Kingdom Bank Workers Committee v Kingdom Bank Financial Holdings

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KINGDOM BANK WORKERS COMMITTEE
versus
KINGDOM BANK FINANCIAL HOLDINGS

HIGH COURT OF ZIMBABWE
PATEL J

Opposed Application

HARARE, 6 September 2011 and 10 January 2012

M. Nkomo, for the applicant
H. Zhou, for the respondent



      PATEL J:     The issues herein arise from the implementation of a

2010 collective bargaining agreement in the banking sector. The dispute

between the parties relates to the increments payable to the applicant’s

members. The dispute was referred to an arbitrator who made an award

on 25 June 2010 in favour of the applicant, holding the respondent guilty

of an unfair labour practice and ordering it to pay the sum of

US$491,645.

      The applicant now seeks the registration of the award. It also seeks

an order for the payment of the sum awarded, and an order for the

attachment and execution of the respondent’s property in the event of

non-payment.

      On 5 July 2010, the respondent filed an appeal-cum-review of the

award before the Labour Court, on the grounds of bias and gross

irrationality. The Labour Court dismissed both the appeal and review on

14 March 2011. Its decision was then appealed to the Supreme Court on

7 June 2011 in Case No. SC 118/2011.

      The respondent contends that the registration of the award is

premature, as it will render its appeal academic and cause irreparable
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prejudice to the respondent if the award were to be enforced. The

applicant counters that the noting of the appeal does not suspend the

award and that it is entitled to register and enforce the award, unless and

until the respondent takes appropriate steps to stay its execution.


The Submissions

      At the hearing of this matter, counsel were directed to address

three specific issues: the grounds upon which this Court may exercise its

discretion to decline registration of an award in terms of section 98 of the

Labour Act [Chapter 28:01]; whether the remedies sought by the applicant

beyond registration are competent under section 98; and whether the

noting of the appeal to the Supreme Court has the effect of suspending

the award.

      Adv. Zhou submits that any violation of acceptable notions of

elementary justice is contrary to public policy and an award that violates

such notions is unenforceable. See Zimbabwe Electricity Supply Authority v

Maposa 1999 (2) ZLR 452 (S); Pamire & Others v Dumbutshena N.O. &

Another 2001 (1) ZLR 123 (H). The award in casu was outrageous and

grossly irrational for several reasons. Firstly, the arbitrator made the

award before determining the legality of the collective bargaining

agreement of 17 February 2010 upon which it was premised. Secondly,

the increments claimed by the applicant had already been paid to its

members before that date, and the arbitrator arrived at the sum awarded

without any proper quantification having been done. Lastly, the effect of

the award is to irreparably stress the financial position of the respondent

without regard to its financial resources and ability to pay, thereby

defeating the mutually beneficial structure of the employer-employee

relationship. See Tel-One (Pvt) Ltd v Communication & Allied Services
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Workers Union of Zimbabwe 2007 (2) ZLR 262 at 266. Mr. Nkomo accepts

that registration of the award may be declined if it is found to be

untenable on the ground of public policy, viz. gross irrationality. However,

there is nothing irrational in the arbitrator’s decision. The sum awarded

represented the arithmetical computation of the amounts owed to the

applicant’s members. Moreover, the figures were drawn from the

applicant’s statement of claim and those figures were not challenged by

the respondent. The latter then accepted that an oral hearing was not

necessary and the arbitrator proceeded to determine the matter on the

papers.

      Both counsel accepted, quite correctly in my view, that any relief

beyond registration is not competent under subsections (14) and (15) of

section 98 of the Labour Act. Mr. Nkomo accordingly withdrew the relief

sought by the applicant in paragraphs 2 and 3 of the draft order.

      As regards the suspension of decisions appealed against, Mr.

