Astro Holdings Limited and Ors v Edgar Hamuwele (Sued as Receiver of Courtyard Hotel Limited in Receivership) and Ors (Appeal No 213/2020) [2021] ZMCA 273 (12 July 2021)

IN THE COURT OF APPEAL OF ZAMBIA HOLDEN AT LUSAKA ( Civil Jurisdiction) AppealNo.2?12020 BETWEEN: ASTRO HOLDINGS LIMITED SANMUKH R. PATEL FURNITURE HOLDINGS T / A OFFICE WORLD RONAC SUPPLIES LIMITED 1 ST APPELLANT 2ND APPELLANT 3RD APPELLANT 4TH APPELLANT AND " EDGAR HAMUWELE (Sued as Receiver of Courtyard Hotel I Limited in Receivership) CHRISTOPHER MULENGA ( (Sued as Receiver of Courtyard Hotel \ Limited in Receivership) A YUB MULLA (sued as Borrower a ~ GAZELLE LIMITED (sued as Guarantor) - SKYWAYS TRUCK INN LIMITED ( Sued As Guarantor) ZABUNISSA ISMAIL (Sued as Guarantor) arantor) - - _.. · , 1 ST RESPONDENT 2liP\ RESPONDENT I / _3RD RESPONDENT 4TH RESPONDENT 5TH RESPONDENT 6TH RESPONDENT Coram: Mchenga, DJP, Mukungu and Ngulube JJA On the 19th day of January, 2021 and on the 12th day of July, 2021. For the Appellants: Mr. L. C. Zulu of Malambo & Co and Miss J. Mutemi of For the 1s t and 2 nd Respondents: Mr. L. Mwaamba of Simeza Sangwa and Theotis Mataka & Sampa Legal Practitioners For the 3 rd to 6th Respondents: Mr L. Kasali of Nkulukusa & Co Associates JUDGMENT MAKUNGU JA, delivered the Judgment of the Court. Case referred to: 1. Anderson Kambela Mazoka and Two others v. Levy Patrick Mwanawasa and two others (2005) ZR 138 2. Magic Carpet Travel and Tours v. Zambia Nati nal Commercial Bank Limited (1999) ZR 61 3. Setrec Steel & Wood Processing Limited and 2 others v. Zambia National Commercial Bank PLC - SCZ Appeal No. 39 of 2 007 4. The Attorney General v. Marcus Kampumba Act iume /1983) ZR. 1 . 5. Nkhata and four others v. The Attorney Genera f of Zambia ( 1966) ZR. 124 6. Sentor Motors Limited and 3 others (1998) S. J J SCZ Judgment No. 9 of 1996 7. The Minister of Home Affairs & The Attorney G neral v. Lee Habasonda suing on his own behalf and on behalf of the S them African Centre for the Constructive Resolution of Disputes - SCZ Jud ment No. 23 of 2007 8. Zambezi Portland Cement Limited and anot er v. Milota Transport Limited (Appeal No. 106/ 2017) 9. Hakainde Hichilema and Others v. Govemm nt of the Republic of Zambia - SCZ Appeal No. 28/ 2017 10. Khalid Mohamed v. The Attorney General (1981) Z. R. 49 11. Communications Authority of Zambia v. Vodat om Zambia Limited (2009) Z. R 12. Wilson Masauso Zulu v. Avondale Housing Pro ect Limited (1982) ZR 172 Legislation referred to 1. High Court Act, Chapter 27 of the Laws of Za bia 2. White Book 1999 Edition, Rules of the Supre / e Court Other authorities referred to: 1. Atkins Encyclopedia of Court forms zn Civi Proceedings, 2 nd edition, 2011 issued at Pl 145, para 3380 2. Halsbury 's Laws of England, 4 th Edition -J2- 1.0 INTRODUCTION 1.1 This appeal is against the Judg ent of the High Court delivered by Mr. Justice S. B . Nko dated 15th May, 2020. 2.0 BACKGROUND 2. 1 The brief background to this appe . is that on the 11 th of January, 2008 , an agreement was el tered into between the 1st appellant represented by the 2 n d al pellant on the one hand and the Courtyard Hotel Limited ( ow in receivership) which was represented by the 3 rd Respond nt on the other hand. The purpose of the agreement was for thJe 1st appellant to invest in the construction of Courtyard H tel in Livingstone. The agreed investment was in form of upply of various building materials , motor vehicles , furnit re , fixtures and fittings , construction equipment and cash a cdvances. I 2.2 The terms of the agreement were thl t the 1st and 2 nd appellant would , upon making the invest~ ents , be entitled to a minimum return of 1.7% per mont on all supplies of goods , services or investments done up tp date of repayment or an equivalent share at costs value of ttle investment. -J3- 2.3 It was also a term of the agreement t at if the investment was not repaid by 31 st December, 2010, e 1st and 2 nd appellants would be entitled to shares in the c mpany equivalent to the amounts due to them. 2.4 It was further agreed that Courty d Hotel Limited and its sister company would create legal ortgages over stand No. 5217, Ndola, Stand No. 363443, Lu aka and Subdivision B of stand 2869, Lusaka. 2.5 On 4 th December, 2008, the parti s entered into a further agreement for additional funding wi h a return on investment of 2% per month. 2. 6 It was further agreed that caveats would be placed on the pledged properties and that the 1st ppellant would be entitled to create further charges or legal m , rtgages over the following properties: 1. Stand No. 5217, Ndola; 2. Stand No. 36343, Lusaka; 3. Subdivision B of Stand No. 28 9, Livingstone; 4. Subdivision B of Farm No. 184 , Mazabuka; 5. Farm 377725, Ndola; 6. Lot 37736 /M, Solwezi; -J4- . ... t • 7. Stand No. 2610, Chambeshi; 8. Stand No. 2355, Kapiri Mposhi d · ' 9. Stand No. 2356, Kapiri Mposhi. 2. 7 The 3 rd , 4 th , 5 th , and 6 th responden s personally guaranteed Courtyard Astra Hotel Zambia Limiited's indebtedness with regard to the investment made. 2.8 By an originating summons and an affidavit in support, the appellants moved the High Court for he following reliefs: 1. Payment of all monies due u der equitable mortgages relating to the properties; 2 . Delivery up and possession oft ( properties; 3. Foreclosure on all the mortgage, properties; 4. An order for sale of the mortgaged properties; 5. An order that the respondel ts, Ayub Mulla, Gazelle Limited, Skyways Trucks In Limited, and Zabunissa Ismail being guarantors of th : Courtyard Hotel Zambia Limited, be ordered to honour ti eir guarantees in the event of the respondents failing to seTe in full its indebtedness. 6. Interest on all monies found due; 7. Further or other relief; 8. Costs. -JS- 2.8 In an affidavit in opposition, the r spondents' disputed the Appellants' claims on grounds that the 3 rd respondent had paid over and above the amount du to the appellants. This was after the appellants were rep 'd a total of USD6,500, 000.00. 2.9 That the said investors kept on requ1sting for new agreements to be signed whenever cash was bei g disbursed and they also kept increasing the number of secl rities required. That no invoices were issued for all the mat f rial collected from the 4 th respondent and that as such, the appellant was unable to ascertain how much was owed. Fu ther that contrary to the agreement to disburse USD12,000, ~00 within 18 months, only ZMW2, 604, 728.00 and USDl l , 320.00 was disbursed throughout that period. That the r spondents abandoned the project in December, 2011 due to financial constraints. The appellants therefore had to look for alternative sources of finance and managed to obtain bani loans. 2.10 It was later agreed between the p ties that all the securities would be released upon payment of USDS,000,000.00 as the whole loan would be considered f lly repaid. Therefore, upon payment of USD6,500,000.00 oni the securities relating to -J6- stand No. 2355 Kapiri Mposhi and 5203, Ndola were released and the 2 nd respondent claimed that the rest of the securities were lost. The 2 nd respondent later demanded an extra USD 9,000.000 for the delay in paying USD6,500,000.00 which the appellants refused to pay. 2.11 The respondents' filed a counter claim on 6 th May, 2014 for the following reliefs: 1. An order for the court to determine how much the respondents' owed the appellants' because no invoices had been issued and the respondents had no way of verifying how much was owed; 2 . An order that once the amount loaned to the respondent is determined, the amount of USD6,500,000.00 already paid must be deducted from the balance. 3. That all the securities be returned to the respondents as the debt has been paid in full; 4. Damages for breach of contract; 5. An order that the 3 rd and 4 th applicants issue invoices for all the materials supplied so that the company can claim VAT refunds; -J7- 6. Damages for loss of use of the 'respondent's investment licence to import goods, thereby de1 ying it the benefit of tax rebates. 2.12 By Consent Order executed on 13th November, 2014, it was ordered by the court below that proceedings would continue as if the same were commenced by waj of Writ of Summons. It was further agreed that the affidavits would serve as witness statements and the parties were at liberty to file additional affidavits and witness statements. 2.13 On 22nd September, 2015 the parII ies executed a Consent Order to the effect that they woul file witness statements which would be relied upon at trial i! lieu of affidavit evidence. However, in the witness statements he parties did not detract from their affidavit evidence. 