Ojwang v Uganda Railways Corporation (Civil Suit 468 of 1993) [1994] UGHC 74 (22 June 1994)

Full Case Text

## IN THE HIGH COURT OF UGANDA

AT KAMPALA

CIVIL SUIT NO. *^68* OF 1993

JAMSON OJJANG ::::::::::::: PLAINTIFFF

## ■" VERSUS

UGANDA RAILWAYS CORPORATION :::::::::: DEFENDANT BEFORE: THE HON. MR. JUSTICE G. M. OKELLO

JUDGMENT:

**la** this action, the plaintiff claims against the defcndunt:- (a) A declaratory order that the Uganda Railways Corporation computes the Plaintiff's salary using the new scale and pay **, r** the Plaintiff,

- (b) Interest at the rate of 38% from the date the sum fell due on 2/10/92, and - (c) cost of this suit.

The background of the case is brief:- The plaintiff was employed by the defendant corporation on 24/4/72. He rose through ranks until he became a supply officer of the corporation on salary scale 7 when his services were terminated by a letter dated 51-8-92. This was a permanent and pensionable post. The letter of termination was received in evidence and marked Exh. P1. According to the letter (Exh. P1) the plaintiffs services were effectively terminated on 31/8/92. But the letter was served on him on 11/9/92 and he continued to work until 30/9/92. The letter provided for payment of his terminal benefits after he surrendered the company1 property in his custody. The terminal benefits to be paid were:—

• •/2.

(1) Lon^ service Award and Appreciation Award- 3,3^0,400/= (2) Terminal Leave Settlement - 178,768/= (3) Transport Allowance - 18,130/~ Total \_\_"\_^\_2i537j29L/=

The above were computed up to 31/8/92. He was also to be paid one monthrs salary in lieu of Notice upon his surrendering his identity card and/or pass issued to him by the company. All the above were paid on 1/10/92 when the Plaintiff surrendered all the property of the corporation in his custody.

complained The plaintiff / that he was under paid his terminal benefits because by a circular letter ref: CAM/PS/3/8 of 21/10/92, there was a general salary increase for the corporation staffs with effect from 1/9/92. This circular letter was received in evidence and was marked £xh. P2. The Plaintiff argued that his terminal benefits were computed cn the old salary scale. He reasoned that since his services were effectively terminated on 30/9/92 he was entittled to the benefit of the new salary scale. That his terminal benefits ought to have been computed on the basis of the new salary scale because he ha.l worked up to 3°/9/9?«

In paragraph 4 of its the defendant pleaded thus:-

"Paragraph 4 is denied. The defendant's contention is that'the Plaintiff ceased to be an employee of the defendant on 31/8/92 and as such he was not entitled to the benefits of the new salary scale effective 1st September 1992."

The defendant clearly denied that the Plaintiff was entitled to the benefits of the new salary scale which came into effect on 1/9/92 the reason being that the Plaintiff's services with the defendant were terminated effectively on 31/8/92.

= 2

$wa$ This case/characterised by delays in starting of the hearing. After two or so adjournments the hearing of the case was eventually called the plaintiff started on 8/4/94. Counsel for the Plaintiff-as the sole witness and closed his case. Then counsel for the defendant who apparently did not have her witnesses in court applied for adjournment to enable her summon her witnesses. The application was readily allowed and the adjournment sought was given to 8/6/94. On this adjourned date, counsel for the defendant did not appear. She instructed a colleague of hers to seek adjournment on the ground that she was doing an examination in chartered secretary and Administration and also that she was on leave. As the adjournment was given at her instance, I rejected those reasons as being insufficient. Examination and leave are not sudden occuraness. They are planned events which the learned counsel ought to have known of or planned it much earlier. I regarded those reasons as mere ploys aimed at delaying the disposal of the case. When I rejected the application for adjournment, the learned counsel who held the brief submitted that she could not proceed because she did not have her witnesses in court and secondly that she had another case before justice Tsekooko. Then I allowed counsel for the Plaintiff to proceed to address me on the case.

