Wellington Muneka v Olivine Industries (Private) Limited

### Preamble
IN THE LABOUR COURT OF ZIMBABWE HELD AT HARARE
5 FEBRUARY 2024
JUDGMENT NO. LC/H/45/24
CASE NO. LC/H/920/22-1
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IN THE LABOUR COURT OF ZIMBABWE HELD AT HARARE 5 FEBRUARY 2024

AND 9 FEBRUARY 2024

IN THE MATTER BETWEEN:-

JUDGMENT NO. LC/H/45/24 CASE NO. LC/H/920/22-1

WELLINGTON MUNEKA	APPLICANT

AND

OLIVINE INDUSTRIES (PRIVATE) LIMITED	RESPONDENT

Before Honourable Mr. Justice L.M. Murasi

For Applicant	Mr. E.E. Matika

For Respondent	Advocate F. Mahere

MURASI J.,

On 9th October 2023, the Supreme Court made the following Order by Consent:

The appeal be and is hereby allowed.

Paragraph 2a of the judgment of the court a quo be and is hereby set aside.

The matter be and is hereby remitted for the court a quo to determine the following issues:

Whether damages should be awarded to the respondent for the period March 2009 to March 2019 payable at the rate of 1:1 between the US Dollar and the Zimbabwean dollar or at the prevailing inter-bank rate.

The damages and back-pay in lieu of reinstatement taking into account mitigatory factors, if any.

Whether the respondent should be paid back-pay for the period 11 October 2012 to 12 March 2018 during which he did not prosecute his appeal.

At the commencement of the oral submissions Advocate Mahere made the request that Respondent wanted the Applicant to give evidence as regards the issue of mitigation of damages. Though Mr. Matika was at first reluctant to take that route, it was impressed upon him that the

Order issued by the Supreme Court was by consent and the only way paragraph 3 (b) would be addressed would be by way of viva voce evidence from the Applicant.

Applicant’s Evidence

Applicant stated that after he was dismissed from employment in March 2009, he stayed with friends for sometime before relocating to his communal home in Chiweshe. He further stated that he began the business of selling vegetables and earned amounts varying between USD 45-00 and USD 50-00 per month. He also stated that he assisted a friend a friend in advertising furniture on his behalf and to this end, he was provided with a cellphone. The advert for the furniture bore his features. He denied that he was paid for this contribution save for a few dollars to assist him with transport. He explained that he was unable to file his appeal timeously because of persistent mistakes which he was told to correct and this was coupled with the fact that he now lived in the communal land and he was not always in town. Applicant revealed that he holds a Diploma in Marketing. He was however unable to produce proof that he had sought any form of employment after his dismissal. He also revealed that he was paid money denominated in Zimbabwe Dollars and the grocery items but had not been paid the United States Dollar component. He was however unable to give the exact figure of the claim but said it was in the region of USD 40 000- 00.

Applicant was cross-examined to some length by Respondent’s Counsel. He did not impress as a truthful witness. He was unable to explain certain issues away. He could not explain why his friend would use him to advertise the furniture for such a long period without him benefitting from the enterprise. He was unable to explain why he had not given the information pertaining his applications for employment to his legal practitioners. He did not know how much he was claiming in United States Dollars. The only tangible evidence was the earnings he said received from selling vegetables.

Parties’ Submissions

Mr. Matika submitted that the obligation to pay arose after the effective date, which was February 2019 and therefore it would not be correct to suggest that the payment due to Applicant was subject to the 1:1 regime. He further submitted that the matter was still to be resolved as at the effective date as the judgments only made in November 2021. He argued that the payment in United States Dollars was therefore supposed be at the prevailing interbank rate on the date of payment. Mr. Matika also submitted that Applicant had given his evidence as regards the mitigation he undertook after his dismissal from employment and that he was entitled to the figure of USD40 380-00 as claimed.

As far as period between October 2012 and March 2018, Mr. Matika submitted that Applicant had applied for condonation of the late filing of the appeal and the fact that the Court had condoned his non-compliance was evidence that his explanations had been accepted as correct.

In response, Advocate Mahere stated that even though the Applicant attempted to show during his testimony that he had tried to mitigate his loss, there was no mention of this in the Founding Affidavit. She further submitted that no letters were filed by the Applicant showing that he had attempted to find alternative employment. She submitted that the evidence given by the Applicant as far as the furniture business was concerned could not be taken as the truth. She argued that Applicant must have been part of the business but did not want to disclose this. Advocate Mahere further submitted that a reasonable period to find alternative employment would have been 24 months.

As far as the actual damages were concerned, Advocate Mahere submitted that no actual figures were relied upon in the application and the figures submitted by the Respondent had not been disputed by the Applicant. In light of this, she submitted that Applicant was entitled to the sum of USD 5325-21 for the period of 24 months. Advocate Mahere argued that Applicant was not entitled to be paid for the period from 2012 to 2018 as the 24 months would have ended in 2011 and such payment would fall outside the period of 24 months. It was further argued that Respondent could not be expected to pay for Applicant’s lack of diligence in prosecuting his matter.

As to whether Applicant was entitled to damages based on the 1:1 calculation, Advocate Mahere stated that the formula given Statutory Instrument 33 of 2019 was applicable. Her reasoning was based on the fact that Applicant’s salaries were known prior to February 2019 and could be calculate with certainty. They were therefore figures due to the Applicant in terms of the contract existing between the parties. She argued that this was different from delictual damages.

