way of indemnity. The defendant Bank denied that the two monthly increases
way of indemnity and the value of the quarters formed part of plaintiff's pensionable salary. They admitted liability to pay plaintiff a pension of 28.80 Turkish pounds which they alleged were equivalent to £26.3.8 in Cyprus paper currency. Crean, Ag. C.J., found that "the basis of payment of salaries and pensions is gold; which must meanthat these salaries and pensions are payable in gold or its equivalent value in the currency of the country in which the employee has been working when retired," and gave a declaration that plaintiff was entitled to a monthly pension equal to 28.80 Turkish pounds gold, payable in Cyprus currency according to the rate of exchange prevailing on the date when the pension became due. The appellant Bank appealed to the Supreme Court. Clerides for the appellant. Triantafyllides for the respondent. JUDGMENT:- STRONGE, C.J.: The plaintiff in this action entered the employment of the defendant Bank in 1903 and became a member of its permanent staff in 1905. He subscribed (see Exh. A.D. I and H.L.J. II) to the Regulations of the Pension and Superannuation Fund (hereinafter referred to as the Pension Regulations). In 1923 he was transferred from Constantinople (where he was then serving temporarily) to Cyprus. In 1926 he was informed in a letter from the defendant Bank dated 25th May, 1926, that he was to receive "une augmentation de traitements sous formed'indemnit?" of L. Tqs. 2 monthly, and
letter of 23rd January, 1929, he was informed of a further "augmentation sous formed'indemnite" of L.T. 2 per month.
a letter from the, defendant Bank dated 19th September, 1931, he was informed he would be put on pension as from the 1st January, 1932, and a further letter from the defendant Bank dated 29th September, 1931, informed him that his pension would be payable on the basis "L. Tqs. 28.80 at 110: L. sterling £26.3.8." To the calculation on this basis the plaintiff
his letter dated 5th October, 1931, (Exh. A.D. VIII)took exception, pointing out that his pension should be calculated not only on L. Tqs. Gold 45 (as his basic salary), but also on the two increases of L. Tqs. Gold 2-and on the free quarters occupied,
him as manager. The reply to this letter was a communication from the Direction G?n?rale of the Bank at Constantinople dated 10th November, 1931, (Exh. A.D. XI) in which he was told that these claims were contrary on all points to the Pension Regulations. It was admitted at the trial that there was nothing in the Regulations on these points. On the 31st December, 1931, he was retired, and on the 3rd February, 1932, the writ in the present action was issued. The issues raised
the pleadings were the three foreshadowed in the Exh. A.D. VIII and A.D. XI just referred to. The learned trial Judge in a considered judgment found that the plaintiff's salary was on a gold basis and that he was,consequently, entitled to a monthly pension equivalent to 28.80 Turkish gold pounds to be calculated in Cyprus currency at the rate of exchange prevailing on the date when the pension (which I take to mean each monthly instalment of the pension) becomes due. Against this part of the decision the defendant Bank has brought the present appeal. On the issues whether the two increases of £2 each per month and the free quarters were pensionable the learned Judge decided in favour of the defendant Bank. Against the trial Judge's finding on the first of these two issues the plaintiff has brought a cross-appeal, the contention that he was pensionable in respect of the free quarters being abandoned. The grounds of the defendant Bank's appeal are:- (
him on the 31st December, 1930. At the trial in addition to the oral and documentary evidence adduced counsel for both parties
agreement made use of the printed record of the Privy Council Appeal in Chakarian Case, and the record in Esmerian Case; these records were also referred to in the arguments before us and must, consequently, be regarded as forming part of this case. The trial Judge points out in his judgment that there was no express agreement-oral or written-specifying the currency in which the salary or pension was to be payable, and that the Pension Regulations are silent on the question. The learned Judge states that in the absence of such evidence he rests his finding that the salary basis was gold on the evidence of the plaintiff and his witness, OhanesChakarian, and on that of Mr. Jones, the Regional Manager of the Cyprus branches of the defendant Bank, who was the only witness called for the defence. The veracity of none of these witnesses was called in question
counsel and the trial Judge did not make any criticism upon it. The functions of an appellate Court in such a case are pointed out in the following passage from the judgment of Halsbury, L.C., in Montgomerie and Co. v. Wallace James
Cave, L.C., in Mersey Docks and Harbour Board v. Procter
the Bank's employees even if there had been no issue of currency notes. The Bank in response to appeals from its employees on the ground of this increase in the cost of living came to their assistance, and the method at first adopted to alleviate the situation was the grant from time to time of advances of continuously increasing percentages of their salaries. Side
side, however, with the increase in cost of living there was also taking place an ever-increasing depreciation in the Turkish paper pound, so that eventually the employees notwithstanding these percentage advances to meet the cost of living found themselves in very straitened circumstances. They applied to the Bank to be paid in gold-as in the years prior to 1916- or in its equivalent in paper money at the current rate of exchange. The decision of the Management Committee does not seem quite to fit in with the contention now advanced
the defendant Bank that the applicants had no right to be paid in gold. They refused the application for payment in gold, not on the ground that the staff had no such right, but on the ground that "in the present circumstances the Bank must scrupulously preserve its stock of gold." Not "you have no right to gold"but "we haven't gold available." The system of making advances of continuously increasing percentages of salaries was continued down to January, 1920, when it was replaced
a decision of the General Management to convert the monthly salaries of employees in Turkey into sterling at the rate of 110 Turkish pounds for 100 pounds sterling and pay each employee his salary in Turkish currency notes at the average selling rate of the pound sterling as registered at the Head Office during the immediately preceding three months (Decision of 27th January, 1920). Under this system-according to the evidence of the plaintiff corroborated
that of OhanesChakarian the number of Turkish paper pounds which employees were to receive was arrived at
converting the Turkish gold pounds of salary into English sterling in the ratio of 110 to 100- this, according to the evidence of the plaintiff and OhanesChakarian, being the actual ratio of the weight of the Turkish gold pound to that of the English sovereign (7.216 and 7.988 grammes respectively). The equivalent value in English sterling having been thus ascertained was then converted into Turkish paper pounds at the current rateof exchange. This method of arriving at the equivalent in Turkish paper money of the employee's salary after it had been converted into sterling was followed for nearly a year and a half. It was superseded
a decision in May, 1921, of the Management Committee arbitrarily fixing 451 piastres as the number to be taken as the equivalent of the pound sterling, and to the result in Turkish paper pounds 10 per cent was to be added for salaries not exceeding L.Tqs. 55. In 1923, after the plaintiff had gone to Cyprus, the Bank adopted a method of directly converting the Turkish pound into paper
treating it as equivalent to 410 piastres. Down, then, to the decision of May, 1921,
which the Bank proceeded to fix the number of piastres which it would regard as the equivalent of the pound sterling, it seems evident that salaries were being paid on a gold basis, being first converted into sterling at the rate of the Turkish gold pound to the English sovereign and the resulting sterling being in turn converted into Turkish paper money at the selling rate of the pound sterling. The amount of Turkish paper money thus yielded was the salary received
the employee. Had Turkish gold pounds been procurable any employee desiring to do so could,
reversing the process of conversion have procured Turkish gold pounds equal in number to the Bank's original figures of his month's salary (Evidence of OhanesChakarian, p. 21). It was argued that the so-called "basic" Turkish pound means the paper Turkish pound, and that this conversion process was employed in order to convert paper Turkish pounds into paper Turkish pounds. To me this seems much as if one was to speak of converting half crowns into half crowns or sovereigns into sovereigns. I do not comprehend how conversion can be said to have taken place unless the money converted has been turned into money which is either of a different denomination or of a different kind. From May, 1921, however, when the Bank began to fix the number of piastres which it would regard as the equivalent of the pound sterling or (later on) as the direct equivalent of the Turkish pound, the will of the Bank bacame, as it were, the basis of payment, because instead of the number of piastres being determined
the actual selling price of sterling as theretofore, it now rested wholly with the Bank to say how many or few it would give. It was argued that the result of this arbitrary fixing of the number of piastres being that the salary in paper pounds received
the plaintiff was no longer the equivalent of 45 Turkish gold pounds, his acceptance of such salary is conclusive evidence against the contention that he was paid on a gold basis and amounts to such an acquiescence on his part as estops him frommaintaining this action. In considering such an argument regard must, I think, be had to all the circumstances of the case. The plaintiff was at the time in Turkey, in the employment of the defendant Bank, which after paying salaries for a number of years in gold or on a gold basis, arbitrarily decided to pay them on a basis to be determined
its own volition. The employees, thereupon, according to the evidence of OhanesChakarian, sent in a protest. More, I think, could not reasonably have been expected of them. The taking of proceedings in the Turkish Courts to test their rights against what is admittedly the State Bank (statement
counsel for defendant: p. 31, Esmerian Record) would, on the face of it, appear to hold out a very slender chance of success. Having regard to these circumstances I do not think it can be said that the plaintiff during the years 1922-23 acquiesced in payment of his salary on this basis. His position, as I view it, was one of involuntary quiescence rather than acquiescence, and cannot, consequently, be held to amount to an estoppel. From May, 1921, down to April or May, 1923, the date when plaintiff left Constantinople for Cyprus, this decision of the Management Committee with its artificial figure of 4.51 as the equivalent in Turkish paper pounds of the English pound sterling fixed the basis of his salary-the actual figure, the plaintiff states, was 7.85. The plaintiff's salary, according to his evidence, was arrived at as follws:- 45x100/100 x 4.51 =18,450 Turkish piastres or 184.50 Turkish paper pounds to which was added 10 per cent giving a total of 202.95 paper pounds (equal to £27 sterling) instead of 353.24 paper pounds. The plaintiff further stated that had his monthly salary at that time been 45 Turkish paper pounds it would only have been equal to about £6 sterling. OhanesChakarian, who was an employee of the defendant Bank from 1912 to 1931, gave evidence that when he was working in Smyrna in 1921 to 22 the basis of the salaries of the Bank's employees was the Turkish gold pound. He also corroborated the evidence of the plaintiff as to the Turkish gold pound being converted into English sterling at the rate of 110 to 100 and the resulting sterling being then converted into Turkish paper notes at the actual rate of exchange of sterling. Mr. Jones in his evidence stated he "knows nothing about the methods of running the Bank in Turkeyas to value and payments of salaries to officials in Turkey since 1915." His evidence, therefore, is of no assistance to us in considering what was the basis of the plaintiff's salary during that portion of his service in Turkey when the Bank was no longer paying salaries in gold. On the foregoing evidence I have come to theconclusion that down to May, 1921, the plaintiff's salary was on a gold basis and that from that time on to the time he left for Cyprus he had a legal right to a salary on that basis-a right which was violated
