Mwasi & Ors. v Malawi Revenue Authority (Civil Appeal 13 of 2015) [2017] MWHC 110 (18 May 2017)

Charles Mwasi & Others v. Malawi Revenue Authority J. Kenyatta Nyirenda, JUDICIARY IN THE HIGH COURT OF MALA WI PRINCIPAL REGISTRY CIVIL APPEAL NO. 13 OF 2015 (BEING MATTER NOS. IRC MATTER NO. 448 AND 554 OF 2010) BETWEEN: CHARLES MW ASI AND OTHERS ......... ................ .......... APPELLANT -AND- MALA WI REVENUE AUTHORITY ....... .......... .......... ..... RESPONDENT CORAM: THE HONOURABLE JUSTICE KENYATTA NYIRENDA for the Appellants Mr. Mumba, of Counsel, Mr. Nlchono SC, of Counsel, Mr. Orbet Chitatu, for the Respondent Court Clerk JUDGEMENT Kenyatta J Nyirenda, INTRODUCTION from the Industrial Relations Court (lower court) against an Order of Compensation dated 2151 October 2014, in which it dismissed the This is an appeal of Assessment Appellants' prayers appeal is strongly for several opposed by the Respondent. reliefs [hereinafter referred The to as "OAC"]. consolidated with Matter may not be out of order. In Consolidated IRC Matter A brief background 448 of2010 (as employees Court sitting overriding redundant at Blantyre (lower court) reason given by the Appellants by the Number 167 former Number 554 of 2010), some Respondent essentially in the Industrial for unfair dismissal. Relations The was that they had been declared of the Respondent sued the Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, Respondent Act (Act). without being consulted in contravention of s.57 of the Employment January, 2014, the lower court found that the Appellants dated 241h By its judgment had been unfairly ordered the lower court, number of issues January compensation to be assessed. dismissed by the Respondent. in order to inform the assessment that had been raised Further, by its ruling Consequently, the lower court May, 2014, clarified of compensation, a dated 3151 in its letter to as the "Supplementary Ruling"]. by the Respondent dated 15 th 2014 [Hereinafter referred The lower delivered Appellants dissatisfaction with the OAC. the OAC on 21 si October, 2014. On 5111 November 2014, the their filed a notice of appeal in the lower court expressing The Consolidated Applicants' Statement of Claim (IRC Form l) The relevant part ofIRC Form l reads: of alleged "4. Brief description etc) wifl,J,o/ding wages, trade di!,pute: (e.g. dismissal, suspension, -I. 1 Unlawful dismissal 4. 2 Unfair, wrong/it! and unlawful termination of employment -1.3 Unfair labour practice -1.-1Unlawful withholding o.f severance allowance -1.5Withheld terminal benefits -1.6 Non payment notice 4.7 Non payment of pension benefits, and house allowance severance pay, bonuses pay, repatriation allowance, of arrears of in annual salary increment -4.8Non-payment days of/eave -1.9 Wrongful deductions benefits of money from terminal package -I. IO Salary increment on promotion 5. Particulars of alleged trade dispute 5.1 Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. 5.52 By reason of the above the Applicants and are of their loss of employment have suffered entitled account damage and loss on to compensation PARTICULARS OF LOSS 5. 3 9. I {sic) Sa/a,y and other incidental benefits from the date of termination of employment and: 5.39.2(sic) Pension benefits and: 5.39.3(. Yic) Wrongful deductions ji·om terminal benefits and: 5.39 . ./(sic) Arrears in leave on promotion and: days, annual increments and increments 5.39.5(sic) Severance allowance and: 5.39.6(sic) Repatriation allowance and: 5.39. 7(sic) Notice pay and: 5.39.8(.s-ic) Leave grant and: 5.39.9(sic) Redundancy pay: 5. 39. I O(sic) Withheld house allowance and: 5.39.11 (sic) Wi1hheld bonuses and: 6. Particulars of relief sought 6. 1 Reinstatement and damages for immediate loss of all earnings, benefits and other entillements 6.2 Alternalively, compensation for unfair to the date of mandatory to be computed from the age of each of /he retirement dismissal date of dismissal Applicants and 6.3 Compensation/or loss of immediate loss o f earnings 6.4 Compensation inflation Applicants for future losses and leave days until the mandalory taking and; into accounl yearly retirement increments and age of each of the 6. 5 Compensalion for breach of contracl; 6.6 Damages for constitutional 6.7 Compensation for unfair breaches; labour practices Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. 6.8 Payment of pension benefits and compensation for loss of pension earnings and; 6.9 Payment of wrongful deductionsji-om terminal benefits and; 6.10 Payment o f all arrears in leave days, annual increments and increments on promotion and; 6. 11 Severance allowance based on increased wages and all allowances due to the Applicants which was underpaid; 6.12 and 6. 13 Payment of repatriation allowance and; 6. 1 ./ Payment of not ice pay and; 6. 15 Payment of leave grant and payment in lieu of leave 6.16 Pay ment of withheld house allowance and; 6. 17 Payment of withheld bonuses and; 6. 18 Reimbursement of money wrongfully and unlawfully deducted from terminal benefits 6. 19 Payment of sala,y arrears 6.20 Payment of disturbance allowance 6.21 Payment of border allowances; 6.22 Compensation the 8'" Respondent for the sum of MK3399,./8./.10 's terminal benefits; wrongfully deducted ji·om 6.23 Payment of the sum of MKJ./,000.00 wrongly deducted from the 8'" Applicant 's benefits as rent 6.2./ Payment of redundancy payment in terms of Clause 3.3.0 of the Condit ions of service 6.25 Aggravated as well as exemplary damages 6.26 Any other reliefs as the court may deem fit in the circumstances.\ 6.27 Costs of this action" Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, The Respondent's Statement of Reply (IRC Form 2) The Respondent prescribed filed its response IRC Form 2 and the relevant to the Appellant's provides part thereof Statement of Claim in the as follows: "3.11 Following has paid or undertaken the implementation to pay all affected employees restructuring, the respondent benefits their terminal of the organi=ational including employment repatriation expenses or entrepreneurship. and the cost of training for alternative 3.12 The Respondent denies from the claimants that it has withheld or any of them as alleged payment in the claim or at all. of the terminal or other dues 3. 13 The Respondent claims under the Employment Act was not in force at the times material claimants denies that the (Amendment) or any of them are entitled to make any Act 2010 on the ground that the said to these proceedings. 3. J. I In the premises the Applicants are not entitled to the relief claimed against the Respondent in the App licant's statement of claim or at all. " STATEMENT OF ISSUES Relations Court (Procedure) Rules requires Rule 13(1) and (2) of the Industrial conference to hold a pre-hearing parties issues. serves A statement and the court a clear sense of the issues respective structuring their Inexplicably, conference the pre-hearing (see below under "SUPPLEMENTARY of issues submissions, with a view of agreeing purpose. a very important on a statement It gives the parties of and this in turn helps the parties and the court's of the case. did not take place with disastrous RULING"). in disposition results JUDGMENT OF THE LOWER COURT The lower court held that the Appellants be found on page 14 of the judgement: were unfairly dismissed. The holding is to that the decision to terminate of consultations. due process the applicant's to think, and we agree, was unilateral and without respective "We feel inclined services that the applicants' attempt employ er. But most importantly, representations. respondent to reach a consensus. used as regards dismissals were unfair. There was hardly disclosure the employees were not afforded we find To that extent, We do not find that there was any by the of information an opportunity to make criteria that the for retrenchment. Apart fi·om that, we are at a loss as to the selection " the applicants in declaring them liable Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, The lower court dealt with the issue of reinstatement the judgement. reinstatement court reasoned thus: in paragraphs of the Appellants, ordering In ruling against 54 and 55 of the lower "5./. The applicants suggested that they should be reinstated. court may order reinstatement is to be treated whereby dismissed. employment 63(/)(a) in all respects It has been said that reinstatement is terminated under Section the employee on grounds As a maller of law, a of the Employment Act as if he had not been where should be automatic of discrimination (See Mwaungulu Jin v Lim be Leaf Tobacco), pregnancy-related dismissals (Section 49 of the Kalinda Employment (Section only be ordered Act) and where the dismissal is based on one's trade union activities 8 of the Labour Relations Act). In all other cases, reinstatement should where it is practicable lo do so and where the employer relationship. employment lo order that the parties practicable and employee were willing to continue the In this matter ii does not appear that it would be should continue in the relationship. 55. The respondent relies much on the ft1cl that their establishment was restructured it would be exotic and therefore alone, an appointed " the applicants. that ii would be impracticable lo order reinstatement lo order reinstatement. of the applicants. On that score on Therefore, date, the court will consider the appropriate compensation lo award SUPPLEMENTARY RULING mentioned, As already of the Respondent. for the request rationale The request is contained dated 3151 January 2014. The is put in the following in a letter terms: the Supplementary Ruling was issued at the written request is to be liable that the process of assessment "We believe on the basis of a prior order for liability. it is important liability in the order finding liable referencing section dismissal. how the assessment effect is that there is much uncertainty attempt for. By operation 63 of the Employment there are issues will proceed of the compensation an agreement However, " payable. is an exercise In order for the al ascertaining proceed assessment to of what the party found of law, we know that the court will proceed to give an indication compensation orderly, which the parties Act regarding compensation argued that have a bearing has not made a ruling and on which the court and it will be difficult yet. The to even for the parties by for unfair on The following were the ten issues the Respondent sought to be clarified: (a)whether the employment before the establishment of the applicants whose employment of the Malawi Revenue Authority commenced are entitled to severance pay that take into consideration Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, (b)their years service [Hereinafter where specific in the departments ref erred to as the "Government very employed by the Malawi Revenue Departments"], before Authority? of Income Tax and Customs the (c) whether the applicants are entitled the termination to notice of employment? pay and whether or not it was already paid at ( d) whether the applicants are entitled to redundancy benefits? ( e)whether the applicants are entitled to damages for breach of contract? (t) whether respect the applicant Mr. Good Nyirenda in promotion? mistake of the alleged 1s entitled to claim in (t) whether withheld the applicants by the Malawi Revenue Authority? are entitled to house allowance allegedly (g) whether the applicants insurance cover? are entitled to payment m respect of group (h) whether the applicants are entitled salary increment and bonuses allegedly withheld? (i) whether the applicant Mr. Good Nyirenda, of deduction made on his salary in respect is entitled of loss of keys? back to payment U) whether the applicants are entitled to exemplary damages? The lower court dete1mined the ten issues as follows: (a) the Appellants' contracts with the Respondent started with government contract they cannot claim severance working with government to the time of the dismissal; allowance from the time they were were terminated and the as new contracts and, therefore, (b) the Respondent not the case, the notice for unfair compensation notice paid the Appellants' could have been submerged dismissal; pay and even if that were in the award of ( c) redundacy separation benefits with their employer; are the very benefits get at the that employees Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, (d) the Appellants are not entitled to any separate breach of contract: for unfair compensation breach of contract, compensation it would be splitting dismissal hairs, on the one hand, and damages on the other in that the lower court awards in the light of the Act in ss. 63 and 64; for awards in damages as it were, to consider for (e) the Appellants allowance because paying house allowance; are not entitled to compensation to house with regard stopped that the Respondent there is clear evidence (t) the Appellants insurance of group while cover as the same was cover for death of employees are not entitled to payments in respect in the service payment in the employment of Respondent and, as such, it cannot be proper to order of the insurance of cover when all the Appellants were still of the Respondent when they were dismissed; (g) the Appellants allegedly because withheld the court looks at the salary he was dismissed; and are not entitled to salary increment when making an order for compensation that an employee was getting and bonuses at the time (h) the Appellants are not entitled to exemplary damages because the lower court is not in habit of awarding court aims to compensate of the employment of the case. circumstances exemplary damages in that the due to the termination to the regard in a just and equitable manner having for the loss suffered The determinations have not been stated of the lower court on issues herein because to Mr. Good Nyirenda his appeal. Mr. Nyirenda withdrew relating I am compelled to comment on the Supplementary Ruling in so far resting, Before as the functus officio prohibits, the same court, in the absence tribunal rule is concerned. of statutory or other statutory officio is a common law rule that the re-opening actor which rendered Functus authority, of a matter before the final decision. Once a validly-made final change it, other than to correct obvious determination has been issued, technical or clerical the court is powerless or unless errors, to Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, specifically v. Alberta Chandler wrote in relation authorised to do so by statute or regulation. In the Canadian case of J. (1989] 2 S. C. R. 848, Sopinka Association of Architects, to the principle of functus officio that: rule {is) that a final decision "The general applied subject was an error in expressing of a court cannot had been drawn up, issued where there had been a slip in drawing the manifest intention only after the formal to two exceptions: The rule be reopened.... and entered, and was it up, and where there judgment of the court." to provide finality the certainty The functus officio rule exists and businesses people The ability to revisit businesses of those affected loss. The rule is premised uncertainty wanting to are afforded and change detenninations to operate they require disrupt could easily and cause them hardship by the determinations, on the idea that overall, outweigh the advantages the lives and and of avoiding a court might have for (and its consequences) change a determination the reasons in a particular case. If a court is permitted to to judicial so that decisions effectively. revisit continually mind or wishes be finality to continue to a proceeding. or reconsider final orders simply because exercising jurisdiction over a matter, its it has changed there would never case, having delivered In the present having appointed not have subsequently Respondent's request. court became functus a date for assessment re-opened In so far as the substantive judgment after it delivered its its judgment of compensation, the substantive officio case is concerned, the lower on 25111 January 2014. the lower court should on 24111 January, 2014 and case by entertaining the ORDER OF ASSESSMENT OF COMPENSATION (OAC) A brief statement on the OAC will make the appeal intelligible. the Act, in s. 63(5), the minimum award that a court can make. The making of the actual that where compensation is awardable, of the court after having of the case which might include recourse mitigation and to the evidence of loss, the level of The lower cou1t stated provides award is left to the discretion all circumstances culpability of the parties must be just and equitable. and so on. The guiding principle is just and equitable, In determining what the court is that the compensation - ---------------------------------------- - Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. must consider occasioned by the dismissal. the circumstances suITounding the dismissal and the attendant loss stated will look at several The lower court further the court the job market, applicant court looks at the loss itself role in causing Kachinjika v. Portland and whether to award a just and equitable that in trying factors such as the marketability the qualifications has mitigated age of the of the applicant, the the job market itself, the applicant his loss. Most importantly, amount, of the applicant on and its proximity to the dismissal and the applicant's this proposition 1s the dismissal. One decision that expounds MLLR 161 (HC). Cement Company [2008] claim that they should be compensated The lower court dismissed the Appellants' for the salary that they have lost up to the dates they would have retired. court also found that "most of the applicants the loss occasioned mitigated applicants employment". by the dismissal the losses ... there is no evidence that they as a result suffered that the whatsoever of the termination of have not shown that they mitigated The lower The lower court concluded the OAC in the following terms: we are mindful "As we pointed out before, We find that the respondent the applicants. losses ready to the applicants as a result suffered that the respondent did an act that was aimed lo alleviate to the . The respondent made some payments of the retrenchment was also provide salary, repatriation and notice severance pay, pay comprising of three months' salary. to the applicants. This Court was told that the applicants were paid In this mailer, taking we are of the view that the applicants months. We find that that circumstances their respective payments made job applications, for ./2 months. lost remuneration of the ma/fer. within into account the law we have outlined and the facts of the mailer, should be compensated for 30 for their lost salary in the and ample compensation would the suitable Therefore, is ordered the respondent lost remuneration for 30 months. 18 days of this order. For the one applicant The respondent should make the who has shown that he had the and be awarded we order that he should be treated differently to pay the applicants Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, died For those applicants, that some of the applicants we make no order of compensation. We have been informed those applicants, the applicants manner as those that are still deceased appoint the deceased applicants compensatory were engaged We were also they should also be compensated matter. pursuing this counsel personal by the respondent. To that some of informed in a similar of the should deal with of the at for their estates, the respondent ·with regard to the release representatives applicants personal Unless sums. representatives On repatriation, .. .