HUNGWE
J:
The
applicant seeks the grant of an order in the following terms:
“1.
That on service of this order upon the second respondent, the said
second respondent cause to be paid out of its account with the third
respondent such a sum as will satisfy the judgment issued out of this
Honourable Court in cases number HC6220/13 and HC10786/14.
2.
That should the second respondent fail to pay the applicant as
required in terms of paragraph 1, then the third respondent is
restrained from paying to the second respondent any proceeds in an
account No. 06109-01120051570077, Kwame Nkrumah Branch in Harare.
Instead, the third respondent is directed to pay to the applicant
such sums as will satisfy the court judgment due to the applicant.
3.
That the first and second respondents shall pay the costs of this
application.”
The
applicant obtained an arbitral award in his favour against first
respondent. It was subsequently registered as an order of this court
under HC6220/13 on 21 October 2013. Upon service of the court order,
the first respondent neglected or failed to pay the amount stated in
the order. Applicant then obtained a writ of execution against the
first respondent. The Sheriff of this court attempting to attach
monies held in a bank account with the third respondent. It turned
out that the account did not belong to the first respondent but to
the second respondent.
Applicant
then made application to this court seeking to join second respondent
as a judgment debtor in the writ of execution proceedings under HC
10786/14.
In
the absence of opposition, the applicant obtained an order against
the second respondent in default. As all the processes unfolded, the
applicant remained on the payroll of the first respondent. This was
in spite of the fact that the subject matter of the writ was his
retrenchment package. In 2016 his employment with second respondent
was terminated in terms of a law that did not entitle him to a
lucrative severance package. That law entitled him to a leaner exit
package than that offered under the retrenchment scheme. His salary
was ceased. He then mounted these proceedings in order to execute the
order of court entitling him to receive a retrenchment package
aforesaid.
The
first and second respondents oppose the grant of the order sought on
various grounds which I will advert to in due course.
In
his founding affidavit, the applicant's averments revolved around
how he had acquired proprietary rights, title and interest in the
arbitral award made in his favour by an independent arbitrator. He
narrates how the respondents had constantly evaded payment by resort
to one excuse or the other. He avers that by reason of his entrenched
constitutional right, he was entitled to the enjoyment of his right
to property, which right the respondents have breached by failing to
pay.
There
is no doubt that terminal benefits of an employee are an accrued
benefit. As such, the applicant would naturally have a right to,
either by virtue of the arbitral award or by virtue of his right to
terminal benefits in terms of his contract of employment. In short,
the applicant has a contingent right that has accrued to him.
However,
as matters stand, it would appear that the true nature and extent of
those rights are under dispute as between himself and the
respondents. I mention this as fact because the first respondent has
challenged the judgment that led to the issuance of the writ of
execution i.e. HC6220/13. First respondent has filed an application
for rescission of the judgement. Second respondent has also filed an
application for rescission of the order of this court joining it as a
judgment debtor in a matter to which it was not party to i.e. Case
No. HC 10786/14.
In
order to deal exhaustively with the basis of the application, I
proceed to consider the issues raised in the sequence in which they
appear in the applicant's heads of argument.
1.
Whether the respondents are in contempt of court and therefore should
not be heard
Applicant
contends that because the two respondents have not complied with the
order of this court compelling them to pay the amount awarded to him
by the arbitrator, the respondents should be held to be in contempt
of court and therefore cannot be heard unless they first purge their
contempt.
The
respondents deny that they are in contempt of court. First and second
respondents contend that they have approached this court for
rescission of the two judgments under HC2005/17 and HC2050/17. Both
respondents have raised several defences to the claim by the
applicant.
