Payzone chief executive John Nagle and chief financial officer John Williamson have secured High Court injunctions restrain- ing the company from dismissing them from their posts pending the outcome of full legal proceedings.
Ms Justice Maureen Clark yesterday ruled that Payzone's defence to the executives' claims of unlawful termination of contract was "devoid of merit" and said they were deprived of constitutional justice and fair procedures.
However, the judge stressed that her decision granting the injunctions relates to the existing purported termination of both men's contracts and does not prevent the company from em- barking on a process which conforms with the executives' contractual rights and the company's own articles of association.
Five of Payzone's shareholders earlier this week submitted a request to the company to hold an extraordinary general meeting for the purpose of removing Mr Nagle and Mr Williamson from their posts.
The market was informed by Payzone on January 15th last that both men had left the company, a claim denied by both executives who on January 16th last secured interim High Court injunctions restraining their removal. Those injunctions now remain in place pending the full hearing of the action by the men, which the judge anticipated would be heard within the next few weeks.
Paul Sreenan SC, for Payzone, said he would take instructions on whether the company wished to appeal the injunctions ruling and the judge listed the matter for mention next Wednesday.
In her preliminary judgment, Ms Justice Clark ruled that there was "considerable merit" in the executives' claims that Payzone has "no answer" to their claims that their contracts were not terminated in accordance with the terms of their written contracts of service or in accordance with Payzone's own articles of association.
Their case was among those rare cases where the breach of contract was so clear and the defence to the case so "devoid of merit" that the court should grant the injunctions sought, she said.
The judge also noted "the lack of evidence" to support the "much repeated assertion" by the company that the majority of the board and the shareholders had lost confidence and trust in Mr Nagle and Mr Williamson.
She also noted that Payzone chairman Bob Thian had conceded in his affidavit that no board meeting took place where it was decided to terminate the men's contracts.
It was also conceded no meeting of the company took place to ratify such a decision before a letter purporting to terminate the contracts was issued on January 15th.
Mr Nagle and Mr Williamson were also never afforded an opportunity, in accordance with the principles of constitutional justice and fair procedures, to answer any allegations made against them which would justify their removal as directors or from their posts, she said.
