Barlowoorld Plascon Z Ltd v G. M. International Limited and Anor (SCZ/8/254/2008) [2010] ZMSC 21 (23 April 2010)

IN THE SUPREME COURT OF ZAMBIA HOLDEN AT LUSAKA (CIVIL JURISDICTION) SCZ/8/254/2008 BETWEEN: BARLOWORLD PLASCON Z LTD APPLICANT AND G. M. INTERNATIONAL LIMITED KONKOLA COPPER MINES LTD 1ST RESPONDENT 2ND RESPONDENT CORAM: CHIRWA, CHITENGI AND SILOMBA, JJS On 20th May 2009 and 23rd April, 2010 r For the Applicant: Mr. C. CHONTA, Lewis Nathan Advocates For the 1st Respondent: N/P For the 2nd Respondent: Mrs. T. CHIRWA, MNB Legal Practitioners JUDGMENT SILOMBA, JS delivered the judgment of the Court. Cases Referred to:- 1. T. Wright and Son (Hull) Limited -VS- Westaby f 1972) 3 AER, 1078. 2. De Pass -Vs- The Capital and Industries Corporation Limited (1891) lQB, 216. 3. Collect -Vs- Van ZYL Brothers Limited (1966) ZRE 5. 4. Breza Engineering Limited -Vs- G. M. International Pie Copper Mines and Kon kola Limited SCZ/8/22/2008. When the Notice of Motion was heard, the Hon. Mr. Justice Peter CHITENGI was a member of the panel. The Honourable Judge has since retired from active service and this judgment will, therefore, be a majority judgment. The application of BARLOWORLD PLASCON (ZAMBIA) LMTD is by way of Notice of Motion pursuant to Order 48, r Rule 5 of the Supreme Court of Zambia Rules. In the Notice of Motion, the Applicant is seeking an order of the Court to grant it leave to appeal against an Order for costs granted by the High Court in favour of the garnishee herein which Order was upheld by a single Judge of this Court. The Notice of Motion is supported by an affidavit. The position at trial was that the Applicant took out an action against the 1st Respondent and subsequently obtained judgment against it. As Judgment Creditor (Applicant} it took out garnishee proceedings against the garnishee, Konkola Copper Mines Plc, to compel the garnishee to pay direct to the judgment creditor the money belonging to the 1st Respondent (Judgment Debtor) which the garnishee was allegedly holding to the credit of the Judgment Debtor. In the said proceedings, the Applicant sought an Order of garnishee nisi. Instead of hearing the application ex parte, the learned trial Judge ordered that the application be heard inter parles. At the inter partes hearing the application for an Order of decree nisi was refused and the Applicant was condemned in costs in favour of the garnishee. The Applicant sought leave to appeal against the decision to refuse to grant a decree nisi and the application was granted. However, an application by the Applicant to appeal against the Order for costs was refused. The Applicant then renewed its application for leave to appeal against the Order on costs before a single Judge of the Court but the application failed, hence this Motion. In his submission in support of the Motion, Mr. CHONTA, Counsel representing the Applicant, relied on the list of authorities he filed involving two cases of T. WRIGHT AND SON (HULL) LTD VS WESTOBY(1l and DE PASS VS THE CAPITAL AND INDUSTRIES CORPORATION LMTD.(2J He submitted, after alluding to the history of the case as outlined above, that this was a proper case for the Court to exercise its power under Rule 48(4) of the Supreme Court of Zambia Rules and reverse the decision of a single Judge. According to Mr. CHONTA, the general rule was to grant leave to appeal, unless the appeal had no prospects of success. He expressed optimism that his client has chances of succeeding against the trial court's decision to condemn his client in costs. After alluding to Section 24(d) of Cap 25, which restricts appeals against Orders on costs, Counsel argued that where a party had been granted leave to appeal, he could not be restricted in appealing against an Order of costs; that where the High Court had granted leave in one matter in chambers, it had no discretion to refuse an appeal in another matter relating to costs. As far as he was aware, the only restriction was when the appeal was on costs only. He submitted that the rationale was simple because a party who had accepted the ruling or award of the High Court had to show cause why he should contest the Order on costs. He contended that the learned trial Judge exercised the discretion to refuse leave to appeal on costs when he did not have such discretion. When asked whether the foregoing issues were argued before a single Judge, Mr. CHONTA conceded that they were not argued in the manner he had presented them before the Court. He invited us to reverse and vary the decision of a single Judge. With regard to the decision itself, Counsel submitted that the single Judge agreed with the learned trial Judge for two reasons. The first one was that the sum, the subject of I--.._ garnishee proceedings, was not ascertained. He cited