$\overline{3}$

At the commencement of the hearing, a sole issue had been framed as under for the determination of the court:-

Whether the Plaintiff has been under paid by the defendant? Mr. Kavuma Kabenge argued for the plaintiff that the unchallenged evidence of PW1 shows that the letter of termination (Exh. P1) was forwarded to the Plaintiff on 11/9/92. But that even then, the plaintiff continued to work until the end of September 1992 because the money to pay his terminal benefits was not yet in place. That since the salary increment came into effect on 1/9/92, the plaintiff

$.0/4.$

who had worked for the whole of that month of September was entitled to the benefit of that increment. He pointed out further that according to the evidence of PW1, the factor (Multiplier) of the increment in the case of the Plaintiff's Grade was 2.1. He submitted that that factor be applied to the terminal benefits computed. That would bring a total dues payable to the Plaintiff to 7,101,870/= less the amount paid (shs. *3,537,29^/=)•* That this would leave a balance of shs. 3»5c>^«562/<m to be paid to the plaintiff. He prayed that court orders the defendant to pay the plaintiff that amount. He also prayed for cost of the suit.

I have considered the above arguments. It is trite lav/ that an imployee is entitled to his terminal benefits on termination of his contract of employment. Section 19 of the Employment Decree 4/1975 says,

''Where service is terminated under section 20 or 24 of this Decree, the employer shall pay to the employee wages or other remuneration due to the employee under the contract of service". Termination under section 20 referred to above is either by expiration of the term of the contract or by death. Termination under section 24 referred to above is by notice.

In the instant case, the dispute is not whether the Plaintiff was or was not entitled to his termination benefits on termination but rathe on the rate to be applied. This answer to the question hinges on when the services of the Plaintiff were terminated. If they were terminated on ^1/8/92 as the defendant claims, then the Plaintiff was not entitled to the benefit of the new salary scale which came into effect on 1/9/92. But if his services were terminated on 30/9/92, then the Plaintiff was entitled to the benefit of the New salary scale because the new scale would have come into effect when he was still an, employee of the defendant. This would bo his basis of entitlement.

first paragraph of the letter of termination (ExhP1.) reads thus;-

*& 5*

"By virtue of powers conferred upon the Board of Directors of Uganda Railways Corporation by S. 17 of East African Railways Corporation (Appointments and Discipline) Regulations 1974, it has been resolved that your services be terminated with effect from 31st August 1992".

Clearly, the effective date of termination of the services of the Plaintiff with the defendant according to that letter was 31/8/92. But there is the evidence of PW1 which shows that the letter was served on him on 11/9/92 and that because the money to pay his terminal benefit was not in place, he worked until 30/9/92. There is no evidence that the defendant had allowed him to continue to work up to that period because there was no money to pay the Plaintiffs terminal benefits. This appears to have been the unilateral decision of the Plaintiff himself.

The letter Exh P1 • indicated that the Plaintiff would be paid his terminal benefits as soon as he handed over the corporation property in his custody. Paragraphs 3 und 4 of the letter particularly say,

''Whereas you may stay in the residential premises occupied by virtue of your employment up to 30th September 1992, you are advised to surrender and/or hand over such residence to the secretary for the Housing Committee or other alternative authority as soon as possible upon which you will be paid your terminal benefits as laid down hereunder\*,

| (a) | Long service Award, Appreciation Award | | 3,340,400/= | |-----|----------------------------------------------------|-----|-------------------------| | (b) | Terminal Leave Settlement | - | 178,768/= | | (c) | Transport Allowance | -i- | 18,130/= 3,537,298/= | | | | | |

Further, you are advised that you will be paid one month's salary in lieu of Notice after you have surrendered the identity card and/or pass issued to you by the corporation".

The above passage in the letter Exh. P1 clearly pegged the payment of the Plaintiff's terminal benefits and his one month's salary in lieu of notice on the plaintiff handing over the corporation's property which included identity card and (or pass issued to him by the company. \_ne sooner the Plaintiff handed those property the earlier he was to get his payment.

Under cross-examination, the Plaintiff (PY/1) answered that he handed over his identity card on 1/10/92 and he was also paid on that day. That he could not hand over earlier because the defendant had no money to pay him. I do not agree with that reason. It was speculation There is no evidence to support this claim of no money. It was made clear that the condition precedent to his payment was his handing over the corporation's property which included the identity card and/or pass issued to him by the corporation and were still in his custody. He delayed in handing over the property and his payment was also withheld. When he handed over the property his payment was also -affected at once. From the above, I am convinced that the Plaintiff's continued service with the defendant from 1st *I* September, 1992 until 30/9/92 was of his own making. It was due to his own delay in handing over the corporation's property which were in his custody that his payment was delayed. He was allowed to continue to occupy the Residential premises to give him time to move out orderly. That did not mean that he was still on employee of the defendant. In those premises, I find that the Plaintiff has failed to prove his case on the balance of probabilities. Hence the suit is dismissed.

G. M. OKELLO JUD?e.

22/5/^