Kenneth Walembi Kajimana (Suing as Administrator of the estate of the late Andy Nyiwangu Kanjimana(MALE) v The Attorney General and Anor (2010/HP/293) [2019] ZMHC 38 (13 March 2019)

J1 IN THE HIGH COURT OF ZAMBIA AT THE PRINCIPAL REGIST HOLDEN AT LUSAKA {Civil Jurisdiction) PRIN .,IPA BETWEEN: 1 3 MAR 2019 --·· ............. KENNETH WULEMBI KANJ m..e~n~~7.=:i=~ (Suing as Administrator of the estat"i"'i..,.,._.+,,,,,-_. late Andy Nyiwangu Kanjimana(MALE)) AND 2010/HP/293 PLAINTIFF THE ATTORNEY GENERAL PUBLIC SERVICE PENSIONS FUND BOARD 1 st DEFENDANT 2nd DEFENDANT BEFORE HON MRS J USTICES. KAUNDA NEWA THIS 13th DAY OF MARCH, For the Plaintiff Mr M. Chitambala, Lukona Chambers For the 1st Defendant Ms D. Mwewa, and Ms A. T. Msiska State Advocates For the 2 nd Defendant Ms N. Matele, in house Counsel JUDGMENT CASES REFERRED TO: 1. Jefford and Another v Gee 1970 1 All ER120 2. Herbert Ijegalu Okwa Ozokwo V The Attorney-General (No 2) 1985 ZR218 3 . Duly Motors (Z) L td V Patrick Katongo and Livingstone Motor Assemblers 1986 ZR 61 4. Irene Chinjavata V The Administrator-General 2004 ZR 184 5. Andrew Mulimba and John Mulimba V The Attorney General Appeal No 117/2005 LEGISLATION REFERRED TO: 1. The High Court A ct, Chapter 27 of the Laws of Zambia 2. The State Proceedings Act, Chapter 71 of the Laws of Zambia J2 3 . The Judgment s Act, Chapter 81 of the Laws of Zambia 4. The Public Pensions Act, Act No 35 of 1996 The Plaintiff comme nced this action on 25th March, 2010 by way of writ of summons which w as amended on 25th October, 2018 claiming; 1. Payment by the 1st and 2nd Defendant of the sum of K94, 791, 052. 00 being the loss in value of the pension difference due and payable to the late Andy Nyiwangu Kanjimana in February, 1993 but only paid on 28th February, 2007 as at the date of such payment. 2. Interest on the amount due and payable to the Plaintiff referred to above from 11 th September, 2004 to date. 3. Any other relief that the court may deem fit. 4. Costs. The amended statement of claim shows that on or about 28th Feb ruary, 1993, the 1st Defendant retired the late Andy Nyiwangu Kanjimana in the national interest who at the time held the position of Assistant Secretary in the Provincial Administration, North Western Province under the Office of the Presiden t. It is stated that prior to being retired, the late Andy Nyiwangu Kanjimana was promoted to the position of Deputy Permanent Secretary effective 1st July, 1992. When retiring the late Andy Nyiwangu Kanjimana, the 1st Defendant omitted to retire him a s Deputy Permanent Secretary and only corrected the error by a letter dated 10th September, 2004 . Upon rectification of the error state d above, the 1st Defendant on or about 28th February, 2007 proceeded to pay the Plaintiff the sum of K4,016, 570.00 (unrebased) as J3 the difference in the pension between the amount paid to the Plaintiff on retirement in February 1993 and the current pension due at the time of the said retirement. It is stated that the 1st and 2 11d Defendants despite acknowledging that the Plaintiff is entitled to the difference in his pension at its economic value on payment, have refused, failed and or neglected to pay the Plaintiff the true value of his pension d ifference taking into account inter alia the rate of inflation. The 2°d Defendant filed a defence on 5th May, 2010 in which it admits the Plaintiff's claims with regard to his employment and the position that he held prior to his retir ement, and the position that he was retired at. The 2 nd Defendant alleges that the rectification of the error of retiring the Plaintiff as Assistant Secretary instead of Deputy Permanent Secretary and the subsequent payment of K4, 016,570.00 (unrebased) as the difference in pension between the amount paid to the Plaintiff on retirement in February, 1993 and September, 2004 was in accordance with the provisions of the Public Service Pensions Fund Act No 35 of 1996. The 2 n d Defendant alleges that the issues are between the Plaintiff and the 1st Defendant because the Public Service Pensions Fund Act does not provide for the indexation of pension benefits, and therefore, the claim should be directed to t he Plaintiff's former employers who occasioned the error. The 1s t Defendant did n ot file a defence but stated that they would file an agreed statement of facts. The parties also stated that they would file J4 written su bmissions and the court would thereafter deliver its judgment. The agreed facts on 20t h February, 2019 are as follows; 1. That the Plaintiff was at all material times the Administrator of the estate of the late Andy Nyiwangu Kanjimana who was employed in the Public Service of the Government of the Republic of Zambia. 2. The 1st Defendant is the Chief Legal Advisor to the Government of the Republic of Zambia and is cited in these proceedings pursuant to Section 12(1) of the State Proceedings Act, Chapter 71 of the Laws of Zambia. 3. The 2 nd Defendant is and was at all material times a statutory body incorporated by Act No 35 of 1996 and is responsible for managing the benefits of Public Service Employees of the Government of the Republic of Zambia. 