the Bank arbitrarily fixing the number of piastres it would regard as equivalent to the pound sterling, instead of taking the rate of exchange as had been done theretofore. I am also of opinion for the reasons I have stated that the plaintiff cannot be said to have acquiesced in the payment of his salary on this basis. I come next to the basis of payment of salary during the period (1923 to 1931) of the plaintiff's service in Cyprus. Objection was taken
Mr. Clerides to the admission at the trial of evidence
the plaintiff of a statement or promise alleged to have been made to him prior to his departure for Cyprus
Mr. Scanziani (then Director of Personnel at Constantinople of the defendant Bank) that in Cyprus plaintiff's salary would be as formerly and that he would draw his salary in parity. The ground of objection was that no allegation of any such promise had been pleaded in the Statement of Claim. Whether this objection is or is not well founded is, I think, a matter which it is unnecessary to discuss as there was other evidence to the same effect before the Court. In the Chakarian Case, for instance, Mr. Reid stated on cross-examination: "If a clerk were employed in Constantinople at a salary of £30 and were transferred to Cyprus he would be paid £27.10.0 calculated on the basis of pounds Turkish 110 to 100 sterling. Upon transfer to a place outside Turkey no fresh agreement would be made as to the salary payable. Any clerk employed in Cyprus would have his pension here in sterling at the rate of Turkish pounds 110 to 100 sterling." (Chakarian .Record, p. 18.) The plaintiff's evidence as to the period of his service in Cyprus was that he received his first salary in Cyprus at the end of May, 1923, in Cyprus currency notes amounting to £40.18.1 converted from Turkish gold at the rate of 110 to 100-the ratio of Turkish and English gold pounds-and that the Cyprus £1 note was at that time worth a gold sovereign. That during his 26½years service in the Bank in Palestine, Turkey and Cyprus he had always in the books of account had to express the ratio of Turkish gold to English gold as 110 to 100. OhanesChakarian stated that sometime after he came to Cyprus in 1923 he had control of the books of the Bank and that in the Cash Book English sovereigns and Cyprus paper currency were counted at the same rate. That the relation of the gold Turkish pound and the English pound appeared in the Bank's books as 110 to 100 and this relation was a real one. Mr. Jones in giving evidence said: "In Cyprus we pay at the rate of 110 to 100 which is a conventional rate. The employees were paid in Cyprus on this conventional rate. The salaries of employees in Cyprus are not to my knowledge in gold." Under cross-examination he stated: "In the contract of plaintiff the pound referred to may have been the gold pound or paper pound. The basis of payment of pensions and salaries is gold but I say the fixed ratio is 110 to 100 and this is a conventional ratio. The 110 to 100 is the parity between the Turkish gold pound and the English sovereign." I may say in regard to the first quoted answer in cross-examination of this witness that as the contract of the plaintiff, consisting of the Pension Regulations to which he had signed his assent, came into force in January, 1899, and as at that time there existed in Turkey no other pound than the gold pound, the pound referred to in the contract is undoubtedly the gold pound. I turn to the Salary Book of the Larnaca branch which covers the period January, 1928, to July, 1931, and in which month
month the salaries of the Larnaca staff are entered opposite the names of the individual members. The page appropriated to each month is divided into vertical columns. First comes a column headed: "Traitements en L.Turqs." Next to it and immediately to its right is another column headed: "Indemnit?s." Then come two others showing the employees' and the Bank's respective contributions to the Pension Fund. Then there is a column headed-like the first: "Traitements en L.Turq." and finally we have a column headed: "Contrevaleur"followed either
the words "en £ sterling" or "en £ "or "£ s. Cp." In the first mentioned column under the heading "Traitements en L. Turqs" there appear each month the figures 45, denoting the plaintiff's salary. In view of the uncontradicted evidence that at the date of his departure for Cyprus the plaintiff was actually receiving 212.95 (it should read 202.95) Turkish paper pounds as monthly salary it cannot, I think, be successfully maintained that these 45 L.Tqs. appearing as his salary are Turkish paper pounds. If not Turkish paper pounds, they must be Turkish gold pounds, as no other kind of Turkish pound exists. After the deduction of L.Tqs. 2.25 as plaintiff's contribution to the Pension Fund and the addition of his L.Tq.4 for indemnities the net salary due to him appears in the last column but one (headed "Traiternents en L.Tqs. ") as 46.75 and its equivalent- the sum actually paid to and received
the plaintiff is shown in the "contrevaleur" column as £42.10.0, that is to say the L.Turq 46.75 have been converted into Cyprus currency at the rate of 110 to 100-the rate, as we have seen, of the Turkish gold pound to the gold sovereign. In view of the answer of Mr. Clerides to the Court that there is no. other Turkish coin than the Turkish gold pound theratio of which to the English sovereign is 110 to 100 the natural inference, as it appears to me, is that wherever you make use of that ratio to convert Turkish pounds and your result is English gold or its equivalent the Turkish pounds so converted are not paper pounds but gold pounds. The L. Tqs. 46.75, shown in the Salary Book represent, consequently, Turkish gold pounds. Mr. Jones in his evidence said that the ratio of 110 to 100 was a conventional one, meaning, as I understand it, one that is a matter of general agreement or custom (of which an example is given in Scott v. Bevan-the Jamaica case
employing that ratio the reasonable inference, as I have said, is that the Turkish pound so converted was the Turkish gold pound and not the Turkish paper pound. Mr. Clerides argued that as sterling was off the gold standard during the years 1923 to 1925 and the plaintiff was being paid in Cyprus currency throughout that period his salary was not on a gold basis. In support of this contention Mr. Clerides referred us to the following Cyprus proclamations: two of September and December, 1914, two of June and September, 1915, and one of September, 1917 Both of the 1914 proclamations and that of September, 1915, state that the currency notes issued under them are to be "redeemed at face value." The 1917 proclamation states that the notes issued under it "shall be redeemed," omitting the words "at face value." Mr. Clerides argued that after the 1917 proclamation the Cyprus currency note was no longer equal to gold since the Cyprus Government no longer undertook to redeem the 1917 currency notes at their face value. Mr. Triantafyllides, on the other hand, contended that the fact of sterling during this period being off the gold standard was immaterial because at that time Cyprus currency notes had a separate existence apart from English sterling and remained independent of it down to 1930 when
Article VI of the Imperial Cyprus Currency Notes Order in Council of 1928 they were for the first time made interchangeable with English sterling. The plaintiff's evidence on this point is that "at this time a Cyprus £1 note was worth a gold sovereign." OhanesChakarian says: "in the Bank's Cash Book English sovereignsand Cyprus paper money were counted at the same rate and the plaintiff as we have already seen corroborates him as to this. Although there is no express statement in the 1917 proclamation that the redemption is to be at face value, the words "shall be redeemed" nevertheless imply, I think, that such was to be the case. To give these words the meaning contended for
Mr. Clerides would necessarily mean that it would have been open to the Cyprus Government to satisfy its obligation to redeem
fixing the lowest current copper coin as the price of each £1 currency note. An assurance of redemption on such terms as those would be worthless and I doubt if the word redemption in the ordinary acceptation of the term can be properly applied to such a transaction. In the view I take of the matter such a meaning of the words "shall be redeemed" in the proclamation was never contemplated and they were intended to be used in the sense of redemption at face value. Apart, however, from these words in the proclamation there is the uncontradicted oral evidence that the £1 Cyprus currency note was at the time the equivalent in value of the English sovereign. (After discussing the views expressed
the Court of Appeal in In re Soci?t?Intercommunale Beige which were overruled
the House of Lords, the judgment proceeds): It may be said that as in that case the parties made use of an expression in the bond which was of uncertain meaning, so in this case, the parties have in the Pension Regulations which constitute the contract between them made use of the expression "L.Tqs." in regard to salary or pension (e.g., in Article 16), an expression which is of uncertain meaning and capable of being interpreted as signifying either Turkish gold pound or Turkish paper pound. To this I think the answer is that there is no such ambiguity in meaning inasmuch as the expression "Ltq." must be take to bear that meaning in which it was understood
the parties at the time they entered into the contract and at that date the expression could only have been understood
them to mean, the Turkish gold pound, because neither then nor for over eleven years afterwards was there any other kind of Turkish pound in existence. Somewhat similar observations, in my opinion, apply to the more recent case of the Broken Hill Proprietary 0o v. Latham reported since the present case was at hearing. The case of AssicurazioniGenerali v. SelimCotranturned on the nationality of the defendant compnay at the date of theLausanne Treaty which contained specific provisions as to the currency in which payment should be made. It is therefore of no assistance in the present case. I have read and carefully considered Chakarian's case from its inception to the final appeal before the Privy Council. For the reasons which I am now about to state I am of opinion that as far as the calculation of the pension in that case is concerned the decision does not govern the present case. The main question in dispute in that case was one of wrongful dismissal. The basis on which the plaintiff's pension should be calculated was a subsidiary question, material only in regard to the computation of the amount of damages to which the plaintiff was entitled. The plaintiff's monthly salary was 25 Turkish pounds, to 50 per cent. of which, i.e., 12.5 Turkish pounds, he was admittedly entitled as pension. The trial Judge took the view that the salary was on a gold basis and that the plaintiff was entitled to his pension on that basis. He consequently treated the 12.5 Turkish pounds as being Turkish gold pounds .and using the ratio of the Turkish gold pound to the English sovereign (110 to 100) converted them into their English equivalent £11 .7.2 which he held to be the amount to which plaintiff was entitled as pension. On appeal, the Chief Justice, taking October, 1922-the date of dismissal-as the material time, proceeded to calculate the plaintiff's pension in Turkish paper pounds, and for this purpose accepted-apparently without question -as his basis of calculation the decision of the Management Committee of 18th May, 1921, fixing 451 piastres as the equivalent of the pound sterling. Mr. Reid in his evidence had stated it was not in fact the equivalent, and from the evidence of plaintiff in the present case it appears that the equivalent was 785 piastres. Two preliminary questions, as it appears to me, ought to have been considered before adopting this decision of the Management Committee as a basis of calculation: (a) Was the rate of 451 in the decision the de facto equivalent in paper piastres of the English pound sterling (b) If not, was the Bank within its legal rights in substituting for a process
which the employee's salary in Turkish pounds was converted into English sterling at the rate of 110 to 100 and he was paid the equivalent selling price of that sterling in paper piastres, a process in which the number of paper piastres was no longer determined
the selling price of sterling but
the ipse dixit of the Bank. The question as it appears to me was not "whether" as the learned Chief Justice puts it "the respondent would have received any higher pension if he had resigned and stayed on in Turkey" (I have little doubt he would not) but rather whether he had a legal right to continue to have his salarypaid on the basis theretofore subsisting instead of on a basis arbitrarily fixed
and variable at the will of the Bank. If he had that right-as in my opinion he had-then the learned Chief Justice-his attention not having been directed to the question-would seem to have erred in adopting the artificial rate of 451 piastres fixed
the Management Committee instead of 785 the actual rate.
