Duress or Coercion in Contract of Employment must be Challenged Timeously

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His Lordship, Hon. Justice O. O. Arowosegbe of the National Industrial Court of Nigeria, Sitting in Owerri, Imo State on Wednesday 8th October 2018 in a judgment dismissed in its entirety the suit filed by VALENTINE OGU (claimant) against KEYSTONE BANK LTD –defendant challenging his purported resignation. The Court held that duress or coercion in contract must be challenged timeously.

This suit commenced by way of Complaint on 11th March 2016. The claimant sought against defendant among others; A Declaration that the purported resignation by the claimant from the defendant is involuntary, void and of no effect; A Declaration that a resignation by the claimant from the defendant will only take effect from the date of compliance with the defendant’s Human Capital Policies And Procedure (HCP) Manual Revised 2013; A Declaration that the claimant is entitled to be paid all his salaries and entitlements from the defendant until the defendant complies with its Human Capital Policies And Procedure (HCP) Manual Revised 2013 as it affects the claimant in the sum mutually calculated and computed between the claimant and the defendant on the basis of the claimant’s annual total package of N12,511,542.73 (Twelve Million, Five Hundred and Eleven Thousand, Five Hundred and Forty-Two Naira, Seventy-Three Kobo). 

The case of the claimant as made out in his Statement of Facts is that he was a staff of the defendant until the events that led to this suit, and that, throughout his employment with the defendant; he was never queried or reprimanded. It is also the claimant’s case that disengagement in his employment with the defendant was governed by written policy and that he was forced to resign against the provisions of this written policy, and that, his resignation could only take effect from the date of compliance with the applicable terms of the HCP.

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On the other hand, the defence, as contained in the Statement of Defence, is that the claimant voluntarily resigned his appointment and was never forced or unduly influenced to do so. The defendant also made a case that the claimant is indebted to it having taken a loan of N2,200,000.00 on 25th September 2013 while still in the employment of the defendant, which had not been repaid till date and that the claimant was owing it another N5,659,033.79 as the cost of the status car and other exposures as at February 2016 before the sudden resignation of the claimant.

The defendant also stated that the claimant, contrary to his assertion, had failed to comply with the HCP by refusing to make himself available to it after the sudden resignation, despite repeated requests and that, the pension due to the claimant had been remitted to his Pension Funds Administrator to the claimant’s knowledge. The defendant claimed that, it did not cause any hardship to the claimant as a result of his voluntary resignation. The defendant also claimed one-month salary in lieu of notice against the claimant.

Counsel argued that arising from this, the onus is on the claimant to prove the involuntariness of his resignation and that; the starting point was the pleading of the claimant and the evidence led. The learned counsel submitted further that, the allegation of involuntary resignation is an afterthought when viewed from the background that the resignation took place on 12th February 2014 and this suit was instituted in March 2016, which is a time lag of two years.

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The learned counsel argued that, the signature of the claimant on the letter of resignation, which signature has not been disputed, proved the voluntariness of his resignation. The learned counsel argued that the only inference to be drawn from the claimant’s refusal to make himself available to the defendant in defiance of the HCP is that he was trying to avoid the payment of his debts to the defendant and the surrender of the car.

The learned counsel argued further that, under cross-examination, confirmed that no superior officer signed off the letter of resignation and that, this translated to the fact that, the defendant never acknowledged it.. The learned counsel argued that, by this, the claimant had put credible evidence that the purported resignation is null and void.

The learned counsel argued that, since the status car was not a loan, the claimant was entitled to retain it and pay the depreciated value. The learned counsel submitted that thus, the claimant proved that it was not owing the defendant the sum of N5,659,033.79. The learned counsel submitted further that, it was even the duty of the defendant to prove how this sum came to be owed since he who asserts must prove.

After carefully considered all the processes filed, the evidence led and the submissions of the learned Counsel from both sides. The Court presided by Hon. Justice O. O. Arowosegbe expressed thus;

“For reasons best known to both parties, the Court is kept in the dark as to what gave rise to the alleged threat. I am not therefore convinced that an adult could be coerced simply by mere oral threat of being sacked to sign a letter of resignation and even if this is so, I found it difficult to fathom why the claimant took two years to realize that he was forced/coerced to sign the said letter of resignation.

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“It is undoubtedly the law that duress or coercion in contract must be challenged timeously otherwise, the victim would be held to have ratified the contract induced by the said duress/coercion or undue influence.

“It is curious that the claimant did not explain what prevented him for the two years from challenging his alleged forcible resignation. This is a serious gaping hole.

“I, therefore, hold that the claim of coercion/duress/undue influence fails and that, the claimant is therefore not entitled to all the reliefs claimed. The two issues are therefore resolved against the claimant and in favour of the defendant.

“The suit is therefore dismissed in its entirety.” Justice Arowosegbe Ruled.

His Lordship also dismissed counter-claim in their entirety as an abuse of process.

Read full Judgment here

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