IN
THE HIGH COURT OF MALAWI

LILONGWE
DISTRICT REGISTRY

CIVIL
CAUSE NO. 919 OF 2000

BETWEEN:

E.K.
MITHI & OTHERS………………………………………….PLAINTIFF

AND

RESERVE
BANK OF MALAWI……………………….………..1^ST
DEFENDANT

ATTORNEY
GENERAL……………………………………………2^ND
DEFENDANT

CORAM: CHOMBO,
J

Chilenga,
Counsel for the Plaintiffs

Chioza,
Counsel for the Defendants

Kafotokoza,
Court Interpreter

Namagonya,
Court Reporter

JUDGMENT

Chombo, J

By
their statement of claim the plaintiffs seek remedies for wrongful
arrest and detention, malicious prosecution and defamation
for which
they claim general and aggravated damages. They also claim costs of
this action.

The
undisputed and brief historical background is that, save for the 2^nd
Plaintiff, the plaintiffs were employed by Reserve Bank of Malawi –
the 1^st
defendant, herein after called the Bank, in various positions. The
Bank alleged that its employees, in connivance with the 2^nd
plaintiff, a salesman in the employ of Southern Bottlers, were
responsible for fraudulent transactions at the bank resulting in

financial losses. They were all arrested and charged in the
Magistrates Court with theft. They were prosecuted and at the end
of
the day they were acquitted and set at liberty; thus the claims now.
The defendants completely deny the said claims and call
upon the
plaintiffs for strict proof of the claims thereof.

In
order to support their claims the plaintiffs gave evidence. It was
their testimony that PW1, 3 & 4 were all involved in
the
procurement of, among other things, drinks at the Bank and PW4 was a
salesman at Southern Bottlers who used to supply the Bank
with the
said drinks. PW1 stated that as procurement officer he would receive
requisitions from various departments. The said
requisitions were
signed by the particular departmental heads and forwarded to the
Procurement Department. The procurement departmental
head would then
sign for the requisitions before passing them down to PW1 to commence
the procurement process. All requisitions
signed by the departmental
head would then be down to the General Manager for his final approval
before Local Purchase Orders (LPOs)
were issued to different
suppliers. After the various stocks were purchased and before
delivery to the requisitioning departments
it was mandatory for an
auditor to verify the correctness of the stocks in terms of quality
and quantity in the presence of one
person from the requisitioning
department. The delivery note or invoice would then be signed by the
auditor as evidence that the
stocks have been delivered to the
appropriate department. PW1 would then raise a Goods Received Note
in triplicate showing what
goods had been bought and it was signed
again by the auditor, the receiving department and PW1. The invoice
or delivery note received
from the supplier with a duplicate copy of
the requisition and copy of the GRN were attached and sent to the
Accounts Department
for payment.

In
November 1997 he was on leave and he visited his village. When he
came back to his house he was informed that a Bank official
and a
police man had come looking for him so he reported to the Human
Resources Department where, after a short while, he was invited
to
the 6^th
floor in the Secretarial Pool. Some Bank officials had converged in
the room and they had a number of procurement documents. He
was
given the said documents and told to study them. After a while he
was asked questions relating to those documents. Finally
he was
informed that drinks worth about K200,000 connected to those
particular documents had not been accounted for. He explained
to the
congregation there what the procedure was and the fact that the
recipient of the relevant drinks had acknowledged receipt
by actually
pending their signature together with the auditor. It was found,
according to PW1, that there was no shortage as such
but that there
were different types of drinks in stock from those indicated on the
documents of purchase. As a result of these
differences he was taken
to Lingadzi Police in a Bank vehicle in the company of Mr Nyirenda,
Deputy Director, and a Police officer.
At Police he was told to
remove his shoes and he was locked up in a cell. The following day
he received a letter of suspension
from the Bank on account of
failing to account for drinks. He was in custody at Lingadzi Police
for seven days then he applied
for bail. He was released upon paying
K7,000 and producing two sureties.

