Harold S. Ndulwa and Ors v Zambia Sugar Plc (Appeal No. 300/2023) (2 May 2024) – ZambiaLII

IN THE COURT OF APPEAL OF ZAMBIA Appeal No. 300/2023 HOLDEN AT LUSAKA (Civil Jurisdiction) BETWEEN: 1 APPELLANT ST JUDITH MAINZA APPELLANT 2ND HASTINGS MAUMBI 3RD APPELLANT BORNFACE CHIWOTA APPELLANT 4TH ROCKON NGANDU APPELLANT 5TH JAMES MAKUMBA APPELLANT 6TH DECKSTER SISHEKANU APPELLANT 7TH JUDITH MAINZA (see list attached to the Originating Summons) gTH - 96TH APPELLANT AND ZAMBIA SUGAR PLC RESPONDENT Coram: Kondolo, Majula and Banda-Bobo, JJA On 28th March 2024 and 2nd May, 2024 For the Appellants Mr Lisimba, Mr. S. Mambwe & Mr. A. Siwila, of Messrs Mambwe Siwila & Lisimba Advocates. For the Respondent Mr. M. Nchito SC, Mrs N. Simachela & Mr. C. Hamwela, of Nchito & Nchito Advocates JUDGMENT J2 MAJULA JA, delivered the Judgment of the Court. Cases referred to: 1. Wilson Masauso Zulu us Avondale Housing Project Limited (1982) ZR 175. 2. Nkhata & Others us The Attorney-General (1966) ZR 124. 3. Citibank Zambia Limited us Suhayl Dudhia SCZ Appeal No. 6 of 2022. 4. P. C. Cheelo & 9 Others us Zambia Consolidated Copper Mines Limited SCZ Judgment No.13 of 2019. 5. Bric Bank Limited T/ A Gamwe Ranches us Neil Kirkpatrick 2021/ CCZ/ 0002. 6. GDC Logistics Zambia Limited us Joseph Kanyanta & 13 Others SCZ Judgment No.17 of 2017. 7. Zambia National Commercial Bank Plc us Martin Musonda & 58 Others SJ No. 24 of 2018. 8. Cosmas Mukuka (Sued in his capacity as Secretary General of Zambia Congress of Trade Unions) us Mwanza (Suing in his capacity as General Secretary of University ofZ ambia Lecturers and Researchers Unions) SCZ Appeal No. 99 of 2016. 9. Caumont Bank Limited us John Mwansa Kalinde & 40 Others CAZ Appeal No. 309/ 2021 10 Axiz (Pty) Limited us Cloudtech Zambia Limited & Another CAZ Appeal No. 221/ 2020 11 Mubita Mwananuka us Armaguard Security Limited CAZ Appeal No. 201/ 2021 12 Scherer us Country Investments Limited (1986) 1 WLR 615 13 Matale James Kabwe us Mulungushi Limited, SCZ Appeal No. 90/ 1996. Legislation referred to: 1. Constitution of Zambia (Amendment) Act No 2 of 2016 2. Industrial and Labour Relations Act, Chapter 269 of the Laws of Zambia 3. Employment Code Act, No. 3 of 2019 J3 4. The High Court Rules, Chapter 27 of the Laws of Zambia Other authorities referred to: 1. Dr. Winnie Sithole Mwenda and Chanda Chungu (2021) A Comprehensive Guide On Employment Law In Zambia. UNZA Press: Lusaka. 1.0 Introduction 1. 1 The appeal emanates from a ruling of the High Court dated 25th July, 2023 delivered by the Honourable Lady Justice M. Wina. The appeal interrogates the issue whether the High Court (General List) has jurisdiction to deal with industrial relations disputes affecting the rights and obligations of employers and employees. 2.0 Background 2. 1 The facts preceding the appeal before us were that the appellants commenced an action by way of originating summons against the respondent on 15th May, 2023. The originating process was filed in the Principal Registry of the High Court for Zambia and was made pursuant to Order 6 Rule 3 and Order 30 Rule 1 l(b) and (c) of the High Court Rules, Chapter 27 of the Laws of Zambia. 2.2 In the pleadings that were presented to court, the appellants were seeking an interpretation of sections 54 (1) (d) and 55 (3)(a) of the Employment Code Act No. 3 of 2019 in J4 relation to the conditions of service under their collective agreement. 2.3 On 6th June, 2023, the respondent vehemently contested the validity of the court process and applied to have the matter dismissed for want of jurisdiction. They contended that the alleged underpayments of their redundancy packages were governed by a negotiated Collective Agreement whose challenge fell under the jurisdiction of the Industrial and Labour Relations Division of the High Court. 3.0 Decision of the Lower Court 3.1 The learned trial Judge examined the evidence and the submissions of the parties and proceeded to make a finding that the relationship that existed between the parties was that of employer and employee. That the nature of the dispute that arose was of an industrial relations nature whose jurisdiction lies exclusively with the Industrial Relations Division of the High Court. 