First
respondent's contention is that there was a novation of the 2010
agreement to retrench which was accepted by the applicant when he
agreed to continue in employment after the Notice to Retrench had
been given. He had continued drawing a salary on a monthly basis
until his employment was terminated on notice in 2015. His terminal
benefit in terms of that notice to terminate employment was only a
sum of about US$9,131.08 as opposed to the US$88,878.67 awarded by
the arbitrator which was beyond its capacity to pay at once. In any
event, the first respondent maintained, its assets were protected by
section 24 of the Finance Act No. 8 of 2015 which categorized it as a
State entity. Finally, the first respondent took the point, in that
application for rescission, that applicant had failed to give the
required notice before proceeding against it in terms of the State
Liabilities Act [Chapter
8:14].
Second
respondent in HC2050/17 seeks rescission of the order under
HC10786/14 on the basis that it was not a party to the proceedings in
HC6220/13 in which the applicant obtained registration of the
arbitral award against first respondent. For it to be joined at
execution stage was highly irregular. In any event, so the argument
went, the Supreme Court had, in Air
Zimbabwe (Pvt) Ltd and Air Zimbabwe Holdings (Pvt) Ltd v Nhuta
2014 (2) ZLR 333 long held that second respondent was not a successor
company to Air Zimbabwe Corporation, the basis upon which the order
in HC10786/14 was granted. Consequently, second respondent could not
be liable for the debt accruing to the applicant. The respondent
urged this court to hold that since they have approached this court
seeking the indulgence of rescission, they cannot be held in contempt
of court. Respondents argue that there is a real likelihood that the
applications for rescission will meet with success in that all that
they are required to show is good and sufficient cause. Deweras
Farm (Pvt) Ltd & Ors v Zimbabwe Banking Corporation
1997 (2) ZLR 47.
To
my mind, the arguments raised in the rescission applications are
arguable.
In
light of the above, I am satisfied that the respondents are not in
contempt and therefore dismiss this point in
limine.
2.
Does the mis-citation of an Act of Parliament render it invalid?
The
second point in
limine
raised in the application was that the Finance Act No. 8 of 2015
erroneously cited the State Liabilities Act as [Chapter
22:13] instead
of [Chapter
8:14].
As such, the Finance Act is invalid.
Before
the repeal of the Statute Law Compilation and Revision Act, [Chapter
1:03]
this would have been well taken. The answer to that is that the
section of the Statute Law Compilation and Revision Act [Chapter
1:03]
relied upon by the applicant was long repealed and therefore no
longer applicable. As matters stand, a mis-citation or an erroneous
citation of an Act of Parliament does not render it invalid. The
point in
limine
is therefore dismissed.
3.
Is the State Liabilities Act [Chapter 8:14] unconstitutional?
The
third point in
limine
was that section 5(2) of the State Liabilities Act [Chapter
8:14]
is unconstitutional as it deprives applicant of the right to
property.
The
argument requires me to make a finding of constitutional invalidity
of an Act of Parliament and immediately act on it. This is clearly
not the position at law. Whilst this court is vested with the power
make such a finding, that is not the end of the matter. It is only
after the Constitutional Court has confirmed such a finding that an
Act of Parliament can only then be regarded as unconstitutional. In
any event, the procedure adopted by the applicant prevents me from
making such a determination as the point was raised in limine. No
full argument was presented on the issue and therefore this court is
unable to decide it on the merits. There has been no prior
declaration of constitutional invalidity by the superior court of the
Act.
Consequently,
the applicant's points in
limine
fail.
There
are other grounds to dismiss this application on the merits.
Applicant
brought the application for a garnishee order under Order 32 rule
226(1)(a) of the High Court Rules, 1971. (see page 1 of the papers).
That rule provides:
Order
32 r 226 (1) (a) of the High Court Rules, 1971
“226.
Nature of applications
(1)
Subject to this rule, all applications made for whatever purpose in
terms of these rules or any other law,
other
than applications made orally during the course of a hearing, shall
be made -
(a)
as a court application, that is to say, in writing to the court on
notice to all interested parties; or
(b)
as a chamber application, that is to say, in writing to a judge.
