GARWE
JA:
This
is an appeal against the judgment of the High Court, Harare handed
down on 13 July 2005 in which the High Court granted with costs an
application by the respondents declaring, inter
alia,
that they were entitled to payment of a mileage allowance of 4,000
kilometres per month calculated at the Automobile Association of
Zimbabwe (AAZ) rates.
The
facts of this case are these.
The
respondents were employed by the appellant as Assistant Director,
Credit Risk and Assistant Director, Debt Recovery, respectively. Both
respondents signed revised contracts of employment in the year 2000
which stipulated their conditions of employment. The contract of
employment provided in paragraph 3 as follows:
“3.
Motor
Vehicle Use
You
are entitled to the use of an Agribank company car under the
prevailing terms and conditions. You are required to familiarize
yourself with the existing rules and regulations for the use and
disposal of the motor vehicle.
or
You
are entitled to purchase a motor vehicle under the prevailing motor
vehicle scheme. You will use the car for business and claim in
accordance with the existing rules and as amended from time to time.
You
are also entitled to a mileage allowance based on a mileage of 4,000
kilometres per month at the applicable standard AAZ rates.”
(underlining my own)
The
underlined portion of para 3 is at the centre of the dispute in this
matter.
By
letter dated 30 August 2001, the appellant's Human Resources
Manager wrote to the respondents advising them that following the
restructuring of management grades the appellant's Board had
approved the conversion of the company car scheme to a personal car
scheme under the managers and field staff motor vehicle scheme with
effect from 1 September 2001.
The
conversion to a personal car scheme was done without reference to the
respondents.
The
conversion meant that the use of a company car was being done away
with and the respondents would no longer access fuel and other
facilities previously offered by the Bank in this regard. The
respondents were offered a loan equivalent to the purchase price of
their existing company vehicles and a monthly allowance of $30.300.00
to assist in “the cost of running the motor vehicle”.
It
appears the respondents were not happy with the conversion to the new
scheme and on 3 September 2001 wrote a letter to management raising
various issues on the matter and threatening legal action because of
what they perceived as a breach of contract.
One
of the issues raised was their entitlement to an allowance based on a
monthly mileage of 4,000 kilometres.
The
response by the Managing Director of the appellant was that such an
allowance “would ultimately be too expensive for the Bank to
sustain” and that the change had been “influenced by the
magnitude of the vehicle allowance cost and its sustainability”.
Thereafter,
the parties engaged in considerable exchange of correspondence on the
matter. The respondents continued to insist that they were entitled
to the allowance. The appellant maintained that it could not justify
payment of such a huge allowance.
The
appellant eventually stated by letter dated 14 April 2004 that the
allowance had been included by mistake and that the intention had
been to allow the respondents to use their personal vehicle and
submit claims for such use under the Bank's prevailing terms and
conditions.
In
June 2004, the respondents then filed a court application seeking,
inter
alia,
a declarator
that they were entitled to payment of the allowance.
After
hearing both parties, the High Court granted the application with
costs. It is against that decision that the appellant has appealed to
this Court.
The
decision of the court a
quo
is attacked on four bases. These are:
(i)
firstly that the court a
quo
erred in finding that the inclusion of the allowance in question was
not the result of a mistake;
(ii)
secondly that the court a
quo
erred in dismissing the appellant's defence of waiver;
(iii)
thirdly that the court a
quo
erred in failing to take into account the fact that in terms of the
contract of employment agreed to by the respondents, the appellant
could change its policies and procedures; and
(iv)
fourthly that the court a
quo
erred in coming to the conclusion that it had jurisdiction to
determine what was essentially a labour dispute contrary to the
provisions of section 89(6) of the Labour Act [Cap
29:01].
I
proceed to deal with each of the four grounds raised.