[repatriation is not an issue in this appeal} on the issue of leave: The parties have agreed that some applicants Finally, outstanding outstanding compensalion leave days. II is our direction leave pay and pay the applicant's herein. 1hat the respondenl together had the with the paymenl of the should ca/cu/ale the applicants In summary, well as leave pay. One applicanl should applicants should choice." their readiness also indicate be paid lost remuneration to be repatriated should be paid for the 30 months salary as as compensation for 42 months. The to their places of GROUNDS OF APPEAL According advanced the following ten grounds of appeal: to the Notice of Appeal dated 4th November 2014, the Appellants have "1. The Industrial for paymenl amalgamalion Departmenl unfairly dismissed Relations of severance Court erred in law in dismissing for the entire allowance prayer the Appellants' they served of /he Income Tax Deparlmenl to form the Malawi Revenue Authority period and the Cusloms & Excise up to the time they were before lhe in /he year 201 O; 2. The Indus/rial for payment conditions Relations of redundancy of service; Court erred in law in dismissing lhe Appellants' prayer benejils and no/ice pay in line with the Respondent's 3. The Industrial Respondent's and redundancy Relations conditions benejils. Courl erred in law in failing of service on /he paymenl inlerpret the pay pay, no/ice of severance lo properly Court erred in law in dismissing the Appe//anls' prayer Relations 4. The Industrial for the payment in view of the fact /hat lhe Appellants Respondent remaining to their retirement age. of compensation and in view of the fact that most of the Appellants were pwpose trained as admitted had few years by the up to the Appellants' respective relirement ages Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, 5. The industrial dismissing damages. Relations the Appellants' Court erred in law on facts found to have been proven in prayer for the payment of aggravated and exemplary 6. The industrial Relation.1 Court erred in law in making determinations on issues which were not pleaded by the Respondent. 7. The industrial lo mitigate Relations their losses. failed Court erred in law in holding that the Applicants had 8. The industrial Relations the facts when dismissing Court erred in law in failing claims. the Appellants ' various to properly apply the law to Relations 9. The industrial increments computing compensation as pleaded compensation awarded Court erred in law in failing to make an award of salary which was used for purpose of considering that the salary was one payable in the year 2010 and as such the was not just and equitable. 10. The Industrial compensation Relations Court erred in law in failing in order to make the award just and equitable. to award interest " on of appeal number I to 10 inclusively The grounds to as Ground of Appeal No. 1, Ground of Appeal No. 2, Ground of Appeal No. 3, Ground of Appeal No. 4, Ground of Appeal No. 5, Ground of Appeal No. 6, Ground of Appeal No. 7, Ground of Appeal No. 8, Ground of Appeal No. 9 and Ground of Appeal No. 10 respectively. by the Respondent, raised will be considered each ground of appeal will be referred to the Cou1t's decision Subject in turn. on a preliminary issue PRELIMINARY ISSUES Before considering issues raised notice in respect preliminary as follows: issue"). (if at all) the grounds of appeal, by the Respondent that have to be examined. of one preliminary issue (Hereinafter The notice was given on 191h December there is are two preliminary The Respondent to as the "first 2016 and it is worded referred gave "TAKE NOTICE that ar the hearing the Respondent not to be dismissed on the ground that it was filed out of time." shall raise as a prelimina,y issue the question of the appeal scheduled for 20'" December, the appeal ought whether The first preliminary in the following is couched terms: issue has to do with s. 65 of the Labour Relations Act, which Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, "(i) Subject and binding. to subsection (2), decisions of the industrial Relations Court shall be final (2)A decision of the industrial of law or jurisdiction Relations thirty Court may be appealed days oft he decision within question being rendered. " to the High Court on a that the appeal was filed out of time in that for a 2014 a notice of appeal ought to have been Nkhono SC submitted delivered on 21st October, by the 21st ofNovember, Counsel decision lodged as (a) no explanation was not lodged within been obtained to extend should the appeal be dismissed 2014. Counsel had been given by the Appellants Nkhono SC further regarding and (b) no order of the court had submitted that why the appeal 30 days of the decision the time within which the appeal should have been lodged, on this ground alone. endorsed Mumba's response on this issue is also very brief and succinct. of /\ppeal (a) is dated 4th November court is 51h November by the Counsel the Court to note that the Notice date (stamp) thereon served Messrs Mbendera very same day. In this regard, Counsel brought & Nkhono Associates service duly accepted Mumba submitted 2014, (b) the 2014, and (c) was 2014 and of the same on the that the appeal was Act. the 30 days stipulated by on Messrs Mbendera s.65 of the Labour Relations & Nkhono Associates on 5th November within He invited Counsel In his reply, been erroneously Counsel documents, Mumba that the appeal Counsel Nkhono SC conceded raised because had that the first preliminary by that the documents objection mentioned it so happened Mumba were missing on the Respondent's file. Having seen the Nkhono SC stated that he was in agreement with Counsel against the 0/\C was lodged within time. Despite Counsel appeal subplot the concession Nkhono SC sought to change tack by submitting that the appeal against the OAC was made within time, the not be entertained. that the Appellants' Clearly, the Supplementary against must fail in that it fa! ls outside Ruling should the first preliminary issue as set out in the Notice the decision ruling. issue. to raise preliminary it is clear from the Notice of Appeal that being appealed a perusal or against that of the 0/\C shows that it also dealt with matters OAC and not any other judgement Furthermore, Further, is the were the subject dates of retirement the Appellants' respective of the Supplementary Ruling up to such as the claim for the salary and the claim for salary increments. Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, the subject In short, much intertwined separate treatment. matters that it would be legally of the Supplementary Ruling and the OAC are very and practically very difficult to give them The second preliminary effect that the premise in full the Respondent's of the appeal submissions is no longer on the issue: issue was introduced by way of submissions sustainable. It might help to quote and it is to the its judgment the Respondent the Bank Limited 2014 against Consequently, ordered and assessed on 2-l' January, was that the respondent was liable for unfair dismissal on the them had not consulted the applicants the compensation "When the !RC delivered premise of the judgment basis that the respondent redundant. basis. In the case of First Merchant MSCA Civil Appeal No. 23 o/2013 delivered on 1011, October, held that the requirement them redundant certainly Convention such reliance Consequently of sums of money based on the premise that they were unfairly dismissed, they are not entitled to make these claims. not a part of our law. Further in that case, the Supreme al the lnilialive tion of s.57 of the Employ ment Act and is Court held that !LO on which when if declared proceeded on that Mkaka & Others has consistently to the extent is an incorrect interpreta that the appellants 2014 the Supreme Court No, 158 Concerning Termination v Eisenhower of the Employer to seek payment now proceed been placed in the past is not part of the law of Malawi. that an employer must consult employees prior to declaring f the lRC of 2-11' January, 201 ./, on that round. The Respondent did not lodge an appeal finding unfair dismissal. The The appeal should be dismissed against the judgment o subordinate Court Rules, however. do not provide submit that the R that might otherwise supplied the appeal by the appellants herein to raise a n issue by underlining for the filing ofa cross-appe be raised in a cross-appeal." espondent can use -Emphasis al but we Mumba submitted Counsel seeks to attack dated 24th lower court in its judgement the Respondent's liability for unfair January, dismissal 2014. As already as determined mentioned by the that the Respondent's argument is misplaced in that it it is in that judgement hereinbefore, had been unfairly Counsel liability through dismissed Mumba that the Respondent the back door. that the lower court found that the Appellants by the Respondent. is seeking In the premises, to appeal I fully agree with the judgement against on it will be recalled the OAC (delivered Further, against time. I, therefore, raise issues sought to have the Appellants' appeal 2014) dismissed that the Respondent for being filed out of seeks to be allowed to against of a cross appeal that Respondent on 24th October that would otherwise find it very ironical have been the subject Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, 2017 way out of time, what's good for the goose is good on 24th January to the OAC. Surely, In any case, the appeal of the lower court delivered the judgement more than nine months prior for the gander. the OAC. Further, appellant at the time the case was being considered baffled by the contention strange somewhat by the Respondent. court to determine proposition has been, or can be, cited. herein cases otherwise than in not against it seems to me that it would be wrong in principle it is against liability: for an by the lower court. on the basis of the law obtaining In this regard, for this novel and No authority I am In the premises, the second preliminary issue also lacks merit. GROUND OF APPEAL NO. 1 the Appellants dismissing Under this ground, law by wrongfully allowance Government Depa1iments dismissed for the entire in 2010. espouse the Appellants' prayer for payment period they served before the amalgamation to form the Respondent up to the time they were unfairly of severance of the the view that the lower court erred in Counsel Act provides that: Mumba placed reliance on ss. 32, 41 and 42 of the Act. Section 32 of the "(1) Except as provided (2), no contract shall be of employment tramferredfrom one employer withoul /he consent of/he employee. in subsection lo another (2) Where an underlaking or a part thereof is sold, /rans/erred in employment lo the lransferee or otherwise at the date of the and all /he rights di�posed of employment of an employee shall automalically be oj the contract disposition and the transferor the employee and obligations f to apply as i disposition shall they had been righls beiween the employee by or in relation have been done by or in relation and the /ransferee in respect between conlinue " to the lransferee. to the transferor transferred of !he employee and anything done before al /he date of the and obligations the disposition shall be deemed to The relevant follows: parts of s. 41 of the Act arc subsections (I) and (2) and these state as "(!) For the purpose include continue the firs/ day on which an employee up to and including the dale of /enninalion begins lo work for an employer of employrnenl. of !his Act, "con/inuous employment" shall begin from and and shall (2)fl shall be presumed, employee samejob." with an employer unless is conlinuous the contra,y whether is shown, that the employmenl of an in the remains or no/ the employee Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. Section leased, employee period 42 of the Act provides transferred or otherwise with the two successive of continuous employment that "where an undertaking or part of it is sold, of, the periods of employment shall be deemed to constitute disposed employers with the successor employer. " a single of an Based on the the following above-mentioned of law: propositions provisions of the Act, Counsel Mumba advanced (a)the effects employees' of the legal transfer contracts of an enterprise are regulated of employment by s. 42 of the Act; or establishment on its (b)the transfer continuous example, redundancy); of an undertaking employment (used for calculation does not affect an employee's period of for of entitlements, (c)the start of the continuo on which the employee http://www.redundancy British others us employment work with the old employer commenced (see s.32 (2) of the Act, help.eo.uk/LegTrans.htm, and Wilson and v. St Helens Borough Council [1998] 4 All ER 609); Fuels Ltd v. Baxendale is taken from the date and another period (d) on a transfer, the employees' rights against enforceable transfer itself: Wilson and others v. St Helens Borough Council, supra); see British Fuels Ltd v. Baxendale and the transferee and another; employer are his previous against and cannot be amended by the (e)s. 42 of the Act institutes the principl e that the contract of is maintained employment does not affect the employee's and obligations are automatically legal position, to an existing to the transferee. corresponding transferred with the transferee, employment the In other words, that is, the transfer rights since contractual relationship in the automatic transfer results subject relationship, with a new identity is transplanted of which remains the content unchanged replacement . of the employer: a into the existing his submissions, To buttress judgement of the European Danmark v. A/S Danmols Invcntar Court of Justice the European wherein dicta is at 2641: 42 of the Act. The first Counsel Court of Justice Mumba referred the Court to dicta in the in Foreningen af Arbejdsledere i (in liq) Case 105/84 [1985] ECR 2639 commented on a provision which akin to s. Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. as against is entitled in my opinion, employment lo insist, By virtue relationship. on the same or fails to observe "The effect of the Directive, time of transfer existing be employed by the transferee or if the transferee ref1.1ses breach of contract or the relationship, against dismisses an employee for one of the reasons if dismissal. Otherwise the dismissal the undertaking is that an employee the transferee, on all the of the transferor rights at the of Article terms as he was employed with the transferor, claim to continue 3, he can thus under his lo those terms, the transferee in article he can bring a claim for . . . The employer who the -1(/) of can thus justify specified or business, the employee can insist dismissal on his rights under Article is based on the transfer or purported 3. " The second dicta is to be found at 2650-2651, paras 15 and 16: show that the directive is intended by making it possible lo safeguard of a change of employer of workers those provisions in the e1•e11t to work for the trans:feree stated As the Court "15 Taken together the rights to continue transferor. Music ApS (in liq) Case 19/83 possible, employment particular any collective motivated agreement by lhefc,ct the transferee (Article <�(transfer [1985} ECR 457 relationship to confin1.1e in its judgment by obliging that the solely to observe 3(2)) and by protecting -1(1)). (Article for them the as those agreed with 1985 (Wendelboe to ensure, v lJ as far as transferee, in of the terms and conditions workers dismissals against at -162), it is intended continues unchanged with the under the same conditions of 7 February which the directive decides of his own accord not lo continue is intended to g1.1arantee is however redundant the employment with the new employer terminates the after the tramfer. contract of the transfer, e_ffect ji-0111 the date employment Thal is the case where the or ernployment or where that contract 16 The protection where the person concerned relationship employee in q1.1estion his own free will with relationship agreement of/he undertaking. is terminated voluntarily with effect from the date of the transfer concluded In that situation the worker and the transferor 3(1) of the directive does not apply." between Article relationship of or of an by virtue or the transferee It is also the view of the Appellants Malawi Revenue thus: Authority that the lower court misinterpreted s. 27 of the Act (MRA Act). Counsel Mumba argued the point "3.15 ... the section does not state that the Appellant's employment with Government Authority 27 of the Malawi Revenue A proper reading of section employment show that the Appellant's with Government was was terminated. Act would actually transferred to the Respondent. 3.16 More importantly, the Respondent did not dispute undertaking Authority from the Ma/cnvi look over functions Government to itsel previously pe,formed by Government Departments Iha/ there was a transfer f as the Malawi Revenue of Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. and Excise and the Income Tax. llowever, of Customs before the lower court Iha, the Appellanls in lerms of sec1ion Respondent Respondent, the Applicant's Applicants British Borough the Respondent argued to the were merely on secondment to the of the MRA Act. According and !hat the was a temporary the case of tramfer Your Lordship, Wilson and others v St Helens Fuels ltd v Baxendale (supra/ by their employer. and another; secondmenl were subject lo recall Council 27(./) for example, employment to employee's redundancy). exclusil'ely of entitlements, period of continuous It applies were on continuous them lo different (used for lo the Applicants employment. The stations. Such them redundant. the Applicants. We Act and in Authority employed the Respondent also had powers of.firing the Applicants them and lramferred What is clear here is that promoted applies calculation herein. The Respondent Respondent being the case the Malawi Government 27(./) agree Iha/ in lerms o.fseclion terms of subsequent of the Respondent, Applicants. There Respondent. The pulling a break. create imagination with the Respondent. Fuels Ltd v Baxendale the case British Council Helens Borough their rights and another; were not affected them or declaring could not recall of !he Malawi Revenue and Wilson a11d others v St " the by the were employed was no break at all when the Applicants 32 of the In terms o.f inter alia section Employment Act by the merger. conduct of the Applicants would not by any slightest It would not affect the Applican1s continuous service on probation his submissions on this ground (Ground In concluding Mumba contended by adducing that proof or severance evidence documentary of employment but the Respondent failed to do so: of Appeal No. 1 ), Counsel should have been done it is a sell led rule of e,•idence that if a party relies "Moreover, in a document, give evidence (Civil he must produce of the contents Case No. 2726 ofJ 999. [2001 I MWHC 57)" and prove ii otherwise of the document (Mikevasi or terms upon a document, such party will not be allowed to v Ching'amba and Others of the Respondent is that the Appellants' respective employment with Government The position contracts Respondent cannot claim severance Government Depaitments started were terminated and their respective with the contracts as new contracts. allowance to the time or their dismissal. It is thus contended from the time they were working in the that the Appellants Counsel Good Chakaka follows: Nkhono SC placed Nyirenda. reliance The material of Mr. on s.27 of MRA Act and the evidence as part of s. 27 of MRA Act provides Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. "2. Except as otherwise contracts. debts. Department commencement enforced by or against of Customs obligations and Excise o( this Act shall remain vested the Government. provided in subsection(J) in relation and liabilities o[the Government and the Department o(income to property, attributable all to the Tax before the and may be in the Government 4. Unless the Board other.11ise determines, all persons who before the laws specified of this Act are employed in the Schedule commencement the written deemed to be on secondment service ofthe Authority Authority otherwise ceases in accordance to the Authority by the Government shall. for the purposes of on commencement o(this Act, be until they are employed in the with this Act or their secondment with the in accordance supplied with the terms ofthe secondment. " -Emphasis by underlining of MRA Act, Counsel Nkhono SC submitted for by the Appellants of undertaking Based on s.27(2) contended a transfer into the Respondent institutions Respondent of the Government are specifically provided is erroneous in that the aspects Departments for in MRA Act: or a merger complete with transfer that the notion was by way of and liabilities of assets of the operations that the creation of the Respondent that were transferred and to the "5.3 Regarding to the employment whm happened of those of the appellants who had worked for h110 Government departments aforesaid, one only has to of the applicants Nyirenda, in Government of Mr Good Chakaka in the cow·/ below whose previously look at s.27(./) below; the applicants the establishment of MR. A. <�( the MR. A Act and the evidence in particular, employment the evidence who was one of in the court pre-existed was contained both in a written witness statement and also viva voce evidence in court al the hearing. to Mr Nyirenda 's witness the office of the Secretary statement lo the Treasury to in the Department of Customs and Excise. and rnrious issues but in paragraph 3 (screening The is a 's evidence with exhibits marked "GCN2" exhibited 5.4 Mr Nyirenda complete document feller the Controller The letter appointment the Board of MR. A decided Departments "appointment that paragraph. dated 21s' October, of Customs addressed of staff on probation) 1999.from and Excise refers of Income Tax and Customs & Excise would be screened on probation" for is explained in to MR. A. The method of screening to S.27 (4) of the MR. A Act. Evidently, thal members of staff from the Government 5. 