Criminal
proceddings were instituted by the Bank but at the end of the day the
State Prosecutor offered no evidence and PW1 was
acquitted on 26^th
May 1998. Before the case was completed he received a letter from
the Bank terminating his services. It was PW1’s conviction
that
the Bank caused the said arrest and subsequent detention in custody
for which he now claims damages.

The
evidence of PW2 was that he used to work for Southern Bottlers as a
van salesman. Among his many customers was Bank. His
services were
terminated in 1998 when the Bank had him arrested as a suspect on
some fraudulent dealings together with some employees
of the Bank. It
was his testimony that as a salesman he used to sell drinks to the
Bank on issuance of an LPO or by verbal arrangement
with the Bank’s
officers in the procurement department. Sometime in November 1998, he
was delivered to the Bank premises by his
Manager - Mr Hawa. Mr Hawa
told him that there were some irregularities at the Bank and that PW2
was needed to give an account
on these. At the Bank he was told that
he had supplied drinks that had not been ordered. He gave an account
of all transactions
with corresponding LPOs found at the Bank. At
the end of that day he was released to go back to his place of work.
However, his
employer, on the bases of the report from the Bank
suspended him from work immediately.

He
was at home when one day a vehicle came to his house being driven by
the Bank’s driver. In the said car was a Police officer
and two
Bank officers. He was told to join the people and go to Police on
the issue of the drinks. Whilst in the vehicle the
Police officer
informed PW2 that he had been sent by the Bank to pick him up. He
was further told that if he knew anything concerning
the alleged
fraud concerning drinks at the Bank he should just come out in the
open and the matter would be closed. He assured
the enquirer that
all his deliveries of drinks had tarried with the LPOs from the Bank
and there was nothing else he had not disclosed.
He was taken to
Area 18 Police where statements were recorded from him. The
following day he was transferred to Maula Prison
where he spent the
next nine days. He was released on bail when the matter first
appeared in court. The case was called in court
on several occasions
but failed to proceed because witnesses from the Bank failed to
appear. Finally the Prosecutor offered no
evidence and he was
acquitted.

PW3
was Mr Luka Dzimbiri who testified that he used to be the Procurement
Officer for the Bank when a shortage on drinks was reported
by the
Bank. His boss, a Mr Nyirenda, invited him to answer some questions
in connection with the shortage on the drinks at a
meeting organized
by the Bank. The Chairman of the meeting, Mr Ian Bonongwe, explained
to PW3 that there was a shortfall on soft
drinks of K270,000 in the
cafeteria and asked him to explain the shortfall. He explained the
full process involved and he went
back to his office. He reported
for work the next day. Just after a few hours Mr Malitoni, a lawyer
employed by the Bank asked
PW3 to accompany him to Police. They
together went to Area 18 Police where Mr Malitoni left PW3 at the CID
office. Mr Malitoni
told the Police that:

“This
is Mr Dzimbiri the friend of Mr Phiri who is being kept here at
Police.”

It
was not until the next day that statements were recorded from him.
He was not told any reasons for his arrest by either Mr
Malitoni or
the Police. After statements were recorded he was moved to Maula
Prison and was released on bail by court after some
days. The case
failed to proceed because, after only one witness from the Bank gave
evidence, the Prosecutor offered no evidence
as witnesses from the
Bank failed to turn up on three occasions.

PW4,
Mr Jones Gondwe, gave evidence that he was one day informed that it
was suspected he was involved in the missing of some drinks
at the
cafeteria. He explained to court the system of procurement existing
at the Bank then. As one of the auditors he was assigned
to check
that the quality and quantity of goods purchased tallied with what
had been requisitioned; and that the requisitioning
department had
received the goods.

On
the day in question Mr Nkunika and Mr Nthani, both deceased now, took
him to Lingadzi Police in the Bank’s car. The reasons
for taking
him to Police were not disclosed. At Police he was told by the two
officers to remain behind. Whilst at Police other
officers from the
Bank also joined him. He spent two days at Lingadzi Police and seven
days at Maula Prison. Then he was released
on bail after the case
was taken to court. He and the other officers were acquitted after
Bank witnesses failed to turn up on
the scheduled dates of hearing.
PW4 concludes therefore that the prosecution was malicious and he
claims damages for that and
for false imprisonment.

