Commercial Law Updates

 On 28 October 2022, the Supreme Court of Fiji confirmed that Total (Fiji) Limited (TOTAL) is liable under Fiji law as a polluter. (CIVIL PETITION NO. CBV 0007 of 2020) (Supreme Court Judgment)

Fiji’s Supreme Court Judges were unanimous in their opinion that TOTAL had been negligent and caused a “pollution incident”. The Supreme Court Judgment upheld the Fiji Court of Appeal’s unanimous Judgment (CIVIL APPEAL NO. ABU 90 OF 2018) that found TOTAL had caused a pollution incident as defined by section 50 of the Environment Management Act, 2005. 

Together, Fiji’s Court of Appeal and Supreme Court Judgments against TOTAL provide significant environmental law jurisprudence for Fiji and demonstrate that the “polluter pays principle” is established in Fiji common law. Amongst other things, the Supreme Court Judgment rejected TOTAL’s interpretation of section 50 of the Environment Management Act, and directed that damages be assessed against TOTAL under 5 separate heads of damages. 

TOTAL did not accept the higher Court Judgments and as a dissatisfied litigant, chose to file an application to challenge the Supreme Court Judgment pursuant to section 98(7) of the Constitution of Fiji. TOTAL’s challenge to the Supreme Court Judgment may be unprecedented in the context of civil litigation in Fiji. 

TOTAL’s challenge was heard by Fiji’s Supreme Court on 13 April 2023, and on 5 April 2024 the Supreme Court by unanimous decision rejected TOTAL’s challenge.

This article provides a summary of the exceptional circumstances under which the final judgment of Fiji’s highest court, the Supreme Court, may be challenged. Any challenge to the Supreme Court must be considered with extreme caution as the dissatisfied litigant challenges the public interest that litigation should reach a final conclusion.

On 26 January 2024, and following broad consultation, Fiji’s Department of Energy launched Fiji National Energy Policy 2023-2034 (NEP) which sets out an ambitious implementation plan under the leadership and coordination of the Department of Energy to meet Fiji’s international climate change targets and align with Sustainable Development Goal 7 (SDG 7).

The Fiji government's response to the public health crisis posed by Covid-19 has been swift, and remarkable. At the time of writing this response based on WHO advice has reduced the known cases of Covid 19 in Fiji to 3 active cases bringing the number down from a peak of 18. This is a notable achievement, but Fiji's success has come with a steep economic cost.  

In our firm's guidance to employers on 18 March 2020 (available here) published just before Fiji confirmed its first Covid-19 case, we noted that employers and employees may find solutions together to respond to the unprecedented situation. This is based on the premise that employers and employees have the option to work together in good faith to find compromises to employment relationships within the law. The unfortunate reality is that if an employer cannot afford meet wage obligations then employment will end for one reason or another. A little over 2 months after Fiji's first Covid-19 case many of us are aware of a number of Fiji employers who have had no choice but to terminate employment contracts, follow redundancy processes or seek to reduce wages. In exercising all of these options the employer still has the duty to act in good faith. 

On 28 May 2020, the Government of Fiji introduced a Bill before the Parliament of Fiji, Bill No. 12 of 2020, that has passed into law as the Employment Relations (Amendment) Act 2020 (“Amendment”). The Amendment has changed Fiji's employment law with the aim of addressing difficulties faced by businesses due to COVID-19. The intention behind the Bill was explained in the explanatory note to the Bill as “to provide for a more realistic work environment which enables the sustainability of jobs and businesses, and to clarify the meaning of “an act of God” in the Act during the COVID-19 period”.

This commercial law update outlines some of the major changes that this Amendment has made to the law, and how it relates to other sections of the Employment Relations Act 2007 (“ERA”) such as termination of employment and redundancy. 

This article is for information purposes only and is not and should not be relied upon as legal advice. We strongly recommend that any employer or employee concerned about an employment law problem or issue should seek legal advice.

Everyday life has been severely impacted by COVID-19, and even after the pandemic eases or ends we will have to adjust to new ways of conducting ourselves and our businesses. These are likely to include new methodologies to prepare ourselves better to ensure continuity of businesses, and safeguard the livelihoods of employees.

During these testing times, it is easy to overlook important deadlines, legal obligations and those terms and conditions under a contract which continue to run uninterrupted, and the fulfilment of which may be rendered impossible. This commercial law guidance briefly reviews what options may be available under a contract should businesses face difficulty in performing their contractual obligations.

