National Foods Limited v Godfrey Ngwaru and Others

On 3 February 2011, the respondents obtained an arbitral award for US$33,104.23 against the applicant. On 25 March 2011, the award was registered as an order of the High Court under case number HC1962/11 for enforcement purposes, and a writ of execution was issued the same day. On 28 April 2011, the same arbitrator rescinded the default arbitral award upon application by the applicant, directing that another arbitrator should hear the matter on its merits. Meanwhile, the Deputy Sheriff had already attached the applicant's property on 27 April 2011. The applicant made an urgent application to stay execution (HC 4410/11), which was dismissed for lack of urgency by Mtshiya J on 17 May 2011. The applicant appealed to the Supreme Court, which granted an interim interdict on 20 June 2011 stopping removal of attached property. However, the appeal lapsed for want of prosecution on 30 January 2015. The respondents then issued another writ on 19 February 2015. The applicant's subsequent urgent application for stay of execution was struck off by Makoni J for lack of urgency. To save its property from execution, the applicant paid the full amount to the respondents' counsel on 22 April 2015. The applicant then brought this application seeking registration of the rescission order, setting aside of the High Court judgment registering the original award, and restitution of the money paid.

• Whether an arbitrator has jurisdiction to rescind an arbitral award granted in default after it has been registered as a High Court judgment
• Whether the High Court judgment registering an arbitral award that was subsequently rescinded should be set aside
• Whether payment made pursuant to execution based on a rescinded arbitral award constitutes unjust enrichment entitling the payer to restitution
• The proper interpretation of sections 92B, 92C, and 98(9) of the Labour Act regarding the powers of arbitrators and the Labour Court to rescind their own orders after registration

1. The High Court order in case number HC1962/11 registering the arbitral award of 23 February 2011 issued in favour of the respondents is set aside. 2. The respondents, jointly and severally, the one paying the others to be absolved, are ordered to pay back to the applicant the sum of US$33,104.23, together with interest at the prescribed rate, within 7 days of the order. 3. The respondents are ordered to pay costs of suit on the ordinary scale to the applicant.

An arbitrator has jurisdiction under section 98(9) read with section 92C of the Labour Act to rescind or vary arbitral awards granted in default, even after those awards have been registered as judgments of the High Court. Section 92B(5) expressly contemplates rescission or variation of registered orders. The arbitrator's rescission does not directly rescind the High Court judgment but removes the foundation upon which it stands, entitling the party to apply to the High Court to set aside the judgment that registered the now-rescinded award. A High Court judgment registering an arbitral award that has been rescinded by the arbitrator has no foundation and should be set aside. Payment made pursuant to execution based on a rescinded arbitral award constitutes unjust enrichment, as the recipient is enriched without legal justification, and the payer is entitled to restitution of the amount paid plus interest.

The court observed that an absurd situation is created where the High Court registers an order which becomes its own, but if either party wishes it rescinded, the High Court cannot consider the merits as it has no jurisdiction over labour issues. The parties must utilize Labour Act structures to deal with the dispute, then approach the High Court to set aside the judgment that came by way of registration. The court noted that registration is solely for enforcement purposes and the High Court does not concern itself with the validity or merits of awards when registering them. The court rejected the applicant's request for costs on a higher scale de bonis propriis against the respondents' counsel, finding that counsel genuinely believed (albeit incorrectly) that the arbitrator lacked jurisdiction to rescind after registration, and was relying on supportive case authority. The proper alternative when an award is rescinded is for the judgment to 'die a natural death' by not being executed, though application to court may be necessary where a party insists on execution despite knowledge of the rescission.

This case is significant in Zimbabwean labour and arbitration law for clarifying that arbitrators retain jurisdiction to rescind their own awards even after those awards have been registered as High Court judgments for enforcement purposes. It resolves a conflict in the case law regarding whether arbitrators become functus officio after issuing awards. The judgment provides important guidance on the relationship between arbitral awards, their registration in the High Court, and the ongoing supervisory jurisdiction of arbitrators over their own decisions. It also confirms that execution pursuant to a judgment based on a rescinded arbitral award constitutes unjust enrichment, entitling the paying party to restitution. The case illustrates the proper procedure when an arbitral award is rescinded post-registration: the High Court judgment should be set aside through application rather than the parties simply ignoring it or the arbitrator purporting to rescind the court order itself.