Court name
Supreme Court of Zimbabwe
Case number
SC 63 of 2002
Civil Appeal 58 of 2001

Madyara v Globe & Phoenix Industries (Pvt) Ltd. t/a Ran Mine (58/01) (SC 63 of 2002, Civil Appeal 58 of 2001) [2002] ZWSC 63 (19 August 2002);

Law report citations
Media neutral citation
[2002] ZWSC 63
















REPORTABLE
ZLR (55)


Judgment
No. SC 63/02


Civil
Appeal No. 58/01








KUDA
MADYARA v





GLOBE
& PHOENIX INDUSTRIES (PRIVATE) LIMITED
t/a RAN MINE








SUPREME
COURT OF ZIMBABWE


SANDURA
JA, CHEDA JA & GWAUNZA AJA


HARARE,
JULY 8 & AUGUST 20, 2002








C
M Jakachira
, for the
appellant





R
M Fitches
,
for the respondent





SANDURA
JA: The appellant in this matter appealed against the quantum of
the damages awarded to him by the Labour Relations Tribunal
(“the
Tribunal”) as an alternative to his reinstatement as an employee of
the respondent.






The
background facts are as follows. The appellant was dismissed from
his job on 23 October 1996. He appealed to the Tribunal
in
terms of s 101(7) of the Labour Relations Act [
Chapter 28:01]
(“the Act”) and, on 28 June 2000, the Tribunal ordered as
follows:





“1. That
the respondent being in default, the appeal be and is hereby granted
with costs.







2. That the
respondent be and is hereby ordered to reinstate the appellant
without any loss of salary or benefits with effect from
the 23
rd
of October 1996, being the date of dismissal.






ALTERNATIVELY:





3. That
the appellant be and is hereby awarded damages in lieu of
reinstatement, the quantum of which is to be assessed by the
Tribunal.





4. That
the amount is to be paid together with interest at the prescribed
rate of interest with effect from the date of dismissal.”





When
the appellant was not reinstated, he approached the Tribunal for the
quantification of his damages and, on 9 February
2001, the
Tribunal ordered the respondent to pay to him damages in lieu of
reinstatement in the sum of $162 674.63, together
with interest
and costs of suit. The respondent was again in default on that
occasion.





Dissatisfied
with the quantum of damages awarded to him, the appellant appealed to
this Court.





The
first issue to deal with is whether this appeal raises any question
of law because, in terms of s 92(2) of the Act, an
appeal from
the Tribunal lies to this Court only on a question of law. A ruling
by the Tribunal on the quantum of damages is a
ruling on fact unless
it is wholly unreasonable.






As
McNALLY  JA said in
Leopard
Rock Hotel Company (Private) Limited v Van Beek

2000 (1) ZLR 251 (S) at 256 B-C:






“A ruling by the Tribunal on
damages is a ruling on fact and thus not appealable unless it can be
categorised as wholly unreasonable.
This may (but not must) be the
situation where the Tribunal has misdirected itself on the law as to
the criteria to be taken into
account in assessing damages.”






In
the present case, I have no doubt that in assessing the damages
payable to the appellant the Tribunal misdirected itself because
it
disallowed the appellant’s claim in respect of back-pay. The
matter is, therefore, properly before the Court.





The
sum of $162 674.63, which was awarded to the appellant, was
assessed on the basis that the period within which the appellant
could not reasonably have been expected to find alternative
employment was three years from the date of his dismissal. The sum
was made up as follows:





Net
salary for three years: $134 156.76


Rentals:
$23 450.00


Electricity
bills: $5 067.87


___________


TOTAL: $162 674.63


___________
.





The
appellant’s claims for back-pay from October 1996 to July 2000 and
for underground allowances and water bills were disallowed.
In
addition, the amounts claimed by the appellant in respect of rentals
and electricity bills were reduced to the amounts shown
above because
those were the amounts proved by documentary evidence.





The
appellant’s claims in respect of rentals, electricity and water
bills were based on the fact that before his dismissal the
appellant
was entitled to free accommodation, which included free water and
electricity.





The
real issue in this appeal is whether, in addition to the sum awarded
to him as damages in lieu of reinstatement, the appellant
is entitled
to back-pay and benefits from 23 October 1996, when he was
dismissed, to 28 June 2000, when the Tribunal ordered
that he be
reinstated or paid damages.





In
determining that issue, the starting point is the order issued by the
Tribunal on 28 June 2000, which I have already set
out at the
beginning of this judgment. The Tribunal ordered the respondent to
reinstate the appellant “without any loss of salary
or benefits
with effect from the 23
rd
of October 1996” or, alternatively, pay him damages in lieu of
reinstatement.





