Nkonjera v Chilanga Cement PLC (Appeal 33 of 2007) [2010] ZMSC 14 (21 September 2010)

JI IN THE SUPREME COURT OF ZAMBIA HOLDEN AT NDOLA (Civil Jurisdiction) B ETW E E N: VIOLET NKWANJIWA NKONJERA (As Administrator of the estate of the late VERNON NKONJERA) AND OTHERS AND CHILANGA CEMENT PLC RESPONDENT CORAM: Sakala, Cl, Silomba and Chibomba, JJS On 1st December, 2009 and 21st September, 2010 For the Appellants: For the Respondents: Mr. V. K. Mwewa of V. K. Mwewa and Company Mr. N. Nchito and Ms. M. Malama of MNB Legal Practitioners JUDGMENT SILOMBA, JS, delivered the judgment of the Court. Cases referred to:- 1. James Mankwa Zulu and Others -Vs- Chilanga Cement PLC. 2. ZCCM -Vs- Jackson Munyika and Others. 3. Edward Mweshi Chileshe -Vs- ZCCM. 4. Zulu -Vs- Avondale Housing Project. The Appellants in this appeal are appealing against the judgment of the Industrial Relations Court dated the 9th of August, 2005 in which the lower Court declined to make a declaration to the effect that they were entitled to purchase the houses they were occupying as sitting tenants. J2 The brief background to this appeal is that there were actions which were filed in the Industrial Relations Court. Because the actions had identical claims against the Respondent, it was, by the consent of the parties, agreed to consolidate the various actions to be tried as one. The main issue in the various claims was the sell of houses to employees of the Respondent. The evidence in support of the Appellants' claim was adduced by two witnesses. The evidence of Bernard Mukuka (CW1) was that on the 31st of August, 2002 he was retired by the Respondent as a Mechanical Engineer - Supervisor. At the time he retired, he was also chairman of the Staff Association at Ndola Works of the Respondent and was part of management. The Staff Association was established to facilitate communication between the staff and the management and vice versa. His complaint before the trial Court was against the manner in which the Respondent Company conducted itself in disposing of the housing stock to serving employees and sitting tenants, which he termed discriminatory, unfair and a breach of contract. He recalled that around 1997-1998, there was a Presidential directive on housing empowerment, which applied to the Respondent Company. According to the witness, the Respondent did not act on the Presidential decree and despite the several reminders the company still remained adamant. On a day he could not remember, the Respondent issued a notice to employees to the effect that the houses they were occupying were to be valued; employees were requested to cooperate with the valuators during the exercise. Thereafter, the houses were valued and their prices fixed and there was an interim statement from the Respondent that it had agreed in principle to sell some of its housing units. The interim statement was followed by a memorandum J3 on who was eligible to buy the houses and the mode of payment. The houses were to be disposed of in three tranches or stages with effect from July, 2000. The first to be covered were former or retrenched employees, followed by workers at Chilanga Works in Lusaka and lastly to be covered were existing employees. According to the witness, the former employees under stage one were given offers but not all of them were covered and so they made representations on the selective approach to the issue. When the Respondent Company was sold to La Farge, the current owners, the representative of the workers, four in all, from Ndola and Chilanga Works, met the chairman of the board of directors to find out why it was taking long to sell the houses to employees. At that meeting, the representatives were assured that the decision to sell the houses would not be rescinded. Despite the assurance, the new owners of the Respondent issued another memorandum in which the sale of company houses to employees was halted in the interest of employees and the company. With the announcement, the expectations of employees were ruined, hence the commencement of the action in the Court below. He prayed for an order to allow them to purchase the houses they occupy. As far as he was concerned, the first memorandum of July, 2000 gave them the right to buy the houses, which could not be taken away by a subsequent circular. In cross-examination, the evidence of Mukuka was that on being privatized the Government ceased to be the owner of the Respondent Company. The evidence in chief of the second witness Kenny Nswana (CW2), former Acting Works Personnel Manager of the Respondent, was that while in J4 employment his job involved the interpretation of company notices, implementation of company policies, in-charge of industrial relations and Secretary of the buying committee for both Lusaka and Ndola Works. The evidence of Nswana was that sometime in November, 2001 he was approached by senior managers at Ndola Works who wanted to know when they would buy houses before they resigned due to bad conditions of service. He immediately phoned the Human Resource Manager at headquarters in Lusaka and briefed him on the meeting he had with senior managers. At the time of the meeting, the programme on the sale of