so doing he arrived at his figure of Chakarian's total salary as 112.75 Turkish paper pounds and his pension as 56.375 Turkish paper pounds. I find myself somewhat perplexed
that passage of the learned Chief Justice's judgment where he is reported to have said that the Court below arrived at the pension of £11.7.2
substituting the present rate of Turkish piastres to sterling. The £11.7.2, as already pointed out, was arrived at
the Court below
taking the admitted pension of 12.5 Turkish pounds as Turkish gold pounds and converting them into English money
using the ratio of 110 to 100 which is the unvarying ratio of Turkish gold to the English sovereign. The term "present rate," if the Chief Justice intended it to refer to this unchanging ratio of 110 to 100, does not seem a very suitable one, and it certainly was not the "rate of piastres to sterling." At the hearing of Chakarian's appeal before the Privy Council their lordships on the question of damages expressed (1930, A.C. p. 284) their agreement with the majority Of the Judges of the Court of Appeal as to the measure of damages and the basis on which-for that purpose- the respondent's pension was to be calculated, but they were of opinion-having in mind, apparently, Article 14 of the Pension Regulations-that it must be calculated on the salary which the respondent actually received on the 31st December, 1921-the year 1922 in the report is obviously a misprint. It was agreed that on this basis the pension worked out at 56.375 Turkish paper pounds as arrived at
the Chief Justice, and their lordships, consequently, accepted this figure holding, however, that for the purpose of a decree in English money the rate of exchange current at the date of dismissal and not the rate current at the date of the decree should be adopted. It does not appear to have been brought to the notice of their lordships that the learned Chief Justice in adopting as the basis of his calculation the decision of the Management Committee of 18th May, 1921, was working upon an artificially fixed rate of 451 paper piastres to the pound sterling instead of the actual rate of 785. Had their lordships' attention been drawn to the fact that this was the case I doubt if they would have adopted the Chief Justice's figure of 56.375 Turkish paper pounds as the correct one Such are the reasons which leadme to conclude that so far as the calculation of the pension is concerned the decision of the Privy Council in Chakarian's case is not a decision that the pension was not on a gold basis nor binding on this Court in calculating the pension of the plaintiff in the present action. The next argument to be considered is that the plaintiff without any protest accepted his salary in Cyprus currency for the months of September, October, November and December, 1931, when sterling was off the gold standard, and that this acquiescence is fatal to his claim either as disproving that his salary was on a gold basis or
way of estoppel. It is admitted that in September, 1931-the plaintiff in his evidence puts it sometime after the 17th-English sterling went off the gold standard. The Imperial Cyprus Currency Notes Order in Council of 1928 came into force on 16th January, 1930-the date of its publication in Cyprus (1930, Cyprus Gazette, p. 23), and it is not, consequently, contended
the respondent that Cyprus currency notes were in 1931 independent of English sterling as is alleged to have been the case in the years 1923 to 1925. The Pension Regulations make the salary received
the plaintiff on 31st December, 1930, the salary on which his pension is to be computed so that salary received
him after that date whether at a lower or higher rate cannot diminish or increase the amount of basic salary on which such pension is to be reckoned. The plaintiff's acceptance, however, without demur of his salary on a non-gold basis for a considerable period of time might fairly be taken, I think, as showing that he did not think he had the claim to be paid on a gold basis which he now asserts. As to September, 1931, I think that his acceptance for that month affords no such evidence against him. The salary book is made up several days before the end of the month and it was not until after the 17th that sterling went off the gold standard. At the time therefore when the plaintiff received his salary there had been little or no opportunity of realizing that payment in Cyprus currency was not of the same value as hitherto. In his letter of 5th October, 1931, (Exh. A.D. VIII) the plaintiff says: "my pension must be calculated not on the sum of L.T. gold 45 only, but" etc., although he does not explicitly state in so many words that his salary is 45 Turkish gold pounds the words I have just quoted imply, in my opinion, such an assertion
claiming that his salary in Turkish gold pounds is the basis on which his pension is calculable. In view of this letter, I am of opinion that his subsequent acceptance of his salary in Cyprus currency without further protest neither disproves his claim
showing his want of belief in it nor amounts to such acquiescence as would estop him from maintaining this action. Even if the letter be left wholly out of consideration I doubt whether the plaintiff's acceptance without protest of his salary for the final three months of his 26½ years' service in depreciated Cyprus currency could of itself alone having regard to the previous payments during that lengthy service be regarded as sufficient either to disprove his claim that his salary was on a gold basis or to create an estoppel so as to prevent his succeeding in this action. On the evidence and for the reasons I have stated I have come to the same conclusion as the learned trial Judge in regard to the plaintiff's salary and pension and am of opinion that the basis of payment of his salary was gold and that his pension is payable on that basis. This appeal should therefore in my humble judgment, be dismissed with costs. The question at what date the rate of exchange is to be taken for the purpose of calculating the equivalent in Cyprus currency of the plaintiff's pension of 28.80 Turkish gold pounds may most conveniently be dealt with at this stage. Mr. Triantafyllides cited numerous cases of which it will be sufficient to instance Barry v. Van Den Hurk; Lebeaupinv.Cripsin ;S. S. "Celia" v. Volturno ; and Peyrae v. Wilkinson. These cases and the others cited
Mr. Triantafyllides are authorities for stating that where money becomes payable in a foreign currency whether as a debt or in respect of a breach of contract or a tort, a plaintiff bringing his action for recovery thereof in an English Court is entitled to judgment in English money for such a sum as, would, at the rate of exchange current when the debt became payable or the tort or breach of contract was committed, purchase the amount of foreign currency payable. In the present case each monthly instalment of the plaintiff's pension of 28.80 Turkish gold pounds as it becomes payable gives rise to a debt due and payable
the defendant Bank and applying Peyrae v. Wilkinson supra, I think the plaintiff is entitled to a pension of such sum per month in Cyprus currency as will at the rate of exchange current on the date such pension becomes due form the equivalent of 28.80 Turkish gold pounds. I turn next to the plaintiff's cross-appeal, viz., that his salary on the 31st December, 1930, should be held to include the two monthly increments of £2 each granted him in1926 and 1929 respectively. The learned trial Judge in the course of his judgment says that in an action for wrongful dismissal such as Chakarian Case, all the emoluments received
the plaintiff whether
way of fixed salary, indemnity or free quarters are included in calculating the amount to which he is entitled as damages for the breach of the agreement, but that in the present case the plaintiff having been retired on pension pursuant to the Pension Regulations the question was what was included under the term "salary" for the purpose of calculating upon the basis of that salary when ascertained the amount of pension to which the plaintiff was entitled under those Regulations. The distinction to which attention was thus directed
the trial Judge is, I think sound and I therefore proceed to examine whether these increments are to be held to be included under the term"salary." I have already stated in a summarized form the provisions of Articles 9, 14 and 15 of the Pension Regulations which prescribe how the pension is to be calculated and it is unnecessary to repeat them here. The correspondence dealing with these two increases consists of three letters forming Exh. H.L.J.I., A.D. II and A.D. III. The first of these dated 12th May, 1926, is from the Direction G?n?rale of the Ottoman Bank to the Direction of the Ottoman Bank, Nicosia. Had a copy of this letter or a complete translation been transmitted to the respondent the question now before us would never, I think, have been raised in view of the following words appearing therein: "le traitement des interess?srestemaintenu a son chiffreactuel." The letters in which the Ottoman Bank, Nicosia, informed the Larnaca Branch and its Chief, the plaintiff, of these two increases form Exh. A.D. II and A.D. III. The first of these makes use of the words"une augmentation de traitement sous formed'indemnit?," while the second uses the words "augmentation sous formed'indernnit?." According to the evidence of Mr. Jones "augmentation" and "augmentation de traitements" are identical in meaning. Neither of these two Exhibits contain the intimation that the salary of the persons affected (scil.
