Clemio Machingaifa AND Chenjerai Mutambisi Versus Agricultural BANK OF Zimbabwe Limited

### Preamble
HH 61/05
HC 7527/04
CLEMIO MACHINGAIFA
and
CHENJERAI MUTAMBISI
---------


==============================

CLEMIO MACHINGAIFA
and
CHENJERAI MUTAMBISI
versus
AGRICULTURAL BANK OF ZIMBABWE LIMITED

HIGH COURT OF ZIMBABWE
KAMOCHA J
HARARE, 4 and 13 July 2005

Opposed Court Application

Ms Valla, for applicants
Mr Dondo, for respondent

KAMOCHA J: The applicants in this matter seek an order in the following terms -

"It is ordered that: -

(1) it is hereby declared that clause 3 of the employment contracts between respondent and applicants entitling applicants to payment of a mileage allowance based on mileage of 4 000 kilometre per month at applicable standards AAZ rates remains part of the contracts between the parties. Accordingly the applicants are entitled to payment of such allowance;

(2) respondent pay the outstanding allowance to the applicants inclusive of interest at the prescribed rate from the date the allowance became due to date of final payment within 14 days of service of this order; and

(3) respondent shall pay costs of this application."

The facts giving rise to these proceedings are briefly these. Both applicants were employed by the respondent as directors. The 1st applicant was assistant director in charge of Credit Risk while 2nd applicant was assistant director in charge of Debt Recovery. The applicants signed contracts of employment in the year 2000 whose clause 3 which related to the use of motor vehicles reads thus -

"3. Motor Vehicle Use
 You are entitled to the use of an Agribank Company Car under the prevailing terms and conditions. You are required to familiarise yourself with the existing rules and regulations for the use and disposal of the motor vehicle OR

You are entitled to purchase a motor vehicle under the prevailing motor vehicle purchase scheme. You will use the car for business and claim in accordance with the existing rules and as amended from time to time. You are also entitled to a mileage allowance based on a mileage of 4 000 kilometres per month at the applicable standard A.A.Z rates."

On 30 August 2001 the Human resources Manager of the respondent wrote to the applicants advising them that following the re-classification of management grades arising from what it termed a "Business Process Re-engineering" exercise, the Board had approved the conversion of the company car scheme to a personal car scheme under the managers and Field Staff Motor Vehicle Purchase Scheme.

What that meant was that the respondent was doing away with the first option whereby applicants were entitled to the use of an Agribank company car under the prevailing terms and conditions. That was going to take effect on 1 September 2001 from which date they would no longer access fuel and other facilities previously offered by the bank in that regard. They were offered to purchase their respective existing company vehicles.

The applicants were unhappy with the amendment to their contract conditions of service. They, together with two others, addressed a letter to management on 3 September 2001 expressing their disgruntlement. One of the issues they raised was possible legal action arising from their perceived contractual agreement violation. They raised in particular the non-payment of the mileage allowance based on a mileage of 4 000 kilometres per month at the application standard A.A.Z rates.

In response to their query on that subject, by letter dated 25 September 2001, the managing director contended that the respondent could not justify or sustain the cost as the allowance would be almost equivalent to the applicants' salaries.

Thereafter the parties exchanged considerable correspondence for a period of nearly three years. The applicants continued to make representations and demands to the respondent since the allowance was not being paid. Needless to say that the correspondence exchanged did not yield any result. The respondent maintained its stance that it could not justify or sustain the cost. At no stage during the period of two years eight months did the respondent state that clause 3 of the agreement was infact inserted into the agreement by mistake.

It was only on 14 April 2004 that the respondent decided to say so in the following terms -

"I refer to your memo dated the 22nd of March 2004 and apologize for the late response.

The allowances whose payment you seek were not intended and the bank does not regard them as part of your contract. A mistake was made which resulted in their inclusion in the letter of offer to yourselves.

The intention was for you to claim for the use of your personal vehicles under the bank's prevailing terms and conditions only. I am sure you are aware that the reason why the bank gave you this option was to cut on costs. This cannot be achieved if allowances almost equal to your salaries are paid to you.

The bank apologizes for the mistake and informs you that it cannot pay the allowances. The matter has also been brought up a couple of times since 2001 and should be put to rest. This is, therefore, the last time that the issue is addressed by the bank." My underlining.

As can be seen from the above memorandum the respondent was then being categoric that it had made a mistake a thing it failed to do during the couple of times the matter had been brought since 3 September 2001. The matter would not have dragged this far if the respondent had stated, the first time the matter was raised, that the inclusion of the allowances was a mistake. The suggestion, in the memorandum, that the allowances whose payment the applicants sought were not intended and the bank did not regard them as part of the applicants' contract is simply untenable. If the respondent did not intend the allowances to be part of the contract, it would have removed them from the contract document at the time it amended the contract by removing the first option which related to the use of company vehicles.


Further, when one examines the contract document filed of record it reveals that the 4,000 kilometres was hand written while about 99% of the document was type written. There are also some figures that were hand written such as the salary, annual bonus, clothing allowance, the vacation and occasional leave etc. There can be no doubt that these were inserted into the blank spaces after careful thought. It seems to me that the same applies to the 4,000 kilometres. The suggestion, therefore that the inclusion of the entitlement of a mileage allowance based on mileage of 4,000 kilometres per month at the applicable standard AAZ rates, was inserted by mistake is equally untenable.

If at all it had been a mistake the respondent would have immediately realised it and would have said so when the applicants first raised the issue on 3 September 2001 failing which respondent would have realised and said so at any other subsequent occasion the applicant raised it in 2001 or early 2002 or even 2003. It therefore seems to me that if at all respondent had made a mistake then such mistake was grossly unreasonable.

The respondent further submitted that the applicants must be held to have waived their rights by not bringing up the matter to court timeously. The submission is clearly devoid of any merit when regard is had to correspondence filed of record in which respondent admits that applicant never manifested any signs of abandoning their rights. On 25 September 2001 the managing director acknowledged that the applicants' memorandum raised the issue of "Legal action insinuated because of perceived contractual agreement violation." On 5 June 2003 the Human Resources Manager, in response to another communication from the 2nd applicant, also acknowledged that the matter was first raised in 2001 and as far as the bank was concerned it had been deliberated upon to its finality then. The above statement was clearly misleading. The bank never said it had made a mistake at that stage. The issue was therefore very much alive.

Finally the bank, in the final Memorandum of 14 April, acknowledged that the matter had been brought up on a couple of times since 2001. In such circumstances it cannot be said that the applicants abandoned their rights when the requirements for a waiver were not met at all.
 Respondent finally submitted that this smatter was essentially a labour dispute and the appropriate court to deal with this matter was the labour court in the light of the provisions of the Labour Relations Amendment Act. The submission is equally devoid of any merit. The provisions of section 89(1) do not empower the Labour Court to grant declaratory orders. The Labour Court is a creature of statute and it only operates within the confines of such statute. Section 89(6) does not take away the powers of this court to issue declaratory orders.

In the light of the foregoing I would grant the application in terms of the draft order on page 1 of this judgment.

Messrs Kantor & Immerman, applicants' legal practitioners.
Chinamasa, Mudimu & Chinogwenya, respondent's legal practitioners.
--- END OCR FALLBACK ---