Kachingwe v Stock Brockers Malawi Ltd (Civil Cause 501 of 2007) [2018] MWHC 1248 (17 April 2018)

THE REPUBLIC OF MALAWI IN THE HIGH COURT OF MALAWI LILONGWE DISTRICT REGISTRY CIVIL CAUSE NO.501 OF 2007 BETWEEN AND Bartholomew Kachingwe Stock Brockers Malawi Ltd Plaintiff Defendant CORAM: Madalitso Khoswe Chimwaza, Assistant Registrar B. Kachingwe W. Kaluba, Mpandaguta Plaintiffnot represented Counselfor the Defendant Court Clerk ORDER ON ASSESSMENT OF EXPENSES & COSTS This is the ruling of the court on the rehearing of assessment of expenses incurred by the plaintiff in a suit against Stock Brokers Ltd, claiming wrongful sale of his shares, Brief Facts In the Judgment of Justice Mzikamanda, dated 21% September 2012 the plaintiff was partially successful and was awarded K13,796.68 damages, 70% ofexpenses incurred and 25% of costs to be assessed by the Registrar. In the ruling ofthe Senior Deputy Registrar dated 22"4 August 2013 for assessment of expenses, he observed and found that the plaintiff was supposed to specifically prove the expenses which he had incurred in demanding his shares back. He was supposed to produce receipts or other supporting documents. That the court had no jurisdiction to award interest as the same was not awarded by the Judge in the judgment dated September2012. ThereforeasumofK 00,000 was awarded as expenses incurred. The plaintiff was not satisfied with the award and he appealed to the High Court. On appeal upon looking at the matter Justice Chombo ordered the assessment of expenses to be reviewed by the Registrar as the plaintiff was claiming that he had evidence to support the claim for expenses. When the matter was set down before the Senior Deputy Registrar, the plaintiff decided to bring new evidence which was not available at the initial assessment. In view of that the SDR ordered that the matter should proceed by way of rehearing so that the defendant can be given a chance to cross examine on the new evidence. On the date for rehearing the defendant did not attend court and consequently the SDR decided to recuse himself from the case since he had become too familiar with the issue and he had already formed an opinion on the matter, he therefore ordered that matter should come before another Registrar, hence the hearing on 17" October,2017. In his evidence the plaintiff said the receipts that he was relying upon for the assessment were not before court during the initial assessment of expenses where the SDR awarded him K100,000.00. He said he brought the receipts when the matter was going on appeal before Justice Chombo. He said the total claim of expenses at the time the SDR made the award of K100,000 was K31,599,829.00. He said this figure was arrived at after taking into account the inflation rates and interest. He said by the time matter was being heard on appeal by Justice Chombo the figure had risen to K55,113.778.00 taking into account inflation rate. In his submissions dated 18" December 2017, the plaintiff summarized that he was claiming 70% of the expenses K55,113,778.00 which translates to K38,579,645.00 Since this was like a rehearing as new evidence was being advanced Counsel for defendant had opportunity to cross examine the plaintiff. In response to whether paragraph 9 the statement of claim dated 21/5/2007 was correct, the plaintiff answered in the affirmative. For the avoidance of doubt, this paragraph states that: 9. The plaintiff claims: (a) Dividend on 500 shares from 1999 to 2006 for Stanbic Bank (b) Dividens on 200 shares from 1999 to 2007 for Old Mutual Ple ( c compensation on expenses incurred by the plaintiff when requesting for the Certificates and loss of business (d) aggravated damages for inconvenience and embarrassment (e ) Any other order that the court may deem fit And the plaintiff claims for costs of this action 10. When cross examined, the plaintiff said the Judgment of Justice Mzikamanda did not state that the awarded expenses should take into account interest or inflation rate. He also conceded that in the statement of claim he did not include a claim for interest but he decided on his own to raise the issue during the hearing before Judge R. Mzikamanda because the matter had taken too long, but the Judge did not award him. He admitted to have been awarded K13,763,68 as bonus that he was not receiving from 1999 to 2012 when his share certificates were misplaced. He said he had spent over K55,113,778.00 expenses in the process of collecting K13,763,68 . He admitted to have filed the bundle of receipts on 2/10/2013 after the Senior Deputy Registrar had already made his assessment of expenses. He further said the receipts covers the whole period of the proceedings from tracing the share certificates, mediation, court hearing and assessment. He said the expenses are not limited to expenses for recovering share certificates only. He also admitted that he was the author of all the receipts that he had tendered as evidence, but he does not haveany transportation business, restaurant or accommodation business. He said he did this since he could not get receipts from the service providers because they do not provide receipts. He said he decided to calculate his expenses taking into account inflation rate after the judgment of Justice Mzikamanda but this was not ordered in the judgement of the court neither was it pleaded in the statement of claim. Issue for Determination e Whether the plaintiff has any legal basis for claiming expenses with interest in the absence of specific pleadings. Amendment of pleadings In the absence of court order. e e The Law and Reasoned Analysis of Facts and Law Practice and Procedure on Pleadings Pursuant to Order 18 of the RSC, it is a cardinal rule of practice and procedure that