Recently,
I commented on a similarly worded order in
Oliver
Chiriseri and Anor v Plan International

SC-56-2002 (not yet reported). At p 6 of the cyclostyled
judgment I said:





“It
is clear from the wording of the order that if the appellants had
been reinstated they would have been entitled to back-pay and
benefits. … I say so because the order makes it clear that the
reinstatement is to have a retrospective effect.





As
this Court stated in
Chegutu
Municipality v Manyora

1996 (1) ZLR 262 (S) at 268 A-B:





‘…
the word “reinstate” or
“reinstatement” carries no automatic retrospective connotation,
either in ordinary language or in
our legislation. Normally it
means simply that the person concerned will be placed again in
his/her former job. If retrospectivity
is intended, one would
normally look for additional words such as “with effect from the
date of dismissal” or “with effect
from (a particular date in the
past)” or “with back-pay and all benefits from … (date)”.’





Applying
that test to the order of reinstatement issued by the labour
relations officer … it is clear that retrospectivity was intended.
…





In
my view, where the order of reinstatement indicates that
retrospectivity was intended, the damages to be paid in lieu of
reinstatement
must include back-pay and benefits.”





Those
comments apply to the present case with equal force. As far as
back-pay and benefits are concerned, there is no cogent reason
for
distinguishing between an employee who is reinstated and one who is
not, where the order of reinstatement has a retrospective
effect.
In my view, both of them are entitled to back-pay and benefits. The
only difference between them is that one gets his
job back whilst the
other is paid damages for the premature termination of his employment
contract.





Commenting
on the relationship between back-pay and damages, McNALLY  JA
said the following in

Leopard Rock Hotel Company (Private) Limited v Van Beek supra

at 254H-255A:





“… it
seems to me that ‘back-pay’ and ‘damages’ are indeed
different concepts, but only in the sense that ‘damages’ is a
wider concept. It will normally include back-pay, but may include,
for example, compensation for loss of promotion prospects, interest,
and other elements as appropriate.”





I
entirely agree with those comments.





Later
on in the judgment the learned JUDGE OF APPEAL said the following at
255H-256A:





“’Back-pay’
is thus a concept associated with reinstatement. If an employee is
reinstated she will normally be awarded back-pay.
If she succeeds
in proving wrongful dismissal, but is not reinstated, she will be
entitled to ‘damages’, a major element of
which will be back-pay.
Perhaps, more correctly, one should say the damages will be
assessed by reference to the back-pay lost.
But here the back-pay
will be limited to a period from the date of wrongful dismissal to a
date by which she could, with reasonable
diligence, have obtained
alternative employment.”





Again,
I agree with those comments. However, the comment that “the
back-pay will be limited to a period from the date of wrongful
dismissal to a date by which she could, with reasonable diligence,
have obtained alternative employment” must be interpreted in
the
context of the facts of that case, which are set out at p 252 E-F
as follows:





“The
appellant (‘the hotel’) employed Ms van Beek as a bookkeeper
from 7 June 1993 to 4 January 1995 on which date
she was
suspended pending approval of her dismissal by a labour relations
officer (‘LRO’).





Dismissal
was approved by the LRO and by a senior labour relations officer
(‘SLRO’). The Labour Relations Tribunal (‘the
Tribunal’)
reversed their decisions and ordered reinstatement or damages. It
transpired that she had found alternative employment
in January 1997.
The Tribunal awarded her back-pay for twenty-four months which was
calculated (by consent) to be $287 138.89.”





By
taking alternative employment in January 1997 Mrs van Beek,
instead of standing by her contract of employment and enforcing
her
rights against the hotel, elected to accept the repudiation of her
contract and terminated it. She could not, therefore, seek
reinstatement, but could only claim damages.





Commenting
upon an employee who had elected to terminate his contract of service
by taking alternative employment whilst on suspension,
GUBBAY  JA
(as he then was) said the following in
Zimbabwe
Sun Hotels (Private) Limited v Lawn

1988 (1) ZLR 143 (S) at 153 A-B:





“But
I am inclined to go further and hold positively that the respondent
was shown on the probabilities to have elected to terminate
his
contract of service in reliance upon the appellant’s breach in
suspending him without pay. His remedy therefore lay in delict
and
not in contract, but I express no view as to whether or not he might
succeed in a claim for damages, since altogether different
considerations will apply.”





In
my view, those comments apply with equal force to Mrs van Beek.





In
the circumstances, Mrs van Beek’s position is very
different from that of an employee, like the present appellant,
who
has not elected to accept the repudiation of his contract of
employment, and in respect of whom the Tribunal has ordered
“reinstatement
with effect from the date of dismissal with back-pay
and all benefits or, alternatively, damages”. In my view, the
comment by
McNALLY  JA would not apply to the calculation
of damages in lieu of reinstatement payable to such an employee.





