[2001] UGCA 50

# THE REPUBLIC OF UGANDA IN THE COURT OF APPEAL OF UGANDA **AT KAMPALA**

#### HON. JUSTICE . G. M. OKELLO. JA CORAM: HON. JUSTICE . A. E. N. MPAGI-BAHIGEINE, JA HON. JUSTICE . A. TWINOMUJUNI. JA

### CIVIL APPEAL NO. 17 OF 2000 **BETWEEN**

JET SPEED AIR SERVICES (U) LTD. ::::::::::::::::::::::::::::::::::::

#### AND

JOAN TUMUHAIRWE ::::::::::::::::::::::::::::::::::::

(Appeal from the decision of the High Court (Tinvinondi, J) Dated $11 - 2 - 2000$ in HCCS No. 1045 of 1999)

#### JUDGEMENT OF . G. . M. OKELLO, JA

This appeal arose from the decision of the High Court (Tinvinondi, J) dated $11 - 2 - 2000$ in High Court Civil Suit No. 1045 of 1999 whereby judgment was entered against the appellant for breach of contract.

The background facts which led to this case, as found by the trial court, are as the respondent was by a letter dated $7 - 5 - 97$ , employed by the follows: appellant as a Custom Clearing Assistant effective from that date. The letter of appointment. Exh. P1. spelt out the schedule of work attached to that post but did not give the salary scale attached to it. It would appear that in a private and

confidential letter dated $29 - 7 - 1997$ addressed to the respondent, the appellant's managing director, set out her payment package. The original copy of that letter was latter taken away from the respondent by the appellant's managing director allegedly to assist him process the company's 1999 licence for Clearing and Forwarding from Uganda Revenue Authority. On $7 - 1 - 98$ , the respondent was given copy of "**Staff Guidelines**". Exh. P2 which stipulates, the terms of employment with the appellant. Curiously, all this time, the respondent had not been paid her package but had on several occasions been asked by the appellant's managing director to be patient. He also never returned to her the original copy of the confidential letter despite her several demands for it. On $8 - 10 - 98$ he terminated the respondent's services without notice. The respondent accordingly instituted the head suit claiming special and general damages for wrongful dismissal. The High Court heard the suit. In the course of the hearing, the confidential letter which set out the respondent's payment package was not received in evidence because it was a photocopy. However, judgment was entered in favour of the respondent. Hence this appeal.

There were five grounds of appeal but grounds 1 and 2 were abandoned. Only the following grounds were argued. namely:-

(3) the learned trial judge erred in law to hold that the respondent's dismissal was wrongful because:-

(a) the appellant did not give reasons for the dismissal, (b) Exhibit 'P2' offended the rules of natural justice,

(4) the learned trial judge erred in law to have awarded special damages

to the respondent and in particular –

- (a) when the damages were not proved as required by law. - (b) by shifting the burden of proof of those damages to the appellant, - (c) by implying a term in the contract as to remuneration without justification, - (5) the learned trial judge erred in law to have awarded general damages

to the respondent.

On ground 3 (a) Mr. Tibesigwa, learned counsel for the appellant, criticised the trial judge for finding that the respondent's dismissal by the appellant was wrongful on the ground that no reason was given for it. Counsel contended that failure of the appellant to give reason for the respondent's dismissal could not render the dismissal wrongful because the relation between the appellant and the respondent was purely that of master and servant which did not oblige a master to give reason for dismissing his servant. He relied on **Ridge vs Baldwin and** Others (1963) ALLER 66 and 71.

On the other hand. Mr. Musisi of M. S. Muwanguzi. Ziwa and Musisi Advocates. who represented the respondent, submitted that if a master dismisses his servant in the manner not warranted by the contract, then the dismissal will be wrongful and he would pay damages. He pointed out that in the instant case, the appellant actually gave reasons for the dismissal of the respondent. The reasons given were

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that the respondent was found unfit. possessed no experience and was reporting late for duty. Counsel submitted that the trial judge. however, found that these reasons were not substantiated and held that the dismissal was wrongful. The trial judge while dealing with the issue in his judgment stated:

## "This Court therefore was not given the defendant's reason for dismissing the plaintiff. I so find and hold. That being the case, the dismissal was wrongful".