5 The process would work as follows: 1) Members of siqf f interested application form lllU 2 indicating in a job in MR. A would apply for it on the post that they then held. thereon Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, 2) Members <�( staf f of the two Government those not interested Departments to join the employment who did not apply of MRA) would be in accordance with the Malawi Public Service Regulations (presumably handled (MPSR). f who applied 3) Those members of staf the screening according (MPSR). Those who passed the screening employment f lest or fail it. I they failed of service but only on pro bat ion for a period to the conditions of one year . for a job in MRA would either pass it, they would be dealt with test would be offered applicable to Civil Servants ./) At the end of the one-year probation, the probationers would either or fail it. For those who failed Sen-ice and he handled the probation return to the Cil'if Those il'ho passed the probation permanent employee MRA.'' of MRA or as a fixed term contract would be offered employment as of the probation, in accordance pass they would with the MPSR. either employee the creation party that the to the Authority were, according than the process set out in s. 27(4) otherwise that Appellants who pre-existed to s.27 (4) of MR. A Act, "deemed until they are employed in the service of the on the commencement in the service of was either employed ceased in accordance with the terms of the Counsel Nkhono SC submitted that it was not suggested by either Board of the Respondent determined of the MRA Act. It was thus argued of the Respondent secondment ". This deemed secondment Authority. Act and it would continue until the person the Respondent secondment. It is not correct then, so the argument of MRA Act, former employees became employees of the Government Departments overt act of employment e place. had to tak of the Government Departments In order for any former employee to become an employee according of the Respondent, the to s.27( 4) of MR. A Act, of the Respondent. in the Respondent, or the secondment operated automatically of either to be on of MRA goes, that on the commencement A to employer B, the employee's B but the employee Counsel Nkhono SC also submitted employer employer buttressed his submission Finance (2005) wherein as follows: the Industrial Court explained continues by citing that when an employee is seconded from as the employee employment is not transferred to of employer case of Simpson National A. He the Malaysia Bhd & Anor v. Omar Hashim [2002] 1 LLR 272 (Award No. 1013 of the meaning of secondment at P 277 "The ordinary connotation that the employee as a temporary to recall of secondment is subject meaning by his employer. is on the face of ii the So he is not a transfer, Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, employee permanent Ashley Power quoting transfer: of the other. In Comex Services Asia Pacific Region, Min v Game OP Malhotra at p.2./6 it reinforced the idea of a temporary 'Therefore, employee continues so long as the con/rac/ is no/ lerminaled, of the original a new con/rac/ employ er'." to be in the employmenl is no/ made, and the Counsel aid the employment Nkhono SC also forcefully provision in that: wrong to call in of the Act in ss. 41 and 42 that deal with of continuation argued that it would be legally whose Government "the appellants February, February, came into force only in September, 2000. Mr Nyirenda 2000 (marked certainly "GNC3" in his witness pre-existed MR. A were employed on l" dated 8'" was; that was by offer of employment The employ ment Act 2000 statement). employment 2000. " the Court to note that the Respondent, on the other hand, are separate on one and Departments, Nkhono SC fu11her invited Counsel hand, and the Government distinct entities: Deparlments "In any event, on the other hand, are not the employees are not Civil Servants; possible were Civil Servants. of Customs & Excise and Income Tax on one hand and MRA same entity; those were departments of specific statute the MPSRs do not apply lo them. Clearly, MRA is a creature even though ii was whose of Government and its employees in MRA once they successfully their probation lo have reverted for those appellants concerned one year probation employed date of the employment (in the style of S. ./2 of the Employment disposed as permanent staff members with MRA. Certainly. ofto MR. A" to the Civil Service completed in MRA, their employment the two Government and were in MRA started on the were not Departments Act) sold, leased, transferred or otherwise at the end of their the submissions by both Counsel with the Respondent 27 of MRA Act is clear. commenced and specifically employed in 2000. Therefore and I am inclined to agree with of the The employment only on the dates when by the Respondent after the who pre­ those of the Appellants of the Respondent of the Respondent only became employees by the Respondent at the end of their employed Their employment by the Respondent. There was no transfer with the Respondent started at the point of undertaking from Appellants Nkhono SC. Section I have considered Counsel respective they were respectively formation of the Respondent the creation existed when they were expressly respective of employment which to infer transfer clear provisions Respondent Government secondment. of employment contract. of s.27 ( 4) of MRA Act. Certainly, That would run counter employment to the with the in the from, employment did not relate back Departments. to, or continue Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. and perhaps Further, s.27(2) more importantly, in clear terms that all contracts, debts, attributable MRA Act shall remain vested in the Government against enough to include the Government. to the Government Departments employment obligations contracts of the MRA Act expressly provides of the Government and liabilities before the commencement of the and may be enforced by or To my mind, the scope of s.27(2) of the Act is wide of the Appellants. On the premises, of their respective Respondent this ground of appeal Departments. Accordingly, none of the Appellants in respect is entitled to make any claims against the employments in the Government has to fall by the wayside GROUND OF APPEAL NO. 2 Counsel whether the Appellants Mumba dealt with this ground of appeal under two sub-issues, or not the Appellants were entitled to notice pay, benefits. to be paid redundancy and (b) whether were entitled or not namely, Whether entitled or not the Appellants were pay to notice On the first sub-issue, of Service aid the provisions provided Counsel of s. 30 of the Act: for the payment Mumba submitted of three months' that the Respondent's Conditions in pay. He also called notice "-I. I. 30(2) of the Employment the employer shall pay the that would have been received Section termination, remuneration benefits due to the employee Ac, provides up lo the expiration oft he required period and confer on the employee all other of notice. that in lieu of providing of employee a sum equal to the notice The Employment Act, at section 30(3) states: in which notice was required, 'Where the employee terminates the circumstance waived the right to notice, the employee shall employer otherwise period notice in without and the ernployer has not to pay the be required that would a sum equal to the remuneration of the required in lieu of notice ha\'e been to the employee up to the expiration o_f notice. contract ./.2. Here the period of notice is 3 months. The Applicants are therefore to 3 entitled months notice. " Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, The issue of notice The latter the Appellant's Skeleton Arguments: pay is very much interlinked with that of ex gratia payment. issue is mainly dealt with by the Appellants in paragraphs 6.5 to 6.8 of "6.5 In terms of the case of Kac/1i11iika v. Portland once ex gratia Cement Company [2008} MLLR has been made it made when an employee payment is usually on this court, 161, which is binding cannot be taken back. Payment retires or is declared this case the Applicants payment payment back the ex gratia Company [supra}. Portland Cement redundant were declared which is contra,y of ex grafia or retrenched which was dully paid to the Applicant and not when he is dismissed. the ex grafia To convert in redundant. to notice to the binding pay would be to take case of Kacltiniika v. 6.6 To hold that the ex grafia three months' Company [supra}. word ex gratia payment. payment notice would be contra,y fact, which was made to the Appellants v. Portland to Kac!,iniika fellers a/I the Appellants received In actual which had the Cement represented 6.7 The case of Kachiniika v. Portland Cement Company is on four walls with the present case. It cannot be distinguished. 6.8 The Respondent the Applicants with interest " of course. did not pay notice pay. ft should be ordered to pay the same to the suggestion by the Respondent Mumba invited the notice of the Respondent's pay. Counsel communication (3 months salary)". that the ex gratia the Court to pay It to the Appellants. There was no mention by citing v. Portland Mumba buttressed Skyways Ltd (1964) WLR and Kachinjika his submissions that it was "/.:,x-gratia pay. Counsel Mumba trashed was actually to wording stated Counsel payment attention expressly of payment the cases of Edwards v. Cement Company [20081 Case"]. of notice referred MLLR 161 [Hereinafter to as the "Kachinjika The Kachinjika he then was, on the purport and effect of ex gratia payment: Case was cited for the following observations by Chikopa, J., as "We would also agree with the defendant the defendant herein is entirely We are however discretion given, unconditionally, as a token of thanks of the granlor in the discretion of the grant or whether unable to agree with the defendant that once granted to take it back. As we understand ex gratia or not to grant it. it is also in the payments they are it is that an ex gratia payment of the kind made by to the grantee/or services well rendered. Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, herein. what happened was made because The payment to reward the plaintiff/or for good reasons exactly befitting their discretion, that they can at any time therec,fier must be taken to be a gifi out and out. After all it is not as if the defendant position company. misrepresentation The only way ii can be had hack is if it were premised which is no/ the case herein. gel ii back. The ex gralia to the plaintiff" we are sure, in favour the good service to "refund" f it is not the case though thus styled would be in a many years of good service. But having so exercised of the plaintif that he put into the defendant the defendant The case of Malawi payment thought on fraud or ii fi"om the grantee Railways 1998) has a discussion Ltd v PTK Nyasaulu MSCA Civil Appeal No. 13 of 1992 (decided in November 011 ex gratia payments Iha/ is in tandem with our opinion above". Mumba also contended Counsel pay in the award of compensation notice that employers for unfair pay in this case was contractual give notice should before and, secondly, tenninating that it would be legally dismissal notice wrong to submerge of as, firstly, requirement it is a statutory the payment the services of any employee. The Respondent concedes contends Respondent's Submission that the notice on Appeal: that the Appellants were entitled pay was made. This is to be found in paragraph to notice pay but 7. l of the that the appellants were enlitled Act 2000 when their employment of the appeal we, inadvertently "7.1 . . . We confirm Employment hearing entitlement seek to correct Employment was made at termination o.fthe that notion and confirm Act. 711e Respondent's argument, appellants· pay on termination expressed of employment employment to notice in 2010. lo no/ice was terminated pay under S.29 of the in 2010. At the doubt about employee such entitlement under S.29 of the pay then and now, is that notice through redundancy. We of Service deals with "Redundancy." and were retrenched who is declared in lieu of notice. salary so this clause redundant " At the lop end, The applies to is entitled 7.2 Clause 3.3.0 of the MR. A Conditions were declared redundant that an employee months' appellants them. One of the benefits to under Clause 3. 3. 0 is "three under S.29 of the Employment Act is lo pay ll'C/ges no/ice MR. A Condi/ions therefore Employment termination MRA Condi lions of Service Employment where the contract of Service Ac/ hy prol'iding of employment Ac/ 2000 requires al a monthly the minimum of one month's rate. Clause 3.3.0 of the with S.29 and S.30(2) of the fully complies for employees· in such circumstances. more than complied with Sections in Jae/ Clause 3. 3. 0 of the 29 and 30(2) of the notice pay in the even/ of 2000 by exceeding for 3 months· providing the lop-end sala,y to e1•ery . " employee instead statutory minimum of one month's and notice Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, view on this sub-issue. Its case is that the payment espouses a different The Respondent salary three months' as "Ex Gratia (three of termination the reference to ex gratia payment was in compliance It may not be out of place to quote in extensio sub-issue: to the Appellants months' was no more than a mistaken with Clause salary)" which was referred was actually to in the letter pay and notice and that description 3.3.0 of the MRA Conditions the Respondent's argument of Service. on this "7. 4 The appellants' claim that despite three months' receiving salary to another entitled, "ex gratia. was called base a claim. The re.!ipondent " With due respect, the three months' salary, they are for no other reason than that the first this is a very flippant basis on which to could have simply issued a cheque for precisely the notice pay was duly made. same sum as they issued the respondent had claimed notice based, not on parties' obligations accepting was just a mistake. Mr !!annison rights the cheque.for taken that course of action and not call it anything. the appellants It appears that would not have that three months' if pay at all because they would have assumed It is a sad day when decisions but semantics in law There is eve,ything Banda 's evidence of the courts would be and it should be based on rights to militate for payment to ex-gratia in the circumstances that reference 7.5 Mr Chakaka Nyirenda testifying that the obligations was to comply with such payments for the appellants of the respondent in the court below, conceded at the point of termination to the appellants and the re.1pondent obligations in the contract 's obligations. of employment must be found in the Employment Act and the MRA of with as accorded rights The applicants' the between Naturally, be mediated will, of Malawi by the dictates of justice and the common law. It would be a sad day in the delivery not on the basis of their legal rights the content o_{those rights of the Republic and obligations, and obligations craft parties' rights but on words they have used after the fact even in light of a party and can demonstrate that '"ex grafia" was an unfortunate in evidence employment the applicants' rights and the respondent's applicants and the respondent of Service. Conditions in appropriate cases, Constitution if courts and obligations, who clearly misnomer. states 7.6 Further, Mr Chakaka correctly accepted that there is no provision in A'yirenda of Service of Service that entitles the applicants could in fact, provide for an ex gratia to an ex gratia payment the MRA Conditions payment. Conditions for an employee. payment becomes to the employee. of Service do not provide By so providing a contractual There is no conlradiction in the Conditions that the employer ':Jc1vo11r" of Service, the "ex gratia" has agreed to provide in terms there. The MRA Conditions for any ex gratia payment for employees. Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. 