Citibank Zambia Limited v Suhayl Dudhia (Appeal No.16/2020) [2025] ZMCA 60 (15 April 2025)

IN THE COURT OF APPEAL OF ZAMBIA HOLDEN AT LUSAKA (Civil Jurisdiction) Appeal No.16 / 2020 SUHA YL DUDHIA RESPONDENT Coram: Kondolo SC, Majula & Muzenga, JJA On 26th March, 2025 and 15t h April, 2025. For the Appellant Mr. M. Maheng'a with M r. A. Akapelwa, both of Messrs Chibesakunda & Company For the Respondent Mrs S. Kalima - Banda with Ms. S. Mvula, both of Messrs J & M Advocates JUDGMENT MAJULA J A, delivered the J udgm en t of the Cou rt . Cases referred to: 1. Kalusha Bwalya v. Chardore Properties Limited and Another SCZ Appeal No. 20/2015 2. Jfq.lmes Limited v. Buildwell Construction Company L imited (1973) ZR 97 3. Zambia National Provident Fund v. Chirwa ( 1986) ZR 70 4. Giles Yambayamba v. Attorney General and National Assembly of Zambia (2015) Vol. 2 ZR 401 5. Sydney Mungala and Collins Chali v. Post Newspapers Limited (SCZ Appeal No. 133/2013) J2 6. Chibwe v. Chibwe(2001)ZR. 1 7. Swarp Spinning Mills Plc v. Chileshe and Others (2001) ZR 2 8. Jacob Nyoni v. Attorney General SCZ No.11 of 2001 9. Superbets Sports Betting v. Batukwe Kalimukwa (Appeal No. 110/ 2016) 10. Collet v. Van Zyl Brothers Limited (1966 ZR 65 (CA) 11. Attorney General v. John Tembo (SCZ Judgment No. 1 of 2012) 12. First Quantum Mining and Operations Limited v. Obby Yendamoh (SCZ Appeal No. 206/2015) 13. Standard Chartered Bank v. Celine Nair (CAZ Appeal No.14 I 2019) 14. Dennis Chansa v. Barclays Bank Zambia Plc (SCZ Appeal No.111 / 2011) 15. William Carlisle David Wise v. E. F. Hervey Limited ( 1985) ZR. 179 16. Food Reserve Agency vs Simate Simate & Others (Appeal No. 135 of 2022) 17. Tolani Zulu and Musa Hamwala v Barclays Bank Limited (SCZ Judgment 17/ 2003) 18. Zambia Consolidated Copper Mines Ltd vs Matale (1995 - 1997) ZR 144 19. Southern Water & Sewerage Company Limited vs Sanford Mweene - SCZ Appeal No.14 of 2007 20. Redrilza Ltd vs Abu id Nkazi & 4 Others (SCZ Appeal No. 101 / 2009) 21. Atlas Copco (Zambia) Limited vs Andrew Mambwe (SCZ Appeal No.137/ 2001) 22. Chilanga Cement Plc vs Kasote Singogo (2009) ZR 122 (SC) 23. Josephine Mwaka Mwambazi vs Food Reserve Agency (SCZ Appeal No.128/2001) 24. Chintomfwa v Ndola Lime Limited (1999) ZR 172 25. Dennis Chansa v Barclays Bank Zambia Plc (SCZAppeal No. 111 of2011) 26. African Banking Corporation v Benard Fungamwango CAZ Appeal No 148/ 2020 27. Amiran Limited vs Robert Bones (SCZ Appeal 42/ 201 OJ 28. Zambia National Commercial Bank v. Joseph Kangwa (SCZ Appeal 54/ 2008) 29. Kansanshi Mining Plc vs Mwelwa (CAZ Appeal 103/ 2019) Legislation referred to: J3 1. Industrial Relations Court Rules, Chapter 269 of the Laws of Zambia. 2. Employment Act, Chapter 269 of the Laws of Zambia (Repealed). 3. Employment Act, No. 3 of 2019. 1.0 Introduction 1. 1 This appeal emanates from the decision of the Honourable Mr. Justice E. Mwansa delivered on 29th November, 2019 in the Industrial Relations Division of the High Court. The Respondent had approached the lower court seeking damages for unfair, unlawful and wrongful termination of employment. 1.2 The Respondent also sought a declaration that he was entitled to be offered to purchase the Appellant's motor vehicle, a jeep registration number ALB 312 at its current bank value in accordance with the Citibank (Z) Limited Car Policy. 2.0 Background 2.1 The Respondent was on 10th December, 2010, employed by the Appellant as a Relationship Manager. From the date of his engagement, he worked diligently and rose through the ranks to the position of Assistant Vice President in 2011. He also earned a bonus for good performance in the same year. 2.2 On 15th May, 2013, the Respondent was suspended from employment. He was thereafter instructed to show cause J4 why disciplinary action should not be taken against him for disclosure of confidential information to a client. He was subsequently invited for a disciplinary hearing on 11 th June, 2013 by the Appellant Bank. 2.3 By a letter dated 4 th July 2013, the Respondent's employment contract was terminated by paying him one-month salary in lieu of notice. The Bank thereafter prepared a statement of dues and liability dated 4 th July, 2013 and gave the Respondent a net liability of K161,193.30. 3.0 Decision of the Court below 3.1 In determining the issues that were brought before it, the lower Court began by distinguishing "unfair dismissal," which is based on statutory violations under the Employment Act or the Industrial and Labour Relations Act, from "wrongful dismissal," which arises from breaching the employment contract. On the claim for unfair dismissal, the court found no evidence of any statutory breach by the employer. Because no provision of the Employment Act or the Industrial and Labour Relations Act had been violated. The court accordingly dismissed the claim for unfair dismissal. 3.2 As regards the claim for wrongful dismissal the court held that once disciplinary charges had been brought against the Respondent and that process initiated, the employer was obligated to complete it. Instead, the employer bypassed the ongoing proceedings by invoking a "notice clause," which JS constituted a breach of the contractual terms, thus resulting in wrongful dismissal. 