Court name
Supreme Court of Zimbabwe
Case number
SC 6 of 2004
Civil Appeal 210 of 2002

Merchant Bank of Central Africa v Dube (10/02) (SC 6 of 2004, Civil Appeal 210 of 2002) [2004] ZWSC 6 (11 February 2004);

Law report citations
Media neutral citation
[2004] ZWSC 6



















REPORTABLE
(ZLR) (3)


Judgment
No. SC 6/04


Civil
Appeal No. 210/02








MERCHANT
BANK OF CENTRAL AFRICA





v
JAMES DUBE








SUPREME
COURT OF ZIMBABWE


SANDURA  JA,
CHEDA JA & GWAUNZA JA


HARARE,
JANUARY 29 & FEBRUARY 12, 2004








J
B Colegrave
, for the
appellant





S
V Hwacha
for the
respondent





SANDURA  JA:
This is an appeal against a judgment of the Labour Relations
Tribunal (now the Labour Court) which ordered
the appellant (“the
bank”) to reinstate the respondent (“Dube”) in his position as
a clerk without loss of salary and benefits
from the date of his
dismissal.





The
factual background is as follows. Dube was employed by the bank as
a clerk in the customer services department. On 9 December
1998 he commenced temporary relief duties at the travellers’
cheques and foreign currency desk (“the desk”). He had been
employed by the bank for about seven years and, during that time, had
manned the desk in 1995, 1996, 1997 and in July and October
1998 for
various periods.





On
21 December 1998, Dube received a telephone call from a person
who informed him that he was calling from the International
Bureau de
Change (“the bureau”), and that the bureau intended purchasing
from the bank US$10 000.00 in notes. Having said
that, he
asked Dube to outline the procedure to be followed in buying the
foreign currency. In reply Dube informed him that the
bureau was to
deposit into the bank’s account at Stanbic Bank Zimbabwe Limited
(“Stanbic”) the local currency equivalent in
cash amounting to
$375 797.50, and that upon the production of the cash deposit
slip he (i.e. Dube) would release the foreign
currency to the bureau.
To facilitate the transaction, Dube gave the caller the bank’s
account number at Stanbic.





Thereafter,
Dube completed a “Request For Issue of Travellers Cheques/Notes”
(“the requisition”) which indicated that the
bureau was
purchasing US$10 000.00 from the bank. He was supposed to pass
the requisition on to the checking clerk who would
have checked the
figures and the identity of the bureau, but he did not do so because
the checking clerk was not at his desk. In
the absence of the
checking clerk, Dube took the requisition to an official referred to
as the custodian, but did not inform him
that it had not been checked
by the checking clerk. The custodian then released the US$10 000.00
to Dube, who later gave it
to a man who had presented to him a cash
deposit slip indicating that the sum of $375 797.50 had been
deposited into the bank’s
account at Stanbic.





Before
handing over the foreign currency, Dube did not check with Stanbic to
confirm that the money had been deposited into the
bank’s account.
He did not contact the bureau to confirm that the man collecting the
foreign currency was doing so on its behalf.
And he did not ask the
man to identify himself. The man was a complete stranger to him.





It
subsequently turned out that the deposit slip presented to Dube was
not a genuine one and that no money had been deposited into
the
bank’s account at Stanbic. In the circumstances, the bank was
defrauded of the sum of US$10 000.00.





As
a result, on 20 January 1999 Dube was charged with two acts of
misconduct in terms of the bank’s Code of Conduct (“the
Code”),
which is set out in Statutory Instrument 201 of 1995. The first was
failure to comply with standing instructions or follow
established
procedures resulting in substantial loss to the bank, and the second
was gross negligence causing serious loss to the
bank. On the same
day, he was suspended from duty on full pay until further notice.





About
a week later, a third act of misconduct was added and Dube was
informed. The third act of misconduct was a serious act,
conduct or
omission inconsistent with the fulfilment of the express or implied
conditions of his contract. In terms of the Code,
the penalty for
each of the three acts of misconduct was dismissal.





On
29 January 1999 a disciplinary hearing was conducted and Dube
was subsequently found guilty of all the three charges and
was
dismissed with effect from 12 March 1999. He appealed to a
body referred to as the grievance and disciplinary committee,
but
that committee was evenly divided. The two employer’s
representatives were of the view that Dube was guilty of all the
charges,
whilst the two employee’s representatives concluded that
he was not guilty of the charges.





