C. OF A.
(CIVl NO. 2/99
COURT OF APPEAL OF LESOTHO
matter between :
BANK FIRST RESPONDENT
SOPENG SECOND RESPONDENT
VAN DEN HEEVER, J.A.
VAN DEN HEEVER, J.A.
to the parties for the sake of convenience as "Mapesela",
"the Bank" and "the Regional Manager".
was at all relevant times the branch manager at the main branch of
the Bank in Maseru. The headquarters of the Bank are
Services adjacent to the main branch.
of Motion accompanied by a "certificate of urgency"
Mapesela applied for an order declaring both his "purported
suspension" by the Regional Manager and his "banning ...
from entering the Branch offices of [the Bank]" to be null
founding affidavit may be summarised as follows : Mr Denis Ryan, an
Irish consultant at the Bank, had told Mapesela that executive
management of the Bank had decided to transfer Foreign Exchange
Operations (scil. of the main branch, therefore within the
of Mapesela) to the Finance Manager at headquarters.
wrote a memorandum on 14 September 1998 to Ryan, which he annexed to
his affidavit as "A", asking to be told,
in writing, what
had motivated this "policy decision", so that he could
explain it to staff. The reply, "B",
dated 15 September
merely repeated the information Ryan had given him orally. He then
on 30 September. This criticizes Ryan : "I am surprised that to
date you have not responded to [Mapesela's
earlier memo]..... I am
still awaiting your explanation [in regard to points queried in that
memo]" and seems to suggest some
impropriety on Ryan's part:
"You appear to be very apprehensive and protective of the action
taken on the inefficiencies of Ms Lephoto former accountant
Foreign Exchange. Be that as it may, may I request you to postpone
your unilateral decision to transfer Foreign Exchange- to
Services, Finance Division, for the following reasons :
my memo dated 31.08.98 to the Managing Director I have explained
that Accounts at Foreign Exchange have wrong take-on balances
have this problem sorted out first. Project D is addressing
reconciliations right now.
are tellers cash irregularities that need to be sorted out involving
huge cash imbalances at Foreign Exchange - for example
2.1. Mrs Limakatso Ramoeli unceremoniously resigned without having
accounted for Public Funds as is procedural and in accordance
Banking norms and telling practice. Her unprocessed vouchers were
handed over to another teller to process. This teller has
that when he had run out of cash to accommodate the unprocessed debit
vouchers the current Regional Manager increased
the balance in the
system to enable him to finish processing Mrs Ramoeli's vouchers
though this was unprocedural the net result or imbalance of Mrs
Ramoeli net cash imbalance is Ml.098.762.44. This requires
thoroughly investigated and Mrs Ramoeli has to explain what happened
to Public Funds.
2.2 Mr B. Sebaka has a huge cash difference comprising of unprocessed
: a) Inter-teller vouchers
Mr Sebaka has not had the unprocedural assistance from the Regional
Manager to increase his cash balance in the system
processing his debit vouchers which are over M2,000,000.00 Maloti.
module at Foreign Exchange is not yet operating according to plan.
This requires to be addressed by IT.
clearly explains that Foreign Exchange cannot be reasonably and
justifiably transferred to Finance Manager before these
be resolved. Unless the intention is to do something sinister or to
cover irregularities that someone has to account
Exchange cannot be transferred to Central Services under Finance
Division tomorrow on 01.10.98 until all the above
problems have been
resolved in the Bank and Public interest.