the increase) is to remain unaltered at its present figure. I now come to the oral evidence bearing on the point. Both the evidence of the plaintiff and Mr. Jones shows that in addition to time meaning in which the term "indemnity "is used in Articles 3, 18, 19, 20, 21 and 22 of the Pension Regulations it is ordinarily in use in the Bank's service to denote various other descriptions of payments, such as payment for acting temporarily for another official, payment to meet increased cost of living, payment in respect of climatic conditions, payment of one month's salary to acashier to cover risk of loss, payment of the yearly bonus of one month's salary to each employee at Christmas. All these indemnities, according to the evidence of Mr. Jones, possess in common the feature of not being pensionable, the only item pensionable being fixed salary. The two last mentioned of the foregoing payments are entered in the Salary Book (H.L.J. III) the others are not. (Evidence of Mr. Jones). In my judgment the finding of the trial Judge that these two increases are not pensionable should be upheld for the following reasons: The use of the words "sous formed'indemnite" in A.D. II and A.D. III having regard to the plaintiff's knowledge of the kinds of payments to which the term "indemnity" was applied in the routine of the Bank, coupled with the knowledge that no retention towards pension is made in the case of indemnities-a knowledge which considering his position as manager may, I think, fairly be attributed to him seeing that it was possessed
OhanesChakarian-ought, in my opinion, to have conveyed to him the impression that the increase in salary in shape of indemnity which he was being granted was something distinct from an increase of salary simpliciter (augmentation or augmentation de traitement). His signing, too, for his salary month
month in the Salary Book (H.L.J. III) of the Larnaca branch in which his basic salary of L.Tq. 45 is entered in the column headed "Traitement" and the increase was entered in a separate column headed "Indemnit?" is, I think, evidence that he was aware it was being treated as an indemnity and not as basic salary.. Furthermore the next two columns showing the contributions in respect of his salary to the Pension Fund must have shown him that it was from the outset being treated as non-pensionable since no deductions were being made from this indemnity towards the Pension Fund. In other words the form of the entries in the Salary Book which he saw and signed every month were, in my opinion, a clear indication to him that this "augmentation de traitement sous formed'indemnite" was not pensionable salary, and I agree with what was said
the trial Judge that if the plaintiff really believed these increases formed part of his pensionable salary he would have asked why no contributions towards the Pensions Fund were being made in respect of them. The question of the Bank's right to grant such non-pensionable increases was not controverted before us, and I have not seen anything in the Pension Regulations which expressly prohibits them from doing so. I doubt if Article 30 can be construed to imply such a prohibition. I concur with the trial Judge in thinking it desirable that in letters conveying information of similar increases some such termas "non-pensionable personal allowance" should be made use of instead of the rather unsatisfactory word "indemnity." In my judgment this cross-appeal should be dismissed. From what has been stated in the foregoing judgment it follows that in my opinion the judgment of this Court should be that the appeal and cross-appeal herein stand dismissed and that the defendant (appellant) pay to the respondent the costs of the appeal less such costs, if any, as have been occasioned
the respondent's cross-appeal. THOMAS, J.: The respondent entered appellant's service in 1903 and in 1905 became a member of the pensionable staff when he signed a document declaring his adherence to the "Caisse de Pensions et de Retraites" which constitutes the contract of service subsisting between the appellant Bank and its employees. After serving in Palestine and Turkey he was transferred to Cyprus in February, 1923, as Manager of the Larnaca branch.
a letter dated 19th September, 1931, respondent was placed upon pension as from 1st January, 1932. It is agreed
both sides that respondent is entitled to a pension of 64% of the salary he was receiving on 31st December, 1930. It is so stated in a letter of the Management informing respondent of the amount of his pension. Respondent (plaintiff in the Court below) claims to be paid his pension in Turkish pounds gold, or so much in local Cyprus currency as will purchase such Turkish gold pounds, on the grounds that:-
the Bank, but a true relation expressing the relative weights of the two gold coins. Upon the evidence of the plaintiff and his witness, and upon the evidence of Mr. Jones, the Regional Manager of the appellant Bank in Cyprus, who stated that "the basis of payment of pensions and salaries is gold but at the fixed ratio of 110 to 100, which is a conventional ratio," the learned Judge found as a fact that the contract between the parties was that salaries and pensions are payable in gold or its equivalent value in the currency of the country in which the employee has been working when retired. In the action the plaintiff also claimed that the value of his free quarters and two increases of salary
way of indemnity should be treated as part of his pensionable salary. The trial Court decided that neither of these claims could be sustained. Respondent made a cross-appeal as to both claims, hut, as he has abandoned his claim to treat the value of free quarters as pensionable, it remains to consider the claim in regard to the increments
way of indemnity. Sums of money given each month to an employee for the work done
him, whether they are described as "salary" or as "salary
way of indemnity", would, in my view, certainly come within the scope of the term "traitement" in Article 14 of the Regulations, and would thus form part of the salary upon which pension must he calculated. It is true that the last part of the letter from the General Management to their Head Office in Cyprus (Exh. H.L.J. I) was omitted in communicating its contents to respondent. The sentence omitted is "The salary of the interested persons remains maintained at its present figure." This would have made it quite clear to respondent that that increase of salary
way of indemnity was not pensionable. The respondent stated in evidence that it was his duty as Manager of the. Larnaca branch to retain 4% of the fixed salaries of all employees in that branch. With regard to his own increment of £2 a month lie says: "I did not deduct on this amount as it was not on me to decide." Since he knew that the deduction of 4% must be made from all pensionable salaries, his failure to make the deduction in his own case clearly shows to my mind that he did not regard this monthly "increase
way of indemnity" aspensionable salary. Throughout the period he received these increments he treated them in the monthly returns to the Nicosia office up to the date of his retirement as non-pensionable salary in that he made no deductions in respect of them and for that reason I think be is now estopped fromalleging that these increases are pensionable. Appellant's first contention is that, as there is no express agreement that respondent's salary of Ltq. 45 was gold, the manner in which the salary was paid is conclusive. From 1923 to 1925 sterling was off the gold standard. The Statute of 1925 (15 and 16 Geo. 5) re-introduced the gold standard which remained in force until abolished
an amending Act dated 21st September, 1931 (21 and 22 Geo. 5). Counsel for the appellant argued before this Court at very great length that, because the respondent received during the years sterling was off the gold standard his salary at less than its gold value, therefore the Turkish pounds of salary are not gold pounds. In my opinion this is a fallacious argument. The manner in which respondent was paid during certain periods of his service in Cyprus is quite irrelevant to the only serious issue in this case, viz., what is the meaning to be given to the term "28.80 pounds Turkish at 110", which appellants admit their liability to pay respondent as his monthly pension. If appellant's obligation is to pay salaries in Turkish gold pounds, as the Court below found, the fact that the Bank paid respondent something less can in no way alter the nature of its obligation towards him. At the time the Pension Fund Regulations were issued there was only one Turkish pound in existence and that was the gold pound. This continued to be the only Turkish pound up to 1915 when paper pounds were introduced for the duration of the War. Counsel for the appellant stated in argument that "the salaries down to 1915 were admittedly in gold." It is therefore astonishing to find appellant's Manager for Cyprus declaring in evidence "in contract of plaintiff the pound referred to may have been the gold pound or paper pound." Since this witness was obviously aware that there were no paper pounds in existence until ten years after plaintiff's contract his answer is one which he must have known was not correct. The learned Judge at the trial did not accept Mr. Jones's evidence on this point, and I think he had sound reasons for so doing. The Law
which paper currency was introduced in Turkey in 1915 is set out at p. 97 of the record in Chakarian Case. Article 3 states that the paper notes are redeemable in gold six months after the conclusion of peace at Constantinople. The manner in which salaries were paid
the appellant Bank after the introduction of a paper currency in Turkey in 1915 is set out in great detail
Sertsios, J., in his judgmentin the Esmerian v. The Ottoman Bank. Up to 1915, as counsel for the appellant has admitted, all salaries of employees were in gold pounds, which are shown in the books of the Bank as "Ltqs.", i.e., pounds Turkish. From the evidence and the numerous documents referred to it is quite clear that all salaries of employees continued up to the present to be expressed in the same way, i.e., in pounds Turkish (see Salary Book, Exh. H.L.J. 3). From 1915 onwards, while salaries remain as they always have been in gold, frequent bonuses were given to compensate the employees for the rapid depreciation of Turkish paper pound. There were bonuses of 25%, 30%, 90%, 125%, 150%, up to 200% in 1920, and the amount of salary payable was arrived at
converting the basic Turkish gold pound of salary into pound sterling
multiplying them
the factor 100 and then converting the number of sterling so arrived at into Turkish paper pounds at the average rate of exchange for sterling for the three months preceding. So long as this procedure was followed the employees were being paid in the gold equivalent of their salaries.
a decision of the Managing Committee dated 18th May, 1921, the rate of the pound sterling for the payment of salaries for May and June was fixed at 451. It is evident from the preceding exhibit that the rate fixed for sterling was appreciably less than the real rate, and therefore in May, 1921, employees for the first time received less than the gold equivalent of their salaries. In August, 1923, the appellant Bank began to pay salaries, upon a new principle, that is
Omitting the intermediate step of converting the basic Turkish pound of salary into sterling, and paying in Turkish paper pounds the number arrived at
multiplying the "basic Turkish pounds" of salary
4.