3.0 LOWER COURT'S JUDGMENT 3.1 The lower court found the facts of r e matter stated above to be undisputed. The court further found that there were no I invoices and acknowledged deliv lry notes issued for the advanced monies and materials. After December, 2010 neither the 1st nor 2nd applicant became shr eholders in the company. -JS- 3.2 In or about May, 2012, the 3,d resj ondent through Messrs. Musa Dudhia and company p1 d the 1st applicant US$5,000,000.00 on the advanced m l nies and materials 3.3 There was an unsigned Acknowledge ent of Debt for the sum of USD9,000,000.00 as at 31 st Octa ,er, 2012 with respect to the Livingstone Courtyard Hotel Inve 3.4 The lower court identified the iss determination as follows: 1. Whether the applicants are claiming a relief which was not pleaded and if so, the consequei j ces if any. 2. Whether this action is a mortgag action and if so; 3. Whether the applicants' have pt oved that there is money owed by the respondents' on the mortgages and if so, the consequence if any. 4. Whether the applicants' are li ble to the respondents in damages for breach of contract. 5. Whether the respondents' hav . a valid counter - claim against the applicants. I I 3. 5 As regards the first issue, the learJ ed Judge found that the applicants in their evidence were c aiming USD9,294,387.00 as outstanding on the Investment A reements. This claim was -J9- " • II found to be outside the pleadings as the relief claimed by the applicants was for "payment of r e monies due under equitable mortgages relating to the prpperties." As a result, the judge found the claim under Investment Agreements to be outside his jurisdiction and totally m sconceived as parties are bound by their pleadings. 3.6 That upon pointing out that the applicant's action was anchored on Order 30 rule 14 of th:e High Court Rules and Order 88 of the Rules of the Supreime Court which relate to mortgage actions, the trial Judge foul d that it was a mortgage I action. 3.7 Regarding the issues of proof that th/ere are monies due under the equitable mortgages, the learned Judge found that according to Order 88 rule 5 (I) of the Rules of the . I Supreme Court and Atkins Encyclopedia of Court Forms in Civil Proceedings, 2 nd edition, 2011 issue at Pl 145, para 3380, in discharging their burde of proof, the applicants needed to furnish an account, in their pleadings, with particulars of, inter alia, the amoun~ advanced, the amount of interest on the claimed arrears at the commencement of the proceedings (including the of interest) and the -JlO- outstanding amounts under the m drtgage considering the witness statements relied on by the a plicants and, he found that no such account was rendered. 3.8 The lower court further found that the applicants failed to discharge their burden of proof. 3. 9 As for the counter claims issues 4 and 5, the court below found that they were bound to fail s there was no evidence led in support thereof. 3.10 Both the main case and counter c rums were dismissed for lack of merit and it was ordered tha t the parties should bear their own costs. 4.0 GROUNDS OF APPEAL 4 . 1 The appellants have advanced seven grounds of appeal framed as follows: 1. The learned trial Judge erred n law and in fact when he declined the appellants' claim for payment of USD9,294, 387. 00 as outstanding unde/ the investment agreement on the basis that the same w f s outside the pleadings as, the relief claimed was for ~ ayment of the monies due under equitable mortgages relhting to the properties. ' -Jll- .. 2. The learned trial Judge erred i[ law and fact, when he misapprehended the facts and contradicted himself in one breath by holding at page JSl of the Judgment that the claim for payment of the sum USD9,294,387. 00 arising from the investment agreements was outside the scope of the pleadings and the claim for elief was under equitable mortgages and subsequently in nother breath by holding at page J53 of the Judgmen that the action was a mortgage action when he stat .d that "it is my finding, therefore, that this is a mortga e action and no authority has been cited by the respond nts that the 2 nd applicant was incapable of being a mortg learned trial Judge err I in law and fact by 3. The misconstruing the import of the JJ?rovisions of Order 88 rule 5 (3) of the Rules of the Suprl me Court, 1965 edition, White Book to imply that the al pellants were required to furnish or render a statement of account in their evidence. 4. The court below erred in law a d fact when at page J58 of the Judgment, he disregarded the evidence relied upon by the appellants to show the state of account between the parties on the ground that d cuments were not dated, -J12- did not specify the currency amounts as well as the issuing entity when inf act, the said evidence tallied with amounts which were admitted by the respondents as having been advanced by the applicant. 5. The learned trial Judge erred in law and fact when at page J64 of the judgment, he held that the appellants "failed to show that the various requests for money were acted upon to the extent of the USD9,294,387.00 being claimed" when to the contrary, evidence demonstrated that fact. 6. The Judgment of the court below goes against the weight of evidence that was adduced before the court. 7. The Judgment by the court below falls short of the prescribed requirements to pass as a judgment. 5 .0 APPELLANTS' HEADS OF ARGUMENT 5. 1 The first and second grounds of appeal were argued together as they are related: The court was referred to the case of Anderson Kam be la Mazoka and Two others v. Levy Patrick Mwanawasa and two others, 111 in which the Supreme Court held inter alia that: -J13- "The function of pleadings is td give fair notice of the case which has to be met and to define the issue on which the court will have to adjudicate in order to determine the matters in dispuL between the parties. Once the pleadings have been [ losed, the parties are bound by their pleadings and the court has to take them as such." 5.2 Applying the aforesaid trite position of the law, it was submitted that the originating summons and witness statements and affidavits defined the issues to be ! etermined by the lower court. In paragraph 27 of the af davit in support of the originating summons (page 90 of t e Record of Appeal) the appellants' stated as follows: "That to date, the amount outstandi g from the 1st respondent is the kwacha equivalent of United States Dollars ten million, two hundred and eleven and ninet -three cents only (US$ 1 0, 211, 093 .00) which represents the figure of kwacha rebased fifty-five million, and thirty-seven, seven hundred and ninety- one and twenty-seven ngwee (KR 5 i , 037, 791. 27)." -J14- 5.3 In paragraph 13 of the affidavit in reply, which is contained at pages 158 to 163 of the Record of Appeal, the appellants' state as follows: "That it is not in dispute that the applicants availed the respondents various cash advances and materials towards the investment pledged as per the documentation signed (SPR lAfj) as alluded to above and that out of the total amount claimed in my affidavit in support at paragraph 27 being USDl0,211,093.00, only USS,000,000.00 has been received and I acknowledge this fact but not USD6,500, 000. 00 as claimed by the affidavit in opposition to originating summons and I produce and mark as exhibit 'SPRl' a true copy of a statement of account sent to the 2 nd respondent on the status of the debt outstanding as at 12/31/2008 showing the repayment of USD 5,000,000.00 only." 5.4 Exhibit 'SPRl' referred to under paragraph 13 above 1s contained at page 163 of the Record of Appeal. The bottom of the page, shows that the balance outstanding reduces to USD9,294,387.00 after the payment of USD5,000,000.00. The appellants subsequently filed a corrective affidavit -J15- which is contained at pages 275 to 278 of the Record of Appeal. Paragraphs 4 and 5 of the arne read as follows: "4. That the figure alluded to therein was an error in calculation and that the J' rue amount outstanding should now read USD9 294,387.00 as at 31 st December, 2012. This al ount continues to attract . "d interest so ong as t e samj remains unpaz . h I I . "5. That the corrected amour t now outstanding duly takes into account the pay finent of USDS, 000, 000. 00 mentioned in paragraph 11 of the affidavit in reply. Produced and shown to Je marked 'SPl' is a true copy of the statement t ecting how the figure arrived at USD9,294,387.0'0." 