Sundeep Kantilal Ranchod v Donovan Gray (CAZ/08/032/2020; CAZ Appeal No. 211/2020) [2023] ZMCA 406 (14 March 2023)

IN THE COURT OF APPEAL OF ZAMBIA HOLDEN AT NDOLA (Civil Jurisdiction) • BETWEEN: CAZ Appeal No. 211/2020 CAZ/08/032/2020 For the Appellant : Mr. L. Mwamba of Messrs Simeza Sangwa & For the Respondent : Mr. K. Wishimanga of Messrs AMW & Co. Associates JUDGMENT Chishimba JA, delivered the Judgment of the Court. CASES REFERRED TO: 1) Re Duke of Ma rlborough, Da vis v Whitehea d (18 94) 2 Ch. 133 2) Rich ard Willia m v Willia m Owen. Englis h Rep orts, 41 Chancery ((1 84 1) 5 The Juris t 114) 3) Kalu s h a Bwa lya v Chadore Propertie s & Ian Cha munora Nyalungwe Haluperi Selected -SCZ Judgm ent No. 2 0 of 2 0 15 4) Angel Musonda v Pulse Financia l Services CAZ Appeal No. 132 of 201 7 5) Engen Petroleum Zambia Limited v Willis Lu ha n ga & J erom e Lu mba SCZ Appeal No . 117 of 2016 6) Wilson Masau so Zulu v Avonda le Hou s ing Project Limited (1982 ) Z. R. 172 7) Nkhata & Othe rs v The Attorney Genera l (1 966) ZR 124 8) Kenmuir v Ha ttingh (1 974) Z. R. 162 -J. 2- 9) BJ Pou ltry Fa rms Lim ited v Nu tri Feeds Zambia Lim ited SCZ J udgmen t No. 3 of 2 0 16 10) Codeco Limited v Elias Kangwa & Others SCZ Appeal No. 199/ 201 2 1 1) Santly v Wilde 1899 2CH 474 12) African Ba nking Corporation Limited v Plinth Tech n ical Works Limited & Oth er SCJ No.28 of 2 01 8 13) Holmes v Buid well Con struction Compa n y Limi ted 14) Bwalya Chishimba Ka mbwili v Great Wall Fina n cia l Services Limited CAZ Appeal number 0 28 /2 02 1 LEGISLATION CITED: 1) The Land s and Deed s Registry Act Ch apter 185 of th e Laws of Zambia 2) The Court of Appeal Rules, S. I . No . 65 of 2016 WORKS CITED: 1. Robert Megarry, Charles Harpum & Willa im Wade. (2 01 2) The Law of Real Proper ty paragraph 25-085 2 . Wayne Cla rke. (2 000) . Fish er and Ligh twood 's Law of Mortgage. 11 th edition. Butterwor th s 3. Phipson on Eviden ce, 14 th edition , para. 37-26 4 . Chitty on Contracts, Volume 1, Gen eral Principles a t paragra ph 12- 1 11 5 . Black's Law Diction ary by Bryan A. Garner. 6 . Hals bury's Laws of Engla nd 4 th Edition, Volume 32, para. 4 0 1 7 . Ch eshire and burn's Modern Law of Real p roper ty 13 th Edition by E . H Burn 1982. 8. Coote on Mortgages 9th Edition page 29 (1927) R. L. Ra m s bolham 1.0 INTRODUCTION 1.1 This appeal s eeks to assail the judgment of the Hon. Mrs. Justice F . M. Chisanga, a s she then was, d a ted 21 st J anuary, 2020, in which she held that the contract of sale though couch ed a s an absolute sale was in fact a mortga ge with the equity of redemption available. The court h eld that the -J.3- transaction between the parties was a mortgage with the equity of redemption being available. The learned Judge ordered the Registrar of Lands and Deeds to cancel the certificate of title held in the appellant's name and restored the same to the respondent. 1.2 The court below further ordered the appellant to refund the respondent the sum of K72, 250.00 (rebased) paid in excess of the amount that was borrowed. 2 .0 BACKGROUND 2.1 The respondent commenced an action by way of writ of summons against the appellant and Dimple Sikand Ranchhod in the lower court endorsed with the following reliefs: 1) damages for fraudulent conversion by the appellant of the respondent's property Stand No. 33023, Lusaka; 2) damages for professional misconduct as against the responde nt's wife; 3) an order directing the Registrar of Lands and Deeds to cancel the certificate of title No. 37706 issued to the appellant and to restore the said certificate of title into the appellant's name; 4) in the alternative, an order that the registration of the assignment out of time without leave of court to register out of time is void; 5) an order that the sum of K72, 250. 00 paid by the respondent to the appellant as additional unlawful interest be refunded to the respondent; 6) an order that Toyota Corolla Motor Vehicle Registration No. ABD 9120 unlawfully obtained by the respondent from the appellant as additional interest be returned to the appellant and registered back into his name; -J.4- 7) damages for unlawfully obtaining and using the appellant's Toyota Corolla motor vehicle; 8) an injunction against the appellant to restrain him from selling Stand No. 33023, Lusaka; interfering with the respondent's quiet enjoyment of the said property and from selling Toyota Corolla motor vehicle registration No. ABD 912 0; 9) interest and costs. 3.0 EVIDENCE ADDUCED IN THE COURT BELOW 3.1 At trial, the r espondent testified that he borrowed the sum of Kl00, 000.00 from the a ppellant and his wife Dimple Ranchhod (the 2 nd defendant) to b e repaid with interest of K25 , 000 .00 in November 2 004. As security for the loan, the r espondent was to surrender his certificate of title to Stand No. 33023, Lusaka to the appellant and executed a contract of sale. The contract of sale was drawn by Messrs. Ranchod & Chibundi Legal Practitioners, a firm run by the 2 nd d efendant, who also acted as counsel for both parties. 3.2 The contract of sale was executed on 5 th October, 2004 and on the same date , a deed of assignment was also prepared. The contract of sale contained a special condition tha t the contract could be rescinded upon the respondent p ayin g b ack th e full amount of money borrowed with inter est before 29 th November, 2 004 . -J .5- 3.3 The respondent was requested and issued a postdated cheque in the sum of Kl24, 500.00 in favour of one of the appellant's companies. The respondent made payments towards payment of the loan amounting to Kl 19, 000.00 by 29 th November, 2004 leaving a balance of KS, 500.00. Despite the above, the appellant and the 2 nd defendant demanded that he pays additional interest because the money loaned to him was obtained through an overdraft facility. As a consequence, the respondent paid the appellant and the 2 nd defendant a total of K72 , 250.00 in excess of the sum of Kl 25, 000.00. 3.4 In due course, the respondent became aware that the appellant was trying to buy the property and had in fact converted his title deeds into his name without permission. The change of the title deeds was done notwithstanding the assurance that was given to him by the 2 n d defendant that she was the one to obtain State Consent, and that if the lawyer were to obtain consent, they would have to get a court order. 3.5 The respondent testified that though the 2 nd defendant's law firm applied for State Consent, he never gave h is consent to assign and was not aware of the transaction. -J.6- 3.6 The respondent further told the court that he sold air conditioners to the appellant for which he was paid Kl 5, 000.00 and K6, 000.00 for kitchen items. 3.7 In cross-examination, the respondent stated that he did not withdraw the postdated cheque for Kl24 , 500.00 because it was a guarantee together with his title deeds. He conceded that cheques for KIO , 000.00 and KS, 000.00 dated 22 nd and 23rd February, 2005 respectively were dishonored. 3.8 PW2, Mwenya Andrew Mukupa an advocate with Messrs. Ranchod and Chibundi Legal Practitioners prior to its dissolution, testified that the 2 n d defendant, a partner in the firm , had assigned him to draw up the contract of sale between the appellant and respondent. He was also instructed to insert clause 11 in the contract. In cross-examination, he denied preparing the consent to assign and the assignment as by January 2005, he had moved to Messrs. Mulenga Mundashi & Company. 