Chibote Farms Ltd v Buccaneer Products Ltd (Appeal 55 of 1993) [1993] ZMSC 80 (13 December 1993)

IN THE SUPREME COURT OF MU Appeal Heu 55 of 1S53 mO AT KUSAKA (Civil Jurisdiction) CHUOTE FARMS UNITED Appellant and •>. SUCCAHEER PRODUCTS LIMITS Respondent Cow: SaRaU» Chim and ^zyamba JJJ,S. ‘Jth wovaaber and Hr* Shawano SC of Shomwana and Company, for the appellant. Hr. M. K. MaKeto of Christopher, Russell Cook a Company, for the respondeat# JUD6HEHT Sakala J5O delivered the judgment of the court* Case referred to: Duly Motors (Zambia) Ltd and another V Livingstone Motor Assemblers Ltd (1) SCZ Judgment 172 of tW* This 1$ an appeal against a judgment of the High Court in which the High Court awarded the respondent damages equivalent to the total cost of procuring new or similar vehicles today, less the advance of K383.209 and the actual cost incurred by the appellant in duty sales tax and letter of credit establishment in securing the two vehicles Ln dispute. TM damages were to be assessed by the Deputy Registrar. For convenience we shall refer to the appellant as the defendant and to the respondent as the plaintiff which they were in the court below. The facts accepted by the learned trial judge were that the defendant company had entered into a contract of sale of meat products to a buyer In the Republic of Angola. Following upon that Contract the defendant company approached the plaintiff company, which was also a dealer in meat products, and requested it to supply the defendant company processed meat products to meet the order of the Contract for the buyer u Angola. According to the evidence which was also accepted by the learned trial Judge, the plaintiff company agreed to supply the processed meat products on terms that once the consignment had seen paid for by the buyer in Angola; the defendant company would make available to the plaintiff company a portion of the foreign exchange realised from the fifty percent rantetion scheme for the purchase of two specific motor vehicles and the plaintiff company would pay the kwacha cover for the said foreign exchange* It was coooh cause that sui^aeht to the agreement with the defendant company, orders were placed by the plaintiff company through Mobile Motors Zambia Limited to Toyota Motors Corporation of Tokyo, Japan for the purchase of two specific motor vehicles with specific accessories* On or around 12th June 1389, the defendant company entered into a Contract of Sale with the plaintiff company for the purchase of one Toyota LandcruHer Registration Ko. AAJ 5204 engine Mo«21G711 and one Toyota Hi lux Registration No, AAJ 5205 Engine NO. 2048081. The consideration for the said Contract was the amount in kwacha required to cover the portion of the foreign exchange promised by the defendant company to the plaintiff company. Subsequent to the Contract the defendant company raised letters of credit through Its bankers the Meridian Bank Zambia limited for the purchase of the said two motor vehicles ordered by the plaintiff company. The plaintiff company subsequently paid the sum of K383,209.90 being the kwacha cover required for the purchase of the said two Qotor vehicles which represented the plaintiff** share of the foreign exchange from the defendant’s Angolan Contract. Oue to foreign exchange fluctuations the defendant company informed the plaintiff company that the kwacha cover for the plaintiff’s share of the foreign exchange had risen to the sum of KM&.55&Q0. The plaintiff cwW agreed to pay the difference. According to the evidence the defendant company subsequently refused, failed or neglected to complete the Contract of Sale, Tte foregoing facts as already observed were not to dispute and were accepted by tte leaned trial judge as proved. Tte court found tort on the totality of the evidence before it, the plaintiff had proved on a balance of probabilities that ttm was a Contract between it and tte defendant company for the sale of meat products to the defendant corjw on condition that tte defendant caqpary would avail to the plaintiff conw toW-f Ive percent of the foreign exchange to be earned fir tte iapcrt of toe vehicles to dispute, Ito cart further accepted that upon toe arrival of the two vehicles to tte country, they were offered to tte plaintiff conpany rt« higher cost than that originally agreed. This, tte court found, was a asploto breach of contract on tte part of the tefsxfafit coipary. Ito court noted that tte plaintiff cawy prayed for specific perfawwe of the Contract with toe defendant; tot observed that specific perforate Is an equitable remedy grant®! at toe discretion of toe court and cited with approval toe words of .