houses was on but in December, 2000, Nswana received correspondence that halted the sale of houses. As far as Nswana was concerned, the cancellation of sale of houses was not retrospective in effect as it only affected future employees. He came to the foregoing conclusion in view of the instruction to retain 50% of the terminal benefits of a retired employee to go towards the purchase of the house. When Nswana was cross-examined, his evidence was that when he was employed in February, 2000 he found the problem on the sale of houses to employees still there. When Nswana was referred to Clause 17 of the Staff Handbook, he said he was not aware of the retention of 50% of the benefits of a retired employee who had not vacated the Respondent's house. At the close of the Appellants' case, the Respondent called only one witness to rebut the evidence adduced by the Appellants. The evidence in chief of Fredrick Mpangala, the Human Resource Manager, was that in 2001 La Farge bought the Respondent Company from the Commonwealth Development Corporation (CDC). His evidence was that from the time he joined the Respondent in 1998 the issue of employees, wanting to buy houses was always J5 there. The Respondent position was, according to the witness, that it could not sell the houses because it was part of the employment benefits for existing and future employees. As a result of persistent inquiries, the board of the Respondent agreed in principle to sell some of the houses both at Chilanga and at Ndola. Mpangala's testimony was that after a year the decision was reviewed because it was not consistent with the policy of the company to provide accommodation to its employees; that the sale of houses was accordingly discontinued after a few houses were sold to employees. According to the witness, the houses at Chilanga were near the cement factory and because the factory operated 24 hours a day it was convenient for workers to walk to and from the factory. Besides, it was his evidence that the provision of accommodation to workers saved the company from paying huge amounts in housing allowances to both unionized and non unionized employees. As for Ndola Works, Mpangala's evidence was that the workers were concentrated in special residential areas, such as Ndeke Township, where it was easy to provide transport to and from work as well as security. When he was cross-examined, Mpangala testified, in response to the question that the Appellants were in Court because they were discriminated in the sale of the houses, that there was no discrimination as alleged. He, however, conceded that some employees were sold houses before the scheme was halted. He also conceded that some employees had 50% of their benefits retained while others not. He testified that the decision to sell houses was taken under the corporate management of the CDC and that it was later abandoned when La Farge took over the Respondent. However, by the time the sales were halted some eighty houses had been sold to employees at the Ndola Works. J6 The foregoing evidence from both sides was evaluated by the trial Court to establish whether or not the claim made by the Appellants could be substantiated on a balance of probabilities. From the evidence, the trial Court found that when the decision to sell houses was made and before it was cancelled some employees received offers and entered into contracts to buy houses from the Respondent. The question the trial Court posed was whether or not the Appellants were disadvantaged in any way on account of social status as a result of the sale of houses to some employees. The trial Court noted that there were no offers produced by any of the Appellants in order for the Court to come to the conclusion that there was an element of discrimination exercised against them. In consequence thereof, the trial Court declined to make a declaration to the effect that the Respondents should dispose of its houses to the Appellants. The appeal to this Court was argued on two grounds of appeal advanced by the Appellants. The first one was: The Honourable Court below erred in law and fact when it held that the Appellants were not discriminated against in relation to the exercise relating to the sale of the Respondent's houses. The second one was: The Honourable Court below erred in law and fact when it held that it could not issue a declaration in favour of the Appellants to compel the Respondent to sell its houses to the Appellants. In support of and in opposition to the grounds of appeal, both the Appellants and the Respondent filed written heads of argument, which their respective counsel reinforced with oral submissions. After referring to a portion of the evidence and the reasoning in the judgment of the trial Court, which showed that some employees were sold J7 houses while others were not, the Appellants submitted, under ground one, that the real issue was whether there was anything in law or equity which bound the Respondent to sell houses to the Appellants in the form of a contract or otherwise. The Appellants acknowledged that the trial Court accepted the Respondent's argument that there was nothing wrong in embarking on the sale of houses and later halting