3.9 In his defence, the appellant testified that in October 2004, the respondent approached him for a loan to clear motor vehicles. He advanced the respondent the sum of Kl44, 000.00 on condition that he be issued with postdated cheques. The -J.7- respondent was paid K23 , 000 .00 cash and two cheques of Kl00, 000.00 and K6, 000.00 on 8 th October, 2004. Further the sum of K15, 000.00 was paid to him on 26 th October, 2004. 3.10 The appellant also gave the r espondent postdated ch equ es of K22 , 500.00 for 4 th November, 2004; K22 , 000.00 dated 12th November, 2004; and K25, 000.00 and K75 , 000.00 for 3 0 th November, 2004. Some of the above cheques were referred to drawer. Only the sum of Kl 19, 500.00 out of K144, 000.00 was paid back. 3.11 As the respondent needed more cash, he offered the appellant his plot which he agreed to purchase for K125, 000.00 on 5 th October, 2004. It was agreed that should the respondent return the money by 29th November , 2004, t h e appellant would tear up the contract as h e was not inter ested in buying the property. In that regard, the r espondent issued to the appellant a postda ted cheque of K1 2 4 , 500. This was in anticipation that the contract would be null and void. The said postdated ch eque was dishonored. The deadline elapsed without the respondent paying back the sum of K125, 000 .00. 3.12 The a ppellant further testified that Weluzani Tembo, a friend of the respondent , iss ued three cheques, two in the sum of KIO, -J.8- 000 .00 and one for KS, 000.00 which the appellant deposited around 22n d February, 2005. Only one cheque for Kl0, 000.00 was credited with the rest being referred to drawer leaving a balance of KlS, 000.00. 3.13 In March 2005, the respondent offered his vehicle a Toyota Corolla to offset the balance owed. The appellant accepted the offset. The respondent left the vehicle with all the paperwork. The witness denied demanding interest on the money lent to the respondent. 3.14 The appellant proceeded to pay the property transfer tax. In April 2005, the respondent signed the deed of assignment without being forced or coerced. Thereafter, the appellant went on to obtain the certificate of title in his name. 3.15 In cross-examination, the appellant denied being supplied air conditioners by the respondent. He further denied altering or super-imposing the date on the contract of sale and assignment. 3.16 DW2 , Dimple Sikand Ranchod (the 2 nd defendant) stated that she asked one of her associates (PW2) at Ranchod & Chibundi Legal Practitioners, to prepare a contract of sale. In January 2005, it became apparent that the respondent had defaulted in -J.9- settling the loan obtained from the appellant and his obligations to the law firm. She then instructed PW2 to obtain state consent to assign and property transfer tax. Prior to this, a decision had been made that her law firm be merged with Messrs. Mulenga Mundashi without her as she had decided to pursue other interests. 3 . 17 Ms. Ranchhod requested, the appellant to get the respondent to sign the assignment, which was executed in April, 2005. She denied representing the respondent in the transaction and asking the respondent, a bachelor, to buy baby clothes and kitchen appliances for her. 4 .0 DECISION OF THE COURT BELOW 4 .1 The learned Judge in the court below considered the pleadings and the evidence adduced. The court framed the issues for determination as follows: 1) Whether the r espondent borrowed K269 , 000.00 from the appellant on the same date in October 2 004, as opposed to Kl00, 000.00; 2) Whether the transaction between the parties was a mortgage or sale of Stand No. 33023 , Lusaka; -J.10- 3) Whether Messrs. Ranchod & Chibundi Legal Practitioners acted for the respondent in the transaction; 4) Wheth er the appellant fraudulently changed the title of the property in his name; and 5) Who was the lawful owner of the proper ty in issue. 4.2 As the parties led evidence that was contradictory on what h a d transpired b etween them, the learned Judge reasoned that resolution of the issues rested on cr edibility which would to a large extent, be premised on documentary evidence adduced by the parties. 4 .3 With r esp ect to the first three issues for d etermination, t h e learned Judge took the view that the respondent's version of what transpired was more credible than that of the appellant. 4.4 She considered the learned authors Robert Megarry, Charles Harpum & Willaim Wade . (2012) The Law of Real Property paragraph 25-085 and Wayne Clarke. (2000) . Fisher and Lightwood's Law of Mortgage. 11 th edition. Butte rworths. page 1 1 and th e cases of Re Duke of Marlborough, Dav is v Whitehead (ll and William v Owen '21 at p. 386 who all espouse the principle that if a transaction is in substance a mortgage, equity will treat it as such, even if it is dressed up in some other -J.11 - guise, as by the documents being cast in the form of an absolute conveyance. 4.5 The court below found it strange that being parties to an outright sale, the parties inserted a clause - clause 11 of the contract of sale - that left room for the purchase price to be refunded. 4.6 The court considered the cheques in the bundles of documents including the letter of sale of the motor vehicle belonging to the respondent, and found that the appellant received Kl66 , 750.00 in total from the respondent contrary to his evidence that he lent the respondent Kl 44, 000.00 and charged no interest. The learned Judge found that the appellant was not telling the whole truth and believed the respondent's version of events notwithstanding that it sounded incredible in that he paid way more than he should have done on mere threats. 4.7 The court below did not believe the appellant's version because it failed to accommodate all the payments made by the respondent into the sum of Kl44 ,000.00 including the additional sum he had purportedly lent to the respondent. She accepted that the respondent borrowed the sum of Kl00, 000.00 and interest of K25, 000.00 to make Kl 25, 000 .00 to be -J. 12- repaid before 29th November, 2004 for him to redeem his property. 4.8 That the respondent made payments even though he had issued a postdated cheque of Kl24, 500.00 to pay off the debt. That if the transaction had been transparent, the respondent would have been asked to pay property transfer tax and obtain state consent to assign as opposed to the appellant doing so without the respondent's knowledge. 4.9 She further observed that if the transaction had been genuine, a notice to complete should have been issued to the respondent by Messrs. Ranchod & Chibundi Legal Practitioners. Consequently, the learned Judge found tha t the transaction between the parties was a mortgage, the equity of r edemption being applicable as a result. The receipt of payments after the d eadline meant that the appellant was amenable to receive the due amount. Consequently, she determined the first, second and third issues in favour of the r espondent. 