Carter v Royal Bank of Canada

• Jurisdiction: Antigua and Barbuda
• Court: Industrial Court (Antigua)
• Judge: Sampson, J.
• Judgment Date: 10 January 1977
• Date: 10 January 1977

Industrial Court

Sampson, J. (Hearing Officer)

Carter

and

Royal Bank of Canada

Appearances:

Donald Halstead M.P. for the worker

Mr. William Archibald, Barrister and Solicitor, Phillips, Phillips & Archibald for the employer

Industrial law - Unfair dismissal — Following a letter of suspension the employee was dismissed — Reason given by the employer was that the worker was “engaged in irregular banking transactions commonly known as Kiting” — Counsel for the worker submitted that the allegation of kiting had not been proved — Decision that the charges levied against the worker had been determined to be well — founded — Worker was justifiably dismissed.

Case for the Worker:

Case for the Employer:

1

The case for the employer was presented mainly through the testimony of witnesses, this testimony follows.

Testimony of Witnesses:

Mr. Vaughn Blanchard.

1

This witness testified that he had worked with the Royal Bank of Canada for 7 years, and had been Officer in charge of Deposit Business for 5 months, having succeeded a Miss Murraine. ii. He knew the worker involved, and had worked with her for 1 month and a few weeks. She was Savings Checking Officer, and had no other role. iii. Although he was her immediate superior, she did not act Officer in charge of Deposit Business in his absence. If problems arose, these could be referred to the Assistant Manager, Messrs.. Beach and Warburton, who performed the functions of Manager in Mr. Fisher's absence. iv. The witness stated that all deposit accounts were under his jurisdiction, and that although he generally dealt directly with these accounts, he dealt specifically with the worker's savings and personal checking account during June 1976. This was as a result of a report to him by the Proof Officer to the effect that “something fishy” was going on in connection with the operation of the worker's account. He reported this to Mr. Beach and was instructed by him to carry out an investigation into the worker's accounts. He pulled out of the file all old vouchers pertaining to these accounts, and found that almost every tine one of the worker's cheques came in for payment, a deposit would be made to her account on the same day. The cheques in question would come in with the clearings from the other banks on the previous afternoon, and the deposits would be made the following morning. The witness stated that he pulled out all the debits with corresponding credits, and passed them to Mr. Beach. v. The witness also stated that he left himself had been a Savings Checkings Officer during 1971 and 1972, and remembered the responsibilities of such an officer to be the checking of debits and credits to see that signatures, names, numbers and dates were correct and corresponded, one with another. There was also a higher level of checking, in which the vouchers, especially debit vouchers, were inspected for flow of money. It was possible, the witness said, for the rules governing the checking function to be broken in such a way as to cover up undesirable operations. vi. In response to questioning by Mr. Halstead, the witness stated that his experience in the field entitled him to call himself a “Banker”. He also stated that he handled deposit business, which excluded loan accounts and the payment of bill by cheque, which latter transaction was under the purview of the Proof Officer. He was, however, required to see all accounts which were handled in; any particular day, and did in fact see more than 50% of the accounts. Accounts were not overdrawn by permission or approval of the witness. If an account were overdrawn, and this was spotted, the matter was referred to the Assistant Manager loans, who may or may not give approval for the cheque to be honoured. vii. The witness was familiar with the workers accounts, and knew that the worker made deposits to her account at such a time as to ensure that the account was in funds when cheques which had come in the clearings the previous afternoon were posted. The worker could, however, he said to have used the bank's money, because credit was given immediately when cheques carne in the clearings. viii. The witness had not personally experiences a similar situation with a customer but had known employees to overdraw their accounts. Such matters were referred to an Assistant Manager, who would decide what course of action to take. Cheques were often bounced, but no employees had been dismissed or suspended for overwriting their accounts while he had been in Antigua. This was the first time to his knowledge that an employee had been disciplined in this manner. ix. At the time the Proof Officer made her report the worker had not yet gone on vacation. Investigations were being made from the Wednesday before the worker proceeded on vacation, but she had not been informed that her accounts were being investigated. The investigations were carried out on the instructions of Mr. Beach. The witness could not say for sure that the Manager had been informed, but did not believe he, had been. x. In connection with the word “kiting” the witness said that he knew of the word from his experience, but that the word was not defined in the rules, Referring however, to the bank's Rule 15 (F), which said that it should never be necessary to transfer funds from another account to cover a cheque presented for payment, the witness stated that to the best of his knowledge, this meant kiting. ix. Further questions elicited statements to the effect that although the worker's account appeared to be in order after the debits and credits had been posted; the accounts were in his opinion operated in an unethical manner since, by issuing cheques on an account when there was no money in it, the worker was using one of the bank's systems to make credit available to someone else and using some one else's account to give herself credit. There was evidence of a 2-way traffic in credit. Deposits were made to the worker's account by cheque; and in cash. The witness tried to trace these deposits, and managed to trace some of them to the First Pennsylvania Bank. Only the very last cheque, which he had photocopied, was traced to the account of one C. Bedminster. However, no other bank was involved. The witness considered that something was wrong with this operation. He had never seen an employee operate an account in that way, and felt that the number of times the operation was repeated in this particular case was far too frequent. xii. In connection with the bank's rules, the witness stated that he had never been given a personal copy of the rules, but that the rulebook was accessible to employees. Further, new or amended rules were circulated throughout the office as they came from Head Office. xiii. Returning under questioning to the final transaction involving deposits to the worker's account, which he had investigated, the witness stated that a cheque had been issued by the worker on the 8th of June 1976 to a party whose name he could not remember. This cheque was returned in the clearings from the First Pennsylvania Bank. The worker made a deposit to her account in the form of a cheque issued by C. Bedminister on First Pennsylvania Bank. Both the worker's cheque and Bedminister's cheque were posted to her account on the same day. The witness, however, could not remember the situation of the worker's account at the time her cheque was written.