Nkomo maintains that the effect of section 92E of the Labour Act is all-

inclusive. Any appeal in terms of the Act, including one to the Supreme

Court under section 92F, does not suspend the decision that is appealed

against. Adv. Zhou submits that the effect of an appeal to the Supreme

Court is to suspend not only the decision of the Labour Court but also the

arbitral award upheld by that court. He relies in this respect on the

decisions in Net One Cellular (Pvt) Ltd v Net One Employees & Another 2005

(1) ZLR 275 (S) at 282B, and in Dhlodhlo v Deputy Sheriff for Marondera &

Others HH 76-2011 at pp. 10-11.


Relevant Appeal Provisions

      The relevant provisions of the Labour Act governing appeals are

contained in sections 92E and 92F. They provide as follows:
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      “92E Appeals to the Labour Court generally
             (1) An appeal in terms of this Act may address the merits of
      the determination or decision appealed against.
             (2) An appeal in terms of subsection (1) shall not have the
      effect of suspending the determination or decision appealed
      against.
             (3) Pending the determination of an appeal the Labour Court
      may make such interim determination in the matter as the justice
      of the case requires.”

      “92F Appeals against decisions of Labour Court
            (1) An appeal on a question of law only shall lie to the
      Supreme Court from any decision of the Labour Court.
            (2) Any party wishing to appeal from any decision of the
      Labour Court on a question of law in terms of subsection (1) shall
      seek from the President who made the decision leave to appeal
      that decision.
            (3) If the President refuses leave to appeal in terms of
      subsection (2), the party may seek leave from the judge of the
      Supreme Court to appeal.”




Suspension of Arbitral Awards

      As regards the Net One Cellular case, supra, the most important

point to note is that the appeal provisions of the Labour Act at the time

that this case was determined were radically different from those

currently in force. At that time, appeals to the Labour Court were

governed by section 97 of the Labour Act. Section 97(1) listed the specific

determinations and conduct appealable to the Labour Court. Section

97(2) provided that any such appeal could address the merits of the

decision appealed against and/or seek a review of that decision. Section

97(3) then declared that an appeal would not have the effect of

suspending the decision in question. The salient distinctive feature of

section 97 is that it was confined to the appeals specifically enumerated

in subsection (1). Appeals against arbitral awards were not covered and
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were therefore subject to the general common law rule suspending any

decision appealed against.

      Section 97 was repealed in its entirety by Act No. 7 of 2005 and

replaced by the present section 92E which is significantly broader in its

scope of coverage. Having regard to these amendments, it is reasonably

clear that the decision of the Supreme Court in the Net One Cellular case,

supra, insofar as it pertains to the suspension of arbitral awards on

appeal, has been superseded by legislative intervention. In any event,

that decision is distinguishable on its facts which involved an award that

had already been registered by this Court.

      The decision of this Court in Dhlodhlo’s case, supra, is more recent

and impacts directly on the prevailing appeal provisions of the Labour

Act. Gowora J (as she was then) noted the existence of section 92E(3) but

held that there was no equivalent provision in relation to the decision of

an arbitrator. Consequently, she concluded that an arbitral award, being

in the domain of public law, continues to be regulated by the common

law principle that an appeal against a judgment operates to suspend it.

With great respect, I am constrained to disagree with that conclusion.

      Section 98 regulates references to compulsory arbitration under

Parts XI and XII of the Labour Act. Section 98(10) provides that:

            “An appeal on a question of law shall lie to the Labour Court
      from any decision of an arbitrator appointed in terms of this
      section.”

      Section 92E(1) is very broadly framed to encompass appeals in

terms of this Act. The ambit of appeals which do not suspend the

decisions appealed against is now considerably wider than the category

of appeals delineated under the repealed section 97. It is abundantly

clear that Parliament intended to modify the common law position
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generally. It is equally clear that an appeal against an arbitrator’s decision

under section 98(10) is an appeal in terms of the Act. I fully agree with Mr.

Nkomo that the provisions of section 92E are unambiguous and

unequivocal in their scope and effect. Subject to what follows later in this

judgment, they apply to every appeal in terms of the Act, including an

appeal under section 98(10), and they operate to pre-empt and preclude

the suspension of the decision appealed against. The common law

presumption against the operation and enforceability of judgments

appealed against has been explicitly ousted by section 92E in the case of

arbitral awards rendered under section 98.