5 .5 Counsel therefore submitted that n l e claim for payment of USD9,294,387.00 under the Investment Agreement was not outside the pleadings, with the res, t that the finding of the trial court was not supported by ~vidence and is therefore perverse and should be upset. 5.6 It was further submitted that the far t that relief number one endorsed on the Originating Summons was for payment of all monies due under equitable mortgag s cannot by any stretch of -J16- imagination be construed as failing Jo plead a claim because the court could have reasonably infeJred from the evidence in the affidavit that; the monies dJ e under I the equitable mortgages was USD9,294,387.00; the jsame amount due under the Investment Agreement. Further, 1he facts pleaded were to be deduced from the body of the affidalit/ statement of claim as opposed to an endorsement. 5.7 An equitable mortgage has been descr bed in paragraph 405 of Volume 32 of Halsbury's Laws of J ngland, 4 th Edition as follows: I "An equitable mortgage is a conl ract which creates I a charge on the property but d bes not convey any legal estate or interest to thl creditor; such a charge amounts to an equi~able interest, its operation is that of executory cz1surance which, as between the parties, and so far r equitable rights I and remedies are concerned, is equivalent to an I actual assurance, and is enfo~ceable under the court's equitable jurisdiction." \ I 5.8 The nature of an equitable mortgage f as further described in the case of Magic Carpet Travel knd Tours v. Zambia -Jl 7- I •• National Commercial Bank Limited 121 where the Supreme Court held as follows : "The position at common law is that once a borrower has surrendered his title deed to the lender as security for the repayment of a loan, an equitable mortgage is thus created; the borrower in such a relationship cannot deal with the land without the knowledge and approval of the lender whose interest in the land takes precedence ... " 5 .9 Counsel cited the case of Setrec Steel & Wood Processing Limited and 2 others v. Zambia National Commercial Bank PLC, 131 where the Supreme Court of Zambia stated inter alia that: "In the National Westminster Bank case, Gibson, W proceeded to define a mortgage action. "He said that there were two possible constructions of the definition of a mortgage action in Order 88 Ru le 1. That the wider construction was that it embraced any action by a person who is in fact a mortgagee and claims in the action payment of moneys which in fact are secured by a mortgage, whether or not -J18- .. the mortgage is relied on. That the narrower construction was that it is an action by the plaintiff as a mortgagee in which action there is a claim for the payment of moneys secured by a mortgage in the sense that it must be claimed that the moneys are so secured. He held that the narrower construction was to be preferred as the proper definition of a mortgage action. We agree with Gibson LJ's definition of a mortgage action." 5.10 Applying the above authority, learned counsel for the appellant submitted that in the present case the appellant's were relying on the equitable mortgages to make their claim. The relief was endorsed in accordance with the specifications of both Order 30 rule 14 of the High Court Rules and Order 88 of the Rules of the Supreme Court (RSC). 5.11 Our attention was drawn to the lower court's finding at page J51 of the Judgment that the claim for USD9,294,387.00 was not pleaded. We were also referred to page J52 of the Judgment where the court held that the appellants' action was a mortgage one. Counsel contended that the trial Judge contradicted himself. It was contended that the Judge clearly made findings -J19- • based on a misapprehension of facts and that his findings ought to be set aside . Reliance was placed on the case of The Attorney General v. Marcus Kampumba Achiume. 141 5 . 12 The third ground of appeal was argued separately as follows: At page 71 of the record of appeal, the court held that the appellants needed to furnish an account in their pleadings with particulars of the amount advanced, the amount of interest on claimed arrears at the commencement of proceedings (including the rate of interest) and the outstanding amount under the mortgage. The court cited the provisions of Order 88 Rule 5 (3) of the White Book as authority for the said holding. According to counsel, the evidence of the state of account between the mortgagor and the mortgagee is only required where the court directs. Sub-rule 3 of rule 5 of Order 88 of the Rules of the Supreme Court, 1999 edition provides: "Where the plaintiff claims delivery of possession, the affidavit must show the circumstances under which the right to possession arises and except where the court in any case or class of case otherwise directs, the state of the account between -J20- .. . . the mortgagor and the mortgagee with particulars of: (a)The amount of the advance (b) The amount of the periodic payments required to be made; (c) The amount of any interest or instalments in arrears at the date of issue of the originating summons and at the date of the affidavit, and (d)The amount remaining due under the mortgage." 5.13 It was submitted that the court below did not give any directions for provision of the state of account between the parties in accordance with the aforesaid rules. Counsel contended therefore that it was erroneous for the court to rely on this rule in finding that the appellants had failed to discharge their burden of proof. 5. 14 Even assuming that the court below was justified in relying on the provisions of Order 88 Rule 5 of the RSC, the court erroneously stated that the witness statement filed by the appellants (see pages 659 to 688 of the Record of Appeal) did not show any account. To begin with, under paragraph 8, 9, -J21- 10, 11, 14, 21, 22, 23, 26, 28 of the witness statement, the amounts advanced were stated namely Kl,000, 092. 46, USD 492, 454, 77, USD 100, 000. 00, USD270,749.75, USD 100, 000. 00, USD 231, 522. 41, USD 2, 882, 032. 72 and USD 100, 000. 00 respectively. 5.15 With regard to interest, the court was referred to pages 659 to 697 of the record of appeal, paragraph 4(b) of the witness statement which reads: " .... The 1st applicant and its subsidiaries would invest in the Hotel project in Livingstone in the form of cash and goods with a return on the investment of 1. 7% percent per month agreed to." 5.16 In addition, paragraph 17 of the witness statement reads: "It was also a term of the further agreement aforementioned that the rate of return on the investment would be at the same minimum of 2. 0% per month." 5.17 Paragraph 25 of the appellant's witness statement reads: "In the said letter of 2 nd November, 2009, it was agreed that the rate of return on investments applicable would be set at 2. 5% per month. " -J22- .. 5.18 We were also referred to paragraphs 49 and 50 of the witness statement where the appellants gave evidence in chief as follows: "That from my computation of figures, the amount of United States Dollars Nine million, two hundred and ninety-! our thousand, three hundred and eighty-seven (USD9,294, 387.00) is due from the respondents and there is no justification for having not received these funds from them and as such, it is within the spirit of the agreement executed between the parties that securities be held until full settlement is achieved. The said due sum is as at December, 2012 and continues to attract interest until full and final payment." 5.19 The amount of the advance, the interest and amounts due were further stated in the affidavits in support of the appellants' case (see paragraph 4, 6, 7, 8, 11, 16, 17, 18, 19, 20). 5.20 The repayment period on the advances was stated in the Investment Agreement relied upon by the parties at pages 92 to 93 of the record of appeal and pages 102 to 103 of the record of appeal. The repayments were to be done by 31 s t December, 2010 under both agreements. -J23- 5.21 The court below at page 72 of the record of appeal, fortified its finding by reference to the evidence of PWl which it set out as follows: "PWl 's evidence was that despite the absence of invoices in respect of monies and materials and furniture supplied, the court would know the monies and materials supplied from the respondents' request for money and materials contained in the Bundle of Documents." 