the Court as what was the Turkish pound referred to in appellant's letter of 29th September, 1931, (Exh. A.D. 7) as "Ltques at 110" counsel for the appellant said : "There is no Turkish pound that bears to the English gold pound the relation of 110 to 100 other than the Turkish gold pound." Appellant'sclaim that the ratio of 110 to 100 is a conventional ratio is contradicted
the evidence of Mr. Jones,
the statements of the Bank's counsel in the argument before this Court, and
the evidence given in Chakarian Case and Esmerian Case. This claim further is definitely disproved
evidence which the learned trial Judge accepted as correct-evidence which was not cross-examined upon-that the ratio of 110 to 100 is a real ratio between the Turkish gold pound and the English sovereign in that it expresses the respective weights of the two gold coins, and the Court has made a finding of fact to this effect. The evidence thus shows that there was an express agreement between the parties that the Ltqs. 45 of salary were gold pounds, as the Court below has found. Appellant greed in his letter (Exh. A.D. 7) to pay respondent a monthly pension of "Ltques 28.80 ? 110 =Lstg. 26.3.8." Counsel for the Bank definitely admitted-and in face of evidence he could not do otherwise-that the only Turkish pound bearing the ratio to the English sovereign of 110 to 100 was the Turkish gold pound-a fact which is proved beyond all doubt
the evidence. The inference of necessity to be drawn from counsel's admission is that the appellant has agreed that the "Ltques 28.80" of pension are gold pounds. Notwithstanding this counsel contends that the Privy Council decided in Chakarian v. The Ottoman Bank that the salary was not gold. The issue raised in that case was whether or not the plaintiff had been wrongfully dismissed. After finding on the main issue that the decision of the lower Court was correct the judgment states that it agrees with the view of the Supreme Court "both as to the measure of damages and the basis on which- for that purpose-the pension to which the respondent would have been entitled is to be calculated." The only alteration made is to substitute the proper date in accordance with the Pensions Regulations on which the pension is to be calculated, and further that the rate of exchange to be taken for conversion of the pension into sterling is the rate at the late of dismissal. As I understand Lord Thankerton's judgment it expresses no opinion upon the question of whether or not the salaries are payable on a gold basis. The facts in the present case are quite different from those in Chakarian Case, and any finding
the Privy Council upon quite dissimilar facts would not be binding on this Court. The question of fact to he decided in this case is as to the meaning to he placed upon the term "Ltques at 110", which the appellant uses to define the Turkish pounds lie admits liability to pay respondent as pension. A decision of the Privy Council on other facts, even if there were such a decision, would not preclude the trial Court frommaking a finding upon quite different facts. On this point I would refer to the Esmerian Case in which both the trial Judges held that the pounds Turkish of salary are gold pounds, and they assessed damages upon this basis. This judgment was upheld on appeal, at the hearing of which decision of the Privy Council in Chakarian Case was cited. If the appellant Bank had considered that the Privy Council had decided that salaries were not payable upon a gold basis, they were bound to succeed on an appeal, to the Privy Council in having the damages substantially reduced, as having been assessed upon a wrong principle. The appellant Bank, however, did not think fit to appeal, or rather, abandoned its appeal after obtaining conditional leave. It is important to bear in mind that in whatever manner pensions are paid
the appellants they must be the same for all their employees. I will cite the view I expressed on this point in the Esmerian ease, the file of which is
agreement of the parties before the Court on this appeal. "This 'Capital Fund' (the Pension Fund) was provided
the Bank when the fund was constituted in Turkish pounds, worth 18s sterling, in other words, pounds gold. The contributions, both
the employees and the Bank, before, during and after the War, have always been in gold, as they are at present. Mention is made in the evidence of an officer of the Bank retiring in Cyprus and being paid his pension in sterling. This confirms the view that the pension scheme is one and must be the same for all employees of the Bank irrespective of where they perform their service. There being one fund for all the employees of the Bank, of which the capital and the contributions are gold, there can be only one mode of calculation of pension, viz., in the same species of money as the Fund and its contributions." The exhibits produced show that the contributions to the Pension Fund are made
deduction from the salary in basic Turkish pounds and not from the amount in paper actually paid to the employee. The appellant is, therefore, obliged to argue that pounds Turkish (Ltques), in which all salaries have always been expressed in the Bank's books, means Turkish gold pounds as regards deductions for the Pension Fund, but paper pounds as regards salaries and pensions. Mr. Jones has stated that respondent's salary of Ltques 45 could be paid in paper pounds (worth about one-tenth of the gold pound). No attempt was made to prove this allegation. Counsel in argument made a similar submission that if the Turkish pound became worth only one penny the Bank could discharge its obligation to respondent
paying him 45 pound notes worth one penny each in English currency. If the appellant were of opinionthat he could discharge his obligation to respondent
paying him a monthly pension of 28.80 pounds paper it is surprising that he should have admitted liability to pay a pension ten times greater than he is obliged
law to pay. The appellant is in a serious dilemma if the "Ltqs" of salary are not gold pounds they must be Turkish paper pounds, for these are the only two kinds of pounds existing in Turkish currency. They cannot possibly be paper pounds because 28.80 of such pounds are not equivalent to £26.3.8 sterling, but only to about £2.10.0 sterling. There is no intermediate pound lying between the gold pound and the paper pound. The appellant Bank in its letter (Exh. A.D. 7) has defined the pounds of pension which they admit the liability to pay, i.e., "Ltques at 110."
the very terms of this definition paper pounds are excluded. The only pound remaining which can come within the definition is the gold pound. In my opinion all the evidence at the trial and the evidence in the two other cases which are before the Court on this appeal all lead to one conclusion and that is that the salaries of the employees of the appellant Bank invariably shown in the bank's books as " Ltqs "are Turkish gold pounds. Appellant's obligation being to pay the respondent a certain number of Turkish gold pounds per month it remains to consider how such obligation can be discharged for the purposes of a judgment inCyprus. Counsel for the respondent submits that there is a contract expressed in foreign currency and, whatever debt is created, it must be paid in local currency at the actual rate of exchange when the debt becomes due; that is to say, so many pounds in Cyprus currency should be given to the plaintiff to enable him to buy the foreign currency due to him, as if it were a commodity. In the ease of Di Fernando v. Simon, Smits and Co., Ltd. the Court held that, where damages for a breach of contract are fixed in a foreign currency, for the purposes of a judgment of an English Court those damages must he translated into English currency at the rate of exchange prevailing at the date of the breach. In Barry v. van denHurkBailhache, J., expresses the same view saying "the damages must be fixed as at the date of default, and therefore the sum to be awarded as damages is such a sum in English currency as would at the rate of exchange prevailing at the date of default produce the sum n foreign currency." In the S.S. Celia v. S.S. Volturno the House of Lords follow the decision of Di Fernando v. Simon, Smits and Co., Ltd. Lord Buckrnaster and Lord Parmoor each cite with approval the following passage from the judgment of Vaughan Williams, L.J., in Manners v. Pearson : "It seems plain that his mode of computing the value of foreign currency in English sterling, and thus converting the one currency into the other, is based upon the damages for the breach of contract to deliver the commodity bargained for at the appointed time and place, and, if this is so, it follows that the date as of which the value must be ascertained is the date of the breach, and not the date of the judgment." These authorities establish now beyond any doubt that where a person has a judgment for a debt in a foreign currency the Court will order payment to be made in so much local currency as will purchase the foreign currency on the date the debt is payable. The decision appealed from being as to the meaning of the contract between the parties, and thus purely a question of fact, the appellant Bank could only succeed if it established that the decision was such as could not reasonably have been arrived at upon the evidence. This the appellant has entirely failed to do. I fully concur with the conclusions arrived at
the learned trial Judge-conclusions that are amply supported
the facts proved in evidence. For the reasons I have stated I am of opinion that this appeal should be dismissed with costs, and the cross-appeal dismissed without costs. SERTSIOS, J.: This is an appeal from a judgment of the Divisional Court, Nicosia, whereby the defendant Bank was adjudged to pay the plaintiff: (
which he was informed that
order of the General Management he was to be retired on pension as from 1st January,
the General Management. The defendant Bank
a letter of the General Management refused to pay any attention to his claim. Hence the present action. Coming now to the first ground of appeal, with which I propose to deal, counsel for the appellant Bank argued in this Court that "the plaintiff used to get 45 Turkish pounds basic, that this would be either 45 Turkish paper pounds or what was legal tender for the payment of 45 Turkish pounds to the plaintiff." He, furthermore, argued that in the year 1922 the legal tender was the paper pound, and one could pay plaintiff only 45 Turkish pounds paper. According to plaintiff's evidence, while at the head office at Constantinople at that time, he was drawing £27 sterling, a supposed equivalent to his salary of 45 Turkish pounds and not £6 as he would, if Mr. Clerides' argument were correct. The defendant Bank obviously did not even ever dream of acting in accordance with Mr. Clerides' theory. It would appear, however, that owing to the rapid depreciation of the Turkish paper pound, the Bank itself fixed a rate, which was not the actual and real rate of exchange. According to plaintiff the actual rate of exchange at that time was 7.85 paper Turkish pounds for an English pound. Now, before discussing the points raised in the grounds of this appeal, I consider it necessary to deal first shortly with the evidence of some of the main witnesses in the case. Plaintiff in his evidence stated that he called his salary gold because it was always calculated at 110 to 100, which is the ratio of Turkish and English gold pounds; he further stated that this ratio of 110 to 100 was a reality and not conventional, as contended for the defendant Bank, because this calculation of 110 to 100 is based on different weights of two gold coins. He added that this ratio of 110 to 100 was the parity between the two pounds, and that he received his salary on this basis, which represented actual relative values. Plaintiff's witness, OhanesChakarian, stated in evidence that after January, 1921, in Turkey they got such salary as would enable them to convert on the day of payment into money which would buy equivalent of their salary in gold, but that in May and June the Bank stoppedthis method and the employees protested. This remains uncontradicted. So the salaries were received
the employees under protest. Now this equally applies to plaintiff (respondent), who said that the Bank had fixed the rate, and his salary of 45 Turkish pounds was thus reduced to £27-they would be equivalent of his salary in sterling. The same witness Chakarian said in evidence that, when he came over to Cyprus in May, 1923, the relation of 110 to 100 was a real one. According to the evidence of these two witnesses, i.e., the plaintiff and Chakarian, the salary of the employees of the Bank was calculated at 110 to 100, and that was the ratio of the Turkish and English gold pounds, 110 Turkish gold pounds being the equivalent 100 English gold pounds. Referring to the same point the Regional Manager of the Ottoman Bank in Cyprus, stated in evidence that the defendant Bank in Cyprus pays its employees at the rate of 110 to 100, which is a conventional rate. But further below on same page made the following statement: "When plaintiff came to Cyprus we were working on 110 to 100, which was not the real rate but the legal rate!" he calls it first a conventional rate and then a legal rate. I don't know what he meant, when in this way he described the rate, but one thing is quite clear, that the counsel for the defendant Bank, addressing this Court, said distinctly that the ratio of 110 to 100 is a conventional ratio, and when asked to say what he meant