3.2 The lower court was further of the view that the creation of the Industrial Relations Division of the High Court was to ensure that all Industrial Relations matters between employees and employers are dealt with exclusively by that Court to avoid congesting the general list. 3.3 Ultimately the court below dismissed the action for want of jurisdiction and irregularity. JS 4.0 Grounds of Appeal 4.1 Disconsolate with the outcome, the appellants filed a notice of appeal anchored on six (6) grounds of appeal set out below: "1 The court below erred in law and in fact when it found as a fact that the relationship that exists between the respondent and the appellants was that of the Employer and Employee. 2 The court below erred in law and in fact when it held that the nature of the dispute is an Industrial Relations matter thus the Industrial Relations Court has sole jurisdiction over the same. 3 The court below erred in law and fact when it held that the interpretation of the provisions contained in the Employment Code Act No. 3 of 2019 was the exclusive preserve of the Industrial Relations Court. 4 The Court below erred in law and in fact by dismissing the matter for want of jurisdiction and irregularity when the High Court is legally mandated to interpret statutes. 5 Alternatively, the Court below erred in law when it dismissed the matter for lack ofj urisdiction when it could have transferred same to the appropriate Divisions of the High Court. 6 The Court below erred in the law when it awarded costs against the appellants." J6 5.0 Appellant's Arguments 5.1 The gist of the appellants' submission in ground 1 is that there is no evidence to support the finding by the lower court that there is a relationship of employer and employee between the parties. That the finding of the lower court to that effect was perverse and not supported by the evidence. This entails that this court is entitled to reverse the findings on the basis of the cases of Wilson Masauso Zulu vs Avondale Housing Project Limited1 and Nkhata & Others vs The Attorney General2. 5.2 Moving on to ground 2, the appellants submitted that the case before us cannot be termed as an Industrial Relations matter which falls under the exclusive jurisdiction of the Industrial Relations Court. The appellants' claims as set out in the originating summons is for the interpretation of a redundancy situation. They are not seeking interpretation of a collective agreement. 5.3 It is the position of the appellant that following their separation from the respondents, they are before court to recover the balance of the redundancy benefits. 5.4 Pertaining to grounds 3 and 4, the appellant stoutly asserted that the High Court general list has jurisdiction to interpret statutes in line with Order 30 Rule 11 (c) of the High Court Rules. To strengthen the argument, the case of Citibank Zambia Limited vs Suhayl Dudhia3 was called in aid where J7 it was held, inter alia, that Parliament makes laws while the Judiciary interprets them. 5.5 With regard to ground 5, the kernel of the appellants' submission was that section 23 (1) and Order 19 Rule 3(1)U) of the High Court Rules confer authority on Judges of the High Court to transfer matters in the general list which have been filed wrongly to the correct division. That when the court below found as a fact that the Industrial Relations Division was better placed to deal with the matter, it should have transferred the case and not dismiss it. 5.6 In closing, Counsel urged us to reverse the order for costs on the basis that the matter was properly before court. 6.0 Respondents' Arguments 6.1 In relation to ground 1, the respondent avowed that the learned Judge was on firm ground when she found that the relationship that had existed between the parties was that of employer and employee. That the court's use of the word 'was' means that an employer/ employee relationship existed in retrospect. It was contended that the appellants therefore misconstrued that finding of the court below. 6.2 Thus there is no reason for this court to set it aside as the court below acknowledged that the relationship was terminated when the appellants were declared redundant. J8 6. 