Investisseur IV Holdiings BV and Anor v Vanessa Marian Parker and Anor (2024/HPC/0151) [2024] ZMHC 169 (15 April 2024)

IN THE HIGH COURT FOR ZAMBIA AT TH E COMMERCIAL DIVISION HOLDEN AT LUSAKA (Civil Juris diction) BETWEEN : 15 APR 2024 2024/HPC/0151 INVESTISSEUR IV HOLDING BV PETR US HUBERTUS CAROLUS JOSEPHUS VAN DOOR NE FIRST PLAINTIFF SECOND PLAINTIFF AND VANESSA MARIAN PARKER PETE R MUTALE KANG'OMBE (Su ed in his capacity as receiver of Tongabezi Lim ited (In Receivership)) FIRST DEFENDANT SECOND DEFENDANT Before the Honourable Mr Justice K. Chenda on 15th April 2024, in Chambers For the Plaint iffs For th e First Defendant For th e Secon d Defendant : Mr M. Chibwe of Ilunga and Compa ny ✓ : Mr M. Cha nda and Mrs L. Mwenda of Musa Dudhia & Company : N / A EX-TEMPORE RULING On Application for an Interim Injunction I have LISTENED ATTENTIVELY to the arguments and CLOSELY STUDIED the documents on record. After a CAREFUL CONSIDERATION, my decision is as follows. 1.1 The entire injunction application turns on one key contention of what will best serve the interests of justice whilst the battle for control of the debtor company rages on in the substantive matter before Court. 1.2 The learned authors of Goode and Gullifer on Legal Problems of Credit and Security (6 th Edition (2017), London: Sweet & Maxwell at p.197, para. 5-37) posit as follows on the discourse of priorities of securities and their implication on enforcement by a secured creditor: "Effect of priorities on enforcement by a secured creditor If mortgages are granted in succession to SP 1 and SP2 and there are no factors to displace SP 1 's priority, he may realise his security, take what is due to him and then account for any surplus to SP2, who will in turn deduct what is due to him and hand over any remaining surplus to three or more incumbrancers it would seem that SP 1 's duty is to hand over the whole of any surplus to SP2, leaving it to him to take what is due to him and pass any balance to SP3, rather than SP 1 being responsible for distribution among all interested parties in order of priority. the mortgagor. Where there are However, it is not only the senior mortgagee who can enforce. SP2 may realise his security, but if he is selling free from SP 1 's mortgage he must obtain SP l's consent and must apply the proceeds in discharge of that mortgage before taking what is due to him. If, however, SP2 is selling subject to SP 1 's mortgage SP 1 is not affected by the sale and his consent is not required. His mortgage continues to attach to the property and SP2 is not accountable to him for any part of the proceeds, but must take what is due to him and then pass any surplus to the next mortgagee, if any, or, if none, to the debtor. Where SPl has himself become entitled to enforce his mortgage and chooses to do so after SP2 has initiated steps to en[ orce his own mortgage, SP 1 is entitled to take control in priority to SP2." (Emphasis added) R2 1.3 Applying that proposition to this case, whereas it would appear (primafacie) that the First Defendant may not have required the Plaintiffs' consent to enforce her debenture, (by appointing the Second Defendant as receiver}, the invoking of a similar right by the Plaintiffs based on their debenture means that their appointed receiver is entitled to take charge in priority to the Second Defendant's appointee. 1.4 I therefore find it justified to grant some form of injunctive relief. However, based on the material now on record, it is fair and just to modify the order granted ex-parte and replace it with an order which I hereby make as follows- (i) the Second Defendant is hereby restrained from conducting any of the affairs of Tongabezi Limited without the written authorization of Mafipe Chunga in the latter's capacity as a receiver of Tongabezi Limited; (ii) the Second Defendant shall together with Mafipe Chunga act as joint receivers of Tongabezi Limited subject to the overriding authority of Mafipe Chunga whilst the two of them hold such office; (iii) this order shall subsist until final determination of this matter or further order of Court, and (iv) costs hereof shall be in the cause. 1.5 I also used today's hearing as an opportunity for a Bar-Bench consultation as a result of which the substantive matter is: (i) set for scheduling conference on 16th May 2024 at 09:00 hours; and R3 (ii) in parallel, referred to a first round of mediation for possible settlement. Dated this --------------------------- ~ ---------~ ------------------------ 2024 K. CHENDA Judge of the High Court R4