this expression, he said that conventional ratio is a ratio agreed to between the Bank and the employees. The witness for defendant Bank, Mr. Jones, said, further, the following: "The basis of payment of salaries and pensions is gold, but I say the fixed ratio is 110 to 100. This is a conventional ratio." So the witness calls it this time a conventional ratio only Later, however, Mr. Jones, dealing with the very same subject, stated that the 110 to 100 is the parity between Turkish gold pound and English sovereign, and he, further, gave quite an accurate definition of the expression,"parity" as follows: "Parity is the value of the gold in coin of one country in relation to that of another." No doubt that the latter opinion of Mr. Jones as to ratio is sound and correct. Indeed, the ratio represents relative weights of the same matter. Therefore, it cannot be the subject of variation
agreement, namely conventional. How can it be conventional, when it expresses the relation that exists in fact? Consequently the figure 110 cannot be anything else but Turkish pounds gold, corresponding to £100 which represents sovereigns according to the evidence of the same witness. The same witness, Mr. Jones, stated that the defendant Bank is a Turkish Bank, and all its contracts are drafted in Turkish pounds; also that the plaintiff's salary as that of other officials is fixed on Turkish pounds, and, his pension alsois fixed on Turkish pounds. Consequently the defendant Bank's obligation is to pay his pension in Turkish, pounds under the contract. As a matter of fact the Direction G?neral? of the defendant Bank
a letter dated the 17th September, 1931, informed the plaintiff that, as from the 1st January, 1932, he was to be retired on pension, and that the pension payable to him was on the following basis: "Ltques 28.80 at 110==£st. 26.3.8." So plaintiff's pension was fixed at 28.80 Turkish pounds, at the rate of 110 to 100. I have already stated that from the evidence adduced it is quite clear that the figure 110 is unquestionably with reference to gold. That being so, plaintiff's salary of 45 Turkish pounds must be 45 Turkish pounds gold, and necessarily his pension being the 64% of such salary must be gold. But, even assuming that plaintiff's salary was not gold, his pension must be in gold on another ground. Mr. Jones said that the Pension Fund, referred to in the Regulations, is a separate fund, and that the contributions to it are contributed in parity of 110 to 100
the employees of the Bank. Namely, in other words, the contributions so paid
the employees of the Bank are in gold. It clearly follows that the pension which must be paid out of such Pension Fund must be in gold. To strengthen this view, however, let me deal with some other parts of Mr. Jones's evidence. Mr. Jones said that in the contract of the, plaintiff the pound referred to may have been the gold pound or paper pound. But plaintiff joined the Bank in the year 1905, when the only pound existing was the Turkish pound gold, a fact of which Mr. Jones must certainly have been cognisant. How then could the pound referred to in plaintiff's contract have been a Turkish paper pound? The paper Turkish pound, as a fact, was unknown in Turkey prior to the promulgation of the paper currency Law in the year 1915. Again Mr. Jones stated that, if plaintiff had 45 pounds per month, it was worth 45 Turkish pounds paper money according to Law in Turkey. But, according to plaintiff's evidence, the 45 pounds paper money was approximately equal to £6 only. If so, why the defendant Bank should have paid plaintiff £40 in sterling as an equivalent of 45 paper Turkish pounds? This is an impossible proposition. Mr. Jones in his evidence also said that on the 5th October, 1931, plaintiff wrote a letter to him in which he was raising the points he has raised in this action. He referred the matter to the Direction G?n?rale and communicated their reply to the plaintiff. In the reply in question, being clearly of an evasive nature, they said that plaintiff's claims were contrary to the Regulations. But Mr. Jones quite rightly, when asked, replied that there is nothing in the Regulations as to these points. So far, I think, I have sufficiently dealt with the main parts of the evidence of the Regional Manager of the defendant Bank, Mr. Jones. Now I come back to some points raised
counsel for defence in this Court. Mr. Clerides argued, inter alia, that, even if there was an express agreement between the plaintiff and the defendant Bank that his pension should be £26.3.8. sovereigns the Bank could pay him the same amount in currency notes. But
the agreement based upon the Regulations what the defendant Bank is bound to pay the plaintiff is not the amount of £26.3.8, but that of 28.80 Turkish pounds gold. And to pay it, they must pay its equivalent in Cyprus currency notes at the rate of exchange existing on the day on which the amount of the monthly pension of the plaintiff becomes due and payable, inasmuch as our Courts in the Colony have no power to order payment except in local currency. Consequently the case In re Soei?t?Intercommunale Beige in 49 T.L.R. 8, cited
Mr. Clerides, is not applicable to the present case. But the case of Soci?t? des Hotels Du Touquet-Paris-Plage v. Cumming is applicable. In the case Manners v. Pearson and Bon Vaughan Williams, L.J., although he had delivered a dissenting judgment, did not as regards the principle concerning the rate of exchange differ from the rest of the Court. He explained his view as follows :- "It seems clear that in an action in whatever form in English Courts for the recovery of a debt in a foreign currency the amount of the English judgment or order must be expressed in English currency, and that the amount of the English judgment or order must be based on the quantity of English sterling which one would have to pay here to obtain in the market the amount of the debt payable in foreign currency, namely, the amount payable, according to the rate of exchange." Mr. Jones must have been cognisant of the principle stated
Vaughan Williams, L.J., when he said that with £26.3.8 Cyprus currency notes offered
the Bank, plaintiff could not buy 28.80 Turkish gold pounds. Counsel for defendant Bank insisted on saying in this Court that the ratio of 110 to 100 was a conventional one, between the Bank and its employees. But in answer to a question put to him
the Chief Justice on this point, he admitted that outside the Bank any one would obtain for 110 Turkish pounds gold 100 English pounds sterling. He thus in effect admitted that the relation was not conventional but a real one, which is directly contrary to his submission, for which he so strenuously contended throughout the appeal. I have forgotten to say that Mr. Jonesstated in evidence that after January, 1932, there was a free market for gold in Cyprus, as there was in England, the sovereign in such free market being worth 23s. about. Consequently his statement that one paper pound sterling is equal to a sovereign, is contrary to fact. Counsel for the defendant Bank replying to a question from the Bench said the following: "There is no Turkish pound that bears the relation to the English gold pound of 110 to 100 other than the Turkish gold pound." But, what was the plaintiff's salary which was treated as the basis upon which the amount of the pension payable to him had been calculated? Both parties agree that the plaintiff is entitled to receive as pension 64% of the salary he was drawing on the 31st December, 1930. This pension the Bank state in their letter amounts to "Ltques 28.80 at 110" that is to say £26.3.8 in pounds. As, however, the Cyprus pound, in the same way as the English sterling, was on the date in question, i.e., on the 31st December, 1930, on the gold basis, unquestionably the £26.3.8 are pounds sterling gold. Consequently, the pension having been fixed on the 31st December, 1930, as £26.3.8 gold, it must continue to be so paid irrespective of what may happen to English or Turkish currency after the 31st December, 1930. Apart from this, the decision fixing the plaintiff's pension was taken
the General Management on the 17th September, 1931, when sterling was still gold. Therefore, the sum of £26.3 .8 fixed
the General Management are gold pounds. No fall of sterling was contemplated on that day. Counsel for defendant Bank also argued in this Court that the Privy Council's decision in Chakarian's ease governs the present case. The Privy Council, however,
their judgment showed that they never for one moment accepted appellant's contention that the Bank could discharge its obligations
paying one Turkish pound paper for each basic pound of salary, with which basic pound I propose to deal later. It is more than likely that the Bank's counsel at the hearing before the Judicial Committee showed the same common sense as the Bank's counsel did at the trial of that case before the District Court, where Mr. Ronald Smith said that he was unable to support such contention. I may perhaps deal with another point of plaintiff's evidence with reference to the salaries being paid on a gold basis
the defendant Bank. Plaintiff stated in evidence that on the 31st December, 1930, he had received his month's salary in money equivalent to gold. This stands uncontradicted. It is a fact that on the 31st December, 1930, the pound sterling, and so the Cyprus paper pound note, was on the -gold standard.Consequently, 110 Turkish pounds was equivalent to £100 sovereigns. The ratio was then, as always, 110 to 100. If 110 Turkish pounds were equal to 100 sovereigns, i.e., gold, certainly the 110 was gold, as the rate of 110 to 100 was the parity between the English gold coin and the Turkish gold pound. It would be ridiculous to contend that the figure 110 was with reference to Turkish paper pounds, being well known that 110 Turkish paper pounds at that time were hardly equivalent to £11 sterling. Therefore, on the 31st December, 1930, when plaintiff drew his salary for the month, the 110 Turkish pounds should of necessity have meant 110 Turkish pounds gold. So the salary which plaintiff received at that date was money equivalent to gold, as he himself rightly stated in evidence. Counsel for defendant Bank arguing in this Court said that in the same way the Government of Cyprus, even, if the £1 currency note be depreciated, will pay the salaries to its employees in currency notes of £1 each. The Government of Cyprus, however, dealing with its own monetary unit, has got the power to do so and say, as it were ex composito or κατά συνθήκην, that a gold sovereign shall be equal to £1 currency note. But what power such Government can have to adopt the same course in dealing with foreign money? How can the Government of Cyprus interfere with the monetary unit of a foreign country, e.g., Turkey, and say that one Turkish pound gold is equal to one Cyprus currency note?
what international authority or any other legal means could the Government of Cyprus, without manifestly violating what we know as the comity of nations, oblige the holder, say, of 50 Turkish pounds gold to sell same in Cyprus fo £50 Cyprus currency notes of one pound each, being well known that such Cyprus currency note or English sterling is off the gold standard and that the Turkish gold pound is higher in value
3s. or 4s. according to Mr. Jones's evidence t According to Mr. Jones both in England and Cyprus there was a free market for gold, as I, have stated above, notwithstanding the existence of various orders and proclamations
virtue of which currency notes had become a legal tender. The Government is in a position to make any conventions regarding currency, and such conventions are binding on all its subjects, inasmuch as the Government conventions have the force of law, if so made to have. But other conventions would be binding only upon the parties to the convention. Counsel for the defendant Bank dealing with paragraph 1 (a) of appellant's grounds of appeal, argued that there was no express agreement that plaintiff's salary should be 45 Turkish pounds gold. But plaintiff joined the Bank inthe year 1905, when there was but one legal tender in Turkey, namely the Turkish gold pound. The same counsel arguing in this Court stated that the plaintiff's salary right up to the year 1915 was admittedly in gold. What other express agreement then is required?