4. The 1st Defendant on 28th February, 1993 retired the Plaintiff in the national interest. At the time of his retirement the Plaintiff held the position of Deputy Permanent Secretary m the Provincial Administration, North Western Province under the Office of the President. 5. Prior to the Plaintiff's retirement, on or about 1st July, 1992, the Plaintiff was p romoted to the position of Deputy Permanent Secretary. However, when retiring him the 1s t Defendant erroneously retired him as Assistant Secretary and only corrected the error by a letter dated 10th S eptember, 2004, causing an underpayment of the lump sum pension in the sum of K4, 016,570.00 (unrebased). 6. On or about 28th February, 2007, the 1s t Defendant paid the Plaintiff K4, 016,570. 00 (unrebased) as the difference in pension between the JS amount paid to him on retirement in Fe bruary, 1993 and the correct pension due at the time of the said retirement. 7. That following the said payment referred to above, the Plaintiff claims the sum of K94, 791, 052.00 (unrebased) being the loss in value between February, 1 993 when the said pension difference should have been paid and 28th February, 2007 whe n it was paid. 8. Both the 1s t a nd 2 nd Defendant contend that the Plaintiff was paid the difference of his pension through the 2 nd Defendant. ISSUES TO BE DETERMINED 1. Whether or not the Plaintiff is entitled to compensation by the 1s t and 2 nd Defendant f or the loss in the value of the pension difference due and payable to the late Andy Nyiwangu Kanjimana in February, 1993 but only p aid on 2 8th February, 2007? 2 . Whether interes t on the amount claimed as due and payable to the Plaintiff can attract interest from 11 th September, 2004 to the date of payment? The Plaintiff filed su bmissions on 19t h February, 2019 in which it is stated that the Plaintiff claims the amount of K94, 941 , 052.00 (unrebased) which is the difference in value of the pension that was payable to the late Andy Nyiwangu Kanjimana in February, 1993 but which was only paid on 28 th February, 2007. It is argued that it h as been demonstrated by the pleadings and the evidence that the Plain tiff was erroneously retired as Assistant Secretary instead of Deputy Per manent Secretary, which is the position that he was promoted to prior to his retirement and the error resulted in the J6 Plaintiff being unde rpaid the amount of K94, 941, 052.00 (unrebased). That this is proved by the letter dated 10th September, 2004 under the hand of the then Permanent Secretary at the Public Service Management Division which is at pages 1-2 of the Plaintiff's bundle of documents. The Plaintiff contends that the amount of K4, 016, 570.00 (unrebased) which was suppose d to have been paid to him when he retired m February, 1993 was only paid on 28th Feb ruary, 2007 after the 1st Defendant corrected the error, and the document at page 5 of the Plaintiffs bundle of documents is evidence of the payment. Therefore, it could not be denied that the Plaintiff had been deprived the use of the amount of K4, 016, 570 .00 (u nrebased ), and he consequently suffered loss of use of the said money, and is entitled to be compensated. That th is is especially because the difference in the amount paid was only p aid to the Plain tiff on 28th February, 2007, when it should have been p aid in February, 1993, being fourteen (14) years later. The case of Herbert Ij egalu Okwa Ozokwo V The Attorney•General (No 2) r21 which held that; "Awards to a plaintiff who has wrongfully b een deprived of something must be realistic and afford a fair recompense" was relied on, stating tha t in that case the Supreme Court adop ted the principle in the case of Jefford and Another V Geef1J when it stated that; "There is an abunda nce of authority and especially the case of Jefford and Another v Gee (1970)(1) All E. R . 120(1), which, although it has been qualified by latter judgments, remains i n effect in this re spect, that a plaintiff who has been deprived of his money must J7 be paid a reasonable rate of interest from the time when he was first wrongfully deprived, in order to recompense him. We agree entirely with this authority and this court has always applied that principle. Howeve r, in the extraordinary circumstances which apply today whereby inflation has made old values meaningless, awards to a plaintiff who has been wrongly deprived of something must be realistic and afford a fair recompense". It was submitted that the letter from the Central Statistical Office at pages 3-4 of the Plaintiff's bundle of documents shows the loss in value of the sum of K4, 016, 570.00 (unrebased) from February, 1993 to 28th February, 2007 when it was paid. The case of Duly Motors (Z) Ltd V Patrick Katongo and Livingstone Motor Assemblers f3J was relied on with regard to awards where there has been inflation. It was held in that case that; "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". That this was reiterated in the case of Irene Chinjavata V The Administrator-Gene ral f4J. On the interes t due on the amount, the submission was that the