FILOMENA NG'WANE (in her capacity as the Administrator of the estate of the late Alex Ng'wane) V ZAMBIA BREWERIES PLC (APPEAL NUMBER 61/2019) [2019] ZMCA 320 (12 November 2019)

ii IN THE COURT OF APPEAL OF ZAMBIA (cid:9) APPEAL NUMBER 61/2019 HOLDEN AT NDOLA (Civil Jurisdiction) BETWEEN: (cid:9) - Pu COURT 1 2410 /VjL FILOMENA NG'WANE (in her cap of the estate of the late Alex Ng'wane) a Ir or APPELLANT AND ZAMBIA BREWERIES PLC (cid:9) RESPONDENT CORAM: CHISANGA J. P, MAJULA, NGULUBE JJA On: 22nd August, 16th October and 12th November, 2019 For the Appellant: R. Mainza, Messrs Mainza & Company For the Respondent: M. Moonga, Messrs Tembo, Ngulube & Associates JUDGMENT NGULUBE, JA, delivered the Judgment of the Court Cases referred to: - 1. Duly Motors(z) Limited v Patrick Katongo and another (1986) ZR. 61 2. Zambia Revenue Authority v Hitech Trading Limited SCZ Judgment No 13 of 2001 3. Zambia Consolidated Copper Mines v Jackson Munyika Siame and 33 others (2004) ZR. 193 Legislation referred to: 1. Employment (Amendment) Act No 15 of 1997 2. Employment (Amendment) Act No 15 of 1989 1. Introduction J2 1. 1. This is an appeal against the Ruling on assessment of damages by the Registrar of the Industrial Division of the High Court delivered on 23rd November, 2018. In the said Ruling the following awards were made: Christmas bonus at K83,232 .64(unrebased), housing allowance at K646,767.39 (unrebased), redundancy benefits with interest at K18,174.33 (rebased), and 303 crates of beer. The Registrar refused to award the claim for two motor vehicles on the ground that it had been withdrawn. 2. The background to the dispute in this Appeal 2.1 Before we consider the appeal in detail, we wish to state that during the proceedings in the court below, the complainant, Mr. Alex Ng'wane passed on and the matter was prosecuted by his wife, Mrs. Filomena Ng'wane in her capacity as the administrator of his estate after having been granted an order for leave to substitute party to the proceedings. However, for reasons unknown, the substitution was not made. Accordingly, we substitute Mrs. Philomena Ng'wane, the administrator of the estate of the late Alex Ng'wane as the appellant. J3 2.2 The brief background of this appeal is that the late Mr. Alex Ng'wane worked as an electrical engineer for the respondent until 8th June, 1992, when he was dismissed from employment. Following his dismissal, he filed a re-amended notice of complaint before the Industrial Relations Court in 1993. He moved the court below seeking the following reliefs- (i) A declaration that the suspension imposed on him by the respondent on 7th January, 1991 was discriminatory or wrongful or unfair; (ii) A declaration that the demotion imposed on him by the respondent on 3rd September, 1991 was discriminatory or wrongful or unfair and therefore null and void; (iii) A declaration that the dismissal imposed on him by the respondent on 8th June, 1992 was wrongful or unfair and therefore null and void; (iv) An order that he be reinstated as an electrical engineer in the respondent company and that he be paid all allowances and benefits due to him from the date of purported demotion and dismissal with interest; J4 (v) An order that the respondent pays him damages for discriminatory or wrongful or unfair suspension; (vi) An order that the respondent pays him compensation and damages for wrongful or unfair demotion and dismissal respectively; and (vii) An order that the respondent pays costs. 2.3 In 2004, the court rendered its judgment to the effect that the late Alex Ng'wane had been wrongfully and unfairly dismissed from employment and ordered- a) that the demotion he suffered was null and void and that he be paid all the monies he was not paid during the demotion; b)that he be declared redundant in accordance with the conditions of service applicable to ZIMCO employees serving as electrical engineers, scale Z7 with effect from the date of the purported dismissal; c) that he be paid twelve months salary running from the date of dismissal as compensation for the trauma he suffered; d) that he be paid interest at the Bank of Zambia lending rate from the date he filed the complaint to the date of the payment considering the inflationary rate of the Zambian Kwacha; and J5 e) that costs be borne by the respondent. 2.4. The matter was then referred to the Registrar for assessment. 