3.3 Although employers can typically terminate employment by notice or payment in lieu of notice without providing reasons , that option was invalidated once formal charges and disciplinary proceedings were already underway. 3. 4 As regards the claim for the bank vehicle, the court below found that the employer had amended its car policy in 2013 and duly notified the Respondent. Under the revised policy, the Respondent had no automatic right to purchase the allocated bank vehicle. The Respondent was therefore directed to surrender the vehicle immediately. 3. 5 Ultimately, for wrongful dismissal, the court awarded the Respondent 38 months' salary as damages. He was also awarded costs, to be taxed if not agreed upon by the parties. 4.0 Grounds of Appeal 4.1 Being disenchanted with the decision of the Court below, the Appellant has appealed to this Court based on the following grounds: "l. The learned High Court Judge erred in law and fact when he held that the Appellant could not invoke the notice clause when disciplinary proceedings had commenced, effectively denying the full effect of the J6 contract of employment contrary to the sanctity of freedom of contract. 2. The learned High Court Judge erred in law and fact when he refused and/ or neglected to hold that no prejudice was occasioned to the Respondent by not concluding the disciplinary hearings and/ or not following procedure in his dismissal despite fervently finding that the Respondent refused and/ or neglected to attend the disciplinary hearing. Alternatively, no prejudice was occasioned because he had committed an offence which was dismissible. 3. That learned High Court Judge erred in law and in fact when he pierced the veil and looked behind the notice of termination, thereby putting into consideration extraneous matters that he ought not to have considered, contrary to established law and jurisprudence, resulting in a catastrophic error of both law and fact. 4. Alternatively, the learned High Court Judge erred in law and in fact when he departed from the normal measure of damage in employment law, the notice period without any finding of fact to warrant the same, let alone awarded an astronomical award of damages not supported by law or jurisprudence. 5. The Learned High Court Judge erred in law and fact when he awarded costs against the Appellant which is undeniably offensive to Rule 44(1) of the Industrial and Labour Relations Court Rules and established J7 jurisprudence by the Supreme Court, later alone violating the celebrated concept of stare decisis. 6. Alternatively the Learned High Court Judge improperly exercised his discretion by awarding costs against the Appellant despite the Respondent having lost on all but one of the many grounds mounted before the High Court resulting a grave error of both fact and law." 5.0 Appellant's arguments 5.1 In support of the appeal, the Appellant's Counsel filed in their heads of argument on 10th February 2020. In the 1st ground of appeal, the Appellant contends that the employment contract explicitly allows termination "at any time" by giving the stipulated notice, or payment in lieu. Clause 6 of the Respondent's Offer of Employment (at p_age 60 of the ROA) makes this right clear. It has been argued that by preventing the employer from invoking the notice clause during disciplinary proceedings, the High Court effectively rewrote the contract and infringed upon the principle of freedom of contract. 5.2 The Employment Act Cap 268 (repealed) has been referenced to strengthen the argument that, at the material time, there was no requirement for giving reasons when terminating a contract by notice. 5. 3 Reliance has been placed on the case of Kalusha Bwalya v. Chardore Properties Limited and Another1 for the J8 principle that parties are bound by contracts they have freely entered into in the absence of fraud , mistake, or misrepresentation. Holmes Limited v. Buildwell Constntction Company Limited2 (referenced in Kalusha Bwalya1 ) has been called in aid affirming that a written contract's terms must be respected. 5.4 Counsel for the Appellant has also drawn our attention to the General Principles of "Sanctity of Contract" quoted from Ewan McKendrick's Contract Law: Text, Cases and Materials, emphasizing that courts should not lightly interfere with parties' clear contractual stipulations. 5.5 In concluding on ground 1, the Appellant has submitted that the High Court's refusal to give effect to a valid notice clause violates sanctity of contract and should be reversed. 5.6 Moving to the next ground of appeal, the Appellant's key argument is that even if procedures were not fully followed , the Respondent had committed an act justifying dismissal. His refusal to attend the hearing meant no prejudice was suffered. 5 . 