Before
leaving the issue of back-pay and benefits, I would like to clarify
this Court’s decision in
Ambali
v Bata Shoe Company Limited

1999 (1) ZLR 417 (S) (Ambali’s second appeal), criticised by
counsel for the appellant in his heads of argument. Ambali was not
awarded back-pay and benefits for the period during which he was on
suspension for the simple reason that the order of reinstatement
issued in his favour did not have a retrospective effect. It simply
stated that Ambali was to be reinstated. It did not say that
he was
to be reinstated “with effect from the date of suspension” or
“with back-pay and all benefits”. See
Charles
Ambali v Bata Shoe Company Limited

SC-100-98 (not reported) at p 2 of the cyclostyled judgment
(Ambali’s first appeal).





Having
said that, I would like to consider the benefits to which the present
appellant was entitled, in addition to his salary.
They were two.





The
first benefit was an underground allowance. In terms of clause 20
of the Collective Bargaining Agreement: Mining Industry
(General
Conditions) 1990, published in Statutory Instrument 152 of 1990, the
appellant, being an employee working underground, was
entitled to an
underground allowance equal to three per centum of his basic salary.
Had he not been unlawfully dismissed, that
allowance would have been
paid to him every month. He is, therefore, entitled to it from
23 October 1996, the date of his
dismissal, to 28 June
2000, when the Tribunal ordered the respondent to reinstate him
without loss of salary or benefits with
effect from the date of
dismissal. The fact that during that period he was not working
underground is irrelevant, because he had
been unlawfully prevented
from working by the respondent.





The
second benefit to which the appellant was entitled was free
accommodation, which included free water and electricity. In this
regard, the appellant ought to have produced evidence showing how
much it cost him to rent a house of the same standard as the one
which had been provided to him free of charge, and the cost of water
and electricity incurred whilst occupying such a house during
the
relevant period. Regrettably, no such evidence was produced, apart
from receipts showing that during the relevant period the
appellant
paid rentals totalling $23 450.00, and electricity bills
totalling $5 067.87.





However,
as the two amounts have not been challenged on appeal, there is no
basis for interfering with the Tribunal’s awards in
respect of the
costs of alternative accommodation and electricity. No documentary
evidence was produced in respect of the water
consumed during the
relevant period. The appellant was not, therefore, entitled to any
award in that respect.





I
now wish to deal with the mitigation of damages. It is well
established that an employee who considers that he has been dismissed
unlawfully should mitigate his damages by taking temporary
employment. See, for example,
Gauntlet
Security Services (Private) Limited v Leonard

1997 (1) ZLR 583 (S) at 586 C-G and
Ambali
v Bata Shoe Company Limited supra

at 419 A-B.





In
the present case, the Tribunal found that the appellant did not do
anything to mitigate his damages. However, the burden of
showing
that the appellant earned or ought to have earned some money during
the relevant period rested on the respondent.





Thus,
in
Nyaguse v Mkwasine
Estates (Private) Limited

2000 (1) ZLR 571 (S) at 575 C-D this Court said:





“But
at the same time it must be borne in mind that the
onus
is on the employer to show that the employee has, or should have,
earned an income from some other source. If the Tribunal is forced
to make an estimate, it must use the information to hand, and not
simply pluck a figure from nowhere.”





As
the respondent was in default on 28 June 2000, when the appeal
was heard by the Tribunal, and on 6 February 2001, when
the
application for the quantification of the appellant’s damages was
heard, the
onus
of showing that the appellant earned or should have earned some
money, and how much he earned or should have earned, during the
relevant
period was not discharged. In any event, it was not argued
on behalf of the respondent that the appellant should have mitigated
his losses. On the contrary, it was submitted that the assessment
of the appellant’s damages was fair and reasonable, a submission
with which I disagree.






Consequently, on the basis of
the appellant’s net salary figures, produced to and accepted by the
Tribunal, the appellant is entitled
to the following:






(a) Three
years’ net salary, being damages in lieu of
reinstatement: $137 676.76



(b) Net
back-pay from November 1996 to June 2000: $197 678.44



(c) Underground
allowance (3% of back-pay): $5 930.35



(d) Rentals:
$23 450.00



(e) Electricity:
$5 067.87




__________


TOTAL: $369 803.42



__________






In the circumstances, the
following order is made –






1. The appeal is allowed with
costs.






2. The order issued by the
Tribunal on 9 February 2001 is set aside and the following is
substituted:







“(a) That the respondent shall
pay to the applicant the sum of $369 803.42 together with
interest at the prescribed rate from
9 February 2001 to the date
of payment in full.







(b) That the respondent shall
bear the applicant’s costs.”


















CHEDA  JA: I
agree.



















GWAUNZA  AJA: I
agree.

















Jakachira
& Company
,
appellant’s legal practitioners



Gill, Godlonton & Gerrans,
respondent’s legal practitioners