3.0. The appellant's claim and the respondent's defence before the Learned Registrar 3.1 The late Alex Ng'wane's claim anchored on the judgment of the Industrial Relations Court as well as the computation appearing at pages 3 to 6 of the notice to produce documents filed into court. He claimed for the payment of K84,359.8 (unrebased), as the total value for salaries not paid, housing allowance, Christmas bonus and non-taxable allowances, the value of 546 crates of beer and two motor vehicles. To support his claim, he relied on the ZIMCO conditions of service which were applicable to him at the time. 3.2 In disputing the claim, the respondent contended that the appellant was not entitled to any monetary compensation because he did not suffer any salary reduction during the period of his demotion. Further, that the applicable ZIMCO conditions of service for the appellant at scale Z/7 was six months basic pay for each year of service. It was the respondent's further contention that at the time of dismissal from employment, the J6 late Alex Ng'wane had worked for the respondent for a period of 9 years and that his last drawn basic pay was K10,404.08 (unrebased). It was argued that the total amount due to the appellant was K124,848.00, (unrebased) which was 12 months' pay based on his last drawn basic pay. 3.3 It was the respondent's contention that the award under paragraph 5(d) of the respondent's affidavit in opposition to summons for assessment for damages included interest at Bank of Zambia lending rates based on the total sum of the awards from paragraph 5(a) to 5(c) of the said affidavit, which amounted to K728,280.00. (unrebased). It was the respondent's further contention that the computation attached to the appellant's affidavit in support of assessment of damages was clearly exaggerated and completely out of what the Judgment provided for. The respondent argued that it had significantly paid into court the total amount of damages due to the appellant and that as such, the appellant was not entitled to continue to claim for the late Alex Ng'wane's wages as alleged. 4. Consideration of the matter by the Learned Registrar and the decision. J7 4.1 After the learned Registrar considered the evidence, and arguments presented by both parties, he observed that the ZIMCO conditions of service were applicable to the late Alex Ng'wane, and that the interest rate applicable was the average Bank of Zambia lending rate from April 1993 to 9th January, 2007 when the respondent paid money into court. 4.2 In his reasoning, the learned Registrar declined to award the appellant the claim for two vehicles, water and electricity as well as entertainment allowances as the appellant admitted in examination in chief that her late husband was not entitled to the said claims. 4.3The learned Registrar summarised the awards as follows: a) Redundancy benefits = (cid:9) K 2 2 621, 828.96 b) Six months pay in lieu of notice= K 62, 424.48 c) One month's salary in lieu of notice = K 10, 404.08 d) 12 months' pay for trauma= K 124, 848.96 e) Christmas bonus= K 83,232,64 fj Housing allowance= K 626,967.39 g) Refund of rentals= K 16, 800.00 Total principal (cid:9) K 3, 549,585.71 (unrebased) 4.4. The learned Registrar further held that the interest on the J8 principal of K 3,549,505.71(unrebased) from 19th April 1993 when the Writ was filed to 9th January 2007 when money was paid into Court was K26,039,760.77 (unrebased) less K7,865,432.00 (unrebased) paid into court which equals to 18, 174,328.77 (unrebased), making it K18, 174.33 (rebased). The Leaned Registrar further ordered the respondent to give the appellant 303 crates of beer in accordance with the appellant's ZIMCO Conditions of Service. 5.0. Grounds of appeal to this Court 5.1. Being dissatisfied with the ruling of the Registrar, the appellant appealed to this Court advancing three grounds of appeal as follows- (1)The learned Registrar misdirected himself in law and in fact when he awarded the appellant salary arrears for the period 8th June, 1992 to 13th July, 2013 at a monthly salary of K10,404.08 (unrebased). (2)The learned Registrar misdirected himself in law and in fact when he failed to award the appellant two motor vehicles on grounds that the claim for two motor vehicles had been J9 withdrawn by the appellant and further that it was not supported by evidence. (3)The learned Registrar misdirected himself in law and in fact when he failed to take into account inflation during the period 8th June, 1992 to date of the Ruling on assessment when computing interest and awarding the appellant damages as directed by the trial court in its judgment. 6. The arguments presented by the parties 6.1. The parties filed heads of argument which they relied upon at the hearing of the appeal. We have considered the arguments along with the judgment and Ruling of the Registrar. 6.2. In arguing ground one, the appellant contends that in terms of section 26B (3) (a) and (b) of the Employment (Amendment) Act', the respondent was legally obliged to pay the appellant redundancy benefits not later than the last day of duty of the late Alex Ng'wane, namely, 8th June, 1992 or where unable to do so continue to pay him full wages until the redundancy benefits would be paid 6.3. It was the appellant's contention that in computing the terminal benefits due to him which he pegged at K 7, 865, 432.00 J10 (unrebased), the respondent omitted to include the computation of one month pay in lieu of notice, Christmas bonus, housing allowance, salary arrears for the period 8th June, 1992 to 13th July, 2013, entertainment allowance and car allowance, which constitute contractual terminal benefits provided for in the ZIMCO Conditions of Service for non-represented employees of 1989 to 1998. The appellant conceded to the fact that the respondent paid into court part of the claims, on 8th January, 2007, fifteen years after the late Alex Ng'wane ceased to be an employee of the respondent. 