3 The response to ground 2 was that the court below was on terra .firma when it held that the nature of the dispute is an Industrial Relations matter and the Industrial Relations Division has sole jurisdiction over the same. That the appellants sought interpretation of sections 54 (1) (d) and 55 (3) (a) of the Employment Code Act in terms of their Collective Agreement upon which payment of their redundancy benefits was made. Counsel referred us to section 85 of the Industrial and Labour Relations Act which clothes the Industrial Relations Court Division with original and exclusive jurisdiction to hear and determine industrial relations matters as they relate to Collective Agreements. To augment the point, we were referred to the cases of P.C. Cheelo & 9 Others vs Zambia Consolidated Copper Mines Limited4 and Bric Bank Limited T/A· Gamwe Ranches vs Neil Kirkpatrick5 where the import of section 85 of the Industrial Relations Court Act was extensively discussed. 6.5 In countering grounds 3 and 4 the respondent averred that the jurisdiction to decide the appellant's claims is vested exclusively in the Industrial Relations Court Division of the High Court and not the general list. That a look at their claims shows that the appellants' intention is to force a recalculation of their redundancy packages by impugning the Collective Agreement that governed the employment relationship. Consequently, that the lower court was on firm J9 ground when it found that it lacked jurisdiction to hear and determine the matter. 6.6 The submissions in ground 5 were that based on the decisions of the Supreme Court in the cases of GDC Logistics Zambia Limited vs Joseph Kanyanta & 13 Others6 and Zambia National Commercial Bank Plc vs Martin Musonda & 58 Others, 7 the Industrial Relations Division is not amenable to the provisions of the High Court Act, but maintains its distinct character and specialization. That this entails that re-allocation or transfer was not within the High Court's power as contended by the appellants. 6. 7 In relation to costs, the respondent maintained that the Order for costs followed the event in that the matter was wrongly before the general list. 7.0 Hearing of the Appeal 7.1 When the matter came up for hearing on 28th March 2024, learned Counsel for both parties sought to rely on their written heads of argument but also made brief oral submissions by way of emphasis. 7.2 On behalf of the appellants, Mr Lisimba's argument was that where there is no longer an employment relationship between the parties and a party is claiming for payment of what they consider is outstanding, the High Court (General List) still retains jurisdiction to hear matters involving a pure master JlO and servant relationship. He sought refuge in the cases of Cosmas Mukuka (Sued in his capacity as Secretary General of Zambia Congress of Trade Unions) vs Mwanza (Suing in his capacity as General Secretary of University of Zambia Lecturers and Researchers Unions)8 and Cavmont Bank Limited vs John Mwansa Kalinde & 40 Others9 • 7.3 On that basis, he implored this Court to reverse the ruling of the lower court. 7.4 In response, State Counsel M. Nchito, asserted that there is no procedure for claiming a debt by way of originating summons as was the case in casu. That the only exeception is with respect to mortagae actions. 7.5 He contended further that the matter before the lower court had to do with a collective agreement pursuant to which the employees who were declared redundant were paid. State Counsel avowed that the appellants' are seeking to impugn a collective agreement. The kernel of his argument was that in terms of section 85(1) and (9) of the Industrial and Labour Relations Court Act, issues to do with collective agreements are matters that fall under the exclusive jurisdiction of the Industrial Relations Division of the High Court. 7 .6 On the issue of costs, Mr Hamwela Co-Counsel, beseeched this Court to order that costs should abide the decision of the court below, in the event we are of the view that the General J 11 Division of the High Court has jurisdiction to determine the matter. For this proposition, Mr Hamwela cited the case of Axiz (pty} Limited vs Cloudtech Zambia Limited & Another10 • 7.6 In reply, Mr. Mambwe averred that the reliefs being sought in the High Court have nothing to do with interpretation of a collective agreement. He reiterated that the question put to the court below was whether, fallowing the declaration of redundancy, the appellants should be paid pursuant to either section 54 or 55 of the Employment Code Act as shown in their pleadings. That the questions that the appellants have are supposed to be determined by originating summons pursuant to Order 30 Rule 1 l(b) of the High Court Rules. It was his position that the High Court has jurisdiction to determine this matter. 