It
was reported that Mr H. Phiri – the 5^th
plaintiff was unable to give evidence due to illness and the
plaintiff’s case was closed at this point.

It
was the evidence of defence that it was correct that all four
plaintiffs were connected to the shortage of drinks experienced
at
Bank. The plaintiffs, except 2^nd
plaintiff were working for the Bank. It was the evidence on record
from the three defence witnesses that there was system of procurement

at the Bank. The system has since been changed. All stores were
purchased upon receipt of a requisition by the head of any
department.
When the goods were purchased, following the system
started by the plaintiffs, there would be three officers receiving
the goods
and verifying the quantities and quality. At the time that
the plaintiffs, except 2^nd
plaintiff, were in procurement department a shortfall of 20 crates
was discovered. The three being directly involvement with the

procurement they were questioned about this shortage; together with
the salesman of the supplier, 2^nd
plaintiff. A meeting was held in the boardroom chaired by one of the
Bank’s Directors. The plaintiffs were asked to explain
about the
shortfall but they could not give satisfactory answers. In the
process of investigations it was discovered that some
bin cards were
tampered with, and specifically the bin card related to the 20 crates
of Cocopine was missing. A physical count
of the crates in the
cafeteria revealed a shortfall of 20 crates. The effect thereof was
that the Bank had paid for the said crates
but the same had not been
delivered or were stolen. Evidence was given that according to the
system in place then it was impossible
to commit the said offence
unless all persons involved had connived so to do. It was on this
base that the plaintiffs were considered
to be suspects. When the
plaintiffs failed to properly account for the 20 crates of drinks the
matter was reported to Police and
the five were arrested by Police,
kept in custody for some days, released on bail. The four were
prosecuted by the State but they
were discharged on an application
made by the Prosecutor of no case to answer. The witness denied that
the arrest was effected
by the Bank nor was the Bank responsible for
any defamation of character that the plaintiffs may have suffered. It
was conceded
that the Bank provided transport for Police to take the
suspects to Police station but this was at the request of the Police
who
had transport problems. The plaintiffs were told to report to
Police to answer questions and whilst there Police effected arrests.

It was further the evidence of defence that it was a surprise at the
Bank when the court had discharged the plaintiffs because
the
prosecution had elected to offer no evidence. Officers from the bank
had been willing and were ready to testify and the prosecutor
had
never indicated that he had problems soliciting witnesses. The Bank
however did not appeal against the decision nor send any
expression
of dissatisfaction about the conclusion of the case.

These
are the brief facts of the case as presented by the two parties. The
two main issues before court are:

1. 
   whether the Bank caused
   the arrest and subsequent detention.

   
   

2. 
   whether the Bank,
   without proper cause and justification prosecuted the plaintiffs.

   
   

3. 
   whether because of the
   arrest, detention and malicious prosecution the plaintiffs claim
   that they have suffered damages and must
   be compensated accordingly.

   
   

False
Imprisonment

The
law has been clearly laid down as to what constitutes false
imprisonment. In Hauya
v Cold Storage Co Ltd,
Civil Cause No. 274 of 1987, unreported, quoted with approval in
James
Saulosi and Goodwill Raketi v Bata Shoe Company (Mw) Limited,
civil cause numbers 568 and 569 of 1987, Unyolo J, as he then was
stated that:

“The
crucial issue in false imprisonment is to decide whether this
defendant’s servants merely stated the facts to the Police or

whether they made charges against the plaintiff…….……….”

The
test is this:

“If the defendant’s
servants made a charge on which it became the duty of the Police to
act then the defendant will be liable but
they are not liable if they
merely gave information and the Police acted according to their own
judgment.”