6.4. It was the appellant's further contention that in 2007 when the respondent purported to pay the terminal benefits due to the late Alex Ng'wane, it paid a portion of the terminal benefits leaving out the benefits mentioned in paragraph 6.3 above which have remained outstanding to date. 6.5. It was argued that the respondent having failed to pay the late Alex Ng'wane his terminal benefits in full when the same fell due on 8th June, 1992, as provided for by the law, the appellant was entitled to salaries at the rates applicable to employees in the service of the respondent during the period 8th June, 1992 to 13th July, 2013 ill when he died. According to the appellant, the learned Registrar misdirected himself in law and in fact when he declined to take into consideration the increased salary scales for the period 8th June, 1992 to 13th July, 2013 when computing the salary arrears due to the estate of the late for the same period on grounds that the increased salary scales in question were not the basic pay the late Alex Ng'wane was getting. 6.6. The appellant felt that the correct interpretation of the proviso to section 26B of the Employment Act' is that where the employer fails to pay the employee his redundancy benefits on the last day of duty of such employee, the employee's name shall remain on the pay roll of such employer and that any adjustments made to salaries of employees of such an employer shall equally apply to the employee who has been declared redundant until he or she is paid redundancy benefits. It was contended that the employee whose services have been terminated by means of redundancy would unjustly be disadvantaged where the law on payment of their packages is to operate in the manner interpreted by the learned registrar. 6.7. In relation to ground two, the appellant contended that while she J12 concedes that she did, in her evidence-in-chief, appearing at page 282 lines 19 to 20 of the record of appeal inform the learned Registrar that she had abandoned the claim for two vehicles, she did in fact rescind her decision to abandon the claim under cross- examination. Further, that having testified under cross examination that she wished to reinstate her claim for two vehicles, the learned Registrar ought to have taken her testimony into account when deciding whether or not the two motor vehicles formed part of the late Alex Ng'wane's redundancy benefit. In support of the claim for two motor vehicles the appellant relied on the provisions of clause 1.1 and 1.7. 1 of the respondent's conditions of employment for non-unionised employees, 1998 appearing on pages 85 and 86 of the record of appeal. 6.8. In relation to ground three, it was argued that the ruling of the Registrar did not take into account inflation when awarding interest as directed by the trial Court. In support of this argument, the appellant cited the case of Duly Motors(z) Limited v Patrick Katongo and another' in which it was held that: J13 "Where there has been inflation, as there has been in this country, a plaintiff who has been deprived of something must be awarded realistic damages which will afford him a fair recompense for his loss calculated at the value appropriate to the date of the award." 6.9. It was contended that given the inflation rate of the Zambian Kwacha from 1992 when the late Alex Ng'wane was declared redundant, the learned Registrar ought to have awarded the appellant a realistic interest rate which would have afforded the appellant a fair recompense for non-payment of her late husband's redundancy benefits for the past twenty-one years. In summation, the appellant urged this Court to set aside the ruling of the learned Registrar in the interests of justice. 6.10. Counsel for the respondent filed heads of argument in response on 3rd October, 2019, on which he placed reliance. In the arguments, Counsel stated that the learned Registrar did not misdirect himself in law and in fact when he awarded the appellant salary arrears for the period 8th June, 1992 to 13th July, 2013 at a monthly salary of K10,404.08 (unrebased). Counsel conceded J14 that the late Alex Ng'wane was effectively declared redundant on 8th June, 1992 and that his last monthly salary was K 10,404.08 (unrebased). It was his contention that according to the Registrar, the salary of K 10,404.08 (unrebased) would then be multiplied by 252 months, being the number of months from the date of being declared redundant until his demise on 13th July, 2013. 