Francis Mulenga and Ors v Local Authorities Superannuation Fund and Anor (Appeal No. 67 of 2007) [2009] ZMSC 180 (24 March 2009)

,,. Jl IN THE SUPREME COURT OF ZAMBIA APPEAL NO. 67 OF 2007 AT LUSAKA (Civil Jurisdiction) BETWEEN: FRANCIS MULENGA AND OTHERS APPELLANTS AND LOCAL AUTHORITIES SUPERANNUATION FUND 1 ST RESPONDENT ZAMBIA ELECTRICITY SUPPLY CORPORATION LIMITED 2ND RESPONDENT Coram: Chibesakunda, Chitengi and Mushabati; JJS On 30th September, 2008 and 24th March, 2009. For the Appellants: Mr. B. Katuta of Loboko Chambers For the 1st Respondent: Mr. J. Kalokoni of Kalokoni and Company For the 2 nd Respondent: Mr. M. Nchito of MNB Legal Practitioners JUDGMENT Mushabati JS, delivered the judgment of the court. Legislation referred to: Local Authorities Superannuation Fund Act, Cap 284 S.45(2) This is an appeal against the High Court Judgment of 8 th March, 2007 dismissing the appellants' claims. The appellants claims were for the sums of monies deducted from each of them when they were paid their terminal benefits by the 1st Respondent. J2 The undisputed facts of the case were that the appellants, who were the plaintiffs in the court below, were all former employees of the 2 nd Respondent. On their separation with their employer, they were paid their dues. They were not informed of any money owing to the 2 nd Respondent. Later they were paid their dues by the 1st Respondent. The 1st Respondent was instructed by the 2 nd Respondent to deduct the claimed sums of money from each of the appellants. The said sums were deducted and remitted to the 2 nd Respondent. The appellants were aggrieved by these deductions. Hence they commenced these proceedings, as a group action. The appellants called one witness namely, P. W.1, Godwell Simbeya, who, in this action was the 7 th Plaintiff. P. W.1 worked for the 2 nd Respondent from 1983 to 1992 as an electrical engineer. He, like his fellow claimants, contributed to the Pension Scheme managed by the 1st Respondent. On retirement one's particulars, which are documented, are submitted to the 1st Respondent by the 2nd Respondent. Any outstanding loans are indicated on the said documents and when the payments are effected the outstanding loans are deducted and remitted to the 2 nd Respondent. In this J3 case the appellants were not informed of any amount owing to the 2nd Respondent. Neither were the amounts reflected on the documents sent to the 1st Respondent, which meant they did not owe their former employers, the 2 nd Respondent, any money at all. When they were paid their lump sum gratuities, the appellants suffered some deductions which they disputed. The deducted amounts were reflected as over-payments to them. Under cross examination P. W.1 said the 1st Respondent deducted this money from the appellants' lump sum on instruction from the 2 nd Respondent, to whom the said money was remitted. The second Respondent called one witness. This was D. W. l, Mr. Dadly Maleche, who was the Pay Roll Administrator for the 2 nd Respondent. His duties, among others, included the management of staff pay roll, pensions and salaries. D. W.1 told the court that when the appellants' terminal benefits were being processed it was discovered that some over-payments were paid to the appellants. The 2 nd Respondent informed the 1st Respondent to deduct, from each of the appellants, the amount of money that was already paid to each of them. The 1st Respondent went ahead and deducted the said amounts and remitted them to the 2 nd Respondent. The above are the brief summaries of the evidence adduced in the J4 court below. The learned trial judge reviewed the above evidence and dismissed the appellants claims and condemned their advocate in costs as against the 1st Respondent for proceeding with the suit against the said 1st Respondent despite the fact that the 2 nd Respondent had admitted that the deductions suffered by the appellants, were at their(2nd Respondent's) instance or request. Three grounds of appeal were filed. The first two are in relation to the main action and the third one relates to the order of costs against the appellants' Counsel. The three grounds of appeal are: 1. The trial Judge misdirected himself in law and fact when he held that it is the Plaintiffs' former Employer Zesco the Second Defendant who did the deductions and NOT the Pension Fund-the 1st Defendant. 2. The trial Judge misdirected himself in law and fact when he held that the deductions were done within the ambit of the law. JS 3. The trial Judge misdirected himself in law and fact when he ordered that Costs for the 1st Defendant to be paid by Counsel for the Plaintiffs. These grounds were supported by written heads of argument on which the appellants relied. On the first ground it was argued that there was no dispute that the amounts in dispute were deducted by the 1st Respondent. The documents, in support of the deductions, were prepared by the 1st Respondent and not the 2 nd Respondent. On the second ground it was argued that the 1st Respondent could only eflect the deductions on behalf an Associated Authority under Section 45(2) of the Local Authorities Superannuation Fund Act, Cap. 284. The instructions must be in written form as per documents 93,96,101,105,113,117 and 121 in the record of appeal No such instructions were given to 1st respondent in respect of all the appellants. No written instructions, to the 1st Respondent by the 2 nd Respondent, were produced in court. In the absence of such written authority the 1st Respondent acted without legal authority. J6 On the last ground of appeal the Counsel argued that it was not fair to condemn an advocate in costs when his client lost the action. It is the duty of the advocate to give advice to their clients. Costs must be borne by the losing party and not the Lawyer as he is not the losing party. The appellants' witness never said he was advised by his Counsel to continue the action against the 1st Respondent. In reply to the appellants' written heads of argument the first Respondent argued the 1st and 2 nd grounds together and stated that from the beginning there was no contractual or employment relationship between the 1st Respondent and the appellants. These were employed by the 2 nd Respondent. It was through their relationship with the 2 nd Respondent that this action was commenced. The 2 nd respondent admitted giving instructions for the deductions to be made and so the 1st Respondent in its defence averred that the recoveries were done by the 2 nd Respondent. The 2 nd Respondent's instructions to the 1st respondent were confirmed by D. W.1 Mr. Maleche. The deductions were done in accordance with Section 45(2) of the Local Authorities Superannuation Fund Act, Cap. 284 of the