World Vision Zambia v Kabila Sitali (APPEAL NO. 177/2016; SCZ/8/213/2016) [2019] ZMSC 381 (23 July 2019)

. . IN THE SUPREME COURT OF ZAMBIA APPEAL NO. 177 /2016 HOLDEN AT LUSAKA SCZ/8/213/2016 (Civil Jurisdiction) BETWEEN: WORLD VISION ZAM JUC, ,r If.\ R Y_ . 2 3 JUL 2019 PELLANT AND KABILA SITALI CORAM: Hamaundu, Malila and Kaoma, JJS On 9 th July, 2019 and 23rd July, 20 19 For the Appellant: Mr. F. S. Mudenda of Chonta, Musaila and Pindani Advocates For the Respondent: Mr. M. Ch itundu and Mr. N. Khunga of Barnaby & Chitundu Advocates JUDGMENT KAOMA, JS delivered the Judgment of the Court Cases referred to: 1. Zambia Privatisation Agency v James Matale (1996) Z. R. 157 2. Chintomfwa v Ndola Lime Company (1999) Z. R. 172 3. Chilanga Cement v Kasote Singogo (2009) Z . R. 185 4. Attorney-General and Development Bank of Zambia v Gershom Moses Mumba - SCZ Appeal No. 50/2002 5. Zambia Commercial National Commercial Bank Pie v Joseph Kangwa - SCZ Appeal No. 54/2008. 6. Konkola Copper Mines Pie v Aaron Chifwembe and another - Selected Judgment No. 22 of 2016 7. Swarp Spinning Mills Pie v Chileshe and ot hers (2002) Z. R. 23 8. Moses Choonga v ZESCO Recreation Club ltezhi-Tezhi - Appeal No. 168/2013 9. Dennis Chansa v Barclays Bank Zambia PLC - SCZ/8/128/2011 10. Zambia Airways Cor poration ltd v Gershom Mubanga (1 990/92) Z. R. 149 11 . Bank of Zambia v Joseph Kasonde (1997) Z. R. 238 12. Duncan Sichula and MUZI Transport Freight and Forwarding ltd v Catherine Mulenga Chewe (2000) Z. R. 56 Legislation referred to: 1. Industrial Relations Court Rules, Cap 269, Rule 44. J2 This appeal arises from a judgment of the Industrial Relations Court '(!RC) delivered on 7 th July, 2016. The short history of this appeal 1s that the appellant employed the respondent as sponsorship facilitator on a fixed term contract in 2009. He was working at the appellant's Mbala office. He was given a second contract to run from 25t h November, 2011 to 24th November, 2013. He was promoted to Regional Sponsorship Coordinator responsible for Northern Region on 1st March, 2012 and he moved to Kitwe to take up his new position. Later, the appellant carried out an internal a udit of its accounting records at Mbala and disc overed thre e payments purportedly made to the r e spondent from its bank account without supporting documents . The respondent denied any knowledge or wrongdoing in relation to the payments in issue. Despite denial of wrongdoing, he was ch a rged on 27 th Se pte m ber, 2012 with the offence of dishonest conduct involving the three cheque paym ents and w as asked to exculpate himse lf and to attend a case hearin g on 3 rd O ct ober, 201 2, which h e did . He denied k n owled ge of the p ayments , bo th in his exculpa tory s tatement a nd dur ing the case h earing. He was s umma rily dis.mis sed from employm en t on 5 th O ctober , 2 01 2 . J3 The disciplinary committee found that the respondent fraudulently made payments to himself worth more than ZMW 15,000 and approved various fraudulent payments. On 14th October, 2012 the respondent appealed against his dismissal to the National Director who replied on 5 th November, 2012 saying in view of the respondent's insistence that all signatures on Payment Request Vouchers and cheques purported to be his were forged, further investigations were underway and he would be informed of the outcome in due course. However, on 18t h December, 2012 the National Director upheld the dismissal on the basis that during the case hearing, the respondent was give n an opportunity to exculpate himself of the charge of dishonest conduct but he did not prove that the signatures on the cheques were not his. This prompted the respondent to apply to the IRC for leave to lodge complaint out of time and on 5 th April, 2013 he filed the complaint, seeking for damages for unfair termination of the contract of employment; interest; any other re]ief the court may deem fit under the circumstances; and costs. In its answer to the complaint, the appellant asserted that the respondent wa s dismissed for dishonest conduct contrary to J4 clause 8(43) of the Employee Manual after discovery that between June, 2011 to September, 2012 he dishonestly and fraudulently paid out to himself a sum of ZMW 28,000 through cheques in his name without any value being returned to the appellant. At the trial, the respondent still denied issuing or signing the disputed cheques or receiving the purported payments. He testified that he again gave his specimen signature for submission to a handwriting expert. Instead, he received a dismissal letter. Kwaleyela Mukelabai, a prosecutor at the Drug Enforcement Commission testified as CW2 . He investigated the appellant's complaint of irregular cashing of cheques at Cavmont Bank at Mbala. He requested for the cheques and bank statements and recorded statements from signatories to the accounts. He also obtained specimen signatures and forwarded them