WHETHER
THE HIGH COURT HAD JURISDICTION TO DETERMINE THE APPLICATION
It
is the appellant's contention that what was before the court a
quo
was essentially a labour dispute and in the light of the provisions
of section 89(6) of the Labour Act [Cap
28.01], only the Labour Court has the jurisdiction in the first
instance to hear and determine such a matter.
In
support of its argument, the appellant has cited the case of Sibanda
& Anor v Bensen Chinemhute & Anor
HH131-2004. In that case MAKARAU J (as she was then) made the
following remarks at p7:
“Consequent
upon my finding above, that this court is only barred from exercising
its inherent jurisdiction in labour matters where the Labour Court
has jurisdiction, it appears to me that this court retains its
jurisdiction to grant declaratory orders in terms of section 14 of
the High Court Act in labour disputes …”.
The
learned judge continued at p8 of the cyclostyled judgment:
“Similarly,
I hold that in the absence of the specific power on the part of the
Labour Court to issue a declaratory order as competent relief to
parties appearing before it, the jurisdiction of this court to do so
in the first instance has not been ousted.”
The
above case does not in fact support the appellant's contention that
the High Court has no jurisdiction to hear the application. To the
contrary the case is authority for the proposition that the High
Court retains its original jurisdiction to grant declaratory orders,
even in labour disputes.
The
appellant has not sought to argue that that case was wrongly decided.
In
Johnson
v AFC
1995 (1) ZLR 65 (H) GUBBAY CJ had occasion to consider when a
declarator
can
be granted. The learned Chief Justice remarked at p72 E-F:
“The
condition precedent to the grant of a declaratory order under section
14 of the High Court of Zimbabwe Act 1981 is that the applicant must
be an 'interested person', in the sense of having a direct and
substantial interest in the subject matter of the suit which could be
prejudicially affected by the judgment of the Court. The interest
must concern an existing, future or contingent right. The court will
not decide abstract, academic or hypothetical questions unrelated
thereto. But the presence of an actual dispute or controversy between
the parties interested is not a pre-requisite to the exercise of
jurisdiction …”.
It
was not in contention before the court a
quo
that the respondents were interested persons. The only issue for
determination was whether the case was a proper one for the exercise
of discretion under section 14 of the High Court Act.
The
trial court reached the conclusion that it was.
The
fact that the dispute could well have been determined in the Labour
Court is not the determining factor. In Johnson
v AFC supra,
GUBBAY CJ remarked at p77B:
“Nor
does it seem to me that the availability, in the same court, of a
remedy by way of interdict was of itself reason to refuse declaratory
relief. Standing alone, it will seldom be sufficient to induce a
court to decline jurisdiction. It is but one factor to be taken into
account by the court in the exercise of its discretion whether or not
to make a declaration of rights …”
See
also Herbstein & Van Winsen, The
Civil Practice of the Supreme Court of South Africa,
4 ed, p 1058.
I
am of the view that the court a
quo
was correct in coming to the conclusion that it had the jurisdiction
to deal with the matter. Paragraph 1 of the order granted by the
court a
quo
was clearly declaratory.
This
ground of appeal must therefore fail.
THE
QUESTION OF WAIVER
The
appellant has argued that the court a quo should have dismissed the
application on the ground that the respondents had by their conduct
waived whatever rights they might otherwise have had.
In
terms of the common law, there is a presumption against waiver. R H
Christie in the Law
of Contract in South Africa,
3ed states at p 488:
“Having
gone to all the trouble to acquire contractual rights people are, in
general, unlikely to give them up. There is therefore a presumption,
even in some cases a strong one, against waiver. That means not only
that the onus
is upon the party asserting waiver to prove it, but that although, as
in all civil cases, the onus
may be discharged on a balance of probability, it is not easily
discharged….
To
this it is only necessary to add that it has repeatedly been held
that clear proof is required, especially of a tacit as opposed to an
express waiver …”.
Attention
is also drawn to the judgment of this Court in Philemon
Chidziva & 4 Ors v Zimbabwe Iron & Steel Company
SC137/07.