amount that was erroneously paid to the Plaintiff was only rectified by a lette r dated 10th September, 2004, which is at pages 1-2 of the Plaintiff's bu ndle of documents. It was submitted that Order XX. XVI Rule 8 of the High Court Rules, Ch apter 27 of the Laws of Zambia provides that; J8 "8. Where a judgm ent or order is for a sum of money, interest shall be paid thereon a t the average of the short-term deposit-rate per annum prevailing from the date of the cause of action or writ as the court or judge may direct to the date of judgment". That furthe rmore, Sections 2 and 3 of the Judgments Act, Chapter 81 of the Laws of Zambia provide for the payment of interest on any judgment d ebt from the date of such judgment until p ayment. The case of Andrew Mulimba and Joh n Mulimba V The Attorney Generalf5J wh ere the Supreme Cou rt held that; "Order 36 Rule 8 of the High Court Rules provides mandatory terms for an award of interest to a successful litigant ...... For the foregoing reasons, we hold that the proper interpretation of our judgment is that the State is liable to pay interest as stated in Order 36 Rule 8, ie from commencement of the action to the date of judgment", was also relied on. I have considered the evidence and the submissions. In this matter it is agreed that the late Andy Nyiwangu Kanjimana was employed in the Public Service, and that he was retir ed in the n ational interest on 28th February, 1993. It is also agreed that the late Andy Nyiwangu Kanjimana was retired in the position of Assistant Secretary wh en in fact he had b een promoted to th e position of Deputy Permanent Secretary effective on or abou t 1st July, 1992, and should h ave b een retired in that position. It is agreed that the error in retiring the late Andy Nyiwangu Kanjimana as Assistant Secretary instead of as Deputy Permanent Secretary was corrected by way of letter dated 10th September, 2004, and the late Andy Nyiwangu Kanjimana was paid the amount of K4, 016, 570.00 J9 (unrebased) being the difference in the p ension benefit on 28th February, 2007 that was paya ble when he retired on 28th February, 1993. The Plaintiff claims the difference in the value of the K4, 016, 570.00 (unrebased) from the time that it was due for payment in February, 1993 to 28th February, 2007 when it was paid being, K94, 791, 052.00 (unrebased). The Plaintiff relies on the document at page 13 of the Plaintiff's bundle of documents which is the document from the Central Statistical Office d a ted 23rd August, 2013 , which took into account the inflation and gave the value of K4, 016 , 570.00 (unrebased) as at February, 1993, as a t July, 2005, as ZMW 112, 624.62. The document at pages 1-2 of th e Plaintiffs bundle of documents dated 10th September, 2004 shows that the re tirement of the late Andy Nyiwangu Kanjimana on 28th February, 1993 in the national interest in the position of Assistant Secre tary was rescinded, and h e was deemed to have been substantively promoted as Deputy Permanent Secretary with effect from 1st July, 1992 and deemed to have retired from the Civil Service in the national inte rest on 28th February, 1993. Going by that letter, it can be seen that the late Andy Nyiwangu Kanjimana was wrongly retired in the position of Assistant Secretary but this was rectified to show that he was retired at the position of Deputy Permanent Secretary. The wrongful retirement resulted in the difference in the pension benefits being paid in the amount of K4, 016, 570.00, in J uly, 2005 as seen on the payment voucher at page 5 of the Plaintiff's bundle of documents . Clearly, the Plaintiff was deprived of the use of that money that was payable in February, 1993 and which was only p aid in July, 2005, a period of over twelve years later. no From the authorities cited by the Plaintiff, he is entitled to be paid for the loss of use of that money at a fair recompense, as the 1st Defendant erred in retiring him in the wrong position which resulted in him being underpaid. The difference in the amount due was paid over twelve years later as seen, and going by the rate of inflation that occurred that amount of money as seen at page 13 of the Plaintiff's bundle of documents, was valued at ZMWl 12, 624,62. The letter at pages 10-11 of the Plaintiff's bundle of documents dated 28th November, 20 08 shows that the 1st Defendant agreed to pay the Plaintiff the loss of value of the K4, 016, 570.00 (unrebased) as the letter shows it had sought clarification from the Central Statistical Office on the value of K68 7, 174.00 (unrebased) being Kl 7, 845, 606.42 (unrebased) after taking into account inflation . Therefore, the 1st Defendant having agreed to pay the Plaintiff the difference in the amount of pension due to the Plaintiff at a rate that took into account inflation as calculated by the Central Statistical Office, it is liable to pay him t h at amount. The 2 nd Defendant's defence was that the issues were between the Plaintiff and the 1 st Defendant as it is the 1 st Defendant that retired the Plaintiff in a wrong position resulting in the underpayment that was subsequently rectified. The 2 n d