Order 49, Rule 1 paragraph 20 of the Rules of the Supreme Court in aid. The rule states that 'the fact that the amount of the debt due or accruing due is not ascertained does not prevent a garnishee order nisi being made.' The second reason, according to Mr. CHONTA, was that the Applicant was not led into the proceedings by the Respondent. To contradict the single Judge, Mr. CHONTA referred us to the letter from the 1st Respondent now at page 12 of the record, in which the 1st Respondent informed Counsel for the Applicant that they were facing financial constraints because of the delay in receiving payments from their clients, Konkola Copper Mines. In the opinion of Counsel, the 1st Respondent was saying that the garnishee was indebted to it. Relying on the case of T. WRIGHT AND SON (HULL) LMTD VS WESTBY !1l in which SACHS W, among other things, said that the Applicant made an application in the belief that money was there, Mr. CHONTA said that the applicant in this case made an ex parte, application for garnishee order nisi because of the belief that money was owed to the 1st Respondent by the garnishee. As far as he was concerned, an affidavit swearing to the existence of a debt was enough to apply for garnishee proceedings nisi; that there was nothing wrong for the Court to attach debt and that issues of reconciliation were to be at the stage of garnishee absolute. He prayed the Court to reverse the Order of a single Judge. In response, Counsel for the garnishee relied on the written heads of argument and contended that the law was clear on the issue of costs following unsuccessful garnishee nisi proceedings. She referred us to Order 49 Rule 10 of the 1999 Edition and argued in the heads of argument that the r learned trial Judge and the single Judge of this Court were on firm ground in refusing the application for leave to appeal against an Order for costs. Although the explanatory note, to the Order stated that in a proper case costs might be awarded against the judgment debtor in unsuccessful garnishee proceedings, Counsel argued that that was not the ideal or usual situation as the discretion still remained with the Court to determined which case was a proper case in which to condemn the judgment debtor in costs. It was further argued, based on the above Order 49, Rule 10, that in these proceedings the Applicant was not led to the 2 nd Respondent (garnishee) by the judgment debtor (1 st Respondent). In the view of Counsel, the Applicant proceeded with the full facts of a plain case put to it by the judgment debtor of what would happen if the action against the garnishee went ahead and failed. Counsel submitted in the heads of argument that the Judgment Debtor indicated only that there was delay in payments by the garnishee and in turn the garnishee produced evidence in Court that in fact there was a dispute as r to how much was owed to the Judgment Debtor as it had breached the contract for services between the two but the Applicant (as Judgment Creditor} proceeded in the face of full knowledge of a bad case at its own risk. In the premises, it was contended that the learned trial Judge was on firm ground when he condemned the Applicant to pay the garnishee's costs. In her oral submission, Counsel reinforced what was contained in the heads of argument by relying on the case of COLLET VS VAN ZYL BROTHERS LMTD 131 in which it was held that the award of costs in an action was at the discretion of a trial Judge, to be exercised judicially; that where an appeal is made as to costs only, and is made without leave, the Court should entertain the application only if satisfied that the trial Judge did not exercise his discretion at all. We have duly considered the submissions of Counsel before us, as well as the proceedings before the learned single Judge of this court and those before the learned trial Judge. From the outset, we wish to say that a good part of the issues raised by the Applicant both in the oral submissions and heads of argument, are articulated in our judgment in the case of BREZA ENGINEERING LMTD VS G. M. INTERNATIONAL LMTD and KONKOLA COPPER MINES PLC,14l whose facts are on all fours with the current application. We say so because in that case, the Applicant, BREZA ENGINEERING LMTD relied on a letter of the 1st Respondent in this action that is similarly word ed as the letter at page 12 of the record of motion, to launch garnishee proceedings against the 2 nd r Respondent in this application. Like we said in the BREZA case, we have not seen the Notice of Appeal against the refusal by the learned trial Judge to grant a garnishee Order nisi. In the premises, we shall take it that the current position of the applicant is to appeal against the order of the lower Court to condemn the applicant in costs. We