7 The case of Zambia National Provident Fund v. Chirwa3 was cited where it was held: «Where it is not in dispute that an employee has committed an offence for which the appropriate punishment is dismissal and he is also dismissed, no J9 injustice arises from a failure to comply with laid-down procedure." 5.8 The Appellant argues that the High Court ought to have recognized no prejudice was occasioned to the Respondent, as his actions justified dismissal under the contract. 5.9 Pressing on to ground 3, the Appellant insists that courts should only "look behind" the notice clause if there is sufficient evidence of malice or ulterior motives. In this case, the Judge pierced the veil without adequate factual basis. We have been referred to the case of Giles Yambayamba v. Attorney General and National Assembly of Zambia4 where the Supreme Court laid down two cardinal considerations for piercing the veil: "a) There must be sufficient evidence suggesting termination was motivated by factors beyond the employer's contractual right. b) The court's discretion to peer behind the notice clause must be exercised "judicially and judiciously." 5.10 In addition, Sydney Mungala and Collins Chali v. Post Newspapers Limited5 has been cited which reiterates that where there is insufficient evidence of malice or ulterior motive, the court should not look behind the notice clause. JlO 5.11 In rounding off on ground 3, the Appellant argues that the High Court contravened these precedents by piercing the veil absent any proof of malice. 5 . 12 In respect of ground 4, the grievance is the departure from the normal measure of damages. It has been asserted that the usual measure for wrongful dismissal damages is the notice period set out in the contract. The Appellant criticizes the Judge for awarding 38 months ' salary with no explicit justification or finding of exceptional circumstances. One month's salary was the contractual notice period. 5.13 To solidify the Appellant's arguments, the following cases have been referenced: Chibwe v. Chibwe6 where it was held that Courts must provide reasons for their decisions and base conclusions on facts in the record. 5.14 In Swarp Spinning Mills Plc v. Chileshe and Others 7, the Supreme Court guided that the "normal measure of damages" is the contractual notice period. Departure is only justified in exceptional circumstances, e.g., undue distress or unusually long unblemished service. 5. 15 Regarding a departure from the normal measure of damages, Jacob Nyoni v. Attorney General8 has been highlighted which articulated the principle that long, unblemished service can justify more than the notice period. 5 .16 In winding up on this ground, the Appellant submits that no exceptional or aggravating circumstances were found; Jl 1 therefore, 38 months' salary 1s excessive and contrary to established jurisprudence. 5 . 1 7 In ground 5, the displeasure emanates from the infliction of costs on the Appellant contrary to the provisions of Rule 44(1) of the Industrial and Labour Relations Court Rules. It has been argued that the aforecited provision permits costs in labour matters only where there is clear misconduct, vexatious conduct, or blameworthy behaviour by the losing party. The averment is that the High Court awarded costs without a finding of any blameworthiness on the Appellant's part. They have placed great store on the authority of Superbets Sports Betting v. Batukwe Kalimukwa9 where the Supreme Court reiterated that: ''The general rule that costs follow the event cannot be applied contrary to statutory provisions . . . The losing party can only be condemned if their conduct is blameworthy.'' 5.18 Since no blameworthy conduct by the Appellant was found, the Appellant argues that awarding costs violated Rule 44( 1) and the Supreme Court's guidance in Superbets (supra). 5.19 The 6 th ground is in the alternative where it has been submitted that the Respondent succeeded on only 1 out of 9 claims. Awarding costs in such circumstances is an improper exercise of the court's discretion. The case of Collet v. Van Zyl Brothers Limited10 was adverted to which outlines the J12 principle that costs are at the discretion of the trial judge, however such discretion is to be exercised judicially. Furthermore, that courts should "view the litigation as a whole" to see the substantial result before awarding costs. 5.20 In light of the foregoing, the Appellant argues that, because the Respondent's success was minimal, the Judge's decision to award full costs was either erroneous or an unduly harsh exercise of discretion. 6.0 Respondent's Arguments 6.1 In contesting the appeal, the Respondent's counsel filed their heads of argument on 13th March 2020. 6.2 In the 1st ground of appeal, the Appellant has contended that they had the right to invoke the notice clause as per the employment contract. The Respondent, on the other hand, has argued that since disciplinary proceedings had started, termination should have followed due process, including a fair hearing. 6.3 The court found that the Appellant did not adhere to its own code of conduct and disciplinary procedures, which required that once charges were brought against an employee, the process had to be completed before termination could be considered. 