First Mutual Life Assurance v Jackson MuziVi

### Preamble
Judgement No. SC 95/20
1
Civil Appeal No. SC 583/18
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REPORTABLE  (84)

FIRST     MUTUAL     LIFE     ASSURANCE

v

JACKSON     MUZIVI

SUPREME COURT OF ZIMBABWE

MAKARAU JA, GUVAVA JA & MAVANGIRA JA

HARARE: MARCH 03, 2019 & JULY 3, 2020

F. Girach, for the appellant

T. Maune, for the respondent

MAVANGIRA JA: 	This is an appeal against the whole judgment of the Labour Court sitting at Harare. The appellant was aggrieved by the assumption of jurisdiction by the court    a quo in an application for the conversion to United States dollars of part of an award that sounded in Zimbabwean dollars. The award was granted by the court a quo and had subsequently been registered with the High Court.

FACTUAL BACKGROUND

The Labour Court issued a judgment in 2011 in favour of the respondent. Part of the judgment was in United States dollars whilst the other part was in Zimbabwean dollars. On 17 May 2016 the judgment was registered with the High Court at the instance of the respondent, in terms of s 92B (3) of the Labour Act [Chapter 28:01] (the Labour Act). The respondent executed the part of the judgment that sounded in United States dollars. Upon realisation that execution of the Zimbabwean dollar component could not be effected as the Zimbabwean dollar was then valueless, he sought to have a writ of execution issued on the basis of his own conversion of the Zimbabwean dollar award to the United States dollar equivalent of the same.

The sum effect of his conversion gave a United States dollar equivalent of US$46 926 350.53 (forty-six million nine hundred and twenty-six thousand three hundred and fifty United States dollars and fifty-three cents) against the Zimbabwe dollar total of ZW$864 852 640.18 that was awarded by the Labour Court.

The registrar of the High Court declined to issue the said writ.

Having thus failed to effect execution in this manner, the respondent made an application to the Labour Court for it to convert to United States dollars the outstanding and unsettled part of the award sounding in Zimbabwean dollars. The appellant opposed the application on the grounds that the court a quo was functus officio and had no jurisdiction to entertain the application and that the matter was res judicata. The appellant further argued that the decision of the Labour Court obtained in 2011 had superannuated by the time it was registered in the High Court in 2016.

DETERMINATION BY THE COURT A QUO

The court a quo found the appellant’s arguments to be without merit. Regarding the argument that the judgment had superannuated, it held that when its order was registered with the High Court it became a civil judgment and that in terms of s 15 (a) (ii) of the Prescription Act [Chapter 8:11] the applicable period of prescription for the judgment debt was thirty years. It also held that in any event, the decision of the Labour Court itself, even before registration, also gave rise to a judgment debt which would also only prescribe after thirty years.

The court a quo further found that it had jurisdiction to entertain the matter and placed reliance primarily on the authority of the case of Fleximail (Pvt) Ltd v Samanyau & Ors SC 21/14(Appeal No SC 135/11) (Fleximail). It held that it was not functus officio as it was not being asked to correct or alter its judgment. It opined that it had not fully exercised its authority over the matter as the prior proceedings did not concern the same subject matter that was now placed before it. It thus held that it had the jurisdiction to convert the amount owing in Zimbabwean dollars to United States dollars because of its equitable jurisdiction conferred to it by virtue of s 2A of the Labour Act.

The court a quo further found that the matter was not res judicata on the basis that what was initially before it was the issue of the respondent’s entitlement to damages for unlawful termination of employment whereas the subject matter of the applicant at hand was whether the Zimbabwean dollars could be converted to United States dollars and the applicable conversion rate.

The court held that it had the “necessary and requisite authority to entertain the matter before it.” It then proceeded to state as follows:

“Whilst the applicant (respondent) has filed before the court several correspondence giving what it considered to be the suitable conversion rate. (sic) The respondent has not made any submissions on this aspect.

It is fair and just that I give the respondent (appellant) an opportunity to make submissions on this aspect and allow the applicant to file its response thereto before I can decide on the applicable conversions (sic) rate.”

The court a quo then proceeded to make the following order:

“1.  The court has the requisite jurisdiction to entertain

this matter.

2.   The special plea of res judicata is dismissed for being without merit.

3.   The argument that the court is functus officio is dismissed for being without merit.

4.    The argument that the judgment has superannuated is also dismissed as being devoid    of merit.

5.   The parties are to file their heads of argument dealing with the issue of what is the applicable conversion rate from Zimbabwean dollars to United States dollars.

6.   The applicant will file its heads on or before 30 June 2017 and the respondent will file its response on or   before 18 July 2017. The Registrar will set the matter   down for continuation this term on any date after 18 July at 10.30 am on notice to both sides.