ANALYSIS

I will begin in making an observation regarding the need to lead evidence in mitigation of damages. This Court referred to this issue on page 4 of the judgment. This is what the Court stated:

“I wish to deal with the issue of evidence raised in the above precedents. Ms Zvinavashe expressed in clear terms that Applicant was supposed to give evidence on the issue of mitigation. She also stated that she would indeed have been able to cross-examine the Applicant on the issue of mitigation. Mr. Gwisai was certainly of a different view. He stated in response that he did not see the need for Applicant to give evidence on oath having regard to the concessions made by the Respondent about the economic situation bedeviling the country. In a nutshell, no evidence was given by the Applicant in this respect. The Court is the non-wiser as to what steps he took to mitigate his losses. The Court was not informed by way of viva voce evidence what earnings Applicant made during the period in question. The Court will return to the issue later in the judgment.”

With the benefit of hindsight, it is probable that it was realized at that hearing that Applicant was not in a position to assist the Court with the required evidence. This is borne out by the evidence that was placed before the Court in these proceedings. I have already commented on the quality

of the evidence given by the Applicant elsewhere in this judgment. Applicant has not provided any evidence as regards his attempts to find alternative employment. The mitigation is limited to the selling of vegetables. The Court’s previous judgment gave the period as 24 months. This therefore deals with paragraph 3 (c) in the remittal from the Supreme Court as that period falls outside the 24 months.

I have already referred to the evidence of the Applicant in respect of mitigation. He was able to raise varying figures per month. Further, a reading of the record and from Applicant’s viva voce evidence, Applicant has not provided evidence of the actual monthly figures he was entitled leading to the figure of USD 40 380-00. In my previous judgment, I alluded to the same issue and awarded Applicant the amount that was tendered by the Respondent. This is the same case in these proceedings.

I now turn to the submissions by Advocate Mahere as regards the application of 1:1 formula. It is my view that her submissions show that there is a clear misinterpretation of the law as regards the provisions of Statutory Instrument 33 of 2019. In Zambezi Gas (Pvt) Ltd vs N.R. Barber (Pvt) Ltd SC 3/20 in which MALABA CJ had this to say at page 9 of the cyclostyled judgment:

“The liabilities referred to in s 4(1)(d) of S.I 33/19 can be in the form of judgment debts and such liabilities amount to obligations which should be settled by the judgment debtor. In interpreting s 4 (1)(d), regard should be had to assets and liabilities which existed immediately before the effective date of the promulgation of S.I. 33/19. The value of the assets and liabilities should have been expressed in United States dollars immediately before 22 February 2019 for the provision of s 4 (1)(d) of S.I 33/19 to apply to them.

Section 4 (1)(d) of S.I. 33/19 would not apply to assets and liabilities, the values of which were expressed in any foreign currency other than the United States dollar immediately before the effective date. If, for example, the value of the assets and liabilities was, immediately before the effective date, still to be assessed by application of an agreed formula, s 4 (1)(d) of S.I. 33/19 would not apply to such a transaction even if the payment would thereafter be in United States dollars. It is the assessment and expression of the value of assets and liabilities in United States dollars that matters.”

A reading of the above makes it clear that for a liability to be covered by the 1:1 rule, the liability should be have arisen before the effective date. In casu, the liability to pay, that is the judgment, must have been so determined before February 2019. Such a position was supported by UCHENA JA in Regis Maganzi vs Francis Jekera & Another SC 52/22 where he had this to say:

“The order granted in Case No. HC 11449/18 was granted on 22/2/2019 and as such was not granted immediately before the effective date of the promulgation of S.I. 33 of 2019. The order was granted on the effective date but after it had come into effect, it can therefore not be valued in RTGS dollars at the rate of 1 to 1 as it falls under the provisions of section 4 (1) (e) of S.I. 33 of 2019.”

I have to put the matter into proper perspective. The judgment of the Court giving rise to the liability was in November 2021. This is when the ‘liability’ is deemed to have commenced. The determination of the debt or liability due by the Respondent was therefore made in November 2021. This therefore means the debt is susceptible to the provisions of section 4 (1) (e) as pronounced by UCHENA JA in the Regis Maganzi case supra. As stated earlier, the interpretation sought to be relied upon by Advocate Mahere, is thus incorrect. The correct interpretation should that the payment should be at the interbank rate on the date of payment.

I will now turn to the actual amount due to the Applicant. It must be remembered that

Applicant acknowledged receipt of the grocery component the Zimbabwe dollar component of the damages. Advocate Mahere submitted that Applicant was entitled to receive a total sum of USD 5325-21 for the 24 months. No counter figures were given by the Applicant’s legal practitioner. If the principle in calculating damages is implemented, the amounts earned by the Applicant during that period should be deducted from the total figure. Taking the lower figure of USD 45-00 per month, this comes to a total of USD 1080-00. The last figure should therefore be subtracted from the total figure of USD 5325-21. This gives the final figure of USD 4245-21.

In the result, the Court determines as follows:

Damages shall be awarded at the prevailing inter-bank rate.

Applicant shall NOT be entitled to payment of damages in lieu of reinstatement for the period 11 October 2012 to 12 March 2018.

Applicant shall be entitled to payment of damages in lieu of reinstatement for the United States Dollar component in the sum of USD 4245-21 to be paid at the prevailing inter- bank rate on the date of payment.

The above amount money shall be paid within 30 days from the date of this Order.