(2)
An application shall not be made as a chamber application unless -
(a)
the matter is urgent and cannot wait to be resolved through a court
application; or
(b)
these rules or any other enactment so provide; or
(c)
the relief sought is procedural or for a provisional order where no
interim relief is sought only; or
[Paragraph
amended by s.i. 101 of 1994]
(d)
the relief sought is for a default judgment or a final order where—
(i)
the defendant or respondent, as the case may be, has previously had
due notice that the order will be sought, and is in default; or
(ii)
there is no other interested party to the application; or
(iii)
every interested party is a party to the application; or
(e)
there are special circumstances which are set out in the application
justifying the application.“
Clearly,
this is not the rule under which to bring an application of this
nature. The appropriate rule is to be found under Order 42 titled
Attachment
Of Debts.
Orde
42 Rule 377 provides:
“ORDER
42
ATTACHMENT
OF DEBTS
377.
Court Application for attachment of debt due to judgment debtor
A
judgment creditor who has obtained a judgment or order for the
recovery or payment of money, which judgment
or order is unsatisfied, may make a court application for an order
that any
money at present due or becoming due in the future to the judgment
debtor
by a third party within the jurisdiction (hereinafter called “the
garnishee”) shall be attached. (my emphasis).
[Rule
amended by s.i. 43 of 1992]
377A.
Preliminary notice of application where State is garnishee
(1)
No sooner than fourteen days before applying for a garnishee order
against the State for the attachment of salary or wages owed by the
State to a judgement debtor, the applicant shall cause written notice
of the application,
together with the supporting documents that will be filed with the
application, including a copy of the judgment or order which created
the judgment debt concerned and the judgment creditor's affidavit
setting forth the amounts still due to him in terms of the judgment
or order, to be served on—
(a)
the Director of the Salary Service Bureau and the head of the
Ministry, department or force in which the judgment debtor is
employed, where the judgment debtor is employed by the State
otherwise than in the Zimbabwe National Army or in Parliament; or
(b)
the Chief Paymaster of the Zimbabwe National Army and the Commander
of the Army, where the judgment debtor is employed in the Zimbabwe
National Army; or
(c)
the Director of the Salary Service Bureau and the Secretary to
Parliament, where the judgment debtor is a member of the staff of
Parliament or is a Senator or a member of the House of Assembly.
(2)
A notice in terms of subrule (1) shall set forth the date on which
the application for the garnishee order is to be made and sufficient
information to identify the judgment debtor, including—
(a)
his full names; and
(b)
his employee code number or force number; and
(c)
the Ministry, department, force or institution in which he is
employed, as appropriate.
(3)
As soon as possible after receiving a notice in terms of subrule (1),
the Director of the Salary Service Bureau
or the Chief Paymaster of the Zimbabwe National Army, as the case may
be, shall send the applicant for the garnishee order and the judgment
debtor a notice setting forth—
(a)
the amount of any money that is or will be payable to the judgment
debtor by way of salary or wages; and
(b)
the amount and nature of any deductions required to be made from such
salary or wages by the Director or Chief Paymaster; and
(c)
the earliest date from which any payment may be made in terms of a
garnishee order.
[Rule
inserted by s.i. 144 of 1985]”
I
have cited the full provision for ease of comparison. Where the
garnishee is the State as an employer, the requirements are set out
in the above rule.
Applicant
ought to have made an application for attachment under r 377.
Despite
his referring the application as having been brought under Order 32,
I approach the matter on the basis that applicant has brought it in
terms of r 377 as it is clear that was his intention. By comparison,
it will be seen from the provisions in r377A that such an application
is by notice directed at the officer holding money
at present due or becoming due in the future to the judgment debtor.
The
question whether money held by a bank on behalf of a judgment debtor
was “money
at present due or becoming due in the future to the judgment debtor”
was considered in Muvengwa
v Matarutse & Another
1968 (4) SA 752 (R). The headnote of that case reads:
“A
judgment creditor applied for the attachment of a debt alleged to be
due or accruing to the first respondent, the judgment debtor, in
terms of Order 47 of the High Court Practice and Procedure Act (R).