7.7 MRA is a creature of stalule with a slral�(ied system within which ii must acl. fl mus/ comply with the MRA Act in ils operations; MRA have power andjimctions the Public the Board and other organs of spell oul in lhe Act. As we have indicated Act also applies lo the operations Management Finance of MRA. The earlier, to the restrictions We have already by 76 of /he Public of MRA must as a ma/fer of law, be used on lawful adverted Finance resources purposes. corporations for the court to be too ready to find that the respondent pay oul an ultra vires and extra-legal in view of clear explanation employees lo ex gratia was a mistake that reference Condi/ions (therefore .fi'om the respondent o.f provision Management unla11ful) for ex gratia payment. o.f Service Act. ft would be unusual its resources payment in the court below ex gratia and authorised placed on stalulory and in view of the absence applied in the MRA to to Counsel Mumba and submitted to the authorities that the same were distinguishable: Nkhono SC then turned his attention cited by Counsel "7.8 The cases of Edwards v Skyways Ltd (1964) WLR and Kachi11jika v Portland and its payment in the obtaining fi'om circumstances in none of the cases cited did the question are clearly distinguishable proceedings. a paymenl Cement Company (2008) MLR 161 with regard lo ex gratia legal effect, present arise whether where the payer thereof esloppel payment in favour of lhe payee res/raining was really.for. which is mislakenly is able lo explain what ii related For one 1hing, to still founds an the named as ex-gralia in circumstances !he payer from explaining what 7.9 Again, v Portland Cement payment the purposes once an ex gralia case. Fur/her, in the Kaclti11jika by a laiv thal reslricts whether in part, wilh the question in none of those cases did the court ever have to deal with a payer who is may be lo which ils resources regulated applied as in the present case lhe court deal/, has been made, it can be taken back. In that case when the payment there was no doubt that it was mean/ as an ex gralia suggestion /hat ii ll'OS meant as a payment the respondent says that it never mean/ lo make an ex-gratia it had no power to do anyway), the description "ex-gralia" from the star/. but only sought for sums to be applied right J,-om the start. There practice had been terminated applicants misnomer employees case, payment (for which right was a mistake did not try to take back an "ex-gralia payment" that they were mean/ for payment f such practice I would be able to show that description of ex gratia but that receipt " redundanl. being declared that there was whose employment had been eslablished, the was not just a of expectation al MRA to make an ex-gratia for redundancy. by /he appellants to employees pay was a legilimate is no suggeslion else. In lhe present The respondent to the purpose for anything as ex gralia and there was no payment was made, a Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. the respective are agreed that the Appellants of Service Conditions on this sub-issue. were entitled, to be paid three months' The starting point is 3.3.0 of the in lieu of submission per clause salary considered I have that the parties Respondent's The parties notice. The dispute salary. that as the payment contend conclusive of the nature that the payment more than a mistaken was salary are also agreed that the Appellants is with regard to the nature were paid three months' of the payment. than notice rather pay, this was The Appellants was termed ex gratia of payment. On the other hand, the Respondent in lieu of notice and the reference to ex gratia argues was no description. to Wikipedia According "by favour") done ex gratia, gratia legal obligation. payment ex gratia Encyclopedia, and is most often used in a legal context. (sometimes ex-gratia) is Latin (lit. When something has been it has been done voluntarily, is a payment out of kindness the giver recognising In law, an ex or made without or grace. any liability To my mind, the nature necessary letter Respondent's [Hereinafter referred reads: Letter of the payment cannot be determined in abstract. It is that is, the that regard be had to the relevant correspondence, dated 2t11 July 2010 and the schedule to as the "Termination attached The body of the Termination Letter"]. thereto "It is with regret that that commenced therefore declared in July 2009, your position redundant. we inform you that following review the Organisational affected You are has been adversely process You will there{ore A((ached hereto be paid vow· terminal benefits o[the total terminal in accordance payable benefits is the schedule to you. with Employment Laws. wishes to thank you for the contribution Management through development your job in Malawi Revenue supplied. underlining you have made towards national Authority. " -Emphasis by The schedule Terminal to the Termination Letter Computation" "Malawi Revenue and it sets out the "Name", "Salary", is entitled Benefits "Years of Authority Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. Service", 30% ", "Nett before loans" and "Total Loans". "Severance Pay", "Ex -gratia (3 months salary", PAYE "Total", Letter in the Termination in accordance with Employment of terminal benefits payment The catchwords terminal benefits consistent with or grace (see the Wikipcdia view, the terminal benefits Employment Employment gratia payment for employees. are "You will therefore be paid your is not Laws". This wording been done voluntarily, out of kindness In my definition from the to have to be those flowing Neither the Conditions for any ex of Service. of Service provides Act and/or the Respondent's Act nor the Respondent's Conditions being referred Encyclopedia of ex-gratia above). In the premises, that is, three months' it is my holding salary in lieu of notice. that each of the Appellants was paid notice pay, Whether or not the Appellants were entitled to be paid redundancy benefits element A central lower cou1t erred in equating not be out of in the argument place to set forth in full severance allowance their submissions of the Appellants under this sub-issue is that the It may to redundancy benefits. on these points: "-1.9. In making its determination on the claim for redundancy that ··tooking al the submission would seem to be the ve,y benefits stated benefits their employer". terms of Clause 3.3. 0 c�f the Respondent Appellanls. with The lmrer court never made an award of redundancy in as pleaded by the applicants, that employees benefits by the 's conditions of service benefits, the lower court the said redundancy get at separation -I. I 0. My lord, the Respondent's conditions o.f service, Clause 3. 3. 0, is very clear that the Appellants following terms. are entitled to redundancy benefits. Clause 3.3. 0. is in the "Before should discuss redundancy any post in the Authorily is declared redundant the Authority proposed redundancy with the Board. In the event of an employee shall be enlitled to: (i)Three months' sala1y in lieu of notice. (ii)One month's Junior salary Senior for each completed Sta.ff Sta.ff.or year of service for either Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. (iii)Refund of own Pension Contributions in accordance Contributions Fund Rules. Pension ll'ith plus employer's (iv)Payment <�f outstanding leave days. (i) Payment of outstanding hours" . overtime ./.11. of service the conditions the lower court made no reference is not the same as redundancy My lord, despite court, allowance Respondent's conditions separate clauses. The Respondent cannot allowance this Honourable with the order that the Respondent Appellants before being cited extensively to it. My lord, the fact that severance can also be discerned benefits from the in allowance differently which use severance severance the statutory and substitute it benefits to the " in Clause 3.3.0 of the Conditions substitute benefits. set aside the lower court's with the contractual Court should should pay redundancy it is therefore redundancy as outlined of service of Service. prayed that the lower ruling The position referred compliance with of the Respondent on this sub-issue to the Termination is that the "Severance pay" paid in Letter was actually to in the schedule Clause 3.3.0 of the Respondent's employee, year of service". the Respondent's in the event of redundancy, on the matter The submissions Submissions Conditions to "One month's on Appeal: of Service which entitles an completed salary for each are to be found in paragraph 6 of "6.1 Clause 3.3. 0 of the MRA Conditions of Serrice in force at the date of retrenchments [page 103 Volume A of the Record in 2010) is headed of Appeal} (that were "Redundancy" and does not contain which the appellants of the text. Very clearly. that clause redundancy. year of service One such entitlement Staf Junior for either clause have coined. A section is "one month's f or Senior Staff." expressly the term "redundancy benefits," is not part of the substance heading 3.3. 0 deals with redundancy. One of the things to in the event of 3.3.0 deals with is what an employee is entitled salary for each completed 6.2 in the evidence in the court below, (Mr llannison Banda) admilted is not the same as "redundancy counsel in cross examination 3.3.0 of lhe MRA Conditions ·· but only in responding -counsel of Service put lo him by the applicants' Mr Banda to accept benefits, that clause that severance lo a allowance question pressed of se,•erance makes no mention fact. Mr Banda did so. By so doing, push through applicants such, in clause entitled call "redundancy tu in the event of redundancy. however, the notion that clause 3.3.0 provides, ll'hich bene.fils;" 3.3.0. Clause 3.3.0 thus deals with benefits counsel the applicants' instead, sought for whal lhe is a phrase thal does nol exist as to that an employee is allowance and asked Mr Banda to confirm that Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. 6.3 The contention seems to be that "severance allowance" is not mentioned in of Service allowance. 3.3.0 of the MR. A Conditions clause does not deal with severance the "one month ·s salary whether Junior Staff or Senior is not the same as severance Employment Staff' Act 2010 is a in clause This is incorrect. for each completed year of service Consequently, for either of Service 3.3.0 (ii) o.(the MRA Condition allowance prm•ided for under S.35 of the and that therefore clause 3.3.0 of law or construction to be decided by the court. We submit that in fact question that provision precisely S.35 of the Employment comply with the minimum <�(the provisions citing and complies :,pecijic in clause 3.3.0 (ii) of the MRA Conditions to pay severance with the requirement Act 2010. It is enough for Conditions requirements of the Employment Ac! with which the Condi/ions of Service comply. of Service relates under affowance to of Service Act 2000 without of the Employment ll'hich reinforce contracts minimum standard all employment and regulate Ltd v Aubrey Nk/,ata, 6 . ./ One of the purposes slandards establish, DHL /11tematio11a/ Appeal No. 50 of 2004 (unreported). employers their conditions of Service an contracts with the Emp loyment Act 2000. If Act 2000 was to set minimum employment must comply with. It is "an Acl to of employ ment. " Also see Civil Act required and, by extension, Act 2000. The MRA Conditions Principal S.69(2) of the Employment o.f employment comply with the Employment to align their employees' IligJ, Court, an emp loyment Registry, of service contract of such as the applicants herein Act, such employee employee under S. 35 of the Employment allowance. The appeffants among other things, in 2010, each paid ion o.( employment as one month's salary for each year completed on redundancy, is entitled is terminated at terminal service 11·ere, clearly to severance provided Service. the Employment severance completed allowance service. for under Clause 3.3.0 of the then applicable This more than complied MR. A Conditions of under S.35 of with the minimum requirement Act to pay such employ ees depending on length of service, o.f belll'een two to four weeks' wages for each year of 6.5 Clause 3.3.0 (ii) of the MRA Conditions intended in that by and does comply with S.35 and S.69 of the Employment Act was clearly of Service for allowance for the minimum severance compliance way of providing Act ii exceeds wages for each completed Once ii is accepted redundancy of the MR. A Conditions second set of severance of the Employment are not specifically p11rs11ant that altho11gh by entitling the minimum requirement year of service regardless that an emp loyee whose employment to the payment would, under the Act be entitled of Service allowance it is wrong to suggest payable for a redundant Act on the ground only that the word1· This wo11ld 3.3.0. used in cfa11se 10 S.69 oft he Employment create of S.35 of the to a month's standard every employee of the length has been terminated of service. for 3.3.0 set our in clause "severance allowance" Act the Conditions an absurd sit11ation of Service that there ought to be a employ ee under S.35 Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, lo comply with the Employment Act and do provide m11sl be crc!fted than the minimum requirements because the Conditions allowance employee that sum twice over. on Clause 3.3(ii) of Service of the Act (in many cases exceeding have not specifically p11t the label severance as in the Act then the employer must pay the for not less just those), Stc!ff or Senior that the sala,y in clause not correct Junior is not the same thing or does not satisfy one months' Sta.[( 6.6 It is therefore for either service of Service under S.35 of the Act. That is Act; at any said earlier, as coined by the applicants. "redundancy by the statutory, of service and the contractual f (S. 35 o the statuto1y req11ire111ent t he Act). clause 3.3.0 does not of it satisfies the severance conditions rate, payment benefit" anywhere allowance S.35 of the Employment referred Act. In fact, as we these sums as a describe The contractual to (cla11se 3.3.0) for each completed 3.3. 0 (ii) of allowance to in S.35 of the severance year of the Conditions payable is dictated effectuate 6. 7 The only place in the AIRA Conditions of Service 3.8.0 (Gratuity). According lo clause under the pension fund and are not covered is where the word "severance" 3.8. 1 employe es who are are by any contract used is in clause not eligible entitled way of dismissal Altho11gh the heading is not used in the body o,(the to "severance pay" when their employment is terminated other than by (presumably for some wrong doing or fault on their part). o,( that paragraph is ·'Gratuity" the word "gratuity" f itsel paragraph. 6.8 Before the Pension deciding if any was eligible any which categories Act was passed, employers not be eligible 11·ould of employees in had considerable fund for the pension who "are not covered at all. The reference to employees latitude by contract" de.fined refers presumahly in the conditions to employ ee.1· who are either ofservice) or others who are, sornehow, "temporary staff'' (as by not covered There is sel'erance payment provisions. other than by way of dismissal. at any given time. It wo11ld employees MRA Conditions of Service "severance "severance are not entitled. pay" (assuming allowance" pay for Very clearly, be ahs11rd those employ ees on termination this is a very limited to suggest number of to the of employees to entitled in clause 3.8.1 is the same as that according this is the only category "severance pay" in S.35 of the Employment Act) and all other employees Very clearly, of the Employment Service appellants Employment clearly employees are entitled to severance allowance Act; and this is ll'hether use the words "severance or not an employ er's Conditions on the basis of S. 35 of the " Consequently, by S.35 of the required allowance. allowance were already paid their severance Act 2010 when MRA terminated their employm ent in 2010." Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, I have considered provision Appellants' contracts, the respective submission on this issue. The Act, in s. 35 makes for payment of severance pay. At the time of termination of the the text of s. 35 of the Act read as follows: "(l) On termination unilaterally the time ofterminalion, First Schedule. by the emplol'er, of contract, an employee by mutual agreement shall be entitled with the employer or to be paid by the employer, at with the in accordance a severance allowance to be calculated (2) The Minister organizations Schedule. may, in consul/a/ion with organizalions of emplo in !he Ga=elle, amend the First yers and of employees: by notice published (3) The employment with his capacily himsel to provide the allegations !his opportunity. of an employee before the emplo made, unless f against or conduct shall no/ be terminaled yee is provided for reasons connected an opportunity to defend be expected cannot reasonably !he employer (./) For the pwposes the insolvency or death of 1he employer, inc/ude- bu/ does not o.f subsection (}), terminal ion includes termination by reason of (a) /ermination of a conlrac/ occurs where termination of employment al !he expiration for a specified period of of the .1pecified or period; time (b) a conlract occurs for a specified of employment f o the !ask. at the completion task where the termination (5) The payment employee's compensatory i( any, to payment enlitlement. all'ard or special in lieu of notice 63. under section of a severance allowance under subsection (1) shall not affect the under section 30 or lo a (6) Subsection (]) shall not apply where the employee-- (a) is serving period a probalionary as pro,•ided for in sect ion 26; (b)is fairly dismissed for a reason related to his conduct; (c) unreasonably refused to accept an offer of re-emplo yment by the employer at the same place of work under no less favourable employed prior 10 the termination; immediately terms lhan he was (d) is employed by a partnership and his employment dissolulion of the parlnership and he enters info employment ceases on the with one or Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, to accept an offer of employment immediately after such dissolution by any such partner or unreasonably terms than he was employed immediately under no prior to the more of the partners refuses less fal'Ourable dissolution; (e)is employed by a personal employer of the personal enters who dies, and the employee or widow, widower representative, death or he immediately after such by such person on an offer of employment into the employment any heir of the deceased unreasonably refuses no less favourable dealh. employer to accept terms than he was employed prior to the immediately (7)Where the contract employee, employee labour the sererance or, in the absence officer may decide. <f employment is terminated shall be paid to the surviving allowance by reason of the death of the spouse of !he deceased of such a spouse, to such other dependent relative as the (8)A complaint District Officer fails to settle the Court, proved, supplied Labour Officer within the mafler in accordance shall order payment that a se,·erance has not allowance been paid may be presented to a three months of its being due and if the District Labour to one month of its presentation, within 6-1 (2) or 6-1 (3), which. if the complaint has been ii may be referred with section of the amount due. " -Emphasis by underlining 35(1) of the Act refers to the First Schedule, which was worded as follows Section at the material time: "Length of Service Not less than one year but ten years exceeding not Not less than ten years Severance Allowance Payable two week's year of continuous service wages for each completed four week's of continuous service" wages for each completed year The starting that severance point in determining allowance payable this sub-issue under s. 35 of the Act is separate is to state what is obvious; and distinct which is from "redundancy payments" Conditions provided of m clause 3.3.0 of the Respondents Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, Service. is not a contractual all employees have a choice. operation An employee's matter. are entitled It is imposed entitlement Following to severance on employers Agency v. Jere [2008J MLLR 152 at 158. the enactment pay. It is not a matter in which employers by law: see Japan International Co­ to severance allowance under s.35 of the Act of the Act in 2000, virtually It is not uninteresting "redundancy Condition Condition to note that the two terms of "severance arc respectively As an example, The clause used in several clauses there is clause of Service. of Service. makes provision regarding of the Respondent's 3.8.0 of the Respondent's allowance" benefits" and it reads: gratuity and "3.8.1 ll'ho Employees contract Authority shall receil•e for any reason are not eligible for the Pension a severance pay when they retire by any Fund and are not covered of the or leave the service other than dismissal. 