Musa Manyika v Leabridge Investments (Pvt) Ltd

### Preamble
Judgment No. SC 97/22
1
Civil Appeal No. SC 384/17
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DISTRIBUTABLE:     (84)

MUSA MANYIKA

v

LEABRIDGE INVESTMENTS (PVT) LTD

SUPREME COURT OF ZIMBABWE

GWAUNZA DCJ, HLATSHWAYO JA & MAKONI JA

HARARE: 31 MAY 2020 & 11 AUGUST 2022

Ms O Mashumba, for the appellant

Ms P.R Samuriwo, for the respondent

HLATSHWAYO JA:

[1]	This is an appeal against the decision of the Labour Court of Zimbabwe sitting at Harare wherein it partially allowed an application by the respondent for rescission of a default judgment which had been granted in favour of the Appellant.

BACKGROUND FACTS

[2] 	The appellant was employed by the respondent as a sales representative.  On 7 July 2014, the appellant was suspended from employment and charged with misconduct for breaching s 4(f) and 4 (g) of the Labour (National Employment Code of Conduct) Regulations SI 15 of 2006(hereinafter referred to as “SI 15 of 2006”). The charges comprised of incompetence and inefficiency in performance of duties, failure to meet monthly targets and failure to carry out duties as per the job description.

[3] 	On 24 July 2014, the disciplinary proceedings commenced before the Disciplinary Authority chaired by one Pardon Chakanyuka. However, the proceedings were not finalised within the mandatory 14 day period prescribed in s 6(2) of SI 15/2006. The appellant challenged the propriety of continuation of the proceedings on 22 September 2014. Acting in terms of s 101(6) of the Labour Act [Chapter 28:01], the appellant referred the dispute to a labour officer for its disposal in terms of the law.

[4] 	On 27 November 2014, the dispute was settled by the labour officer and a certificate of settlement was duly issued and signed by both parties. The essential part of the certificate was that the complainant was to be reinstated without loss of salary and benefits and was to report for duty on 1 December 2014.  However, when the appellant went back to work, he was denied access to his office and some of his arrear salary and benefits were not paid in breach of the certificate of settlement.

[5] 	 On 5 December 2014, the appellant was served with another suspension letter and was invited to attend a disciplinary hearing. The charge sheet showed that he had been suspended based on the same old charges which had been settled on 27 November 2014, the only difference being that a third charge of “unauthorised use of a company vehicle for personal use” had been added.

[6] 	On 11 December 2014, the second disciplinary hearing commenced and on 16 December 2014, the appellant applied for review in the court a quo. He alleged that he was deprived of legal representation as the respondent had not paid his arrear salaries which he intended to use to seek legal representation. On 20 May 2015, the court a quo handed down an order in default in favour of the appellant. The respondent, whose legal practitioners did not file any heads of argument was in default.  The terms of the order granted in default were as follows:

“1. The disciplinary proceedings by the respondent’s disciplinary authority in respect of charges 1 and 2 be and are hereby quashed.

2. 	The disciplinary proceedings in respect to charge 3 are hereby remitted back for a hearing de novo.

3. 	The applicant be and is hereby reinstated to his original position without loss of salary and benefits with effect from 7 July 2014 to date of reinstatement.

4. 	In the event that reinstatement is no longer tenable, the applicant is to be paid damages in lieu of reinstatement, the quantum of which is to be agreed by the parties, failing which either party can approach this court for assessment.

5. 	The respondent is to pay costs.”

[7] 	Pursuant to the above order, the respondent filed an application for its partial rescission on the grounds that the appellant served its heads of argument in the application for review at the wrong address and the respondent’s legal practitioners were not aware of them and hence did not file its own heads of argument. It averred that there was, therefore, no wilful default. The other ground was that the order was issued in error or as a result of fraud in respect of the third charge.

