Wakilii

Stanbic Bank (Uganda) Limited v Nassanga (Civil Appeal 182 of 2021)

Court of Appeal · [2023] UGCA 342 · 2023 Appeal Allowed ✦ AI-generated summary ↓ Download
Jurisdiction
Uganda
Case Type
Appeal and cross-appeal from an award of the Industrial Court in a wrongful termination claim
Decision
Appeal allowed and cross-appeal dismissed; Industrial Court award set aside and the respondent's claim dismissed

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Cited — treatment unverified cited in 17 (treatment unverified) Derived from citing cases in the Wakilii corpus — not an assertion that this case is good law.

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Holding

The Court of Appeal allowed the bank's appeal and dismissed the cross-appeal. Termination under section 65(1)(a) of the Employment Act 2006 differs from dismissal: an employer may terminate with or without a reason, provided it gives the requisite notice or payment in lieu, and a fair hearing under section 66 is required only for dismissal on grounds of misconduct or poor performance. The bank lawfully terminated by paying three months' salary in lieu of notice, so no reason or hearing was needed. Article 4 of ILO Convention No. 158 was never domesticated and has no force in Uganda. As termination was lawful, no general, aggravated or exemplary damages were payable, and unpleaded claims raised only in a witness statement could not be granted.

Facts

The respondent was employed by the appellant bank from February 2001. Clause 18 of her contract allowed either party to terminate on one month's notice or payment in lieu. On 14 December 2012 the bank terminated her employment, paying her UGX 17,887,500 as three months' salary in lieu of notice plus terminal benefits. The respondent claimed the termination was unlawful because no reason was given and she was not accorded a fair hearing, and alleged she was terminated because she had sued the bank for breach of privacy after an email bearing her name and photograph was circulated to other banks during a loan-fraud investigation in which she was not found culpable. The Industrial Court found wrongful termination and awarded her UGX 65,000,000 general damages. The bank appealed; the respondent cross-appealed seeking declarations of illegality, severance and repatriation allowances, payment of outstanding salary/home loans, and increased general, aggravated and exemplary damages.

Issues

  1. Whether a Notice of Cross-Appeal filed under Rule 91 of the Judicature (Court of Appeal Rules) Directions can be struck out under Rule 86 for being argumentative or narrative.
  2. Whether termination of employment, as distinct from dismissal, requires the employer to give a reason to be lawful under the Employment Act 2006.
  3. Whether termination of employment, as distinct from dismissal, requires a fair hearing to be lawful.
  4. Whether the Industrial Court properly awarded the respondent general damages of UGX 65,000,000.
  5. Whether the respondent could be awarded severance allowance, repatriation allowance and a refund of loan deductions where these were raised only in her witness statement and not in the memorandum of claim.
  6. Whether the respondent was entitled to aggravated and exemplary damages.

Orders

  • Appeal allowed.
  • Cross-appeal dismissed.
  • The judgment and orders of the Industrial Court (lower court) are set aside.
  • The respondent's claim is dismissed.
  • Costs awarded to the appellant in the Court of Appeal and in the trial Court.

Key headnotes

Employment Law — Termination distinguished from Dismissal — Reason not required for lawful termination
An employer may terminate an employee's contract of service under section 65(1)(a) of the Employment Act 2006 with or without a reason, provided the requisite notice or payment in lieu of notice is given; only a dismissal on grounds of misconduct or poor performance requires a justifying reason.
Employment Law — Fair hearing — Confined to dismissal under section 66
A fair hearing under section 66 of the Employment Act 2006 is required only where an employer dismisses an employee on grounds of misconduct or poor performance; where employment is terminated on notice and no allegations are made against the employee, no hearing is required.
Employment Law — Payment in lieu of notice — Satisfies statutory notice
Payment of compensation in lieu of notice satisfies the notice requirement under section 65 of the Employment Act 2006, and it is immaterial that the payment was made after the termination as a corrective measure to comply with the Act.
International Law — Domestication of treaties — Dualist state
Article 4 of the ILO Termination of Employment Convention No. 158 of 1982, requiring a valid reason for termination, was not enacted into the Employment Act 2006; Uganda being a dualist state, an undomesticated treaty provision has no force of law and cannot be enforced by domestic courts.
Damages — Wrongful termination — No damages where termination lawful
Where a termination is lawful no damages are recoverable; damages in an employment action are confined to loss arising from failure to give proper notice, and no general, aggravated or exemplary damages are available for the manner of termination or injury to feelings (Addis v Gramophone Co Ltd).
Civil Procedure — Pleadings — Witness statement is not a pleading
Parties and the court are bound by the pleadings; a claim raised only in a witness statement and not in the memorandum of claim cannot be granted, because a witness statement is evidence-in-chief and not a pleading, and a party cannot introduce a new claim through it.
Civil Procedure — Cross-appeal — Rule 86 not applicable to Notice of Cross-Appeal under Rule 91
A Notice of Cross-Appeal under Rule 91 of the Judicature (Court of Appeal Rules) Directions cannot be struck out for being argumentative or narrative under Rule 86, which by its terms governs only a memorandum of appeal.

