(COURT OF APPEAL)

ABUL ELA AND AHMED ABDEL KARIM CO. v. ALL EL BAYOUMI

AC-REV-273-1968

Principles

  Employment—Gratuity on termination of service—The Employers and Employed Persons Ordinance 1949, s. 24—Calculated from the date of the coming of the Ordinance into force

Employment—Disability due to old age—Frustrates contract of service

(i) An employed person who is in service before February 12, 1949, the date of the coming of the Employers and Employed Persons Ordinance into force, is entitled to gratuity under section 24 of the said Ordinance from the date the said Ordinance came into force and before.

(ii) Disability due to old age frustrates the contract of service.

Advocates: A. M. Safwat for the applicants

Judgment

Mustafa Abdel Gader for the respondent

Dafalla El Radi Siddig J. August 31, 1969 : —Respondent sued applicants under the Employers and Employed Persons Ordinance for the recovery of £S.270. After respondent was heard the applicants stated that there was no case to answer. The District Court non-suited respondent. The Honourable Province Judge passed judgment for respondent for £S. 124.

It is contended for applicants that respondent left their service of his own volition, and without completing i years. It is argued that he is therefore not entitled to anything.

It is stated in reply for respondent that respondent had been in the service of applicant for 49 years. Furthermore, that he left the. work owing to his illness and old age. And so he did not quit due to his own volition.

It is clear from the Honourable Province Judge’s judgment that he only speaks of the gratuity question. Nothing were dealt with there to show that the questions as to the notice and wages during illness is there. Therefore we take it that the appeal before us is only with regard to the former point since no cross appeal on the latter points is made. Hence, I will only comment on the latter aspect of the case as obiter.

Now, two legal questions arise. First, as from when is an employed person who is in the service before February 12, 1949, the date of the coming of the Employers and Employed Persons Ordinance into force, entitled to gratuity? Secondly, whether disability due to old age frustrates the contract?

As to the former point, it is my view that gratuity under the Ordinance should be calculable as from the date of the coming of the Ordinance into force and not before. The Employers and Employed Persons Ordinance, s. 24 reads:

“An employed person shall not be entitled to receive any gratuity payable on termination of his contract of service under the pro visions of this Ordinance until he has completed

See also the definition of continuous service in section 10 (2) of the Ordinance, which is unequivocally clear.

With regard to the second point it is my view that disability to continue in the service owing to old age frustrates the contract. It cannot be said that it is a voluntary act of leaving the service. There is no direct authority in the Ordinance, but the authority is in the Common Law. See Hashem, Arab Contract of Employment (1964), pp. 218—219. Therefore, it cannot be said that respondent is dismissed under the Employers and Employed Persons Ordinance, s. 10.

Since the applicant left the work in August 1962 and the period of continued service is calculable as from February 12, 1949, it is clear that the service of respondent is for less than i years for the intents of the Ordinance. Therefore, section 26 is out of the question.

It had been heretofore said that since respondent left owing to old age it cannot be said he was dismissed under the Employers and Employed Persons Ordinance, s. 10 (2). In the event Sections 24 and 25 of the Ordinance are applicable. It is incorrect to speak about section 26 which deals with the cases where the employed person resigns. See Hashem, supra, at p. 273. Further this section is indicative of a ratio of calculating the gratuity in case of resignation. It does not affect the liability of the employer to pay gratuity under section 25. All that the latter section demands is not less than 5 years of continuous service to render the worker entitled to gratuity. In the event he will be entitled to one half of one month’s basic pay plus cost-of-living allowance up to 12 years; and one month’s basic pay plus cost of living for each additional year, etc. Respondent stated in his testimony that his salary was pt.60 per day which equals £S.18 per month. The Ordinance came into force on February 12, 1949, while respondent left the service in August 1962 and therefore he had been in the service for 14 years and 2 months Therefore, for the first twelve years, he is entitled to 12 X £S.9 (half the wages) which equals £S.108 + £S.36 (for 2 years) + £S.9 (wages for six months). Therefore in the aggregate he is entitled to £S.117.

In so far as the other reliefs claimed by respondent in the District Court are concerned, since he did not make a cross appeal with respect to them we will not argue them.

Ergo, the decree of the learned Province Judge is varied and judgment is entered for £S.117 and I. pass no order as to costs.

B. M. A. Baldo 1. August 31, 1969 :—I agree. I may only add that it is a rule of law that a contract for personal services is discharged by supervening incapacity. A contract to perform services which can be rendered only by the promisor personally necessarily contemplates that his state of health, which at present is sufficiently good for the fulfillment of his obligations, will continue substantially unchanged; and if this ceases to be so owing to his health or illness, the court decrees that both parties shall be discharged from further liability—Boast v. Firth (1868) L.R. 4 C I—Cheshire and Fifoot, Law of Contract (6th ed., 1964), p.482.