6.4 It has been asserted that the Respondent was never given full details of the allegations against him. That the Respondent's legal request for more details on the charges was ignored. J13 6.5 According to the Respondent, he was denied legal representation at the hearing, which was eventually not held at all. Instead of completing the disciplinary process, the Appellant abruptly terminated him under the notice clause, which was deemed a cover-up for wrongful dismissal. 6.6 The Respondent has further submitted that the law grants courts the power to look beyond contracts and examine whether justice has been done. That the Court below had the power to do substantial justice over and above the rules of evidence based on Section 85(5) of the Industrial and Labour Relations Act. The High Court exercised this power and found that the Appellant misused the notice clause to sidestep their legal obligations. 6.7 In the submissions, the Respondent highlighted the evidence adduced in the Court below and claimed that his termination was a deliberate scheme orchestrated to remove him under false allegations of incompetence and misconduct. It has been argued that the hearing process was a farce, as his dismissal was already predetermined. 6.8 It has been contended that there was insufficient evidence against the Respondent. The Appellant claimed that the Respondent had disclosed confidential information without providing any details about the breach, and several requests for clarification from the Respondent's lawyers went unanswered. 6 .9 Counsel went on to assert that there were contradictions in the Appellant's arguments in that, on one hand, the J14 Appellant argued that the termination was based on a notice clause, yet simultaneously tried to justify it as a dismissal for incompetence and misconduct. The court noted that if the termination was genuinely under the notice clause, the Appellant would not have gone to great lengths to prove misconduct. 6.10 The Respondent has referred us to testimonies from Citibank's witnesses and has discredited Citibank's claims of incompetence and validated the claim of procedural unfairness. Our attention has been drawn to the case of Attorney General v. John Tembo 11 for the proposition that once disciplinary charges have been initiated, an employer cannot abandon the process and opt for a notice clause. 6.11 In reaction to the Appellant's assertion that the Respondent refused or neglected to attend the disciplinary hearings or alternatively, that even if there was a failure to follow disciplinary procedures, no prejudice was caused because the Respondent was guilty of a dismissible offence, the Respondent has strongly objected to this position. It has been argued that the Appellant is introducing an alternative argument on appeal, which was never raised in the lower court. Reliance has been placed on the legal principle that an appellate court should not entertain matters not raised in the lower court. To fortify this proposition, we were referred to the case of First Quantum Mining and Operations Limited v. Obby Yendamoh .12 In this case, the Supreme Court J15 rejected an attempt to introduce an alternative argument at the appellate stage. 6.12 Similarly, the Respondent argues that the Appellant is attempting to "sneak" an alternative argument, which should not be entertained. The Respondent further contends that the Appellant has misquoted the lower court's findings. The Respondent argues that the lower court never made a finding that he refused or neglected to attend the disciplinary hearings. It has been averred that there were procedural flaws in the dismissal. 6 . 13 Turning to the assertion by the Appellant that there was no prejudice suffered by the Respondent, it is the Respondent's contention that his reputation and employability in the banking sector were severely damaged. That the Zambian banking sector is small, and the dismissal led to blacklisting. That the lack of fair treatment itself constitutes prejudice. 6.14 The core contention under ground 3 is that the High Court Judge erred in law and fact by "piercing the corporate veil" and looking behind the notice of termination. The Appellant argues that this was unnecessary and improper, as it involved extraneous considerations not warranted by law or jurisprudence. 6.15 The Respondent points out that the Appellant contradicts itself in its submissions in that on the one hand in ground 1, the Appellant argues that the lower court had no jurisdiction to look beyond the invocation of the notice clause. On the other hand, in ground 3 , however, the Appellant concedes J16 that the lower court does have the authority to examine the termination if certain conditions are met. According to the Respondent, this contradiction weakens the Appellant's case, as it implies recognition that the court can indeed review the termination process under specific circumstances. 6 . 