the sale and that the decision to stop the sale was made by La Farge, which bought the shareholding of the Respondent as a going concern. In view of the foregoing, the Appellants contended that upon taking over the Respondent the new board of La Farge should have ensured that the decision they took was made within the confines of the law and in line with previous management, especially that the decision related to workers' rights. It was argued that the decision to sell the houses was made in 1999 and the new board of La Farge could not just come in and stop the sale as if the earlier board did not consider various issues before deciding to sell the houses to the Appellants and other affected workers. Going by the mandate given to the trial Court to do substantial justice, the Appellants submitted that it was incumbent upon the Industrial Relations Court to consider all the circumstances and the fact that the decision to sell houses in an on going exercise involved all categories of workers, retrenchees and retirees; that it was, therefore, unfair, disadvantageous and discriminatory that the exercise had to be discontinued after more than five hundred workers had purchased the housing units (evidence on record shows only 80 bought houses). With regard to the case of James Mankwa Zulu and Others -l/s- Chilanga Cement PLC,(1) the Appellants contended that the case was similar to their case as J8 it involved employees of the same class as the Appellants; that in that case the Supreme Court found that the denial of offer of the houses to the Appellants was meant to punish them for taking Court action and further found that the Appellant's claim was founded in the principle that similarly circumstanced employees ought to be similarly treated unless there was a valid reason justifying different treatment. Coming to the case at hand, the Appellants submitted that their circumstances were not different from those of other employees, retirees and retrenchees who were allowed to.buy the Respondent's houses. The Appellants placed full reliance on the provisions of Section 85(6) of the Industrial and Labour Act which stipulates that an award, declaration, decision or judgment of the Court (IRC) on any matter referred to it for its decision shall be binding on the parties to the matter and on any parties affected unless the matter is the subject of an appeal under Section 97 of the same Act. The Appellants noted that they were not parties to the case of ZCCM -Vs- Jackson Munyika and Others (2) in which the Supreme Court said that only orders made by the Industrial Relations Court had binding effect on the parties to the action and any other party who was affected by that order. They, however, contended that the categories of the employees involved were the same, the employer was the same, the houses in issue were the same and the decision made to suspend the sale of the houses disadvantaged them in the same way. As far as they were concerned, the decision in the James Mankwa Zulu case was binding on the Appellants and any other affected employees who should, therefore, benefit from the sale of houses. With regard to ground two, the Appellants submitted that the trial Court had powers to order and compel the Respondent to sell the houses to the J9 Appellants notwithstanding that the Respondent made a corporate decision. The James Mankwa Zulu (1) case was relied on in which the Respondent in this case was a party and involved its employees, retrenchees and retirees as well and whose circumstances were not different from that of the Appellants in this appeal. In his oral submission, counsel for the Appellants repeated what was contained in the written hands of argument by way of emphasis. We feel that there is no need of summarizing what was submitted to avoid repetition. From the written heads of argument in response, the Respondent submitted, under ground one that the trial Court firmly decided that the Appellants were not discriminated against in relation to the sale of the Respondent's houses. The Respondent, like the Appellants, alluded to the background of the case to show why the Appellants alleged discrimination in the sale of houses. It was submitted, in view of the provisions of Section 108(1) of the Industrial and Labour Relations Act, that the trial Court was reluctant to find that the Appellants had been discriminated against and disadvantaged in the sale of houses on account of social status as the only evidence before it that touched on the matter was that some people had been sold houses. Going by the decision in the case of Edward Mweshi Chileshe -Vs- ZCCM,(3) the Respondent submitted that Courts would not accept allegations of discrimination to be conclusive merely because parties had been treated differently. The Respondent submitted (per Zulu -Vs- Avondale Housing Project (4)) that the burden of proving discrimination lay on a party that alleged it and that it was the duty of that party to discharge it to the requisite standard, that is to say, on a balance of probabilities. J10 Coming to the case at hand, it was submitted that since the people who were sold the houses had offers from the Respondent and the Appellants had none