Monterey Estate (Private) Limited v Kenny Broxham SC 49 – 16

“The quantification done by the arbitrator and upheld by the Labour Court in this matter is legally unsustainable. As the respondent did not prove that he was entitled to more than what the appellant had paid him, the Labour Court ought to have granted absolution from the instance.”

Introduction

The quantification of damages in lieu of reinstatement is a frequent source of labour law litigation. There is always the temptation to “pluck the figures from the air” an approach that the courts have frequently discouraged. Quantification of damages in lieu of reinstatement is not an easy task. Those who preside over such disputes must as much as possible fully utilise the evidence presented by the parties. Failure to consider such evidence results in a problematic outcome.

The Facts

This case was an appeal against the quantum of damages in lieu of reinstatement that was awarded to the Respondent, Kenny Broxham by an arbitrator. The Labour Court had agreed with the quantum.  Noteworthy, on 30 November 2009, the appellant company had given a month’s notice of termination of the employee’s contract, effective from 1 December 2009 to 31 December 2009. The respondent employee accepted alternative employment with effect from May 2010.

The Law

First, it was the Supreme Courts’ observation that the respondent was out of employment for four months. The damages awarded by the arbitrator and upheld by the Labour Court were for 9 months. There was no evidence supporting the 9 months. There was therefore no legal basis for the award because the amount granted in the arbitral award had no basis or explanation.

The Supreme Court utilised the law in Zupco v Daison wherein it was stated that:

“… in its judgment the Tribunal did not say why it chose the period of forty-eight months as opposed to any other period. As stated in Nyaguse v Mkwasine Estates (Pvt) Ltd 2000 (1) ZLR 571 (S) at 575D, ‘if the tribunal is forced to make an estimate, it must use the information to hand, and not simply pluck a figure from nowhere. In the circumstances, I am satisfied that the Tribunal’s decision can be categorised as wholly unreasonable. …”

Duly Holdings Limited v Clever Spanera 2005 (1) ZLR 407 (S); SC 140/04 was also utilised wherein the court remarked:

“He (the employee) will be compensated only for the period between his wrongful dismissal and the date when he could reasonably have been expected to find alternative employment.”

In essence, the Supreme Courts’ argument is straightforward, any process of quantifying damages must be supported by evidence. Failure to consider the evidence by the party’s results in an unreasonable award which is liable to be set aside by an appellate court. Even where a court is compelled to make an estimate, this estimate must be supported by the information presented by the parties.

Conclusion

The court allowed the appeal.

Own Comment

Repeatedly the Supreme Court has urged the lower courts to substantiate the quantum of damages with the evidence presented by the parties.[1] This is a universal rule when it comes to the quantification of damages in lieu of reinstatement. Plucking figures from the air results in an arbitrary decision which is not supported by the authorities on this subject.


[1]              See also Redstar Wholesalers v Edmore Mabika SC 52/05 wherein the court said: “The Labour Court’s approach was wrong and its consequent ruling grossly unreasonable. The Court is not entitled to pluck a figure out of a hat because it is of the view that this figure „meets the justice of the case‟. Instead, the court is required to hear evidence as to how long it would reasonably take a person in the position of the dismissed employee to find alternative employment. The fact that the parties have led insufficient evidence to enable the court to arrive at an informed conclusion does not absolve the court from its duty to utilise its powers in terms of s 89 (2) of the Labour Act by calling evidence in order to resolve the issue.”

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