3.8.2 That severance of continuous " service. pay shall be one months' salary.for each completed twelve months terms was meant to denote different meanings. The drafter of of Service Conditions There is a long standing regarding The use of different the Respondent's variations. documents enjoined he or she must use different thing. In the apt observation 444,457: in use of terms. to use the same term or expression consistency words or expressions by Blackburn, presumption A drafter if he or she means the same thing and if he or she means a different J. in Hadley v. Perks [1866] LR 1 QB was not simply indulging in elegant of legal in interpretation of a legal instrument is "It has been a general which one is taught form of words used unless rule for drawing when one first becomes legal documents a pupil to a conveyancer, one times, never to change the .from the earliest you are going to change the meaning" See also the case of Selemani MLR 262 (HC), cited by Counsel in a contractual document maker of the document. and another v. Advanx (Blantyre) Mumba, for the proposition Ltd [1995] 1 that where a clause is ambiguous, the clause must be construed against the and distinct in my view that severance I am also fortified Act is separate of the Respondents of Service referred parte Khawela and Others [2008] MLLR 283 [Hereinafter "Khawela allowance payments" from "redundancy Conditions provided payable Case"]. by the case of the State and Another, under s. 35 of the to as the ex in clause 3.3.0 Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, The facts in Kwawela Case, as gleaned st January On 1 follows. in exercise Training, of powers conferred 2002, the Minister responsible for Labour and Vocational bys. 35 of the Act, promulgated the from the Editor's Summary thereof, are as among other matters, (Amendment) Order 2002. The Order revoked Act (First to pension, Schedule) and provided, Employment the First Schedule not entitled allowance the Order and that no severance entitled allowance, 284c tog, by Potani as provided J. arc relevant: calculated to pension, gratuity gratuity payable to such an employee allowance or other terminal shall be calculated shall be payable is severance that where an employee benefits, in a manner set out in is where an employee severance for in that order. benefits which exceeds The following dicta, at page or such other terminal decision was to avoid a situation in has been terminated would get double payment, that pay on the one hand and also severance about mainly comes sought lo address does not define Act in its entirety view and thinking. payment of pension. of severance pay. That line of benefits section the driving or gratuity is as good as pavment force behind the minister's in the minister's 35 and indeed the Employment benefits minister whose contract or other terminal pay. fl appears or other terminal in the view o(/he court is grossly "fl appears which an employee is, pension on the other hand .. The problem the because severance gratuity thinking Encor Products allowance from gratuity. before the amendment because pension. severance allowance as the minister's considerations, conferred sought to do something This is to the schedule the power to amend conferred gratuity or severance ll'hich intention might pe,fectly made by the minister by the law. To borrow the word� of Counsel which is morally a court of law not one of morality. This Court is mind/iii is a distinct the decision el'l'oneous as the learned Judge in Alufandika said that severance v phenomenon Ltd Civil Cause No. 3828 of 2000 (unreported) altogether that the decision was made. The position. upon the minister in the Alu(andika however. from pension. case was made does not change is not to amend the meaning of indeed ii is also different allowance but simply cannot be the same thing as pension lo amend the mode of calculating he right on economic or gratuity. Thus, much and moral the power the power exceeded for the applicants, right through the minister the backdoor. and economically " Potani. in the Khawela Case, the arguments I cannot agree more with His Lordship Respondents respect primarily of the Constitution the prescriptions of his research on moral and economic to determine by the Just as was the position Nkhono SC (with all by Counsel presentation of them) are and his persuasive by s. 9 is enjoined facts and relevant to the product premised grounds. This Court cases with regard only to legally of Jaw. Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. to the present Turning of s.35 of the Act (the adequacy of Ground of Appeal No. 3 discussed below) allowance of the paid sum is the subject matter but they were not paid redundancy case, the Appellants were paid severance or otherwise in terms as outlinec! benefits for pension. that the Appellants Rules went unchallenged. in Clause 3.3.0 of the Respondent's is to be excluded were paid pension sums in evidence accordance because the Pension Conditions save of Service by Mr. Harrison Banda Scheme with Pension it is my holding In the premises, that is, three months' salary in lieu of notice and refund of own pension contributions Rules. plus employer's enter judgment in accordance as follows: that each of the Appellants was contributions for each Appellant I, therefore, with Pension paid notice Fund pay, (a)one month's salary for each completed year of service with the Respondent (not service with the Government Depa1tments); (b)payment of outstanding leave days, if any; and ( c) payment of outstanding overtime hours, if any. It will be observed months' with under Ground of Appeal No. I. salary in lieu of notice". that the judgement above does not include This is because the same has already the issue of "three being dealt GROUND OF APPEAL NO. 3 assert The Appellants interpret the notice pay and Respondent's redundancy conditions benefits. that the lower court erred in law in failing to properly of service on the payment of severance pay, Counsel law: Mumba prefaced his submissions with the following general statements of (a)when interpreting the plain meaning Malawi f 1992) 15 MLR 452 (HC)); a contract Sichinga of the words used: or a contractual term, the court looks at v. National Bank of ( c) parties to a contract they are not allowed are bound by its to renegade from it: Nigrisoli and te1ms. Once they sign the contract, Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. (d)Another v. lllomba Granite Company Limited and Others (Civil Cause Number 1111 of 2005) (2008] MWHC 194 (4 November 2008) and MC Cutcheion 134;and Ltd [1964] lWLR 125 at v. Macbrayne (David) (c) where a clause in a contractual document must be construed against another v. Advanx, supra. the maker of the document: the clause is ambiguous, and Selemani The preface is followed by a detailed analysis which it is apposite to set out in full: "6. 4. The Conditions between for a specific payment months' sala,y of Sen·ice were drafted by the Re:,pondent. the Appellants and the Respondent. regime of compensation The Conditions of Service in case of redundancy. They formed contract provided This included at four calculated of three months' notice pay and severance allowance for each completed year ofsenice. 6.5. [6.5 to 6.8 relate to the issue of ex grafia payment discussed above under Ground of Appeal No. 2} 6. 9 lo severance termination 011 sati:,fied entitlement and gratuity, long term service of the contract (see the State vs Attomel' General The employee's such as pension employer as distinct Vocational Training) 200-1 (HC)(PR) of 2001) [2002} MIVIRC 27 (20 Februa,y industrial (unreported). Relations ex parte Khmve/(J and Others, In Zamaere v Sucoma Limited 2002) the then Chairperson (MATfER NO. 157 of the Court made the following observations: and her entitlement benefits. of employment etc provided by an are recognised to other benefits (Minister of Labour and Misc Civil Cause No 7 of indica1ed 1ha1 payment in lieu of notice, award are 1101 10 he affected in/ended en1i1/ement 1h01 ii ne1•er by 1he payment !hat payme/11 10 other paymems, a contrac1 of employment of sever1111ce of severtmce such as pension, compensatory allowance, allowance gratuity that 1ha1 provides to terminal enlitleme/11 shall aflecl 1he employee's not aflecl expressly 'Parliament, having award and special ought to be 1111ders1vod the employees should or Olher terminal benefits paymenl benefits Employme111 allowance. documems of severance does 1101 1·iolcue /1 is up IV 1he employer are har111011i=ed allowance !he letter 1ri1h /11 olher words. Acl has pul in place is a minimum sla/11/ory requirement on severance of employment and spiril of the Employment Act. What the the requirements of 1he Employment Act.· to make sure tho, 1heir con1rac1 6.10 Thus an employee's entitlement to gratuity and pension benefits does not affect payment. Therefore severance redundancy Service. or productive alloll'ance y are entitled ll'hich the ll'Ollld interpretation of a disproportionate benefits An othenrise counter Appellants to receive are supposed to get the under the Conditions of anomalous "artificial" be '"illogical" mischief Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. 6.11 Further or in the alternative, its maker (Wltite Warrick v Jol,11 Trustees o(tl,e Clturclt (HC), per Mbalame J Selemn11i MLR 262 (I IC) per Nyirenda, of Disciples J as he then was. an ambiguolts contract has lo be construed against & Co Ltd {I 953 I 2 All ER 1021; Registered Export Co Ltd (199-17 MLR 280 ltd (19957 1 (Bla11tvre) v Produce a11d n11otlter v Adva11x 6. 12 In construing o(Disciples the following observations: the contract against v Produce its maker in Registered Export Co Ltd {199-17 MLR 280 (HC), Mbalame o{tlte Clturclt J made Trustees .. ,, is understandable bw in my j11dg111e11/ lhe =ero, it should before court lo belie,·e. and if they made it unclear In any eve/JI when one ll'rites that metrication is not a system .. 0.55, .. e,•en in the absence read to mean 55t and not V,1 as the defendants of the sign "Kwacha" would wish the we have had for a very long lime, /he defendants were the drawers of /he contract or ambiguous the doc11ment 11111H be construed against document them". 6. 13 If, which is denied, 3. 3. against owlined becaltse Trustees in terms of inter a11d a11otlter the Conditions they were not intended at Clause 3.3.0 means severance the Respondent Act. Clause 3.3.0 4the Conditions alloll'ance The payment 0 does not state that it is supposed of Service he construed & Co ltd {/9537 2 All ER 1021; Registered Export Co Ltd {I 99-17 MLR 280 (HC), per v Produce Ltd {I 995 7 1 MLR 262 v Adva11x (Bla11tvre) to comply with the did not !/Se the term the of Senice are not clear as to whether Redundancy benefits comprehensively pay, then the same sholtld alia White v Jo/111 Warrick o(llte Church of Disciples Mba/ame J Selema11i (I IC). C!altse Employment severance allowance. payment Act. it has to be covered redltndancy is not regulated recognises limited would produce as Zamaere v Sucoma Limited of Labour a11d Vocatio11al decided. severance provided Training) good law. The Respondent These cases represe/71 allowance twice. The Respondent ll'ou/d of Service. in the present and that of State vs Attomev General claim for The basis of the Applicants' of gratuity Actually of Service. Act yet the case of Zamaere v Sucoma of the benefits which is not Sllpposed would not pay pay as pay redundancy of redundancy that cases such Olltlined to be provided (Minister and Others were wronglv to cater for severance for in the Employment for in the Conditions such payments. is on the Conditions by the Employment To argue that payment at Clause 3.3.0 is akin to case is like arguing an absurd reslllt ex pa rte Kltmvela by contract. of gratuity henefits benefits payment 6. 14 We submit that fwd the loll'er court properly directed itself it would not of have dismissed of contracts, in terms of redundancy benefits to the Conditions calculated 'sprayer and case law on interpretation for the payment Service the appe/la111 of Clause 3.3.0 of the Respondent's Conditions dismissed lower court properly directed would have been resolved v Adva11x anotlter of Service. of notice Conditions of the Appellants f to the itsel in favour Ltd [rnpra !. " for the payment (Blant)'re) the Appellant of Service, 's prayer it would also have not had the pay. Further, all ambiguities in terms of Selemani and Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. Here again, the Respondent However, as is usually in this ground of appeal of arguing the other grounds did not directly the case in were dealt with by the Respondent appeals address of this nature, this ground of appeal. some of the issues raised in the course indirectly of appeal, that is, Grounds of Appeal No.s 1 and 2. I have considered understanding, Appellants allowance, wrong formula pleaded notice the respective submissions the case or the Appellants and in fact submitted on this ground of appeal. To my under this ground of appeal is that the that they were underpaid pay and redundancy benefits in that the Respondent for calculating these items. It is thus prayed that this Court should severance used the proceed commercial to order that the Appellants bank lending rate. be paid the shortfall at the with interest The main thrust entitled is that the Appellants to be paid these items and they were paid the same at the rate stated of the Respondent's were indeed in the argument schedule completed salary in lieu of notice" in respect of notice pay. to the Termination year of serv;ce" that is, "One month's allowance of severance in respect Letter, salary for each and "Three months' On the face of it, the payment year of service" completed requirement service, completed severance service under s.35 of the Act to pay employees, depending on length of allowance in that one month is 30 or 31 days whilst wages for each year of four weeks is 28 days. two to four weeks' or between by the Respondent of "One month's salary than complied for each minimum with the appears to have more The vexing question Act. The Appellants them such as medical 1. the IRC Form has to do with the meaning take the view that wages have to include of wages as used in s.35 of the all allowances due to 5.46 of see paragraph aid, leave grants, house allowances: question the decision confronted with a similar Court of Appeal was of the I ligh Court which upheld the decision of the High Cou1t that the terms "wages" broad to cover allowances The Supreme Bank Ltd v. Mtukula [2008] MLLR 54. In this case, the appellant against Registrar Act are sufficiently car allowance, telephone appellant "pay" are restricted Supreme or basic pay only. The appellant the lower court's bank had argued that upon a proper to basic salary night guard allowance, and security such as official water and electricity, alarm system. The the terms "wages" and bank asked the Court of Appeal to reverse in Stanbic bank appealed of the Assistant night guard allowance or "pay" which appear in the garden allowance, Having considered construction, and other benefits allowance, decision. Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, the Supreme a host of authorities, the lower coutt decision "remuneration" basic salary. Court of Appeal dismissed the appeal that the terms wage", "salary", and include and upheld "pay", and and benefits allowances, are used interchangeably In the present the severance allowances some allowances wage system" in complaining redundancy benefits same. In short, case, the "wages" or "salary" allowance and other benelits were restricted such as medical used by the Respondent in calculating to the basic pay; they did not include aid and leave grants. In so far as and other benefits were not included in the basic pay, the "clean argument docs not hold. In the premises, that they were underpaid as the Respondent severance used the wrong formula allowance, are correct the Appellants pay and the for calculating notice there is merit in this ground of appeal. Chapter provides allowance, occasional 8 of the Respondent's Conditions for eight types of allowances, deals with allowances of Service namely, subsistence allowance acting allowance, and lecturer allowance, disturbance Out of all allowance. kilometreage allowance, and it travel allowance, housing meal allowance, these allowances, paid as part of monthly it is only the housing salary. allowance that is relevant in that it could be Clause 8.7.0 of the Respondent's allowance and it provides as follows: Conditions of Service deals with housing "All employees ro be determined institutional value of rent for a particular house not housed by the AuthorNy by management house shall be deducted rentals to be determined from time to time. An employee monthly from the salary by management at the rate occupying equivalent an to the shall receil·e Allowance fi·om time to time" !lousing On the basis of clause those Appellants housing allowance severance allowance, factored notice that were not housed 8. 7.0 of the Respondent's Conditions into their respective salaries it is only of Service, to have that are entitled when calculating by the Respondent pay and redundancy benefits. the Respondent For the record, but avers that the same was being paid to the Appellants monthly Submission This is to be found in paragraph docs not deny that housing in the lower court: Appellants salaries. allowance was payable as pa1t of their respective 12 of the Respondent's Final "Mr. Nyirenda Evidently, stopped claimed a/I that happened breaking dol1'n, that the respondent fro:e the payment allo,vances. ll'CIS that the respondent introduced in the payslip, between basic salcuy and housing allowances. of housing and a clean wage system It Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. set out an enlry for "housing appears allowances", that because the payslip no longer spec(flcally allowance housing allowance, Mr. Nyirenda believed allowance notice was included pay and redundancy aid and leave notice allowance, severance it is only medical The fact that housing severance the premises, account payable appeal in calculating to the Appellants. In the premises, of these two items, the underpayment under pay and redundancy this ground of aid and leave grants. that is, medical benefits was only in respect had been abolished. " in the basic pay used in calculating was not controverted. not taken into that were benefits grants In GROUND OF APPEAL NO. 4 allege failure on compensation The Appellants Appellants of the fact that the Appellants and in view of the fact that most respective retirement ages. up to the Appellants' trained the part of the lower court to award to the ages in view respective by tbe Respondent retirement were purpose as admitted of the Appellants had few years remaining to their Mumba submitted Counsel Court should award must be what the Court considers that compensation employee that the and by the must be aimed at making good the loss suffered that the law requires that the compensation to be just and equitable as a of the case. He has buttressed contract breach of the of the employer's result all the circumstances authorities several The Attorney-General the "Chawani Civil Appeal (Unreported) Case"] and General Sirnwaka No. 6 of 2001 (Uudgement [Hereinafter [2000-2001] including refc1Ted cases by the Supreme to as the "General delivered to as MSCA General, on 241h November, Sirnwaka Case"]. 