North South Yacht Vacations Ltd v Terry Turl; Susan Turl

JurisdictionBritish Virgin Islands
JudgeJoseph-Olivetti, J.
Judgment Date31 May 2007
CourtHigh Court (British Virgin Islands)
Docket NumberBVIHCV2000/0088
Date31 May 2007

IN THE HIGH COURT OF JUSTICE

BVIHCV2000/0088

BETWEEN
North South Yacht Vacations Limited
Claimant
and
Terry Turl
Susan Turl
Defendant
Terry Turl
Susan Turl
Claimant
and
North South Yacht Vacations Limited
Brian Rose
Defendant
Appearances:

Mr. John Carrington and Ms. Mishka Jacobs of Mc W. Todman & Co. for the Claimant and Mr. Rose

Mr. Sydney Bennett Q.C. and Ms. Michelle Worrell of J.S. Archibald & Co. for the First Defendant

(Civil — oral contract of service — claim by employer for damages for breach of contract-whether employee in breach of implied term that he would serve his employer in good faith—whether employee using employer's property for his personal benefit

Counterclaim by employee for damages for wrongful dismissal — employee claiming that he was constructively dismissed — whether employer in breach of implied term that he would not act so as to damage the trust and confidence in the employer/employee relationship Counterclaim by defendant for damages for breach of share sale and purchase agreement—whether defendant had paid the full purchase price and so had his obligations under the contract

Counterclaim by defendant for damages for defamation—whether claim made out—whether plea of justification established)

Joseph-Olivetti, J.
1

Absentee ownership and its accompanying pitfalls did not, as this case illustrates, completely cease with the abolition of slavery in the British West Indies in 1836 and the consequential decline of the great sugar plantations. Mr. Terry Turl, a Canadian citizen was the manager of North South Yacht Vacations Ltd. (‘North South’) a Canadian owned yacht charter company operating in the British Virgin Islands (‘the BVI’). He worked in that capacity for nigh on ten years and was given a virtually free hand in managing North South's affairs. In July 2000 he resigned from his employment with North South and now North South is seeking damages for breach of contract, conversion, an account and payment of monies wrongfully withheld or used by Mr. Turl to meet his personal expenses and an injunction against disclosure of confidential information from North South's books and records and costs. Mr. Turl in turn denies the claim and has counterclaimed against North South for damages for constructive dismissal and against its managing director, Mr. Rose for damages for breach of contract for a share sale and purchase agreement and for defamation.

The History of the Proceedings
2

This claim was filed in 2000 but its progress through the court was unusually slow being dogged with difficulties and a word about that is apposite. First, inevitable delay occurred because Criminal proceedings which were unsuccessful had been instituted against Mr. Turl for matters connected with his employment with North South1 and civil proceedings had also been taken against him by North South in Canada which impacted on these proceedings.

3

Eventually, this trial commenced on 17th July 2006 but on the second day counsel for Mr. Turl became indisposed and the matter was adjourned. However, that next fixture was subsequently cancelled as Mr. Rose, the chief witness for North South, had to have medical attention in Canada. Setting fixtures was further complicated by the fact that the main witness for each party resided in Canada. Finally, the matter was fixed for continuation on 6th March 2007. Some good did come of the delays however as, on that

day, Mrs. Susan Turl, Mr. Turl's wife, who was originally a defendant to the action and North South settled the claims against her and a consent judgment (‘the Consent Judgment’) was entered. Thereafter, the trial continued only against Mr. Turl and was duly completed. Both counsel relied on written submissions and the court is grateful for their well researched and full analysis of both the evidence and the law.
The Witnesses
4

The Court heard evidence on behalf of North South and Mr. Rose from Mr. Brian Rose, Mr. Chandi Singh, its current general manager and Mr. Nallie Layne and from Mr. Terry Turl for the Defence. In addition, North South relied on four bundles of documents and Mr. Turl on 2 bundles and two additional documents (TT1 and TT2). All this documentary evidence was entered by consent.

Background
5

The undisputed evidence is that North South recruited the Turls from Canada as a team. Mr. Brian Rose, who resides in Canada, conducted the negotiations on behalf of North South. Mr. Turl was hired as general manager and Mrs. Turl as its clerical officer both from 1st October 1989.