7.  There is no order as to costs.”

Aggrieved by this decision, the appellant did not file any heads of argument as stipulated in the order but proceeded to note this appeal on the following grounds:

GROUNDS OF APPEAL

The court a quo erred in holding that it had jurisdiction to supplement or alter an order of the High Court in the absence of such powers in terms of a statute. As a creature of statute, the court a quo could only exercise jurisdiction within the structure of the enabling law.

A fortiori, the court a quo erred in dealing with the matter in which it was functus officio as it had already rendered judgment in the same matter and had not been called upon to exercise any of its powers under s 92C of the labour Act [Chapter 28:01] or any other relevant law.

The court a quo erred in dealing with a matter that had superannuated in the absence of the revival of the judgment concerned. Concomitant to the aforementioned error of law the court a quo erred in re determining an order which had already been brought into execution.

SUBMISSIONS MADE BEFORE THIS COURT

The submission is made in heads of argument filed on behalf of the appellant that the jurisdiction of the Labour Court was not established and that the powers which the court arrogated to itself do not derive from the law. Furthermore, that the authorities cited by the court a quo wherein matters had been referred to it by this Court for it to exercise its equitable jurisdiction in the special task of conversion did not confer jurisdiction on the court in this particular matter as it was the referral or remittal by the Supreme Court in those matters that conferred the jurisdiction on the Labour Court. It is further submitted that the respondent ought not to have registered the order of the Labour Court with the High Court without first seeking the conversion that he was now seeking. It is also submitted that the Labour Court was functus officio in this matter.

In oral submissions Mr Girach, for the appellant, reiterated that the court a quo did not have jurisdiction to adjudicate over the matter. He submitted that after the Labour Court made its decision culminating in the order sounding partly in Zimbabwean dollars and partly in United States dollars, it had disposed of its judicial function. Furthermore, that upon the registration of the Labour Court decision in the High Court, that decision became an order of the High Court. The Labour Court thus had no jurisdiction to alter the decision as it had become functus officio.

Mr Girach further submitted that the court a quo misdirected itself in applying s 92C of the Labour Act to the facts of this matter. He argued that s 92C only applies where a patent error exists and that in the present matter the judgment of the Labour Court had not been made in error.

Miss Maune for the respondent, in response to questions from the court submitted that upon registration by the High Court, the decision of the Labour Court became that of the High Court. However, she thereafter further submitted that on the authority of The Cold Chain (Private) Limited t/a Sea Harvest v Robson Makoni CCZ 8/2017 the court a quo nevertheless had the requisite jurisdiction to convert the award.

ANALYSIS

The crisp issue that arises is whether the court a quo had the necessary jurisdiction to relate to the matter that was placed before it.

The Labour Act provides in s 89:

“89 Functions, powers and jurisdiction of Labour Court

The Labour Court shall exercise the following functions –

Hearing and determining applications and appeals in terms of this Act or any other enactment.”

In NRZ v Zimbabwe Railway Artisans’ Union & Ors 2005 (1) ZLR 341 (S) this Court stated at 346F – 347A:

“There is, I think, judging from the cases which have come before us, a misconception generally held by the Labour Court, namely, that it is, in terms of s89 of the Act, endowed with jurisdiction to entertain all applications brought before it. … Thus before an application can be entertained by the Labour Court, it must be satisfied that such an application is an application ‘in terms of the Act or any other enactment.’ This necessarily means that the Act or the other enactment must specifically provide for applications to the Labour Court, of the type that the applicant seeks to bring; see PTC v Chizema S-108-04 … thus the application and the remedies obtainable thereby must be authorised in the Act… nowhere in the Act is the power granted to the Labour Court to grant an order of the nature sought by the respondents in the court a quo …” (underlining added for emphasis)

The judgment of the labour Court as handed down in 2011 was not only complete but was competent at that time as the country was in a multi-currency regime. The court fully pronounced itself on the issue. There was therefore nothing to correct or alter. The court had rendered a final and executable judgment and this at law rendered the court functus. The position was clearly enunciated in City of Mutare v Mawoyo 1995 (1) ZLR 258 (HC) at 264D-F where MALABA J (as he then was), stated as follows:

“Randfontein Ests Ltd v Robinson was followed in West Rand Ests Ltd v New Zealand Ins Co Ltd 1926 AD 173 where INNES CJ and KOTZE JA undertook comprehensive analyses of the Roman-Dutch authorities on the subject of the nature and extent of the power of a court to alter its final orders. INNES CJ said at p176:

‘The general principle that a judge has no authority to amend his own order, duly pronounced, was well recognised by the civil law …

No correction of a judgment once given was permissible for the simple reason that the judex had ceased to function.’