5.22 The court stated that the aforesaid was a strange position which was contrary to the requirements of the provisions of Order 88 of the Rules of the Supreme Court and the passage from Atkin's Encyclopedia in relation to mortgage claims for possession. It was submitted that the evidence of PWl was not strange because a statement of account showing all the monies advanced to the respondents was produced in evidence. With regards to the requests for money and materials which were contained in the Bundle of Documents, the same were not disputed by the respondents with the result that the court should have accepted the same as evidence of the respondent's indebtedness. -J24- 5.23 Based on the holding in the case of The Attorney General v. Marcus Kampumba Achiume 141 counsel reiterated that on a proper view of the evidence, no trial court acting correctly could reasonably have come to the conclusions and findings that the court below made. 5.24 In the alternative, it was argued that the provisions of Order 88 Rule 5(2) and (3) of the Rules of the Supreme Court are procedural rather than substantive as held in the case of Setrec Steel and Wood Processing Limited131 in which the Supreme Court held that: "The appellants should have raised the failure by the respondent to adhere to the procedural provisions at the beginning of the action. These procedural matters cannot be raised as a defence at the end of the trial." 5.25 In the matter at hand, the respondents opted not to ra.1se a procedural objection regarding the purported failure to adhere to the procedural provisions. Counsel therefore contended that it was not within the purview of the learned trial Judge to raise the issue after trial. 5.26 In support of the fourth ground of appeal, it was argued that the court below erred in law and fact when at page J58 of the -J25- Judgment, it disregarded the evidence relied upon by the appellants to show the state of the account between the parties on the ground that the documents were not dated, did not specify the currency as well as the issuing entity when in fact, the said evidence tallied with amounts which were admitted by the respondents as having been advanced by the applicant. 5.27 Counsel pointed out that at page 57 of the Judgment, the trial Judge stated as follows: "I must here mention that I am alive to the fact that PWl in his evidence appeared to place much reliance on the document at page 29 of the applicants' Bundle of Documents as the requisite statement of account in this action. I have carefully perused the document, it is not dated, does not specify the currency of the amounts, which entity issued it, the interest rate applied on some of the amounts, the basis of the 30% interest rate compounded monthly on some of the amounts and does not show the outstanding amount when these proceedings were commenced in 2014. It was argued that the document did not come anywhere near the required particulars under Order 88 of the Rules of the Supreme Court. I find that it cannot be relied on to determine the dispute in this action." -J26- 5.28 Counsel further referred us to page 64 of the Judgment, where the court below stated as follows: "As regards the document at page 1 of the applicant's Bundle of Documents, it is my view that in the absence of the evidence of the maker of the document, Mr. Gupta and the invoices and delivery notes to support the figures therein and the 3 rd respondent having denied the signature on the document as his, the document cannot be relied on as evidence to prove the USD 9, 294, 387. 00 indebtedness even as at the date stated on the document. PWl 's evidence in relation to this document also amounts to hearsay." 5.29 It was argued that the aforesaid shows that the court below was insistent that invoices and delivery notes be produced by the appellants as evidence of the debt. However, it was submitted as they did in the court below, that it was not necessary for the 1st appellant to issue invoices for materials and furniture supplied. RW4 confirmed in cross examination, that the transaction between the parties was an investment transaction and not a sales transaction with the result that there was no need for invoices in order to reclaim value added tax. -J27- 5.30 Contrary to the finding by the trial Judge that, the statement at page 348 of the Record of Appeal showing the state of account between the parties was undated, it did state the period 1s t March, 2008 to 31 st December, 2008 and 31 st December, 2009 (see lines 4 and 5 at page 348 of the Record of Appeal). 5.31 In addition, the date on which the 2 nd respondent appended his signature was indicated. This document was not objected to by the respondents with the result that the court below erred in disregarding the same. The record of proceedings will show that even though the denominations of the amounts were not indicated, the 3 rd respondent in cross examination was able to confirm the amounts which were indicated on the document. Further, even if the name of issuing entity was not stated, the issuing entity was decipherable from the document itself as the 1st appellant. 5.32 According to ground five, it was argued that the learned trial Judge erred in law and in fact when at page 64 of the Judgment, he held that the appellants "failed to show that the various requests for money were acted upon to the extent of the -J28- USD 9, 294, 387.00 being claimed." We were referred to page 64 of the Judgment were the lower court stated this: "It would also seem to me that the applicant would want the court to accept various requests made by the 1st and 3 rd respondents as proof that USD9,294,387. 00 was advanced and is due. But a request remains a request until it can be shown that it was positively acted upon, and in this matter, by the applicants. The applicants instead have failed to show that the various requests were acted upon to the extent of the USD9,294, 387.00 being claimed." 5.33 The appellants' counsel submitted that was made in disregard of the letter at pages 53 7 - 538 of the record which reveals that the 1st respondent continued to request for financial assistance from the 1st appellant. In fact, in the first and last paragraphs of the letter, the 3 rd respondent stated as follows: "I am writing for further assistance to complete construction of our Livingstone Hotel and Shopping Mall by December, 2009 ... I have endorsed a rough list of time tables of materials that will require importing from China and South Africa ..... . -J29- I sincerely hope that your group will continue to support us as you have always done. I thank you in anticipation." 5.34 Counsel contented that the letter indicates that the appellants had previously provided the 1st respondent with assistance. The nature of the assistance is to be discerned from the said letter which was materials and cash of USD 100,000.00 per month. 5 .35 The aforesaid position was said to be further evident from the letter at pages 540 to 541 of the record of appeal in which the 1st respondent at page 541 indicated that it had a plan to pay back its loan to the 1s t appellant through a diversely hedged investment. The 1st respondent requested for additional funding of USDl00, 000.00 in September, 2009 and an additional USD 200, 000.00 in October, 2009 . 5. 36 In the letter at page 548 of the record of appeal the 1st respondent wrote to the 1s t appellant urging them to reconsider their decision to stop funding the construction of the Livingstone Hotel and Shopping Centre. 5.37 It was further evident from the cross examination of RW2 that the 1st respondent continued to make repeated requests for funding from the 1st appellant despite the alleged frustrations -J30- as well as the decision to seek the aid of other financers. It was submitted that this behavior was strange for a person who was allegedly not receiving funding in the past. Further, when shown the letters authored by the 2 nd applicant at pages 537 to 538 of the record of appeal and pages 540 to 541 of the record of appeal, RW2 confirmed to the court that there was no reference in the said letters to money not received by the 1st respondent. 5.38 Counsel contended that the dismissal of the appellants' action was therefore tantamount to unjustly enriching the respondents. 5.39 Ground six is that the Judgment of the court below goes against the weight of evidence that was adduced before the court. The appellants' counsel submitted that the record shows that it was not in dispute that as at 11 th January, 2008, the 1st and 2 nd respondents confirmed that the sums of USD492, 454. 