16 The Respondent highlights the Appellant's admission 1n ground 2 that it failed to follow its grievance procedure, an omission deemed malicious, and cites testimony from both sides indicating the Respondent was singled out and mistreated, contradicting the Appellant's claim of no malice. 6.17 In concluding on this ground, the Respondent argues that the evidence on record clearly justified the lower court's decision to look behind the notice of termination and we have been urged to dismiss ground 3 for lack of merit. 6.18 In ground 4 of the appeal, the Appellant 1s criticized for referencing irrelevant case law (such as Chibwe v Chibwe6 , a divorce case) instead of citing employment law precedents. It has been asserted that more recent cases from the same Court were available that established the measure of damages for wrongful termination. 6. 19 Standard Chartered Bank v. Ce line Nair13 is a case in point where the lower court awarded 36 months of damages for constructive dismissal, considering the employee's seniority, difficulty in securing similar employment, and the specific circumstances of the case. The Respondent has also referenced other cases such as Dennis Chansa v. Barclays Bank Zambia Plc14 and First Quantum Mining and J17 Operations Limited v. Obby Yendamoh12 to buttress the point. The Respondent argued that his wrongful termination severely damaged his reputation in the close-knit Zambian banking industry, affecting his employability, as evidenced by job rejections and adverse references. He also claimed to have suffered mental anguish, supporting his claim for aggravated damages. 6.20 In grounds 5 and 6, the Respondent disputes the Appellant's assertion that he succeeded on only one issue, maintaining that the court ruled in his favour on all damage claims. Moving on, the Respondent's Counsel has looked at the relevant provision of the law dealing with costs 1n the Industrial and labour Relations Division of the High Court which is Rule 44( 1) of the Industrial and Labour Relations Court Rules. They have adverted to the Supreme Court's decision in Superbets Sports Betting v. Batukwa Kalimukwa9 summarized this principle into one requirement: "blameworthiness. 11 6.21 They argue that the Appellant's conduct qualifies as vexatious because: 1. The Appellant persisted with legally untenable arguments. 2. The Appellant misrepresented case law and facts . 3 . The Appellant deliberately ignored well-settled legal principles. J18 6. 22 Reliance was further placed on the case of Standard Chartered Bank Zambia Plc v. Celine Meena Nair13 which reinforced that the court record must show evidence of blameworthiness before costs can be awarded. 6 .23 It is argued that the issue of costs is grounded in statute, and there is no requirement to expressly plead the statute as long as the evidence satisfies its requirements. Relying on William Carlisle David Wise v. E. F. Hervey Limited15, the Respondent contends that clear evidence of vexation was provided, even if not explicitly labelled, and this meets the statutory threshold for costs. 6.24 The Respondent beseeched the Court to dismiss the entire appeal with costs. 7.0 HEARING OF THE APPEAL 7.1 At the hearing of the appeal, Mr. Maheng'a confirmed that the Record of Appeal and Heads of Argument were filed on 10th February 2020, which he relied upon. He pointed out that the matter arose in 2013, prior to the enactment of the Employment Code Act, No 3 of 2019; therefore, the law applicable is the one that was in force at the time. That under the previous law, an employer could lawfully terminate an employee by notice alone. He asserted that the case of Giles Yambayamba v. Attorney General and National Assembly of Zambia4 provides guidance on when a court may pierce the corporate veil, emphasizing that this is only permissible in limited and exceptional circumstances. ... J19 7.2 In this case, there was insufficient evidence to justify piercing the veil. There was also no evidence that the employer relied on factors outside the employment contract when invoking the termination clause. Consequently, the Labour Court erred in piercing the veil. 7.3 He went on to argue that the court below improperly awarded costs in a matter before the Industrial Relations Division of the High Court, which traditionally does not award costs. Reference was made to our decision in Food Reserve Agency vs Simate Simate & Others16 which dealt extensively with this issue and affirmed the principle that costs should generally not be awarded in labour matters under the Industrial Relations jurisdiction. 7.4 On the measure of damages, he pointed out that the Lower Court awarded the Respondent 38 months' salary in damages, which was a departure from the normal measure of damages without any evidential basis or justification. 7.5 In response, Mrs Kalima-Banda submitted that the Respondent filed their heads of argument on 13th March 2020 and a Supplementary Record of Appeal on 17th March 2020. She argued that the record shows that the Respondent requested further information during the disciplinary process that was initiated by the Appellant. Despite this, the Appellant invoked the notice clause before concluding the disciplinary hearing. The Respondent's employment was J20 terminated on 4th July 2013, and the process reflected unfair treatment. 