4.10 With respect to the relief sought for damages for fraudulen t conversion of Stand No. 33023 , Lusaka, the learned Judge found that the contract of sale, though couched as an absolute sale, was in fact a mortgage with the equity of redemption still -J.13- being available. The respondent having paid the agreed amount of Kl 25, 000.00, the appellant could not charge more interest than had been agreed. Therefore, the appellant was entitled to receive back his certificate of title by way of redemption and that the appellant was not entitled to change the same into his names. 4.11 The court below held that the respondent had not shown that he had suffered any damage on account of the change of title into the appellant's name. Similarly, the claim for professional misconduct against the 2 nd defendant was dismissed for being vague. 4.12 The court found that the respondent was entitled to redeem the property, and that having paid an additional sum of K72 , 250.00, was entitled to have the property restored back to him, as he had fully redeemed the mortgage. The court proceeded to order the Registrar of Lands and Deeds to cancel the title deed issued in the appellant's name for Stand No. 33023, Lusaka and to restore the same into the respondent's name . 4.13 The court further ordered the appellant to refund the sum of K72, 250 .00 paid as additional interest as it was not agreed to by the parties. The amount was to be repaid with interest at -J.14- average short-term deposit rate from the date of writ to the date of judgment, and thereafter at current bank rate till full payment. 5 .0 GROUNDS OF APPEAL 5. 1 The appellant, being aggrieved with the decision of the lower court, appealed and advanced the following grounds, that: 1. The lower court erred in law and fact by holding that the respondent's version of the story was more probable than the first respondent's; 2. The lower court erred in fact by holding that the respondent borrowed the sum of Kl00, 000.00 plus interest of K25, 000.00 and not K144, 000.00; 3 . The lower court erred in law and in fact by holding that the respondent was entitled to redeem the property if he paid the sum K125, 000.00 before 29t h November, 2004; 4. The lower court erred in fact and in law by failing to separate the sale agreement from the loan agreement; 5. The lower court erred in fact by holding that the respondent executed the assignment in the year 2004; 6 . The lower court erred in law and in fact by holding that the sale transaction between the plaintiff and the first defendant was a mortgage; 7 . The lower court erred in law and in fact by ordering the Registrar of Lands and Deeds to cancel the title deed i n the appellant's name for Stand No 33023 and restoration to the respondent's name; and -J .15- 8 . The lower court erred in fact and law by ordering the appellant to refund the sum of K72, 250. 00 together with interest to the respondent. 6.0 APPELLANT'S ARGUMENTS 6 . 1 The appellant filed into court h eads of argument dated 4 th November, 2020. He began by arguing ground six, that the lower court err ed when she held that the sale transaction between the parties was a mortgage notwith standing the fact that there was an executed contract of sale embodyin g th e agreement and intention of the parties. 6.2 It was contended that the matter before t he lower cour t was on all fours with the case of Kalusha Bwalya v Chadore Properties, Ian Chamunora & Nyalungwe Haluperi 13l where the appellant, faced with financial difficulty, obtained a loan through the 2 nd r espondent who was a r epresentative of the 1st respondent on the condition that the appellant d eposited title deeds to his property. A contract of sale and deed of assignment was then signed . The responden ts su bsequently caused to be r egistered the assignment thereby effectively transferring title in the said property . 6.3 On appeal, the a ppellant argued that th e intention of the parties was to execute a loan agreem ent with t h e subj ect property as -J.1 6- security. That the appellant had the mortgagor's right of redemption. The Supreme Court rejected this argument. 6.4 It was argued that the Supreme Court was dealing with similar facts as in the present case and as such, the parties herein are bound by the documents they signed. Further, that their intention is discernible from the same documents. For this reason, the lower court was bound to follow the decision of the apex court whether or not the court agreed with that decision. 6.5 The appellant contends that the lower court, in its judgment acknowledged the decision of the Supreme Court in the Kalusha Bwalya case but declined to follow the precedent because it held a different view or opinion. By holding that the sale transaction was a mortgage, the court below ignored or rewrote the agreement between the parties. 6.6 Though the agreement was clear and in writing, the respondent argued that the transaction was not intended to be an outright sale, but a loan. Following the Kalusha Bwalya case, it was submitted that the real intention of the parties, as d iscerned from the parties' clause and recitals of the contract of sale and assignment was that it should be an outright sale of the property from the respondent to the appellant. -J .1 7- 6.7 The appellant submits that, what th e lower court did was to discard the agreement and set up fresh terms by holding that the transaction was a mortgage in contradiction of the intention and terms of the contract. Citing our decision in t h e case of Angel Musonda v Pulse Financial Services !4 l and the Supreme Court d ecision of Engen Petroleum Zambia Limited v Willis Luhanga & Jerome Lumba '51 , counsel submitted that the lower court was duty bound to give effect or enforce the terms of the agreement between the parties, wh ose express terms posit that the transaction was a sale. 6.8 It was further submitted that the lower court misdirected itself from its misappreh ension of clause 11 of th e contract of sale by using it as a basis to find that the sale was not an ordinary sale and for admitting parole evidence . That it cannot be seen from a perusal of clause 11, whose import is to give th e r espondent a right of rescission, that the sale was a mortgage or that it was not an ordinary sale. In finding that the agreement was a mortgage, th e lower court r e-characterised the agr eement. 6.9 Citing the case of Richard Williams and William Owens '21 relied on by the trial court, the appellant submitted that when d etermining whether an agreement was a m ortgage under the -J.18- guise of a sale , the key consideration 1s whether there are provisions in the agreement that are akin to the rights that normally arise in a mortgage. That in the contract of sale and assignment before court, there are no such rights. 6. 10 The appellant further distinguished the cas e of Re Duke of Marlborough, Davis v Whitehead 11l arguing tha t it concerned a deed of absolute assignment of lease which contained the equ ity of redemption. That the question before the court was simply to whom the right was reserved given the limited nature of the conveyance. Similarly, the Williams case was distinguished on the basis that it was d ealing with a situation where there was only what purported to be a contract of sale without further steps taken by the parties such as th e assignment in this appeal. 6. 