In
dealing with this argument, the trial Judge stated at p4 of the
cyclostyled judgment:
“The
respondent further submitted that the applicants must be held to have
waived their rights by not bringing up the matter to court timeously.
The submission is clearly devoid of any merit when regard is had to
correspondence filed of record in which the respondent admits that
the applicant never manifested any signs of abandoning their rights.
On 25 September 2001 the managing director acknowledged that the
applicants' memorandum raised the issue of 'legal action
insinuated because of perceived contractual agreement violation'.
On 5 June 2003 the Human Resources Manager, in response to another
communication from the second applicant, also acknowledged that the
matter was first raised in 2001 and as far as the bank was concerned
it had been deliberated upon to its finality then. The above
statement was clearly misleading. The bank never said it had made a
mistake at that stage. The issue was therefore very much alive.
Finally
the bank, in the final memorandum of 14 April, acknowledged that the
matter had been brought up on a couple of times since 2001. In such
circumstances it cannot be said that the applicants abandoned their
rights when the requirements of a waiver were not met at all.”
I
agree with the trial Judge in this respect.
At
no stage did the respondents suggest that they were abandoning their
entitlement to the allowance. They immediately wrote to management on
3 September 2001, voicing their concern at what they considered was a
breach of their contract of employment and even threatened legal
action.
Although
it appears that they did request for the extension of the period
within which to repay their loans at no time did they waive their
entitlement to the allowance.
It
is also not correct, as suggested by the appellant, that the
respondents did not assert their rights for more than twenty months.
The correspondence on file shows that the respondents immediately
complained and, as already noted, even threatened to take legal
action.
Even
if it were to be accepted for a moment that there was such a delay
our law is clear that:
“Delay
in enforcing a contractual right is not necessarily a waiver of the
right. One can go further and say that delay, of itself and without
more, can never deprive a party of a contractual right except by
prescription…”- R H Christie op.
cit.,
at p 491.
This
ground of appeal must also fail.
THE
DEFENCE OF MISTAKE
It
is the appellant's contention that the allowance was never intended
and that it was inserted by mistake. If, so the appellant argues, the
allowance were to be paid this would result in the respondents being
paid twice in the sense that they would be entitled to motor vehicle
loans to purchase motor vehicles and at the same time receive
allowances for the use of the same vehicles based on a monthly
mileage of 4,000 kilometres at standard AAZ rates.
A
party to a contract relying on an error of judgment who can go
further and show that at the time of the contract he was labouring
under some misapprehension may escape liability under a contract.
The
onus
however is not easy to discharge. As stated by RH Christie, The
Law of Contract in South Africa op. cit.,
p353:
“Unless
the mistaken party can prove that the other party knew of his
mistake, or that as a reasonable man he ought to have known of it, or
that he caused it, the onus
of showing that the mistake was a reasonable one justifying release
from the contractual bond will not be easy to discharge.”
The
learned author continues at p354:
“However
material the mistake, the mistaken party will not be able to escape
from the contract if his mistake was due to his own fault. This
principle will apply whether his fault lies in not carrying out the
reasonably necessary investigations before committing himself to the
contract… and in fact in any circumstances in which the mistake is
due to his own carelessness or inattention, for he cannot claim that
his error
is iustus.”
In
responding to concerns by the respondents that the appellant had
breached the contract of employment, the Managing Director of the
appellant made it clear that the appellant had made a mistake as it
could not justify these allowances or sustain them. He went on to
state that the allowance was almost equivalent to the respondents'
monthly salary and was by implication too high.
The
trial court observed that during a period of two years and eight
months the appellant had not at any stage alluded to the possibility
of such an allowance having been included by mistake. He noted that
the appellant made this assertion for the first time on 14 April
2004.
The
trial Judge remarked as follows on pp 3-4 of the judgment:
“As
can be seen from the above memorandum the respondent was then being
categoric that it had made a mistake a thing it failed to do during
the couple of times the matter had been brought up since 3 September
2001.