[8] 	The court a quo held that the record showed that on 15 January 2015, in the notice of response filed by the respondent in the application for review, the respondent’s address for service was Hogwe, Dzimirai & Partners Legal Practitioners, suite 607-6th Floor, Hungwe House, 69 Jason Moyo Avenue, Harare.  The court opined that it was, therefore, erroneous for both the appellant and the Registrar to continue to serve pleadings at its place of business when the respondent was legally represented.   The court a quo concluding that the explanation for the default was reasonable in the circumstances held that there was no wilful default.

[9] 	Concerning the inclusion of paragraph 2 in the order in relation to the third charge, the court a quo acknowledged that there was a patent error. The court a quo indicated that it was the respondent’s case that the issue of the third charge was not pleaded in the review application as that hearing had not yet commenced on 16 December 2014 when the review application was filed. The court made a finding that it erroneously included para 2 dealing with the third charge in its order.  This is because the proceedings in respect of charge 3 were subsequently duly conducted in the presence of the appellant’s lawyer and there was no basis for ordering a remittal and a hearing de novo.  Consequently, it held that the outcome in relation to the disciplinary proceedings regarding the third charge still stood, and that it was a patent error to order reinstatement when the appellant had been properly charged and dismissed. As a result, the court a quo partly rescinded its judgment by striking out paras 2, 3 and 4 of the review order, while upholding para 1 pertaining to the 1st and 2nd charges and the costs order.

[10] 	Aggrieved by that outcome, the appellant filed the present appeal on the following grounds.

The court a quo misdirected itself and therefore erred in law in holding that the respondent was not in wilful default.

The court a quo misdirected itself and, therefore, erred in law in holding that the respondent had a bona fide defence on the merits.

APPELLANTS ARGUMENTS BEFORE THIS COURT

[11] 	The appellant argued that the application for review indicated that the address for service for the respondent was No. 26 Harvey Brown, Milton Park Harare. It was further submitted that the respondent duly filed its notice of response through its legal practitioners but they did so in error as they did not file a written notice of assumption of agency in form LC 5 as required by the then r 18 (1) of the Labour Court Rules, 2006. On that account, the appellant argued there was no assumption of agency and that service of his heads of argument was not irregular in the circumstances.

[12] 	The appellant further argued that the review application was not only in relation to the first and second charge but also in relation to the third charge as evidenced by the record. He further argued that the disciplinary hearing commenced on 11 December 2014 whereat he contested the propriety of the proceedings in relation to all the charges. The appellant argued that considering that he had raised the issue pertaining to the third charge, the respondent still contended that the application for review was for the first and second charge only.

RESPONDENT’S SUBMISSIONS BEFORE THIS COURT

[13] 	Contrary to the arguments advanced by the appellant, the respondent submitted that the decision by the appellant to serve heads of argument at 26 Harvey Brown Milton Park, Harare was not only mischievous and fraudulent, but it was also a deliberate act to snatch at a default judgment.  It was further submitted that the action by the appellant was purely out of malice despite him knowing that the respondent was legally represented. Its argument therefore was that the failure to file its heads of argument was not wilful.

[14] 	Finally, it was submitted that the respondent had prospects of success in the application for review for the reason that the appellant had misused the company vehicle which was in violation of the code of conduct. The respondent argued that the appellant should not be allowed to continue with an illegality by seeking to bring in the third charge during the review application when such could not possibly have been included in the application for review. The respondent therefore prayed for the dismissal of the appeal.

ISSUE FOR DETERMINATION

[15] 	In my view, the present appeal may be disposed of by determining whether the court a quo erred in granting the application for partial rescission of judgment.

I now turn to deal with the issue.

[16] 	An application for rescission is made in terms of s 92C (1) of the Labour Act [Chapter 28:01] (“the Act”).   Section 92 C(1) of the Act specifically provides  as follows:

“92C Rescission or alteration by Labour Court of its own decisions

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

(a) which it made in the absence of the party against whom it was made; or

(b) which the Labour Court is satisfied is void or was obtained by fraud or a mistake common to the parties; or

(c) in order to correct any patent error.”

In terms of the above provision, the Labour Court uses its own discretion in considering the merits of an application for rescission whenever such an application is made by the party that was in default. Redstar Wholesalers v Mutomba SC 142/04.