6.11. It was Counsel's view that in the heads of argument, the appellant erroneously relied on section 26B (3) (a) and (b) of the Employment (Amendment) Act No. 15 of 1997 as the said law was not in force at the time the late Alex Ng'wane was declared redundant on 8th June, 1992. Counsel submitted that the prevailing law at the time he was declared redundant was the Employment (Amendment) Act No 15 of 1989. In particular, section 15C of the said Act provided as follows- 11(1) Subject to any agreement between the parties providing for conditions which are not less favourable to an employee than are provided for in this section, where, by reason of redundancy a contract of service is terminated by the employer or by another person acting for and on behalf of the employer, the employer J15 or the person acting on his behalf shall be liable to pay to the employee a redundancy payment calculated in a manner prescribed by the Minister. Provided that a redundancy payment shall be made only to an employee who has been employed by the employer continuously for a period not less than six months. (2) For the purposes of this section, an employee's contract of service shall be deemed to be declared terminated by reason of redundancy if the termination is wholly or partly due to (a) The fact that this employer has ceased or intends to cease to carry on the business for the purposes of which the employee was employed by him or has ceased or intends to cease to carry on that business in the place where the employee was so employed (b) The fact that the requirement of that business for employees to carry out work of a particular kind J17 respondent to maintain the late Alex Ng'wane on its pay roll until payment of the redundancy package. It was Counsel's argument that based on the legislation in force then, the late was not even entitled to salary arrears. Further, it was contended that the provisions of the Employment (Amendment) Act No 15 of 1997 cannot be applied in retrospect. Given the foregoing, Counsel concluded that based on the holding of the Registrar, the evidence on record and the law cited above, section 26B of the Employment (Amendment) Act No. 15 of 1997 should not be applied in computing the late Alex Ng'wane's redundancy package. 6.13. Turning to ground two of the appeal, it was contended that the learned Registrar did not misdirect himself both in law and in fact when he refused or failed to award the appellant two motor vehicles on the ground that the claim for the same had been withdrawn and further that the claim was not supported by the evidence. 6.14. Counsel submitted that the appellant's reliance on appendix 2, clause 1.1 and 1.7.1 found at pages 85 and 86 of the record of appeal is misplaced and misconceived for the reason that appendix 2 falls under the respondent's conditions of employment JiB for non-unionized employees which took effect on 1st July, 1998 years after the late Alex Ng'wane had been declared redundant. Further, that the appellant failed to provide tangible proof that the late Alex Ng'wane was entitled to the two motor vehicles as claimed. Counsel urged us to dismiss this ground of appeal. 6.15. With respect to ground three of the appeal, it was submitted that in accordance with the Judgment of the trial court, the learned Registrar awarded interest to the appellant at the rate of 43.20 per cent which took into account the inflationary rate of the Zambian Kwacha. Counsel submitted that the appellant has not put before court the factors or elements to be taken into account when considering the inflationary rate of the Zambia Kwacha by way of statutory provisions or case law. In addition, it was submitted that since the respondent paid into court a substantive amount of money in the sum of K7 865.432.00(unrebased), the interest award was arrested by the said payment. To support this view, the Court was referred to the case of Zambia Revenue Authority v Hitech Trading Limited2 in which the Supreme Court observed that money paid into Court does not attract interest. In conclusion the respondent urged us to dismiss the appeal as it lacks merit. 6.16. At the hearing of this matter, both Counsel relied on their heads Jig of arguments. 7. Decision of this Court. 7.1 We have considered the record of appeal, and the submissions by counsel for both parties. 