A former technical manager at Associated Supplies Company Limited (AS) was ordered by a court to refund nearly €1.7 million for breaching fiduciary duties.

Joseph Mizzi worked for a company that was negotiating a consultancy agreement with Delimara power station contractor BWSC.

Mizzi had been working for AS since 1989, providing technical assistance. After falling ill, he had requested to be boarded out. A Social Security Department medical board gave the go-ahead and Mizzi resigned from the company.

The consultancy agreement between AS and BWSC was never concluded as the contractor insisted that it would lapse if Mizzi were no longer an AS employee. AS refused to accept the condition.

Following the resignation, AS director Joseph Rizzo realised that Mizzi was still pursuing the project. Rizzo wrote to Mizzi for an explanation, never getting a reply.

BWSC later won the tender, with Mizzi as its agent.

AS sued Mizzi for alleged breach of fiduciary duties in terms of article 1124A of the Civil Code, claiming that the agent had worked without the company’s knowledge to reach his goal of becoming an agent to BWSC. The company argued Mizzi had used the “confidential, private and commercial information” he had obtained for his own gain.

The First Hall of the Civil Court, presided by Madam Justice Anna Felice, noted that the crux of the dispute lay in what Mizzi had done in the months after he was boarded out.

He first received a visit from a BWSC representative, then sought to be boarded out, a few months before he was due to retire. The court said that the meeting with the BWSC representative was not a “casual encounter”.

Mizzi had “pounced” on the opportunity when he fell ill, resigning from AS and ridding himself of any hurdle to act as a personal agent to the contractor, which wanted to engage Mizzi due to his technical expertise.

Such behaviour went against Mizzi’s fiduciary obligations towards his former employer, the court ruled.

Mizzi told the court that he had been paid a one per cent commission on the Delimara project, valued at €165 million.

The court ruled that Mizzi had breached fiduciary obligations and ordered him to pay Associated Supplies €1,697,658.25 by way of damages.