      Contrary to Adv. Zhou’s contentions in this regard, I do not think

that the appeals envisaged in sections 92E(1) and 98(10) are materially

different. Section 92E(1) simply makes it clear that an appeal to the

Labour Court may address the merits of the decision appealed against, in

addition to any question of law, while an appeal under section 98(10) is

confined to questions of law. However, that does not render any such

appeal one that is not in terms of the Act. Moreover, although section 98

is a special provision dealing specifically with compulsory arbitration, that

does not necessarily suffice to invoke the maxim generalia specialibus non

derogant so as to exclude the operation of section 92E, particularly as the

latter is a later provision, endowed with the benefit of the maxim lex

posterior priori derogat.

      The golden rule of statutory interpretation dictates that the words

of a statute must be given their ordinary grammatical meaning unless to

do so would lead to an absurdity. I see no absurdity whatsoever in

construing section 92E to embrace appeals against arbitral awards under

section 98(10). Moreover, , to use the words of Lord Halsbury LC in Bank

of England v Vaghani [1891] AC 107 at 120, cited in PTC v Mahachi 1997 (2)
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ZLR 71 (H) at 75, it is very clear to me that the presumption against any

alteration of the common law has been excluded by the irresistible clarity

of the provisions under consideration. In the premises, I am amply

satisfied that an appeal against an award under section 98(10) is an

appeal in terms of the Act within the meaning of section 92E and, as such,

it does not have the effect of suspending the award in question.


Suspension of Labour Court Decisions

      Section 92F of the Labour Act provides for appeals to the Supreme

Court from decisions of the Labour Court, albeit only on questions of law.

Mr. Nkomo submits that section 92E is categorical in its application to any

and every appeal in terms of the Act, including one from the Labour

Court to the Supreme Court. Consequently, the appeal against the

Labour Court’s decision in casu does not suspend that decision or

preclude the registration of the arbitral award upheld by it. Adv. Zhou

persists with his reliance on the Net One Cellular case, supra, to challenge

the enforceability of the award. However, as I have already explained,

that decision is distinguishable on its facts and, in any event, it has been

superseded by the legislative amendments to the appeal provisions of

the Act. Moreover, I find it extremely difficult to grasp and digest Adv.

Zhou’s contention that an appeal to the Supreme Court is made in terms

of the Rules of that Court and not in terms of the Labour Act.

      The heading of section 92F reads “Appeals against decisions of

Labour Court” and differs from the heading of section 92E which reads

“Appeals to the Labour Court generally”. Does the wording of these

headings impinge on the ambit of section 92E in order to answer the

question whether an appeal under section 92F is an appeal in terms of

the Act within the contemplation of section 92E?
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      It is necessary in this context to have regard to the relevant

provisions of the Interpretation Act [Chapter 1:01]. Section 7 of the Act is

particularly germane to the question at hand. It states that:

      “In an enactment—
             (a) headings and marginal notes and other marginal
      references therein to other enactments; and
             (b) notes, tables, indexes and explanatory references
      inserted therein as part of any compilation or revision in terms of
      the Statute Law Compilation and Revision Act [Chapter 1:03];
             shall form no part of the enactment and shall be deemed to
      have been inserted for convenience of reference only.”

      Section 2(1) of the Interpretation Act spells out its general scope of

application, while section 2(2) provides as follows:

            “Nothing in this Act shall exclude the application to any
      enactment of any rule of construction applicable thereto and not
      inconsistent with this Act.”

      The traditional common law rule of statutory interpretation is that

a heading does not form part of the operative provision. See R v Hare

[1934] 1 KB 354, at 355. However, the context of the provision under

scrutiny may dictate otherwise. The modern tendency is to accept that,

while headings cannot control the plain words of a statute, they may be

regarded as preambles in order to explain ambiguous provisions or

words in the statute. See Maxwell on Interpretation of Statutes (11th ed.) at

pp. 48-49.

