Chrispin Mushiba v Administrator General (2002/HP/A.0061) [2004] ZMHC 4 (4 November 2004)

IN THE HIGH COURT FOR ZAMBIA AT THE PRINCIPAL REGISTRY HOLDEN AT LUSAKA 2002/HP/A.0061 BETWEEN: CHRISPIN MUSHIBA PLAINTIFF AND THE ADMINISTRATOR GENERAL DEFENDANT FOR THE PLAINTIFF MS D. HATOONGO - SIMEZA, SANGWA & ASSOCIATES. FOR THE DEFENDANT MRS F. QUADRI - CHRISTOPHER, RUSSEL COOK&CO. JUDGEMENT ON APPEAL Legislation referred to: 1. Section 281 of the Companies Act, Cap 388 of the Laws of Zambia. This is an appeal against the decision of the learned Resident Magistrate, of 4h November 2002, whereby he summarily dismissed the Plaintiff's case. The decision was based on two grounds. One was that the action was statute barred, as it was instituted more than 6 years from the date it accrued. The other was that the action was commenced against a company under liquidation, without leave of the Court. The Contention in ground one is that the Learned Magistrate erred in law and fact when he held that there was no letter acknowledging the debt which could have revived the action. The letter the Plaintiff is relying on reads as follows: "ADGEN/101/1/ 19th September 2001 Messrs Simeza Sangwa & Associates Advocates LUSAKA. Dear Sir, RE: CHRISPIN MUSHIBA: LINTCO STAFF NO. 0531- UNDERPAVMENT OF REDUNDANCY PAY OF KlS,898,424.54 Your letter of oih September, 2001 and our subsequent meeting of 14th September, 2001 refer. Your Client's claims if proved and accepted, will be paid in accordance with the relevant laws. Yours faithfully, B. Chileshe ADMINISTRATOR-GENERAL (PROVISIONAL LIQUIDATOR) /rsk There was a reply thereto which reads as follows: Our Ref: SSNRMS/2001 20 November 2001 The Administrator General & Official Receiver Kambendekele House Dedan Kimathi Road LUSAKA Attention: Mr. B. Chileshe Dear Sir CHRISPIN MUSHIBA: LINTO STAFF NO. 0531: UNDER PAYMENT OF REDUNDANCY PAY OF KlS,898,424.54 We refer to the above and to your letter of the 19th September 2001 and now seek your urgent advise on whether our clients claim has been proved and accepted so that we can advise him thereon and take instructions. Yours faithfully Simeza, Sangwa & Associates On behalf of the Plaintiff, Mrs Hatoongo argued that the letter acknowledges the debt and hence under Section 25(5) of the Statute of Limitation Act 1939, revives the Claim. In response, on behalf of the Defendant, Mrs Quadri argued that the letter does not acknowledge or admit the debt because it states conditions of proof and acceptance of the debt. In my ·view the Defendant's letter of 19th September 2001 is non-committal. It is conditional. It does not amount to an acknowledgement or admission of the debt. This is confirmed by the Plaintiff's reply of 20th November 2001. The reply seeks confirmation of acceptance and acknowledgment of the debt. If the Defendant's letter of 19th September 2001 acknowledged the debt, then there would be no need to seek confirmation. Accordingly, I hold that the Plaintiff1s Claim is statute barred. Ground one of the appeal fails. On ground two, Mrs Hatoongo argued that it was a misdirection on the part of the learned Magistrate to hold that leave of the Court was required without making a finding as to whether the Defendant was liquidated by a Court Order or by voluntary liquidation. She referred to Section 281 of the Companies Act. In response, Mrs Quadri pointed out that the Appellant sued the Defendant in the name of the provisional Liquidator without leave of the Court. She argued that it was for the Plaintiff to enquire whether or not the Defendant was wound up by the Court. Section 281 of the Companies Act Cap 388, States: "When a winding up Order has been made or a provisional liquidator has been appointed, no action or proceedings shall be proceeded with or commenced against the Company except by Leave of the Court and subject to such terms as the Court may impose." In my view, the language of this Section is very plain. It needs to be interpreted in its literal sense that once a provisional liquidator is appointed, then Court action against the Company must not be commenced without prior leave of the Court. In my view, once the liquidator is appointed, it does not matter how he is appointed, leave for legal action must be obtained first. From the wording of the Section, it is clear that prior leave is mandatory. In the instant case, the provisional liquidator has been appointed. It is that provisional liquidator the Plaintiff sued without leave of the Court. I agree with Mrs Quadri that it was the duty of the Plaintiff to obtain leave before Court action. It is not for Learned Magistrate to grant him leave retrospectively. I find that the case was not properly before the Court. This ground too fails. The appeal is hereby dismissed with costs to the Defendant. These shall be agreed upon and in default be taxed. Delivered this 4 th day of November 2004 6