002-SLLR-SLLR-1982-2-SHAW-WALLACE-AND-HEDGES-LTD-v.-PALMERSTON-TEA-CO.-LTD.-AND-OTHERS.pdf
sc
Seneviratne v. Seneviratne and Another (Victor Perera, J.)
427
SHAW WALLACE AND HEDGES LTD.
v.
PALMERSTON TEA CO. LTD. AND OTHERS
SUPREME COURT
SAMARAKOON. C.J., WANASUNDERA, J., AND SOZA, J.
S.C. APPEAL NO. 9/81; 21/82MAY 19, 1982.
Industrial dispute – Termination of employment – Industrial Disputes Act, s. 48- Who is an 'Employer' – Land Reform Law, Section 42 B 5 (a)
The petitioner was employed as Superintendent, Queensland Estate, Maskeliya.His services were terminated on 27.0S.71. The estate was owned by Palmerston
428
Sri Lanka Law Reports
(1982) 2 S.L.R.
Tea Co. Ltd. and managed by Shaw Wallace and Hedges Ltd. who were Doirtmanaging agents and secretaries.
At the request of the petitioner the Minister of Labour referred the disputeregarding dismissal to the Labour Tribunal for arbitration under section 4(1) ofthe Industrial Disputes Act.
' In the course of the inquiry the appellant objected to further proceedings onthe following grounds.
■
; i*
L' Messrs Shaw Wallace and Hedges was only an agent and could nuit be madea party.
2. Queensland Estate vested in the Land Reform Commission and consequentlythe liabilities of Messrs Palmerston vested in the Land Reform Commission.
The Arbitrator terminated the inquiry on upholding• the above objections.'TheCqurt of Appeal issued Writ of. Certiorari quashing the order and Writ ofMandamus ordering continuance of inquiry. On appeal to Supreme Court –
Held –
Liabilities-vested in the Land. Reform Commission and hence no liability'■ attached to'Palmerston Tea Co. Ltd. .
IThe contract of employment was with Palmerston i.ea Co. and not withShaw Wallace and Hedges. Hence Shaw Wallace and Hedges could not bemade a party.
Cases referred to:
Carson Cumberbatch and' Co. Ltd. v. Nandasena (1973) 77 N.L.R. 73. 84
Archer v. Kelly 1 Dr. & Sm. 300
Williams v. Williams (1911) 1 Ch. D. 450APPEAL from order of the Court of Appeal.
E.R.S.R. Coomaraswamy .with N-T.S. Kularatne and Nilantha Herath for res-pondent.
Mark Fernando for appellant.
Cur.adv.vult.
SC Shaw Wallace v. Palmerston Tea Co. and Others (Samarakoon, C./.j429
May 27, 1982.
SAMARAKOON; C.J.
The petitioner-respondent (hereinafter referred to as the petitioner)was employed as Superintendent, Queensland Estate, Maskeliya andhis services were terminated on 27th May, 1971. The Estate wasowned by the Palmerston Tea Co. Ltd (hereinafter referred to asthe 1st respondent). It was managed by Messrs Shaw Wallace &Hedges’ Ltd. (the appellant) who were the Managing Agents ‘andSecretaries of the 1st respondent. On the 9th September, 1971, thepetitioner made an application to the Labour Tribunal, citing the 1strespondent and the appellant as employers, and complaining thatthey had illegally and without justification terminated his employment.By way of relief he claimed reinstatement in employment with backwages, compensation and gratuity. This application was not pursuedbecause the then Supreme Court in November, 1971, ruled that anapplication made after the expiry of. three months from date oftermination was barred by effluxion of time. By a letter dated 14thOctober, 1972, the petitioner appealed to the then Minister of Labourto get him out of the difficulty by making a reference under theprovisions of section 4(1) of the Industrial Disputes Act (Chapter131). The Minister acceded to this request and. referred the disputeto Labour Tribunal No.II for arbitration. The 1st respondent andthe appeallant were made party respondents. The reference was asfollows:-
‘The matter in dispute between the aforesaid parties iswhether the termination of services of Mr. C. H. C. de Runby the Management of Queensland Estate, Maskeliya, is justifiedand to what relief he is entitled to.”