to the handwriting forensic department. The forensic report revealed that the respondent's signature was forged. CW2 also established that Lweendo Machila (programme accountant), Simon Mumba and Joseph Lutangu prepared the disputed cheques and cashed them at the counter. The State prosecuted the three culprits for theft by servant and for money laundering and the respondent testified as a state witness. CW2 JS informed the appellant that the respondent was not involved in the forgery and the appellant should not have dismissed him. Thomas Phiri, a forensic handwriting expert testified as CW3. He examined the signature specimen and the cheques the appellant purported the respondent signed . At the trial, the court also directed him to conduct a forensic examination of the cheques exhibited in court in the respondent's name. His findings were that the disputed signatures were forged or simulated. The appellant's sole witness, Boyd Tembo (Rw 1), the Risk Manager, interrogated the respondent about the alleged fraud. The respondent denied having received any money. RWl also interviewed the bank manager who allegedly said it was not possible for a person who was not a payee to receive payment from the bank. He also agreed that the appellant dismissed the respondent because cheques were in his name and that the forensic report cleared the respondent of signing the cheques. The facts leading to the summary dismissal of the respondent from employment were common cause. The court below considered whether the dismissal of the respondent was justified. The court was satisfied that the appellant followed the correct procedure when dismissing the respondent but found that there J6 were no facts established to support the disciplinary measures taken against him and that the main reason for the dismissal was the forged cheques raised in his name. The court found it absurd that the appellant charged the respondent without verifying the disputed signatures despite the self-confessing email _ received from Lweendo Machila on 4 th September 2012 who resigned and took the blame for the financial losses and fraudulent activities at the Mbala office. The court further noted that the appellant indicated in the dismissal letter, that the fraudulent payments were made between June 2011 and September 2012 and yet, RWl conceded that the respondent moved to Kitwe on 1st April 2012, which showed that the fraudulent payments continued to be processed in his name six months after he had relocated to Kitwe. The court found unimpugned the respondent's testimony that Wesley Simwanza, a community development worker, collected one of the cheques. The court also found that the appellant acted maliciously when it engaged the services of the forensic handwriting expert after dismissing the respondent. The court held that the dismissal was unfair and awarded the respondent twenty-four months' salary as damages together with J7 interest at short-term commercial lending rate as approved by the Bank of Zambia from the date of complaint untH date of judgment and then, at 10% till fin al payment. In making the award, the court considered that courts have awarded damages from the period of notice to six months as in Zambia Privatisation Agency v James Matale 1 , to a period of twenty-four months as in Chintomfwa v Ndola Lime Com:pany2 and Chilanga Cement v Kasote Singogo 3 . Dissatisfied with the award of damages, the appellant filed this appeal arguing two grounds. The first ground attacks the award of twenty-four months' salary as damages for unfair dismissal while the second ground assails the rate of interest. The respondent concedes ground two and argues that the correct interest rate applicable from date of complaint to date of judgment is the average short-term deposit rate and thereafter, the ave rage lending rate as determined by the Bank of Zambia. Therefore, we shall allow this ground of appeal and reverse the rate of interest awarded by the court below. In respect of ground one, counsel for the appellant submits first, that the respondent served eleven months of his two year contract and remained with thirteen months before expiration , so J8 the award of twenty-four months' salary as damages for unfair dismissal 1s wrong 1n principle, and ts excessive and unconscionable. Counsel submits that there is no rational criterion and or authority for the award and that it amounts to unjust enrichment and warrants being set aside. Secondly, counsel argues that the court below erred when it simply adopted the period of two years in the Chintomfwa2 case when the facts and circumstances are different. He cites the case of Attorney-General and another v Gershom Moses Mumba4 where we stressed that when it comes to various awards the court must deal with each case on its own merit. Counsel also cites the case of Zambia National Commercial Bank Pie v Joseph Kangwa5 where we stated that: " ... , the measure of