2009) of employment taking his submissions Court of Appeal in Chawani v. into account by citing v. The Attorney MLR 77 (SCA) [Hereinafter referred The Chawani Case was mainly cited for the following Tambala, Appeal at page 12 and 13: JA (rtd) in delivering the unanimous opinion observations made by Couit of of the Supreme is clearly ji-0111 at an average "The appellant that is, from 1 April, increments salary increment inflation annual increments the increments of seven years, e11titled to salary for seven years. seven months and ten days, 1997 to 10 November, 200-1. I April, 200-1. 1997 to 10 NcJ\'ember, Ile is also entitled, The appellanl per annum. Considering in our view, to sala,y claims the prevailing rate of 20 percent depreciation and the continuous of the local currency, we take the view that at 20 percent per annum are reasonable. The appellant is entitled to at that rate. I le is further seven months and ten day s. The appellant entitled to leave grants covering the same period on these damages is awarded Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. the ground that, under the contract obligation a sala,y, to pay the appellant of employment, annual salary the respondents were under a legal . and leave grants increment is also directed .from 1 August, to calculate gratuity I 972 to 10 November, and pension 200./, taking for the salwy covering based on the salary into account the period .from what has be subtracted increments at the rate of 20 percent 1997 to 10 November, 200./; .from the resulting sum must ... The Registrar covering the period annual salary 1 April, already been paid lo the appellant appellant November, must also be paid leave grants for the period between 200./ ". and gratuity; as pension he must be paid the balance. 1 April, 1997 The and JO Counsel public servant's compensation Mumba submitted employment as follows: that the General Simwaka Case held that where a to paid he or she is entitled terminated, is wrongfully (a)an amount of salary between representing salary the date of termination the period date when he would have attained mandatory of employment retirement; he would have earned during and the (b)salary increments covering and the date of mandatory the period employment; between and the date of termination (c)gratuity and pension based on salary to the date of mandatory retirement which could be earned from the with together date of employment increments. salary that there are common features Mumba contends Counsel Case and the instant private prescribed less than eight years to retirement. entity), minimum retirement (b) the Appellants were officers, public age of 55 years and (d) some case in that (a) the Respondent is a public between institution the Chawani (not a (c) there was here a had of the Appellants Counsel Respondent trained: Mumba also invited the Court to have regard to the fact that the admitted before the lower court that the Appellants were purpose Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. ll'ere purpose "As the Appellants that would employ the Appellants less rhan eight years to rerirement !he lower and yearly increments Supreme Court of Appeal in !he case of General followed f CJ,mvani v The Attomev trained coupled up to re1iremenf courl ought lo have awarded age in lerms of !he decision Simwaka v the Attomev [supra/." General the case o. had compensalion of !he Malawi which General and as the Respondent with the fact that some of the Appellants is the only institution Counsel following Mumba concluded view: alternative his submissions on this ground by advancing the the sala,y used in calculating compensation or in !he allemative should have been the salary at the time of assessment, "Further Appellants earning one which they ll'ere fact that the currency earning lost value due to massive to the grades were in similar not have been should in the year 2010 owing to the in the year 2012." al the time of their dismissal thar is, the year 201./. The sala,y which their colleagues devaluation What lies at the heart of the Respondent's is based on a statutory such statutory compensation payable specifically to an employee In this regard, provision. provision, provided submissions is that where compensation the court should be careful not to step outside Counsel Nkhono SC submitted who has been unfairly dismissed that 1s for under s.63 of the Act which is worded as follows: "(/) If rhe courl finds that an employee's complain/ ii shall award rhe employee remedies one or more oflhe.following of unfair dismissal is well founded, . (a) an order for re-instatement whereby 1he employee is to be treated in all respects as if he had no/ heen dismissed; (b)an order for re-engagement whereby ro that in which he was engaged work comparable olher reasonably ll'Ork suitable as may he spec(fied employmenl from such date and on such terms of in the order or agreed by the parties; the employee is to be engaged prior lo his dismissal in or and (c) an award of compensarion as specified in sub-section (./). (2) (3) (./) An award of compensation in the circum.1/ances of the dismissal in consequence and the extent, taken by the employer just and shall be such an amount as the court consider by the having regard to the loss sustained lo the if any, to which the employee caused as the loss is aflributable in so.far equitable employee action or contributed to !he dismissal. (5)The amount to be all'arded under subsection (./) shall not be less than: Charles Mwasi & Others v. Malawi Revenue Authority J. Kenyatta Nyirenda, (a) one week's pay for each year of service for an employee who has served years; for not more than.five (b) two weeks' pay for each year ,�{ service for an employe e who has served for more than five years but not more than ten years; (c) three ll'eeks 'pay for each year of service for an employ ee who has served for more than ten years but not more than.fifteen years; (d) one months' pay for each year of service for an employee who has served for more than fifteen years, and an additional the reasons amount may be awarded in s.57(3) set out where dismissal was based on any of (6) Where the court has made an award of re-instatement or re-engagement and the with by the employer; award of an amount equivalent to twelve (I) and (5). under subsections award is not complied special compensatory Nkhono SC called all'ard the employee shall be entitled weeks' wages, in addition to a to a Counsel Act. He submitted instatement special or re-engagement that as the lower court did not make any order for the re­ to a none of them was entitled award under s.63(6) of of the Appellants, the Act. upon the Court to be faithful to the text of s.63 of the to a compensatory award under s. 63(4) of the Act, Counsel With regard SC contended by reference reliance that nothing therein to an employee's supports prescribed namely, Nk.hono of compensation payment minimum retirement age. calculated He placed v. Limited DHL International on two High Cou1t cases, Civil Appeal I-IC/PR Aubrey Nkhata, the "Aubrey Nkhata Case"] HC/PR Civil Appeal No. 87 of 2004 [hereinafter Mwafulirwa The Aubrey Nkhata Case is discussed on Appeal as follows: Respondent's to as No. 50 of 2004 [hereinafter and Manica Malawi Ltd v. Morton Mwafulirwa, referred to as the "Morton in paragraphs Submission 8.4 to 8.8 of the referred Case"]. "8. -I With regard lo whal is jusl and equitable, the I ligh court of Malawi has said in v Auhrev Nkhata Principal Limited the case of Dill /11tematio11al Appeal No. 50 of 2004 that the court must look at the circumstances of each case. Registrv In Iha/ case, the courl fur/her Relations approach regard to human rights, Ac/ and the Constitution in Malall'i to labour relations freedom including of the Republic of Malawi have changed the have and that the court must therefore of association, workers' participation recognised that the Employ menl Act, the labour Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. and equity. peace, advance Cenlra/ to this constitutional and legislative is industrial men/ of.social justice and economic framework development. 8.5 In that case (of Dl/L International to consider Limited 1he cases of CJ,awani of the U11iversitv occasion 18 of 2000, Council No. 38 of 2003, /lfacpherson Cause No. 2719 of 1978, MRA v Everton and Em est Mti11gwi Twea J (as he /hen wa.s), v Nkhata), /he High Court also had MSCA No. v The Attomev MSCA Limited Mpaso Civil Appeal No. 59 of 2004 v MRA Civil Cause No. 3389 of 2004. The high Court per of Malawi v Urban Mka11dawire Civil Nelson Mago/a v Press Corporation lo these cases /hat: said wilh regard General as they are conji,sing, cases are as ill11111i11ali11g in my assess111ent of !he cases, I and those 1ha1 have are based on the common law approach lo employ111e11t The case of Mago/a & Others were also based on the common law but the '"these find 1h01 they can all be dislinguished. followed it obf,galions. High Court had attempted rights. to fuse the curren/ E111ploy111ent The court hased its vil?l1 on an English Act that has since been repealed. The case of Ctrnwaui and con/ractuaf Act 2000 in interpreting the It is pert111ent why they ignore of /lftiugwi, interprel articulated !he Employmenl in !he case of llfpaso. 10 note !hat 111 these cases. Employmem !he courts Act when computing the current have not co111e awards. 011 the interprelation 1he court relied hem•ily up clearly Lastly, of the const1tutio11 on how or in the case in frying cases are well Act. The prohlems raised hy these various to of Chipeta ./ that !he approach short of inlerpreting but he stopped what ll'011ld It is clear from the judgmenl much to be desired, in deciding approach Mpaso however, lem·es conlracts of employme/11 Appeal earlier, on the proper approach no douht that the applicable are concerned is as interpre/ed case. This, in the Clunvrmi I find that these cases can be distinguished. however, of !he lower court leaves or proffering the proper The case of in !he circums1a11ces. and Court of is as far as case authorilies law as far as comracts by the Malawi Supreme go. As I said to shed some light be jusl and equitable I will now al/empt " 8. 6In the same case, Twea J (as he then was), then cited with approval a statement made by the /11d11slrial Relations Court that: of rnch compensation the objecm·e ··of course overnight punishing should lem·e or leave him or her poorer. the employer. What the court will strive happ hmh parties y and feel that justice lo aim at is to strike has been done". At 1he same time, the court should not aim at is not to make 1he employee richer which a balance 8. 7 Fur/her, T1rea J (as he then ll'as), in that case said that the lower court found that the appellant may stand alone or together. These for specific "Further. Employment Act in s.63 pr01·ides remedies award of compensation reinstatemen/ award of compensation as to why the remedies the approach Subsection subject In the preselll or re-integration for unfair was liable remedies The dismissal. The same for unfair dismissal. or an re-integration the award of considering finding are reinstatemem. the court to first consider he/ore conditions to some slated case, the court did not make any specific It should were not appropriate. have done so. I have considered of the lower court to the award of compensation (2) enjoins I noted that the approach espoused by this court in 1Upaso's was not properly articulated. case. S.65(./) requires The proper is as the court lo make an award of approach ----------------------------------------- Charles Mwasi & Others v. Malawi Revenue Authority J. Kenyatta Nyirenda, compensation decision, it 11111st take into account three factors: that is 'just and equitable in the circumstances". When making such a loss sustained by the employee consequent upon dismissal; Whether the loss can be allributed to the action of the employer; and The extent of/he employee's conlriblllion to the dismissal. minimum that the court may of the court in respect of the three above (5). I bear in of case where the interpretation of subsection adjust (5) therefore gives the mandatory on the finding the scale upwards Subsection award. " Depending factors, it may mind the findings s.63(5) was raised. does not make an order below what is stipulated order is not necessarily wrong is exercising its discretion reasons. judge in Mpaso's of my brother in respect I hasten While I agree with the judge ·s view that as long as the court to say, howerer, that whenever in the said subsection, then the the court it must give to move away.from the minimum threshold, of the court should not be arbitrary. It is not open to the court to It should decided be clear, to enhance The decision award any sum as it wants. al/01red. the court In the present case authorities. several salwy , loss of ji-inge benefits, pension allowances, that the court misled heads reveal The listed The court must award such sums as would by law, be on the record, to the employee, employer and all why the minimum stipulated in s. 65 (5). the Mago/a case and some English the award from case, the lower court followed heads under these include house allowance, utilities, f loss o immediate guard mobile phones, these From a glance, contributions and future earnings. itse(f on this issue. 8.8 The court in (Dlll /11ternatio11al limited v Nk/,ata) went on to state that the court should not split heads of compensation tenets of the definition there.fore look at of "remuneration" and not split them. all earnings together and that to do so ignores and "wages". the basic The court should In that case, the court took particular which the employer stopping of the very high handed manner in the employ ee and even the employee; humiliating The months. for twelve employment treated in engaging the employee in similar notice court also commented "immediate loss". on the award by the Industrial Court of Relations With regard to the head of compensation called was then), said: "immediate loss" Twea J (as he to not,ce this is not allowed "in 111y 1•ie11•, termination Such payments 11111st discretionwJ'. It is clear thal the law did not intend s.53(/). hardship. financial Further. this court criticised this is 1101 par/ of our law as it slcmds" award of "future An award of "immediate pay and severance allowance on under the law as it stands An e111ployee not with 1s entitled are statutory and which payments be ejfec1ed wuhin seven days in accordance the employee loss·· earnings" is not part of our law. in the case of Mpaso. Clearly, should therefore suffer 11nnecessa1y The discussion follows: by Counsel Nkhono SC of the Morton Mwafulirwa Case is as Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. "8.11 Further, the courl should obtain useful guidance from the case of Manica Malawi Ltd v Morton Mwafulinva lliglt Court Principal Registry Civil Appeal No. 87 of other things, in so far as spec(fic sums 2004 where, among to the notice type offuture of such future 2 and 3 !hereof period loss is reflected loss. In Iha/ case the High Court, that: the court says that the future are concerned by a general award if there is evidence per Kamwambe J, said at pages of the reality loss claim re/ales and !hat any other of compensation and exle/1/ upon to adjudicate on the nature f a court finds tho/ an employee's Iha/ i 63 of the £111ploy111e111 Ac/ which prol'ides ii shall award one of the following is well founded, dismissal of unfair payable under "I am called section complain/ remedies:- (C) cm award of compensaJion as specified in subsection ./ ... " Further. at page 8 of the transcript of the judgmenl, Kamwambe J. said: the just and equitable principle Jhe minimum 1/101 Jhe court may award where an employee to sectwn 63 (5) of the has 111 relation financial "When we are applying Ac/ which provides sustained include future dismissal. car or fuel salWJ'. pension. conlractual in na/ure items capable paid as a mat/er for general of "of course". loss only in the eve/11 loss, you are considering general loss and loss of securily, damages conseque/11 or unquantifiable losses which may If you marry subseclions (./) and (5) /hereof. allowance, house allowance, of quan1ifica1ion are no/ envisaged 1herei11, and would be reslricled What 1s awardable that dismissal ajler all they are specific to notice period 1mder subsection is unfair. upon redundancy or unfair as you find /hat such things aid elc which are compensatory and would be medical (5) is compensalion suggests in Norton Tool Ltd Co. !he possible dismissed; As suggesled president has been unfl,irly wages; (c) the manner of dismissal by reason of dismissal already no/ice lally wilh will squarely employee Limited, under 1he E111ploy111ent period. come under subseclion Civil Cause No. 542/1995. was considered or dismissal said ll'ill by following v Tewson /1973/ 1 All ER 183 The four heads of compensation where an employee thus, (a) immediate loss of wages (b) future in respect and (d) loss of proteclion redundancy. The firs/ hereby is whal I have loss of of unfair On the other 5. Under fu/ure !he Kalinda hand, !he olher two heads loss head, it seems the v Limbe Leaf Tobacco Ac/, I.feel we would be safer to restrict Where we are dealing with compensation our consideration under sub.see/ion loss must he considered under 1he Ac/ only and no/ on cases that occurred fi11ure say the respondenl and olher employment, 200./. Subseclion under !he subsection need no/ have been awarded beyond 2 ls, April, so thal he is paid salary to be considered benej/1.1· \1'hen for an exlra three months up to 21st July, 1he minimum compensation". computing the Act. In my view any he.fore 5. In !he same breath compensalion I should for loss of salary 5 of the Act would not perm ii !his since ii requires 200./ uni ii when he found allernative Counsel Nkhono SC submitted Nkhata Case and Morton Mwafulinva order payment of compensation calculated Case, the court below rightly up to retirement age. It was also argued refused to that on the authority of the two cases of Aubrey Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. that the compensatory salary is more than just and equitable in the circumstances: award to the Appellants of the equivalent of 30 months' "8.10 From the periods of service to the court below, none of the applicants years. Consequently, two weeks' pay for each year o_(service. under section set out in the document served jointly provided for a period of more than ten was 63(5) (b) the compensation calculable by the parties fell under s. 63 (5) (a) and were entitled Some of the applicants one week's years. in the circumstances compensation to the appellants. pay for each year of service, for having served for not more than.five the court below went beyond what was fair '' to compensation of respective considered the by both Counsel, I fully on by the Nkhono SC that most if not all cases relied Having carefully agree with Counsel Appellants Simwaka Case, are not directly relevant compensation" the Chawani Case and the General on this ground, under s. 63 of the Act. submissions to principle including of ''just and equitable prior to the Act coming into Notice No. 4 7 of 2000. There is no after the commencement date that the Chawani Case was decided 2000: see Government It will be recalled force on l 51 September doubt in my mind that had the Chawani Case arisen of the Act the compensation compensation" that principle, entitlement, must take care not to regard cast in iron until retirement. in the Kachinjika benefits a contract /\s was aptly observed an unfairly dismissed to be paid retirement principle Case page 178: employee as stated would have been