11 Grounds one, two, three and four were argued together. The app ellant cited the case of Wilson Masauso Zulu v Avondale Housing Project Limited l6 l and urged us to reverse the findings of fact of the lower court on the b asis th at they were perverse which, on a proper view of the evidence , no trial judge would have arrived at. -J. 19 - 6.12 We were referred to page 39 of the record of appeal where the learned Judge, after analyzing the evidence, stated: "The above facts tend to cast doubt on the plaintiffs account if taken in isolation from the defendant's evidence." It was submitted that in essence, the trial court was saying tha t the respondent had failed to prove his case but shockingly went on to shift the burden of proof to the appellant by pointing out what it considered to be deficiencies in the appellant's case and entered judgment in favour of the respondent. 6.13 It was contended that the burden was on the respondent to prove that the transaction was a mortgage, which h e failed to discharge as evidenced by the lower court's own finding that his evidence was doubtful. We were urged to set aside the judgment of the lower court on this basis alone. 6 .14 The appellant argued that the court below entered judgment in favour of the r espondent b ased on the 'd eficiencies' it pointed out in the appellant's case without addressing its mind to whether or not the respondent, as plaintiff, had proved his case. That this was contrary to the guidance in the Wilson Masauso Zulu case that a plaintiff who h as failed to prove his case is not -J.20- entitled to judgment whatever can be said of the opponent's case. 6. 15 The appellant's contention being that judgment was entered in favour of the respondent without consid eration of his case, and neither was there any consideration of whether or not the respondent had proved his case. Even after shifting the burden of proof, the court below was said to have completely misapprehended the evidence before it. 6.16 It was argued that when subjected to conflicting testimony from the parties, the court below took the view that the respondent's story was more probable and concluded that the respondent borrowed the sum of Kl 00 , 000.00 with interest of K25, 000.00 to make a total of Kl25, 000.00. That had the court below followed its own guidance to consider the documents on record, it would have found that the respondent had in fact sold his property for Kl25, 000.00, as per clause 8 of the special conditions in the contract of sale and the postdated cheques in the sum of Kl24, 500.00 and the cheque for K75, 000.00. This was in addition to the Kl 44, 000.00 that was initially borrowed. 6.17 The appellant submits that the postdated cheque of Kl24 , 500.00 was meant to refund the purchase price, while the -J.21 - cheque of K75, 000.00 dated 30th November, 2004, a date after the deadline, was not meant to be a refund of the purchase price. That the only reasonable conclusion that can be drawn is that there was another debt that the respondent was paying being that of K144, 000.00 made up of cheques of K22, 500.00, K22, 000.00, K75 , 000.00 and K25 , 000.00 paid between 4 th and 30th November, 2004. 6.18 The last cheque of K25 , 000.00 having 'bounced', was replaced by the three cheques of KlO, 000.00, KlO , 000.00 and KS , 000.00 paid by Weluzani Tembo together with the sale of the Toyota Corolla motor vehicle to offset the K 15, 000. 00 outstanding balance on the bounced cheques. This shows that while the loan of K125, 000.00 was settled by the sale of the property, there was a second loan of K144, 000.00 as evidenced by the cheque p ayments. Though alive to the fact that the respondent h a d paid more than what h e was claiming was lent to him, the court below went on to gloss over the evidence without analyzing it or paying attention to its impact on the respondent's testimony. 6 .1 9 The appellant further contended that the letter of sale of the motor vehicle confirmed that the respondent owed the appellant -J.22- money to be deducted from what he owed and that the vehicle was in fact sold for K25, 000.00 and not K37 , 500.00. 6.20 It was submitted that had the lower court directed itself properly on the evidence, it would have come to the conclusion that the two agreements were separate. That the misdirection was because it found the respondent's story more probable than that of the appellant. 6.21 With respect to the finding that the assignment was signed in 2004 and not 2005, it was submitted that the court below ignored the evidence on record to arrive at the conclusion on the mere basis that the word 'five' was inserted in ink. This was so even when DWl and DW2 testified that it was executed in 2005 and whose evidence was corroborated by PW2 who could not remember whether or not it was in 2005. 6.22 In grounds seven and eight, the appellant submits that the lower court failed to analyse the evidence in a balanced manner and made various findings of fact that were perverse, resulting in the court to order cancellation of the certificate of title. The court below failed to realise that the transaction was an absolute sale which was a separate and distinct agreement from the loan agreement. -J.23- 6.23 That the same goes for the order to refund the sum of K72 , 250.00 as excess interest paid by the respondent to the appellant without any evidence to support it. We were urged to set aside the judgment of the court below and reverse the order for cancellation of the certificate of title and payment of the sum of K72 , 250 .00 with costs. 7.0 RESPONDENT'S ARGUMENTS 7.1 The respondent filed heads of argument dated 26 th March, 2021. It is submitted that the entire appeal hinges on the dissatisfaction with findings of fact made by the trial court. That an appeal on findings of fact is seldom allowed unless the qu alifications set out in the case of Nkhata & Others v The Attorney General 171 and the Wilson Zulu v Avondale Housing Project Limited 161 are satisfied. That th e trial court having had the opportunity to hear and see the witnesses, had the advantage of observing their demeanour and cannot be reversed as per the case of Kenmuir v Hattingh 181. On this basis, we were urged to dismiss the appeal forthwith. 7.2 The respondent addressed grounds one, two, three, four, five and six together which challenge the findings of the court below that the transaction between the a ppellant and the respondent -J .24- though guised as a sale, was in fact a mortgage transaction. The respondent argued that contrary to the assertion by the appellant, the Kalusha Bwalya case is not on all fours with the present case. That the trial Judge , when she referred to it, was merely noting that the said case was distinguishable on its facts. 7.3 The respondent distinguished the Kalusha Bwalya case from the present in three ways in that: i) the appellant executed a contract of sale and assignment without anything more and then attempted, at trial, to show that the true intention of the parties was that the transaction was not an outright sale but rather a mortgage; ii) the contract of sale had provision for a r e-purchase of the property whereby the appellant was given the first right of refusal to purchase the property from the new owner; and iii) the appellant was claiming rescission of the contract of sale based on misrepresentation, fraud and mistake. 