CIVIL APPEAL NO 345 OF 2021 RAMADHAMI MASOUD VS BANK OF AFRICA

IN THE COURT OF APPEAL OF TANZANIA AT PAR ES SALAAM fCORAM: SEHEL. J.A., MASOUP. J.A., And MDEMU, 3.A.) CIVIL APPEAL NO. 345 OF 2021 RAMAPHAN MASOUP ....................... .................. ........................ APPELLANT VERSUS BANK OF AFRICA.............................................................-........ RESPONPENT (Appeal from the judgment and decree of the High Court of Tanzania (Labour Pivision) at Par es Salaam) (Nqunvale, J.1 dated the 1st day of July, 2021 in Labour Revision No. 391 of 2020 JUDGMENT OF THE COURT 7th August & 10th September, 2024 MASOUP, 3.A. Going by the record of appeal before us, the appellant and the respondent were in an employer - employee relationship dating as far back as July, 2007. It started when the appellant was first employed and subsequently confirmed as a Branch Manager. The relationship saw the appellant holding various positions within the respondent's workplace. He thus rose through various ranks to the Head of Legal Documentation and Recovery Executive before being terminated on 7th May, 2019. The reason for his termination was gross negligence involving, firstly, signing of a security checklist document indicating that legal mortgage was in custody although such security was not in the respondent's custody, and secondly, failure to register leasehold on the property in the favour of the respondent. On account of allegations for such misconducts, the appellant was in respect of signing a security checklist as afore said, charged with and found guilty of the disciplinary offence concerning deliberate provision of false/misleading or wrong information or instruction to subordinates contrary to section 5.6 of the Human Resource Manual (hereinafter the HR Manual). In respect of the second count, he was charged with and found guilty of willful negligence in the performance of work. The allegations relating to committing such disciplinary offences were in relation to irregularities in the issuance of loan facility of USD 1,860,000.00 to Lesvos Enterprises Ltd in December, 2017. Prior to the appellant being charged, he was called upon to show cause why disciplinary action should not be taken against him for committing such misconducts contrary to sections 5.6 and 1.5 of the HR Manual. Having submitted his written response to the allegations as required, investigation into the allegations were allegedly conducted before the appellant was eventually subjected to a disciplinary hearing. In the end, the said committee found him guilty of the two disciplinary offences which amounted, in its view, to gross misconduct. Consequently, the appellant was terminated from his employment for such reason. In its findings, the disciplinary committee stated and ordered termination of the appellant thus: "The Committee satisfied itseif beyond doubt that there was gross negligence and in consideration o f sections 1.5 and 5.6 o f the HR Manual on Guiding Schedule for Offences and Permissible Penalties, respectively, the Committee orders termination o f the defendant." As the appellant was dissatisfied with the termination of his employment, he preferred a complaint to the Commission for Mediation and Arbitration (CMA), claiming that his termination was both substantively and procedurally unfair. After hearing the parties, the CMA was satisfied that pursuant to section 37 (1) and (2) of the Employment and Labour Relations Act (ELRA), the respondent had proved that the termination of the appellant's employment was based on valid and fair reason and was in accordance with a fair procedure. It thus dismissed the complaint. It is noteworthy that, in its decision, the CMA also considered the provisions of rules 9(1) (5) and 13 of the Employment and Labour Relations (Code of Good Practice) Rules, 2007 G.N. No. 42 of 2007 (the Code). It was satisfied that the respondent proved that the appellant was fairly terminated. 3 Aggrieved by the CMA's award, the appellant applied for a revision calling upon the High Court to consider two issues, namely, whether the appellant's termination was both procedurally and substantively fair, and what were the reliefs the parties were entitled to. At the end of the day, the High Court affirmed the decision of the CMA. In its determination as afore said, the High Court invoked the provisions of rule 12 (3) (a) and (d) of the Code in support of its findings that the allegations against the appellant amounted to gross misconduct which led to a loss of USD 1,860,000.00 on the part of the respondent. In that respect, the High Court held that the appellant failed to account as to why he signed the checklist whilst the security was not in the respondent's custody and why he also failed to register the leasehold on the property leased for the loan as required. The High Court was also satisfied that the appellant was afforded a right to be heard much as he admitted to have committed the disciplinary offences as charged. It thus dismissed the application for revision. Dissatisfied by the decision of the High Court, the appellant lodged the instant appeal advancing the following grounds: (1) The High Court erred in holding that the respondent had fair reason for terminating the appellant's employment while the decision to terminate