Othieno Andrew v National Water & Sewerage Corporation (Civil Appeal No 67 of 2002)

Court of Appeal · [2005] UGCA 92 · 2005 Appeal Dismissed ✦ AI-generated summary ↓ Download

Jurisdiction

Uganda

Case Type

Civil appeal from High Court dismissal of a claim for salary arrears and allowance of a counter-claim for refund

Decision

Appeal dismissed; trial judge's dismissal of the claim and order for refund of inadvertently paid salaries upheld.

The full judgment

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Holding

The Court of Appeal dismissed the appeal. It held that a master may terminate a contract of service at any time and such contracts are not specifically enforceable. Where an employee is wrongfully dismissed, his remedy lies in damages, not in a declaration that the service continued. The appellant had not been reinstated but re-engaged afresh under a new contract effective June 1999, so the period between June 1994 and June 1999 during which his services were terminated was not reckonable for salary arrears or retirement benefits. The court upheld the order requiring the appellant to refund salaries the respondent had inadvertently included when computing his terminal benefits, as he could not enrich himself from the respondent's error.

Facts

The appellant was employed by the respondent as a senior storekeeper in 1991. In June 1994 he was laid off, and through his union he challenged the lay-off before the Industrial Court, which found the termination unlawful. In June 1999 the respondent re-engaged the appellant, but later asked him to retire; he accepted and retired in November 1999. The respondent paid his terminal benefits, but in computing them mistakenly included the period from June 1994 to June 1999 when he had been laid off, resulting in an over-payment of 5,393,115/=. The appellant sued in the High Court claiming salary arrears for the period he had been laid off. The respondent resisted and counter-claimed for the over-paid amount. The High Court dismissed the appellant's claim and allowed the respondent's counter-claim, ordering a refund. The appellant appealed.

Issues

Whether the period between June 1994 and June 1999, during which the appellant's employment had been terminated before re-engagement, was reckonable for the computation of retirement benefits and payment of salary arrears.
Whether the respondent's counter-claim for the refund of salaries inadvertently paid for that period was strictly proved.

Orders

Appeal dismissed.
Decision of the trial judge upheld.

Key headnotes

Employment & Labour — Termination of Contract of Service — Remedy for Wrongful Dismissal

A master may terminate a contract of service with his servant at any time and for any reason or for none at all; a contract of service is generally not specifically enforceable, and the remedy for wrongful termination lies in an action for damages rather than a declaration that the contract subsists.

Employment & Labour — Re-engagement versus Reinstatement — Continuity of Service

Where a dismissed employee is re-engaged rather than reinstated, the re-engagement constitutes a fresh contract and is not an extension of the old one; consequently the period during which his services were terminated is not reckonable for the payment of salary arrears or the computation of terminal benefits.

Contract Law — Restitution — Recovery of Money Paid by Mistake

An employee cannot enrich himself from his employer's error, and money inadvertently paid as salary for a period during which his services had been terminated must be refunded.

Cases cited (4)

Denmark Production Ltd vs Boscobel Productions Ltd (1968) 3 ALL ER 513
Francis Vs The Municipal Council of Kuala Lumpur (1962) 3 ALL ER 633
Vidyodayo University of Ceylon Vs Silva (1964) 3 ALL ER 865
Okori Otto Vs UEB (1981) HCB 53

Source: this page presents Wakilii’s issue analysis and metadata for a publicly reported Ugandan judgment. Any AI-generated summary is marked as such. Judgment text is sourced from the Uganda Legal Information Institute (ulii.org). Wakilii is not affiliated with ULII.