[17] 	 Good cause must be established by an applicant in order to get a default judgment rescinded. It was held by this Court in Redstar Wholesalers v Mutomba (supra) thus:

“In determining whether or not the default judgment should be rescinded, the Labour Court should have considered whether good cause had been shown.   This is the test generally applied in applications for rescissions of judgment.”

See also Du Preez v Hughes NO 1957 R & N 706 (SR); Songore v Olivine Industries (Pvt) Ltd 1988 (2) ZLR 210 (S); Simbi v Simbi SC164-90.

In determining whether good and sufficient cause has been shown, a court ought to consider “(a) the defendant’s explanation of his default, (b) the bona fides of the application to rescind the judgment, and (c) the bona fides of the applicant’s defence on the merits of the case. The court should normally consider these matters in conjunction with each other and cumulatively.” See Roland & Anor v McDonnell 1986 (2) ZLR 216 (S).

[18] 	In casu, the respondent in the court a quo failed to file heads of argument. Its argument was that the appellant served his heads of argument at its premises yet it was legally represented by a legal firm at a given different address. The respondent argued that in the circumstances those heads of argument were improperly served on it instead of its legal practitioners. As such, its legal practitioners, never having had sight of appellant’s heads of argument, could not file heads of argument on its behalf.

[19] 	 The notice of response in relation to the application for review by the appellant shows that the legal practitioner handling the matter was one Mr Hogwe of Hogwe, Dzimirai & Partners. That same notice also indicated the address of service for which processes should be served.

It is true that there was no proper assumption of agency in this matter.  However, the issue here is not whether the appellant acted legally correctly, but whether the explanation given for the default was reasonable.  The court a quo was fully aware of the provisions of section 25 of the Labour Court Rules, 2017 which deals with assumption and renunciation of agency.

[20] 	A notice of assumption of agency from a reading of the above provision is supposed to be filed and copies shall be served on the other party’s representative or legal practitioner. There was no notice of assumption of agency by the respondent’s legal practitioners, Hogwe Dzimirai and & Partners. The only reference showing that they were the lawyers for the respondent is found in their notice of response to the application for review by the appellant. No notice was filed prior to the filing of the notice of response.

[21]	The importance of transparency in regard to renunciation and assumption of agency was articulated by Gwaunza JA (as she then was) in Masiwa v Masiwa SC 46/2006 when she held as follows:

“The court going by its own Rules normally accepts the notices of renunciation and assumption of agency as indications of a litigant’s choice of legal practitioner where a change happens in the process of prosecuting his/her case. This is for convenience of the court and allows for order and efficiency in the prosecution of legal proceedings”

[22] 	The question that then ought to be asked is whether the respondent was in wilful default considering the fact that its legal practitioners had not filed a notice of assumption of agency. Before an applicant in a rescission of judgment application can be said to be in wilful default, he or she must have the knowledge of the action brought against him or her and of the steps required to avoid the default. Such an applicant must deliberately, being free to do so, fail or omit to take the steps which would avoid the default and must appreciate the legal consequences of his or her actions. The following was stated in the case of Zimbabwe Banking Corporation v Masendeke 1995 (2) ZLR 400 (S) at 402D:

“Willful default occurs when a party, with full knowledge of the service or set down of the matter, and of the risks attendant upon default, freely takes a decision to refrain from appearing …”

[23] 	The totality of the factual circumstances and an analysis of the full facts is therefore always important in cases such as this one in arriving at a proper conclusion as to whether the respondent had full knowledge of service or set down and hence was in wilful default. In casu, the appellant filed heads of argument at the respondent’s place of business. Such heads of argument were not served on the respondent’s legal practitioners. The result was that the respondent did not file its heads of argument, and a default judgment was awarded against it. The respondent’s non action was as a result of it not knowing that the appellant’s heads of argument had been filed. I do not find any unreasonableness in the court a quo’s reasoning that the respondent was not in wilful default. The court a quo was of the view that the respondent had given a reasonable explanation as to why it had not filed its heads of argument.