was based on an incurably defective charge. (2) That the High Court erred in holding that the respondent had a fair reason for terminating the appellant's employment without resolving the incompleteness, inconsistence and contradictions in the charge laid against the appellant (3) The High Court erred in holding that the respondent had a fair reason for terminating the appellant's employment while knowing that the appellant was terminated for offences, he was not charged with including non-existence offence. (4) The High Court erred in holding that the appellant was adequately heard before termination while knowing that the appellant was not availed an opportunity to see a copy o f investigation report which formed the foundation o f the charge against him. (5) That the High Court erred by applying the rules blindly without determining whether or not termination was the appropriate sanction in the light o f the seriousness o f the misconduct and the circumstances in which it occurred. (6) That the High Court erred for failure to consider weight o f the appellant's case. At the hearing of the appeal, Mr. Mashaka Ngole, learned counsel represented the appellant. On the other hand, Mr. Godwin Nyaisa and Mr. Phillip Irungu, learned counsel, represented the respondent. Both parties adopted their relevant written submissions. They, as well, made oral submissions elaborating on the written submissions. On the 1st, 2nd and 3rd grounds of appeal, the thrust of Mr. Ngole's submission was on the charge with which the allegations levelled against the appellant were preferred. The bottom line of the entire submission on these grounds was in a nutshell that, the charge was defective and did not reflect the offences in respect of which the appellant was found guilty and his employment was terminated. He was of the view that, although such an issue was not raised before, it consists a point of law which may be raised at any time. He relied on Felician Muhandiki v. Managing Director, Barclays Bank Tanzania Ltd (Civil Appeal No. 82 of 2016) [2024] TZCA 61 (20 February 2024; TANZLII). In reply, Mr. Irungu urged the Court to find that the grounds were new. They were neither raised and argued in the CMA nor in the High Court. They were also, according to him, not reflected in the appellant's submissions at the High Court. The grounds, he argued, ought to be dismissed. He placed reliance on Emmanuel Josephat v. Republic (Criminal Appeal No. 323 of 2016) [2018] TZCA 207 (2 October 2018; TANZLII) and Hassan Bundala Swag a v. Republic (Criminal Appeal No. 386 of 2015) [2015] TZCA 261 (23 February 2015; TANZLII). 6 Our scrutiny of the CMA Form No. 1, we established that the appellant's complaint at the CMA was on unfair termination. It was hinged on the ground that he was not issued with a notice of termination, the procedure for fair termination was not followed, and that the reasons for termination were neither proved nor justified. In the course of trial at the CMA, the parties conversed on the issue whether the appellant was charged with the offences in respect of which he was found guilty. This is, in our view, within the scope of the second ground which also relates to the ground of revision at the High Court which seeks to fault the finding of the CMA that the respondent followed proper procedures in terminating the appellant. Thus, in relation to the issue, it was the appellant's argument that gross negligence is neither amongst the offences he was charged with nor was it amongst the offences found in the HR Manual. On the contrary, it is on the record that the respondent's case was that the appellant's argument was baseless because there were no changes of the provisions in respect of which he was charged with and found guilty. It was thus insisted that the appellant was charged with only two offences falling within the purview of section 5.6 and section 1.5 of the HR Manual respectively. In so far as the charge is concerned, we could not, on our part, find on the record any other complaint conversed by the parties reflecting the 1st and 2nd grounds, other than the complaint relating to the 3rd ground. They are to us, therefore, new complaints which were not raised before. Even if they were not, we do not think the complaints are merited for the offences were, clearly, charged under sections 5.6 and 1.5 of the HR Manual, which provisions were never changed and were indeed very well responded to by the appellant. Accordingly, we find that the complaints on the issue whether or not the appellant was found guilty of gross negligence as charged was raised before. We, however, resolve the issue against the appellant for we are satisfied that there is nothing on the record showing that the provisions of the disciplinary offences the appellant was charged with were changed. We are satisfied that the reference to gross negligence was only meant to show that the respondent was entitled to terminate the appellant given the seriousness of the misconduct. Accordingly, 1st, 2nd and 3rd grounds have no substance. We dismiss them. We propose hereunder to deal with the remaining grounds, namely, 4th, 5th and 6th grounds together as in our view they are interrelated. They all revolve on the provisions of rules 9, 12 and 13 of the Code. It was the submission of the