8.0 Decision of this Court 8. 1 We have considered the record of appeal and the rival arguments from counsel for both parties. We shall deal with ground 1 separately. Grounds 2, 3 and 4 are intertwined as they seek to assail the decision of the court on the basis that it lacked jurisdiction and will therefore be dealt with together. Ground 5 is in the alternative and shall be dealt with separately. We shall thereafter deal with the 6th ground, which is on costs. J12 9.0 Employer/Employee Relationship 9.1 In the 1st ground, the contention by the appellant is simply that the lower court was wrong to have made a finding that an employer/employee relationship existed. We have examined the basis upon which the appellants had approached the lower court. It is plain to see that they sought vanous reliefs emanating from the relationship that had existed prior with the respondent. Their claims were predicated on the fact that they had been employees of the respondent and had subsequently been declared redundant. This can be gleaned from the originating summons that had been filed (s ee pages 18 to 19 of the record of appeal 'ROA') where the questions for determination by the court were indicated. The first question they put across for determinations was as follows: "1. Whether the applicants, having been declared redundant, should have their separation packages calculated in accordance with the provisions of section 54(1)(d) of the Employment Code Act No 3 of 2019, or under section 55(3)(a) of the same Act." 9.2 It only stands to reason that you could only have been declared redundant if you were in an employer/ employee relationship. We are therefore perplexed by the argument advanced by the appellants that the finding by the court to this effect was perverse. Are we to understand them to mean J13 to deny their status? In fact the affidavits in support (pages 29 to 32 ROA) is evidence on the employment relationship. Specifically, paragraph 3 on page 30 ROA states: "3. On divers dates) I and other Applicants were employed by the Respondent and served under Unionized Conditions of Service.)) 9.3 There is also evidence from the letters of appointment of the respective employees which are from pages 34 to 163 volume 1. In addition, notice of termination of employment from pages 165 to page 333 volume 2 and they continue from page 334 to 523 volume 2. 9.4 Thus the assertion by the appellants that they were not in an employment relationship flies in the teeth of the evidence on record. 9.5 It is therefore our firm position that the finding was supported by the evidence on record. We accordingly find no merit in this ground and we dismiss it for lack of merit. 10.0 Jurisdiction of the High Court (General List) 10.1 As earlier stated, the 2nd, 3rd and 4th grounds are all attacking the decision of the lower court which was that it lacked jurisdiction and indicated that it was the Industrial and Labour Division which had exclusive jurisdiction to deal with the matter. J14 10.2 Our starting point is the provisions of the Constitution of Zambia in particular Article 134 which enact as follows: "134. The High Court has, subject to Article 128 - (a) unlimited and original jurisdiction in civil and criminal matters; 10.3 We have also scrutinized the provisions of the Industrial and Labour Relations Act particularly section 85 which enacts: (1 ) The Court shall have original and exclusive jurisdiction to hear and determine any industrial relation matters and any proceedings under this Act. 10.4 In addition section 85(9) provides as follows: ''85 (9) For the purpose of this section "industrial relations matters" shall include issues relating to- (a) inquiries, award and decisions in collective disputes; (b) interpretation of the terms of awards, collective agreements and recognition agreements; (c) general inquiries into, and adjudication on, any matter affecting the rights, obligations and privileges of employees, employers and their representative bodies." 