7 .4 Thus, the case was dismissed on the ground that from the documents signed, the parties ' intention was clearly expressed -J.25- and that there was no other intention other than that of an outright sale. 7 .5 It was submitted that clause 11 of the contract of sale suggested more than a mere sale and purchase transaction. In the Kalusha Bwalya case, the appellant argued that the intention to create a mortgage was discussed in prior engagements between the parties. However, this alleged intention was never reduced in writing unlike in the present case where the discomfort of the respondent to sign the contract of sale resulted in DW2 inserting special condition No. 11 in the contract. Therefore, the two cases are in no way similar. 7.6 It was submitted that the trial Judge construed the documents on record and properly dealt with the oral testimony before her in arriving at a decision. That in her reasoning, the trial Judge noted that sometimes, sales with rights of repurchase have been held to be mortgages, and that the over-riding criterion is the intention of the parties thereto which, apart from the documents used in the transaction, may be expressed from other factors thereby justifying the reliance on parol evidence. 7. 7 It was argued that faced with two conflicting versions of the same story, the court below was duty bound to determine the -J.26- true intention of the parties more so that there was uncontested evidence that the appellant gave the respondent a loan of KlOO, 000.00. 7 .8 As to whether or n ot the lower court was entitled to refer to extrinsic eviden ce in the circumstances, the r espondent placed reliance on a plethora of authorities, among them Phipson on Evidence, 14th edition, paragraphs 37-12 and 37-26 where the learn ed authors state as follows: 3 7-12 "... the extrinsic evidence rule applies when the document is accepted as a document operating in accordance with its terms. It does not exclude evidence which attacks it, e.g. as not being genuine or duly executed or not carrying out the true intention of the parties or subject to a condition." 37-26 "extrinsic evidence (including, in some case, direct declarations of intention) is admissible to show the true nature of the transaction, or the legal relationship of the parties, although such evidence may vary, or add to the written instrument . ... thus a sale, absolute on its face, may be proved by extrinsic evidence to be a loan on security; a conveyance merely a mortgage." Our attention was also drawn to the learned a u thors of Chitty on Contracts, Volume 1, General Principles at paragraph 12- 111 who state that: -J .27- "Extrinsic evidence is admissible to prove the true nature of the agreement, or the legal relationship of the parties, even though this may add, vary or add to the written instrument. Thus, a conveyance may be shown to be merely a mortgage. " 7. 9 In this regard, the respondent submitted that the lower court was entitled to refer to extrinsic evidence to determine the true intention of the parties based on the documents and the testimony before her. That a consideration of the evidence of the respondent at page 290; DWI at pages 317 - 318 and DW2 at pages 332 - 333 of the record of appeal shows that the transaction between the parties was purely a lending and borrowing between the appellant and th e respondent. The transaction contemplated by the parties was a loan with the property as security. 7.10 On this basis, it was argued that the respondent had proved his case contrary to the position advanced by the appellant that clau se 1 1 of the contract of sale provid ed a r ight to rescission, that is, mutual release of the parties from their obligations under the contract where neith er party has completely performed their obligations under the contract. A close reading of Clause 1 1 shows that it only applied to the respondent. -J .28- 7.11 The respondent submitted that the contract of sale between the parties was merely a mortgage and drew confidence for this argument from the definition of a mortgage in Black's Law Dictionary by Bryan A. Garner at page 1031 that it is: " ... a conveyance of title to property that is given as security for the payment of a debt or the performance of a duty and that will become void upon payment or performance according to the stipulated terms." 7.12 We were further r eferred to the learned a uthors of Halsbury's Laws of England 4 th Edition, Volume 32, para. 401 who state as follows: " ... generally, whenever a disposition of an estate or interest is originally intended as a security for money, whether this intention appears from the deed itself or from any other instrument or from oral evidence, it is considered as a mortgage and redeemable" 7. 13 It was further submitted that a look at the relevant circumstances shows that the transaction was a mortgage as there was a lending, provision to pay interest and an opportunity to red eem the property. 7.14 As regards the position taken by the appellant that on 5 th October, 2004 he actually lent the respondent two loans of Kl 44, 000.00 (paid in three instalments of K23 , 000 .00 on 5 th -J.29- October, 2004, K6, 000.00 and Kl00, 000.00 on 8 th October , 2004) and K125, 000.00, it was argued that this was strange. That the version of the respondent, accepted by the trial court, was tha t h e obtained a loan of Kl00, 000.00 at K25 , 000 .00 interest to make a total of K125 , 000.00 for which he issued a postdated cheque of K124 , 500.00 as a refund of the purchase price. This version was supported by the evidence of the bank statement which shows that only Kl00 , 000.00 was paid to the respondent by the appellant. 7 .15 On the registration of the a ssignment dated 8 th April, 2005 on 4 th April, 2004 at the Lands and Deeds Registry, the respondent submits that the said assignment was null and void for want of r egistration in terms of sections 5 and 6 of the Lands and Deeds Registry Act, Chapter 185 of the Laws of Zambia. That there could be no assignment of the property in issue outside of the mandatory registration periods provided by the law. 7 .16 The respondent argued that the court below did not shift the burden of proof to the appellant. Rather, when faced with two conflicting positions, the court made a finding as to which story was believable . Reliance was placed on the case of BJ Poultry Farms Limited v Nutri Feeds Zambia Limited 191 where the -J .30- Supreme Court guided that in such circumstances, a trial judge is entitled to accept the version that she finds more probable than not, and give reasons why she accepts the particular version and not the other. Therefore, there was no shifting of the burden of proof. 7.17 In ground seven and eight, the respondent submits that the lower court was on firm ground to order cancellation of the certificate of title issued in the appellant's name. This is b ecause the trial court rightly found that there was only one agreement, the contract of sale, which was, in its true nature, a mortgage. Having found that the loan had been repaid, the property was redeemable more so that the respond ent h a d repaid the loan in excess. 