77 and USO 13,320.00 excluding value added tax were outstanding to the 4 th appellant for geysers, which amount was to be paid by the end of February, 2008 and attracted interest at 2% per month (see pages 289 - 290 of the Record of Appeal). This was admitted by RW2 in cross examination. -J31- 5.40 In addition, the respondents' first witness, (RW 1) admitted to receiving USD400,000.00 as well as furniture valued at USD55, 689. 78 from the 4 th appellant but pretended not to know the amounts and the sequence. We were referred to the evidence at page 348 of the Record of Appeal that as at 30th November, 2008, the respondents had received the sum of USD 1, 076,524.32 and that this was the total amount outstanding as at 30th November, 2008 (see 10 entries under heading total). 5. 41 The record of proceedings further shows that when RW2 was referred to the documents at pages 349 to 359 of the record of appeal, he confirmed the credit of the following sums to the 1st respondent, ZMW216,000 on 30th July, 2011, the sum of ZMW264,000, ZMW360,000 the sum of ZMW150,000 on 13th August, 2010. RW2 further confirmed receiving the sum of USD45,000.00, ZMW264,000 on 30th July, 2011, ZMW360, 000.00 on 1st September, 2010, USD 75,000.00 in September, 2010. The cumulative sums of ZMWl,134, 000 and USD 120,000 were admitted by RW2. 5.42 The appellants' counsel further submitted that for purposes of ascertaining the amounts due to the appellants, the court should have examined the account statement at pages 348 of -J32- the record of appeal. The document at page 348 of the record of appeal shows that as at 30th August, 201 O, the 1st and 2nd respondents acknowledged indebtedness to the appellants in the sum of USD8,596,220 by executing the account statement. 5.43 To show this court that the amounts endorsed on the said statement were indeed received by the 1st and 2nd respondents, we were referred to the record of appeal, to indicate a correlation between the amounts endorsed on the account statement and with those on the documents executed by the respondents through RW2. 5.44 Firstly, with regards to the document at page 289 of the record of appeal, RW2 confirmed and further admitted in cross examination to owing the sums of USD492,454.77 and USD13 , 320 .00 as at 1st January, 2008. The amounts aforesaid tally with the first two entries at page 348 of the Record of Appeal. 5.45 Secondly, counsel submitted that looking at the letter at page 296 of the record of appeal, it is clear that on 20th January, 2009, the 1st respondent requested for an additional sums of USDl00,000 in January and February, 2009. On comparing the amount aforesaid with the entry on 23rd January, 2009 at page 348 of the record of appeal, which was three days after the -J33- 1st respondent's letter, the court will note that the entry is for the sum of USDlOO, 000.00. 5.46 RW2 confirmed being indebted to the applicants in the sum of USD 1,225, 243. 00 which amount tallies with that at page 348 of the record of appeal under line 10. 5.47 Moreover, RW2 in cross examination, admitted to having received the sum of USD200,000 on 21 st May, 2008 which amount tallies with the entry on 1st May, 2008 at page 348 of the applicants' Supplementary Bundle of documents. RW2 further admitted to receiving furniture in the amounts endorsed on the statement at page 348 of the record of appeal. 5.48 The appellants' counsel went on to submit that it was RW2's uncontroverted evidence as per paragraph 39 of his witness statement (see page 658 of the record of appeal) that the total amount outstanding from the respondents was USD9 ,249, 387.00 as at 20 th May, 2012 after taking into account amounts paid by the respondents. The court below was referred to the statement at page 311 of the record of appeal, which shows a corresponding amount at the bottom of the document. The said statement further shows payment of USD2,200,000 and USD -J34- 2,000,000 on 1st January, 2012 1n arnv1ng at the amount outstanding. 5.49 The appellants' evidence in cross examination was that the amount of USD9,294, 387.00 was arrived at after factoring in the sum of USD4,200,000 paid by the 1st respondent. 5.50 It was submitted that an interesting fact that this court ought to note is that although throughout the trial, the respondents' disputed their indebtedness to the appellants, in their counter claim on page 151 of the record of appeal, they requested the lower court to determine how much they owed the appellants, which would not have been the case, if they were truly not indebted to the appellants. 5.51 Counsel argued that the alleged anomalies in the statement at page 348 of the record of appeal were matters to which the court below should not have attached weight. According to counsel, the court below equally failed to consider the evidence adumbrated above and therefore its findings should be set aside. Reliance was placed on the case of Nkhata and four others v. The Attorney General of Zambia 151 where the Supreme Court held as follows: -J35- "A trial Judge sitting alone without a jury can only be reversed on questions of fact if (1) the Judge erred in accepting evidence, or (2) the Judge erred in assessing and evaluating the evidence by taking into account some matter which he should have ignored or failing to take into account something which he should have considered, or (3) the Judge did not take proper advantage of having seen and heard the witnesses, (4) where it is demonstrated that the Judge erred in assessing manner and demeanor of witnesses." 5.52 Further submissions on behalf of the appellants were that it is clear that the court below did not adjudicate on every aspect of the case that was in dispute. Further, in accordance with its powers under Section 13 of the High Court Rules, Chapter 27 of the Laws of Zambia and the decision in Sentor Motors Limited and 3 others 161 if the court was of the view that the evidence of the respondent's indebtedness was not clear, the court should have either referred the parties to the Deputy Registrar for assessment of the amounts outstanding or given Judgment for the admitted amounts as opposed to dismissing the case and unjustly enriching the respondents. -J36- 5.53 In support of ground seven that "the Judgment by the court below falls short of the prescribed requirements to pass as a Judgment," Counsel heavily relied on the Supreme Court case of The Minister of Home Affairs & The Attorney General v. Lee Habasonda suing on his own behalf and on behalf of the Southern African Centre for the Constructive Resolution of Disputes 171 where it was held inter alia that: "Every Judgment must reveal a review of the evidence, where applicable, a summary of the arguments and submissions, if made, findings of fact, the reasoning of the court on the facts and the application of the law and authorities if any, to the facts." 5.54 Counsel for the appellant stated that the court below considered evidence which it should not have and, disregarded evidence which it should have considered. According to counsel, the Judgment is devoid of reasoning and the lower court made an unbalanced evaluation of the evidence . The prayer therefore was that the same be set aside and the matter be referred back to the High Court for re-trial before a different Judge. -J37- 6.0 18 T AND 2ND RESPONDENTS HEADS OF ARGUMENT 6.1 The 1st and 2 nd respondent's arguments were filed on 15th January, 2021. The nub thereof is as follows: In dealing with the question whether the applicants now appellants were claiming a relief which was not pleaded and if so, the consequence if any, the lower court ref erred to the case of Mundia v. Sentor Motors 161 for the principle that parties are bound by their pleadings and found inter alia as follows: "In this case, on the totality of the evidence presented by the applicants, it is clear that the applicants endeavoured to show that the applicant has a valid claim for USD9,294,387. 00 as outstanding amount on the investment agreements made between the 1st applicant represented by the 2nd applicant and the 1st respondent represented by the 3 rd respondent. Part of the evidence in chief of PWl was that all securities being held were to secure monies still outstanding and due from the respondents which monies have not been repaid and are due at the return agreed expressly by the parties." "I find this claim to be outside the pleadings as the relief claimed by the applicants is for "payment of monies due -J38- under the equitable mortgage." In any event, even if the impugned claim was within the pleadings, I am precluded by the law to give a relief which was not claimed and the impugned claim falls within that category." 