HK shipping executive seeks US$1m in unpaid wages from French firm

Top Hong Kong shipping executive seeking more than US$1 million in unpaid wages and bonuses from French shipping firm CMA CGM

PUBLISHED : Tuesday, 04 September, 2012, 12:00am
UPDATED : Tuesday, 04 September, 2012, 2:34am

A top Hong Kong shipping executive is seeking more than US$1 million in unpaid wages and bonuses from leading French container shipping company CMA CGM, the High Court heard yesterday.

Captain Igal Dafni claims he is owed about US$1.15 million in salary plus a share of three years' net profits when he was employed as managing director and chief executive of Taiwan's CNC Line which the French company took over in March 2007.

Dafni claims he was forced to resign less than a year later and is seeking salary for two years and 29 days plus profit share for three years starting in 2007.

Jeremy Bartlett, counsel for Dafni, said the executive was approached by Farid Salem, then chief executive and vice-president of CMA CGM, in mid-2006 soon after Dafni resigned as Asia president for Israeli container line Zim Integrated Shipping Services. After six months of talks, Dafni, through Charter Shipping Agencies, signed a three-year heads of agreement with CMA CGM in November 2006 as the French line targeted a takeover of CNC Line.

Under the terms of the contract, Dafni was paid US$30,000 per month and 2.5 per cent of CNC Line's net profits each year for three years starting in 2007.

Some US$10,000 of the salary was paid by CMA CGM Asia - based in Hong Kong - into Dafni's Hong Kong bank account and US$20,000 credited by CMA CGM in France to an account Dafni held with Standard Chartered in Singapore.

Bartlett, during an opening submission, said payment was split as a tax-saving measure. This prompted Recorder Horace Wong Yuk-lun to question whether the consultancy services' contract with Charter Shipping was a sham. "Do I look at it as a real contract or as a piece of paper?" Wong asked, adding it "may have some very important legal consequences" depending which view was taken.

Bartlett said Dafni left CNC after becoming embroiled in a dispute with Zim when it issued a writ in December 2007 against Dafni and several others claiming breach of contract. These claims were dismissed by Singapore's High Court in January 2010.

Bartlett said after initially supporting Dafni against Zim's accusations, CMA CGM founder Jacques Saadé summoned Dafni to a midnight meeting at a Taiwan hotel in December 2007 with other CMA CGM executives.

Bartlett said Dafni was told by Saadé the publicity about Zim's claims was embarrassing for CNC, that he could not remain as chief executive "and Saadé decided that he (Dafni) should step down immediately".

When Dafni asked Salem whether Saadé meant what he said, he was told his departure would be "dressed up as a resignation", Bartlett said, adding Dafni was told he would "get all the entitlements".