7.18 As regards the r efund of the K72, 250.00, the respondent submits that the said amount was found to h ave b een an excess payment. In any case, it was argued th at the judgment of the lower court has already b een enforced and taken its effect. The said property is now with an innocent third party, Faisal Ghumra. -J.31 - 8.0 APPELLANT'S ARGUMENTS IN REPLY 8.1 The appellant filed heads of argument in reply dated 24 th May, 2021 and submitted that it is factually incorrect to state that the entire appeal is premised on findings of fact. That the main ground of appeal, ground six, is not assailing findings of fact but is anchored on the various errors of law the lower court made. The rest of the grounds are anchored on both findings of law and fact. 8.2 As regards the arguments that the contract of sale was a mortgage; that the Kalusha Bwalya case is distinguishable from the case in casu; and that the trial court was entitled to consider extrinsic evidence, the appellant maintained that the situation the Supreme Court was dealing with in the Kalusha Bwalya case is the exact situation in this case. That there was a contract of sale and an assignment, with an argument that it was a mortgage, as is the situation here. 8.3 In the Kalusha Bwalya case, the Supreme Court took the view that the testimony of the parties is irrelevant so long a s the agreements themselves are clear. That the position of the appellant is that the trial court was bound to follow the -J. 32- guidance of the apex court as opposed to shelving the agreement and relying on extrinsic evidence. 8.4 The appellant further argued that what the respondent relied on as differences between this case and the Kalusha Bwalya case, are in fact similarities. Therefore, the lower court ought to have only considered the contract of sale and assignment before it to determine the intention of the parties herein. 8.5 As regards the argument that the assignment is null and void for want of registration, the appellant contends that this was never raised in the court below and cannot be raised on appeal. For authority, we were referred to the case of Codeco Limited v Elias Kangwa & Others 1101 . 8.6 The appellant insisted that the date of the assignment is clearly indicated as 4 t h April , 2005, though indicated in ink contrary to the finding of the lower court that it was executed in 2004. That this is confirmed when one looks at the executed contract at page 126 of the record of appeal which is indicated as "4 - 4 - 05". Therefore, the assignment was registered within the times provided by law. 8.7 The appellant maintained that the agreement between the parties was an outright sale in terms of clause 8 of the special -J.33- conditions, and not a mortgage; and that there were two agreements for Kl 44, 000.00 and Kl25 , 000.00. 8.8 It was submitted that the loan agreement is evidenced by the account statement at page 124 of the supplementary bundle of documents showing money paid out to the respondent and what the respondent paid to the appellant amounting to Kl44, 500.00. Hence the respondent issuing a postdated cheque of Kl24,500.00 and making payments amounting to Kl44, 500.00. 8.9 With respect to grounds seven and eight, the appellant submits that the findings of the court below were either perverse or made contrary to the evidence on record and that no reasonable tribunal would have made such findings. We were urged to reverse these findings. 8 .10 As regards the argument that a notice to complete ought to have been given, it was submitted that there was no need because the sum of Kl 25, 000.00 was already paid by the respondent. Therefore, clause 11 of the special conditions does not arise . We were urged to uphold the appeal with costs. -J.34- 9.0 DECISION OF THIS COURT 9.1 We have considered the appeal, the authorities cited and the arguments advanced by the learned Counsel for the Parties. The appellant has raised eight grounds of appeal which all revolve or flow from the holding by the court below that the transaction between the parties was a mortgage and not a contract of sale. In our view, the main issues for determination are as follows; (1) Whether the nature of the transaction between the parties was a contract of sale or a loan agreement secured by a mortgage. (2) If so whether the respondent was entitled to redeem the property pledged as security. In determining the above, the peripheral issues raised 1n the other grounds will be dealt with su ch as, (a) Whether there were two separate agreements i. e contract of sale and loan agreement. The amount in issue (ground 2) The date the assignment in issue was executed (ground (b) (c) 5) (d) Whether the court below erred by ordering the Registrar of lands and Deeds to cancel the title deed in the appellant's name and order restoration to the respondent (ground 7) (e) Whether the appellant was over paid by the sum of K72,250 (ground 8) -J.35- 9.2 Before delving into determining the appeal, we shall address the argument raised by the respondent that the appeal is founded on facts and not law, and as such, should be dismissed. A reading of the eigh t grounds of appeal reveals that only ground two and five attack findings of fact while th e rest of the grounds are a mixture of law and fact . 9.3 As regards the framing of grounds of appeal, Order 10 rule 9(2) of the Court of Appeal Rules, 2016 is instructive and provides as follows : A memorandum of appeal shall set forth concisely and under distinct heads, without argument or narrative, the grounds of objection to t he judgment appealed against, and shall specify the points of law or fact which are alleged to have been wrongly decided, such grounds to be numbere d consecutively. (emphasis added) 9.4 Our understanding of this provision is that an a ppellant may lodge grounds of appeal based on either points of law or fact, and is not restricted to points of law only or of mixed law and fact. Therefore, we find no fault with the manner the grounds of appeal are framed as they are consistent with the requirements of Order 10 rule 9(2) of the CAR. -J.36- 9.5 Reverting back to the main issue raised in ground six, whether the transaction in issue was a contract of sale or loan (mortgage) transaction, recourse is had to the definition of terms and the evidence on record, documentary as well as oral. A contract of sale is a legal contract for the purchase of assets by a buyer from a seller for an agreed upon value in money. A mortgage involves the transfer of an interest in land/property as security for a loan or other obligation. It is a legal instrument. The case of Santley v Wilde 1111 defined a mortgage as a conveyance of land as security for the payment of a debt or the discharge of some obligation. We will not belabor to delve into the different types of mortgages i.e legal or equitable. Save to state that the equity of redemption is the fundamental characteristic of mortgages. A mortgagor has the right upon payment of principal, and interest to redeem the property pledged as security. We refer to Cheshire and Burn's Modern Law of Real property 13th Edition by E. H Burn 1982. 9.6 It is not in dispute that the respondent was the beneficial owner of Stand Number 33023 Lusaka. In his evidence, he stated that he borrowed the sum of Kl00,000 from appellant to be repaid by 24 th November 2004 with interest in the sum of K25,000 . -J.37- The respondent issued a postdated cheque in the sum of Kl24,500 and as security handed over his certificate of title to the appellant. The respondent refutes having obtained a loan in the sum of Kl44,000=00 from the appellant. Further that he paid back the loan of Kl25,000 in excess of K75,250=00. 9.7 The respondent went on to sign the contract of sale and assignment. That the consent to assign was obtained without his consent. The dealing firm was not instructed to complete the transaction. 