It is clear from the above passage, that the trial judge found that the respondent's dismissal by the appellant was wrongful because the appellant did not give reason for it. In an attempt to elaborate on what he meant, the learned trial judge said:

"True to the defendant's tradition built from the "Guidelines". PW 1 did not prove to the court how the plaintiff was found unfit, on what occasions she was late for duty and what experience was required of her but was found wanting. Above all DW 1 was not aware about any warning given to the plaintiff and whether or not she was required to defend herself but failed to do so".

What is discernible from the above passage is the reason of the learned trial judge for finding that the appellant gave no reason for dismissing the respondent. In his view, whatever reasons the appellant gave were not proved.

The law regarding master and servant was stated in **Ridge and Baldwin and** Others (supra) as follows:-

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"The law regarding master and servant is not in doubt. There cannot be specific performance of a contract of service and the master can terminate the contract with his servant at any time for any reason or for none. But if he does so in a manner not warranted by the contract, he must pay damages for breach of contract. So the question in a pure case of master and servant does not at all depend on whether the master has heard the servant in his own defence; it depends on whether the facts emerging at the trial proves breach of contract".

I respectfully agree with the above statement of the law. The wrongfulness of termination of a contract of employment depends on whether the evidence that emerge at the trial reveal breach of the contract. It does not depend on whether the servant has been heard in his defence or not. In the instant case, whether the appellant gave reasons for dismissing the respondent or not, or whether he heard the respondent in his defence or not is not important. What matters is whether the evidence that emerged at the trial show breach of contract. The "Guidelines" Exh. P2 provides for causes of termination of appointment with the appellant and the corresponding notices as follows -

### $-1$ TERMINATION OF APPOINTMENT In termination of appointment, notice may be given to an employee in accordance with the following:-

| <b>Cause of Termination</b> | | <b>Notice</b> | | |-----------------------------|-------------------------------------------|--------------------------------------------------------------------------------------------------|--| | | (a) Dismissing for misconduct | | | | | (b) <b>Termination of junior staff </b> | | | | | (c) <b>Termination of senior staff</b> | | | | | (d) Compulsory retirement in the | | | | | interest of the company | $\cdots \cdots \cdots \cdots \cdots \cdots \cdots \cdots \cdots \cdots \cdots \cdots \cdots \cd$ | | | | (e) Temporary employee | $\cdots \cdots \cdots \cdots \cdots \cdots \cdots \cdots \cdots \cdots \cdots 30 days$ | | | | <b>(f) Voluntary termination (senior)</b> | | | | | (g) Voluntary termination (junior | | |

The Guidelines also provides for payment of 30 or 60 days salary in lieu of notice at the discretion of the appellant.

The letter of termination of the contract between the appellant and the respondent was not received in evidence on ground of technicality. However, DW 1's testimony revealed that the cause for the termination was misconduct. He explained that the respondent lacked the required experience for the job and was always reporting late for duty. Under the Guidelines (supra), termination for The trial judge found that misconduct was not misconduct attracts no notice. proved against the respondent.

I agree. Having given the reason for the termination, the appellant must establish it to be in accordance with the contract. In this case, he did not. In the first place, lack of the required experience for the job. even if it were proved, does not constitute misconduct. It may affect the employee's proficiency or competence but certainly is not a misconduct. Misconduct connotes intentional bad behaviour. Late reporting for duty would be a bad behaviour but it has not been established. Therefore, the purported termination was not in the manner warranted by the contract. The trial judge was, therefore, justified to find it wrongful. Ground 3 would therefore, fail.

Ground 4 complains about the trial judge's award of special damages to the respondent in particular:

- (a) when the damages were not proved. - (b) by shifting the burden of proof of those damages to the appellant and - (c) by implying a term in the contract as to remuneration $\frac{1}{2}$ without justification.

Mr. Tibesigwa contended that the claim for salaries for 19 months and other benefits are special damages, which needed to be strictly proved. He submitted that there was no evidence to show that the respondent had worked at that salary scale for that length of time without pay. He pointed out that the appointment letter Exh. P1. apart from stating the date of appointment. does not state the salary scale. After rejecting annexture B which set out the respondent's payment package, the trial judge shifted the burden to prove the respondent's entitlement on the appellant. In counsel's view, that was an error on the part of the trial judge.

