconciliation, preparing VAT Returns for both Companies, i.e. Snoopy’s and Orchid LTD and looking after customers.

The defendant said she perform other duties directed by Mr. Daniel Joli, such as driving his children from home to school, going to market, shopping, also cooking sometimes and looking after his children.

In her affidavit, the defendant says whenever the plaintiff travelled abroad or absent from work, it becomes her responsibility to manage the shop on a day to day basis. At such time all reporting were addressed to her rather than Mr. Joli when he was present. And thereafter she reports back to Mr. Joli after hours or by phone.

I note with respect that the defendant’s responsibility to manage the shop on a day to day basis is not absolute or final. The defendant was engaged in usual practice where reporting back to the General Manager, the plaintiff, is very important. I cannot depart from this reality. The reporting does not culminate only on the ‘wet stock issue’, the defendant reports to the plaintiff in earlier occasion regarding the leaking of water on the stock to which the plaintiff did nothing. This is transpired on the defendant’s evidence.

The plaintiff in his statement of claim said in point 4, the following words,

‘at various times during her employment, the defendant would perform various duties or responsibilities as directed by the plaintiff.

The plaintiff is affirming the reality of the situation. The defendant would perform various duties or responsibilities as directed by the plaintiff. I cannot depart from that powerful assertion. 

I must record it clearly that on that date in question; the defendant with the help of the other employee watered the stock on the pure and genuine instruction of the plaintiff. It is regardless of whether the defendant has informed the other employee or not to water the stock. The defendant when instructed by the plaintiff has the power to give directions to the employees without questioning the integrity of her position that derives from the fundamental instructor, the plaintiff. 

 The defendant is the servant of the plaintiff this is because she was subjected to his directions as was transpired on the defendant’s affidavit. The interests and the welfare of the business absolutely rest on the shoulders of the plaintiff. The plaintiff directs the good will of the business. I must say that the plaintiff makes final decisions and not the defendant. I find that the plaintiff’s instructions to the defendant were dishonest.

 If dishonesty is sowed along the paths of administration, the fruition will bear its manifestation in its due season. It is one of premature and shameful harvest. I must discourage this kind of practice or it will loom the integrity of the innocent.

On that basis, I must reject the evidence of the plaintiff. I found in favour of the defendant.

Dated at Port Vila this 8th day of September 2003

BY THE COURT

VINCENT LUNABE
CHIEF JUSTICE