9.8 The respondent testified that he was uncomfortable with signing the contract of sale. Therefore, a special condition was inserted in by DW2 to allay his fears. PW2 who drafted the contract of sale, told the court below that he was instructed by his principle partner, to insert a special condition in the contract. A perusal of the contract of sale shows special condition No. 11 to the effect that the contract of sale, at any time before 29th November, 2004 may be rescinded by the vendor paying back (returning back) the full purchase price. 9. 9 There are two conflicting pieces of evidence by the parties in regard to the nature and amount of the transactions in issue. The appellant contends that there were two separate -J.38- transactions entered into between the parties. The first being the loan obtained in the sum of Kl44,000 by the respondent from the appellant. Th e s econd bein g a contract of sale of the stand No 33023 Lusaka enter ed into between the p arties for the sale and purchase of the prop erty for th e sum of Kl25 ,000=00 9.10 The respondent on the other hand argues that he obtained a m ere loan in the sum of Kl25,000 and no other transaction was entered into. 9. 11 We h ave perused the contract of s ale and th e assignment deed. The contract of sale dated 5 th October 2004 between the p arties was for the sale and purchase of th e stand No 33023 Lusaka at the purchase price of Kl25,000. Special condition number 11 stipulated that the; "Vendor may at any time before the 29t h of November 2004 return the full purchase price to the purchaser and rescind the contract provided that the same is done prior to the 29th of November 2004 and the full purchase price is returned". The assignment d eed also refers to the purch ase price of Kl25 ,000. 9. 12 The learned author of Coote on Mortgages 9th Edition page 29 ( 1927) R. L. Ramsbolham state as follows; .. -J.39- "The rule is that prima facie an absolute conveyance, containing nothing to show the relation of debtor and creditor, does not cease to be an absolute conveyance and become a mortgage merely because the vendor stipulates that he shall have a right to repurchase. In every case, the question is what upon a fair construction is the meaning of the instruments, and the absolute conveyance will be turned into a mortgage if the real intention was that the estate should be treated as security for the money. It is generally a question of construction in the light of surrounding circumstances." The author further stated that; "Equity will admit parole evidence to show that a conveyance, which is absolute in its terms was intended by way of security only and that a transaction though in form a sale is in reality a mortgage". 9 .13 The respondent contends that being uncomfortable with the signing of a contract of sale, special condition under clause 11 was inserted into the contract to alley his fears i.e the condition to rescind the contract upon return of the full purchase price to the appellant. Therefore the gist of the appellant's contentions being that the true intentions of the parties upon executing the contract of sale was to create a relationship of lender and borrower. Further as security the property in issue was given. -J.40- 9.14 As regards where the onus of proof lies, it is incumben t upon • the person pleading that the transaction is not in consonance with the appearance to adduce evidence to the contrary. In this case on the respondent. 9 . 15 In construing the nature of the transaction entered into recourse is had to the examination of the terms of the document. The conclusive test is the intention of the parties which can be gathered from the language of the document. 9.16 The Supreme Court in the case of African Banking Corporation Limited v Plinth Technical Works Limited & Other 1121 stated as follows; "the function of the court is to ascertain what the parties meant by the words which they have used; to declare t he meaning of what is written in the instrument, not of what was intended to have been written and to give effect to the intention as express ed". 9.17 We have perused the contract of sale and deed of assignment, and consent to assign. After considering the contents of the documents, the circumstances of this case, we come to the conclusion that the transaction in question was a contract of sale. The intention of the parties was to enter into a contract of sale agreement. To constitute a mortgage, there must be debt -J.41- and security. We hold the view that the intention by the parties was for the respondent to sell and the appellant to purchase the property in issue for a consideration of K125 ,000 . 9 . 18 The contract of sale herein contained a provision to return the full pu rchase price to th e respondent by the appellant before the 29th of November 2004. Upon fulfillment of that condition, th e contract would be rescinded . Returning of the purchase is more or less a buy back option. 9.19 This case is, in our view, on all fou rs with the case of Kalusha Bwalya v Chadore Properties Limited & Others 131 in which the special conditions provided for a repurchase of the property whereby the vendor was given the first right of refusal to buy back the property. The Supreme Court in determining the intention of the parties, held that: " ...... the intention of the parties here is discernable from the documents signed by them freely and voluntarily as the acknowledgment of receipt con.firms. The parties chose to embody their agreement in two documents namely the contract of sale and the deed of assignment. They are bound by those documents in the absence of fraud, mistake or misrepresentation ...... " 9.20 The apex court went on to state that extrinsic evidence is not generally a dmissible to add, vary, subtract from or contradict -J.42- • the terms of the written contr act as held in Holmes V Buidwell Construction Company Limited 1131. The lower court was therefore bound as we are to follow the decision of the apex court on account of the principle of stare decisi (Hierachial Precedent). 9.21 We hold the view that the intention of the parties from the documents on record was that the transaction was a contract of sale of stand No 33023 Lusaka. 9.22 In our recent decision in the case of Bwalya Chishimba Kambwili v Great Wall Financial Services Limited 1141, where the parties executed a contract for sale of property containing a clause with an option to buy back the property before a certain date, failure to which the appellant would transfer the property to the respondent and deed of assignment was executed; the issue therein being whether the parties true intentions were to create a borrower /lender relationship with the property being used as security for the loan, we construed that the intention of the parties was for the Appellant to sell and the respondent to purchase the property in issue. 9.23 We went further to state as follows: -J.43- "the only unique feature of this contract of sale is that it contains a buy-back provision which gave the appellant the opportunity to regain ownership and possession of the property if he refunded the purchase price before the 30th July 2018. The buy-back provision in the contract does not in our view imply that the parties entered into a loan agreement secured by a mortgage". 