7.6 Pertaining to the last ground of appeal, Mrs Kalima-Banda observed that in light of inflation and limited employment prospects in the banking sector, the 38-month award was justified and fair. 7.7 The main point submitted in reply by Mr Maheng'a was that a review of pages 109 to 129 of the Record of Appeal shows that the Respondent was invited to a disciplinary hearing but did not attend. That the Appellant thereafter lawfully exercised its right under the contract by invoking the termination clause. 8.0 ANALYSIS AND DECISION OF THIS COURT 8.1 We have carefully examined the record of appeal, counsel's submissions, and the cited legal authorities. We intend to address grounds 1 and 2 together, then consider grounds 3 and 4 as presented, followed by grounds 5 and 6, which have been argued jointly. 9.0 Grounds 1 & 2 - Invocation of notice clause amidst pending disciplinary hearings 9 .1 In the 1st and 2nd grounds of appeal, the question that arises for determination is whether the notice clause in the employment contract could be invoked after disciplinary proceedings had commenced. J21 9.2 The core of the Appellant's argument is that the contract of employment had an express provision allowing termination "at any time" on notice (or payment in lieu). That this must be upheld, as it reflects the parties' freedom to contract absent fraud, mistake, or misrepresentation. By disallowing the employer to invoke this clause during disciplinary proceedings, the High Court effectively rewrote the parties' agreement, thus infringing upon the sanctity of contract. 9.3 The Respondent counters that once disciplinary proceedings began, termination should have followed due process, including a fair hearing. 9 .4 We have addressed our minds to the provisions of the law in terms of the options available to an employer should they want to terminate the services of an employee. We hasten to point out that this matter arose before the change in employment law, that is, before the enactment of the Employment Code Act, No. 3 of 2019. This Act mandates that an employer must provide a valid reason related to the employee's conduct, capacity or operational requirements of the undertaking when terminating a contract. Prior to the enactment of this Act, there could be termination by notice without the necessity of providing valid reasons. 9. 5 Turning to the case at hand, we have looked at Tolani Zulu and Musa Hamwala v Barclays Bank Limited17 which is instructive in this regard. The Apex Court had this to say on the matter: I -,,_ " • r J22 "From the evidence, it is clear no disciplinary action was taken against the appellants, they were merely suspended. They were suspended on suspicion of a very serious fraud. The suspension was never lifted. The respondent opted to use the Notice Clause in the Agreement, which was an option open to them. " 9.6 In addition, they stated: <<The respondent had a number of options open to them; they could have had the appellants prosecuted; put on disciplinary charges or opt to give them notice required under the Conditions of Service or pay the amount in cash in lieu of notice. The respondent opted for the last option of paying a month's salary in lieu of notice." 9.7 Accordingly, where multiple lawful courses of action exist, an employer cannot be faulted for choosing one over another. However, in casu, the Appellant had commenced disciplinary proceedings against the Respondent. In the circumstances the option to resort to the notice clause was no longer available to the Appellant. We find no merit in grounds one and two. 10.0 Ground 3 - Piercing of the veil - Whether justified? 10. 1 Moving on to the next ground of appeal, the issue that emerges is whether the trial court was entitled to "pierce the J23 veil" behind the notice clause and assess the real motivation for dismissal. 10.2 In their submissions, the Appellant has contended that courts should only look beyond the notice clause when there is sufficient evidence of malice or ulterior motive. It has been argued that in this instance, the judge pierced the veil without an adequate factual foundation. 10.3 On the other hand, the Respondent contends that the evidence on record justified the court's decision to look behind the notice of termination, thus warranting the dismissal of ground 3. 