Wee Kim San Lawrence Bernard v Robinson & Co (Singapore) Pte Ltd

• Jurisdiction: Singapore
• Judge: Sundaresh Menon CJ
• Judgment Date: 07 August 2014
• Neutral Citation: [2014] SGCA 43
• Court: Court of Appeal (Singapore)
• Docket Number: Civil Appeal No 126 of 2013
• Year: 2014
• Published date: 15 August 2014
• Hearing Date: 29 May 2014
• Plaintiff Counsel: Paul Tan (instructed) and Choo Zheng Xi (Peter Low LLC)
• Defendant Counsel: M K Eusuff Ali, Megan Chia and Lucinda Lim (Tan Rajah & Cheah)
• Subject Matter: Civil Procedure,Striking Out,Employment Law
• Citation: [2014] SGCA 43

Sundaresh Menon CJ (delivering the grounds of decision of the court): Introduction

This appeal arises from an application to strike out a claim for damages for constructive dismissal and, alternatively, breach of the implied term of mutual trust and confidence in a contract of employment. The key issue in this appeal concerns the extent of damages that can theoretically be claimed in such circumstances.

Background facts

The appellant in this case is Mr Wee Kim San Lawrence Bernard (“the Appellant”). From 9 October 2006 until the end of August 2012, the Appellant was employed by the respondent, Robinson & Company (Singapore) Pte Ltd (“the Company”), a retailer which operates the “Robinsons” brand of department stores in Singapore.

The Appellant resigned from the Company on 24 August 2012. It is not disputed that the Company paid the Appellant four months’ salary in lieu of notice and the appropriate amount in cash for his unconsumed annual leave. This was despite the fact that the Appellant’s contract of employment provided for payment of only two months’ salary in lieu of notice. The relevant provision in the contract was as follows:¹

NOTICE OF TERMINATION … After confirmation, written notice of termination from either party will be two (2) calendar months or two (2) calendar months’ salary in lieu of such notice without assigning any reasons whatsoever. …

On 6 December 2012, the Appellant commenced Suit No 1036 of 2012 (“the Suit”) against the Company seeking damages for constructive dismissal. He claimed that he had been forced to resign as a result of persecution and unreasonable bias that had been directed towards him by the Company or its officers. In the alternative, the Appellant claimed that the Company had breached the implied term of mutual trust and confidence in his contract of employment with the Company.

On 18 June 2013, the Company filed Summons No 3064 of 2013 (“SUM 3064/2013”) with a supporting affidavit to strike out the Suit. On 15 July 2013, the Appellant filed an affidavit to oppose the Company’s striking-out application. In response, the Company filed Summons No 3969 of 2013 to expunge two paragraphs of the Appellant’s affidavit. The summonses were heard on 6 August 2013 by an assistant registrar (“the AR”), who granted both applications.

Thereafter, on 20 August 2013, the Appellant filed Registrar’s Appeal No 286 of 2013 (“RA 286/2013”) against the AR’s decision to strike out his claim and Registrar’s Appeal No 287 of 2013 against the AR’s decision to strike out the two paragraphs of his affidavit. The two appeals were heard together on 9 September 2013 by a High Court judge (“the Judge”), who dismissed both appeals. The Judge’s grounds of decision are reported in Wee Kim San Lawrence Bernard v Robinson & Co (Singapore) Pte Ltd [2014] 1 SLR 1382 (“the GD”).

The Appellant appealed to this court against the decision of the Judge. Although the Appellant’s notice of appeal stated that the appeal was against the whole of the decision given by the Judge on 9 September 2013, it was subsequently clarified that the appeal was only in respect of the Judge’s decision in RA 286/2013 upholding the AR’s decision to strike out the Appellant’s claim. We shall therefore deal with only SUM 3064/2013 and RA 286/2013 in these grounds of decision.

On 29 May 2014, after hearing submissions from counsel, we dismissed the appeal and gave brief grounds. We now give the detailed reasons for our decision. Before that, however, it is essential that we briefly outline and explain the arguments made by the parties at various stages of these proceedings, which in turn shaped the issues that arose for our determination.

The arguments and the proceedings below The Suit

As stated above, the Suit was commenced by the Appellant against the Company for damages for constructive dismissal and, alternatively, breach of the implied term of mutual trust and confidence in his contract of employment with the Company.

Pertinently, in relation to the alternative claim for breach of the implied term of mutual trust and confidence, the writ of summons filed by the Appellant stated as follows: 9. Further or in the alternative, the [Appellant’s] claim against the [Company] is for breach of [the] implied term of mutual trust and confidence in the [Appellant’s] employment agreement with the [Company].

