Konkola Copper Mines Plc (In Liquidation) v Kumbele Mining Company Limited and Anor (2020/HKC/0044) [2024] ZMHC 188 (26 September 2024)

IN THE HIGH COURT FOR ZAMBIA 2020/HKC/0044 (Commercial Division) BETWEEN: KONKOLA COPPER MINES PLC (In AND KUMBELE MINING COMPANY LIMITED THE ATTORNEY GENERAL 1 ST DEFENDANT 2ND DEFENDANT Before the Honourable Mr. Justice E. Pengele in Chambers on the 26th September, 2024. For the Plaintiff: Mr. Elijah C. Banda, SC, with Mr. N. Chaleka of Messrs. ECB Legal Practitioners with Co-Counsel Mr. Mulenga Chiteba and Mr. Peter Chomba of Messrs. Mulenga Mundashi Legal Practitioners. For the 1st Defendant: Ms. S. Namusamba of Messrs. Shamwana & Company with Co Counsel, Mrs. L. Tembo Chilinda, Mrs. B. M. Kalobo and Mrs. N. M. Mumba of Messrs. James and Doris Legal Practitioners. For the 2 nd Defendant: Mr. L. Sikabanga, State Advocate, Attorney General's Chambers. RULING Cases referred to: 1. Cooperative Muratori and Cementisti - CMC Di Ravenna V. Lufubu Power Company Limited and Nico Insurance Zambia Limited, CAZ/08/099/2020; 2. Rosemary Bwalya V. Mwanamuto Investments and Others, CAZ/08/ 139 /2017; · 3. Anuj Kumar Rhathi Krishnan V. The People, SCZ Judgment No. 19 of 2011; 4. Tiger Animal Feeds Limited V. Collins Bowa and 7 Others4, Appeal No. 136 of 2022; 5. John Mumba and 3 Others V. Zambia Red Cross Society, Appeal No. 141 of 2005; 6. Turnkey Properties V. Lusaka West Development Company Limited and Others, SCZ Judgment No. 3 of 1984; 7. Stanely Mwambazi V. Morester Farms Limited (1977) ZR 108; 8. Barclays Bank Pie V. Njovu and Others8, SCZ Appeal No. 21 of 2019; 9. Counsel referred me to the case of Director of Public Prosecutions V. Esther Nyawa Tembo Lungu, 2023/HPEF/23; R2 10. Intelligent Mobility Solutions Limited V. Lamise Trading Limited, Appeal No. 214 of 2022; 11. Monk V. Bartram (1891) 1 QB 346; 12. Winchester Cigarette Machinery Limited V. Payne and Another 2 Times Law Reports of 15/12/1995; 13. Linotye-Hell Finance Limited V. Baker (1992) 4 All ER 887; 14. Zambia Revenue Authority V. Post Newspapers Limited, Appeal No. 36 of 2016; 15. Blair Freight International Limited V. Credit Africa Bank Limited, SCZ Appeal No. 2009 of 1997; 16. Zambia Revenue Authority V. Jayesh Shah (2001) ZR 60; 17. Charles Kabwita and Others V. NFCA Mining Pie (2012) 2 ZR 103; 18. Zambia Revenue Authority V. Professional Insurance Corporation Zambia Limited, Appeal No. 34 of 2017; 19. Brenda Muzyamba V. Sinabbomba and Others Appeal No. 11 of 2019; 20. Sinkamba V. Doyle (1974) ZR 1; 21. Samuel Miyanda V. Raymond Handahu (1994) Appeal No. 25 of 1994; and 22. Preston V. Luck (1884) 27 Ch 497. R3 Legislation referred to: a. Rules of the Supreme Court of England, 1999 Edition; b. Court of Appeal Rules, Statutory Instrument No. 65 of 2016; c. Corporate Insolvency Act No. 9 of 2017; and d. High Court Rulesd, Chapter 27 of the Laws of Zambia. Other works referred to: i. Halsbury's Laws of England, Volume 37, 4 th Edition; and ii. Zambian Civil Procedure: Commentary and Casesii, Volume 2 at page 1138. 1. INTRODUCTION 1.1 This Ruling follows an application by the Plaintiff for stay of proceedings (hereinafter ref erred to as "the application for stay") pending the hearing and determination of an appeal by the Court of Appeal. The appeal to the Court of Appeal is against a Ruling of this Court in which it discharged an order of interlocutory injunction which had been granted earlier to the Plaintiff. 1.2 The Plaintiff filed its application for stay on 16th July, 2024, by way of summons and affidavit in support pursuant to Order 59, rule 13 of the Rules of the Supreme Court of R4 Englanda, as read with Order X, rule 5 of the Court of A eal Rulesb and the inherent jurisdiction of the Court. 1.3 On 22 nd July, 2024, the 1st Defendant filed an affidavit and skeleton arguments 1n opposition to the Plaintiffs application for stay. 1.4 On 13th August, 2024, the 2nd Defendant also filed an affidavit and skeleton arguments in opposition to the Plaintiffs application for stay. 2. BACKGROUND 2.1 The brief background to the Plaintiffs application for stay is that, on 11 th June, 2024, this Court delivered a Ruling in which it discharged the order of interlocutory injunction which was granted to the Plaintiff in an earlier Ruling of 29 th October, 2020. 