9.24 Equally, in this case, the provision for rescinding of the contract upon the return of full pu rchase price before the 29 th of November 2004 does not imply that the parties entered into a loan agreement secured by a mortgage over stand number 33023. 9. 25 Therefore, we hold that the lower court erred by holding that the transaction was a mortgage, su bject to equ ity of redemption. The respondent does not dispute failure to pay back the sum of Kl 25,000 before the 29 th of November 2004. The availed window period to obtain back property upon the return of the full purchase price and rescinding of t h e contract fell away upon default. Having h eld that the transaction in issue was a contract of sale of stand number 33023 for the sum of Kl25,000 we find merit in grounds 3 ,4 ,5 and 6. It goes without stating the obvious that, the nature of the transaction being a contract -J.44- of sale of property, it is academic to determine ground 2, the • amount borrowed as the contract is for a sale and not a loan/mortgage transaction. We further hold that the court below erred by ordering the Registrar of Lands and Deeds to cancel the title deed registered in the appellant's name for stand number 33023 and restoration to the respondent. 9.26 The only issue remaining to be determined is whether the court erred by ordering the appellant to refund the sum of K72,250 paid over and above. Having held that the nature of the agreement was a contract of sale, the issue is the fate of the payments made by the respondent after the property was conveyed by deed of assignment to the appellant who accepted this sum. 9 .27 The appellant challenged the decision of the trial Judge to accept the version of the respondent as being more probable than that of the appellant. It was argued that from the comments made in the course of delivering the judgment, the learned Judge was in essence saying that the appellant had failed to prove his case when this was not the case. The appellant then urged us to reverse the findings of the trial court. -J.45- 9.28 In the case of BJ Poultry Farms Limited v Nutri Feeds Zambia • Limited 191 cited by the respondent, the High Court was confronted with two versions of what was alleged to have caused the deaths of the appellant's poultry birds. The learned trial Judge reasoned that the version of the respondent was more probable than that of the appellant and entered judgment accordingly. 9.29 In upholding the lower court's finding, the Supreme Court stated as follows: " ... All we can say is that the learned Judge was entitled to accept the version that she found more probable than not. And she also gave reasons why she accepted the Defendant's version and not that of the Plaintiff. Therefore, we cannot fault her for coming to the conclusion that she did." 9.30 In the matter before us, the learned trial Judge considered the evidence adduced before her and noted that the resolution of the issues therein rested on credibility which was largely premised on the documentary evidence adduced by the parties. She then reviewed the evidence on record and made her findings. Having reviewed the documentary evidence on record, and arriving at the conclusion that the transaction in issue was a contract of sale, we find merit in the ground to the extent that -J.46- • based on the evidence adduced, the court below erred in resolving the issue on credibility by accepting the respondent's version as being more probable than that of the appellant. 9.31 As regards the contention in respect of the date the assignment was executed, pages 123 to 126 of the record of appeal shows that the date in the parties' clause, that is the year, had the word ''five" overwritten on the word ''four". The respondent testified that he executed the contract of sale and assignment at the same time in 2004. In our view, the assignment was executed in 2004. It is more probable that the appellant altered the date of the assignment. In any event, the date of the deed of assignment is immaterial to the main issue at hand. The respondent admits having executed the deed of assignment. Therefore, we uphold the court's holding that the assignment was executed in 2004. 9.32 Having earlier held that the transaction between the parties was in fact a contract of sale agreement for the consideration of the sum K125,000, the next issue to be determined is whether the respondent exercised the provision in the contract to return the full purchase price within the window period to warrant order for cancellation of the title deed issued in appellant's name. -J.47- 9.33 It is not in dispute that the contract of sale was for the sum of • K125,000. Clause 11 for return of the full purchase sum was to be exercised by 29 th November 2004. The evidence adduced by the parties is that the respondent issued a postdated cheque in the sum of K124,500 which was not honoured. As at 29th November 2004, the respondent had not returned the full purchase price of K125,000. Hence the appellant registering the property in his name. 9.34 It appears that the respondent being under the mistaken impression that the transaction was a loan, continued to make further payments beyond the date of 29 th November 2004. The respondent gave the appellant a vehicle valued at K37,750 with instructions for him to retain and apply to the loan. In addition, a colleague of the respondent, Mr Weluzani Tembo paid on his behalf the sum of Kl0,000 by cheque which was cleared. The respondent further in January 2005 paid a cash sum of K30,000 to the appellant. 9.35 We are of the view that the respondent is entitled to a refund of the sum of K72,250 paid after the property was conveyed by way of sale to the appellant. The appellant cannot be unjustly enriched by retaining the property after the respondent failed to -J.48- • return the full purchase price as well as keeping the sum of K72,250 paid after 29th November 2004. The appellant is only entitled to the property which he duly registered in his name. The amount paid over and above whether under ignorance of the nature of transaction by the respondent is refundable. Therefore, the court below was on firm ground to order refund of the sum of K72,250. 9.36 We hold that the court below was not on firm ground to order the Registrar Lands and Deeds to cancel the title deeds issued to the appellant and have the property restored to the respondent. The respondent was not entitled to redeem the property because the nature of transaction in issue was a contract of sale and the option to rescind the contract upon return of the full purchase price having elapsed without full payment being made to appellant. 10.0 CONCLUSION 10.1 In conclusion, we hereby set aside the decision of the lower court holding that the transaction was a mortgage subject to the equity of redemption. We substitute it with the holding that the nature of the transaction was a contract of sale as intended by the parties. We further set aside the order by the court below -J.49- for the Registrar of Lands and Deeds to cancel the certificate of title issued in the appellant's name in respect of Stand No. 33023, Lusaka and restoring the same to the respondent. We uphold the order against the appellant to refund the sum of K72, 250.00 together with interest as awarded in the court below to the respondent. judgement. J. Chashi COURT OF APPEAL JUDGE F. M. Chishimba COURT OF APPEAL JUDGE ········· .. J·················· M. J. Siavwapa COURT OF APPEAL JUDGE