^‘garry and Baker; Snails Principles of acuity #to Edition at page 573 wtere toe learned author stated:- "Jurisdiction to specific perfcraano® IS based on to® inatotoarcy of tte renndy at law and to tt foilcws as & gsreral principle that equity will not interior ^tare damages at Ito will a party toe foil cawsaticn to which to is entitle and will put hto to a position as baneficlal to hto as if the agreaent had teen specifically performed," Tte lesmd trial toservod tort fooa tte facts of toe cose to® vehicles to dispute were received ty the dafendant enwv to January / February 1990 ttcre than two years ty toe tine toe ju^ent »as being delivered. Tte learrtad trial judge further noted that by that tine the vehicles cust nave depreciated conslder^Iy vterW to enter specific perferwee would o»an tte plaintiff oospany ending up tdto second tend vehicles. She fond that the nature of tte case was such that rte^ges would utec^tely ccrfpensate tte plaintiff co*w* Accordingly, she made an order that the defendant company should pay the plaintiff company damages $/* * * equivalent to the total cost of procuring new similar vehicles today, less advance and the actual cost incurred by the defendant company for duty sales tax and letters of credit estabMsh^t in securing the two vehicles* As already said these daoages were to be assessed by the Deputy Registrar* Costs were awarded to the plaintiff company* Fro® the three grounds of appeal as well as fro^ the appellant’s heads of argument; it is quite clear to us that the appellant's attack of the learned trial judge's judymnt is centred on the contention that the findings and the conclusions are not supported by the manner the plaintiff co®pany pleaded its cm* The endorsement on the writ of stmons reads as follows:* "The Plaintiff's CUia Is for the specific performance of a contract of sale for a Toyota Lend Cruiser and Toyota Ki 1UM made on or around Uth June, 138V and an injunction restraining the Qafendant whether by itself or it's agents fro® disposing of, tampering with or in any other way dealing or handling the said Water vehicles pending the deterainatiw of this action and other such relief as the court may grant and costs.* PAancuuas h TOYOTA LAHDCRUISER ^TOYOTA aiLUX 4X4 O/CAB REGISTRATION 80* AAJ.52G4 REGISTRATION HQ. AAJ 6205 M006U H. J. 75AP-KR CHASSIS $0. 00S7850 ®. 1216711 SWEU U 1OGR-Pm$ CHASSIS HO* 0022087 ENGINE HO. 2048081 Paragraph twelve of the statemat of claim reads as follows:* *The plaintiff therefore claims for specific S-Z***# * j-3. •* perfomance of a contract of sale of one Toyota Undcrulxer Registration Ro. AAJ52G4 aM Toyota Ml lux Registration ho* amszos to m plaintiff which contract was entered into in or about the 12th dune, AHO dosages for breach of contract AHO costs and Inure st at the ruling bank rate or' any damages which say be awarded by the court** And pragraph twelve of the defence reads as follows:* •The vehicles referred to in the statement of dais are ordinary goods of coerce and are of no special value and interest* Further or tn the alternative the Defendant will contend that specific porforaaaco is not the appropriate reaedy in that the vehicles of a sift liar type are readily available on the open market* In the premises the Defendant will contend that an order for the specif ic delivery of the said vehicles ought not to be wade.* •: F‘“- The defendant company*$ three grounds of appeal were that the learned trial judge erred in law in awarding to the plaintiff dmges equivalent to the total cost of procuring new or similar vehicles today when infect the plaintiff specif Rally prayed for specific parfomance to purchase specific vehicles with an injunction to restrain the defendant company from selling the specific vehicles; that the learned trial judge was wrong to award what she did in the absence of evidence to that fact; and that the learned trial judge exceeded her powers that although a discretion is given to the court* the court can only act; by the evidence before it. In arguing the first ground before us Hr* Shaiawm contended that the plaintiff having made a specific dd» for specific pErforeance for the sale of specific vehicles and having also endorsee the writ of suamons 6/... 06 * with 4 elate for an injunction it Mas a misdirection to award damages in Hau of specific performance* Mr. Sha^ana subaitted that where specific performance is claimed together with an injunction the plaintiff cwpany could not in addition seek damages because, according to hte, these elates are exclusive and in the present case the plaintiff cofspany asked for specif ^performance for a specific Ites, Mr* Shamwwa also contended that, even accepting for purposes of argwent that this was a proper case for specific performance, the learned trial judse misdirected herself by awarding damages equivalent to the purchase of new motor vehicles today basing the award on the authority of 3uly .motors (Zambia) L tel ted and another V* Livingstone mor assemblers Ltd (!) which was a case for a claim of loss of a motor vehicle and that what was in issue was to put the plaintiff in a position he would have been if the specific actor vehicle had not been lost, Ha further pointed out that the claim in that case was for damages and hot specific perferaam In the written heads of argument Hr. Shamwana pointed out that the claim for damages was not pleaded and no evidence was led to date damages In Heu of delivery of specific motor vehicles; submitting that the judge was bound to make the orders sought and could not refuse to make an order specif|c performance in the purported exercise of the courts discretions powers,, According to counsel the evidence in the present appeal showed that the plaintiff ordered specific vehicles and it was therefore proper that specific performance should have been ordered as the specifics made the vehicles to he with a special value. At thU juncture we take note that in the written heads of argument counsel had in the alternative, ^indicated that this was not a case where court could order specific performance because the motor vehicles in question were common items of merchandise with no rare qualities nor beaut: Mr, Shortwana concluded Ms arguments and submissions by informing the court that the arguments and submissions on the first ground also covered 7/< grounds two and three. 