The
matter later went to the appeals board (“the board”), which
concluded that Dube had been improperly charged with the three
acts
of misconduct. The board was of the view that he should only have
been charged with failure to comply with standing instructions.
It
found him guilty of that charge and imposed the penalty of a first
written warning.





The
bank then appealed to the Labour Relations Tribunal (now the Labour
Court) which set aside the disciplinary proceedings on the
ground
that the presence at the initial disciplinary hearing of a
Mr Brunette (“Brunette”), described in the minutes as
a
consultant, vitiated the proceedings. Aggrieved by that decision,
the bank appealed to this Court.





The
first issue I wish to deal with is the effect of Brunette’s
presence at the initial disciplinary hearing. The Code makes
no
provision for the presence of a consultant at such a hearing. In
addition, it is clear from the minutes of the hearing that
Brunette
was not a silent observer. The relevant part of the minutes reads
as follows:






“Mr Brunette
highlighted and verified the specific areas in the Bank’s
Disciplinary Code that Mr Dube had breached

as being Category ‘D’ offences … as follows –






  • Failure
    to comply with standing instructions or follow established
    procedures resulting in substantial loss to the Bank -
    Paragraph 11.17;







  • Gross
    negligence causing serious loss to the Bank – Paragraph 11.15;
    …










  • Mr
    Dube committed a serious act, conduct or omission inconsistent with
    the fulfilment of the express or implied conditions of his
    contract
    of employment; …







Mr Chikuhwa queried the
third allegation of misconduct, to which
Mr Brunette
explained that Mr Dube’s breach of an implied condition of his
contract of employment (was) due to his negligent
failure to follow
written down procedures

(emphasis added)





The
minutes indicate that it was subsequently suggested by the bank’s
representative that Brunette had been at the hearing in
order to
explain the charges and clarify legal procedures. I find that
explanation unacceptable. That is so because what Brunette
said
went beyond explaining the charges. He was in fact saying that Dube
had committed the three acts of misconduct. The extent
to which
such a statement may have influenced the hearing officer is not
known.





In
any event, the Code makes no provision for the presence of a
consultant at the hearing. Mr Brunette’s presence at the
hearing was, therefore, impliedly forbidden and irregular.






In Minerals
Marketing Corporation v Mazvimavi

1995 (2) ZLR 353 (S), this Court dealt with a situation similar to
the one in the present case. A Mr Sibanda, the human resources
manager, had attended the disciplinary hearing when, in terms of the
company’s Code of Conduct, he was not supposed to attend.
At
362 C-E GUBBAY  CJ said:





“Nonetheless,
it is certain that Mr Sibanda was not present merely as an
observer. The minutes reflect that he was permitted
to put
questions to and make statements concerning the respondent, although
the occasions on which he did so were few. … What
is plain is
that in allowing Mr Sibanda to be present, in a capacity other
than a silent observer, the disciplinary committee
went beyond the
parameters of the Code. It was an act impliedly forbidden. Thus a
procedural irregularity occurred which, if
not vitiating the
proceedings, rendered them voidable at the instance of the
respondent. … The irregularity was calculated to
prejudice the
respondent and was not shown by the corporation not to have caused
any prejudice.”





Although
it appears that Sibanda played a more active part at the disciplinary
hearing than Brunette, I think that the comments
made by GUBBAY  CJ
in the
Minerals
Marketing
case supra
apply to the present case with equal force. Brunette was not a mere
observer. On the contrary, he made statements indicating
that Dube
had committed the alleged acts of misconduct. Such statements were
calculated to prejudice Dube and were not shown not
to have done
that. In the circumstances, Brunette’s presence and participation
at the hearing vitiated the proceedings.





However,
that is not the end of the matter. In my view, the Tribunal should
not have determined the matter on the basis of the
procedural
irregularity. It should have either determined the matter on the
merits or remitted it for hearing
de novo.
As McNALLY  JA said in
Dalny
Mine v Banda
1999 (1)
ZLR 220 at 221 B-D:





“As
a general rule it seems to me undesirable that labour relations
matters should be decided on the basis of procedural irregularities.

By this, I do not mean that such irregularities should be ignored.
I mean that the procedural irregularities should be put right.
This
can be done in one of two ways –





(a) by
remitting the matter for hearing
de novo
and in a procedurally correct manner;





(b) by
the Tribunal hearing the evidence
de novo.





