Commercial Law Index

This was an action claiming monies allegedly siphoned from the plaintiff’s bank account with the participation and/or collusion of the defendant; and damages for the defendant’s breach of the fiduciary duty as branch manager. The defendant filed a counterclaim that his continued suspension and dismissal was unlawful. 

The issues for consideration were whether the defendant caused financial loss to the plaintiff; whether the suspension and/or dismissal was lawful; and the available remedies.

Regarding the first issue, the court held that the suit rested on the allegation that the defendant kept 26 cheques. The court held that it was not proved that the defendant kept the cheques beyond the three days alleged by the plaintiff; however the court found that the defendant knew the cheques were kept beyond the three days. As a result, the defendant was jointly liable with a Mr Patrick Kigongo.

On the second issue, the court held that the plaintiff was entitled to suspend the defendant as he was charged with a criminal offence. Management may dismiss an employee who was facing criminal prosecution if their continued employment would prejudice the interests of the bank. However, the defendant was suspended without pay contrary to regulation 30 of the terms and conditions of service; and the termination was without notice of disciplinary action, without a right of defence, and was thus unlawful.

The plaintiff was awarded general damages. The defendant was awarded his full salary from the date of suspension until the date of termination.
 

The matter involved a claim by the applicant against the defendant’s conduct of unlawfully blocking and deducting monies from his salary account.

First, was whether the court, as a commercial division, had jurisdiction over the matter. The court reasoned that as it dealt with crediting and debiting of the applicant’s account, the matter therefore lay in the ambit of a banker customer relationship. The court was therefore had jurisdiction as it was a commercial matter. 

Next, was whether the applicant’s account had been unlawfully deducted and consequently who was liable, considering that the defendant had assumed the obligations of Crane Bank, the applicant’s original employer. The court found there was evidence that the applicant’s account had been credited with less money than he was earning for some time.

On the issue of liability, the court reasoned that despite the contractual exemption of liability upon assumption of Crane’s obligations by the defendant, the Employment Act required the employment obligations to transfer to the defendant as a matter of law. The effect was that the defendant was liable for the unlawful deductions.

Finally, the court dealt with the question of damages. The court used its discretion to put the plaintiff in the position he would have been but for the wrong, as required by law. The court, using its discretion, also awarded interest to the applicant on the basis that applicant had been deprived from own monies. It however denied the claim for exemplary damages as it could not establish malice, outrage or impunity in the conduct of the defendant. 
 

This case concerned the appellant's entitlement to notice of meeting prior to removal as company director. The appellant claimed relief for a declaration that his purported dismissal was a repudiatory breach of his contract of employment and that he was denied the right to a notice meeting pursuant to sections 236, 262 and 266 of Companies and Allied Matters Act (CAMA).

The counsel for the respondent contended that against the background of the appellant's contention the trial court had no jurisdiction to entertain the complaint. Given the above claim of the appellant, he should have approached the Federal High Court for the resolution of his complaint of the breaches and not the trial court.

This court held that the dismissal of the appellant was not lawful because of lack of due process. However, the trial court below lacked jurisdiction and since the trial court lacked the jurisdiction to enter the matter, the lower court, equally, lacked the jurisdiction to deal with the appeal before it. Thus, the appeal was found to be unmeritorious and was struck out for want of jurisdiction.

This case developed common law to hold an employer liable where one of its employees is sexually harassed by a senior employee.

The court considered the employer’s liability in tort for sexual harassment of its junior employee by a senior employee. The court held that the first and second respondent were jointly and severally liable for the damages suffered by the plaintiff as a result of sexual assault perpetrated against her.

The court applied the rule that an employer is vicariously liable for the actions of its employee when an unlawful act is connected to the conduct authorised by the employer. The court held that the first respondent placed the second respondent in a senior position of trust and thus had the responsibility of ensuring that the second respondent was capable of that trust. This trust created the causal link between the second respondent and the wrongful act and that the employment relationship facilitated the sexual harassment.

The court also found the first respondent liable for imposing a two-week suspension as opposed to dismissing the second respondent for sexual harassment of a younger subordinate.

Accordingly, the court granted the application for damages in the sum of R4 million jointly and severally from the first and second defendant.

The court considered whether the respondent’s witness' statement on oath needed to be amended notwithstanding the amendment of the statement of defence. Further, whether the appellant was properly retired from the service of the second respondent.

The court held that the giving of a written statement on oath is a distinct process from the statement of defence which serves to support the statement of defence but is not part of it. Further, according to the public service rules the compulsory retirement age for all grades in the service shall be sixty years or thirty-five years of pensionable service whichever is earlier. A statement of policy cannot overrule public service rules, especially where such terms are not written in terms of the contract of employment.

The court found that when the respondents were given leave to amend their statement of defence, the amended statement of defence took effect from the date of the original statement of defence. Therefore, it was too late for the appellant to object to the effect that there was no written deposition to support the amended statement of defence. The court also found that the premature retirement was unlawful, null and void thus entitled to reinstatement.

The court accordingly upheld the appeal and awarded costs.
 

This was an appeal against the decision of the High Court to decline jurisdiction to determine an issue of wrongful termination and compensation thereof.

The court interpreted the provisions of the Labour Act to differentiate the jurisdiction of the Commission from that of the High Court. The court applied the provisions of art 140 of the Constitution to the effect that the High Court has jurisdiction to enforce every right created by statute unless it is ousted in the Constitution. It was held that the previous court had the power to make the relevant award on the strength of the applicable law, terms of employment and evidence adduced before it. The fact that its jurisdiction is excluded in respect of other reliefs does not entitle the court to decline jurisdiction altogether. The court may hear the whole case but decline to grant the reliefs it is not competent to grant when it delivers its final judgment in the matter. Accordingly, the application was granted, the order of the High Court was set aside and an order was made for the High Court to assume its jurisdiction and determine the matter.

This case considered whether employees who were claiming compensation for loss of employment were ‘permanent employees’ in terms of an employment contract. The case additionally concerns whether the Court of Appeal had misdirected itself with regards to the weight of evidence.

The plaintiffs contended that they were employed by the respondent as permanent employees in terms of an employment contract. The respondent subsequently went into liquidation and the plaintiffs claimed for loss of compensation.

The court held that for a plaintiff to be entitled to benefits as an ex-employee, they should spell out clearly the terms of their employment as contained in their contract of employment and then prove their entitlements under those terms. The plaintiffs assume the burden of persuasion and producing evidence, however, it was clear that they were unable to produce a written agreement which spells out their terms of employment.  The court found that any contract of employment for more than six months which was not in writing was unenforceable.

The plaintiffs had been employed for 10 and 12 years respectively, but failed to obtain letters of appointment. It became apparent that they were only employed for the duration that they were engaged on a particular voyage.

The court found that to be a permanent employee one would need to prove employment through the use of a contract of employment, which was in writing and could be used as evidence to illustrate the terms thereof. In this case, the plaintiffs were only employees when the respondents required their services. Furthermore, the court held that the Court of Appeal had not misdirected itself with regards to the weight of evidence as the plaintiff failed to properly prove their claim.

Appeal dismissed.