appellant's learned counsel in relation to the 4th ground s that the appellant was not afforded a fair hearing before the disciplinary committee. He attributed the alleged failure to the fact that the appellant was not availed of the investigation report which was the basis of his accusations. According to the appellant's counsel, that was contrary to the requirements of the provisions of rule 13 (1) and (5) of the Code which relate to fair hearing. The above provisions, according to the appellant' counsel, require an employer to conduct an investigation on allegations levelled against an employee and ascertain whether there are grounds for a hearing to be held. Further that, when the hearing is held, the employer must present evidence and have her witnesses questioned by the employee. It was in relation to those provisions that the failure was in the instant appeal so serious that it denied the appellant an opportunity to cross-examine a witness of the respondent who could have tendered the report in evidence and testify on it or any other witness who could have presented any other relevant evidence in support of the allegations as none was called at the disciplinary hearing. It was, instead, the appellant who was, according to the appellant's counsel, subjected to a difficulty of being questioned by members of the committee and required to respond to their questions. We were, for such reasons, urged to find merit on the 4th ground and proceed to allow the appeal. It was submitted in respect of the 5th ground that in the rules creating the disciplinary offences the appellant was charged with were blindly applied without determining whether or not the termination was the appropriate sanction in the circumstances. In fortification, the learned counsel invoked the provisions of rules 9 (1) and 12 (1), (2), (3) and (4) of the Code, and argued that factors which must be considered in deciding as such were not taken into account. He submitted that had the above rules been judiciously applied, it would have been found that the termination was not the appropriate sanction. We were on that account invited to find merit on the 5th ground and proceed to allow the appeal. On the 6th ground, the gist of the argument was that the appellant's case was, particularly with reference to the second disciplinary offence, not considered. As a result, the appellant was unfairly terminated from his employment. In reply to the 4th and 5th grounds, the respondent's learned counsel arguments were anchored on the following points: that, the 4th ground was a new complaint which was neither raised by the appellant at the disciplinary committee nor at the CMA; it was only highlighted at the High Court and could as such not be determined since it was not raised and determined by the CMA; that, the two grounds are irrelevant because the appellant admitted to have committed the disciplinary offences he was charged with 10 and thus termination was the appropriate sanction; and since the appellant admitted to have committed the offences as charged, the respondent was entitled to dispense with the requirements of conducting a disciplinary hearing in terms of the provision of rule 13(11) of the Code. The respondent's counsel argument in reply in relation to the 6th ground was based on the job description of the appellant as the Head of Legal Documentation. He submitted that the duty to register leasehold was within his responsibilities as the Head of Legal Documentation regardless of the fact that the respondent had outsourced a firm of advocate for the task. It was in the end argued that the appellant cannot escape liability for committing the disciplinary offences which exposed the respondent to a loss of USD 1,860,000.00. When probed on the outcome of the disciplinary hearing, Mr. Irungu was of the position that despite the way it was crafted, it was a mere recommendation to the respondent. It had therefore nothing negative on the impartiality of the respondent's disciplinary committee. In his brief rejoinder, Mr. Ngole reiterated his submissions in chief and refuted the assertion that the appellant admitted committing the offences. On the outcome of the disciplinary hearing, the learned counsel contended that the reading of the hearing form shows that the committee ordered ii termination of the appellant's employment on gross negligence instead of making a recommendation to the respondent. Such course, Mr. Ngole submitted, spoiled the impartiality of the committee. The crux of the rival submissions on the 4th, 5th, and 6th grounds which remain to be resolved is on whether the respondent in terminating the appellant was properly guided by the relevant provisions of the Code which provide for fair procedures for termination for misconduct. Incidental to the above issue is the question whether the appellant admitted to have committed the disciplinary offences he was charged with as alleged by the respondent. The latter is at the heart of the arguments in reply in the remaining grounds and was indeed, the concurrent findings of facts by the High Court and the CMA. Since the present matter relates to termination due to misconducts, the relevant provisions of the Code are rules 8, 9, 12 and 13. This Court has had an opportunity in the cases of National Microftnance Bank