Please note we provide general guidance only regarding commercial contractual obligations in the context of the current pandemic. This guidance does not cover employment contracts as these should be considered separately in accordance with the Employment Relations Act 2007.

Redundancies are, unfortunately, a fact of life. For the most part they occur because an employer wants to restructure to adapt to a changing business environment. This adaptation means that new roles may be created in, or old roles removed from the employer's organisation. It is the removal of roles (or job positions) within the employer's organisation that leads to that role becoming redundant. When the role is removed the employee in that role is affected, and his or her employment contract terminated, by reason of the redundancy.

Fiji law recognises that employers are entitled to restructure their operations and make roles within their organisations redundant. But Fiji law also regulates this process by amongst other things: restricting the reasons that may justify a redundancy; setting out a redundancy process that must be followed; and setting a minimum standard for the redundancy package that must be given to the employee who may be terminated by reason of redundancy at the end of this process.

In this commercial law update, we provide more information on the minimum standards that employers must follow. But because this is not intended as legal advice and should not be relied on as such - all employers who may be contemplating redundancies should consult a lawyer first. It must also be remembered that at all times all employers owe a duty to treat their employees with good faith, and the redundancy process under Fiji law must not be used as a disguise to terminate employees. Getting this process wrong, can be an expensive mistake, and we briefly discuss recent case law in this regard from a jurisdiction outside Fiji.

Pursuant to Fiji law, in situations of serious employee misconduct the employer has two choices, either:

• a summary dismissal for cause (as set out in section 33 of the Employment Relations Act) when the employer is certain of the facts and those facts warrant immediate termination of employment; or
• to undertake a disciplinary inquiry to ascertain all the facts and then, if those facts are proven, take appropriate disciplinary action that may include termination of employment, suspension from employment or written warning.

In both situations, the employer is acting “for cause” and, if the employer terminates the employee’s employment, must provide the employee with written reasons for the termination of employment at the time of termination.

In this employment law update we consider summary dismissal (on the spot termination without a disciplinary inquiry process) and note that a recent judgement of Sanjay Lal v Carpenters Fiji Limited (Sanjay Lal v Carpenters) issued from the Employment Relations Court (“ERC”) on 10 August 2018 provides some useful guidance from the ERC in relation to summary dismissal.

In a previous commercial legal update we provided some general information regarding the employer's duties relating to dismissing an employee for misconduct. This update can be found: here

Connectivity has made the access to information easier in this modern age, but it has also led to the increase in harmful online behavior such as cyberbullying, cyber stalking, internet trolling and exposure to offensive or harmful content, amongst other things. After much debate, Fiji has introduced the Online Safety Act, 2018 (the “Act”) to promote online safety and deter adverse online behavior and misuse of personal information. While it was enacted on 18 May 2018, it will not come into effect until the commencement date is gazetted.

At the date of writing the Online Safety Act has not appeared in the Fiji Government Gazette and therefore the legislation is not, as yet, in force. We will amend this update when it is “gazetted”.

In this commercial law update, we consider how this newly-introduced Act is intended to work.

Each construction contract has its own different areas of risk.

In this commercial law update, we consider only the general areas in which risks can arise and need to be managed in a construction contract.

The best way of ensuring the efficient management of your risk in a construction contract is to negotiate the management and allocation of those risks during the negotiations stage.

The more effort the parties put into ensuring a properly managed and allocated risk profile during the process of negotiation, the more chance there is of the parties avoiding otherwise preventable situations during the implementation of a contract.

In this commercial law update we set out how to negotiate a construction law contract and provide some basic points to note.

Risk Allocation

This commercial law update looks at the principles behind efficient risk allocation in a contract and how, a lack of understanding of these principles, might lead to unintended consequences.

Every contract is essentially a sharing or allocation of risk, responsibility, and reward between the parties. It is not sufficient for commercial lawyers to rely on template contracts or checklists because to understand and assist with a commercial transaction requires an understanding of the risks involved. A thorough understanding of risk will assist with the provision of informed legal advice and a contract that may avoid, reduce or fairly allocate risk.

This legal update considers the key questions that arise in terms of the allocation of risk: how should the risks be shared? Is there an efficient way of sharing risk? What considerations should be taken into account when deciding which party should take on which risk in a contract?