Osment et Al v Penrose et Al

• Jurisdiction: British Virgin Islands
• Judge: Glasgow, P.
• Judgment Date: 01 January 1968
• Neutral Citation: VG 1968 HC 4
• Docket Number: Civil Appeal No. 1 of 1968
• Date: 01 January 1968
• Court: High Court (British Virgin Islands)

High Court

Glasgow, P.

Civil Appeal No. 1 of 1968

Osment et al

and

Penrose et al

C.E.L. Hewlett and E.A.C. Hewlett for Plaintiffs

McW. Todman for Defendants

Industrial Law - Contract of Service — Whether contract of service must be signed by both parties to be valid.

Facts: Evidence revealed that the defendant in negotiating a contract of service with the plaintiff placed the main clauses in a document entitled “Heads of agreement”. The defendant company signed the document but the plaintiff did not.

Held: Both parties were bound by the document since their conduct was guided by it. Plaintiff's claim for wrongful dismissal upheld.

1 The plaintiffs claim from the second Defendant damages for alleged wrongful dismissal on the 15 ^th August, 1967 and damages for alleged trespass to the Plaintiffs' goods on the 3 ^rd November, 1967. The second Plaintiff also claims damages for alleged assault and battery on her by the first Defendant on the 3 ^rd November, 1967.

2 The first Defendant is and was at all material times Managing Director of Dorp Hotels Limited, the second Defendant (hereinafter referred to as the Defendant Company). In October, 1966 when the first defendant was in London he met the first Plaintiff for the first time, and interviewed him in connection with the management of Long Bay Hotel, Tortola, the property of the Defendant Company. Later in the same month the first Defendant interviewed the first and second Plaintiffs in London in connection with the same subject. Two or three days later the first Plaintiff and the first Defendant had a telephone conversation in the course of which the first Plaintiff agreed to take the post and come to Tortola.

3 The first Defendant returned to Tortola and on the 24 ^th October, 1966 he addressed a letter to the first Plaintiff enclosing therewith a document headed “Heads of Agreement for Management Contract between Dorp Hotels Ltd. and Mr. & Mrs. Keith Wright-Osment.” The said document is hereinafter referred to as the “Heads of Agreement.” The first Plaintiff was requested by paragraph 2 of the said letter to sign the original of the “Heads of Agreement” and return it to the first Defendant “if all is well.”

4 The first Plaintiff did not sign the “Heads of Agreement”, nor did he return it to the first Defendant. However, he accepted the offer and both he and the second Plaintiff came to Tortola and worked at Long Bay Hotel on the basis that the “Heads of Agreement” applied to them. By paragraph 1 of their Defence the Defendants admit that the Plaintiffs were employed as hotel managers at the Long Bay Hotel with effect from 6 ^th November, 1966.

5 The “Heads of Agreement” is in the following terms:-

“Heads of Agreement” for Management Contract between Dorp Hotels Ltd., and Mr. & Mrs. Keith Wright-Osment.

• 1. Duration of contract 5 years from date of signatures.

• 2. Termination within 5 years period.

  • a. after first six months without obligation on either side;

  • b. by mutual agreement;

  • c. by Dorp. Hotels Ltd. at three months notice;

  • d. by management at three months notice not to be offered between the dates of September 1 ^st and January 1 ^st in any year and with forfeiture of six months profit bonus assessed for the six months prior to the termination date. (see 4).

• 3. Starting salary to be $420 U.S. per calendar month ($5040 per year) negotiable for increase after two years within 12% of basic and again after 31/2 within 10% of previous rate.

• 4. A 10% bonus to be given on the cash profit of Dorp Hotels Ltd. (e.g. after all expenses, maintenance etc. before depreciation dividends etc. This to be defined accurately by accounts) to be paid twice yearly after final accounts in April and in October.

• 5. Free accommodation and services in one of the hotel cottages for management and their family. Meals, local transport and use of hotel facilities free for management. Shop items, drinks and liquor and special foods for children where available from hotel at cost price to hotel.

• 6. Holidays during period when hotel is closed or at low occupation (usually May and October), to be arranged.

• 7. Management duties will include the running and organization of the Hotel as a whole. This includes reception, accommodation, restaurant, bar, shop, kitchen, and catering and all other guest facilities; office work including bookings, stock taking and accounts to monthly balance, day to day publicity where necessary, staff management, supervision and wages, ordering and purchasing.

(Sgd.) S.P. Penrose

Managing Director

Dorp Hotels Ltd.”

6 The “Heads of Agreement” contemplated that a written contract would be drawn up in due course between the Defendant, Company of the one part and the Plaintiffs of the other part, and that the duration of the contract would be five years from the date on which the parties signed the contract. No written contract was ever executed between the Defendant Company and the Plaintiffs and there is no evidence that the matter of the proposed written contract was ever raised again with either of the plaintiff.

7 On 15 ^th August, 1967 the first Plaintiff received a letter of the same date from the first Defendant. The letter was worded as follows:-

“Keith and Ella Wright-Osment.

After our discussion the other day it appears that you have not taken seriously my warnings, for again you have directly approached one of our hotel clients for your personal interest which are directly and quite clearly opposed to those of this Company.

In view of this breach, it is necessary for me to put formerly by you the terms of your notice.

You are given notice of termination of your employment together with notice to quit the accommodation and other facilities at present enjoyed by yourselves four weeks from today's date, i.e. September 12, 1967.

Without prejudice to this notice, you are offered a further two months' employment beyond this date on similar terms to those at present, this being subject to termination at a day's notice should we receive any further indication that you are not working for the best interests of the Company.

From today I shall require all letters going out under the hotel or Company's name to be signed by myself. I will also sign all cheques.

We have withdrawn your signature from the Company's bank accounts.

We shall not hesitate to enact my threat to take legal action in the event that you make any further effort to sabotage the business or good name of the hotel company.

(Sgd.) S.P. Penrose

Managing Director

Dorp Hotels Ltd.”

8 The Plaintiffs continued in the employment of the Defendant Company until 12 ^th November, 1967. However, on 9 ^th November, 1967 they vacated the hotel cottage in which they had been living, and went to reside with a friend at Little Apple Bay who gave them free accommodation. The first Plaintiff said that they left the said cottage when they did because he...