The
matter would not have dragged this far if the respondent had stated,
the first time the matter was raised, that the inclusion of the
allowances was a mistake.
The
suggestion, in the memorandum, that the allowances whose payment the
applicants sought were not intended and the Bank did not regard them
as part of the applicants' contract is simply untenable. If the
respondent did not intend the allowances to be part of the contract,
it would have removed them from the contract document at the time it
amended the contract by removing the first option which related to
the use of company vehicles.
Further
when one examines the contract document filed of record it reveals
that 4,000 kilometres was hand written while about 99% of the
document was type written. There are also some figures that were hand
written such as the salary, annual bonus, clothing allowance, the
vacation and occasional leave etc. There can be no doubt that these
were inserted into the blank spaces after careful thought. It seems
to me that the same applies to the 4,000 kilometres.
The
suggestion, therefore, that the inclusion of the entitlement of a
mileage allowance based on mileage of 4,000 kilometres per month at
the applicable standard AAZ rates, was inserted by mistake is equally
untenable.
If
at all it had been a mistake the respondent would have immediately
realized it and would have said so when the applicants first raised
the issue on 3 September 2001 failing which respondent would have
realized and said so at any other subsequent occasion the applicant
raised it in 2001 or early 2002 or even 2003. It therefore seems to
me that if at all the respondent had made a mistake then such mistake
was grossly unreasonable.”
I
am inclined to agree with the above observations.
It
is apparent in this case that when the appellant made provision for
this allowance in the contract of employment there was no question of
mistake at that stage. That allowance was what the appellant was
prepared to offer the respondents. Later, however, the appellant had
a change of heart because of the amounts involved which were
calculated using AAZ rates. It considered the allowances as too high
and unsustainable.
The
position is now settled that an offeror cannot escape liability by
establishing that he has made a wrong offer which was accepted –
University
of Zimbabwe v Gudza
1996 (1) ZLR 249 (S), 253 D-E.
The
offeror will not be permitted to rely on the absence of the consensus
if the mistake was due to his own carelessness – University
of
Zimbabwe
v Gudza supra
at p 254B-C.
I
accordingly reject the appellant's argument that the court a
quo
erred in rejecting its claim that the allowance had been inserted by
mistake.
WHETHER
THE APPELLANT COULD ALTER THE RESPONDENTS' CONDITIONS OF SERVICE
The
appellant has argued that, in terms of para 11 of the contract of
employment, the respondents undertook to subscribe to the Bank's
policies and procedures currently in use and as revised and amended
from time to time. Pursuant to this clause, so it is argued, a
revised motor vehicle scheme came into existence with effect from 1
September 2001.
I
do not accept that on the basis of para 11 of the contract of
employment, the appellant was empowered to remove, without reference
to the respondents, such a fundamental right as the entitlement to
payment of a monthly mileage allowance.
If
the appellant's argument were to be taken to its logical
conclusion, on the basis of that paragraph, even the respondents'
salaries could have been reduced.
I
do not accept that the Bank in amending its policies and procedures
was empowered to alter clearly defined contractual rights to payment
of a salary and allowances.
Clause
3 of the contract of employment clearly states that the respondents
were:
“…
entitled
to a mileage allowance based on a mileage of 4,000 kilometres per
month at the applicable standard AAZ rates.”
Such
an entitlement could not be changed, altered or amended at whim on
the basis that the appellant was entitled to change its policies and
procedures from time to time. A party to a contract cannot
unilaterally alter the terms and conditions of the contract in these
circumstances.
This
submission must also fail.
In
the result, I find that this appeal has no merit.
The
appeal is dismissed with costs.
SANDURA
JA: I agree
ZIYAMBI
JA: I agree
Chinamasa,
Mudimu, Chinogwenya & Dondo,
appellant's legal practitioners
Kantor
& Immerman,
respondents' legal practitioners
