Court dismisses wrongful termination suit by former Prudential agency leader who blew the whistle to MAS

SINGAPORE: The High Court has dismissed a wrongful termination suit by a former Prudential agency leader who claimed he was fired because of his whistleblowing activities.

Mr See Jen Sen had worked for Prudential Assurance Co Singapore for 19 years, before his agency agreement was terminated in March 2022.

Mr See alleged that the termination came about because he blew the whistle on Prudential's alleged malpractice in its business to the Monetary Authority of Singapore (MAS).

In a judgment issued on Monday (Nov 10), Justice Choo Han Teck dismissed all the claims by Mr See for wrongful termination, unjust enrichment and a claim under the Unfair Contract Terms Act.

He also dismissed a counterclaim by Prudential, which stated that it suffered loss by Mr See's breaching of clauses in the agency agreement.

Mr See was represented by Mr Ragbir Singh Ram Singh Bajwa from Bajwa & Co and Mr Gan Teng Wei from Castle Law, while Prudential was represented by Mr Terence Seah and Mr Joavan Christopher Pereira from JWS Asia Law.

THE CASE

Mr See was an agent, associate manager and agency leader at Prudential.

In October 2020, he was a financial services director at Prudential when he came to know of advertisements for life insurance on social media by Prudential representatives and third parties.

Mr See believed that these were not in compliance with advertising guidelines set out by MAS.

Mr See raised his concerns with Prudential's compliance team in October 2020 and wrote to the then-chief executive officer of Prudential, who referred his complaint to the company's chief risk officer.

Investigations were conducted for about three months with no result, said Justice Choo.

Mr See then contacted the CEO again in January 2021. When the CEO replied, Mr See responded with some proposals, but was met with no further response.

Subsequently, Mr See wrote to MAS on 13 occasions between May 2021 and October 2021 under the pseudonym "Patrick Goh" to notify MAS of the breaches.

In November 2021, Prudential sent an email to Mr See entitled "Re: levying of complaints to Prudential Assurance Company Singapore (Pte) Limited ("PACS") and/or Prudential Corporation Asia Limited ("PCA") and/or the MAS under the identity of 'Patrick Goh'".

Mr See attended a meeting later that month where he met with the head of conduct surveillance, head of distribution business partner and head of legal.

On Mar 7, 2022, Prudential served a termination notice under the agency agreement on Mr See, giving him 14 days' notice of termination.

Mr See sued Prudential for wrongful termination, claiming he was dismissed because he was a whistleblower.

He claimed shares and cash rewards under the Agency Leaders Long-Term Incentives Scheme, which he would have been entitled to had he not been dismissed.

Mr See also alleged that Prudential "arbitrarily, capriciously and wrongfully rejected" his application for the sell-out/retirement scheme. He claimed payments under the scheme at the time of the alleged wrongful termination, and asserted that Prudential was "unjustly enriched" by retaining the money due and payable to him.

In its defence, Prudential said the termination was within its contractual right to terminate with notice. Mr See was not entitled to payment under the Agency Leaders Long-Term Incentives Scheme as he did not have a valid agency agreement at the point of payment, and he was unable to participate in the sell-out scheme because his application was not valid.

Prudential also denied that it was liable for unjust enrichment and counterclaimed against Mr See for breaching his agency agreement, as he did not lodge his complaints through the proper channels set up in Prudential's corporate structure.

JUDGE'S FINDINGS

Justice Choo found that the wrongful termination claim failed. Mr See's case was that the company’s right to terminate Mr See was subject to an implied term of "good faith, mutual trust, confidence and goodwill".

However, the agency agreement stated that "any party may terminate this agreement by giving to the other party 14 days' notice of termination in writing".

Mr See's lawyer, Mr Singh, had argued that Prudential terminated the agency agreement because it was upset and angry at Mr See for complaining directly to MAS.

Mr Singh contended that the termination was "retaliation and vindictiveness" and an exercise of "extreme bad faith". He argued that Prudential had the wrong reason for terminating the agreement, thereby breaching the implied term of "good faith, mutual trust, confidence and goodwill".

But Justice Choo disagreed. He said that for Mr See to succeed, he must establish that such an implied term exists in the contract and that it applies to the termination clause.

"I find that he has not done so," said the judge. "It is settled law that implied terms, such as the one in question here, do not apply when there are express termination clauses to the contrary."

He said there was no basis for Mr See to assert that the agency agreement was terminated for the wrong reasons, and found that Prudential was within its strict legal rights in terminating him.

Since the termination was not wrongful, the claim under the Agency Leaders Long-Term Incentives Scheme also failed as Mr See did not have a valid agency agreement at the time the next payment tranche was due.

Justice Choo also found that the claim under the sell-out scheme failed, because Mr See did not make a valid application to participate in the scheme.

While he had sent two emails to Prudential in March 2022 which he said constituted his application, the judge found that they did not contain any of the details required for the application.

Justice Choo also found that Mr See's unjust enrichment claim had "no merit".

He also found that Prudential failed in its counterclaim that Mr See had breached the agency agreement because he did not adhere to Prudential's guidelines relating to the submission of regulation-related queries and feedback.

The judge found that Mr See did not ignore the guidelines. He had raised his first complaint to the compliance team, and sent an email to the CEO "due to his view on the urgency of the matter".

At the time, this was evidently not taken to be a breach of the agency agreement, since the CEO responded with "thanks for bringing this to my attention and instructed his chief risk officer to investigate.

"In my view, this was an acknowledgement by the CEO on the urgency of the matter, and therefore, an acceptance that the claimant had reached out to him directly, against the guidelines. Thus, I find that the defendant cannot rely on this email to the CEO to establish its counterclaim," said Justice Choo.

Mr See's complaints to MAS also did not constitute a breach of the agency agreement, said the judge, noting that Mr See had only contacted MAS after attempting to use the internal channels under the guidelines.

The documentary evidence also showed that Mr See had approached the CEO again in January 2021, almost three months after his initial complaint, to share his grievances about the investigation being "ineffective" because the advertisement had already been taken down.

The CEO responded and acknowledged that a proper framework was necessary for the use of social media and outlined the steps taken by the company, noted the judge.

He found that Mr See did not breach the guidelines in approaching MAS.

"It became clear that the internal process, pursuant to the guidelines, was ineffective in resolving the issues complained of," said Justice Choo.

Prudential said that Mr See complained to MAS despite knowing that it would bring the company into disrepute, when Prudential was regulated by MAS.

"However, I find that the duty of good faith and undivided interest in this context is circumscribed by the broader public duty to report, in good faith, purported breaches of advertising guidelines of the MAS meant to protect the wider public," said Justice Choo.

"From the documentary evidence, it is clear that the acts of the other agents contravened the MAS advertising guidelines. The claimant’s complaints might well have brought necessary actions by MAS to stop those practices."