10.5 The Supreme Court exhaustively dealt with the issue of jurisdiction over employment matters in the case of PC Chee lo and 9 Other vs Zambia Consolidated Copper J15 Mines4 where Muzyamba JS explained section 85(9) of the Industrial and Labour Relations Act in the following terms: "The key words in subsection (9) are collective disputes, collective agreements and recognition agreements, matters affecting the rights, obligations and privileges of employees, employers and their respective bodies. It is quite clear from this subsection that the terms "Industrial Relations matters" mean collective disputes, collective agreements or recognition agreements or matters affecting the rights, obligations and privileges of employees, employers and their respective bodies under the signed agreement. In the instant case the appellants are no longer employees of the respondent and their claim is for benefits due to them under the redundancy agreement. " 10.6 Further, the Supreme Court concluded that: "We find therefore and hold that, notwithstanding the removal of High Court from the Employment Act and on a proper interpretation of subsection (9) of Section 85 of Cap. 269, the High Court has jurisdiction to try cases arising out ofp ure master and servant relationships and the instant case is one such case. The appeal would succeed on this ground." 10.7 The learned authors of a Comprehensive Guide On Employment Law In Zambia Dr. Winnie Sithole Mwenda J16 and Chanda Chungu agreed with the reasoning of the Supreme Court in the cases of Cheelo (supra) and Cosmas Mukuka (Sued in his capacity as Secretary General of Zambia Congress of Trade Unions) vs Mwanza (Suing in his capacity as General Secretary of University of Zambia Lecturers and Researchers Unions)8 that although the Industrial Relations Court has exclusive jurisdiction to hear industrial relations disputes, the Subordinate Courts and the High Court (G eneral Division) could hear matters such as breach of contract or non-payment of redundancy benefits or wrongful dismissal. That the unlimited jurisdiction of the General Division of the High Court extends to matters of a purely master and servant relationship. They further stated at page 371 that: "Therefore, it is clear that both the Principal and Industrial Relations Division of the High Court can hear employment matters but the Industrial Relations Division is the only forum for industrial relations matters.'' 10.8 We have also perused the Bric Bank Limited T/A Gamwe Ranches vs Neil Kirkpatrick5 where the Constitutional Court had this to say on section 85 of the Industrial and Labour Relations Act: ''Our understanding of the provisions is that they define the jurisdiction of the Industrial Relations Division of the High Court by stating matters that the Division can hear J17 and the awards that can be awarded within its jurisdiction. To be specific, the reading oft hese provisions reveals that the Industrial Relations Division has exclusive jurisdiction to determine matters relating to industrial relations. Industrial relations under section 85(9) also means general inquiries into, and adjudication on, any matter affecting the rights, obligations and privileges of employees, employers and their respective representative bodies among other things." 10.9 We hold the considered view that the jurisdiction of the High Court has not been ousted when it comes to dealing with employment matters or matters arising out of pure master and servant relationship because of the unlimited jurisdiction of the General Division of the High Court. 10. 10 We also had occasion to pronounce ourselves in the cases of Mubita Mwananuka vs Armaguard Security Limited11 and Cavmont Bank Limited vs John Mwansa Kalinde & 40 Others9 where we endorsed the reasoning of the Supreme Court when they held that the General Division can hear disputes that do not fall within the ambit of industrial relations matters. We maintain the same position in this case. We wish to state that when it comes to matters dealing with the provisions of section 85(9)(b) of the Act, the Industrial and Labour Relations Division of the High Court has exclusive jurisdiction. J18 10.11 In light of the guidance given in the cases of PC Cheelo4 as well as Bric Back Limited5 we hold the view that the Industrial Relations Division does have exclusive jurisdiction to determine matters relating to industrial relations disputes, Whereas the High Court general list does have jurisdiction to hear matters out of a pure master and servant relationship. 