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FEDERAL COURT KUALA LUMPUR
DR JAMES ALFRED (SABAH) – Appellant
Versus
KOPERASI SERBAGUNA SANYA BHD (SABAH) & ANOR – Respondent
[Civil Appeal No: 04-2-2000(W)]
[1] This appeal concerns a matter of principle. More specifically, it relates to the proper principle to be applied in assessing quantum of backwages awarded by the Industrial Court, the second respondent.
[2] The appellant, Dr James Alfred, was appointed as the general manager of the first respondent, Koperasi Serbaguna Sanya Bhd, Sabah on 1 November 1984 with a salary of RM8,000 a month. On 15 May 1986, the first respondent levelled charges of misconduct against the appellant alleging abuse of authority. The appellant replied to the charges. It made no difference because on 1 June 1986, he was dismissed. He then lodged a complaint to the Minister of Human Resources. On 19 January 1988, the Minister referred the case to the Industrial Court. The Industrial Court held that the appellant was dismissed without just cause or excuse. It awarded him backwages and compensation in lieu of reinstatement as follows:
1(a) arrears of salary (backwages) from 1 June 1986 to 11 October 1995 (the last date the matter was heard in the Industrial Court);
(b) compensation in lieu of reinstatement of one month's salary for each year of service from 1 November 1984 to 11 October 1995; and
(c) 20 days wages in lieu of unutilised leave.
[3] The first respondent applied for certiorari in the High Court. This was rejected. It then appealed to the Court of Appeal. The appeal was dismissed except for the award on backwages. The Court of Appeal was of the view that the Industrial Court, in assessing the award for backwages, should have taken into account the fact that the appellant had found other employment in the period after his dismissal by the respondent. In the circumstances, it ordered the matter to be remitted to the Industrial Court for fresh assessment on the award for backwages. The appellant, dissatisfied with that decision, filed a motion in the Federal Court seeking leave to appeal. Leave was granted on the following question:
Whether the Industrial Court is bound to deduct or set off from backwages, wages and remuneration earned by the dismissed workman from other employment from the date of dismissal to date of the award.
[4] Now, it is well settled that awards of Industrial Courts are subject to judicial review on account of jurisdictional errors. In the context of this case, we find the following passage from the speech of Lord Reid in Anisminic Ltd v. Foreign Compensation Commission [1969] 2 AC 147 merits particular citation. It reads:
It has sometimes been said that it is only where a Tribunal acts without jurisdiction that its decision is a nullity... But there are many cases where, although the Tribunal has jurisdiction to enter on the inquiry, it has done or failed to do something in the course of the inquiry which is of such a nature that its decision is a nullity. It may have given its decision in bad faith. It may have made a decision which it has no power to make. It may have failed in the course of the inquiry to comply with the requirement of natural justice.... It may have refused to take into account something which it was required to take into account or it may have based its decision on some matter which, under the provisions setting it up, it had no right to take into account. I do not intend this list to be exhaustive.
[5] We take the view that the quantum of backwages is a matter within the discretion of the Industrial Court. That discretion is, however, not unfettered. It has to be exercised according to law. In this connection, s 30(5) of the Industrial Relations Act 1967, is significant, and it reads:
The Court shall act according to equity, good conscience and the substantial merit of the case without regard to technicalities and legal form.
[6] It seems clear therefore that the Court has to act in accordance with equity in the exercise of its discretion. Here, we may also add that we find sufficient merit in the proposition stated in vol 2 of the 4th edn of the Law of Industrial Disputes by Ma
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