The case of sacked New Building Society (NBS) Manager Maurice Arjoon continued on Tuesday before the Caribbean Court of Justice (CCJ), where both the appeal and cross-appeal of the judgement against NBS were heard and the court has reserved its ruling on the case.
Arjoon, who was dismissed from his position as Chief Executive Officer (CEO) of NBS in 2007, appealed the Court of Appeal’s decision last year to lower his pension benefits from $59 Million to $18.8 Million.
NBS has also cross-appealed and Senior Counsel Stephen Fraser, who appeared on behalf of NBS, argued before the CCJ that Arjoon was indeed properly dismissed. In the event that the CCJ upheld this view, Fraser wanted the court to also uphold that NBS had the discretion to determine whether to make pension payments to Arjoon.
The Senior Counsel asked the court to consider the letters of termination, which show that Arjoon refused to participate in a meeting probing his conduct and imposed conditions on his employer.
Senior Counsel Edward Lukhoo meanwhile appeared for Arjoon. Lukhoo argued that the evidence in the case, including the audit report, as well as previous rulings make the case that Arjoon committed no wrongdoing.
It was Lukhoo’s contention that Arjoon’s conduct did not justify his dismissal. Meanwhile, the CCJ committed to reviewing the facts of the case and reserved its ruling for an unannounced date.
Arjoon was fired from his position in connection with a Magistrate’s Court matter wherein he, and the mortgage lending institution’s former Operations and Assistant Mortgage Managers were accused of conspiracy to defraud the NBS of nearly $70 million. The matter was eventually dismissed, and Arjoon and the others took the financial institution to court in 2011.
The NBS had contended that an unauthorised withdrawal of nearly $70 million had been made from an account that its client Bibi Shamina Khan held. The NBS’s issue with the withdrawal was that it was made through a Power of Attorney, and the company had implicated Arjoon for misconduct.
An investigation had claimed that the fraud was committed in 2006, and the three men were all fired the next year after it had allegedly been determined that they were at fault for dereliction of duty, negligence, and/or serious/ gross misconduct.
Among the grounds of appeal advanced by NBS were that the over-riding defaults in Arjoon’s dealing with the withdrawals from Khan’s account were not taken into account by Justice Reynolds nor did he consider that the person making the withdrawals from the account was not duly and properly authorized to do so, thereby causing NBS a loss of over $79 million; and that his ruling was erroneous, in that, the pension could not be awarded together with severance and other benefits when an employee is terminated or dismissed.
In affirming the trial Judge’s decision, the Court of Appeal held that NBS failed to show that the transaction in question was directly related to the employment relationship. While there were three transactions directly related to the employment relationship, none of them showed that Arjoon “by himself” was “directly responsible” for the incident.
The Court of Appeal, therefore, concluded that Arjoon discharged his functions by the regulations and systems in place and that the omissions, whatever they were, did not amount to serious misconduct. In the end, the appeal court only allowed NBS’s appeal on the issue of Arjoon’s pension entitlement and dismissed all of its other grounds of appeal.
As a result, his pension benefits were significantly reduced from $59,033,281 to $18, 817,432—which is subjected to any indebtedness to NBS. In computing the new sum, the Chancellor explained that the court considered the relevant provisions of the Termination of Employment and Severance Pay Act. The NBS was ordered to pay Arjoon $800,000 in court costs.