v. Victor Modest Banda (Civil Appeal No. 29 of 2018) [2020] 7ZCA 35 (26 February 2020; TANZLII); National Microfinance Bank v, Leila Mringo and Others (Civil Appeal No. 30 of 2018) [2020] T7CA 240 (20 May 2020; TANZLII); and Severo Mutegeki and Another v. Mamlaka ya Maji Safi na Usafi wa Mazingira Mjini Dodoma (DUWASA) (Civil Appeal No. 343 of 2019) [2020] TZCA 310 (19 June 2020; TANZLII) to consider the 12 provisions of the above Code in relation to the duty of an employer to comply with fair procedures for terminating an employee for misconducts. We stand guided by the settled position of the law emerging from the above cases whilst mindful of section 57 of the Labour Institutions Act, Act [Cap. 300 R.E. 2019] as interpreted by this Court in, among others, the case of CGM Tanzania Ltd v. Justine Baruti, Civil Appeal No. 23 of 2020 (Civil Appeal No.23 of 2020) [2021] TZCA 256 (15 June 2021; TANZLII). In those cases, the Court was of the settled view that for an employer to prove that termination was fair, she must, under rules 12 and 13 of the Code and in terms of section 39 of the ELRA, prove that; one, the employee committed a serious misconduct; two, the procedure for fair termination under the Code was complied with and; three, the sanction imposed was justified and has consistently been applied to other employees who committed the same misconduct. In Severo Mutegeki and Another (supra), we particularly emphasised that, what constitutes a fair termination is, by and large, regulated by rule 13 of the Code which prescribes criteria and procedures regulating lawful termination. According to that case, the provisions of rule 13 of the Code underpin the duty to act judicially in accordance with the rules of natural justice before an adverse action or decision is taken against an employee facing allegations of misconduct. 13 In Leila Mringo and Others (supra), while noting that there was on the record admission by the employees that they occasioned loss to their employer, this Court did not find it correct to find that the issue of dishonesty and deceit had been proved through such admission. It took it that what the employees admitted is occasioning loss and not to dishonesty or deceitful conduct. It further observed that since there was no evidence that the employees occasioned loss with malafide intent, dishonesty and deceit were not proved. With the above position of the law in mind, it is on the record of appeal that the appellant was charged with two offences of misconducts. He was found guilty of the two offences and was accordingly terminated from employment for gross misconduct. It was concurrently found by the CMA and the High Court that the appellant, in respect of the first offence, had admitted to have signed a security checklist document indicating that legal mortgage was in custody although such security was not in the respondent's custody; and, in respect of the second offence, had also admitted to have not registered leasehold on the property leased to Lesvos Enterprise Ltd. Thus, the appellant was for such reason found guilty of the first offence of deliberate provision of false/misleading or wrong information or instructing a subordinate to give such information contrary to section 5.6 of the respondent's HR Manual and also found guilty of the second offence of 14 willful negligence in the performance of work contrary to section 1.5 of the HR Manual. In this respect, the High Court based on the evidence in the cross-examination to establish the alleged admission by the appellant. The same were in respect of signing the checklist and not registering the leasehold. However, in our scrutiny of the substance of the written response by the appellant when called upon to show cause, his responses at the disciplinary hearing, his cross-examination to the respondents witnesses and his testimony in defence, we do not, with respect, think it was correct to find that the offences had been proved based on the alleged admission by the appellant. We say so because the appellant essentially agreed to have signed the checklist and to have not registered the leasehold, but not to have done so deliberately and willfully. In the absence of clear evidence of deliberate or willful intention, it cannot be said that the charge laid against the appellant had been proved by the respondent. We are, in that regard, mindful that the burden of proof was on the respondent. We think that the High Court erred in confining itself to the position maintained by the respondent without closely looking at the substance of the response and defence given by the appellant against the allegations and without resolving the issue as to the absence of proof of wrong doing which 15 was clearly raised by the appellant. As such, the concurrent finding by the CMA and the High Court was not based on the record as afore shown. With respect, we disagree with the respondent's counsel argument that there was, in the circumstances, admission by the appellant to the allegations which entitled the respondent under the provision of rule 13 (11) of the Code to dispense with the requirements of the guidelines. After all, we were neither shown nor did we find anything on the record of appeal suggesting that there was the consent of the appellant to the action taken to warrant the