6.2 Learned counsel for the respondent submitted that payment of the sum of USD9,294,387.00 was prayed for under the equitable mortgages and not under the Investment Agreement. The evidence and submissions however showed that the appellants were claiming payment of this sum under the Investment Agreement. The question therefore was whether the lower court could award the sum of USD9,294.387.00 as due and payable under the Investment Agreement albeit the fact that there was no prayer to that effect. The court held and rightly so that it had no jurisdiction to do so. 6. 3 We were referred to the case of Zambezi Portland Cement and Another v. Miloto Transport Limited 18l where we decided a similar question as follows: "The cases Kutalika v. Kalunga, Sheik Kaayum & Others v. Alihhai and Others, which Mr. Sangwa SC referred to can be distinguished from the circumstances of this case. In all those cases, the -J39- court granted either an injunction or writ of mandamus, reliefs which a court cannot grant in the exercise of its own discretion. The court can only grant the reliefs if it is moved by the parties and the parties are heard." 6.4 We were also referred to the recent case of Hakainde Hichilema and Others v. Government of the Republic of Zambia 191 where the Supreme Court restated its position that a court cannot award a relief not prayed for. 6.5 Counsel went on to argue ground 3 as follows: The gist of the appellants' arguments under this ground is that under Order 88 Rule 5 (3) of the Rules of the Supreme Court of England an applicant is only required to furnish evidence of the state of account between the mortgagor and the mortgagee if the court so directs. The issue raised under ground 3 goes to the lower court's finding that the appellants have failed to prove their case. It was submitted that the appellants have misapprehended the provisions of Order 88 Rule 5 (3) Rules of the Supreme Court. 6.6 Additionally, counsel submitted that what the appellant prayed for was payment of monies due under the equitable mortgages. -J40- To succeed on this claim, the appellants needed to prove the following: 1. Existence of the equitable mortgages; 2. How much money was due under the mortgages; 3. Rate of interest if any; and 4. The amount of periodic payments to be made. 6. 7 Counsel contended that the entire action ought to have revolved around the equitable mortgages. The appellants' ought to have complied with Order 88 of the Rules of the Supreme Court both in their pleadings and evidence but this was not the case. A perusal of the evidence led by the appellants and the submissions filed clearly shows that they recast their case at trial. The appellants completely abandoned their claim that the debt arose under the equitable mortgages and instead endeavoured to show that the money arose under the Investment Agreement. 6.8 The appellants only made mention of the pledges of properties a few times in their pleadings and evidence. By way of example at paragraph 15 of the affidavit filed 1n support of the originating summons appearing at page 87 of the record of appeal, the applicants stated that:- -J41- " pursuant to the said further agreement, the following additional properties were pledged as security: a) SID of Farm 1847 Mazabuka b) Farm no. 37725/M, Ndola c) Lot 37736/ M Solwezi d) Stand 2610, Chambeshi e) Stand 2355, Kapiri Mposhi j) g) 6.9 There was also another mention of the pledge of the properties under paragraph 24 of that affidavit and nothing more. The rest of the contents were a discussion of the Investment Agreement and how much was due and payable under that agreement. 6.10 From their own evidence, the applicants were not interested in enforcing the securities (the alleged equitable mortgages). What they wanted was payment of money under the Investment Agreement. This can be gleaned from paragraph 49 of the applicants' first witness statement which states that: ... from my computation of figures, the amount of United States Dollars nine million, two hundred and ninety-four thousand, three -J42- hundred and eighty-seven is due from the respondents and there is no justification for having not received these funds from them and as such, it is within the spirit of the agreement executed between the parties that securities be held until full settlement is achieved." 6.11 The lower court cannot therefore be faulted for holding as it did. It was submitted that in fact, the reason why the appellants abandoned their case and sought to prove a case not pleaded was because there were no equitable mortgages created between the applicants and Courtyard Hotel Limited as what was signed in this case was an Investment Agreement whose effect was that the appellants particularly the first appellant was going to invest in Courtyard Hotel Limited. It is important to understand that at that time the investment had not yet been made. 6. 12 The parties then agreed that Courtyard Hotel would pledge certain properties as security and this 1s where it gets interesting because the clause on security 1n the Investment Agreement provides that: "Mr. Ayub Mulla will pledge the following assets as securities on which a caveat will be registered. Astra Holding -J43- Limited will be entitled to create any further charge and legal mortgages as and when deemed necessary for the investment and return." 6.13 It follows therefore that no equitable mortgages were ever created on the properties either in fact or law and the appellants are not holding onto the titles to these properties. 6.14 If indeed equitable mortgages existed, the appellants ought to have led evidence of the Certificate of Title in their possession and the amount of money due under each mortgage. 6.15 Upon referring us to the case of Khalid Mohamed v. The Attorney General, 1101 counsel submitted that there was no nexus between the remedies the appellants sought in the court below (remedies relating to a mortgage action) and the evidence led at trial. The court below therefore correctly dismissed the appellants' case for improper pleading and lack of proof. 6.16 Additionally, that it is important to mention that should the court agree with the position taken under ground 1, then the appeal herein ought to be dismissed in its entirety since grounds 1 and 2 have an effect on the other grounds which in fact appear to be subsidiary. -J44- 6.17 It was therefore submitted that the 1s t and 2nd grounds of appeal ought to fail because they are premised on a misapprehension of the lower court's Judgment. 6.18 According to the appellants' counsel's understanding of Order 88; a statement of account should be filed unless the court directs the parties not to file. The lower court therefore correctly construed Order 88. The rationale obviously is to help the court when deciding the amount due. It is therefore a matter of evidence. 6.19 Counsel went on to state that the appellants have in the alternative submitted that they did in fact provide a statement of account. He submitted that this is however factually incorrect because a review of the record will show that no statement of account containing the requisite information as set out under Order 88 was ever presented. 6.20 What the appellants are relying on is not a statement of account. They are relying upon haphazard paragraphs from the witness statements and surprisingly, the Investment Agreement to justify their argument that a statement was provided. 6.21 The lower court upon reviewing the evidence on record, made a finding that there was no such account. The appellants have -J45- lamentably failed to establish any of the preconditions for overturning a finding of fact. To buttress this, reliance was placed on the case of Communications Authority of Zambia v. Vodacom Zambia Limited.1 111 6.22 The burden was on the appellants to prove the amount owed. There was need for documentary evidence to prove the case. 6.23 It was further submitted that the Setrec Steel 131 case is not applicable to this matter and does not in any way affect the judgment of the lower court. The issue raised in the Setrec case was procedural vis that the action was not a mortgage action because material particulars were not provided and the Supreme Court held that since the issue was procedural, it should have been raised before trial. The situation in this case is different. The lower court did not raise the issue of the statement and particulars as a procedural issue but as a substantive issue vis a matter of evidence and discharging the burden of proof. 