[24] 	The appellant in this appeal ought to have made and sustained allegations that the court a quo reached a decision that is unreasonable and wild in its defiance of logic. There is no indication in the appellant’s papers wherein he indicates that the court a quo reached its decision or exercised its discretion improperly. In the absence of such an allegation this Court cannot interfere in the findings of the court a quo. It has long been regarded as settled in this jurisdiction that this Court will not interfere with the discretionary findings of the lower court unless that decision is irrational. This Court has, in a number of cases, followed the general rule on whether to interfere or not which was expressed in Hama v National Railway of Zimbabwe 1996 (1) ZLR 664 (S) at 670 C-D where the court pronounced the following:

“The general rule of the law, as regards irrationality, is that an appellate court will not interfere with a decision of a trial court based purely on a finding of fact unless it is satisfied that, having regard to the evidence placed before the trial court, the finding complained of is so outrageous in its defiance of logic or of accepted moral standards that no sensible person who had applied his mind to the question to be decided would have arrived at such conclusion: Bitcoin v Rosenburg 1936 AD 380 at 395-7; Secretary of State for Education & Science v Metropolitan Borough of Tameside [1976] 3 All ER 665 (CA) at 671 E-H.”

[25] 	 A careful analysis of the findings of the court a quo reveals that it correctly and properly examined the evidence before it. This Court cannot lightly interfere with these findings so made. Considering the totality of the circumstances, it cannot be said that there was a wilful default as the respondent was under the impression that the same heads of arguments had also been forwarded to their legal practitioners.

[26] 	In this matter, I am of the view that in the interests of justice this is not one of those cases whereby a litigant is punished for the sins of his lawyers. I am therefore inclined to agree with the sentiments of Gwaunza JA (as she then was) in the case Masiwa v Masiwa (supra) at page 4 wherein she held that:

“Legal practitioners normally do not require specific instructions to that effect.  All that the applicant was required to do was indicate her preference as to which of the two firms was to represent her in view of the changes that had taken place. It would therefore be an injustice to the applicant if the consequences of this default were visited on her.  For this reason I will condone the non-filing of the notices in question.” (emphasis added).

[27] 	In respect of the issue relating to the third charge, from the record, it can be noted that the application for review was filed on 16 December 2014. The disciplinary hearing relating to the third charge commenced the next day on 17 December 2014.  In the application for review, the appellant himself alleged that ‘a perusal of the charge sheet showed that the applicant had been suspended on the basis of the same charges which had been settled on 27 November 2014, the notable exception being the third charge which had been added and particularised as the unauthorised use of a company vehicle for personal use.’ As the hearing had not yet commenced, the appellant could then not seek to have charge 3 reviewed. There was therefore nothing that the court could review.

[28] 	Be that as it may, the appellant’s grounds for review show that he only had two grounds for review. The first ground was that the disciplinary proceedings in relation to charges 1 and 2 which were settled and resolved in terms of s 93 (1) and (2) of the Labour Act by the Labour officer on 27 November 2014 be declared unlawful, irregular and therefore null and void. The second ground for review was that he had been denied his right to a fair hearing owing to the respondent’s refusal to pay his arrear salaries which he intended to use to secure legal representation. There is no indication in the application for review that the appellant sought to have the third charge reviewed.

[29] 	 The third charge that had been added through the appellant’s heads of argument had not been heard by the time that application was filed. I am in agreement with the court a quo to the extent that it held that ‘the court had erroneously included para 2 dealing with charge number 3 in the order.’

DISPOSITION

[30] 	The circumstances of this case warrant that the partial rescission of the judgment granted in default by the court a quo be upheld. The court below did not err in that respect. There was no wilful default by the respondent who also has a bona fide defence on the merits. The costs must follow the outcome.

Accordingly it is ordered as follows:

“The appeal is dismissed with costs.”

GWAUNZA DCJ:			I agree

MAKONI JA:				I agree

Mashuma Law Chambers, appellant’s legal practitioners

Hogwe Nyengedza Attornerys, respondent’s legal practitioners