I
must therefore apply this test to the circumstances that led to the
arrest and detention of the plaintiffs. Evidence before court
is to
the effect that some officers at the Bank had been involved in some
malpractices and investigations revealed that other Bank
officers
were also involved in the malpractices but the former declined to
name them. The Bank, after further investigations found
a shortage
on drinks which had been procured by the plaintiffs of K270,000.

A
meeting was convened in the boardroom and a Mr Ian Bonongwe chaired
it. The plaintiffs were each asked about the matter and
given an
opportunity to explain how the drinks had missed from the cafeteria.
The explanations were not satisfactory and help
of the Police was
solicitated to resolve the matter. At the time the plaintiffs were
asked about the matter there was no police
officer in the boardroom.
A copy of the minutes taken then, showing members present, was
tendered as defence evidence. The plaintiffs
all denied knowledge of
the malpractice and the matter was reported to Police for further
investigations. DW3, who is legal advisor
at the Bank, reported the
matter to the head of the security department who then reported the
matter to Police. The plaintiffs
state in their evidence that the
Bank provided the transport to take them to Police. At this time, it
has been stated by defence,
Police had an acute shortage of transport
and they asked the Bank to provide transport. It was for that reason
alone that the
Bank provided transport. The aim of going to Police,
as demonstrated by defence witnesses, was to enable Police carry on
investigations
after the plaintiffs had denied being involved in the
drink scum. When the Bank’s officers handed over the plaintiffs to
Police
there was no charge laid against them. It was the evidence of
PW1 that he was told that he “would be taken to Police” at the

close of the meeting in the boardroom. He was taken to Police in a
Bank car accompanied by Mr Nyirenda, the Chief Security Officer,

Deputy Director and a Policeman. At Police he was questioned about
the matter. He was suspended from work for failing to account
for the
drinks and eventually was dismissed.

PW2
stated that he was taken to the Bank in a SOBO vehicle after his boss
told him that he had to explain certain matters in connection
with
drinks he had supplied. Then he was taken to Area 18 Police where he
was asked questions. He was told that the Bank had suspected
some
foul play but the Bank officers who accompanied him to Police did not
say anything to him. PW3 stated that after the discussions
in the
boardroom he worked up to 5 p.m. But the next day DW3 asked PW3 to
follow him to Police in a Bank vehicle. At Police DW3
told the
Police that PW3 was a colleague of Mr Phiri who was being kept at
Police and then DW3 left. Equally, PW4 was taken to
Police without
any charge being made against him by the officers from the Bank.
There is no evidence on record that any officer
from the Bank laid a
charge against the plaintiffs at any time. The plaintiffs were all
of course informed that they were suspected
to have had a hand in the
fraudulent dealings involving drinks worth about K270,000 and nothing
more. It would be presumptuous
to conclude that the officers from
the Bank caused the arrest of the plaintiffs. PW2 stated in evidence
that the Police man who
arrested him had actually told him that the
Bank had ordered the arrest. But the Police officer was not called
to testify on this
issue. The submission of defence was that the
purpose of taking the plaintiffs to Police was to cause Police to
investigate the
matter further. I am afraid I must find that there is
no evidence to the effect that the arrest of the plaintiffs was at
the instance
of the Bank.

Malicious
Prosecution

It
was laid down in Mohammed
Amin v Bannerjee [1947]
AC 322 that:

“ A
claimant who has been subjected to legal proceedings improperly
instituted against him will naturally be aggrieved by the institution

of those proceedings; be they criminal or civil proceedings.”

The
plaintiffs were therefore entitled to sue for damages for malicious
prosecution if they felt that the said proceedings were
improperly
instituted. Clerk and Lindsell on Torts define the ingredients of
malicious prosecution as follows:

“Essentials
of the tort of malicious prosecution: In action of malicious
prosecution the claimant must show first that he was prosecuted
by
the defendant, that is to say, that the law was set in motion against
him on a criminal charge. Secondly, that the prosecution
was
determined in his favour; thirdly, that it was without reasonable and
probable cause; fourthly, that it was malicious. The
onus of proving
every one of these is on the claimant.”