I want to
put it on record and advise the Board that when you want to do
something unprocedural you appear to do it under Finance
Lichaba. For example when you unprocedurally transferred Mrs Khojane
(Teller) who to date has a cash imbalance in excess
you placed her under Finance Manager. This time you want to
unprocedurally transfer Foreign Exchange under the
same Manager. I
wonder whether this is done by design or by default."
this letter were sent to the Managing Director, to the Chairman of
the Board, to "Internal Audit", to "Operations
Manager", and to "Human Resources Manager."
letter is already unequivocal evidence that Foreign Exchange
Operations at the branch of the bank where Mapesela was in charge
could not have been properly controlled. It was in a chaotic
condition. He himself appears to be aggrieved that the
committed on previous occasions to make the books appear to have
balanced, have not been again forthcoming to do
this (to the tune of
over two million Maloti) in respect of monies dealt with by Mr
not reply in writing. Instead, Mapesela was called by Mr Dungate, the
Managing Director to a meeting on 1 October attended
also by Ryan and
the Regional Manager. He was given the choice between going on
unrecorded leave of absence or suspension. He says
"I refused to take an unrecorded leave of absence
notwithstanding that I was being blackmailed into taking it by some
of some misguided good intentions that society should not
be given the impression that I have taken leave as opposed to having
was clearly wrongly inserted.
that he was surprised when he received a letter from the Regional
Manager dated 2 October informing him that
"I have decided to suspend you from your normal duties pending
investigations pertaining to the matters raised in your memo"
annexure C. "The Bank will contact you after finalization of
these investigations but please note that you will remain paid
throughout this period. Also you will not be expected to enter the
Branch Offices during the suspension period".
to the opposing affidavits, Mr Dungate, the "General
Director" had instructed the Regional Manager in Mapesela's
presence towards the end of the second meeting
on 2 October to
prepare a letter of suspension. This was done then and there, signed
in the presence of both Dungate and Mapesela
by the Regional Manager,
and handed to Mapesela).
ground on which Mapesela challenged the validity of the suspension is
three-fold. He was not given a pre-suspension hearing.
Manager had no power to suspend him, only the Board of the Bank could
do so. The suspension is open-ended and thus
twelfth and last paragraph of his founding affidavit purports to deal
with his need to obtain relief from the court on an urgency
"I also note with concern that the letter of second respondent
demands of me not to enter the branches of the first respondent.
may inform this Court that I bank with the respondent. Thus, to
prohibit me from entering the first respondent's branches amounts
strangulating my family and myself for it means that I cannot even go
to any of the Branches of the respondent to withdraw money.
amounts to unwarranted seizure and interference with my property by
first respondent who has not even given me natural justice
relation thereto. This approach by respondent of continuing to
trample on my proprietary rights renders this matter very urgent
I submit that I cannot be afforded adequate relief in due cause in
quoted extensively from the founding papers because the only matter,
in my view, that may have called for an answer, was
paragraph 12. I
say "may have" because one would have expected some further
allegation: that he had drawn the Bank's
attention to the problem
created by his being banned from entering any premises of the Bank's,
and that management had remained
matter was, understandably, opposed. The first objection to the
application, is that it was not a matter of urgency. On this
Mapesela is shown to have been untruthful about the alleged prejudice
claimed in his paragraph 12. Ryan deposed that at the
meeting on 1
October, Mapesela was told to reflect overnight on the options
offered him, and come up with alternatives the following
day if he
wished. Nothing came of this. When he was told on 2 October that his
consequent suspension would have to be on the basis
that he was not
allowed to enter any of the offices of the bank's branches, he had
objected on the ground repeated in his affidavit.
It was explained to
"he would obviously be allowed to enter branches of the bank for
purposes of transacting banking business. It was explained
that he would only be excluded from those parts of the bank to which
the public do not have lawful access".
Regional Manager not only confirms Ryan's testimony, but says that
Mapesela on Monday 5 October 1998 to enquire about certain bank
matters, Mapesela again complained about the ban on his
bank. The Regional Manager again told him that he was perfectly
entitled to enter all public areas of all branches
of the bank to
transact banking business.
replying affidavit Mapesela does not even try to give a different
version of either the meeting of the 2nd of October or
conversation with the Regional Manager, still less deny that such
meeting was held or telephone call made. He merely
in the broadest
terms accuses Ryan of deliberately creating a dispute of fact by
"fabricating as much untruths as possible".