It is relevant to note that in this reference the 1st respondent isdescribed as the proprietor of Queensland Estate and the appellantas the agent of the 1st Respondent. The parties filed their respectivestatements before the Arbitrator and the inquiry commenced. Onthe 9th May 1975 which was the twentieth day of hearing, Counselfor the two Companies objected to further proceedings being heldfor the following reasons:-
'I That Messrs Shaw Wallace & Hedged was only an Agent andcould not be made party to the reference.
430
Sri Lanka Law Reports
(I<i82) 2 S.L.H.
That Queensland Estate had become vested in the LandReform Commission by the provisions of amending Act 39 of1975, and by reason of the provisions of Section 42B(5) ofthe amending Act the liabilities of Messrs Parmerston TeaCo. Ltd have become the liabilities of the Land ReformCommission. The reference was therefore frustrated.
The Arbitrator by his ruling of 5th July 1976, upheld both contentionsand held that for these reasons the Tribunal had no jurisdiction toproceed with the matter. The petitioner thereafter applied to thethen Supreme Court for a Writ of Certiorari to quash the said orderof the Arbitrator and for a Writ of Mandamus to compel theArbitrator to continue the arbitration proceedings to a conclusion.The appellant and the 1st respondent resisted this application. TheCourt of Appeal allowed both writs and directed the Arbitrator tocontinue and complete the inquiry. The appellant was granted specialleave to Appeal by this Court and its appeal is. No.9/81. The 1strespondent has been granted leave to appeal by the Court of Appealbut has not filed any petition of appeal for want of sufficient timebecause we directed that 1st respondent's appeal be heard togetherwith S.C.9/81. The 1st respondent’s appeal bears No.21/82. This ordercovers both S.C.9/81 and S.C.21/82.
The reference to the Arbitrator (document ‘D’) containing thestatement of matters in dispute described 4he appellant as “the Agentfor Palmerston Tea Co. Ltd.” Admittedly the appellant was onlymanaging Queensland Estate for the 1st Respondent. It was a wellknown Agent for estate management in Sri Lanka and was at thattime managing other estates as weli.. Section 4(1) of the IndustrialDisputes Act empowers the Minister to refer to arbitration anindustrial dispute which in his opinion is a minor dispute. Section48 of the Act defines an industrial dispute thus-
“48.
“Industrial dispute” means any dispute or difference betweenan employer and a workman or between employers and workmen4>r between r,rr—':v.n ?r-j worketen connected with i!.-*
SC Shaw Wallace i Palmerston Tea Co. and Others (Samarakoon, C.J.)431
employment or non-employment, or the terms of employment,or with the conditions of labour, or the termination of theservices, or the reirfstatement' ih service, of any person; andfor the purpose of this definition ‘workmen’ includes a tradeunion consisting of workmen ;ir
We are here concerned with a Jdispute between employer andworkman.. "Employer” is defmed in section 48 as follows:-
"employer” means any person who employs or on whose bdhalfany other person, employs any workman and includes a bodyof employers (whether such body is a firm, company, corporationor trade union) and" any person who on behalf of any otherperson employs any workman;”
This definition deals with three types of persons-
Any person who employs a workman.
Any person on whose behalf any other person employs
any workman.
Any person who on behalf of any other person employs
any workman.
This definition must be read with the definition of “workman” insection 48 which states that a workman is “any person who hasentered into or works under a contract with an employer in anycapacity whether the contract is expressed or implied, oral or inwriting.” “The existence of., a contract with his employer is the sinequa non for identifying a workman”. Carson Cumberbatch & Co.Ltd Nandasena (1). The question for decision then is whetherthe appellant was an Agent which entered into a contractual obligationwith the petitioner and thereby made itself liable to the petitioner.Document ‘A’ which is relied on as the letter of appointment hasthe following heading:-
THE PALMERSTON TEA CO. LTD.