10.4 In determining this ground, we must state at the onset that there are a multitude of authorities regarding whether the Court can pierce the veil to establish the real reason for termination. We begin with the provisions of Section 85(5) of the Industrial and Labour Relations Act, which states: "(SJ The Court shall not be bound by the rules of evidence in civil or criminal proceedings, but the main object of the Court shall be to do substantial justice between the parties before it." 10.5 In the instructive case of Zambia Consolidated Copper Mines Ltd v. Matale19, the Supreme Court held that: "In the process of doing substantial justice, there is nothing in the Act to stop the Industrial Relations Court from delving behind or into the reasons given for . . ( J24 termination in order to redress any real injustices discovered such as the termination on notice or payment in lieu of pensionable employment in a parastatal on a supervisor's whim without any rational reason at all, as in this case." 10.6 The Court reaffirmed its position in Southern Water & Sewerage Company Limited v. Sanford Mweene19, where Justice Chitengi stated that: "The fact there is a notice clause for terminating a contract without giving reasons does not debar the Industrial Relations Court from looking behind the termination to ascertain if some injustice was done by the employer when invoking the termination clause. This is the discretion that the Industrial Relations Court invoked in this case and the Court was in this respect on firm ground using this discretion." 10.7 The Apex Court has been consistent with this position in a number of cases such as Redrilza Ltd vs Abuid Nkazi & 4 Others, 20 Atlas Copco (Zambia) Limited vs Andrew Mambwe, 21 Chilanga Cement Plc vs Kasote Singogo 22 and Josephine Mwaka Mwambazi vs Food Reserve Agency23 to name a few. Relying on the precedent set by the foregoing cases, we have no hesitation in stating that a court does indeed have the power to go behind the termination clause to ascertain the real reason for the termination and whether or not it was predicated on malice. 10. 8 A close examination of the circumstances of this case reveals that there was unfair treatment of the Respondent. The ., ( J25 witnesses that were called (RW3) Samir Karia for example did express regret in the manner the Respondent was treated (See page 538 ROA) and RW4 (Mabvuto Daka, Head of HR), acknowledged that the Respondent was treated unjustly (see pages 544 ROA). 10. 9 It is clear that the Respondent was not given details of the complaints against him and was terminated before receiving necessary information to defend himself, entailing a denial of due process. 10.10 The Appellant's own witnesses expressed discomfort in justifying the Respondent's termination, reinforcing the claim of procedural unfairness. There is evidence of abusive language being used against the Respondent (page 514 & 515 ROA). The most damning evidence is that appearing at pages 518 to 519 ROA where (CW4) Kansanga Sondoyi testified as follows: "We shared an office. I sat on one end and the two on the other end. Each time Samir would walk out, he would stand behind the complainant and start a disrespectful conversation, reprimand him, in full audience." "He reprimanded him and said he was a fucking Vice President and that this was bull shit." (Bold for emphasis) 10. 11 Against this backdrop, we come to the inescapable conclusion that the court cannot be criticized for using the provisions of Section 85(5) of the Industrial and Labour Relations Act to do substantial justice to the parties by ··• I r J26 lifting the veil. The testimonies, 1n our eyes, illustrate targeted mistreatment, unfair disciplinary action, verbal abuse and humiliation and failure to follow due process. 10.12 On this score, the attack on the Judge's decision 1s unsustainable. We thus find ground 3 to be devoid of merit and dismiss it. 11.0 Ground 4 - Award of damages- whether excessive 11. 1 The next ground of appeal questions whether the High Court erred in awarding 38 months' salary in damages, departing from the standard measure based on the notice period. 11.2 The Appellant challenges the 38-month damages award as excessive, arguing it deviates from the standard one-month notice period without justification or exceptional circumstances. 11 .3 The Respondent counters that the award aligns with Supreme Court guidance to consider economic conditions and highlights the lasting reputational damage suffered in the close-knit Zambian banking industry. 11.4 The principle with regards award of damages for wrongful dismissal is normally limited to the notice period unless special circumstances exist. There are a myriad of authorities which have repeatedly asserted this viewpoint. The Jacob Nyoni v The Attorney-General8 establishes the normal measure of damages in wrongful termination cases, ranging from the notice period to two years' salary. Chintomfwa v J27 Ndola Lime Limited24 acknowledges that damages can exceed the standard measure when job prospects are grim. 11.5 Further drawing guidance from Chilanga Cement Plc v Kasote Singogo21 which reiterates that, in deserving cases, courts may award more than common law damages for loss of employment and Dennis Chansa v Barclays Bank Zambia Plc25 where it was noted that as global economies worsen, damages should increase due to longer job search periods. 11.6 We too, added our voice to the principle of departing from the normal measure of damages if the dismissal was traumatic. In the case of African Banking Corporation v Benard Fungamwanga26 we upheld an award of 36 months' salary, considering the banking sector's employment difficulties. 11. 