2.2 Dissatisfied with this Court's Ruling of 11 th June, 2020, the Plaintiff has lodged an appeal to the Court of Appeal. The Plaintiffs present application is to entreat this Court to stay these proceedings pending the hearing and determination of the appeal by the Court of Appeal. RS 3. PLAINTIFF'S AFFIDAVIT IN SUPPORT OF APPLICATION FOR STAY 3.1 The affidavit in support of the Plaintiffs application for stay is deposed to by Glory Mwenya Chipoya, the Senior Legal Counsel for the Plaintiff. 3.2 The gist of the depositions by Glory Mwenya Chipoya is that, as a matter of law, a provisional liquidator is required to obtain leave of Court prior to disposing of any assets of the company in provisional liquidation. In its discharge Ruling, this Court did not consider the provisions of the Corporate Insolvency Actc before arriving at the conclusion that the Provisional Liquidator of the Plaintiff had sold the surface rights over the Luana Disputed Area. 3.3 The deponent went on to state that the failure by the Provisional of Liquidator of the Plaintiff, to obtain leave of the Court prior to entering into any arrangements, transactions or consent with the 1st Defendant for a possible sale or disposal of the assets of the Plaintiff, was fatal to such arrangements or transactions. 3.4 The deponent further stated that the grounds of appeal to the Court of Appeal have reasonable prospects of success. There are compelling reasons for this Court to stay the present proceedings pending the hearing and determination of the appeal before the Court of Appeal. R6 3.5 He added that the issues raised in the appeal have a bearing on the proceedings before this Court. For this reason, it will be in the interest of justice to stay these proceedings until the appeal is heard ·and determined by the Court of Appeal. If the stay is not granted, any decision made by the Court of Appeal in favour of the Plaintiff may be rendered nugatory and an academic exercise. 4. PLAINTIFF'S SKELETON ARGUMENTS IN SUPPORT OF APPLICATION FOR STAY 4.1 On 16 th July, 2024, the learned Counsel for the Plaintiff filed a list of authorities and skeleton arguments in support of the application for stay. The kernel of Counsel's arguments is that this Court has jurisdiction to grant an order of stay of proceedings pending the hearing and determination of an appeal by the Court of Appeal. For this, Counsel referred me to Order 59, rule 13 of the Rules of the Supreme Courta and Order X; rule 5 of the Court of Appeal Rulesh. 4.2 Counsel recognized the fact that the Court's power to grant a stay of proceedings is discretionary and that a stay will only be granted where there are special circumstances. In Counsel's opinion, special circumstances exist in this case. Firstly, the grounds of appeal in the memorandum of appeal have reasonable prospects of success. Secondly, if these R7 proceedings are allowed to continue, the appeal will be rendered nugatory and an academic exercise. 4.3 To augment the foregoing, Counsel relied on the cases of Cooperative Muratori and Cementisti - CMC Di Ravenna V. Lufubu Power Company Limited and Nico Insurance Zambia Limited 1 and Rosemary Bwalya V. Mwanamuto Investments and Others2 . Counsel also relied on paragraph 59 / 13 / 2 of the Rules of the Supreme Courta; and Halsbury's Laws of England1 , paragraphs 930 and 926. 4.4 Counsel went on to argue that the proposed grounds of appeal have reasonable prospects of success. Counsel contended that, in determining whether there are prospects of success on appeal, this Court is not obliged to assess each and every ground of appeal. The Court is only required to determine whether, on the face of it, there is a case to be argued on appeal. To augment the foregoing arguments, Counsel referred me to the case of Anuj Kumar Rhathi Krishnan V. The People3 , on the extent to which the Court may examine the grounds of appeal when considering the prospects of success of an appeal. 4.5 Counsel proceeded to demonstrate the reasonable prospects of success of each of the three grounds of appeal. RS 4.6 On the first ground of appeal, Counsel submitted that this Court erred in law when it refused to allow the Plaintiff to make submissions purely on points of law at the discharge hearing. In Counsel's view, there is no law in this jurisdiction which bars a litigant from making submissions purely on points of law and by placing reliance on documents already on the record. According to Counsel, the denial stifled the Plaintiffs right to be heard on the merits. To augment the foregoing submissions, Counsel cited the case of Tiger Animal Feeds Limited V. Collins Bowa and 7 Others4 . 