6.24 Counsel proceeded to argue grounds 4 to 6, and submitted that the appellants have attempted to assail findings of fact. We were referred to a number of authorities on the legal principles governing the setting aside of findings of fact by an appellate -J46- court, including Attorney General v. Achiume and Nkhata and others 141 which are to the effect that: "The appeal court will not reverse findings of fact made by a trial Judge unless it is satisfied that the findings in question were either perverse or made in the absence of any relevant evidence or upon a misapprehension of the facts or that they were findings which, on a proper view of the evidence, no trial court acting correctly can reasonably make." 6.25 The respondents' counsel stated that under ground 4, the appellants have taken issue with the reasons given by the lower court for rejecting the purported statement of account at page 311 of the record of appeal. The appellants' argument is that there was no need for delivery notes and further that the statement was dated. The reasons advanced by the appellants as the basis upon which they are seeking to assail this particular finding fall way below the standard required to assail a finding of fact. 6.26 What the appellants produced were statements which did not make any sense at all and were contrary to the agreement between the parties. Starting with the statement at page 311 of -J47- the record of appeal; as correctly observed by the lower court, it was not dated and neither does it name the author. Secondly, it does not show the 1. 75 return agreed upon by the parties. To make matters worse, the statement shows an interest rate of 30% compounded monthly which was not agreed upon. 6.27 The appellants have also argued that this document was not objected to and therefore the lower court erred in disregarding it. Counsel contended that the duty of the court is to analyse the evidence presented by the parties and not to merely accept what has been presented. 6 .28 There is even more reason why the statement was rejected by the lower court and rightly so. It is difficult to fathom that the appellants delivered goods worth millions of dollars without any record whatsoever. 6.29 There was also no record of the alleged money transfers as the alleged statement is not corroborated. The bottom line is that the appellants failed to lead any cogent evidence to prove their claims. The issues under ground 4 therefore have no merit. 6.30 It was contended that the appellants' requests for further assistance do not at all prove that money was actually disbursed. What the appellants were required to do was to lead -J48- evidence to prove that they acted on the requests. RWl both in his examination in chief and cross examination emphatically denied that the requests were acted upon. 6.31 It was submitted further that in a feeble attempt to substantiate their claim, that the requests were acted upon, the appellants produced certain cheques and bank transfer records. These are appearing at pages 341 to 349 of the record of appeal and the summary thereof is as follows: ~mount disbursed [I'otal Amount ($) [I'otal Amount (K) K 216 , 000 K 264, ooo K 360, 000 USO 150, 000 lJSO 150 , 000 USO 45 , 000 USO 45 , 000 (does not show that the transfer was to Courtyard Hotel) K264 , 000 (does not show courtyard Hotel as recipient of alleged transfer and a mere duplication of transaction a t page 2 K264 , 000 but is a m ere duplication of the transaction at page 7 as both were done on 30.07 . 11 K360 , 000 which is duplicated at page 10 and a m ere duplication of the transaction at page 2 K75, 000 which lS duplicated at page 12 lS USD420,000 ~840,000 6.32 The total sum of money advanced barely exceeds K2 million. Interestingly, this is the sum of money the 3 rd respondent said was actually received from the appellants. No other evidence -J49- has been led to prove that the respondent disbursed more money than what is tabulated above. 6.33 It must be appreciated that the 3 rd respondent did obtain some sort of funding from the appellants to the tune of just over K2 million Kwacha and he admitted this in paragraph 9 of the affidavit in opposition appearing at page 124 of the record of appeal which reads: "That in response to paragraph's 6, 7, and 8 of the applicant's affidavit, the only amount due and owing to the applicants is Kl,000,092.46 plus Kl,604, 718.92 and US$ 13, 320 the total owing to the applicants is K2, 604, 728 and USD 13,320 which has been repaid." 6.34 Counsel for the respondents reiterated that the statements of account cannot be relied upon because of the various anomalies: Firstly, the statements do not show the transactions of K216,000.00, K264,000.00 and K360 ,000.00 tabulated above. Also, the statement does not show the sum of USD75,000.00 and USD45,000 tabulated above. There was no proof that the 3 rd respondent signed the statements relied upon. 6.35 The appellants' further argument is that some of the amounts that were requested for are appearing on the statements and -JSO- they have endeavoured to cross-reference the amounts requested with what is appearing on the statement. In response, it was contended that the mere fact that the amounts requested appears on a dubious statement prepared by the appellants themselves with no date and no indication of the issuer does not prove that the money was disbursed. More was required to prove disbursement of the money. 6.36 The court was therefore on firm ground when it held that the appellants had failed to prove their claim. 6.37 The appellants have argued that the respondents were asking the court to determine how much they owed the appellants which would not have been the case if they were not indebted. Against this argument, counsel submitted that the appellants have not appreciated that the respondents admitted owing the sum of about K2 million and what they were asking the court to do was to declare that, that was the only sum owing so that the remainder of what was paid to the applicants would be repaid to the mortgagors. 6.38 Further submissions on behalf of the respondents were as follows: The allegation that the lower court failed to give reasons for rejecting the appellants' evidence is totally unfounded as the -J51- lower court gave cogent reasons for its holdings. The appellants themselves have reproduced excerpts from the lower court's judgment where reasons were given and have endeavoured to water down the same. 6.39 As for the proposition by the appellants that the lower court should have ordered for an assessment of the outstanding debt, the respondents' counsel submitted that a plaintiff must prove his case with cogent evidence and if he fails to do so, his claim should be dismissed. There is no law or procedure to the effect that if there is no clear evidence, then the matter should be referred to assessment. The allegation that the court failed to adjudicate on all aspects of the case is equally unfounded. Counsel ultimately prayed that grounds one to six be dismissed for lack of merit. 6.40 In assailing the seventh ground of appeal, the respondents ' counsel reiterated the judgment of the court below clearly shows that the lower court made specific findings of fact and gave reasons for its findings and decision. The Judgment met the requirements prescribed by law. 6.41 The respondents' counsel finally submitted that all the grounds of appeal are devoid of merit, which renders the entire appeal -J52- • hopeless. The appeal therefore should be dismissed 1n its entirety with costs to the 1st and 2nd appellants. 7.0 OUR DECISION 7. 