the trial Court was entitled to conclude that they (the Appellants) had not sufficiently established that they had been discriminated against. With reference to the recently decided case of James Mankwa Zulu and Others (1) (supra), the Respondent expressed the view that it was distinguishable from the present case in that there was evidence of discrimination adduced by the Appellants in the James Mankwa Zulu and Others (1) case; that the Appellants in the James Mankwa Zulu and Others (1) case established that the Respondent (the same as the Respondent herein) had undertaken to offer housing units in which they were sitting tenants if they withdrew an action from Court. Consequently, one of their numbers, Special Bwalya, withdrew from the Court case and was offered to purchase the house in which he was a sitting tenant. The Respondent conceded that the Courts, both at trial and on appeal, rightly found the existence of differential treatment between the parties that was unjustified and, therefore, deserved to be frowned upon. On ground two, the Respondent submitted that the trial Court was on firm ground when it refused to grant a declaration ordering the Respondent to dispose of its houses to the Appellants as there was no proof that the Appellants had been discriminated against in the sale of houses. Further, that there was no evidence to show that the Appellants had been offered to buy the houses and had accepted the offers for the Court to compel the Respondent to sale the houses to the Appellants. As far as the Respondent was concerned, there was no contract of sale between the parties. As for the equitable relief, if any, it was submitted Jll that the Respondent would have been specifically compelled to sale its housing units to the Appellants if there was a contract already in existence which the Respondent had defaulted in its performance, which was not the case in the present case. In his oral submission., counsel for the Respondent, reiterated what was contained in the written heads of argument and as such we shall not summarize the oral arguments as doing so would amount to repetition. We have carefully considered the evidence, the judgment of the lower Court and the written and oral arguments presented before us, including the cases that have been cited to us. The issue of whether the Appellants were discriminated against in the sale of the Respondent's housing units has been well articulated, especially by the Respondent in its written submission. As we have said before, it is incumbent on a party alleging discrimination to show that the treatment given to him was less favourable than the treatment given to another person who was similarly circumstanced as him. The only evidence adduced by the Appellants at trial and upon which the trial Court found that there was no discrimination proved was the evidence that 'ome employees had been sold houses; these were people who had been given offers which were accepted and the sales effected before the sales were halted. This being the situation, the Appellants cannot claim and succeed that they were similarly circumstanced with people who had been given offers and had accepted them. Surely, the people who were given offers and had accepted them belonged to their own class and had attained a legal position whereby the Respondent was contractually bound to honour the contracts. This was not the position with the Appellants. J12 The case of James Mankwa Zulu (1) cannot be relied upon by the Appellants, as it introduces a very different element of treatment which this Court construed to be discriminatory. Employers cannot be allowed to treat one employee favourably because he has obeyed an instruction to withdraw from a Court case while treat those who have exercised their constitutional right to seek redress in a Court of law less favourably and argue that that was not discrimination. Clearly, ground one has no merit and it is accordingly dismissed. In dealing with ground two, we note that it is not independent of ground one. Our finding in ground one that the Appellants had failed to prove that they were discriminated against in the sale of the Respondents housing units must have had a bearing on the learned trial Judge's refusal to grant a declaratory order that the Appellants were entitled to the right to buy the houses. We all know that a declaration is the decision of the Court or Judge on a question of law or rights and is made at the discretion of the Court to assert the right of a party to an entitlement. The declaration is made on justifiable grounds, which means that the party seeking a declaration must lay enough ground to persuade the Court into making a declaratory order. This was not the case in this appeal. As soon as the Appellants failed to prove discrimination, there was nothing left either in law or in equity on which the Court could act to assert their right to purchase the houses of the Respondent. Ground two has no merit either and it is dismissed. J13 In the circumstances, the whole appeal is dismissed with costs to the Respondent to be taxed in default of agreement. E. L. Sakala, CHIEF JUSTICE S. S. Silomba, SUPREME COURT JUDGE H. Chibomba, SUPREME COURT JUDGE