based on the "just and equitable ins. 63 of the Act. I am not persuaded that under can claim, as a matter of unqualified up to the time of retirement. for life or one as a contract of employment The Court by Chikopa J., as he then was, is untenable. not worked up to such age, but there is also no bankable is that not only "Any way you look at that argument that guarantee has the plaintiff he would have worked up to such age. He would have died, could have resigned, and could have been properly find other that the Plaint([( will employment gainful work which as if he retired at the same terminal benefits the normal age. " terminated. will extend The truth of the matter it is also possible the lower court did not err in law in ref using to pay the or until their future wages for the rest of their respective lives n the circumstances, Appellants respective compensation I decline J\ccordingly, retirement up to their respective retirement. to order that the Appellants be paid ages. GROUND OF APPEAL NO. 5 Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. It was the case of the Appellant wrongly exemplary dismissed damages. under this ground of Appeal that the tower cou1t the Appellants' prayer for the payment of aggravated and Counsel 3 of OAC where the lower cou1t stated Mumba prefaced thus: his submissions by drawing the Court's to page attention "This court is not in the habit of awarding exemplary for the loss suffered in this court is to compensate " employment. damages. The aim of compensation due to the termination of the Mumba submitted Counsel award aggravated the case of Banda v. Dimon (Mw) Ltd 2008 MLLR 92 as an example aggravated given by the lower couit for declining does not find support that the reason damages of matters. in employment and exemplary and exemplary in law. He cited being awarded damages to Ltd, supra, of nine months as a computer the plaintiff or who was run by white South African and files programmer managers had worked for the work. They took away the plaintiff's computer The defendant the plaintifrs In Banda v. Dimon (Malawi) defendant's for a period company systems analyst. obstructed and moved him from one office to another office home where he had no printer. United States account so. The plaintiff dismissed that due to the dismissal The comt other benefits. allowances sued the company claiming through He was prevented (his former managers). when nobody else in the from employmenl found in favour of the had been deprived the plaintiff of America for travel until he was forced to work from from submitting his reports was forced to The plaintiff to do was required company that he had been constructively to the the defendant's unreasonable conduct and and allowances of a salary, plaintiff. Counsel Ndovi, observations J. in awarding exemplary damages: on the following Mumba placed emphasis that were made by "In a no fault situation like damages is entitled work, the plaintiff in this pathetic to exemplary case where greed and racism I le at to the tune<?( 3 years' salary. were clearly have worked up to pensionable should and fear of Africanisation by misguided f age i it ll'ere ". individuals racial not for deliberate practices Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. Counsel Mumba contends proper case in which exemplary contention was framed as follows: that, on the facts proven before the lower cou1t, damages should have been awarded. this is a The Following and subslcmlively unfair. the Respondent ''The lower courl found thal lhe lerminalion procedurally employment, new employees. carried Respondent institutions not to declare /hat aggravated this case." redundant damages would The Respondent and exempla,y employees is a public went on a recruitment out are /he worst of all. A clear message of lhe App ellants' employmenl !he termination spree replacing was bolh of the Appellants· wilh the Appellants which the The redundancies inslilution. should be sent to public just for the sake of it. We thus submit be appropriate in the circumstances of The Respondent Nkhono SC submitted attack took a two-pronged against this ground of appeal. that where a court finds that an employee Counsel has proved unfair dismissal, that: s. 63 of the Act sufficiently provides for remedies. As such, he argued therefore for unfair compensation "it is not necessa,y question of remedies award such is what the court below, of /he respondent's there was no unlawfulness for the court to take an over :ealous In particular, dismissal. the court is given power in the circumstances. approach to This just and equitable to lhe as it considers more than did. Besides, ii is clear that whatever of the employment of the appellants terminations on 28'h July, 2010, view one takes or arbitrariness or high-handedness. Further, " Others above cited. all was lc111ful on the basis of First Merchant Bank v Eisen/tower Mkaka & not too The second prong is that the concept should readily case of Rookcs v. Barnard [1964] l All ER 367 wherein that might attract categories is one that a the Court to the Lord Devlin sets out damages damages Nkhono SC referred an order for exemplary seek to use. Counsel of exemplary of action court as follows: action than another. by the servants 1 should not extend is oppressive, by corporations -1 say this with particular or unconstitutional arbitrary this category, action "the first category government. the facts of this case;-to an oppressive man is more poll'erful gain his ends; and if his power is much greater than the other's; pay for he must of course power illegally, said to be using it he is the because simply his illegality he is not to be punished more powerful. for the servants it is different, of the people and the use of their power mus/ always be government are also sermnts subordinate about a repugnant lo their duty of service. of humiliation big man bullying of to Where one that he will fly lo use his power lo he might perhap s be ii is true that there is something will be a source in the case of government a small man and very likely or individuals. oppressively. ff he uses his it is inevitable in the ordincuy the bullying reference way; but f the o so Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. that makes the case one for aggravated by damages. damages, but it is not in my opinion punishable by him lo make a profit to the plaintiff has calculated Cases in the second catego,y calculated payable rights exceed the damages with impunity .... . . . teach a wrong doer thar tort does not pay. are those in which the defendant's which may well exceed disregard has been conduct the compensation for a plaintiff's ......... Where a defendant with cynical that the money to be made out of his wrong doing will probably for himself at risk, it is necessary Exempla,y damages can properly for the law to show that ii cannot be broken be awarded when it is necessary to To these two categories. be added any catego,y course . . . . . . statute which are established as part of the common in which exempla,y damages law, there must of by are expressly authorised damages must be presented damages; that it can he brought and the judge should Thus a case for exempla,y compensatory is satisfied fact that the two sorts of damage differ essentially should be two awards. should be directed rhat compensation defendant has behaved the categories (which may of course be a sum aggravated within from one for not allow ii to be leji to the jury unless quite differenrly he which I have spec(fied. In a case in which exemp/a,y damages if, hut only if, the sum which they have in mind to award as are appropriate, But the mean rhal rhere a jury does nor necessarily by the way in which the is inadequate lo the plaintijj) disapproval some larger of such conduct sum. " to punish him for his outrageous and to deter him ji·om repeating ii, then they can award conduct, to mark their that the lower cou1t did not find much jurisdiction or use for it being a court dicta, damages (a) constitute a province available On the basis of the above-mentioned exemplary upon, (b) is a device generally device whose remit is strictly fleshed such as for facts obtaining 646. Counsel case are wholly within Act, and ( d) should inappropriate as out in Labour Relations circumscribed SC concluded in Munthali Nk.hono Counsel a court should that SC submitted be very slow to enter Nk.hono to the comts at common law, (c) is a s. 110 (2) of the Constitution and as v. Attorney General 11993] be confined cases to egregious 16 (2) MLR by submitting a case attracting that the circumstances an order for exemplary of the present damages: that the manner in which the appellants' employment seek to suggest rises to that le,•e/. "The appellants was terminated of the applicants' manner of termination agency of Government should I have considered Counsel " submissions the respective nor cloud reasoning. IVe disagree. employment. Ltd is Nkhono SC that the case of Banda v. Dimon (Malawi) and I am inclined to agree with There is nothing extraordinary in the The fact that the respondent is an Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, distinguishable. consideration in that case quite correctly of contract deserved of employment as the Court did in that case. A breach The circumstances a different of the desire motivated racism discrimination because Produce (RBDA) [2002-2003] ODA Ciat, BC/Lilongwe (unreported). Further, as was Attorney General, observed rightly supra: gone through damages, "Exemplary however, the damage he has suffered; " waywardness. I have painstakingly of malice, evidence Respondent. award of exemplary employment not call for redundancy: "unilaterally and without has to fai I. ground of appeal damages: by malice or ill will or such other malevolence, be it on account of or such other practices, or calculation ought to be addressed differently suffering: see Dama v. Eastern to inflict MLR 50 and Lero Munthali v. The Malawi District Registry Civil Cause No. 602 of 1996 by Mwaungulu J, as he then was, in Munthali v. are not necessarily they are more a punishment a compensation on the defendant to the plaintiff for for ill-will, oppressive As such, I am not convinced the facts of this case and I have found no on the part of or high-handedness calls for the action matter that the present this was simply a case of unfair it is just that the Appellants' services of consultations". In the premises, due process this of termination situation did were terminated per se. It is not as though the lower court found that the GROUND OF APPEAL NO. 6 On this ground of appeal, making determinations contend the Appellant were not pleaded on issues which lower court erred in law in by the Respondent. that the The position all the issues with the Respondent. placed surprise this ground of appeal As a matter appeal. of appeal. this ground before that of fact, of the Respondent that the lower court pronounced judgment is that it is the Appellants who raised agree more themselves upon. I cannot it by the Appellants Every single issue that the lower court determined themselves. It, therefore, did not come as a was was not pursued even the Appellants' by the Appellants Skeleton Arguments did not cover at the hearing of the Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. GROUND OF APPEAL NO. 7 The issue of mitigation by Appellants submitted had failed to mitigate their Appellants that the lower court It is lies at the heart of this ground of appeal. that the erred in law in holding of losses losses: "9.1. The lower court in awarding the Appellants 30 months' by only submitting salwy stated that the application for called for the had failed lo mitigate lo apply.for the loll'er Appellants their losses re-engagement with the Respondents Appellants law. Further, ii that the Appellants witness. It ll'Ould employment was the Respondent. important according hare been difficult for the Appellants re-engagement. fi1cts court misapplied/ignored to the Respondent's trained were purpose to .find alternative the Appellants when the Respondent We submit that this was a misdirection when the only institution that would ha1·e employed in before presented " Limited that the burden of proof of non-mitigation Newspapers It is commonplace v. Charles see Blantyre Case No. 6 of 200 (unrepresented) and the Canadian Hersy Professional Service Deer College [1976] BC No. (SC) and Edge v. Kilborn 992 (SC). 1198] BC No. 2057(SC), Rail Products (BC) Limited 2 SC R 324, Fast v. Western Engineering Simango, Limited v. Red Michaels Limited [2000] [1987] BC No. UC/PR Civil Appeal cases of Bird v. Warnok is on the employer: In Blantyre he then was, said: Newspapers Limited v. Charles Simango, supra, Mwaungulu J, as howel'er to obtain other reasonably "I was not much impressed, plaintiff Defendant steps to mitigate, see employment: to prove not only [c1il11re with the effort -I should say lack of effort comparable employment. in fact, but that had the -by the But the onus is on the plaintiff taken reasonable he would have been likely to obtain comparable alternative Munana -vs-Mac:vfillan by underlining supplied Bloedel Limited [1997] 2AC WS 30./ (BCSC)." -Emphasis It is also the law that the defendant were available. This point was put in Edge v. Kilborn Engineering as follows: Limited, job opportunities (BC) must prove that alternative supra, Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. newspapers "Turning various been obtained these were ol/lside outside that rather the employer of British who placed Columbia than just produce now to the question of other potential purpose were put into evidence.for job opportunities. of indicating Copies of ads from jobs that could have by the plaintiff said many of had he only tried. By way of reply the plaintiff his field of expertise or were unsuitable or were at a lower level of employment, reasons. for various it seems to me Again, were newspaper ads, if it relies them so he can be cross-examined. A newspaper on these ads, it should produce cannot be The defendant cross-examined. term its nature and the rate o(pay. Only then can a Judge decide unreasonable supplied f to turn the offer down." -Emphasis must prove that the iob was available. for the plaintif whether the length or not it was of its by underlining clear from the foregoing It is plainly prove non-mitigation College, where Laskin CJ said: supra, authorities that the onus on an employer to is by no means a small one: see Michaels v. Red Deer "But the burden which lies on the defendant of duty of mitigating breach of contract is by no means a light one for this demands positive pro,•ing action that the plaintiff is a case where a party already has.failed in his in from one who is often innocent of blame." pause to observe Trust v. Kalowckamo I momentarily Endowment authority production discussed for the proposition of employment application the issue in three sentences (2008] MLLR 237 (HC) is often cited as should demonstrate that an employee through letters as follows and negative at page 242: responses. The Court that the case of Malawi Environmental mitigated had success.fully "This leads to ground 2 of the appeal which is that the court erred in ruling respondent the basis of which the court could employment application alternative The court would there.fore his loss and therefore his loss. On this aspect have found that the the loss from the non-renewal ground 2 of the appeal succeeds. agree with lhe appellant that the respondent in order to mitigate employment and negative responses thereto letters there was no evidence respondent had through on of his contract. did not mitigate tried in vain to seek that the " We due respect, Endowment consideration Trust v. Kalowckamo of relevant the decision authorities. on mitigation of losses was reached in Malawi Environmental there was no per incuriam: case, it seems both the lower coutt and the Respondent proceeded that the Appellants bore the onus of proving on mitigation. In the present the erroneous assumption For the lower court, it will be recalled have not shown that they mitigated that it found that "most of the applicants the loss occasioned by the dismissal ... there is Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, whatsoever that the applicants mitigated the losses that they suffered no evidence asa result submissions by the Respondent: of the termination of employment". This was very much in line with the "9. 1 The appellant's failure to mitigate loss is clearly to be seen from the witness .filed with the court in relation statements !RC ll'as therefore correct their loss. in none of the witness evidence statements to mitigate their loss. lo the assessment that the appellants The to mitigate any proffer did any of the appellants of compensation. had failed in holding of al/empt " of loss in a very simplistic jobs were It seems to me that both the lower court and the Respondent of mitigation evidence and the rate of pay of these alternative jobs. Court would not be in a position the Appellants to prove that alternative not to apply for such jobs. to decide whether In the absence available way. The Respondent let alone the nature, approached did not call any the issue duration the for or not it was unreasonable of such evidence, In the premises, erred in law in holding losses. non-mitigation of losses therefore, succeeds. Actually, the Cou1t would agree with the Appellants had failed to mitigate that the lower court their respective that the Appellants that failed it is the Respondent on the pa1t of the Appellants. to satisfy the burden of proving This ground of appeal, that in arriving among other matters, at the award of 30 months' failure salary, by Appellants the lower court their to mitigate It will be recalled took into account, losses. been reduced months' salary applications, lost remuneration for 42 months". not state a specific The lower court did on account in that "For the one applicant we order that he should be treated by which the award had percentage but it seems it was reduced by 12 who has shown that he had made job the and be awarded of lack of mitigation differently In the circumstances, a beefing salary ordered. by an additional up of the award by the lower court of 30 months' 12 months' salary would be just and equitable. It is so GROUND OF APPEAL NO. 8 It is the case of the Appellants erred in law in failing under this apply the law to the facts when dismissing ground of appeal that the lower court to properly the Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. Appellants' following terms: various claims. The arguments by the Appellant were put in the "10.2. The Appellants pleaded for compensation for various loss of earnings, immediate benefits, This included pay, redundancy payment All these were dismissed court. notice and interest. conditions decisions. Appellants years from the date of termination assessment. the ruling of sen•ice and For example, lost pension. on assessment constituted The period Furthermore, the binding High as a result immediate lost pension, of the underpaid by the lower court without Court and Supreme claims before future severance the the lower earnings, benefits applying Court of Appeal of employment, of the termination it had taken more than three and a half the to the date of the ruling of employment on to the date of The date after loss of earnings. from the date of termination of employment represented on assessment applied Furthermore, the r11ling been properly decision. loss o_(pension before future loss of to the la.v by the lower court in coming up with its 1he lower court made l lad the lower court properly the Appellant applied 's various the