1 We have carefully considered the record of appeal and the arguments made by counsel for all parties concerned. We shall tackle the 1st and 2 nd grounds of appeal together and grounds 3 to 6 together as they are related. Ground 7 will be addressed separately. GROUNDS 1 and 2 7 .2 The matter was dealt with as though it was commenced by writ of summons and not strictly as a matter of mortgage. The dispute arose from an investment agreement, therefore the appellants' claims could not be detached from the said agreement. Our understanding of the pleadings is that the appellants claimed that the "equitable mortgages" arose from the investment agreement. We therefore agree with the appellants that the trial Judge contradicted himself when he found that the claim for USD9,294.387.00 was outside the pleadings as the relief sought by the applicants was for "payment of monies due under the equitable mortgage." -J53- 7 .3 However, we note that according to the pleadings, the appellants claimed the sum of US 1 10,211.093.00 and not USD9,294,387.00 and as such, they were supposed to prove their claim and not to alter it. 7.4 The prime question is whether the a r ion can be described as a mortgage one. In determining this question, we have in mind the definition of a mortgage a J ion in the case of Setrec Steel and Wood Processing Li, ited and 2 others v. Zambia National Commercial Ban, PLC13l supra. Looking at the narrow construction of the I efinition of a mortgage action" vv e are of the view that this is a mortgage action as the appellant claimed monie . secured by equitable mortgages and the respondents' J their evidence admitted that they had pledged several pro erties as security for the expected debt of USD12 ,000 ,000.00. They expected the appellants to release all the securities held upon paying the sum of USD6,500,000.00 but only f he Title Deeds relating to stand No . 2355 Kapiri Mposhi a n d stand No. 5203, Ndola were released as the appellant clj med that the rest of the securities were lost. This is in ac ordance with the affidavit in opposition sworn by the 3 rd resp ,ndent, Ayub Mulla. -J54- 7 .5 In fact, the agreement between the parties dated 11 th January, 2008 at page 92 of the re lord of appeal describes several Certificates of Title for variou properties which were pledged. The board resolution on page 101 of the record also refers to title deeds for stand 2869I Livingstone where the I hotel was to be built and offered as security for the appellants' investment therein. Para~raph 18 (vii) of the 2 nd respondents' witness statement tal~ s about the appellants' having held on to the securities after abandoning the project. Furthermore, there was a counter laim for the return of securities. For this reason, we reject the respondents' counsel's submission that there wa1 no indication that Title Deeds for the properties pledged as slcurity were handed over to the appellants. 7.6 We therefore reject the respondents' 1ounsel's submission that no equitable mortgages were created and hold that they were, because the Title Deeds were handed over to the appellants. 7. 7 For the foregoing reasons, we find merit in the 1st and 2 nd grounds of appeal. -J55- • GROUNDS 3-6 7.8 Our interpretation of Order 88 Rule 5 (3) of the White Book, quoted at paragraph 5.13 herein is ti at in a mortgage action where the plaintiff claims delivery of ossession, the affidavit in support should indicate the circum tances under which the right to possession arose; the state of he account between the mortgagor and mortgagee with particulars of the amount advanced, the amount of the periodic payments required to be made, the amount of interest (if any), instalments in arrears at the date of issue of the originating su mans and at the date of the affidavit, and the outstanding ebt under the mortgage. Only if the court allows or directs t I e plaintiff not to include such information in the affidavit in support can an affidavit without the stated facts suffice. 7.9 The case of Setrec Steel and WooL Processing Limited131 is authority that order 88 rules (2) / d (3) set out procedural matters which should be raised er ly in the action and not as a defence at the end of the triail. We note that according to Order 2 Rule 2 of the White B+ k the respondents herein waived their right to raise the prt cedural issues when they failed to raise them before filing t ~ eir defence or simply early -Js6- I • • I r in the action. They did not even rai e it at any time during the proceedings in the court below The lower court was therefore not at liberty to raise that ssue on its own motion after trial. The finding in relation to Order 88 were the ref ore erroneous and are hereby set aside. 7.10 We note that, the appellants en eavored to render an account and the lower court's judgL ent was predicated on the evidence on record which was i ven appropriate weight and some of which was rejected for jh st cause. 7.11 Contrary to the submissions by the appellants' counsel, it is clear from the judgment of the lower court at pages J57 - J58 that the evidence by the appellant' as to the state of the account between the parties was d·smissed on the grounds that the lower court had fully con idered the statement of account now at page 311 of the re I ord and found that it is not dated, does not specify the curr ncy of the amounts, does not show which entity issued it and does not state the interest rate applied on some of thl amounts. Further, that the basis of the 30% interest rate l ompounded monthly on some of the amounts was not given and, the outstanding -J57- ... Ii , I amount when the proceedings were commenced in 2014 was not stated. 7.12 Upon scrutinizing that statement, e take the view that the lower court was on firm ground whe it rejected it for the given reasons. We therefore will not interfi -re with the said findings. It is clear to us that the parties n er agreed on compound interest at 30%. The interest rates agreed upon were in the range of 1. 7% - 2. 5% and our und erstanding is that it was simple interest. 7.13 We note that the respondents admi ted amounts much lower than the amount claimed and proL d that the said amount was paid in full. The lower court had fully considered the evidence of the witnesses on both sides and found that the appellants had failed to prove t at the USD9,294,387.00 claimed was advanced in form of c · sh and material was due for payment. See pages J58 - J66 f the Judgment appealed against. 7 .14 At pages J56 to J57, the lower court referred to PW l's evidence that "in the absence of in j oices in respect of monies and materials and furniture suppl'ed, the court would know the monies and materials supplied rom respondents' requests I -J58- r ' for money and materials contai ed in the bundle of documents." The court rightly fo Ind this evidence to be insufficient as it was contrary to the requirements of order 88 of the White Book. We have alre dy stated that order 88 should not have been relied upon the court. However, we finding to that extent. 7.15 We must state that in any case, a r quest for payment is not tantamount to proof of payment and thus there was no proof that the respondents' were given all the monies and materials which they had requested for. 7.16 The respondents' advocates have c]ted various anomalies in the accounts rendered by the appl llants which we will not restate because it is clear to us tht the appellants failed to prove their claims. There was no in1 cation as to how much of the debt was secured by each of the properties pledged as securi1y. This also weakened the ap~ellants' case. 7.17 According to the case of Wilson Mf auso Zulu v. Avondale Housing Project Limited 112i the pl, ntiff has to prove his case and it matters not what can be said about the defendants' case. So, the respondents' having equested for a verification -J59- L' • I of how much was owed is of no consequence to their defence. In any case, it is clear that the counterclaim was made with a view of getting a refund. 7.18 The respondents' counterclaim for the return of all the securities should have been granted as the appellants' case was dismissed. 7.19 We therefore reverse the lower court's judgment to the extent that the said claim is hereby granted and we order that all the securities be returned to the respondents. GROUND 7 7 .20 Having perused the judgment appealed against, we are of the view that it is in accordance with the requirements prescribed in the case of Minister of Home Affairs and Attorney General v. Lee Habasanda.171 This ground therefore lacks merit and is accordingly dismissed. 8.0 CONCLUSION 8.1 All in all, in the lower court, the appellants' failed to prove their case on the balance of probabilities. The 1st and 2 nd grounds of appeal have partially succeeded. The 3 rd ground as framed fails. The lower court erroneously raised the procedural -J60- issue provided for under Order 88 of the White Book in the judgment as it was not raised by the respondents' earlier during trial. The 4 th to 7 th grounds of appeal are bereft of merit and dismissed. The appellants' are hereby ordered to hand back all the title deeds held as security to the respondents' forthwith. The appeal has substantially failed and it is dismissed with costs, which may be taxed if not agreed upon. C. F . R. MC ...... ~, ... -.. A DEPUTY JUDGE PRESIDENT C. K. MAKUNGU P. C. M. NGULUBE COURT OF APPEAL JUDGE COURT OF APPEAL JUDGE -J61-