6

Mrs. Turl left her employment in June 2000 without giving notice and Mr. Turl resigned in July 2000 likewise without giving notice. It must be remarked that during the period of their employment Mr. and Mrs. Turl established their home in the BVI and became the proud parents of two boys who were aged 10 and 6 at the time the family departed from these shores.

7

Mr. Turl's contract of service like Mrs. Turl's with which we are no longer concerned was an oral one and apart from Mr. Turl's proposals contained in a letter dated 1st October 1989, there is no written evidence of the terms and conditions of this contract. The relevant terms therefore fall to be determined from the evidence and in addition will contain such terms as may be implied by law.

8

During the period of his employment Mr. Turl was given free rein over the conduct of North South's business in the BVI and was one of the signatories on North South's BVI bank account in that cheques could be negotiated on his signature alone.

9

Mr. Turl was required to and did submit to North South through Mr. Rose monthly statements of accounts in accordance with a form provided to him by Mr. Rose for that purpose. The nature of the summary was as its name implied, summary in nature, and no in-depth breakdown of expenditure and income was supplied and North South was apparently satisfied with that as long as the relationship was cordial as it did not ask for any.

10

During a short period ending in or about 1996 an accountant was on board but he was not a signatory on the bank account and was at all times subject to the direction of Mr. Turl as general manager.

11

In or about 1992 Mr. Rose and Mr. Turl entered into an agreement whereby Mr. Rose agreed to sell 10% of North South's shares to Mr. Turl. This is part of the counterclaim and I will refer to it at the appropriate time in more detail.

12

Both Mr. and Mrs. Turl left the employment of North South under a cloud as apparently a dispute arose between Mr. Turl and Mr. Rose over negotiations with Mr. Rose to purchase the entire shares in North South. Mr. Turl alleges that the resulting breakdown in the relationship gave rise to his counterclaim for damages for constructive dismissal. This too will be addressed more fully when I come to consider the counterclaim.

13

After the Turls' precipitate departure Mr. Rose came to the BVI and commenced investigations into North South's affairs as conducted by Mr. Turl and found much amiss and eventually brought this claim. Clearly, both Mr. and Mrs. Turl also considered that they had been shoddily treated by North South and hence they made the counterclaim.

The Issues
14

The main issues arising on the claim and counterclaim are:—(1) whether Mr. Turl breached his contract of service, (2) whether Mr. Rose breached the share sale and purchase agreement, (3) whether North South constructively dismissed Mr. Turl and (4) whether Mr. Rose defamed Mr. Turl after he left North South's employment.

Issue 1—Did Mr. Turl breach his contract of service?
15

Let me say at the outset that this case is concerned mainly with factual issues and that consequentially the credibility of the witnesses was of paramount importance as the wealth of documents produced spoke in the main to expenses which North South alleged was improperly attributed to it by Mr. Turl when in fact they related to his personal expenditure.

16

My general impression of Mr. Turl having observed his demeanour in the witness box and weighed his responses on cross-examination was unfavourable to say the least and I preferred the evidence of North South's witnesses to his as I found them eminently more credible than him. Mr. Turl's testimony was burdened with prevarication and loquacity and he did not hesitate to change his answers at times. He seemingly could not give a straight answer to even the simplest of questions even allowing for the time that had elapsed since the occurrence of events and the trial. His answers were far from satisfactory and his explanations were in the main incredible.2 In short then I prefer the evidence of North South's witnesses to that of Mr. Turl's.

17

The main contractual terms which were breached says North South is the implied term to account for monies and to hand over monies due to the employer and the implied term that an employee would serve in good faith. There is no dispute that such a latter term is implied by law in every contract of service.3 See Hevac Limited v. Park Royal Scientific Instruments Ltd. et al4 which establishes that such a term is implied by law in a contract of service and that it requires that an employee should not act in any way that would damage the interests of his employer.

18

Now to the evidence. North South pleaded several specific instances of breach and Mr. Rose in evidence gave details of alleged instances of breaches including some which were not specifically pleaded.

19

Mr. Bennett Q.C., for Mr. Turl took issue with this and urged that this evidence offended against CPR2000 R. 8.7 which requires a claimant to set out in his statement of case“a

Statement of all the facts upon which it relies” and should be disregarded. Learned Counsel identified and set out in full the offending statements in paragraph 2 of his submissions. (He had raised this issue at all relevant times throughout the trial but the court, mindful...

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