are also prompted to deal with the issue that once a trial Court has granted leave to appeal in the main matter it cannot, under the Supreme Court of Zambia Act, decline to grant leave to appeal against an Order condemning the Applicant in costs. As at now, we wish to deal with the issue whether or not the Applicant had grounds sufficient enough to commence garnishe proceedings against the 2 nd Respondent. Mr. CHONTA argued before the single Judge and before the Court that in terms of Order 49, Rule 1 paragraph 20 of the Rules of the Supreme Court and the authorities cited thereunder, the fact that the amount of the debt due or accruing due is not ascertained did not prevent a garnishee Order nisi being made. The foregoing argument, as contained in Order 49 aforesaid, was relied on in reference to a letter written by the 1st Respondent and found at page 12 of the record of Motion. This letter, as we have already pointed out, bears the format and content of the letter written by the 1st Respondent who is also the 1st Respondent in the BREZA case above. A reading of the two letters gives the impression that the letters were in standard form and what changed was the name of the Judgment Creditor at any given time. The argument under Order 49 aforesaid was also relied on to contradict the finding of the single Judge and the Court below that the Applicant was not led into the garnishee proceedings and that it had no justification in commencing the proceedings without ascertaining the amount the garnishee owed the 1st Respondent. Mr. CHONTA's view was that the letter at page 12 of the record of the motion was confirmation that money was owing in favour of the 1st Respondent by the garnishee, which was enough for the commencement of the garnishee proceedings. He urged us to reverse the single Judge and grant leave to appeal against the order for costs. Mrs. CHIRWA for the 2 nd Respondent, submitted that although in a proper case costs can, as provided in the explanatory notes to Order 49, be awarded against the Judgment Debtor, in an unsuccessful garnishee proceedings, the discretion still remained with the Court, in an ideal situation, to determine in which case a Judgment Creditor should be condemned in costs. As far as she was concerned, the Applicant cannot seek refuge in Order 49, Rule 10 because it was not led to the 2 nd Respondent by the 1st Respondent as Judgment Debtor. It ·was Mrs. CHIRWA's submission that the Applicant proceeded with the full facts of a plain case put to it by the 2nd Respondent of what would happen if it (Applicant) went ahead with the garnishee proceedings and failed. She amplified and said that the indication from the 1st Respondent was that there was delay in payments by the 2 nd Respondent. In turn the 2 nd Respondent indicated before the lower Court that there was a dispute as to how much was r owed t o the 1st Respondent as it had breached the contract, resulting in a Court case now pending in the lower Court. This evidence, including documentary evidence was according to Mrs. CHIRWA, spurned by the Applicant when it proceeded against the 2 nd Respondent in the full face and knowledge of a bad case. We have said earlier that this case is on all fours with the BREZA case. In that case and in dealing with Order 49 / 1 / 20 this is what we said:- "Mr. CHONTA and Mr. MUDENDA put much reliance on Order 49/1/20 and the case of DE PASS VS CAPITAL AND INDUSTRIES CORP which states that the fact the amount of the debt due or accndng due is not ascertained does not prevent a garnishee Order nisi being made. Mr. CHONTA even went further to talk about protecting the interests of the judgment debtor where there is money litigation between the Judgment debtor and the garnishee. However, after carefully reading Order 49/1/20 of the Supreme Court Rules and all cases cited therein, we are satisfied that in order to obtain a garnishee order nisi, it is not enough for the judgment creditor to merely tell the Court that the judgment debtor is awaiting payment from the 2 nd Respondent like was the case in this case. " We also referred to the case of HOTTBY VS HODGSON dealt under Order 49 / 1 / 20 in which LOPES LJ said that the test whether a debt is attachable is that there must be a debit which the judgment debtor can enforce payment if he desires r to do so. When it came to the letter that prompted garnishee proceedings, which is in the format of the one at page 12 of the record of Motion we said:- "When we read the letter on which the applicant relied to commence garnishee proceedings it is clear to us that the 1st Respondent was not suggesting that the garnishee owed it money which we can call an attachable debt and which the The fact that the 1st garnishee was refusing to pay. three Respondent prepared