a plaintiff must specifically plead in his statement of claim special damages and that the plaintiff will not be allowed at the trial to give evidence of any special damage which is not claimed explicitly, either in his pleadings or particulars. PN 18/12/32 RSC. See also Hayward vs Pullinger and Partners Ltd [1950] 11 All ER 581. In the case of Registered Trustees of African international Church vs Registered Trustees of African Church [1954] MLR 271, Justice Unyolo (as he was then) held that: dn the course ofthe trial, the plaintiffalso sought to claim the sum ofK2,500.00 being the value of bricks and iron sheets belonging to the plaintiff and allegedly misappropriated by the defendant. This is clearly a claimfor special damages. By rules ofpleadings and procedure such damages must be specifically pleaded and proved. In therefore the claim cannot this case the plaintiff pleaded general damages only, succeed, Ina more recent case of Kamlepo Kalua vs Attorney General [2013] MLR, in which among other claims, the appellant appealed against the decision of the Assistant Registrar in not to Zomba during the 2009 awarding him general expenses for travelling from Rumphi elections. The appellant claimed that the Assistant Registrar should have awarded him the K5,000,000.00 expenses as claimed since the defendant had not challenged the witnesses statement and skeleton argument during assessment of damages which followed the issue of liability being settled by a default J judgment. The High Court held that although the claim for general expenses of K5,000,000.00 was part of the default judgment recorded for the plaintiff, the claim being a special damage ought to have been strictly proved by the plaintiff. The Assistant Registrar in refusing to award the expenses stated; Sadly no relevant evidence was adduced to support this claim. No fuel receipts, no bus lickeis, no accommodation receipts Jor example were exhibited to show that indeed at the material time the plaintiff travelled between the two towns and how much was expended, neither did he summon a witness to support his story." Justice Chirwa on appeal held that assessment of damages being part of the trial of the action, the burden reposed on a party who asserts the affirmative to prove the assertion continues to apply to the assessment of the damages. The ground of appeal was dismissed as being without merit. In the present case the plaintiff pleaded expenses in his pleadings and indeed the Judgement of Justice Mzikamanda awarded him 70% of the expenses incurred. However these being special damages, they ought to have been strictly proved by the plaintiff. The plaintiff in support of his claim for expenses tendered Exhibits which were filed on 2/10/13 marked as exhibit BK23 recordings of trips and dates travelled; Exhibit BK24 recordings of expenses per month and year; exhibit 25 Reserve Bank of Malawi interest rates and inflation; exhibit 26 total amounts for trips expenses plus interest and inflation claimable. The plaintiff admitted in his testimony that he did not produce the receipts for purposes of assessment before the Senior Deputy Registrar, but he exhibited before Justice Chombo on appeal. He admitted to be the one who wrote the receipts and that it is true they did not come from the service providers. He admitted that he did not own a vehicle, a rest house or restaurant that could have justified his issuing of receipts for such service. This court is presented with manufactured evidence which the plaintiff created in order to support his claim for expenses. This is confirmed by the receipts which were generated from one receipt book on diverse dates from 2009 to 2013. A good example are receipts dated 16/4/2012, but were issued for transport expenses, lunch, breakfast, supper and accommodation from one book. On 16" April 2012 the following receipt numbers were issued: No. 122 for K700 for transport fare; No. 123 for accommodation at K3,000; No. 124 for {500.00 for lunch; No. 126 for K500.00 for transport ; No. 127 for K 800 for transport to Blantyre; No. 128 for K 400 breakfast and receipt No. 133 for K600, just to mention a few. All these receipts were issued by the plaintiff and yet the service was provided by different individuals and service providers. He did not summon any witness to support his claims of the figures on the receipts. This court feels unsafe to rely on such type of evidence as it would mean encouraging parties to be creating or cooking up evidence in order to convince the court. Therefore the receipts will be disregarded. This however does not mean that the plaintiff did not incur any expenses at all. The fact that the receipts were manufactured does not mean that the expenses were not incurred and because of that the court will proceed to consider basing on the number of trips actually made and recorded and not disputed by the defendants that they were made. The court further noted that the applicant is claiming subsistence allowance for each trip he was making in addition to the expenses. See exhibit BK28 numbered 1-9, Last column An allowance is a contractual payment where parties have entered into a working relationship on contractual terms. This being a court case, the court does not have any evidence that there was any agreement between the applicant and the defendants that he would be paid subsistence allowance when coming to court to prosecute his case. Therefore this is not a legitimate expense, When calculating expenses this part will not be included. Is Interest Payable in this case The plaintiff in his statement of claim did not plead that interest should be paid on the sum he In making the determination of the substantive matter Justice was Claiming or the expenses. Mzikamanda did