Laws of Zambia. The interpretation of J7 this Section was simple and straight forward. The court, therefore, properly interpreted the law. On the third ground it was argued that Lawyers may not want to be personally condemned in court when conducting a client's case, but that there were exceptions when this may happen. This is possible when a lawyer fails to give proper advice to his client and he, himself, appears to be blame worthy in the matter. In the instant case since the 2 nd Respondent admitted giving instructions to the 1st Respondent and the appellants refused to discontinue the action against the 1st Respondent on their advocate's advice; the Counsel was therefore liable in costs. The second Respondent also filed in written heads of argument. The argument on the first ground was that the 2 nd Respondent merely gave instructors to the 1st Respondent to effect the deductions. The 1st Respondent effected the actual deductions. The beneficiaries of those deductions were the 2 nd Respondent. The deductions were effected because the 2 nd Respondent had over-paid the appellant. The 2nd Respondent had paid some terminal benefits to the appellants which were later discovered to have been over J8 payments. The court below was, therefore, justified when it dismissed the appellants' action because allowing it would have amounted to unjust enrichment of the appellants. On the second ground it was submitted that the money, which was deducted, was money which was over-paid to the appellants. The law authorizes such a deduction by the 1st Respondent on behalf of the 2 nd Respondent. The deductions were made within the provisions of the law. We have carefully considered the evidence, the judgment appealed against and the submissions by Counsel. It is clear to us that there is no dispute that the 1st Respondent effected the deductions, giving rise to these proceedings, at the request of the 2 nd Respondent, the former employer of the appellants. The crucial issue for consideration is whether the deductions were justified. The first Respondent said they effected the deductions on behalf of the 2 nd Respondent. This was in line with the provisions of Section J9 45 (2) of the Local Authorities Superannuation Fund Act Cap. 284. The appellants argued that the instructions should have been in writing. Section 45(2) of the Local Authorities Superannuation Fund Act States:- "If a member is indebted to the Associated authority, which employs or employed him, the committee shall, at the request of such authority, pay such debt to such authority by deduction from any benefit payable to such member or his dependant". The above provision of the law is clear. It says " at the request of such authority". It does not such without authority shall be in writing. The argument that the request or instructions should have been in writing cannot be sustained. As it was proved that the 2 nd Respondent had requested the 1st Respondent to effect the deductions against the appellants, the 1st Respondent acted lawfully. .. JlO In fact it is surprising that despite the unequivocal admission by the 2 nd Respondent to having given such instructions to the 1st Respondent, the appellants still chose to prosecute the action against the 1st Respondent. The 2 nd Respondent, through its witness, stated that the over Payments to the appellants were discovered after the documents had already been sent to the Local Authorities Superannuation Fund. The 2 nd Respondent then requested the 1st Respondent to effect the deductions from the appellants' benefits on their behalf. The appellants argued that had they owed the 2 nd respondents any money such sums ought to have been reflected on the documents sent to the 1st Respondent by the 2 nd Respondent. In considering this issue the trial court made a finding of fact that the appellants owed the 2 nd respondent some money through over payments. We agree with this finding. The omission could have been as a result of a human error. The request was, however, made by the 2 nd Respondent. Looking at the evidence on record we have no doubt that the court below was entitled to make such a finding. The very fact that the .., Jll request was not made in writing that did not absolve the appellants of their indebtedness. The main appeal by the appellants has no merit and it is dismissed with costs as against the 2 nd Respondent. The court below ordered the costs for the 1st Respondent to be borne personally by the appellants' advocate. This is the subject of the third ground of appeal. The Advocate was condemned in costs for failing to properly advise his clients as against the 1st respondent's liability. The court below said the appellants' witness had said he could not withdraw or discontinue the action against the 1st Respondent on his advocate's advice. We have looked at the evidence on record. Though P. W.1 was asked by the court whether he still wished to maintain his claim against thel st Respondent, he did not say he could not do so on the advice of his advocate. However looking at the nature of the case, the evidence on record and what transpired in court we J12 are satisfied that had the Counsel been sincere with his client, he would have advised him to discontinue the action against the 1st Respondent. Admittedly in normal circumstances costs follow the event or payable by the losing party but a court has a discretion to condemn a lawyer to personally pay the costs if it is shown that he did not act with due diligence. An advocate has a duty not only to his clients but to the court as well. He should never deliberately mislead the court on any point of law or fact. The appellants' Counsel's conduct in this matter showed that he negligently or deliberately failed to properly advise his client as against the 1st Respondent's liability. When we heard this appeal we asked Counsel to show cause why we should not confirm the lower court's order on costs against him. In reply he said the court below erred in condemning him in costs because costs are paid by the losing party and not a lawyer, who is not the losing party. A losing party is his client. J13 We were not satisfied with his explanation. The court below was justified in condemning him in costs. The third ground of appeal is, therefore, dismissed. We must, however, add here that should a court decide to condemn an advocate in costs such an advocate must be afforded an opportunity to be heard i.e. to show cause why he should not personally be condemned in costs. The appeal against the award of the 1st Respondent's costs against the appellants' Counsel is dismissed with costs both here and in the court below. L. P. Chibesakunda SUPREME COURT JUDGE SUPREME COURT JUDGE SUPREME COURT JUDGE