Mr. Musisi for the respondent, conceded that claim for arrears of salaries and other benefits are special damages which needed to be strictly proved. He contended however, that when the respondent's attempt to prove the special damages by annexture "B" failed, she led oral evidence based on the pleadings to show that she was employed by the appellant for gain at a pay package of Shs. 281.000 $=$ He reasoned that since the law presumes that a person is employed for gain, the respondent having testified that she was employed by the appellant, the burden shifted to the appellant to show that she was employed for gain and the pay package.

With respect. I do not agree. It is in my view an error to shift that burden to the appellant. That the respondent was employed for gain was not in dispute. What were in dispute were the length of the unpaid employment and the pay package. These are matters of special damages which the respondent is under a duty to strictly prove. The burden to prove them cannot be shifted to the appellant.

Mr. Tibesigwa argued that having rejected annexture "B" the trial judge should not have accepted the respondent's oral evidence, it being a secondary evidence, as to the remuneration. He contended that the reception of the oral evidence offended sections 63 and 64 of the Evidence Act since the requisite notice to produce the original document was not given to the appellant.

The law regarding reception of secondary evidence about the existence. conditions, contents and etc. of a document is governed by sections 63 and 64 of the Evidence Act. Section 63 (a) permits such secondary evidence to be given when the original of the document is shown or appear to be in the possession or power of the person against whom the document is sought to be proved etc. Section 64 however, requires that the party proposing to give such secondary evidence must first give notice to the party in whose possession or power the original of the document is or to his advocate to produce it. It is only when such notice is given and the document is not produced by the party who has it, that the secondary evidence can be given. There are other situations where secondary evidence may be given without the requirement of giving notice to produce first.

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Such situations includes where it is proved that the adversed party obtained possession of the original document by fraud or force.

In the instant case, the respondent sought to prove her remuneration by a letter dated $29 - 7 - 97$ annexture "B" which set out details of her payment package. When she tried to tender a photocopy of that document in evidence, it was rejected. even though she told court that the original was with the appellant. The Managing Director of the appellant had taken it from her ostensibly to assist him process the Company's Clearing and Forwarding Licence for the Year 1999. Despite her several demands for it, the Managing Director never returned it. The trial judge rejected the photocopy of the document because no notice to produce the original was given to the appellant under section 64 of the Evidence Act. It was argued that, having rejected the photocopy of that document on that ground, the trial judge ought not to have allowed the respondent to give oral evidence, which is another secondary evidence, about the amount of her remuneration which formed the contents of the document.

I find this argument quite forceful. The argument for the respondent that her oral evidence regarding her remuneration was based on the pleadings, is not tenable. The figure stated in the pleadings must have been got from somewhere. The respondent did not state the source of her information about those figures. As shown above, however, the appellant obtained the original of that document from the respondent by fraud. Its managing director deceived the respondent that he needed the document to assist him process the company's Clearing and Forwarding Licence for the Year 1999. He subsequently refused to hand it back to the respondent despite her several demands. This conduct was clearly intended to deprive the respondent of evidence of her payment package. This fraudulent act

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entitled the respondent to give secondary evidence of the contents of that document without the need to give notice to the appellant to produce the original. See the proviso to section 64 of the Evidence Act.

In the circumstances I find that the oral evidence of the respondent regarding the contents of the annexture $-B^2$ was properly received.

Mr. Tibesigwa criticized the trial judge for implying into the contract of service. the term of remuneration without justification. He argued that to bolster the respondent's case, the trial judge implied into the contract, without justification, the term of remuneration, when court can only imply a term to a contract of service where the term was so obvious that the parties took it for granted and would accept it if asked. He relied on **Shirlow** vs **Southern Foundries** (1926) Ltd., (1939) 2 ALLER at 124; Jiwaji and Others vs Jiwaji and Another (1968) EA 547 at 554. He submitted that in the instant case, the parties would not have agreed on the rate of remuneration as shown by the evidence of the respondent and of DW 1. The respondent testified that her total monthly pay was Shs. 281.000 = but DW 1 put it at Shs. $40.000$ =. He concluded that the trial judge, therefore, should not have implied that term into the contract.

As stated earlier in this judgment, the fact that the respondent was employed for gain was not in dispute. What was in issue was the amount of her pay. That being a special damage, the duty to prove it was on the respondent. She discharged that burden when she led oral evidence as to the amount of her pay package. I. therefore, do not agree that the trial judge implied the amount of the respondent's remuneration to the contract. He only believed the respondent's evidence, as he

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was entitled so to do. in preference for that of DW 1. For those reasons, this ground would also fail.