7 These cases collectively show how courts have evolved 1n awarding damages beyond traditional limits, taking into account economic conditions, employment opportunities, and the circumstances of termination. We will faithfully adhere to the views expressed in the fore going cases in this regard. We do not find that the damages awarded (38 months' salary) were excessive given the position the Respondent held and the grim job prospects. 11.8 We accordingly find there 1s no merit in the 4 th ground of appeal and dismiss it. J28 12.0 Ground 5 & 6 - Infliction of costs- provisions of Rule 12. 1 The grievance in grounds 5 and 6 of the appeal concerns the lower court's award of costs to the Respondent. The key issue before this Court is whether the High Court had a legal basis under Rule 44( 1) of the Industrial Relations Court Rules to award costs against the Appellant. 12.2 It is trite that a court enjoys broad discretion to award costs, however such discretion is not unbridled. In the Industrial and Labour Relations Division, there are specific instances when costs can be imposed on a party which are set out in Rule 44(1). For ease of reference, this Rule provides as follows: "(1) Where it appears to the court that any person has been guilty of unreasonable delay, or of taking improper, vexation or unnecessary steps in any proceedings, or of other unreasonable conduct, the court may make an order for costs or expenses against him. " 12.3 The Apex Court has consistently expressed the position that costs in the IRD are only awarded in clear circumstances. One case that springs to mind is that of Amiran Limited vs Robert Bones27 where Mambilima CJ (as she then was) guided as follows: "That in matters before the Industrial Relations Court, costs can only be awarded against a party if such a party is guilty of unreasonable delay, or of taking improper, J29 vexatious, or unnecessary steps in any proceedings, or of other unreasonable conduct. " (underlining ours for emphasis only). 12.4 Furthermore, in Zambia National Commercial Bank v. Joseph Kangwa28, the court articulated a similar position, stating as follows: "With regard to Rule 44 of the Industrial Relations Court Rules contained in the Industrial and Labour Relations Act, Chapter 269 of the Laws of Zambia, provides that a party should only be condemned in costs if they have been guilty of misconduct in the prosecution or defence of the proceedings. We wish to adopt the principle in that rule since this is a matter of coming from the Industrial Relations Court. We do not find any misconduct in the Respondent's defence of this appeal. 12.5 In 2016, the Superior Court maintained its stance on the criteria for the award of costs in the Labour Court in the case Superbets Sports Betting v Batukwe Kalimukwa. 9 12. 6 We too, had occasion to express ourselves in Kansanshi Mining Plc vs Mwelwa29 following the reasoning adopted in the Supreme Court decisions. 12.7 Drawing guidance from the plethora of authorities on the award of costs in relation to Rule 44 of the Industrial Relations Court Rules, it is abundantly clear that such an award can only be inflicted on an erring party who is guilty of vexatious or unreasonable conduct. The aforecited Rule departs from the usual "no costs" rule. However, there is a ... I , J30 requirement for evidence to be adduced of vexatious or unreasonable conduct. 12.8 In this particular instance, we are not persuaded that the Appellant is guilty of this misconduct to warrant an infliction of costs. We disagree with the instances outlined by the Respondent to indicate that the Appellant was a vexatious litigant or exhibited unreasonable behaviour. A party deserves their day in court and should not be stifled. 12.9 For the foregoing reasons, we are inclined to agree with the Appellant that the award of costs was erroneous as it violated the provisions of Rule 44. The criteria to depart from the "no costs" rule was abrogated. As stated in the case of Collet v. Van Zyl Brothers Limited10, discretion on costs must be exercised judicially, considering the overall result of the litigation. 12.10 We find merit in ground 5 and uphold it. Ground 6 becomes otiose in view of our findings in ground 5. 13.0 CONCLUSION 13.1 Crisply put, the sum of our judgment is as follows : 1. Grounds 1 & 2 fail as the employee was not entitled to abandon the on-going disciplinary process and opt to give notice. 2 . Ground 3 fails. The trial Judge's decision to look beyond the notice clause was justified under Section 85(5) of the J31 Act due to evidence of unfair treatment, abuse, and lack of due process. 3 . Ground 4 is dismissed. We uphold the 38-month salary award considering the Respondent's position, prevailing economic conditions, limited job prospects 1n the banking sector, and the circumstances of the termination. 4. Grounds 5 succeeds. There was no evidence of misconduct or vexatious conduct by the Appellant to justify the award of costs under Rule 44( 1 ). 13.2 Each party shall bear the costs. --- M. M. Kondolo , SC COURT OF APPEAL JUDGE K. Muzenga COURT OF APPEAL JUDGE