not award the plaintiffany interest on the sum that was being claimed or the expenses. It is a cardinal principle of law that where a party is claiming special damages as the plaintiff is doing now, such claim must be specifically pleaded and it must be specifically proved with evidence. See Order 18, Rule 8 of the Rules of the Supreme Court. In the case of Simiyoni v Kanyatula [1999] MLR 382 (MSC) the court held that the statement in particular, must show of claim must give sufficient particulars of the contract relied on, and, (i) the date from which interest is payable, (ii) the rate of interest fixed by the contract, (iii) the amount of interest due at the issue of the writ. In the present case all this was not pleaded in the statement of claim by the plaintiff and according to the rules of practice and procedure, the court is not mandated to grant a claim that was not pleaded by a party. A party will not be allowed to adduce evidence on a claim that was . PN 18/12/32 RSC. See also Hayward vs Pullinger and Partners Ltd [1950] iI not pleaded. AIL ER 581. This court is quite mindful of the fact that every judgment in civil proceedings shall carry interest at the rate of 5% per annum or such other rate as may be prescribed. In granting this the Court exercises its discretion under the law which provides that statutory interest rate, the High Court shall have jurisdiction to direct without prejudice to any other written law, if at all the expenses that the court interest to be paid on debts. This court is having doubts, awarded to the plaintiff could be categorized as debts to warrant a statutory interest rate of 5% as provided under section! 1 of the Courts Act or any other interest rate. In the absence of pleadings for interest, or court order to that effect, this court does not find inflationary rate on the expenses that were any legal justification for claiming interest at awarded. Further in the absence of credible evidence to support the claim for expenses, this court finds that the plaintiff has failed to prove the claim for expenses incurred. The receipts that the plaintiff exhibited as proof for the expenses incurred are not credible therefore they are disregarded and therefore the claim for K55,113,773.00 has failed for lack of merit. In any event it does not make economic sense to spend that much for a claim ofK13,763.68. However the court is mindful of the fact that some reasonable expenses were incurred and as such the plaintiff is entitled to 70% of that as he was awarded by the Judge in his judgment as reasonable expenses. In the circumstances the court proceeds to assess the said reasonable expenses minus, at inflationary rate, minus subsistence allowance and for this reason the court will not use exhibit 26 as tendered since the figures indicated therein took into account subsistence allowance which the court has already found that it is not payable. interest The court will base its calculations on the recorded trips made as per exhibit BK 28 minus the last column for subsistence allowance as follows: Total Luench and K1,340.00 Year 2000 2002 2004 2006 2008 2010 2012 Total Number of trips 4 trips 7 trips 1 8trips 4trips 4trips Strips 16trips 39trips 17trips 26trips 26trips LOtrips 1 Strips 19trips 12trips Expenditure: breakfast, Transport,B/fast. supper TpT, B/fastand lunch Tpt,B/fast, Lunché& supper Tpt,B/fast, Lunch Tpt, B/fast,Lunch Tpt,B/fast, lunch Tpt, B/fast.lunch Tpt,B/fast, lunch Tpt,B/fast, Lunch accomo,supper Tpt,B/fast,Lunch Tpt,B/fast, Lunch,supper accomo Tpt,B/fast. lunch, supper accomo Tpt,B/fast/lunch,supper &accomo Tpt,b/. fast/lunch,supper,& accomo Tpt,b/fast/lunch,supper& accolmo K6,720.00 K 14,700.00 K3,520.00 K3,520.00 K4,400.00 K18,670.00 K50,990.00 K29,240.00 K34, 160.00 & K46,950.00 & K15,800.00 K42,900.00 K81,400.00 K54,500,00 K408,810.00 Therefore the 70% of expenses that the applicant was awarded by the court according to these calculation will be : 70% of K408,810= K286,167.00. Since he was already awarded K100,000 by His Hon Kishindo as expenses the balance payable is K168,167.00. As for costs the plaintiff did not provide any substantive evidence as to how much was spent in prosecuting this action therefore this court will assess the 25% costs of the action as ordered by the Court which could have been awarded to counsel if the matter had been handled by legal Counsel. In this case matter went to trial and looking at the volume of documents that were exhibited by plaintiff in prosecuting the case, the period it has taken and the value of the Kwacha along the years, this court is of the view that if the plaintiff was being represented by legal Counsel he could have been claiming costs of not less than 63,500,000, before taxing and around K1,500,000 after taxing. According to Order 31 rule 15(1) of the CPR which regulates costs for a party acting in person ,it gives the court power to exercise its discretion and form an opinion as to what could have been allowed as costs if a lawyer was involved in the matter provided that it should not exceed two thirds of the sum. Since the plaintiff was not being represented by counsel the court awarded him 25% as costs and this will form the basis for calculation, 25% of K3,500,000 =K875,600. ORDER For the reasons already stated in' this assessment order the plaintiff is awarded a sum of K268,167.00 as expenses at 70% of expenses incurred, less K100,000 already assessed by His Hon. Kishindo the balance payable is 16168,167.00. As regards costs the court has assessed them at 16875,000.00. The total payable is K1, 043,167. To be paid within 21days from date of order. Either party has the right to review of this decision. Made this day of (0x Madalitso Khoswe Chimwaza (Mrs) ASSISTANT REGISTRAR