Defendant admitted that it calculated the difference in payment that was due and it was paid. However, in so calculating the Public Service Pensions Act does not provide for the indexa tion of payments. This was not disputed by the Plaintiff. Section 41 of t he Pu blic Service Pensions Act No 35 of 1996 provides as follows; J11 "41. Subject to the provisions of Part X , an officer who retires under section thirty-three on grounds other than those described in sections thirty-nine a nd forty shall, with effect from the date of the officer's retirement, be entitled- /a) if the officer's pensionable service amounts to less than t en years, to a lump s um calculated as follows : SC + (SC X IX Y); or (b) if the officer's pens ionable service amounts to ten years or more, to a pension calculated as follows: KAxB; C Where KA= the officer's pensionable emoluments; B = the number of completed months of the officer's pensionable service; C = the age at which the officer retires expressed in complete months; SC = the sum of the officer's contributions; I = interest at current Ce ntral Bank deposit rate; Y = the number of completed years in respect of which the officer has contributed". Part X deals with miscellaneous provisions while Section 33 of the Act states that; J12 "33. Subject to the other provisions of this section or any other written law, an officer shall retire on the fifty-fifth anniversary of the date of his birth : Provided that• (i) any member of t h e Defence Forces, or an officer of or below the rank of Chief Inspector in the Police Force, or an officer of or below the rank of Chief Officer III in the Prisons Service, may, on giving due notice, retire o n or after attaining the age of forty:ftve years or after completing twe nty years service whichever is the earlier; (ii) the appropriate a uthority may, in consultation with the Board, prescribe earlier or later dates for the retirement of all or any of its officers". I have combed through the Act and h ave not found any provision that relates to the indexing of pension benefits, and therefore the 1st Defendant having agreed to index th e amount of K4, 016, 570.00 which was the difference p ayable as the pension benefit s due to the Plaintiff after h e was retired in the wrong position, is liable to pay the indexed amount, and not the 2nd Defendant. I accordingly enter jud gment in favour of the Plaintiff for t he sum of K94, 791 , 052.00, being the loss in value of the pension difference th at was payable to the Plaintiff against the 1st Defendant. As regards t h e interest p ayable on that amount, the Plaintiff claims that interest should be p aid from 11 th September, 2004 until the date of p aym ent. Reference was made to Or der XX. XVI Rule 8 of th e High Court Rules, Chapter 27 of th e Laws of Zambia which provides that; J13 "8. Where a judgment or order is for a sum of money, interest shall be paid thereon at the average of the short-term deposit-rate per annum prevailing from the date of the cause of action or writ as the court or judge may direct to the date of judgment". Further, Section 2 of the Judgments Act, Chapter 81 of the Laws of Zambia provides that; "2. Every judgment, order, or decree of the High Court or of a subordinate court whereby any sum of money, or any costs, charges or expenses, is or are to be payable to any person shall carry inte rest as may be determined by the court which rate shall not exceed the current lending rate as determined by the Bank of Zambia from the time of entering up such judgment, order, or decree until the same shall be satisfied, and such interest may be levied under a writ of execution on such judgment, order, or decree". Therefore, going by the above provisions, the interest payable from the time the writ is issued up to the time that judgment is entered is at the sh ort-term deposit rate , and thereafter at a rate not exceeding the Bank of Zambia lending rate until payment. However, this action has succeeded against the Attorney General. Section 20 of the State Proceedings Act provides that; "20. The Minister res ponsible for finance may allow and cause to be paid out of the g e neral revenues of the Republic to any person entitled by a judgment under this Act to any money or costs, interest thereon at a rate not exceeding six per centum from the date of the judgment u ntil the money or costs are paid". J14 Thus, while Section 2 of the Judgements Act, Chapter 81 of the Laws of Zambia provides that the rate of interest payable after judgment is entered is at a rate n ot exceeding the Bank of Zambia lending rate, where the judgment is again st the Attorney General, the rate payable is at six percent until payment. I therefore order that the amount of K94, 79 1, 052.00 (unrebased) or ZMW94, 79 1.052 entered as the judgment sum shall carry interest at the short-term deposit rate from the date of issue of the writ until judgment, and thereafter a r ate of six (06) percent until payment. The Plaintiff is also awarded costs to be taxed in default of agreement. Leave to appeal is granted. DATED THE 13th DAY OF MARCH, 2019 S . KAUNDA NEWA HIGH COURT JUDGE