The High Court granted interlocutory relief to the chief executive of the National Institution of Bioprocessing Research and Training Limited after finding that the evidence presented showed a strong case that his employment had not been validly terminated.
In a judgment delivered on 14 November 2006, Miss Justice Laffoy ordered that the company not remove him from the CEO post, dismiss him or give effect to a purported termination or resignation. The company must continue paying his salary and other emoluments as they fall due, and may not appoint someone else as CEO. The court did not order his restoration to the role, which it considered unnecessary.
The proceedings began with a plenary summons on 24 October 2006. The CEO sought interim injunctions after a board meeting on 12 October. The company’s chairman said in an affidavit that the board had unanimously decided to terminate the CEO’s employment after losing confidence in his management. The chairman said the CEO had agreed to resign in return for a payment equivalent to 12 months’ salary. The CEO, through his solicitors, denied agreeing to resign or settle any claim.
The company later said it considered the employment terminated with effect from 12 October and would pay six months’ salary in lieu of notice under the service agreement. The CEO’s contract provided for a five-year term, termination on at least six months’ written notice, and immediate termination in specified circumstances.
The judge did not decide the underlying employment dispute. She noted that the board meeting notice had not identified termination as business to be transacted, and the company had not produced minutes of the board’s decision. On the evidence before her, it appeared more probable that the decision had not been validly made under the company’s articles of association.
The judge also found that the CEO had received no prior written notice of termination effective from 12 October. The company’s solicitor’s letter of 18 October could not remedy that defect retrospectively. The judge said that, on the company’s own case, the employment had not been terminated in accordance with the contractual provision it relied on.
The CEO also argued that he had been denied fair procedures over management issues. The company said the dismissal was not for misconduct. The judge said that explanation did not answer the claim that the CEO should have had an opportunity to put forward his view, but she did not make a final finding on that issue. She likewise found a fair issue to be tried over alleged representations about the five-year term, but not a strong enough case at this stage for mandatory relief on that point.
The orders were conditional on the CEO providing the usual undertaking as to damages. The company may give written notice under the agreement requiring him not to work pending trial; if it does, he may not access its premises without written permission. The court said the case should proceed expeditiously.