Alon Hershkovitz v Pamela Bwalya Mutale and Anor (2014/HPC/0444) [2021] ZMHC 126 (21 May 2021)

IN THE HIGH COURT FOR ZAMBIA 2014/HPC/0444 AT THE COMMERCIAL REGISTRY HOLDEN AT LUSAKA (Civil Jurisdiction) BETWEEN ALON HERSHKOVITZ PLAINTIFF AND PAMELA BWAL YA MUTALE I ST DEFENDANT HOME DECO CENTRE LIMITED 2ND DEFENDANT CORAM: Hon Mrs. Justice Irene Zeko Mbewe For the Plaintiff: Ms Kapapula of Messrs SLM Legal Practitioners For the JS1 Defendant: Ms. M Kaoma of Messrs KMG Chisanga Advocates RULING Cases referred to: 1. Southern Cross Motors Limited v None Systems Technology Limited [2012] ZR Vol 2. Zambia Export and Import Bank v Mkuyu Farms Limited [1993-1994] ZR 56 Legislation referred to: 1. High Court Rules, Cap 27 of the laws of Zambia Rl I Page This is the pt Defendant's application pursuant to Order 36 Rule 9 High Court Rules, Cap 27 of the laws of Zambia asking this Court to allow her settle the Judgment debt in instalment. The application is supported by an affidavit sworn by the 1st Defendant. The facts as deposed are that Judgment was entered in favour of the Plaintiff in the sum ofUSDlll,513.00 andZMWIS,000.00. A payment of ZMWI 5,000.00 was made towards settlement of the Judgment debt leaving a balance ofUSDl 11,513.00. The I st Defendant has no capacity to liquidate the Judgment sum in one lump sum as she is not in formal employment and co-runs her current business with other family members namely her brother and mother. According to the I st Defendant, the COVID 19 pandemic has affected the income generation of the business. For the past 5 years, she is liquidating a loan with Madison Finance Limited to be completed by the end of August 2021 (Exhibit "PBMI "). Her business income varies from K60,000.00 to K45,000.00 monthly and draws K20,000.00 out of which her expenses range from K7000.00 to Kl 0,000.00 on food, water, electricity bills, fuel, school expenses and domestic workers (Exhibit "PBM2"). According to the I st Defendant, she has no capacity to liquidate the Judgment sum in one instalment and proposes to pay monthly instalments R2 I Page ofKl0,000.00 from 30th April 2021, and should the business improve, she can increase the monthly instalment. The Plaintiff opposed the application by way of affidavit dated 7th April 2021 and states that payment of ZMW15,000.00 was made by the pt Defendant around July 2018 and no further payments were made towards liquidating the Judgment debt (Exhibit "ALI"). According to the Plaintiff, the 1st Defendant's total indebtedness stands at USD135,861.65 exclusive of costs which are yet to be taxed in default of agreement. Further, the interest outstanding on the debt has been computed and stands at USD37,952.65 as at 15th January 2021 (Exhibit "AL2"). It is stated that no efforts have been made by the 1st Defendant to settle the Judgment debt even before the onset ofCOVID19. In respect to the exhibited Consent Judgment for the liquidation of K284,986.50, the Plaintiff states this was entered in November 2020 well after the present Judgment. It is stated the Plaintiff will suffer great prejudice should the 1st Defendant be allowed to pay the balance 1n instalments exceeding 3 months. In the affidavit in rejoinder filed on 15 th April 2021 , it is stated that the 1st Defendant did not disregard the Court Judgment but was advised she had prospects of success on appeal to the Supreme Court. Further, after dismissal of the appeal, the 1st Defendant's Advocates wrote to the Plaintiff's Advocates seeking clarification and proposals to start making R3 I Page repayments thus showing her willingness to engage and make payments (Exhibit "PBMl "). In respect to the Consent Judgment, the loan was disbursed in 2015 and the company became a creditor of the finance company from date of disbursement until final payment. According to the 1st Defendant, she is not possessed of any properties which can be disposed of save for personal clothing and other personal effects and a motor vehicle, therefore she is not in a position to settle the Judgment debt in 3 months. When the application came up on 7th April 2021, the Defendant's Advocates sought for leave to file its affidavit in reply as the opposing affidavit was served late. The Court ordered the 1st Defendant to file her affidavit within 7 days of the Order and the parties agreed to dispense with a formal hearing and for the Court to proceed to render its Ruling thereafter. I have considered the application, the response and skeleton arguments including list of authorities of the parties herein. The issue is whether to allow the 1st Defendant to settle the Judgment debt in instalments. Judgment in favour of the Plaintiff was entered by this Court on 4th June 2018 in the sum of US$1 l l ,513.00 and ZMW125,000.00 loan capital investment. Following the 1st Defendant's appeal, the Court of Appeal in its Judgment of 30th April 2019 upheld the decision of this Court save for R4 I Page reducing the loan capital investment from ZMWI 25,000.00 to ZMWl 5,000.00. The 1st Defendant only made a payment of ZMWl 5,000.00 