7.2 The issue under contention in ground one as we see it, is which legislation is applicable to the appellant's claim for redundancy? We agree with Counsel for the respondent that the learned Registrar did not misdirect himself by not applying the provisions of section 26B of the Employment (Amendment) Act No. 15 of 1997 retrospectively to a redundancy that occurred in 1992. In her argument in the main the appellant heavily relies on the provision of section 26B of the Employment (Amendment) Act No. 15 of 1997 to support her claims. On the other hand, the respondent has spiritedly argued that the correct provision applicable to the late Alex Ng'wane's redundancy is Section 15C of the Employment (Amendment) Act No. 15 of 1989 and that this law did not oblige the respondent to maintain him on its pay roll until payment of the redundancy package or indeed meet any other requirement, save to make the requisite payment. J20 7.3 Upon perusal of the record of appeal, we are of the view that the learned Registrar of the court below did not misdirect himself in law and in fact. We also note that in 1992 when the late was declared redundant, the Employment (Amendment) Act No. 15 of 1989 did not oblige the employer to maintain him on its pay roll until payment of the redundancy package, give notice or indeed meet any other requirement to minimize the adverse effects of the termination of employment by way of redundancy. We note that these obligations were incorporated in the law through the amendment of 1997, with the enactment of Section 26B and this section was applicable to oral contracts only. 7.4 In the case of ZCCM v Jackson Munyika Siame and 33 others3 the Supreme Court stated that there is always a presumption that legislation is not intended to operate retrospectively but prospectively. Given the forgoing, we find no merit in ground one and it is accordingly dismissed. 7.5 With respect to ground two, the appellant has argued that despite having withdrawn the claim for the two motor vehicles, there is proof on the record of appeal that she did state in cross examination that she was still claiming for the said motor (cid:9) (cid:9) J21 vehicles. To support this claim, the appellant has placed reliance on the provisions of clause 1.1 and 1.7.1 of the respondent's condition of employment for non-unionised employee, 1998 found at page 85 and 86 of the record of appeal. On the other hand, the respondent has argued that the claim for two motor vehicles is unfounded as the conditions of service relied on by the appellant were not in force at the time, he was declared redundant. 7.6 (cid:9) We are of the view that the learned Registrar did misdirect himself in law and in fact by not considering the appellant's claim for two motor vehicles on the ground that the same was abandoned under examination in chief. It is clear from the evidence on the record that the appellant did in fact state that she wished the said claim to be reinstated. The conditions of employment for non-unionised employees relied on by the appellant under appendix 2 which provides for personal to holder cars, states that managers on Grade J and above with a valid driver's licence are eligible to be given personal to holder cars. In the facts on the record of appeal, it is clear that the appellant was not a manager but instead held a position of an assistant electrical engineer under Grade J. S J22 7.7 Notwithstanding the fact that the Learned Registrar had misdirected himself by not considering the claim for the two motor vehicles, we hold the view that had he properly directed himself, he would have nonetheless arrived at the conclusion that the appellant was not eligible to the same for reasons advanced in the preceding paragraphs 7.8 In addition, as already established above that the law applicable to the appellant's claim for redundancy package did not impose any requirement on the employer to meet any other requirement, save to make the requisite payment, in the same vein, the respondent's conditions of service of 1998 do not extend to the late Alex Ng'wane. Given this fact, it is clear that the late was not eligible to a personal to holder vehicle. Accordingly, ground two of appeal fails and is dismissed for lack of merit. 7.9 In relation to ground three, the appellant has argued that the procedure adopted by the learned Registrar in assessing the interest was wrong as he did not take into account the inflation of our currency. On the other hand, the respondent has argued that the learned Registrar did not misdirect himself and that the J23 respondent had not provided any tangible material on which the Registrar could rely on. 7.10 It is the view of this Court that the learned Registrar did not err both in law and in fact by calculating the interest in the manner he did. Having established that the late Alex Ng'wane's redundancy package should have been calculated based on the 1992 salary scale, the learned Registrar correctly used the average Bank of Zambia interest rate of the years 1993 to 2004 when the respondent made a payment into court. By so doing, he took into account the inflation of the Zambian Kwacha. The third ground also fails for lack of merit. All the grounds of appeal being devoid of merit, they are dismissed forthwith. The net result is that the appeal fails in its entirety. We will make no orders as to costs. F. M CHISANGA JUDGE PRESIDENT, COURT OF APPEAL. B. MTMAJULA (cid:9) P. C. M NGULUBE COURT OF APPEAL JUDGE. COURT OF APPEAL JUDGE.