damages will vary in each particular case depending on the circumstances of the unlawful or wrongful dismis sal. We have said in some cases that some circumstances may de mand a departure from the normal measure , which is payment for the period of notice. For example in the case of Swarp Spinning Mills Pie v Chileshe and others, we held that the normal measure of damages is departed from where the termination may hav e been inflicted in a traumatic fashion which causes undue distress or mental suffering. " Thirdly, learned counsel contends that the respondent at the very latest, by the first day of trial, which was 19th September, 2013 had already found employment as a Data Specialist at Kansanshi Mine Plc but the court overlooked this vital piece of J9 evidence before making the award. It is argued that on these facts, the respondent was entitled only to the normal measure of damages at common law [which is limited to the notice periodl, which in this case, is one calendar month. In his oral submission, learned counsel for the appellant reiterated the arguments made in the heads of argument. He also drew our attention to the case of Konkola Copper Mine s Plc v Aaron Chifwembe and another6 . In that case, we said the award of damages in cases of wrongful termination is subject to a rather amorphous combination of facts peculiar to each case and that since no facts of any two cases can be identical, in applying the general principle for award of damages, one cannot expect courts to think in a regimented way. Learned counsel does not find anything traumatic in the way the appellant terminated the respondent's employment and believes that there was no malice because the cheques were in the respondent's name and the forensic report came much later. In response to the appellant's arguments, counsel for the respondent cites the case of Swarp Spinning Mills Plc v Cltilesh ,e and others7 . We said in that case that normal damages for unlawful dismissal could be departed from, where the JlO circumstances and justice demand so, and where the termination may have been inflicted in a traumatic fashion, causing undue distress or mental suffering. Counsel also cites the case of Moses Choonga v ZESCO Recreation Club, ltezhi-Tezhi8 where we awarded the appellant twelve months' pay as damages for unfair and unlawful dismissal after taking into account the manner in which the respondent treated him, in effect going beyond the one-day notice required under his previous contract of service. Counsel argues that the appellant terminated the respondent's employment in such traumatic fashion, which caused him undue distress and mental suffering, as confirmed by the way RW 1 who interrogated the respondent over the missing funds treated him with contempt implying that he stole the money. Further, that the appellant asked the respondent to explain how he had been forging the cheques without availing him the documents and disregarded the admission of the fraudulent activities by Machila Lweendo and the evidence that Wesley Simwiza collected one of the disputed cheques. Counsel argues that the appellant charged the respondent without verifying the disputed signatures and agreed to the Jll respondent's request at the disciplinary hearing for a forensic examination of the forged cheques and for CCTV footage to confirm the one drawing the funds and adjourned the proceedings, only to dismiss the respondent from employment. Additionally, the appellant reported the respondent for fraud and theft, to the Drug Enforcement Commission. The latter collected the respondent's signature specimen and subjected them to forensic examination but the appellant, ignored the forensic evidence that exonerated the respondent and refused to reinstate him. Lastly, after arresting the wrongdoers, the respondent was a state witness, at their trial [at the appellant's expense], when the appellant dismissed him from employment. Counsel submits that the fact that the respondent found a job within eleven months of the dismissal from employment does not disqualify him from an award for the mental suffering and undue distress the appellant subjected him to because the new job will not undo the ill treatment. Counsel also quotes the case of Dennis Chansa v Barclays Bank Zambia PLC9 where damages of thirty-six months' salary were awarded. In conclusion, he contends that the respondent was J12 out of employment for some time before he got employment, so damages equal to the notice period would be inadequate. In their oral submissions, learned counsel for the respondent insisted that the award of twenty-four months pay is appropriate looking at the circumstances and the way the respondent was treated and that in all fairness, the court should have awarded him damages equal to the period that remained under his con tract of employment. We have perused the judgment of the court below and the arguments by learned counsel. This appeal