Beach Consultancy (Pvt) Ltd t/a Aviation Ground Service v Obert Makonya

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGMENT NO. LC/H/176/2020
HARARE, 13 JULY 2020
CASE NO.
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IN THE LABOUR COURT OF ZIMBABWE      JUDGMENT NO. LC/H/176/2020

HARARE, 13 JULY 2020				      CASE NO. LC/H/APP/480/19

AND 31 JULY 2020

In the matter between:-

BEACH CONSULTANCY (PVT) LTD			Applicant

T/A AVIATION GROUND SERVICE

And

OBERT MAKONYA						Respondent

Before Honourable B.T. Chivizhe, Judge

For Applicant:		Ms S. Mapange (Legal Practitioner)

For Respondent		Mr C. Chisasa (Representative)

CHIVIZHE, J:

The application placed before me is for rescission of a consent order granted by this court under reference LC/H/ORD/574/2019 on the 17th of July 2019. The application is opposed.

On the date of hearing the Respondent having taken several points in limine the following constitutes the court ruling on the four points in limine. The points in limine were as follows;

The application mounted by Lunga Attorneys is a legal nullity for want of procedure as Lunga Attorneys have not assumed agency as required by the rules of the court.

The Applicant’s Founding Affidavit does not specify proper grounds on which rescission is sought.

The application is improperly placed before the court as the Labour Court  has no jurisdiction to rescind an order granted by consent of the parties which order emanated from an out of court settlement.

The deponent to the Founding Affidavit, Mr Caleb Mudyawabika in the absence of authorisation is not authorised to represent the Applicant, his Founding Affidavit is invalid and the application before this court is consequently invalid. The Respondent position is the application ought to be dismissed by this court for this reason.

I turn to address the points in limine as taken. The court shall initially address the third point as it has the potential to be dispositive of the matter should the court find that it has no jurisdiction in the matter.

Whether this court has jurisdiction to rescind a consent order

The Respondent position is that the Labour Court has no jurisdiction to rescind the consent order granted by the court which order emanated from a Deed of Settlement entered  into by the parties in their free will.

Mr Chisasa, in the hearing, emphasized that this court has no jurisdiction to rescind a consent order arising out of an out of court settlement agreement that had been referred to the Registrar on the basis of the Labour Court Rules, 2017. It was Mr Chisasa’s further submission that the matter having been settled under Rule 27 the court has no power to rescind the order so granted. The Applicant by filing the application for rescission under section 92C  of the Labour Act [Cap 28:01] clearly misapprehended the provisions of the Labour Court Rules more particularly Rules 27, 37 and 38. Further it was also very clear under the heading of section 92C of the Labour Act [Cap 28:01] that the application made under that provision relates only to judgements/orders handed down by the Labour Court after it has heard arguments. This was said to be apparent from the usage of phrase “its own decision.” This position however does not apply to orders that are handed down by consent of the parties which orders are arising out of an out of court settlement as was the case in casu. On this basis it was Respondent’s contention that the application not being properly before the court it therefore stood to be dismissed.

The Applicant’s position is that the application is properly before the court. The Labour Court  is empowered under section 92(c)(b) of the Labour Act [Cap 28:01] to rescind any judgement/ order made by the court where the court is satisfied that the judgement or order is void or was obtained by fraud or a mistake common to the parties. The Applicant’s further position is that an Applicant against whom a consent order has been entered can apply under the rules of court or under common law or both for the consent order to be rescinded. The Applicant relied on Mukundadzviti vs Mutasa 1990(1) ZLR 342.

Ms Mapange, in oral submissions, emphasized that this court has the power to rescind the particular court order granted which purportedly arose out of an out of court settlement. It was common cause that the court had delivered a judgment/order that has a reference number. It was that judgement/order issued by the court that Applicant was seeking to have rescinded as the judgement/order was obtained by fraudulent means. It was Ms Mapange’s further contention that the Respondent’s submissions to the extent that they were hinged only on the out of court settlement agreement were clearly amiss. Section 92(c)(1)(b) of the Labour Act [Cap 28:01] gives the Labour Court general power to rescind its own judgements. The fact that the judgement was obtained through consent would not stop the process of setting aside of the judgement on the basis of fraud. The Applicant was relying on a South African authority in the case of Childrae Estate Stores vs Standard Bank for South African Limited 1924 OPD at p.163.

The premise that the court ought to start from is that the Labour Court is a creature of statute and can only do that which it is empowered by the Labour Act [Cap 28:01] and its rules. It is indeed correct as submitted by the Applicant that under section 92 C(1)(b) as read with Rule 40 of the Labour Court  rules, 2017 the Labour Court is granted powers to set aside a judgment or order granted due to fraud or a mistake common to the parties.

Section 92 C reads as follows;

Rescission or alteration by Labour Court of its own decisions

Subject to this section, the Labour Court  may, on application, rescind or vary any determination or order

Which it made in the absence of the party against whom it was made; or

Which the Labour Court  is satisfied is void or was obtained by fraud or a mistake common to the parties; or

In order to correct any patent error.