He alleged that the garnishee, a bank, was indebted to the judgment
debtor in an amount standing to his credit in his savings account
with the bank. Under the conditions under which the judgment debtor
had deposited the money, withdrawals above £100 were subject to
notice and the judgment debtor had to apply personally, bringing his
book. The applicant requested the Court to authorise the Sheriff to
fulfil the stipulations which the judgment debtor was required to
fulfil before money became payable to him.
Held,
that the money had to be due or accruing at the time when the
attaching order was served: the Court was not entitled to change the
method of payment, alter the contractual obligations of the parties
or render an amount due which was in fact not due or accruing due on
the relevant date. Application accordingly dismissed.”
It
is clear that in order to meet the requirements in r377, the
applicant needed to have shown, first, that the money held by the
garnishee on behalf of the judgment debtor, is a specific amount of
money standing to the credit of the respondents sufficient to meet
the sum in the order. Second, applicant would have to show that this
money is due and owing in the sense intended in r 377. In terms of r
377 an applicant must prove that an amount is “money
at present due or becoming due in the future”
by the garnishee to the judgment debtor.
I
must therefore determine whether the money standing to the credit of
the respondents in third respondent's account qualifies as such.
There
is admittedly no evidence led by the applicant on the amounts
standing to the credit of the respondents held in their accounts with
the third respondent bank; the terms and conditions thereof or
whether the sheriff will be in the same or more favourable position
than the judgment debtors should this court grant the order sought.
In other words, the terms of the contract regulating the withdrawals
of the money in that account are not known. A court must avoid
granting an order that is brutum
fulmen.
There therefore need to show that the money held by third respondent
is standing to the credit of the judgment debtor otherwise how does
the sheriff execute if there is merely an overdraft facility upon
which the respondents are drawing down? Without evidence of the
specific amount standing to the credit of the respondents as judgment
debtors, there is no knowing the efficacy of the order granted.
Unless applicant shows, on the papers, that there is a specific
amount standing to the respondents' credit or that a specific
amount will become due to the respondents by the garnishee in future,
it cannot be said that he is entitled to the order sought. The point
I make here is that the order sought, without the detail I have
referred to above, is too vague and therefore unenforceable.
It
is therefore in my view not “money
at present due or becoming due in the future”
as contemplated in the rules.
Similarly,
in Mugabe
Mutezo & Partners v
Barclays Bank of Zimbabwe Limited & Another 1989
(3) ZLR 162 this court held that where a garnishee order is granted
under Order 42 of the Rules of the High Court, it takes the form of
an order for attachment and payment, that is, for execution.
Once,
he obtains a garnishee order, there is no need for the judgment
creditor thereafter to institute fresh proceedings at common law in
order to secure payment. The garnishee order itself is directed at
the garnishee and requires him to pay over the sum stated in the
order. Non-compliance with the order would constitute a contempt of
court. It follows, in my view that this the court cannot do unless it
is equipped with sufficient information as would enable it to issue
an efficacious order. In the absence of the vital information that I
have referred to, an application of this nature cannot succeed.
Rule
378(1) of the Rules of the High Court requires a judgment creditor
who wishes to obtain a garnishee order to show, to the court's
satisfaction, that the garnishee is indebted to the judgment debtor.
The applicant has not shown that the garnishee is indebted to the
judgment debtor. In the event the court cannot grant a garnishee
order in the absence of the fulfilment of this requirement.
The
respondents raised other grounds upon which they resisted the order
sought. In light of the above I do not find it necessary to make any
findings on the grounds so advanced on respondents' behalf. Suffice
it to say that I find that the applicant had not met the criteria set
out in r 377 of the High Court Rules, 1971.
Consequently,
the application is dismissed with costs.
Kawonde
Legal Services,
applicant's legal practitioners
Mutumbwa
Mugabe & Partners,
1st
& 2nd
respondents' legal practitioners