The CHIEF JUSTICE went on to consider the exceptions to the general principle and stated at p 178 that -

The reason on which the general rule prohibiting the alteration of a judgment by the authority which pronounced it rested was that the judge who had once given a final order was functus officio. His jurisdiction having been fully exercised, his authority over the subject-matter ceased.”

The judgment of the Labour Court was registered with the High Court for purposes of execution. There is a debate as to whether by virtue of such registration, the judgment became an order of the High Court or remained a judgment of the Labour Court. It is not necessary to determine this debate as the court a quo was not dealing with the alteration or variation of the judgment in which case the “ownership” of the judgment would have been material.

This point was also not lost to the court a quo which observed that it was not being asked to correct or vary the judgment that it had rendered, nor was it supplementing its decision in any way. Thus, the correct factual position is that the respondent was not approaching the court for variation of its judgment, it approached the court a quo on a new cause of action, to convert a valid and complete judgment given five years before, into a different currency for the purposes of execution. The court a quo was clear that it was not re-hearing the matter but was simply converting the amount payable in Zimbabwean dollars to United States dollars.

It is imperative for the Labour Court, before it can deal with a matter, to be satisfied that the matter placed before it has been brought in terms of the provisions of the Labour Act. The court a quo did not, in casu, point to any provision in the Labour Act in terms of which it assumed jurisdiction to hear the matter.

It is common cause that the Labour Act does not give the court a quo the jurisdiction to consider applications for the conversion of one currency to another even in labour matters. As already stated earlier, the court a quo found as a basis for its decision to assume jurisdiction in the matter, the decision in Fleximail.

The judgment of the Labour Court does not, contrary to the allegation by the appellant, purport to invoke or base the court’s jurisdiction to deal with the matter that was placed before it on the provisions of s 92C. The following statement at pp 4 – 5 of the judgment records the court’s basis for its assumption of jurisdiction:

“… on the basis of the authority of the Fleximail decision, this Court has the necessary jurisdiction.

…

The Labour Court in hearing the applicant (sic) of this nature is not seeking to correct or alter the judgment it has pronounced. The court is also no (sic) supplementing its decision in any way. That decision is finalised. But the court has not fully and finally exercised its authority over the matter.

…

This is why the Supreme Court has held that it is the Labour Court that is still ceased (sic) with the matter after pronouncing an earlier decision. Its authority can be fully and finally exercised after deciding that in cases of this nature the amount due and owing in Zimbabwean dollars can be converted to United States dollars and paid as such and this the court can do (so) because of its equitable jurisdiction conferred to it by virtue of the provisions of section 2A of the Labour Act.

The Supreme Court has reiterated this same position over and over again in its decisions listed below:

Central Africa Batteries v John Mhungu SC 79/2011

Madhatter Mining Company v Marvellous Tapfuma SC 299/12

Central African Batteries v John Mhungu SC 339/12.”

(the underlining is mine.)

With respect, the court a quo misread the Fleximail judgment. It incorrectly read it as conferring general jurisdiction on the court to convert the currency of an extant judgment from one to another. A careful reading of the Fleximail judgment shows that it does not confer any jurisdiction on the Labour Court. The judgment recorded the agreed position of the parties and for the guidance of the Labour Court, posed four issues that it directed the Labour Court to determine. These were as follows:

“3. For the guidance of the Labour Court, the Labour Court is directed to determine the following issues –

What is the effect of the change in currency effected in February 2009 on debts occurring before the effective date?

Does the Labour Court have the power to order payment in the operational currency (the United States dollar) of debts incurred under the Zimbabwe dollar currency which, though not demonetised, is no longer in use?

Has the principle of currency nominalism any application in the circumstances of this case?

The method of calculating the quantum of the debt in current realisable currency if the conclusion of the above issues is in favour of payment in United States dollars.” (the underlining is added.)

In particular, the Supreme Court asked the Labour Court to determine whether it has the power to order payment in the operational currency of debts incurred under the Zimbabwean dollar currency. It did not say that the Labour Court had this power. More importantly, it directed the Labour Court to determine whether the principle of currency nominalism had any application in circumstances similar to the ones in casu. There was no conferment of jurisdiction as erroneously deduced by the court a quo. Such jurisdiction can only be conferred by the Labour Act or any other enactment.

The court a quo being a creature of statute ought to have identified the provision of the Act or other enactment in terms of which the application before it had been brought. It failed to do so and proceeded on the basis of the fact that certain matters had been referred to it by the Supreme Court for it to deal with them on the basis of its equity jurisdiction. I find persuasive the following submission made in the appellant’s heads of argument at paras 2.3 and 2.4:

“2.3   As regards the court of equity jurisdiction argument, it is submitted that the Labour Court only exercises its function as a court of equity as stipulated in the statute or upon being conferred such function by a superior court. Put differently, equity is substantive and not procedural. Thus for the court to exercise its jurisdiction, the matter must first of all be placed before it in terms of section 89 (1) of the Labour Act. Indeed the hearing of a matter on remittal is an incidence of the exercise of powers under section 89 (1) (e) of the Labour Act.