In
regard to the first of these alternatives, this Court has previously
said that:





‘The
Tribunal is not given a discretion whether to remit or not. Once it
decides that the proceedings were fatally irregular, and
it cannot
come to a conclusion on the merits, it has no choice but to remit.’





See
Air Zimbabwe Corp. v
Mlambo
1997 (1) ZLR
220 (S) at 223F, and s 101(8) of the Act.”





In
the present case, the Tribunal could, and did in fact, come to a
conclusion on the merits. It found that Dube’s negligence
was
ordinary and not gross, and set aside the proceedings on the ground
that they were vitiated by Brunette’s presence and participation
at
the hearing. It then dismissed the bank’s appeal, which it
should not have done, and indicated that the bank was at liberty
to
institute fresh disciplinary proceedings against Dube. That was
unnecessary because the Tribunal had already made a determination
on
the merits.





Having
said that, I now proceed to deal with the second and main issue in
this matter, which is whether Dube was guilty of gross
negligence.
I have no doubt in my mind that he was.





Although
gross negligence is incapable of precise definition, an entire
failure to give consideration to the consequences of one’s
actions
or omissions, or a total disregard of one’s duty would constitute
gross negligence. See
Bickle
v Joint Ministers of Law and Order

1980 ZLR 36 (GD) at 41 A-C.





As
already stated, Dube commenced temporary relief duties at the
travellers’ cheques and foreign currency desk on 9 December
1998. That was not the first time for him to man that desk. He
had been employed by the bank for seven years and had manned the
desk
in 1995, 1996, 1997 and in July and October 1998 for various periods.
He must, therefore, have been familiar with the procedures
to be
followed in the execution of his duties.





In
addition, on 15 May 1998 and 24 August 1998 the bank
circulated memoranda to all the clerical staff in the customer
services department, the department where Dube worked, reminding them
to guard against fraud. It was common cause that Dube saw
both
memoranda and that his initials appear on both documents. A
paragraph in the memorandum issued on 24 August 1998 reads
as
follows:





“Please
note that in a volatile exchange market the tendency is for clients
to avoid their obligations depending on circumstances,
and this could
result in the bank losing money which is a situation which all of us
must try to avoid.”





However,
notwithstanding such reminders, on 21 December 1998 Dube
completely failed to give consideration to the consequences
of his
actions and omissions. In the first place, after preparing the
requisition he did not pass it on to the checking clerk,
who would
have checked the identity of the bureau and discovered that the
bureau was not one of the four which the bank dealt with.
His
explanation for not passing the requisition on to the checking clerk
was that the clerk was not at his desk. However, as
the caller had
not requested him to attend to the transaction as a matter of
urgency, there was no reason for not waiting for the
clerk to return
to his desk. Instead, he took the requisition to the custodian but
did not inform him that it had not been checked
by the checking
clerk.





Secondly,
when the cash deposit slip was presented to him he did not check it
in order to satisfy himself that it was genuine.
Had he done so, he
would have discovered that it did not bear a teller’s stamp and the
initials of the teller who had received
the cash. He would have
discovered that the stamp on the deposit slip was that of the waste
department, a department which does
not deal with cash deposits.
And he would have noticed that the cash deposit slip did not indicate
that the various amounts, totalling
$375 797.50, had been
checked, found correct and ticked off in accordance with the usual
bank practice.





Thirdly,
Dube handed over the US$10 000.00 to a complete stranger without
requiring him to identify himself and taking down
his identification
particulars. He did not ask the stranger to produce proof of his
authority to collect the money on behalf of
the bureau, and he did
not contact Stanbic to confirm that the sum of $375 797.50 had
been deposited into the bank’s account.
In addition, he did not
contact the bureau to confirm that the stranger had been sent by the
bureau to collect the foreign currency.





In
my view, the cumulative effect of all these factors leads to the
inescapable conclusion that Dube was guilty of a complete dereliction
of duty and was grossly negligent. His negligence caused a serious
loss to the bank.





In
the circumstances, the following order is made –





1. The
appeal is allowed with costs.






2. The order of the Labour
Relations Tribunal is set aside and the following is substituted –





“It
is declared that the respondent was lawfully dismissed.”








CHEDA
JA: I agree.














GWAUNZA
JA: I agree.














Atherstone
& Cook
,
appellant's legal practitioners


Dube,
Manikai & Hwacha
,
respondent's legal practitioners