respondent not convening the hearing pursuant to rule 13 (5) of the said Code. Needless to say, we could not, from the record, find anything amounting to exceptional circumstances brought up by the respondent during the disciplinary hearing to warrant the scheduled hearing not to be conducted as provided under the said rule. That said, the argument that there was admission raised by the respondent in 4th, 5th and 6th grounds is without merit and we reject it for reasons shown. Having disposed of the issue as to whether or not the appellant admitted to the charge laid against him, the remaining issue relating to the 4th ground is about whether the appellant was not afforded a fair hearing by virtue of not being availed the investigation report in terms of rule 13 (1) and (6) of the Code. This issue relates to fairness of termination raised by the appellant in the CMA FORM No.l, which, in terms of section 39 of the 16 ELRA, is within the respondent's obligation to prove even if it was not raised by the appellant. On this stance, see for instance, Leila Mringo and Others (supra). We thus find the argument that the issue had not before been raised meritless. We, accordingly, reject that argument. Since we have already rejected the argument that there was admission to the allegations warranting applying rule 13(11), it would follow that the respondent, having summoned the appellant under rule 13 (2) and (3) of the Code for the disciplinary hearing, was obliged to comply with fair procedures in the hearing that led to his termination in terms of, among others, the provisions of rules 12 and 13 of the Code. It was, therefore, incumbent upon the respondent to comply with rule 13 (5) of the Code which required the respondent to present evidence supporting the allegations against the appellant at the hearing by calling witnesses. The provision also required that the appellant be given a proper opportunity to respond to the allegations and to cross-examine any witnesses called by the respondent after hearing the evidence presented in support of the allegations. It is no wonder that such evidence would have been contained in the investigation report which was the basis of preferring the charge against the appellant in terms of rule 13 (1) of the Code. It was the argument of the appellant's counsel that the investigation report was neither availed to him in evidence nor was there any witness 17 called to present it or to present any other evidence against the appellant in support of the allegations constituting the two offences as charged. It was not shown in the reply by the respondent's counsel that there was any witness who was called to establish the allegations. The counsel only relied on the alleged admission which we have herein above rejected. When we probed further on the compliance with rule 13 (5) of the Code, Mr. Irungu asserted that the respondent presented evidence at the disciplinary hearing. Having gone through the record of appeal before us, we find that the provisions of rule 11 (1) and (5) of the Code were not complied with. We say so because the contents of the hearing form (exhibit B4), which was tendered at the CMA by Mjabwa Ramadhani Hanzuruni (DW1), the chairman of the disciplinary committee, to prove the fairness of the termination, do not exhibit compliance with the provisions requiring presenting evidence in support of the allegations against the appellant and availing opportunity to the appellant to cross-examine any witness called. A critical look at the hearing form that consisted of the disciplinary hearing proceedings left us in no doubt that no evidence supporting the allegations was, as argued by Mr. Ngole, presented at the disciplinary hearing. The hearing form only consisted of; one, the particulars of the allegations which were read over by Rose Mbonea (DW2) who doubled as the investigator of the allegations and the prosecutor at the disciplinary 18 hearing; two, the response given by the appellant when the allegations were read over to him by DW2; three, the questions that were put to the appellant by members of the disciplinary committee without first according him opportunity to hear and appraise the respondent's evidence; four, the responses that the appellant gave to the questions that were put to him by the members of the disciplinary committee; and five, listed documents at the end of the hearing form which were not founded on any evidence presented as none was called as a witness to present evidence supporting the allegations. As there was no witness that was called by the respondent, there is throughout the hearing form nothing in the nature of evidence presented by the respondent as is apparent in the section of the form reserved for that purpose. On the other hand, the section of the hearing form reserved for the finding of the disciplinary committee based on the presented evidence had nothing other than a mere recommendation by the prosecutor (DW2) that the appellant be given a strong warning. The said recommendation was not based on any evidence on the record. The recommendation was thereafter followed by an order by the committee for termination on gross negligence which in our view dented the impartiality of the Committee, for its mandate was to recommend and not to order termination. 