Ground 5 complains about the trial judge's award of general damages to the respondent in a contract for payment of a sum of money after he had awarded interest on the decretal sum. Mr. Tibesigwa submitted that, that was an error because in such a contract, award of interest on the decretal sum would cater for general damages. He relied on Francis Sembuya vs All Ports Services (U) Ltd. (SCU) for authority for that proposition.

On the other hand. Mr. Musisi conceded that the principle in **Sembuya's case** (**supra**) is that where interest on the decretal amount is at the commercial rate, no general damages would be awarded because that interest would put the party wronged to a position he would have been in had the wrong not been committed. He submitted however, that **Sembuya's case (supra)**, is distinguishable from the instant case in that in **Sembuya's case**, the interest awarded on the decretal sum. was at the commercial rate while in the instant case, the interest is at court's rate. Therefore, he argued, general damage was properly awarded.

The principle enunciated by the supreme court in Sembuva's case (supra) is that in cases for breach of contract for payment of money, where interest awarded on the decretal amount is at commercial rate, it is wrong to also award general damages. The reason is that, that rate of interest is intended to put the party wronged to a position he would have been in had the wrong not been committed. I respectfully agree with that principle.

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In the instant case, the interest awarded on the decretal sum was not at commercial rate. It was at court's rate. The general damage awarded was, therefore, intended to put the party wronged to the position she would have been in had the wrong not been committed. The trial judge, therefore, properly awarded the general damages. I find no merit in this complaint and the ground would fail.

In the result. I would dismiss the appeal with costs to the respondent. As Mpagi-Bahigeine, JA and Twinomujuni, JA both agree, the appeal is dismissed on that term.

day of December 2001. Dated at Kampala this $4^{th}$ G. M. Okello JUDGE OF APPEAL.

## THE REPUBLIC OF UGANDA

## IN THE COURT OFAPPEAL OF UGANDA

AT KAMPALA

## CORAM: HON. JUSTICE G. M. OKELLO, JA. HON. JUSTICE A. E. N. MPAGI-BAHIGEINE, J. A. HON. JUSTICE A. TWINOMUJUNI, J. A.

b

o

## CIVIL APPEAL NO.17 OF 2OOO

### BETWEEN

### JET SPEED AIR SERVICES (U) LTD. :::::::::::::::::::: AND APPELLANT

JOAN 'IT]MTIHAIRWE RESPONDENT

(Appeal from thc dccision ofthc High Court (Tinyinondi, J) darcd I l/2/2000 in HCCS No.1045 of 1999)

## JUDGEMENT OF A. E. N. MPAGI-BAHIGEINE, JA.

I have read in draft the judgment of G. M. Okello, J. A. I agree that

the appeal should fail and have nothing more to add

Dated at Kampala this ..lt day of . N.e.a.e-^-r.[",v. 200 I tU

> A. E. N. Mpag a rgerne JUSTICE OF,.\PPEAL

## THE REPUBLIC OF UGANDA

# IN THE COURT OF APPEAL OF UGANDA AT KAMPALA

### HON. MR. JUSTICE G. M. OKELLO, J. A CORAM: HON. LADY JUSTICE A. E. N. MPAGI-BAHIGEINE, J. A HON. MR. JUSTICE A. TWINOMUJUNI, J. A

# **CIVIL APPEAL NO.17 OF 2000**

#### **BETWEEN**

JET SPEED AIR SERVICES (U) LTD....................................

$\mathsf{S}$

$10$

## AND

JOAN TUMUHAIRWE....................................

$20$

## (Appeal from the decision of the High Court (Tinyinondi, J) dated 11/2/2000 in HCCS No.1045 of 1999)

# **JUDGMENT OF TWINOMUJUNI, J. A**

I have read the judgment, in draft, of Hon. Justice G. M. Okello, J. A. I agree with the reasoning and conclusions made therein and I have nothing useful

to add. 30

4 th<br>Annual of December 2001. Dated at Kampala this.........

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$\ldots \qquad \qquad \qquad \qquad \qquad \qquad \qquad \qquad \qquad \qquad \qquad \qquad \qquad \$ Hon. Amos Twinomujuni **JUSTICE OF APPEAL.**