Zambia Railways Ltd v Mwale and Ors (Appeal 55 of 2000) [2000] ZMSC 156 (7 September 2000)

IN THE SUPREME COURT FOR ZAMBIA HOLDEN AT NDOLA (CIVIL JURISDICTION) BETWEEN: APPEAL NO. 55/2000 ZAMBIA RAILWAYS LIMITED APPELLANT AND ELIYA MW ALE AND 13 OTHERS RESPONDENT Coram: Sakala,Ag. D. C. J., Muzyamba, Lewanika, JJS. On 6th June and 7th September, 2000. For the Appellant: B M. Kang’ombe of Kang’ombe &. Company For the Respondent: H. B. Mbushi of Ndola Chambers. JUDGMENT Lewanika,JS, delivered the Judgment of the court. This is an appeal against the decision of the High Court awarding the respondents interest on their terminal benefits and dismissing the appellant's counterclaim for rental arrears. The facts before the learned trial Judge were not in dispute and they were that the respondents were employed by the appellant which was downsizing its labour force as a result of a restructuring programme. The appellant served notices of retirement on the respondents in January/1994, informing them that their last working day was to be 31st July, 1994 and that their terminal benefits would be paid to them then. Due to financial constraints the appellant was unable to pay the terminal benefits on time and only did so in 1996. In the meantime the appellant allowed the respondents -J2- to stay in the company houses that they occupied rent free till they were paid their terminal benefits. Subsequently the appellant offered to sell the houses to the respondents as sitting tenants following the governments housing empowerment policy. The respondents instituted proceedings against the appellant claiming inter alia interest on their terminal benefits and the appellant counterclaimed for rental arrears during the period that the respondent occupied the houses prior to buying them. The learned trial Judge awarded the respondents' claim for interest and dismissed the appellant's claim for rental arrears, hence this appeal. Counsel for the appellant has filed three grounds of appeal; namely:- 1. That the learned trial Judge erred when he awarded the plaintiffs interest on the terminal benefits. 2. That the learned trial Judge further erred when he dismissed the appellant's counterclaim on unpaid rentals as baseless. 3. That on the totality of the evidence before the learned trial Judge it was wrong for him to have allowed the plaintiffs to occupy the company houses for four years rent free. In arguing the first ground of appeal Counsel for the appellant submitted that the learned trial Judge erred when he found that the respondents had proved their claim for interest without considering the -J3- special circumstances of this case and particularly that the appellant had allowed the respondents free occupation of the company houses without demanding rent. He said that justice would have been better served if the issue of interest was dropped considering that the parties had not initially agreed on the same and the delay in making the payments was not deliberate but due to lack of funds and also considering that the respondents had occupied the company houses for four years without paying rent. Counsel for the appellant argued grounds two and three together. In arguing these grounds Counsel submitted that having regard to the special circumstances of this case, the learned trial Judge erred when he dismissed the appellant's counterclaim for unpaid rentals. That the court below having found for the respondents on the issue of interest, ought in all fairness to have found for the appellant on the issue of the unpaid rentals. That it was a great injustice that the respondents could occupy the company houses for four years rent free and at the same time claim interest and he urged us to allow the appeal. We have considered the arguments advanced by Counsel for the appellant as well as the evidence on record. The respondents were served with notices to retire in January, 1994, informing them that their last working day would be 31s1 July, 1994, and that they would be paid their terminal benefits then. In fact they were not paid till 1996 and having been deprived of their money for that period they were quite clearly entitled to claim interest on it. The learned trial Judge was on firm ground in awarding them interest. -J4- On the appellant's counterclaim for rentals for the period that the respondents occupied the company houses before they were paid their terminal benefits and offered to buy the said houses, the evidence on record is that the appellant allowed the respondents to occupy the houses rent free and only charged them for repairs. There was no agreement for the payment of any rent and it is clear to us from the evidence on record that the issue of rent was only raised by the appellant when the respondents claimed interest on their unpaid terminal benefits. The learned trial Judge was also on firm ground in rejecting the appellant's counterclaim for the payment of rentals. This appeal is totally devoid of merit and we dismiss it with costs, the costs are to be taxed in default of agreement. E. L. SA KAL A AG. DEPUTY CHIEF JUSTICE W. M. MUZYAMBA SUPREME COURT JUDGE D. M. LEWANIKA SUPREME COURT JUDGE