paragraph 1 (b) of the grounds of appeal it is, further, admitted that even right up to the year 1921, in spite of the promulgation of the currency Law in Turkey in the year 1915, plaintiff was receiving his salary in gold. This is quite clear because the said ground of appeal reads: "Plaintiff from 1921 to February, 1923, when he was serving in Turkey was not receiving his salary in Turkish pounds gold, nor in a sum equivalent to Turkish pounds gold." As to the period of 1921 to 1923, plaintiff has already given an explanation, having said that the Bank had itself then fixed its own rate, in consequence of which he was drawing during the period in question only £27 sterling a month, the would-be equivalent of his salary of 45 Turkish pounds gold. The witness for plaintiff Mr. Chakarian stated in evidence, as I have already mentioned, that all the Bank officials duly protested against this arbitrary fixing of the rate of exchange. From Exh. A.H.R. 5, namely, a decision No. 12 of the General Management appearing on p. 93 of the "Record", it is clear that from July to September, 1920, the salaries of the staff were being paid on the average of the selling rate of the pound sterling registered at the Head Office during the three months April to June, and that that rate worked out at 451 piastres for sterling. So the actual rate of exchange at that time for sterling was 451. piastres. But from an extract from Minutes No. 17 of the Management Committee, dated the 18th May, 1921, I notice that the mode of payment of the staff salary was changed, and the salaries for May and June, 1921, were no longer being paid on the average of the selling rate of the pound sterling, but at the rate of 451 piastres the pound sterling for basic salaries up to £tqs. 55, which rate was fixed
the Bank regardless of what the average of the selling rate of the pound sterling was. This last decision was maintained in force up to the 27th August, 1923, when another rate 410 piastres for sterling was applied. There is nothing, however, in evidence to show what was the real rate of exchange from May and June, 1921, to August,
thedefendant Bank. From the foregoing I can rightly gather that the arbitrary rate in question so fixed
the Bank was the one of 451 piastres for sterling, as against which Bank officials protested, as stated above, and never consented to it. Counsel for defendant Bank said that plaintiff used to get 45 Turkish pounds basic, and that this would be either 45 Turkish pounds paper or what was a legal tender for the payment of 45 Turkish pounds to the plaintiff. But this is an inconsistent and unintelligible statement. If a basic pound means a paper pound why should they not have called it so, and why they have not offered the plaintiff 28.80 paper pounds Turkish as his pension, that is to say in sterling between £2 and £3 approximately, in place of the £26.3.8, which they agree he is entitled to? From all the material before the Court in this appeal it is abundantly clear that there is the widest divergence between the basic pound and the Turkish paper pound. (See decision of the General Management dated the 27th August, 1923, on p. 95 of the Record). In the case of Esmerian v. Ottoman Bank I stated the following as to the "basic" pound: "The decision of August, 1923, states, inter alia, the following: 'The basic Turkish pound will be converted into paper in accordance with the co-efficient 4.1. But in order to convert the basic Turkish pound into paper, it must be something other than paper, because a paper currency cannot possibly be converted into paper. One thing can only be converted into another thing of a different nature or genus. Money can only be converted from one kind to another. Consequently, this something, which is to be converted into paper, can only be gold. That the basic Turkish pound, therefore, referred to in the decision of August, 1923, means the gold pound cannot be open to doubt.'" It is, therefore, very surprising indeed that such a clear distinction between the two expressions should have escaped the attention of the learned counsel for the defendant Bank. The case of Esmerian v. Ottoman Bank, which has been treated
consent as an exhibit in this case, was an action for wrongful dismissal. For the purpose of establishing the amount of damages to which, in my opinion, the plaintiff in that case was entitled, I dealt with the question of the rate of exchange, at which he was being paid his salary, at a great length. I will read some other passages from my judgment in that case, which have a direct bearing on the point under consideration in the present case. I am reading from pp. 19, 20, 21 and 22 of my judgment as follows: "'The actual paper pound and the basic pound of salary having become so different in value, the Direction Generale makes in February, 1920, an important decision,made undoubtedly with the sole object of maintaining the true nature of the salaries of all its officers, viz., the Turkish gold pounds.' "Decision No. 13,022. "
decision of the General Management: "The salaries of the staff in Constantinople and of the Agencies in Turkey, actually profiting
the percentages and the allowances, will henceforth be payable in the following manner: As from the 15th January, 1920, the gross monthly salary of each employee will be converted into pounds sterling at the rate of 110 Turkish pounds for 100 pounds sterling and the proceeds of conversion so obtained will be paid to each employee in Ottoman Treasury notes at the average selling rate of the pound sterling during the three months immediately preceding the current month. "For example an employee whose monthly salary was £tq. 55, would receive 55x100/110 = £50 sterling. If the rate of exchange for sterling was 451 piastres, as it was, for example, in January, 1920, the salary actually received would be 50 x 451 =22,550 piastres, or. 225.50 Turkish paper pound notes. This method of paying salaries was continued up to August, 1923, when the Direction G?n?rale make the following decision (see Exh. A.E. 3): "'Salaries of the Constantinople staff for the month of August will be paid in Turkish paper pounds on the following basis: The basic Turkish pound will be converted into paper in accordance with the, co-efficient 4.1, or at the rate of 410 piastres paper for Turkish pound of salary.' "This is in effect equivalent to the last rule fixed for sterling
the Direction G?n?rale in May, 1921, viz., 451 piastres. The first thing to note about the decision is that it omits all reference to sterling, and secondly that the rate chosen
the Direction G?n?rale was not the true exchange rate. The Turkish paper pound was continuing its downwards flight, and this, to my mind, was the reason of the decision. The Direction G?n?rale was unwilling to keep pace with the rapid descent of the Turkish pound and pay 500, 600 or 700 piastres for each £ sterling of salary. The rate of 410 piastres was much less than the exchange value. It is to be noted that the employees in Constantinople did not agree to this arbitrary fixing of the rate for the Turkish gold pounds, but they had either to accept it or resign. "It is necessary to point out that this decision only refers to employees in Turkey. Employees in Egypt and Cyprus continue to have their salaries paid on a sterling basis in the manner provided in January, 1920. It is material to examine carefully the words of the last decision, more especially when it is remembered that the Bank claims that salaries are payable only in paper. The learnedcounsel for the defendant Bank in the last paragraph of his address for the defendant states: The Bank would have been justified in paying plaintiff's salary
giving him 55 one pound Turkish notes, as such paper notes were legal tender
law. "The law referred to
the counsel is in evidence and contained in Exh. A.E. 3, Article 3 of the law in question is as follows :- "'The equivalent value of these notes shall be repaid in gold at sight or to bearer, six months after the conclusion of peace, at Constantinople.' "From the above it appears that paper notes were to be legal tender up to a date of six months after peace, when they became redeemable in gold. There is nothing in evidence to show that that law had subsequently been altered, and that, consequently, the paper notes continued to be legal tender even after the date fixed
the law. Have the parties consented to the substitution of the basic gold salary which was the only one under contemplation? There being no evidence before the Court of any consent on the part of the employees or of any intimation from the Direction G?n?rale to the staff, I pass to consider whether the Bank has the right to change such a fundamental term of the contract. "The first thing to note is that this decision governs only the employees in Turkey. It is in evidence uncontradicted and not cross-examined upon that the employees outside Turkey are paid on the gold basis as all employees of the Bank were up to the time of introducing the paper currency in Turkey. The plaintiff states that had he been transferred to Cyprus his salary of £tq. 55 would be £50 sterling 55x100/100. From this it follows that the decision does not purport to modify the contract of service for all servants of the Bank. It merely attempts to do so for those engaged in a country whose currency has become about one-ninth of, its gold value, or, to put it another way, the Direction G?n?rale did not decide (and the reasons why are obvious) that all its employees would in future be paid 410/920 of their salaries. This would have had the effect of reducing
half the salaries of all the Bank's officers in countries where the currency is on a gold parity. To enforce such an order would probably have left the Bank without any staff to carry on its business. "It is thus clear that the terms of the contract of service 'La Caisse de Pensions et de Retraites' are maintained in their full vigour in the case of all employees of the Bank in places where the currency is not depreciated. "It should be noted that there is one Caisse de Pensions, a common fund into which all the staff of the Bank contribute equally. The contributions are made in gold and are5% of each officer's salary. It is in the nature of capital and must, therefore, exist in gold. The Bank undertakes to supplement this Fund, if it is not sufficient to pay the pensions. (See Article 9 of 'Caisse de Pensions et de Retraites'.) If, however, the Fund was not sufficient to the calls upon it, and the Bank did not want to supplement the Fund out of dividends, it had a perfect right to terminate the employment of as many of its officers as it wished (vide Article 2 of 'Caisse de Pensions et de Retraites '), but it could only do so upon the terms laid down in the contract, viz., Article 21, but it has not the right without the consent of the employees to vary such a fundamental term of the contract. "Chapter III of the 'Caisse de Pensions' states that all employees will contribute to the Pension Fund 'le 4% de leurtraitement fixe;' and further that the amount of the pension will be calculated upon the basis of 'du traitement free annuel.' "Before the introduction of a paper currency in Turkey employees were paid a 'fixed salary', but once this money began its downward career, the salaries paid in it were changed from month to month and could not be described as 'fixed'. One thing remains 'fixe', and that was the basic salary in Turkish pounds which kept its gold parity. "This is another reason to show that in the contemplation of the contracting parties the salaries to be paid were to be fixed salaries on a gold basis, and consequently that payment in a currency which changed, from month to month was not in accordance with the 'Caisse de Pensions et de Retraites', Article 9. "While maintaining the payment of salaries and pensions on a gold basis in accordance with the Caisse de Pensions et de Retraites in the case of employees outside Turkey, the Bank's attempt to substitute another currency for payment of its staff in Turkey is contrary to Article 30 of the Caisse de 'Pensions. et de Retraites, which' reads: 'La Direction G?n?rale se reserve le droit de modifier le present R?gl?menttoutes les foisquelle le jugeranecessaire et en tantque les droitsouinterets du personnel ne Se trouveront pas leses par ces modifications.' "It is obvious from this Article that the Bank's right to modify the terms of the contract between itself and the employees is expressly limited to those modifications in so far as they do not injure the rights or interests of the staff. "The variation of a fundamental term of the contract which the decision of 27th August, 1923, attempts to carry out, could have results disastrous to the employees. Take the case referred to
the plaintiff (see notes of evidence on p. 10.) of an officer retiring in Cyprus and being paid his pension in sterling. If this officer had been transferred toTurkey shortly before being placed on pension, his employers could reduce his pension to half its value. This could be done to any employee on the eve of retirement, and the Pension Fund, consequently, would enjoy material relief. "Once it is conceded, as is claimed