law to the facts claims. no determination it, it would not have dismissed earnings. benefits. on the claim for This should have 10.3. The loll'er court should have just as in the Clwwani case , awarded the pension and gratuity " day of August 2010 Appellants received their letters have been lawfully increments salary day of July, 2010 to the period from the -11 their employment terminating The calculations retired. at the rate of 20 percent for the salary covering when they up to the period they would annual 28'" the period dates. should take into account of the Appellant 's respective retirement I 0.3. The lower court should also ha,•e considered that fact that the Appellants had invested Respondent in collecting all their energy and time in MRA. They speciali=ed it is next to is the only institution that collects tax in Malawi. tax. The that the Appellants tlte Applicants would have ever get employed. To quote, DWI were purpose trained. There is no any other which collects impossibility during trial, institution secure employment. and experienced labour practices amount, and equiwble marketabilily qualifications miligated proximily Mbewe v Reserve Applying 2012, the Applicants dismissal, 201./ ... taxes in Malawi. It would be very difficult for them lo were very qualified It is however in the field of revenue has been gravely clear that the Appellants collection. As it ll'ere, curtailed. the Court will look al several on the job market, age of the applican/ his loss. Afore i111porta11tly, to the dismissal A bore all their right to fair to award a just such as the the has the cow·/ looks at the loss role in causing of !he applicant of !he applicant, and ifs itself (Ruth !he dismissal and the applicant's !he job market itself, and whether in flying factors !he applicanl Bank of Malawi Matter Numher !RC PR381 of 2012). Rutlt Mbewe v Reserve Bank o{Malawi Matter Number !RC PR381 of that is from 28'" July, 201./ to the date o_(judgemenl, fi·om the date of /he claimed that is, January should be awarded lost salary Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. The Respondent Court's on the took the view that this ground of appeal is dependent determination of the issues raised in the other grounds of appeal. it is clear that matters Having considered thereon, or supplement repeat In view of the conclusion consideration of arguments anyway necessary. this ground of appeal and the submissions by both Counsel canvassed in arguing this ground of appeal submissions made in respect of the other grounds merely of appeal. that I have reached by Counsel on this on those grounds, I do not see the ground of appeal as being in GROUND OF APPEAL NO. 9 contend The Appellants award of salary increments for purpose compensation of computing awarded that the lower court erred in law in failing as pleaded considering to make an that the salary which was used in 2010 and as such the compensation was one payable was not just and equitable. Counsel attention on compensation. Mumba began his arguments to the reasons The lower court stated that: given by the lower court for refusing to award increments on this ground by drawing the Court's "If it is the case that the applicants that claim cannot stand because looks at the sala1J' that an employee when making an order for compensation the court at the time he was dismissed". was getting and [sic} making a claim based on this promise, that the fair and equitable earnings Mumba submitted for loss of immediate Counsel Appellants paragraph mandatory Case in which the Supreme Court annum. 6.4 of IRC Form I (from the time of the dismissal retirement age) is by adopting in the General what prevailed salary of Appeal awarded increments Simwaka of 20% per the in to the time of and future losses as pleaded way of compensating Mumba further contended Counsel a half years had passed from the date of termination the OAC, payment of compensation termination He, accordingly, factor in increments and Chawani Case that in view of the fact that more than three and to the date of using only the sala1y at the time of the just and equitable of 20% per annum as was held in General prayed that the compensation of employment of employment would render Simwaka Case payable principle illusory. to the Appellant should Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, Here again, the position dependent appeal. on the Court's of the Respondent is that this ground of appeal is in the other grounds of the issues raised of determination This ground of appeal must fail. Firstly, the Act that the measure of a week's or month's pay has to be with reference of s. 63(5) of to the it is clear from the language employee's (Malawi) made the following remuneration at the termination Ltd v. Ndcma [2008] MLLR 14 where the Supreme of the employment: DAF see Leyland Court of Appeal instructive dicta at pages 20 and 21: "it is also observed, severance Wages (Hotel and Catering Employment termination (Severance of his services ... pay under the subsidiary legislation to above, namely, and there is no dispute that the calculation on this point, we have referred Jnduslly) Order and the Wages and Conditions Pay) Order was based on the employee's wages at the lime of of the of . . . . Calculation termination of services makes a lot of sense and is realistic ." of severance pay on the basis of wages or sala,y al the lime of in arriving and other benefits compensation, from termination of immediate loss at what is just and equitable Secondly, moved away from the concept (that is, loss of salary benefits and future Joss (that is, loss of salary or such other date as cases determined Malawian such as Norton Tool Co Ltd v. Tcwson (19731 1 All ER 183, F. N. Kalinda v. Limbe Leaf Tobacco Ltd Civil Cause No. Case. from date of judgment as propounded to retirement and earlier to date of judgment) by the court) in English the courts and other have 1542 of 1995 and the Kachinjika For the foregoing reasons, making an order for compensation was getting at the time he was dismissed". I uphold the decision of the lower court that "when the court looks at the salary that an employee GROUND OF APPEAL N0.10 The Appellants in order to make the award just and equitable. fault the lower court for failing to award interest on compensation "We also pray thal based on lhe case of Jane Malanga Vs Old Mutual Malawi Limited Appeal Case f\!o. 0./ of 2012, per Afwaungulu, money payable compensation on all 1he J, inlerest should be awarded severance allowance, notice pay and " lo the Applicants of earnings for immediate loss loss of earnings. including and future Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. Based on the above-mentioned statement, clear that the lower court never considered thereby surprise raised making the award not just and equitable. as to why the lower court failed to consider on assessment in the Appellants' submissions Counsel the issue when the same was Mumba expressed at page 13: of compensation Counsel the issue of loss of value of the salary Mumba contended that it is panelists, it should be observed when they were unfairly of inflation "Your Honour and members which the Applicants ravages be said to be the same. There ll'ere Employees institution. dismissed unfairly were earning and devaluation are now earning <�( the Malawi currency. the value cannot a number of increments effected who were earning MK150, 000.00 at the time the Applicants at the Respondent were dismissed No doubt, by the was affected of MK600, 000.00. The fair and equitable way of that the value of the salary the Applicants to 1he lime o_fjudgment) compensating the dismissal v The Attorney General the Malawi Supreme Court of Appeal awarded supplied Emphasis by underlining for loss of immediate earnings (from the time of as pleaded whal prevailed Simwaka in which MSCA Civil Appeal Number 6 of 2001 (Unreported) is by adopting in General sala,y increments of 20% per annum. " - that interest on all withheld at the benefits in t�rms the Respondent against bank lending rate should be ordered Mumba ended with a prayer Counsel commercial of inter alia Rick Chindole District Registry Nedbank, Limited (Unreported) Appeal Case No. 04 of 2012 (unreported). MSCA Civil Appeal v. Nyson Jeremiah Namwili, Malamulo Civil Appeal No. 17 of 2012 (unreported), v. Reserve Bank of Malawi, TIC/ Philip Madinga v. Lilongwe and Jane Matanga v. Old Mutual Malawi Limited, No. 15 of 2009 (Unreported), HC/PR Civil Appeal No. Total Malawi 203 of 2011 HC/PR bank lending Malamulo an order to the appellant at the prevailing In Rick Chindolc granted interest an award of interest had not been specifically Malawi Limited Mutual Malawi Limited, allowance which was paid late. supra, v. Nyson Jeremiah v. Reserve Bank of Malawi, supra, correcting the judgment of supra, rate. In Philip Madinga v. Nedbank, to include the High Court the payment was made on the terminal benefits even though such interest was awarded in Total pleaded. Interest in labour matters Namwili, In Jane Matanga v. Old supra. J, awarded interest on severance Mwaungulu, The case of Kankhwangwa and Other v. Liquidator, Import and Export Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. MLLR 26 (SCA) [Hereinafter to as the "Kankhwangwa Case"] is that the strict referred rules of pleadings do not apply in the Industrial seeks what the plaintiff appreciates Court . It is enough if the defendant [2008] for the proposition Relations from the Industrial Relations Court. of IRC Form I reveals that the Appellants Case, where the claim at least made a mention case, a perusal their respective In the present in detail particularized Kankhwangwa column for particulars interest herein mention Appellants court to award them interest of relief on the said severance the Respondent to interest. expected or relate sought (Claim prayers for reliefs into 27 items. Unlike in of interest in the for (a) severance (b) none of the 27 items in the IRC Form 1 how the fail to understand allowance allowances), As such, I to appreciate on the compensation. that they were seeking the lower In any case, it is trite Kankhwangwa that interest on compensation is not awardable on the subject anyhow. The and matter authority Case appears to be the leading I make no apology 32C to page 33F): for quoting at lengthy a relevant passage therefrom (from page "Interest term of a contract. is awardable It is also payable of law when ii is pursuant as a mailer as a mailer of law where there is a statutory to an express or implied requirement equitable court's The situations described {1975 J 1 All for the payment of interest. See Gwembere jurisdiction. in which a court in equity Interest is also awardable v Malawi Railways in the exercise of the 9 MLR 369. Limited of interest are lucidly v Moir MR, as he then was, in the case of Wallersteiner may order the payment by lord Denning ER 855 in which his Lordship stated: "Those judgments punishment. trustee made use of it himse(( or anyone else in show that, in equity, is never awarded by way of interest money is misused Equity awards ii whenever by an executor or a a fiducia,y for his own benefit. position The Court presumes: -who has misapplied the money and 'That the party against profit which persons Court directs whom relief ordinarily be made {i.e. rests to do make in trade, compound is sought has made that amount of the . . . interest} and in those cases The reason is because out of his trust; profit in lieu thereof interest a person in a fiduciwy and, if he does, he is liable to make a for that profit or position is not allowed to account Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, in equity In addition, company of money which it needs lo use in its business. to ii." Company should is awarded whenever be compensated interest for the loss thereby occasioned a wrongdoer It is plain that the deprives a falls outside Flue-Cured is not closed. in the Wallersteiner as he then was, added agents against positions such /isl. and Zgambo cases, Where, for instance, between In the case of Zgambo v Kasungu Mwaungulu, Registrar, in fiduciary of persons the respondent still slated interest, essentially commercial court may have jurisdiction money, which is la11fully that the person withholding other person become necesswy. against to the other. the money has profited or the transaction to award interest IVe do not think that that situation due and payable from earning Tobacco Authority and Company Directors 12 MLR 311 to the list may be made. Again whom awards of interest We would observe that the list of situations in which it would be proper lo award between the relationship involves the parties some trading, a party who wrongfit!ly withholds the parties is a from using it or has prevented a return on such money, then the need to award interest exists in the present case. " presumed the may (( it can be properly It is plain to see that the situations Kankhwangwa obtain relation case. The Respondent The Respondent by Supreme Court of Appeal in do not an award of interest did not stand in a fiduciary in position of the or executor was not a trustee Case, which would attract to the Appellants. in the present mentioned in equity I I Appellants. Respondent. Again there is no issue of misuse or misapplication of funds by the proposition at a normal rate, he should also put before the court evidence of Jaw is that unless a claimant is seeking no more cou,t can decide what amount (if any) to allow: the settled Further, than simple interest on which the Import & Export Malawi Ltd v. Kankhwanga the present award of interest Counsel awarded. case, no such evidence on all withheld Mumba simply cited cases in which interest Such cases do not constitute has been offered benefits evidence. & Others (2008) by the Appellants to justify the rate. bank lending rate had been at the claimed at the commercial See Liquidator, MLLR, 219. In I The long and short of it is that the lower court did not err in not awarding on compensation. There is no basis for awarding interest. interest I I I I I I I Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta Nyirenda, J. This, however, also complain, the Appellants, devaluation Kachinjika 433 [Hereinafter noted that inflation factors critical is not the end of the matter. It that in determining the extent the lower court erred in law by not factoring award payable in the effects The issue of cost of money cannot be ignored: of the compensatory to of See will be observed that the Appellants and inflation. Case and Kandoje v. Malawi Housing referred to as the "Kandoje Case"]. and devaluation since the termination Corporation In these cases, (2008) MLLR the Courts of employment are for the Court to bear in mind. In the premises, Kandoje Case: the lower court should have boosted the award as was the case in "The cause of aclion arose in 2003 bu/ lhe e,·enls applicanl from lhe payslip. devalued inflation since 1998" was lowly paid as no/iced and /he court has discretion ... in I his case the courl a\\'ard1· to award interesl -10%0/ the lo/c,/ cover a period from 1998. The The local currency lo cater for devalualion has since and award lo cater for devaluation have to be shown to warrant It is agreed that not every case requires reasons Thus, whilst 40% was deemed compensation General appropriate by 100% in Frackson Chitheka Civil Appeal No. 67 of 2008 (unreported). in Kandoje Case, an award of v. The Attorney In that the award be boosted: such an award and the percentage compelling thereof. of Finance), was boosted (Ministry \the latter grounds, all of which case, the appellant challenged an award of compensation on seven to erring related by 100%. Mzikamanda J, as he then was, reasoned as follows: by the cou,t in its calculation of compensation and in boosting it for unfair of the court built dismissal in .... ln assessing a number of factors. These include by governed for unfair the applicant's is a mailer compensalion age, physical fitness, qualijicalion and the the courl in determining the multiplier, acco1111/ his loss, employee's /he court takes into "As will be seen the issue of compensalion the law with the discretion dismissal efforl to mitigate prevailing and the formula Relations pleaded discretion time. J confirm /hat 100% of the lower courl considering hoosr. Court ii is the general ... As regards for calculaling " -Emphasis These .factors labour market. and proved in.form is sel by the law In mailers Iha/ 11'ill formula apply unless the boost by I 00% pension the devaluation thal come lo !he Jnduslrial .formula some special is Iha/ was entirely in the at the and the rale of living by underlining supplied ' Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, case, it took more than three and a half years from the date of to the date of the ruling since 2012 and, as a result, In the present termination of employment also aware that there has been a slide in the national especially rate regime with devaluation living/inflation. would boost the compensatory devaluation termination of the Malawi currency of employment and in the exercise in 2010. I so order. In the premises at a very high percentage and (b) a rise in cost of I discretion, award under s. 63 of the Act by 25% to reflect the since the and the rate of living/inflation of the Court's there has been (a) a major shift in exchange on assessment. The Court is economy over the years Conclusion and Disposition To sum up, the result of my judgment is that: (a) Grounds of Appeal No.s 1, 4, 5, and 9 are dismissed; (b) with the exception of the claim for notice pay, Ground of Appeal No. 2 succeeds; (c) Ground of Appeal No. 3 succeeds for calculating and as a result wrong formula redundancy benefits in that the Respondent allowance, used the pay and notice severance the Appellants were underpaid: "wages" or "salary" severance notice allowance, pay and redundancy were benefits used by the Respondent in calculating the restricted medical aid and leave grants; to the basic pay; they did not include two items, namely, ( d) Ground of Appeal No. 6 was not pursued; and (e) as the Respondent had failed to prove that there was non-mitigation of on the part of the Appellants, the award by the lower court of salary would be beefed up by an additional 12 months' losses 30 months' and salary; Charles Mwasi & Others v. Malawi Revenue Authority Kenyatta J. Nyirenda, (f) on Ground of Appeal No. 10, there is no basis for awarding by 25% to take into award is to be boosted interest but the compensatory account ravages of inf1ation and devaluation of the currency. For the sake of clarity, be stated 8 were dealt with under the other grounds that matters of appeal. it should under Ground of Appeal No. to determine the amount that is due to the under paragraphs (b), (c), (e) and (f) above, I order that the Appellants details As I do not have sufficient Appellants calculate and the Respondent should paragraphs Court has to appoint amount of money payable 14 days of this order. a date within within to the Appellants. and agree on the sums due under the said of the High the of assessing Should they fail, the Registrar 28 days hereof for purposes 30 of the Courts Act, as read with 0.62, r.3 of the Rules of Supreme costs to follow the event, Section requires other order should be made as to the whole or any part of the costs. case, the Appellants consider so order. have substantially costs herein: in the appeal. the same to be agreed it just that they be awarded when it appears succeeded except to the Court that some I, therefore, I or taxed. In the present Court, Pronounced in Malawi. Court this 1 gth day of May 2017 at Blantyre in the Republic of 6�� Nyirenda Kenyatta JUDGE 64