PARTICULARS OF CONSTRUCTIVE DISMISSAL

(a) There is an implied term of mutual trust and confidence in relation to the [Appellant’s] employment agreement with the [Company], which the [Company] profess to uphold in their Fair Employment Practices’ tagline “We are proud to be an equal opportunity employer”. (b) It is further clear, in the treatment of the [Appellant], that the [Company] had acted unfairly in the [sic] breach of the implied term of mutual trust and confidence, and had, therefore, repudiated the [Appellant’s] contract of employment and effected a constructive dismissal[.] The striking-out application Before the AR

The Company applied in SUM 3064/2013 to strike out the Appellant’s claim in the Suit pursuant to O 18 r 19 of the Rules of Court (Cap 322, R 5, 2006 Rev Ed) (“the Rules”) on the ground that it was frivolous, vexatious and an abuse of process. The Company submitted that the Appellant’s claim was legally unsustainable because even if the Appellant had been constructively dismissed (which it denied), he would not have been entitled to anything more than two months’ salary as stated in his employment contract. As it was, he had already received more than this amount. Moreover, the Company argued, the Appellant’s claim was an abuse of process as it had been commenced for the collateral purpose of exerting pressure on the Company to pay him additional sums.

The Appellant’s argument in response was that his cause of action in constructive dismissal was legally and factually sustainable. Relying on the decision of the House of Lords in Malik v Bank of Credit and Commerce International SA [1998] AC 20 (“Malik”), among other case authorities, the Appellant argued that he could mount a claim against the Company for continuing financial loss beyond the contractual notice period stated in his employment contract if the Company had breached the implied term of mutual trust and confidence, resulting in a loss of future employment prospects.

The AR granted the Company’s striking-out application, noting that the Appellant had not pleaded any special damages for his alleged inability to secure employment following his alleged constructive dismissal by the Company.

Before the Judge

In the Appellant’s appeal against the AR’s decision in SUM 3064/2013 (ie, RA 286/2013), the parties’ arguments and their respective positions remained largely unchanged. In particular, the Company reiterated its position that although it did not agree that the Appellant had been constructively dismissed, for the purposes of its striking-out application, it would proceed on the assumption that that was indeed the case. On that basis, the Company submitted that since the Appellant had already been paid more than his contractual entitlement of two months’ salary in lieu of notice, he was not entitled to any further payments. The Company further submitted that Malik was of no relevance since that case related not to a cause of action founded on constructive dismissal, but to a separate cause of action for damages constituted by a loss of future employment prospects.

The Judge dismissed RA 286/2013, holding that the Appellant’s claim was “doomed to fail” (see the GD at [30]) because even if he had been constructively dismissed, he would only have been entitled to two months’ salary in lieu of notice as stated in his employment contract, and he had already received more than that. The Judge also stated that Malik did not assist the Appellant since his statement of claim did not disclose any particulars relevant to establishing a breach of the implied term of mutual trust and confidence; neither had the Appellant particularised his claim for “stigma” losses or damages flowing from the alleged breach.

The arguments before this court

In his written submissions, the Appellant raised three main arguments as to why the Suit should not be struck out: first, there was an arguable case that he was entitled to damages exceeding the amount of salary payable for his contractual notice period if such damages flowed from the breach of the implied term of mutual trust and confidence in his contract of employment with the Company; second, he was entitled to seek declaratory relief as to whether there had been a breach of the implied term of mutual trust and confidence that entitled him to resign; and third, there was a conflict of evidence as to the nature and purpose of the Company’s payment of four months’ salary to him.

The Appellant’s position, especially with regard to his first argument stated above, was clarified in oral submissions by his counsel on appeal, Mr Paul Tan (“Mr Tan”). Mr Tan clarified that the Appellant’s claim was neither for loss of future employment prospects as in Malik, nor for other types of continuing or post-termination financial losses arising from his dismissal. Instead, the Appellant was only claiming damages in respect of the alleged financial loss arising from the premature termination of his employment with the Company. Mr Tan submitted that the Appellant’s claim for damages beyond the amount of salary payable for his contractual notice period was legally sustainable because damages flowing from a breach of the implied term of mutual trust and confidence in a contract of employment had to be assessed in accordance with normal contractual principles. According to Mr Tan, this would be so even if, as in this case, the only consequence of the breach was that it brought the contract of employment to a premature end. In...