towards the settlement of the Judgment sum as evidenced by a letter dated 8th July 2019 (Exhibit "PBM2"). There is no further evidence of any other payments to the Plaintiff as adjudged by the Court of Appeal. On 3rd March 2021 , the 1st Defendant was sent to prison for three (3) days for unwillingness to settle the Judgment debt pursuant to section 4 of the Debtors Act, Cap 77 of the laws of Zambia. On 22nd March 2021, the p t Defendant made the present application to settle the Judgment debt in instalments. The Defendant's application is made pursuant to Order 36 Rule 9 High Court Rules, Cap 27 of the laws of Zambia which states as follows: "Where any judgment or Order directs the pay ment of money, the Court or Judge may, for any sufficient reason, order that the amount shall be paid by instalments, with or without interest. " The Court has the discretion to allow a party settle a Judgment debt in instalments and this must be exercised judicially and only in circumstances that justify the exercise of such discretion. It goes without saying that every exercise of a discretionary power must aim at the attainment of substantial justice. RS I Page The Court has a duty to ensure that the successful party reaps the benefit of its successful litigation against a failure or inability of the Judgment debtor to settle the debt in one lump sum. In Zambia Export and Import Bank v Mkuyu Farms Limited [1993-1994} ZR 56 OJ, the Supreme Court held: "It is quite clear from Order 36 Rule 9 that a Court may order that a Judgment debtor be satisfied by instalments upon sufficient cause being shown by the Judgment debtor. " It is my understanding that sufficient cause should be shown to enable the Court exercises its discretion to allow a Judgment debtor settle the Judgment debt in instalment. The Judgment debtor is under an obligation to make a full and honest disclosure of its assets and liabilities. The onus is on the 1st Defendant to show that she will pay a fair proportion of the debt. The Supreme Court in the case of Southern Cross Motors Limited v None Systems Technology Limited [2012} ZR Vol r2J, held that: "the kind of evidence to be adduced in order for the Court to ascertain whether there is sufficient case of special circumstances includes a look at the applicant 's income, nature and value of property owned, details of the applicant 's indebtedness to other persons apart from the Judgment creditor. " I have perused the p t Defendant's bank statement and the inflows and outflows. The 1st Defendant states she does not owe any properties. She R6 I Page is a director in a company called PAMZOS Spot Limited co-owned with her mother and brother. The 1st Defendant has merely disclosed that she makes between ZMW45,000.00 - ZMW60,000.00 per month out of which she receives ZMW20,000.00 and after expenses can only afford to pay the Plaintiff the proposed ZMW5000.00 per month. I have considered the age of the debt and the payment proposals. The proposal of a monthly instalment of ZMW5000.00 which at today 's rate is equivalent to USD227 .00. From a quick calculation, and if the Court were to accept payment of the proposed instalment, it will take 491 monthly instalment payments translating to over 40 years to settle the Judgment debt which continues to accrue interest. This by all means will not be just and fair to the Plaintiff. I find that the Judgment debt will remain outstanding for an unconscionable length of time and there will be no considerable and meaningful reduction of the Judgment debt thereby denying the Plaintiff the fruits of his Judgment. The pt Defendant's payment proposals are totally unreasonable and unrealistic. The 1st Defendant states she may increase the instalment payments should her business improve. I find this speculative. The 1st Defendant states there is a money Judgment and exhibited a Consent Judgment. A perusal of the Consent Judgment shows the 1st Defendant is the 3rd Respondent therein and also a guarantor. The loan R7 I Page was obtained whilst the pt Defendant had contractual obligations to the Plaintiff as far back as 5th October 2012. In my considered view, the pt Defendant's action should not prejudice the Plaintiff. It is apparent the Defendant has not shown seriousness in paying the Judgment debt. I say so as the Court of Appeal rendered its Judgment on 30th April 2019 and she only paid the sum of ZMW15,000.00 on 8th July 2019 and thereafter made little effort to settle her indebtedness to the Plaintiff. Following the dismissal of leave to appeal to the Supreme Court, this application was dismissed on 29th September 2020 and there is no proof of any further payment to the Plaintiff. Taking into account all the circumstances of this case, the conduct of the 1st Defendant and the payment proposals made, I decline to exercise my discretion in favour of the 1st Defendant to settle the Judgment debt in instalments. Costs follow the event. Delivered and dated at Lusaka this 2P1 day of May, 2021. ........................................ IRENE ZEKO MBEWE HIGH COURT JUDGE RS I Page