ZESA Technical Employees Association v ZESA Holdings (Private) Limited

The applicant (a registered trade union) and respondent concluded a collective bargaining agreement which was not registered. The respondent initially paid salary and benefits to managerial employees for two months according to the agreement, but thereafter reduced the salary and benefits. The applicant challenged this before an Arbitrator who ruled in favour of the respondent. The Labour Court upheld the Arbitrator's decision that the collective bargaining agreement was invalid and not binding because it did not comply with the statutory provisions of the Labour Act. The applicant appealed to the Supreme Court but failed to file a valid notice of appeal, resulting in the matter being struck off the roll with costs on 31 July 2015. The applicant then sought to appeal out of time through this application for condonation and reinstatement filed on 2 November 2015. However, by the time of this application, the applicant had ceased to exist as a registered trade union, having been de-registered. This fact was not disclosed in the founding affidavit and only became apparent during the hearing.

• Whether a non-existing entity has the legal capacity to institute proceedings before the court
• Whether proceedings instituted by a de-registered trade union are a nullity
• What rights a trade union loses upon de-registration
• Whether a new trade union that allegedly assumed the rights and obligations of a de-registered trade union can claim those rights without an application for substitution of parties

The matter was struck off the roll with no order as to costs.

A de-registered trade union loses its status as a body corporate and consequently loses the capacity to sue or be sued under section 29(2) of the Labour Act. Proceedings instituted by or in the name of a non-existing entity are a nullity because there is no legal persona capable of bringing the claim. Where an entity ceases to exist during the course of litigation and another entity claims to have assumed its rights and obligations, that new entity cannot claim those rights in the proceedings without making a formal application for substitution of parties in terms of the relevant rules of court.

The court observed that although the Labour Act does not expressly provide for the effect of dissolution of a trade union, the effect can be inferred from section 29(2). The court noted that a de-registered trade union may continue to exist as a voluntary association under the right to freedom of association, but it loses the statutory rights accorded to registered trade unions. The court also made observations about the need for transparency and full disclosure in founding affidavits, noting that the applicant failed to disclose the material fact of its de-registration.

This case establishes important principles regarding the legal consequences of de-registration of trade unions in Zimbabwe and the procedural requirements for continuing litigation after a party ceases to exist. It confirms that de-registration of a trade union results in the loss of its corporate personality and capacity to sue or be sued. The case also reinforces the strict procedural requirement that where a party ceases to exist and another entity wishes to continue proceedings in its place, a formal application for substitution must be made. The judgment emphasizes the importance of candor in litigation, as the applicant's failure to disclose its de-registration in the founding affidavit was a material non-disclosure. The case serves as a precedent for similar situations involving defunct corporate entities or trade unions attempting to pursue litigation.