      The approach adopted by Bennion: Statutory Interpretation (1984)

at p. 590, goes significantly further. The learned author accepts that the

plain literal meaning of the words in a statute cannot be overridden

purely by reason of a heading. However, he takes the view that, in

accordance with the informed interpretation rule, modern judges
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consider it not only their right but their duty to take account of headings.

He accordingly opines that:

             “A heading within an Act, whether contained in the body of
       the Act or a Schedule, is part of the Act. It may be considered in
       construing any provision of the Act, provided due account is taken
       of the fact that its function is merely to serve as a brief, and
       therefore necessarily inaccurate, guide to the material to which it is
       attached.”

       I must confess that I find this robust approach very attractive,

particularly if one accepts that the entire statute is passed by Parliament,

including headings inserted for reference purposes. Be that as it may, it is

difficult to reconcile it fully with the provisions of section 7 of the

Interpretation Act. In contrast, the flexible approach as to the significance

of headings propounded in Maxwell, supra, is not in any way inconsistent

with that section. I therefore take the view that it may be legitimately

adopted and applied in conformity with section 2(2) of the Interpretation

Act.

       Turning to section 92E of the Labour Act, the language of

subsections (1) and (2) evidently encompasses every appeal made in

terms of the Act, including one from the Labour Court to the Supreme

Court. However, subsection (3) of section 92E appears to be limited to the

interlocutory powers of the Labour Court in relation to appeals pending

before it. This would indicate that the appeals referred to in subsections

(1) and (2) of that section are also appeals before the Labour Court, as

distinct from appeals before the Supreme Court. It seems to me that this

apparent ambiguity can only be resolved by having regard to the context

of sections 92E and 92F.

       In my view, there are two features that have a direct bearing on

the contextual setting of these two provisions. The first is that the latter
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immediately follows the former. The second is that they were both

introduced and inserted at the same time by section 32 of Act No. 7 of

2005. Given these factors of their juxtaposition and the contemporaneity

of their enactment, it seems virtually impossible to disregard their

headings. Taking those headings into account, it becomes clear that

section 92E is confined to appeals made to the Labour Court generally,

while section 92F deals specifically with appeals against decisions of the

Labour Court to the Supreme Court. It follows that the two provisions

must be interpreted and applied separately and independently from one

another. I am fortified in differentiating them in this manner by dint of

the fundamental hierarchical distinction between the two courts. The

Supreme Court is a constitutionally established court of general appellate

jurisdiction, while the Labour Court is creature of statute with limited

jurisdiction in the sphere of labour relations only. In the premises, I am

inclined to hold that an appeal under section 92F is not an appeal “in

terms of this Act” for the purposes of section 92E. Consequently, an

appeal from a decision of the Labour Court to the Supreme Court would,

in accordance with the general common law rule, operate to suspend

that decision, subject to the right of the successful party to apply for

execution pending appeal.


Disposition

      In light of the foregoing construction of the relationship between

sections 92E and 92F, the answer to the question posed at the outset

must be answered in the affirmative. Thus, the appeal to the Supreme

Court by the respondent against the decision of the Labour Court,

upholding the arbitrator’s award in casu, operates to suspend that

decision as well as the award. It follows that the present application for
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the registration of the award under section 98(14) and (15) of the Labour

Act is premature and cannot be granted at this stage. The applicant must

await the outcome of the respondent’s appeal to the Supreme Court.

      In the circumstances, I do not deem it necessary to consider the

remaining question as to whether or not the award is so grossly irrational

or so violative of elementary notions of justice as to be unenforceable on

the ground that it is contrary to public policy. This is an aspect that will

presumably be fully canvassed and determined in the pending appeal.

      As regards costs, it seems to me that this is a proper case for not

applying the general rule of costs following the cause. The principal issue

raised herein is one of appreciable public importance with respect to

which the law was not clearly settled. In the result, the application is

dismissed, with each party bearing its own costs.




Donsa-Nkomo & Mutangi Legal Practice, applicant’s legal practitioners
Kantor & Immerman, respondent’s legal practitioners