is only against the quantum of damages and the sole issue for decision is whether the award of twenty-four months' salary as damages for unfair dismissal is so excessive as to warrant us to interfere. In the case of Duncan Sichula and MUZI Transport Freight and Forwarding Ltd v Catherine Mulenga Chewe 10 , we held that: "An appellate court should not interfere with an award unless it was clearly wrong in some way, such as because a wrong principle has been used or the facts were misapprehended or because it is so inordinately high or so low that it is plainly a wrong estimate o f the damages to which a claimant was entitled". In the case of Bank of Zambia v Joseph Kasonde 11 , we acknowledged that dismissals based on misconduct or dishonest conduct, carry a very serious stigma with which the plaintiff cannot easily get employment especially in Zambia with a lot of unemployment and that this stigma can only be atoned by the defendants themselves. Further, in the Dennis Chansa8 case, we expressed the need for awards to increase, as the scarcity of unemployment was higher by the day because of deterioration of the global economy. In the current case, the court below took the view that :an award of twenty-four months' salary would meet the justice of the case . However, the difficulty we have, as counsel for the appellant also submitted is that the court simply adopted the period of two years in the cases of Chintomfwa v Ndola Li me Co·mpany2 and Chilanga Cement v Kasote Singogo3 without revealing its mind on why it believed that award was appropriate. We must state that in all the three cases quoted by the court below, the justification for the awards made related to the scarcity of employment. In Zambia Privitisation Agen c y v James Matale 1 , we held on the facts, that six months was a reasonable length of notice in the absence of any express terms for a first director of a very important privatisation institution and that that notice would enable the respondent to find alternative employment to mitigate his loss. In Chintomfwa v Ndola Lime Company2 , we considered that job opportunities were almost zero as well as the scarcity of the job of the kind the appellant had been doing when we awarded damages equal to two years' salary. In Chilanga Cement Plc v Kasote Singogo3 , the rationale for awarding two years' salary as damages was due to the appellant's grim future job prospects. We stressed that when the court considers each case on its own merit future job prospects may not be the only consideration for enhanced damages in wrongful or unlawful dismissal. We also declined to interfere with the award because we shared the indignation with the lower court in the harsh and inhuman way the respondent was treated. In the present case, the court below did not mention the way the appellant treated the respondent when it made the award under attack or find that the respondent suffered undue distress or mental anguish because of the way he was treated . It is learned counsel for the respondent in his arguments who gives the details of the alleged ill treatment. Nevertheless, we are satisfied that the court was aware of the circumstances that led to the dismissal of the respondent. We are also alive [from the evidence, to the way the appellant treated the JlS respondent and we agree with him that this takes the case beyond the normal measure of damages. However, the court below misdirected itself when it ignored two cardinal points, first, that the respondent was on a fixed term contract of two years and was remaining with only thirteen months on that contract. Secondly, that the respondent did not suffer from a grim future job prospect as he had mitigated his loss by finding alternative employment by the time the matter was going to trial. The period the respondent was out of employment was not a factor in the decision of the court. We agree with the appellant that it was wrong in principle for the court to reward the respondent for the rest of his contract period and beyond when he was already in employment. This amounted to unjust enrichment as he got more than what he would have earned had he served the remainder of his contract. We find that the award of twenty-four months' salary was so excessive or so extravagant that we are compelled to interfere. Accordingly, we allow the appeal and set aside that award . Instead, we award the respondent twelve months' salary as damages, as this is what meets the justice of the case. The award shall carry interest at the average of the short-term bank deposit n6 rate from date of complaint to d_ate of judgment, and thereafter at the average lending rate as determined by the Bank of Zambia. In light of Rule 44 of the l.ndustrial Relations Cou.rt Rules, Cap 269 each party shall bear own costs here and below. E. M . .1.~u:~rru SUPRE:ME COURT JUDGE ~x-- M .. MALILA SUPREME COURT JUDGE rv-~ ~ < ~~-c- - ·-R.~C. KADMA SUPREME COURT JUDGE l