the Bank, that it has the right to fix the number of piastres it will pay for each 'basic Turkish pound' of salary, it follows logically that it can fix any number it pleases. It has fixed 410 which bears no relation to the then exchange value of the 'basic Turkish pound.' It could likewise fix 200 or 100, as it thought fit. It may be said that, if the rate were reduced to such an extent, the Bank would remain without staff, and would be obliged to close its doors. This may be so but this alleged right to vary the contract can only be tested if pushed to its logical conclusions. Once admit there is a right to substitute for gold a payment in paper, the Bank can fix any rate caprice may dictate. "For all the reasons set out above it is, in my opinion, beyond any doubt established that the unjust and arbitrary attempt of the Bank to alter a fundamental term of the contract in the case of its employees in Turkey is a flagrant breach of the Caisse de Pensions et de Retraites and is without a shadow of right. I am clearly of the opinion that according to the contract the 'Caisse de Pensions et de Retraites' salaries must be paid on a gold basis." From the passages I have just read from my judgment it is quite clear, in my view, that according to the "Caisse de Pensions et de Retraites" which is the contract between the parties, salaries to Bank officials ought to be paid on a gold basis. Working on that basis I adjudged the defendant Bank in the case mentioned to pay the plaintiff the amount of £3,000 damages. My brother Judge, with whom I sat at the hearing of the case, likewise held that damages should he assessed upon the basis of plaintiff's salary being payable in Turkish pounds gold. The defendant Bank appealed to the Court of Appeal of this Colony against this judgment, but the appeal was dismissed. The President of the Court of Appeal, however, in his judgment stated that one of the trial Judges decided in that case that plaintiff was entitled to damages on the basis of his salary being payable in gold. In this the learned Chief Justice was mistaken-both the Judges, before whom the case was heard, so decided as I have already mentioned. Though notice of appeal to the Privy Council against that judgment was lodged, the appeal was not proceeded with. Consequently that judgment holds good. From the foregoing it follows that the plaintiff's salary was undoubtedly 45 Turkish gold pounds, such being the agreement between the parties under the contract known as "Caisse de Pensions et de Retraites," apart from the evidence before the trial Court which amply corroborates this view, as explained already at length. Thus, in my view, the defendant Bank must fail on Clauses 1 and 1 (a) of grounds of appeal, and for the reasons equally explained at some length above, they must also fail on the Clause 1 (b) of grounds of appeal. Now Clause 1 (c) of the grounds of appeal reads :- "From February, 1923, up to the year 1925, and from September, 1931, to 31st December, 1931, during which periods the sterling was off the gold standard, plaintiff was receiving his salary not in gold or in equivalent to gold." As regards the point in connection with the period from February, 1923, up to the year 1925, it was strenuously argued
the counsel for the appellant Bank that plaintiff (respondent) during that time was not receiving his salary in Turkish pounds gold. He contended that the suggestion of the plaintiff (respondent) that paper currency in Cyprus then was of the same value as gold, according to a Proclamation in the Cyprus Gazette, was wrong. A careful examination, however, of the various Orders in Council, with regard to currency in Cyprus, shows that the argument of the appellants is not sound. In Section 2 of the Proclamation, cited as the Currency Proclamation, 1917, it is laid down that "the currency notes of £10, £1 and 10s. respectively, to be issued
the Currency Commissioner, shall be redeemed at the expiration of 18 months of the termination of the present war or before that date, should the Government so desire." This Proclamation was later amended
Order in Council dated the 31st January, 1923, as follows:- "The notes for the value of £10, £1 and 10s. issued under the provisions of the Proclamation dated the 5th September, 1917, and published in the Cyprus Gazette, dated the 10th day of September, 1917, shall continue to be current and legal tender for a further period from 1st day of March, 1923, until the 31st of August, 1924." It will thus be seen that the provision in Section 2 of Currency Proclamation, 1917, has not in any way been amended, and has remained in full force and effect. It follows that in the notes issued in pursuance of those orders there is an obligation to redeem them in gold at the expiration of 18 months from the termination of the War. Now
a Proclamation under the hand of the Governor, dated the 31st day of August, 1921, it is provided that "the 31st August, 1921, shall be taken to be the date and time ofthe termination of the present war, provided, however, that nothing herein ordered and proclaimed as aforesaid shall be taken to affect relations between His Majesty and the Ottoman Empire, until ratifications of a treaty of peace with that Empire shall have been exchanged or deposited." The war, however, with Turkey was part and parcel of the Great War, and this part of the war was not terminated until the date when a Proclamation to this effect, under the hand of the Governor, was published on p. 27 of the Cyprus Gazette, 1924, providing as follows:- "The 6th day of August, 1924, shall be taken to be the date of the termination of the war with Turkey." In effect
the termination of the war with Turkey the whole war was terminated, especially so in respect of a country, like Cyprus, where the interests of an enemy Corporation like the Ottoman Bank were involved. (See War and Treaty Legislation
J. W. Scobell Armstrong, on p. 210 et seq.). The effect of this is to make the above mentioned currency orders redeemable in gold at the expiration of 18 months from the 6th August,
the appellant Bank. Indeed, what then interested plaintiff vitally, according to his own evidence, was his pension, upon which alone for the rest of his life he had to depend, and not the four months' salary, and I quite agree with him. The above disposes of Clause 1 (c) of the grounds of appeal. As regards grounds 2 and 3 of appeal, those also have been disposed of, as a matter of course, inasmuch as they entirely depend upon the answer to the 1st ground of appeal. The only remaining thing now that calls for the decision of this Court is plaintiff's cross-appeal on the point that his monthly salary of £4, described as salary in form of indemnity, should equally be treated as pensionable. It would appear, however, that the only salary considered as pensionable is the one described in the Regulations as "annual fixed salary." (Vide Articles 9 and 15 thereof). An increase of salary in form of indemnity presumably ought to be added to the salary known as "fixed" and thus become an inseparable part of it, i.e., fixed as the original salary. Still the appellant Bank has chosen to call it an increase of salary in form of indemnity, and in the salary book they have made it appear in the column under the heading "Indemnity", and not under that of "Salary ", obviously thus intending to draw a distinction between the two terms, i.e., a "salary" and an "increase of salary in form of indemnity." Plaintiff, though in control of all the books of the defendant Bank, does not seem to have ever been impressed
this peculiar description. He never even had the curiosity of enquiring and asking for some explanation from the General Management as to the object of this distinction. He, therefore, must be taken to have agreed and consented to this distinction between "salary " and an "increase in form of indemnity", and cannot now contend that the indemnity was part of his salary for the purpose of his pension. Moreover, in Articles 9 and 15 of the Regulations it is clearly laid down that the "fixed salary" of a Bank official is only pensionable, and not an "indemnity."Plaintiff himself
his conduct seems to have clearly understood that the increase in form of indemnity was not in the nature of an ordinary increment, as provided
the Regulations. Plaintiff, further, knew full well that under Article 9, paragraph 2, of the Pension Regulations he was bound to cede to the defendant Bank in full proprietorship 5% of his salary and the half during one year of any increment he was receiving. He knew very well that all such sums were regularly retained
the Bank and lodged into the account of the "Pension and Superannuation Fund" for the purposes of pensions. Though well aware of all these requirements of his contract, he complied only with the requirement of Article 9, paragraph 1, but never with, paragraph 2 thereof in respect of his alleged increment of salary. There having been, therefore, no retentions on those increases in form of indemnity, naturally nothing could exist in the Pension and Superannuation Fund to meet his claim as to pension in respect of such increases. Consequently plaintiff's cross-appeal must fail. In the circumstances I am of opinion that the judgment of the learned Judge in the Court below was right and that his appeal should consequently he dismissed with costs. The cross-appeal, which concerns only one minor point, in my view likewise fails, as I. have already stated, and it should, therefore, he dismissed but without costs, unless any special costs have been incurred
the respondent in the cross-appeal. Appeal dismissed with costs; cross-appeal dismissed without costs. The appellant Bank's further appeal to the Privy Council was heard
Lord Blanesburgh, Lord Merrivale and Sir Sidney Rowlatt, and the judgment of their Lordships was delivered
Lord Blanesburgh. LORD BLANESBURGH: This is an appeal from a judgment of the Supreme Court of Cyprus affirming the judgment of the District Court of Nicosia at the trial. The appellants, defendants in the action, are the Ottoman Bank of. Nicosia, and the respondent, the plaintiff, is a former official of, the bank. Prior to his retirement on the 31st December, 1931, the respondent was serving in the Larnaca branch in Cyprus and the one question which survives for determination upon the present appeal is whether the pension to which, in accordance with the terms of his employment be then became entitled is, as both Courts in Cyprus have held, a pension payable in Turkish gold pounds translated into Cyprus currency at the exchange of the day, or whether, as the appellant bankcontends, it is due only in pounds of Turkish currency, or, whether so or not is in Cyprus payable only in the currency of the Island at the fixed rate of exchange of 100 Cyprus for 110 Turkish pounds, and that whether the salary pounds be gold or not. The respondent's pension, in other words, according to the view of the bank, so far from being based upon gold, is really in Cyprus a sum expressed in Cyprus currency fixed and invariable, whatever, either intrinsically or in exchange, the value of that currency may be or become. As the Cyprus pound is no longer on a gold basis, and bears in actual exchange to a Turkish gold pound a very much higher ratio than 100 to 110, the question at issue is even now one of substantial consequence to the respondent. To the bank the issue may also be of general importance as affecting the pension claims of other of its retired officials in a position similar or analogous to that of the respondent. In 1903, the respondent entered the service of the Imperial Ottoman Bank, with which, for all present purposes, the appellant bank may be regarded as identical, in March, 1905, he joined the permanent and pensionable staff, and he then signed a declaration
which he bound himself to adhere to the regulations governing the pensions and superannuation fund of the bank, which, adopted
the Direction Generale in December, 1898, had been in force as from 1st January, 1899. These regulations, as the respondent then further declared, formed an integral part of the conditions of his engagement with the bank. The regulations are voluminous. Only a few of the articles constituting them need, however, here be specifically referred to.
, the general management of the bank may at all times of the year discharge an employee, but (Article 3) lie receives an indemnity from the pension fund applicable to his case. Each employee (Article 9) cedes to the bank prescribed proportions of his fixed salary and increments. These sums are retained
the bank each month, and lodged
it to the account of the fund. The bank, for its part, is to lodge, every month, to the same account, 6 per cent. of the salaries of the personnel and undertakes to make good the deficiency, if the total of the fund, as so composed, is insufficient to meet pensions then already granted.
, the amount of a retired employee's pension is fixed "on the basis of the salary which [he] received on the 31st December of the year preceding that in which he is retired." The date applicable to the respondent's case accordingly is the 31st December, 1930.
, the amount of pension is calculated for 10 full years' service at 30 per cent, of the employee's annual fixed salary, with 2 per cent. for each of the subsequent years. Article 30 is striking. "The general management reserve unto themselves the right to modify these regulations every time they think it necessary, and in so far as the rights and interests of the personnel will not be injured
these modifications." It is complained that the general management have, on occasions, purported to exercise this power without due or any regard to the qualification imposed
the words above italicised. The powers of the hank, in this behalf, are not, however, in the present case directly in question. But incidentally the article must again be referred to. There
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