19 The evidence of the respondent adduced at the CMA by DW1, DW2, and one, Mercy Fanuel Msuya, a secretary to the disciplinary hearing committee (DW3) is equally clear that there was no evidence which was presented at the disciplinary hearing. We wonder as to where exactly such witnesses who presided over the impartial tribunal got such evidence as the same was not founded on the disciplinary hearing conducted. The finding by the High Court that the appellant was afforded a fair hearing prior to being terminated for gross negligence is, with respect, wanting in view of the above deliberations. In as much as it is not supported by the record, it justifies the intervention of this Court on account of misapprehension of the evidence and violation of the law. We say so because, it is evident in the hearing form that the appellant was not afforded a fair hearing before being terminated for gross negligence. Clearly, he was neither availed of the evidence of the respondent on the charge laid against him nor afforded an opportunity to cross-examine any witnesses on the evidence supporting the charge which the respondent had in her disposal as none was called to present the evidence. We are therefore satisfied that the disciplinary hearing was conducted in violation of rules 13 (1) and (5) of the Code among others. Consequently, the failure by the respondent to comply with rule 13 (5) of the Code means that, with respect to the two disciplinary offences the 20 appellant was charged with, there was no evidence proving the mental elements of "deliberate" and "willful" that respectively underline the two offences as was correctly argued in vain by the appellant's counsel at the High Court and the CMA. As such, the proof of such mental elements by the respondent on the balance of probabilities, should have been found by the High Court to be wanting. In view of what we have already deliberated upon which serves to dispose of the 4th ground of appeal in the favour of the appellant, we are settled that there was no evidence adduced by the employer on the record to justify the finding that the appellant contravened sections 5.6 and 1.5 of the HR Manual as charged. Besides the above findings, pursuant to rule 12(4) of the Code, the respondent had a duty to ascertain whether the termination as a sanction which she was minded to impose, was appropriate. This duty was in the case at hand not discharged before termination was held to be the appropriate sanction. Neither the High Court nor the CMA aligned itself with what should have been done in terms of the provisions of rule 12 (2), (3), (4) and (5) of the Code before the termination was adjudged as the appropriate sanction. The 5th ground is as a result resolved in the appellant's favour. We have given special regard to the rival arguments that the appellant's defence was not considered, and in so doing, we took into 21 account our earlier deliberations. Given the circumstances in which the alleged misconducts occurred as intimated by the appellant in the record of hearing at the disciplinary hearing, and at the CMA, we think there is a scope in agreeing with the appellant as we hereby do so that his evidence was indeed not given the attention it deserved. In this respect, we have had regard to the fact that there was, as already shown, a total failure of the respondent to present evidence in support of the allegations before the disciplinary hearing committee. This serves to dispose of the 6th ground in the favour of the appellant. It is common ground that it is the duty of the respondent to prove that the termination of the appellant was fair procedurally and substantively. Since we have found that the respondent did not present evidence at the disciplinary hearing to prove the allegations levelled against the appellant and did not follow the procedure for fair termination, we find that the termination was unfair both procedurally and substantively. We say so because the procedure was not adhered to and as a result, the reason for termination was not established. For the reasons stated herein above, we allow the appeal. In consequences thereof, we quash the decision and award of the High Court and CMA respectively which found that the appellant was fairly terminated both procedurally and substantively. In substitution therefor, we declare that 22 the appellant was unfairly terminated as there was no valid reason for termination and the procedure was not followed. In that respect, we order the respondent to pay compensation to the appellant of thirty-six months' salaries as provided for under section 40 (1) (c) and (2) of the ELRA since we do not, in the circumstances, find restatement and re-engagement to be feasible options; and one month salary in lieu of notice. Our determination has had particular regard to the reliefs that the appellant sought in his CMA FORM No. 1. Since this is a labour matter, we make no order as to costs. DATED at DAR ES SALAAM this 4th day of September, 2024. B. M. A. SEHEL JUSTICE OF APPEAL B. S. MASOUD JUSTICE OF APPEAL G. J. MDEMU JUSTICE OF APPEAL The Judgment delivered this 10th day of September, 2024 in the presence of Mr. Mashaka Ngole, learned counsel for the Appellant and Mr. Philip Irungu, learned counsel for the respondent, is hereby certified as a true copy of the original.