4.7 On the second ground of appeal, Counsel submitted that section 103(1) of the Corporate Insolvency Actc, requires a liquidator to first make a determination that a particular asset should be sold. Thereafter, the liquidator must obtain leave of the High Court to sell that asset. It is only. when leave of the Court has been obtained that the liquidator can proceed to sell. 4.8 Coming to the third ground of appeal, Counsel contended that this Court should have restricted itself to the application by the 1st Defendant for the discharge of the order of injunction. In Counsel's opinion, the Court erred when it started assessing the pleadings before it and making pronouncements on the pleadings. R9 4. 9 To reinforce the foregoing contentions, Counsel relied on the cases of John Mumba and 3 Others V. Zambia Red Cross Society5 ; Turnkey Properties V. Lusaka Development Company Limited and Others6 Stanely Mwambazi V. Morester Farms Limited7 • West and ; 4.10 Counsel maintained that it was improper for this Court to have delved into the merits of the case and proceeded to make a finding of fact that the Plaintiff had sold its surface rights to the 1 st Defendant when that issue was disputed. Disputed or triable issues ought to be decided on the merits at trial. 4.11 In conclusion, Counsel implored me to stay these proceedings pending the hearing and determination of the appeal by the Court of Appeal. Counsel prayed that costs relating to this application be in the cause. 5. 1 sT DEFENDANT'S AFFIDAVIT IN OPPOSITION TO THE APPLICATION FOR STAY 5.1 The 1st Defendant's affidavit in opposition to the application for stay is deposed to by Huang Hanzhou, the Managing Director of the 1st Defendant Company. He has deposed that this Court's discharge Ruling was based on more than the Plaintiff not disputing having sold surface rights and the 1st Defendant having paid for the said surface rights. Rl0 5.2 He went on to state that the order which appointed the Plaintiffs Provisional Liquidator also granted the Liquidator power to sell real property by private contract. In this regard, he exhibited a copy of an order marked "HH 1 ". 5.3 It was his further deposition that the Plaintiff will not be prejudiced if these proceedings continue while the appeal is pending before the Court of Appeal. 6. 1 sT DEFENDANT'S SKELETON ARGUMENTS IN OPPOSITION OF APPLICATION FOR STAY 6.1 On 22 nd July, 2024, the learned Counsel for the 1st Defendant filed skeleton arguments in opposition to the Plain tiffs application for stay. 6.2 The essence of Counsel's submissions is that the grant of a stay of proceedings is in the discretion of the Court. For this submission, Counsel relied on the case of Barclays Bank Pie V. Njovu and Others8 . 6. 3 Counsel ref erred me to the case of Director of Public Prosecutions V. Esther Nyawa Tembo Lungu9 to reinforce their contention that a stay of proceedings should only be granted when there are special circumstances. 6.4 Counsel proceeded to address the prospects of success of each of the grounds of appeal seriatim. Rll 6.5 On the first ground of appeal, Counsel submitted that, since this is a commercial matter, this Court's refusal to allow the Plaintiffs Counsel to make oral submissions was in line with Order 53, rule 10(8) and (9) of the High Court Rulesd. Those provisions require an applicant in an interlocutory application to file, together with the interlocutory application, skeleton arguments . The requirement applies mutatis mutandis to a respondent to that application. 6.6 Counsel added that the foregoing is also reflected in Order 30 , rule 3A(3) of the High Court Rulesd. 6. 7 It was Counsel's additional argument that the refusal by this Court to allow the Plaintiff to make submissions on the law was fortified by the case of Intelligent Mobility Solutions Limited V. Lamise Trading Limited10. 6.8 Counsel maintained that allowing verbal submissions from the Plaintiff, purportedly purely on points of law, would not have cured its failure to file an affidavit. 6. 9 In Counsel's view, the instant case is distinguishable from the circumstances of the case of Tiger Animal Feeds Limited V. Collins Bowa and 7 Others4 . In that case, the party was only served with the application 3 days before the date of hearing. In the present case the Plaintiff had ample time to respond to the application but failed to do so. Rl2 6.10 Further, in the Tiger Animal Feeds Limited4 case, the parties were not called into Chambers to give an opportunity to Counsel for the respondent to address the failure to file the opposition. The position is different in the present case. 6. 