a payment schedule of instalments and asked the Applicant to appreciate their present position and accept their proposed revi.sed payment plan clearly puts it beyond doubt that it was not the intention of the 1st Respondent to tell the Applicant to get its money from the garnishee. Therefore contrary to the arguments of Mr. CHONTA and Mr. MUDENDA, the letter, the Applicant relied upon defeats the argument that the Applicant was led into the garnishee proceedings by the 1st Respondent. It is clear to us that the Applicant got into the garnishee proceedings because of being anxious and reckless and must bear the consequences." Indeed if they were anxious and reckless 1n the BREZA case, the position 1n this case 1s even worse because the Applicant was told that the money owing was disputed by the 2 nd Respondent and that the breach of contract by the 1st Respondent was a matter of Court proceedings. With this kind of evidence before the lower Court, we cannot fault the trial Court and the single Judge for refusing to grant leave because the Applicant took the risk to ignore valuable evidence at its disposal. As we wind up our judgment, we would like to deal with a matter raised by the Applicant at the very beginning of the submission by the Applicant's Counsel. The issue raised was that if a party is granted leave to appeal, he cannot be restricted in appealing against an Order for costs; that where the trial Court has granted leave in one matter in chambers it has no discretion to refuse an appeal in another matter relating to costs. As far as Counsel for the Appellant is aware, the only restriction is when the leave being sought is for an appeal against costs only. The foregoing submission is based on Section 24(d) of the Supreme Court of Zambia Act, Chapter 25 of the Laws. The Order for costs was made in a ruling of the 12th June, 2008 when an application for garnishee Order nisi was refused. The Order was made against the Applicant in favour of the 2nd Respondent as garnishee. The Ruling was made in chambers whereupon the Applicant made an application later for leave to appeal against the refusal to grant a garnishee Order nisi, as well as, leave to appeal against the Order for costs. At this stage, we think that the Applicant was not r smart enough when it split the applications. Had it applied for leave to appeal against the whole Ruling, it would, when framing grounds of appeal, have included one on costs as a separate ground of appeal. This, in our view would have been perfectly in order for the Appellate Court to deal with the ground. Having made two separate applications under one summons, the learned trial Judge was obliged to consider the two applications separately. He ended up in his Ruling of 26th September 2008, granting leave to appeal against refusal to grant a garnishee Order nisi and rejecting an application for leave to appeal against the Order for costs. It is submitted that once leave was granted in one matter, the learned trial Judge had no discretion to refuse the other application. On our part, we have visited Section 24(d) of the Supreme Court of Zambia Act and for the sake of clarity, this is what it provides:- "24(1) No appeal shall lie- (d) from an order of the High Court or any Judge thereof made with the consent of the parties or from an order as to costs only which by law is left to the discretion of the Court without the leave of the Court or of the Judge who made the Order or, if that has been refused, without the leave of the Judge of the Court." The law, as provided in Section 24{1)(d) above, is very clear: that you cannot appeal against an Order as to costs only as that is in the discretion of the Court. In the circumstances, the Applicant decided to seek leave of the lower Court to appeal against the Order for costs and there by exposed itself to the risk of having the application rejected for the reasons we have outlined in this judgment. The Applicant cannot be heard to say that the learned trial Judge, after having granted the application for leave to appeal against the refusal to grant garnishee Order nisi had r - no discretion to refuse the leave on costs. This is because the two applications, though under one summons, were separate and had to attract different considerations. The view we hold, therefore, is that the learned trial Judge and the learned single Judge of the Court had not lost the discretion in any way but properly exercised it in the circumstances of this case. From our reasoning, we do not find any merit 1n the Motion and it is dismissed with costs to the 2 nd Respondent to be borne by the Applicant. r D. K. Chirwa, SUPREME COURT JUDGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ♦ • P. Chitengi, SUPREME COURT JUDGE S. S. Silomba, SUPREME COURT JUDGE 17