As regards the
Regional Manager's telephone call, Mapesela merely says :
"He had already denied me an opportunity to enter the Branch of
the Bank. He cannot now turn around and say now that I have
challenge to his act say, he has changed his decision".
no attempt to justify such an illogical contention.
further affidavit supporting the respondents', a teller in the employ
of the Bank at Maseru Main Branch tells the court that:
"On 19 and 23 October 1998 I was on duty and cashed the cheques,
annexures MM1 and MM2 hereto. To the best of my knowledge the
Appellant came to the branch personally but, in order to avoid
in the queue, gave them to another bank employee to hand to
cash cheque MM1 was for four thousand maloti.
Mapesela denies, not that he could draw as much money as he required
out of his bank account, but the detail of how he
managed to so,
which is quite irrelevant. He says he did not ever go to any branch
after his "purported" suspension,
"I went to the
offices of the Human Resources Manager and requested some assistance
therefrom every time I needed money".
That misses the point. He
alleges in his founding affidavit that the allegedly arbitrary
conduct of the Bank "amounts to strangulating
my family and
myself. His affidavit was signed and sworn to on the 23rd of October.
He must have withheld from his counsel the
information that he had
had no difficulty in getting access to his bank account, and cashing
a large cheque almost a week earlier,
otherwise it is inconceivable
that Mr Mosito would have certified that the matter was in his view
one of urgency relief.
This is a
matter that is not only relevant to the credibility of Mapesela, but
also to a point taken on behalf of the respondents
in the opposing
affidavits already. Had Mr Mosito seen to it that the founding
affidavit complied with the provisions of Rule
would have questioned his client to discover the detail required by
that sub-rule before he himself certified that he bona
the matter to be one for urgent relief, which he could not have
granted on such scant information as is contained
in Mapesela's par.
12. The issue of such a certificate is not intended to be a
remaining issues I do not propose to do more than give the gist of
the evidence put before court on behalf of the respondents.
amounts to this. For some time the Government of Lesotho has wanted
to privatise the Bank. It had however been running at a
loss for some
years. No one would be interested in acquiring it before it operated
profitably. The Government, as the major shareholder
in the Bank,
concluded a contract in December 1997 with an Irish specialist
consulting company in the banking industry, to try
and achieve this
executive management team was constituted whose mandate was to take
over control of the bank and try to achieve a measure
profitability. It replaced the old management team and was given wide
executive powers, including the power to hire and fire
do all things necessary to fulfil its mandate - all of this with
assistance from and under the supervision of the
about March or April 1998 a team mandated by the Bank's new executive
management began working in the Maseru Main Branch
with a view to
ensuring that the books balanced at the end of each day. They found
many problems within the Foreign Exchange Department.
The detail one
can describe as hair-raising (although the relevant deponent merely
used the word "unsatisfactory") but
it is irrelevant in the
light of Mapesela's annexure C. The team reported the problems
relating to foreign exchange, which fell
under the control and
management of Mapesela, to the executive management of the Bank.
After a number of meetings of executive
management it decided to
transfer foreign exchange to a division at Head Office staffed by
more experienced and competent people
better equipped to sort out the
problems and then manage foreign exchange transactions more
effectively. Ryan says he never received
His own "B" was merely confirmation of what he had told
Mapesela orally. Receipt of "C"
led to a full meeting of
the Bank's executive management. Both the content of "C"
and Mapesela's action in circulating
it were considered (in my view
not only understandably, but inevitably) to constitute
insubordination and a challenge to the authority
of the executive
management team, hence to be against the Bank's interests and
inconsistent with any loyalty on Mapesela's part
to his employer. He
was called to a meeting, as he had himself deposed, and in effect
given a hearing. Told that his conduct appeared
and the content of "C" defamatory, he was urged (being
himself a part of the management team) to work with
instead of challenging its authority. He remained defiant. Only then
was he given the alternative of suspension or paid
leave, and time
until the following day to think it over. He remained intransigent.