Mr. K. A. D. Fisher

1

This witness stated that he had known the worker since the beginning of this assignment to Antigua in July 1973, and had been responsible for her appointment to the position of Savings Checking Officer in November 1975. In this position the worker was assistant to the Officer in charge of Deposit Business, and was subordinate to him. The witness was generally familiar with the functions of the Swings Checking Officer, which he knew to be the verification of signatures, totals and dates on debits and credits, and involved close familiarity with the rules governing the checking function. These rules were written, available to all staff, and were both general and specific, and in certain cases had to be referred to by the Savings Checking Officer when performing her functions. ii. The witness could not say how long or in what manner the worker had been trained in the functions of her position, but had neither heard nor seen anything derogatory of her performance prior to the reports which led to her dismissal. He had seen assessments of her past performance, and was both pleased and satisfied to note that she was making normal progress in her career. He had not known the worker to complain that she did not understand her job. The position of Savings Checking Officer could be termed an intermediary position, the next step for the worker being that of becoming part of the Management team. iii. In June 1976 it was reported by Mr. Vaughn Blanchard, Officer i/c Deposit Business, that the worker had been involved in kiting operations. At the time of the report the worker was on vacation, and would shortly proceed to the United States. She was contacted, and asked to come to the office, where discussions took place. The worker told him that she had not realised that he was being used by Bedminister to kite cheques. She said that on occasion Bedminister asked her for funds to purchase United States Currency for a friend who was travelling to America. He would later give her a cheque drawn on First Pennsylvania Bank, saying that his friend had reimbursed him. This sometimes happened within a matter of hours. The worker stated that this had begun in May 1976. The witness was inclined to believe this, and recommended to his principals that under the circumstances, considering that the worker had been unwittingly used, the matter should be allowed to rest. This action was taken on the premise that what the worker had said was the truth. Before a reply could be received from...