2.4      The existence of equity jurisdiction does not give the court a carte blanche to do whatever it wants to do. In addition, the equity jurisdiction is a substantive rather than an adjectival matter. At issue a quo were the adjectival considerations. The equity argument consequently had no place in the resolution of the matter. The court a quo erred in conflating the two.”

The court a quo also erroneously held that the conversion of a judgment from one currency to another is similar in nature to the quantification of damages awarded. It was of the view that what it had been called upon to do was similar to a court which has awarded damages proceeding to quantify such damages. It was on this basis that it held that it had not fully exercised its “authority” over the matter. The quantification of damages is a requirement to complete the cause of action in a claim for damages. Conversion of one currency to another is not.

The finding by the court a quo at p 4 of its judgment that it had not fully and finally exercised its authority over the matter does not seem to find favour with the authorities. In The Cold Chain (Private) Limited t/a Sea Harvest v Robson Makoni CCZ 8/2017 (cited by Ms Maune before us) MALABA DCJ, as he then was, stated at pp 2-3 of the judgment:

“… The respondent was left in possession of a judgment he could not enforce to get the value of the damages. He made an application to the High Court for an order converting the Zimbabwe dollar denomination of the damages to the equivalent United States dollars.

The High Court declined to hear the application on two jurisdictional grounds. Firstly. It held that it was functus officio as it had already decided the main matter and given a final and definitive judgment. The High Court also said that the matter was res judicata.

The respondent appealed to the Supreme Court which held that the matter relating to the conversion of currency in which the damages were expressed placed before the High Court for determination was a new question different from the main matter which related to assessment of the damages. The Supreme Court held that the application had not been meant to interfere with the substance of the award as the High Court had not been asked to revisit its judgment. The court had been asked to take judicial notice of the fact that the currency in which the damages had been denominated had become valueless and that foreign currency had officially been adopted in the country as the legal tender. The High Court had been asked to order the conversion of the moribund Zimbabwe currency to United States dollars.

The Supreme Court held that the High Court erred in the application of the principles of res judicata and functus officio to the facts of the case. The judgment of the High Court was set aside and the matter remitted to that court for hearing and determination of the application. It is in respect of the judgment of the Supreme Court that the applicant seeks leave to appeal to the Constitutional court.” (the underlining is added)

Suffice to say the application for leave to appeal to the Constitutional Court was dismissed with costs for failure to meet the requirements for leave to appeal to the Constitutional Court from a subordinate court. Notably though, the judgment of the Supreme Court in that matter stands.

Admittedly the Cold Chain matter involved an award of damages made by the High Court and not the Labour Court as in casu. However, the principle enunciated therein is in my view applicable in casu. The Supreme Court judgment referred to in CCZ 8/17 (supra) is Robson Makoni v The Cold Chain (Private) Limited t/a Sea Harvest SC55/2016. At pp 4-5 thereof UCHENA JA stated:

“The principle of res judicata is therefore not applicable in this case. It does not prevent a court from hearing a dispute over already granted awards. A dispute arising from an already granted award is not the same as a further claim arising from a cause of action the parties have already litigated upon.” (the underlining is mine)

The court a quo heard and determined a matter that was ventilated before it. It made an award in favour of the respondent. The respondent successfully caused the registration of the award for purposes of execution.

The application for conversion of the Zimbabwe dollar component was not meant for the court a quo to interfere with the substance of the award. It is a dispute arising from an already granted award and is not the same as a further claim arising from a cause of action that the parties have already litigated upon. For that reason the court a quo ought to have identified the provision that conferred jurisdiction on it to hear the application. It did not. Such jurisdiction is not conferred by the enabling statute. Case law does not and cannot confer jurisdiction on a court over and beyond the provisions of the Act. This is not to be confused by the remittals that this Court has from time to time made to the Labour Court to determine certain specified issues. The said remittals by the Supreme Court in other matters did not confer jurisdiction on the court in this matter.

It is thus my view that that the court a quo did not have jurisdiction to hear the matter that was placed before it.

For the above reasons I find that the appeal has merit and must succeed. Costs will follow the cause.

It is therefore ordered as follows:

The appeal is allowed with costs.

The judgment of the court a quo be and is hereby set aside and substituted with the following:

“(a) The court declines jurisdiction to entertain this application.

(b) The applicant shall bear the respondent’s costs.”

MAKARAU JA				I agree

GUVAVA JA					I agree

Atherstone & Cook, appellant’s legal practitioners

Gutu & Chikowero, respondent’s legal practitioners