The ban on his entry to the restricted areas
of the bank was regarded
necessary lest he incite other employees to adopt his own attitude
and so undermine discipline and loyalty.
founding affidavit shows that Mapesela was still of the view that he
knew better than Head Office, and resented the executive
team's taking policy decisions.
replying affidavit is ever) stronger. He is "terribly
embarrassed" in his defence because Ryan did not spell out the
detail, why he alleged the matter is not one of urgency. In regard to
many other statements of fact he similarly tries to transfer
onus, which burdened him to the respondents. His denials are bald,
and respondents' deponents are "put to the proof of
say. He is argumentative, his language is intemperate and insulting
of his superiors in both tone and content. As an
example of many, one
phrase from his paragraph 9 (all of which merits
"All this hullabaloo made by respondent's deponents is aimed at
clouding the issues to the prejudice of justice".
And in para 16
the challenge to management is blatant:
"It is incorrect that the Management of the Bank is presently in
the hands of an Executive Management team comprising a number
expatriates. The true legal position is that the Management of the
First Respondent is in Law in the hands of the Board of Directors.
Any self-styled so called Executive Management Team is an illegal
creature to which the wishes of which this court cannot give
was unsuccessful in the High Court, hence the present appeal. The
only flaw in the judgment of the court a quo which requires
attention, is that it discharged a rule nisi which on the papers
before us does not appear to have been granted.
suffered no prejudice as the result of his suspension. Since his
salary continued he was in effect given a paid vacation.
suspension should be invalid because it was "open-ended" is
without merit. The only party prejudiced would be
the Bank in paying
a salary while waiving its right to Mapesela's services in return. In
view of the Bank's own financial problems
one can safely assume that
steps were soon taken to put an end to the suspension. On the papers
he cannot be
have shown that he was deprived of a hearing before he was suspended.
That leaves only the third ground of his objection
to having been
suspended, for consideration.
persisted before us that the suspension had been unlawful: only the
Board of the Bank had the power for that. He relied
on section 11 of
Order 8 of 1971, the statute by which the Bank was constituted. He
argued that, because sub-section (1) of this
provides that the Board
of the Bank (established by section 3) "may appoint a secretary
to the bank and such number of officers
and other employees as may
appear to it expedient for the proper and efficient conduct of the
business and functions of the bank"
the Board and the Board
alone (emphasis added) was "the proper repository of power
regarding the appointments of employees"
and could not delegate
this. He referred to section 34 of the Interpretation Act No.8 of
1977 which provides that where an Act
confers a power on a person to
make an appointment he shall also have power to suspend or revoke the
appointment - a matter, I
would have thought, of common sense,
probably expressed in the Act ex abundante cautela. From the
proposition that he who hires
may also fire, Mr Mosito asked the
Court to take either a logical leap and accept that only the Board
has such power; or a linguistic
leap by inserting the word "only"
in section 11(1) of the order, before the
"The Board may appoint" etc. To do so would make little
sense. The Board would have little time to take administrative
policy decisions, being kept busy with hiring, suspending,
investigating, firing, generally dealing with every teller,
cleaner necessary to keep it and its branches going, and
the Chief Executive Officer which The Board and the Board alone is
a duty to appoint would have little to do. Mr Mosito had not
referred us to section 10 of the Order nor annexed this to his heads
of argument, as he had section 11. Section 10 namely provides that
"The Board shall appoint a Manager of the bank, who shall be the
Chief Executive Officer of the bank, and shall, whether appointed
director or not be present at all meetings of the Board"
unnecessary to labour the point that the Board was given a discretion
by section 11, and there is nothing in the Order to
indicate that the
Chief Executive Officer it was obliged to appoint should not have the
customary powers of such an officer, including
the power to delegate.
In addition to the fact that the Chief Executive Officer himself
suspended Mapesela, the Board was as overly
careful as the
legislature was in the subsection of the Interpretation Act to which
It ratified - in fact unnecessarily - the steps already taken by
the appeal has as little merit as had the application had out of
which it arose.
made by the court a quo is altered to read : "The application is
dismissed with costs". So too is the appeal
costs, such costs to include the costs of two counsel.
JUDGE OF APPEAL
Maseru this 15th day of October, 1999
Appellant: Mr Mosito
Respondents : Mr Roberts
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