Legislation cited (25)

  • Employment Act 2006 s.2
  • Employment Act 2006 s.39(1)
  • Employment Act 2006 s.39(3)
  • Employment Act 2006 s.58(1)
  • Employment Act 2006 s.58(3)(d)
  • Employment Act 2006 s.58(5)
  • Employment Act 2006 s.65(1)(a)
  • Employment Act 2006 s.66
  • Employment Act 2006 s.68
  • Employment Act 2006 s.69
  • Employment Act 2006 s.71
  • Employment Act 2006 s.75(h)
  • Employment Act 2006 s.87
  • Employment Act 2006 s.89
  • Constitution of Uganda Article 28
  • Constitution of Uganda Article 42
  • Constitution of Uganda Article 45
  • Constitution of Uganda Article 287
  • Judicature (Court of Appeal Rules) Directions Rule 30(1)
  • Judicature (Court of Appeal Rules) Directions Rule 86(1)
  • Judicature (Court of Appeal Rules) Directions Rule 91
  • Labour Disputes (Arbitration and Settlement) Act 2006 s.22
  • Civil Procedure Act s.2(p)
  • Civil Procedure Rules Order 6 rules 6 and 7
  • ILO Termination of Employment Convention No. 158 of 1982 Article 4

Cases cited (29)

  • Barclays Bank of Uganda v Godfrey Mubiru (Supreme Court Civil Appeal No. 1 of 1998)
  • Stanbic Bank Ltd v Kiyemba Mutale (Supreme Court Civil Appeal No. 2 of 2010)
  • Hilda Musinguzi v Stanbic Bank Uganda Ltd (Supreme Court Civil Appeal No. 28 of 2012)
  • Hilda Musinguzi v Stanbic Bank (U) Ltd (Civil Appeal No. 5 of 2016)
  • Bank of Uganda v Joseph Kibuuka and 4 Others (Civil Appeal No. 281 of 2016)
  • Stanbic Bank Uganda Limited v Deogratius Asiimwe (Civil Appeal No. 18 of 2018)
  • Attorney General v Florence Baliraine (Civil Appeal No. 79 of 2003)
  • Mulindwa George William v Kisubika Joseph (Civil Appeal No. 12 of 2014)
  • Uganda Development Bank v Florence Mufumba (Civil Appeal No. 241 of 2015)
  • Interfreight Forwarders (U) Ltd v East African Development Bank (Civil Appeal No. 33 of 1992)
  • Addis v Gramophone Co Ltd [1909] AC 488
  • Rookes v Barnard [1964] AC 1129
  • Esso Standard (U) Ltd v Semu Amanu Opio (Supreme Court Civil Appeal No. 3 of 1993)
  • Fredrick Zaabwe v Orient Bank (Supreme Court Civil Appeal No. 4 of 2006)
  • Ahmed Ibrahim Bholm v Car and General Ltd (Civil Appeal No. 12 of 2002)
  • Macfoy v United Africa Co Ltd [1961] 3 All ER 1169
  • Mary Pamela Sozi v Public Procurement and Disposal of Public Assets Authority (HCCS No. 63 of 2012)
  • National Forest Authority v Sam Kiwanuka (Civil Appeal No. 5 of 2009)
  • Kifamunte Henry v Uganda (Supreme Court Criminal Appeal No. 10 of 1997)
  • Twinomujuni Moses v Rift Valley Railways (Civil Suit No. 212 of 2009)
  • Fang Min v Belex Tours and Travel Ltd (Supreme Court Civil Appeal No. 6 of 2013)
  • Adetoun Oladeji (NIG) Ltd Vs. Nigerian Breweries PLC, S.C. 91/2002
  • Uganda Association of Women Lawyers v Attorney General (Constitutional Petition No. 2 of 2003)
  • Caroline Turyatemba and Others v Attorney General (Constitutional Petition No. 15 of 2006)
  • Stroms Bruks Aktie Bolag v J&P Hutchison [1905] AC 515
  • Huljiah v Hall [1973] 2 NZLR 279
  • Obongo v Kisumu Council [1971] EA 91
  • Tumusiime and 5 Others v Mukwano Personal Care Products (Labour Dispute Reference No. 22 of 2014) [2019] UGIC 30
  • Mugisha M. Rogers v Equity Bank (U) Ltd (Miscellaneous Application No. 70 of 2019)
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.