10.12 Turning to this particular case, it is clear that, the appellants were seeking interpretation of sections 54(l)(d) and 55(3)(a) of the Employment Code Act in relation to their collective agreement. The cited sections provide as follows: "54. (1) An employer shall pay an employee a severance pay, where the employee's contract of employment is terminated or has expired, in the following manner: (d) where a contract of employment has been terminated by redundancy in accordance with section 55, the severance pay shall be a lump sum of two months' basic pay for each year served under the contract of employment. " 55 (3)(a) Subject to section 57, an employee whose contract of employment has been terminated by reason of redundancy shall:- (a) unless better terms are agreed between the employer and the employee concerned or the employee's representatives, be entitled to a minimum redundancy payment of not less than two months' pay for every year served and other benefits the employee is entitled to as compensation for loss of employment J19 10. 13 Having reflected on the above provisions and the question of jurisdiction of the General Division as well as the Industrial and Labour Division of the High Court, we take the view that the interpretation of sections 54 and 55 of the Employment Code Act are within the purview of matters that could be dealt with in the General Division of the High Court. Therefore, we hold that the General Division was in this case clothed with jurisdiction to hear and determine the matter at hand. 10.14 In light of the foregoing, we find merit in grounds 2, 3 and 4 which are on jurisdiction. 10.15 Ground 5 is in the alternative and in view of the position we have taken, it falls away. 11.0 Costs 11.1 In the 6th ground of appeal, the appellant has taken issue with the Order of the lower court which condemned the appellants in costs. The principle of law governing the award of costs was aptly summarized by Buckley LJ, in the case of Scherer vs Counting Instruments Limited12 where it was held: "The normal rule is that costs fallow the event. That party who turns out to have unjustifiably either brought another party before the court or given another party cause to have recourse to the court to obtain his rights is required to recompense that other party in costs. But, the judge has ... an unlimited discretion to make what order as to costs he considers that the justice of the case J20 requires. Consequently, a successful party has a reasonable expectation of obtaining an order for his costs to be paid by the opposing party but has no right to such an order, for it depends on the exercise of the court's discretion. " 11.2 The holding was adopted by the Supreme Court in the case of Matale James Kabwe vs Mulungushi Limited13 • 11.3 It is thus trite that in our jurisdiction the legal position is that a successful litigant is entitled to costs. In casu, the Order of the lower court stemmed from the success by the respondent on its preliminary objection. The lower court applied the principle of law that costs follow the event. 12.0 Conclusion 12.1 We have found merit in grounds 2, 3 and 4 and no merit in ground 1 and 5. In a nutshell, we find that: 1. The court below was on firm ground when it found as a fact that the relationship that existed between the respondent and the appellants was that of employer and employee. 2. The court below fell in error for dismissing the matter for want of jurisdiction and irregularity as it had the requisite jurisdiction. 3. Interpretation of sections 54 and 55 of the Employment Code Act are not within the exclusive , J21 ,, preserve of the Industrial Relations Division of the High Court. 4. The General Division of the High Court can hear employment disputes save for those exclusively reserved for the Industrial Relations Division such as collective disputes and the interpretation of collective and recognition agreements based on section 85(9) of the Industrial and Labour Relations Act. 5. It is settled law that costs follow the event and a successful litigant should not be deprived of his costs 13.0 Costs 13. 1 We Order that the matter goes back to the High Court for trial before a different Judge and that costs for this appeal shall abide the outcome of the matter in the lower Court. M.M. Kondolo, SC COURT OF APPEAL JUDGE ··········~ ················· B.M. Ma la A.M. Banda-Bobo COURT OF APPEAL JUDGE COURT OF APPEAL JUDGE