There
is no doubt that the State, the second defendant, instituted criminal
proceedings against the plaintiffs and that the determination
of that
case was in the plaintiff’s favour. A record of the criminal
proceedings from the lower court acquitting the plaintiffs
was
submitted as evidence in this respect. The plaintiffs submit that
when the Bank realized that there was not substantial evidence

against the plaintiffs they opted to offer no evidence and
subsequently the plaintiffs were acquitted. The Bank submitted that

there was a problem with the prosecution of the case because at no
point was it communicated to the legal department of the Bank
that
there was a problem securing witnesses. The Bank felt that the
acquittal was not justifiable but took no action to challenge
the
said acquittals. PW3 testified that when the sole witness of the Bank
gave evidence there were some disagreements between the
prosecutor
and the witness right in court. The record actually shows that at one
point, after the only witness gave evidence, the
case was withdrawn.
Then finally the plaintiffs were acquitted on an application by the
prosecutor. According to the record prosecution
made telephonic
enquiries with one Mrs Gundani who could not give evidence because
she had gone out of the country for studies.
One other witness had
just died at one of the hospitals and a Mr Zinkambani, the Catering
manager said he was not sure of the
matter so declined to give
evidence. The said Mr Zinkambani was not called to give evidence on
what is contained in exhibit P1.
Instead it was DW3 who stated that
his department was never contacted by prosecution on this matter. It
is not enough for DW3
to merely state that he was not aware of the
circumstances of the case when specific names are mentioned as to
what occurred.

The
point to be considered however is: were the proceedings instituted
without reasonable and probable cause? In Hernimas
v Smith
[1938] AC 305 the House of Lords approved the definition of
reasonable and probable cause of Hawkins, J in Hicks
v Faulkner

“An
honest belief in the guilt of the accused based upon a full
conviction, founded upon reasonable grounds, of the existence of
a
state of circumstances which, assuming them to be true, would
reasonably
lead any ordinary prudent and cautions man, placed in the position of
the accuser, to the conclusion that the person
charged was probably
guilty of
the
crime imputed.”
[Underlining
supplied for emphasis].

On
the facts of the case before me would it be reasonable to conclude
that the Bank had justification that an offence for which
criminal
proceedings should be instituted had been committed? My response is
in the affirmative. When the plaintiffs were given
an opportunity to
explain their side of the story in the boardroom their answers did
indicate that there was more to the matter
than could meet the eye –
they could not explain satisfactorily what happened to some documents
or to part of the drinks complained
of. According to ex D1, Minutes
of the meeting held in the boardroom with the plaintiffs, it was
blatantly evident that the plaintiffs
could not give a reasonable
account of the discrepancies. Reasons given for the discrepancies
ranged from forgetting to enter
purchases on Bin cards, forgetting to
include the purchases on the GRNs and not knowing what had finally
happened to the goods,
or who the end user was due to lack of proper
record keeping. The Bank believed, with reasonable cause, that the
plaintiffs were
responsible for the loss of drinks worth K270,000.00
and had the matter reported to Police.

Defamation

The
final claim for damages is for defamation. It was the submission of
the plaintiffs that as a result of the Bank’s action
they have been
defamed and suffered damage for which they must be compensated. On
defamation, Mtambo, A G J stated in A.B.
Nyirenda v Import and Export Company of Malawi (1984) Limited,
civil cause no. 23 of 1989 (unreported) that:

“The
law in cases of false imprisonment is very well settled. The
defendant will be reliable if I find that it laid a charge against
the plaintiff, on which it became the duty of the police
to arrest
him. It will not be liable if I find that all it did was to give
information to the
police
about a loss,
in this case of money, at its premises/offices.” (Underlining
supplied for emphasis)

I
did find that the defendant had merely laid information to police
about the suspicions of theft and asked the police to investigate
the
matter further. The claim must therefore fail as well. Having found
that the plaintiffs have not succeeded in all their claims,
I order
that each party bears its own costs.

MADE
in
Court this 28^th
July, 2006.

E.J.
Chombo

JUDGE