This reference concerned the alleged constructive dismissal of Mohd Yusoff Mahmood ( " the claimant " ) by Gula Padang Terap Berhad ( " the company " ) on 29 September 2000.

The company owns and manages a sugar cane plantation as well as a cane sugar factory. The claimant commenced his employment with the company on 2 July 1994 as its general manager. About this time there was a change of shareholders and an ensuing reorganisation of the company which resulted in the claimant's redesignation as general manager (plantation). For a short duration of about forty-three days beginning 23 March 1998 the claimant acted as the company's group general manager (AGGM) in place of one Mohd Amin Haji Mohamad (Amin) who was on leave to perform the Haj. In April 1999, the claimant was appointed as the company's executive plantation technical advisor, the position he continued holding until he left the company on
29 September 1999.

A brief chronology of the events preceding the claimant's departure from the company is as follows:

28th July 1999 ... the claimant received a show cause letter.

31st July 1999 ... he replied.

29th August 1999 ... he was suspended with half salary.

11th September 1999 ... a domestic inquiry was held to hear
three charges against him. 28th September
1999 ... the company informed him that he
had been found guilty on two out of the
three charges, and demoted him to the
position of agricultural advisor.

29th September 1999 ... he tendered his letter of resignation, claiming
constructive dismissal.

4th October 1999 ... the company replied by letter, denying the
alleged constructive dismissal.

The charges against the claimant were as follows:

1. Bahawa kamu, Mohd. Yusuff Mahmood bernombor kerja MR2190, pada
26/3/98, di antara jam 8.15 pagi hingga 4.30 petang di Pejabat Gula Padang Terap Bhd telah meluluskan satu 'variation order' yang berjumlah RM320,197.61 tanpa melalui proses 'tender' yang telah dipraktikkan oleh Syarikat selama ini. Hasil daripada tindakan anda itu, anda boleh dianggap telah melakukan kecuaian, menyalahgunakan kuasa dan kedudukan anda sehingga memaksa Syarikat memperuntukan kos tambahan melebihi RM300,000.00 yang mana ianya menambah kerugian kepada kewangan Syarikat.

2. Bahawa kamu, Mohd. Yusuff Mahmood bernombor kerja MR2190 pada
31/3/98, antara jam 8.15 pagi hingga 4.30 petang di Pejabat Gula Padang Terap Bhd telah meluluskan satu 'variation order' yang berjumlah RM117,001.41 tanpa melalui proses 'tender' yang telah dipraktikkan oleh Syarikat selama ini yang mana hasil daripada tindakan anda ini, boleh dianggap telah melakukan kecuaian menyalahgunakan kedudukan anda sehingga memaksa Syarikat memperuntukan kos tambahan yang menambah kerugian kepada kewangan Syarikat.

3. Bahawa kamu, Mohd. Yusuff Mahmood bernombor kerja MR2190, telah menjadikan 'precedence' kepada Syarikat hasil daripada tindakan anda yang telah meluluskan 'variation order' pada 26/3/98 dan 31/3/98 yang menyebabkan Syarikat terpaksa menokok tambahkan kos tambahan sebanyak RM368,273.93 dan tindakan ini boleh dianggap kecuaian kerana tidak melalui proses tender yang dipraktikkan dan mendatangkan tambahan kerugian kepada Syarikat.

Shortly restated, the first charge accused the claimant that on 26 March 1998 he had approved a variation order totalling RM320,197.61 without going through the tender process practised by the company. The second charge was the same save for the date ie, 31 March 1998 and the amount ie, RM117,001.41. Of both these charges the claimant had been found guilty by the domestic inquiry. The third charge accused the claimant of having set a precedent by his said acts of approving the variation orders and causing the company to bear additional costs which could be considered acts of negligence. Of this third charge, the claimant was found not guilty by the domestic inquiry.

The said variation orders pertained to fertilisers previously contracted to be purchased from a supplier by the name of Agronexus Sdn. B