On the basis of section 92C (1) it is clear that the Labour Court indeed has jurisdiction to rescind or alter its own judgement or order granted by the court. The judgement entered by the court may arise through a hearing where parties have presented arguments and the court then hands down its determination on the issues argued before it. The rules also make provision for the judgement or order that arise through an out of court settlement by the parties (Rule 27) or through the default of a party or witness (rule 37) or through a consent to judgement by the Respondent in the matter (Rule 38). Which ever way the court arrives at the judgement or order they are all determinations emanating from the court. The fact that an order may have been arrived at through an out of court settlement as in this case would not make the judgement any different from the others. The judgement or order handed down by the court is its own determination and as long as it is a determination handed down by the court then it is susceptible to rescission or alteration by court upon an appropriate application by the party which is disgruntled. It is thereafter up to the court seized with such an application to determine the veracity of the claims made by the party seeking rescission taking into account that the provisions in section 92C only outline three instances where the court may rescind or vary its orders or judgments i.e. in the event of a default judgment or where the order is void/obtained by fraud/mistake or the order carries a patent error. It is also important to underline that Section 92C is not provided to enable a party to obtain the alteration of the substantive findings made by the court. The provisions are meant to correct procedural issues. On this basis therefore the jurisdictional point taken by the Respondent clearly stands to be dismissed.

Whether there is need for a company resolution

The next point taken by the Respondent is that Mr Caleb Mudyawabika, the deponent to the Appellant’s Founding Affidavit omitted to indicate whether he had been authorised through a Company Resolution to represent Applicant. It was Mr Chisasa’s submission that in the absence of such authorisation then the Founding Affidavit is invalid and consequently the application is an invalid application. Ms Mapange’s response was that the point had been sprung on her as a surprise by the Respondent’s representative. She therefore was not able to respond meaningfully to the submission. Her view however was that the matter before the court had a long history. It was not being heard for the first time before the court as a result there ought to be in the record somewhere the company resolution authorising Mr Mudyawabikwa to represent Applicant. She indicated there were authorities in support of this position and she would file the authorities. Both parties after the hearing did file authorities in support of their positions.

The issue that arises is whether there is a need for Company Resolution to be attached to an application in order to show that it is indeed the Applicant which is litigating and not an unauthorised person. The Applicant position is that it is not necessary that the Resolution of the Board of Directors be produced in all cases especially were as in the present case the deponent to the Founding Affidavit has previously represented the company.

It would appear that the issue has presented conflicting decisions in the High Court. The issue appears to have been settled however recently in the matter of Cuthbert Elkana Dube vs Premier Service Medical Aid Society SC73|19 which was a Labour Court matter. Garwe JA writing on behalf of the Supreme Court and in placing reliance on Madzivire & Ors vs Zvarivadza & Ors stated as follows;

“The High Court decision was appealed to this Court.  In a decision reported as Madzivire & Ors v Zvarivadza & Ors (supra), at 515, this Court (per Cheda JA) remarked as follows:-

“A company, being a separate legal person from its directors, cannot be represented in a legal suit by a person who has not been authorised to do so. This is a well established legal principle, which the courts cannot be ignored.  It does not depend on the pleadings by either party.  The fact that the person is the managing director of the company does not clothe him with the authority to sue on behalf of the company in the absence of any resolution authorising him to do so.  The general rule is that directors of a company can only act validly when assembled at a board meeting.  As exception to this rule is where a company has only one director who can perform all judicial acts without holding a full meeting.”

[38]	The above remarks are clear and unequivocal. A person who represents a legal entity, when challenged, must show that he is duly authorised to represent the entity.  His mere claim that by virtue of the position he holds in such an entity he is duly authorised to represent the entity is not sufficient.  He must produce a resolution of the board of that entity which confirms that the board is indeed aware of the proceedings and that it has given such a person the authority to act in the stead of the entity.  I stress that the need to produce such proof is necessary only in those cases where the authority of the deponent is put in issue.  This represents the current state of the law in this country.”

It seems that the finding above resolves the point. In this case the deponent who is the Managing Director of the Applicant has not been able to produce the Board resolution. He however believes that in view of his position as the Managing Director it is unnecessary for him to produce the resolution. This is apparent from the averments made in the Founding Affidavit. In paragraph 1 he states:

“1.	I am the Applicant’s Managing Director. I am duly authorized to depose to this affidavit on behalf of Applicant by virtue of my position”

Whilst he may be the Managing Director on the basis of the Cuthbert Dube decision this is not sufficient to clothe him with authority. He is still required to produce a resolution of the Board which confirms that he is authorised to act in the place of the company. This is more especially as the issue of his authority has been challenged by the Respondent. It must follow therefore that the point in limine succeeds. It shall not be necessary for the court to proceed to determine the rest of the points in limine.

In the result the following order is made;

The third point in limine is dismissed.

The fourth point in limine is upheld with costs.

The deponent to the Founding Affidavit, not being authorised to represent the Applicant, the application is consequently invalid.

The application is hereby struck off the roll.

Lunga Attorneys, applicant’s legal practitioners