1ft his brief reply on behalf of the plaintiff company* Hr. Maketo submitted that specific perfomance being an equitable re^dy its ^plication is Halted by the fact of whether damages would be an adequate remedy In a particular case. According to HF* Haketo even though the plaintiff coapany^s claim was for specific notor vehicles* it was clear from the inception of the cast Wat the courts view was that damages would be an adequate remedy and for this reason the court did not grant the plaintiff caapany an Inurlm injunction it sought at the cowncerasnt of the action and only granted dazwges when the Plaintiff was successful at the eng of the action* Counsel farther submitted that the court having decided that damages were an adequate remedy in this particular case it correctly adopted the authority in the Puly Motors (Zambia) Limited (1) case by ordering that the defendant pay damages amounting to the present value of new similar vehicles* ft have very carefully examined the evidence on record and the judgment of the learned trial judge* ft have also considered the submissions by both learned counsel. We note that the plaintiff company*s claim as endorsed on the writ was for specific performance and an injunction* On the facts of this case we are satisfied that at that time the plaintiff company was perfectly entitled to endorse the writ as it did* The plaintiff cwpany had a contract of sale with the defendant company for specific and identifiable vehicles which had arrived in Zambia. The defendant colony refused* failed and neglected to deliver them* The appropriate action to take at that time, in our view* was for specific performance and an injunction* The question for damages for loss of the two vehicles at that time had not in our view arisen* The large part of Mr. Shamwana’s submission agrees with this conclusion* iM * * ’ Ts * The aajor complaint of ar, Skaswana seems to be that the plaintiff company having «ade specific claltas for specific performance and an Injunction the court was not entitled to make an order for damages as these were not pleaded for and for doing so* the court misdirected itself. This submission in pur view overlooked two important things, First* for reasons not on record the court daring the proceedings did not grant an order for an interim injunction although according to the proceedings an application was made. Mr. Maketo from the bar infomed the court that he was advised by the court not to proceed with the application for an interim injunction, Secondly paragraph twelve of the statement of claim (Supra) claimed for specific performance “and" damages. Mr. Snamwana, while conceding that in practice Outages are claimed as an alternative to specific perfomance he pointed out that In such event, they are exclusive and in the present case It was wrong to claim specific performance together with damages. In our view Hr* Shawwane’s argument would nave had force had the court in the first place granted an interior order thereby preserving the status qou of the two vehicles, This was not the case here* we are prepared to accept that given the nature of the items the subject of the dal®, the dale for damages was Ip the alternative* In his own submissions Mr, Snafirwana pointed out that the court was bound to grant the order for specific performance. Indeed the court was alive to this fact bat noted that at the tise of the Judgment. It was two years after the defendant company had taken possession of the vehicles. The court was therefore correct to say granting specific performance of the vehicles in question would have meant the plaintiff company ending tip with second hand vehicles. The court was also alive to the fact that specific performance was an equitable remedy granted at the discretion of the court and that its Jurisdiction is based on the inadequacy of the rawed/ at law* 97*** - J9 - The facts of the present case are, in my own view a clear example of flagrant cantuneiiciiyU disregard by the defendant company of toe plaintiff^ rights. In our view, at the Ursa of this cm, motor vehicles in Zambia could not have been said to have been common merchandise, It was therefore reasonable at that tiwe for the plaintiff company to stoic specific performance but twUthe judgsent cm too Uto, We agree with the trial Judge that toe nature of the case at that tia» was such that damages could adequately compensate the plaintiff company. We find no basis to disturb too lower courVs Judgaent, This appeal Is therefore dismissed with costs to be taxed in default of agrewnt. a, Mt********************* ♦»•*»♦, E*L. SakaU, SUPREME COURT JUDGE, a,K, Chirwa. SUPREME COURT JUDGE, MuzyaHba, SUPRESE COURT JUDGE,