Matsiko v Banyankole Kweterana Corporative Union Limited (Civil Suit 36 of 1997) [1998] UGHC 22 (9 March 1998)

Full Case Text

### THE REPUBLIC OF UGANDA

IN THE HIGH COURT OF GANDA AT KAHPALA

### CIVIL SUIT 36/97

JOHN WATSIKO ....................................

- YERSUS -

BANYANKOLE KWETERANA CO-OP. UNION LTD ....... DEFENDANT

#### **BEFORE THE HONOURABLE LAGY JUSTICE C. K. BYAMUGISHA**

#### **JUDGENENT**

The plain! Iff John Matsiko brought this action against his former employer claiming a number of reliefs which are contained in paragraph seven of the plaint.

The plaintiff was first empioved by the defendant as a General Manager for a period of four years from February 199? to the end of January 1995. The contract was renewed for another four years from 1995 to February 1999. Before the expiry of this contractual term, the defendant on 24th November 1996 terminated the contract under clause sleten of the contract of service. The plaintiff was not paid his terminal benefits. He therefore brought this action to claim them:

The defendant in its written statement of defence and counter-claim denied the allegations in the plaint and contended that the plaintify had poor working relations with members of the union which affected their good will, leading to poor patronage and loyalty. There was a dounter claim fur the recovery of Shs. 557,789,802/= room the plaintiff as financial loss caused by the plaintiff's mismanagement of the union uffairs.

During the hermag of the suit, the definite abandoned the bounter-claim and

be paid shs. 10,581,304/ as terminal benefits Judgment was therefore entered in favour of the plaintiff in the stated sum plus costs. conceded that the plaintiff is entitled to

**i**

determination *are:-* The only issues which remained for

(1) (2) General damages, if any; How much is the plaintiff entitled to as terminal benefits under the contract;

In order to determine the first isfsue regard must be had to clause eleven **i** under which the plaintiff's employ merit Jontract was terminated. The clause states that:-

**I**

to run it to full course." specifying reason on payment of rche salary for the unexpired period plus **i** a sum representing a fair valuation of ?oss of contract had it been allowed "The union may terminate the! employment of the employee without

clause "on payment of the salary." up the salary. Counsel also pointed out fhat clause 2(b) indicates that salary includes basic salary, entertainment allowance. He therefore contended that if the **■Z** accidental. The plaintiff nad a basic salary of shs. 200,000/= and other fringe benefits. According to the pay slip (exhibit P.4) he had defendant had intended to pay only the basic salary under clause eleven of the expressly, and that the omission Both counsel submitted on this clause pnd in particular what is meant by the a gross pay of shs^ contract it should have stated so was not The defence contended that the salary I referred to was the basic salary. The plaintiff's counsel disagrees stating that clause 2(a) of the contract indicates basic salary and other entitlements that make 600,000/= and his net pay was shs. 4AR 5oO/-=. Under clause 2(b) it was provided

> i 2;

**I**

**2**

that in computing the psokage, only the basis salary entertainment allowance and cost of living responsibility allowance shall be calculated. This was for purposes of calculating gratuary put I think the sold formula would apply if the contract is terminated under clause eleven.

While I agree with the submission of counsel for the plaintiff that the use of the word "salary" and not "basic salary" was not accidental. I do not agree with him that the calculations should be based on gross pay. The pay slip shows that the plaintiff's net pay was shs. $486,500/$ = per month. This in my view should form the basis of the calculations. The plaintiffs contract had been left with 27 months to end. This will give a figure of ans. (4,399,500/= which is due to the plaintiff instead of the sum of shs. 10,581,304 admitted by the defence.

As to the fair sum representing the $\mathfrak{loss}$ of contract, it is not clear what this means. However counsel for the plaintiff referred me to the case of Gulaballi Ushalani vs Kampals Pharmsceuticni (td. | H. O. C. S. No. 349/93 in which Ntabgoba P. J. awarded the sum of shs. 7.0.0,000/= for general loss of employment to the $\kappa$ plaintiff. He invited court to award the plaintiff a sum of $15,000,000/$ = on this head. The defendant's counsel opposed $\mathfrak{U}_i$ is by contending that the case cited is distinguishable. Since the authorities on the subject are scanty, I will do the best I can in the circumstances of the mass, bench is clear the plaintiff lost the contract under circumstances which are not clear, he is entitled to be $\mathbf{2}$ compensated for this loss. The issue if one of quantum. Working on the assumption that the loss of his employment noused him to lose his entitlements under the contract, I will award him the $\epsilon$ um at shall 5 million under this head.

The last plaim is gratuity. The continent provided for payment of gratuity to be paid at the end of the contract. This if no, thined in clause 2b. The gratuity $2s$ however was hit payable to the plaintiff if his in threat was terminated under

clause 7(b)(c)(d) and (f), which was n ot ti) e case here.

. The defence disputed this figure contending that the plaintiff was snot enti\* vo any gratuity since he caused financial loss to the defendant. With respect I think the plaintiff was not *£* There was no proof of this financial loss cannot be used in my view t6 deprive che dismissed for causing financial loss to the'defendant. and the counter-claim was withdrawn with costs. The unproved allegations about Counsel for the plaintiff worked out a figqre in accordance with clause 2B of the contract. The figure arrived at is shs ''"I '-n.030/

plaintiff the gratuity due to him under the contract. I therefore I accept the *IO* figure of shs. 38.400,000/ = and award it.

It is true the under tne terms of emoioy ment. I therefore! decline tn award him general damages. The last claim is 'or general damages fop breach of contract, **i** plaintiff's contract was prematurely termin'ated but the defendant was not obliged **i** to employ him to the full term. He can onjy get what is due to him as provided

Consequently, judgment will be entered in favour of the plaintiff against I the defendant under the following terms:-

(1) salary of the unexpired period of the contract; He is awarded the sum of shs. 13,38H.\*onz-

- (2) The sum of shs. 5,000.000/= for loss pf - (3) Shs. 38,400,000/= as gratuity. - (4) The above sums will carry interest at the date of judgment till payment in full.

**. I'**

**I**

Judge 09/03,4\*8

(5) He is awarded the taxed costs of thejsuit;

$-74$

# THE REPUBLIC OF UGANDA

# OURT OF UGANDA AT KAMPALA

## CIVIL SUIT No.36 OF 1997

......... PLAINTIFF

#### **VERSUS**

## BANYANKOLE KWETERANA CO-OPERATIVE UNION...................................

# DECREE

This suit coming for final disposal before Her Lordship Hon. Justice C. K. Byamugisha this 9th day of March 1998 in the presence of Mr. Kenneth Kakuru counsel for the plaintiff and Mr. Obed Mwebesa holding brief for Mr. Rukutana, counsel for the defendant,

IT WAS ORDERED AND DECREED as follows:

$\langle$

$1.$ The counterclaim is withdrawn against the plaintiff with costs.

2. That judgment is hereby entered against the defendant in favour of the plaintiff as follows:

| a) | Salary for the unexpired contract period | 13,389,500/ $=$ | |--------------|------------------------------------------|-----------------------| | b) | Loss of contract | $5,000,000/=$ | | $\mathbf{c}$ | Gratuity | $\ldots$ 38,400,000/= |

Costs of the suit $d$ )

Interest on decretal sum at Court rate from date of judgment until payment in $e)$ full

DATED at Kampala this day of 1998

$F$ *n*::

COURT? ?? JUDIC

.c COUNSEL FOR THE PLAINTIFF

FBE PAIRCOOL $-1 + 13.21.21$ $P|S|$ **RECT**

$R$ : $Q$