Former AXA agent who wanted $63m in damages awarded $4m by High Court
A former AXA Life Insurance agent has been awarded some $4,026,000 in damages by the High Court, far below the $63 million he had asked for.
It was the latest twist in the case of Ramesh Krishnan, 46, who brought a defamation suit against AXA in 2012. Ramesh, who was represented by Eugene Thuraisingam LLP, accused AXA of defaming him when providing references on his work performance to two prospective employers and the Monetary Authority of Singapore. This cost him a remuneration package worth $2.25 million from Prudential and a $20,000 signing-on fee from Tokio Marine, claimed Ramesh.
While Ramesh lost the defamation suit in the High Court in 2015, the Court of Appeal ruled last year that AXA had “breached the duty of care” to him. It found that the information provided by AXA in its reference check was incomplete, misleading and unfair to Ramesh, and that the insurance provider had unfairly withheld information from his prospective employers.
“This caused Prudential not to employ him,” wrote Chief Justice Sundaresh Menon in his judgment. After its ruling, the Court of Appeal asked the High Court to establish the compensation amount to be awarded to Ramesh.
In a written judgment on Monday (14 August), Judicial Commissioner George Wei, who made the original ruling in the High Court, noted that Ramesh and AXA were at “polar opposites” in their respective assessment of damages. While the former had asked for $63 million, the latter claimed that only nominal damages of $1 should be awarded. Ramesh arrived at the figure based on his projected loss of earnings, future earning potential and aggravated damages.
Meanwhile, Rajah & Tann Singapore LLP, lawyers for AXA argued that the Court of Appeal did not hold that the company’s negligence had caused Ramesh to be unemployable in the financial advisor services industry. Instead, Ramesh had merely lost a “reasonable chance” to join Prudential.
Assessment of damages
Ramesh was an agent with AXA from July 2005 till April 2011. At the time of his departure, he had 47 financial advisers under his supervision.
JC Wei found that the establishment package – the remuneration package offered by Prudential to Ramesh in June 2011 – offered a “reasoned basis” for assessing the loss which Ramesh had suffered as a result of AXA’s negligence. “What the plantiff has lost is the remuneration which he would have enjoyed if he had been hired by Prudential, had it not been for the defendant’s negligence,” noted JC Wei.
Ramesh had said that AXA conveyed a much lower persistency ratio to Prudential, which would give the impression that he was not good at his job. A persistency ratio is a measure used to track the number of insurance policies sold by an adviser that are still in force over a given period of time.
However, JC Wei did not accept that Ramesh would have earned a remuneration comparable to that which he had earned with AXA. He noted that Ramesh had only given evidence of the compensation he received from AXA for a “very short period” of two and a half years. His projection of his future earnings was also based on growing his organisation to 100 advisers within a year of joining Prudential.
Wei noted that as the judge in the initial defamation case brought by Ramesh, “I held that the defendant genuinely and honestly believed in the truth of the statement made on persistency and compliance (and) there was no proof that the defendant’s dominant motive was to injure the plaintiff.
“I find that the defendant’s conduct does not rise to the level of ‘exceptional or contumelious conduct or motive’. I also find that the amount awarded in general damages is adequate and does not call for augmentation.”
JC Wei therefore awarded damages based on the establishment package offered by Prudential: a commencement allowance of $675,000 and an initial monthly salary of $65,625, followed by a salary of $43,750 for the next 18 months. He also deducted Ramesh’s salary from his employment at Tulasi, a vegetarian cafe owned by Ramesh and his wife.