SHAW WALLACE & HEDGES LTD.
AGENTS & SECRETARIES.”
Paragraph 7 states that leave could be availed of by agreementwith the Agents & Secretaries. Paragraph 8 provides for terminationof service by three calendar months written notiee by either party
432Sri Lanka Law Reports(J982) 2 S.L.R.
or by payment of .three months salary and allowances, in lieu ofnotice “in the event .of termination being effected by the employer”.“Employer” in this para is not a reference to the appellant but isa reference to the 1st respondent. Para 10 reads thus:-
“10. The foregoing terms relate to your appointment by thisCompany on Queensland Estate. It will, however, beopen, to Shaw Wallace & Hedges Ltd., the Agents &Secretaries of this Company, in agreement with the Boardof Directors, to arrange at any time for you to betransferred for employment by another Company in thisAgency. In these circumstances, Clause 8 of the Agreementwill not be considered operative.”
It is not happily worded but it makes it abundantly clear that theappellant was acting as Agents & Secretaries of another Company..The words “this Company” refers to the 1st respondent. The petitionerwas aware and accepted the fact that the 1st respondent was theproprietor of Queensland Estate. In his application to the LabourTribunal filed on 9-9-71 he cited the, 1st respondent as one of theemployers meaning thereby that by the letter of appointment (DocumentA) the 1st respondent was under, a contractual obligation to him asa workman. Document ‘A’ is not a contract with the appellant butone with the 1st respondent. The appellant was not the employerof the petitioner and therefore has been wrongly made a party tothe reference by the Minister.
The next question to be decided is whether the operation of theLand Reform (Amendment) Law No.39 of 1975 absolved the employer,viz, 1st respondent from liability to the petitioner in respect of thetermination of his employment and rendered the reference by theMinister nugatory. Section42(B)(5)(a) of the Law 39 of 1975 reads thus:-
“42(B)(5)(a) Subject to the provisions of paragraph (b), whereany estate land is vested in the Commission, the rightsand liabilities of the former owner of such estate landunder any contract or agreement, express or implied, whichrelates to the puiposes of such estate land and whichsubsist on the day immediately prior to the date of suchvesting, and the other rights and liabilities of such owner. which relate to the running of such estate land and whichsubsist on such day, shall become the rights and liabilitiesof the Commission; and the amounts required to dischargeall such liabilities shall be deducted' from the amount of. compensation payable in respect of such estate land.”
$C Shaw Wallace v. Palmerston Tea Co. and Others (Samarakoon, C.J.)433
The liability to the petitioner was one which related to the runningof Queensland Estate and one which subsisted on the day immediatelyprior to the day Queensland Estate vested in the Land ReformCommission. This liability passed to the Land Reform Commission.“The word ‘become’ in its usual and proper acceptation imports achange of condition, that is the entering into a new state or condition”per Kindersley, V.C. in Archer vs Kelly (2) quoted by Eve, J. inWilliams Vs. Williams (3). Thus the liability of the 1st respondentceased in law on the date the Land Reform (Amendment) LawNo. 39 of 1975 came into operation and it became the sole liabilityof the Land Reform Commission. The continuance of th^ proceedingsin the present form has therefore become a futile exercise. In thisstate of affairs the Abitrator had no alternative but to stop proceedingwith the inquiry.
therefore allow the appeals of the appellant and the 1st respondentand set aside the order of the Court of Appeal allowing the writsprayed for. The appellant and 1st respondent will be entitled to costshere and in the Court of Appeal.
WAN ASUNDER A, J. – I agree.
SOZA, J. – I agree.
Appeal allowed.