11 Coming to the second ground of appeal, Counsel submitted that the supposed point of law, relating to the requirement for leave before the Provisional Liquidator could sell the surface rights, would have required Counsel for the Plaintiff to give evidence from the Bar. This is because that issue has not only been raised for the first time but it has also not been pleaded before this Court. 6.12 Counsel proceeded to point out that the Court Order appointing the Provisional Liquidator (exhibit "HH 1 ") gave the Provisional Liquidator the power to sell property. Counsel submitted that, in any case, in order to make the allegation that the Provisional Liquidator did not obtain leave of the Court, that fact would have had to be contained in an affidavit. 6.13 Counsel canvassed the view that ra1smg a factual allegation in arguments purporting to turn on legal issues would have not given the 1st Defendant an opportunity to factually respond. Further that, if the Plaintiffs argument is a valid argument, the Plaintiff will have an opportunity to Rl3 raise the argument in the same proceedings it is trying to stay. 6.14 With regard to the third ground of appeal, Counsel submitted that the finding that the Provisional Liquidator sold the surface rights was arrived at after considering the Plaintiffs own pleadings and its failure to deny that consent had been given for the sale of its surface rights. Counsel pointed me to paragraph 12 of the 1st Defendant's affidavit in support of the application to discharge the order of injunction. In that paragraph the 1st Defendant made reference to the Plaintiffs failure to deny that the 1st Defendant had paid to the Plaintiff the sum of K20,000,000.00. · 6.15 Counsel contended that the Plaintiff did not file an affidavit to oppose the above damning facts. Counsel referred me to some cautionary pronouncements made by the Court in the case of Director of Public Prosecutions V. Esther Nyawa Tembo Lungu9 on the possible dilatory effects of interlocutory appeals on the speedy resolution of cases. 6.16 In conclusion, Counsel argued that the grounds of appeal have no prospects of success. The stay will only save to delay the prosecution of the matter to the detriment of the 1st Defendant. R14 6.17 Counsel urged me to dismiss the Plaintiffs application for want of merit. 7. 2ND DEFENDANT'S AFFIDAVIT IN OPPOSITION TO APPLICATION FOR STAY 7.1 On 13th August, 2024, the 2nd Defendant filed an affidavit in opposition to the application for stay. The affidavit was sworn by Lweendo Sikabanga, the State Advocate having conduct of this matter on behalf of the Attorney General. 7.2 The gist of his depositions is that the Plaintiff did not oppose the application to discharge the injunction as the Plaintiff did not file an affidavit in opposition. 7 .3 The deponent went on to state that the Order which appointed the Plaintiffs Provisional Liquidator granted the Provisional Liquidator power to sell real property by private contract. He exhibited a copy of the Order as "LSl". 7.4 He went on to state that the Plaintiff has not demonstrated any special circumstances to satisfy · this Court that there are good and convincing grounds to warrant a stay pending appeal. Further, the Plaintiff has not shown any prejudice that it is likely to suffer if this Court does not grant the stay. RlS 8. 2ND DEFENDANT'S SKELETON ARGUMENTS IN OPPOSITION TO APPLICATION FOR STAY 8.1 On 13 th August, 2024, the learned Counsel for the 2nd Defendant filed skeleton arguments in opposition to the Plaintiffs application for stay. 8.2 The gravamen of the arguments is that a stay can only be granted if special circumstances exist which take the case out of the ordinary; the appeal has prospects of success; and the applicant would be ruined without a stay. To reinforce the foregoing, Counsel cited the cases of Monk V. Bartram 11 ; Winchester Cigarette Machinery Limited V. Payne and Another 12; and Linotye-Hell Finance Limited V. Baker13 • 8.3 Counsel went on to refer to the case of Barclays Bank Pie V. Njovu and Others8 for the position that orders of stay of proceedings should not be routinely granted as they have the effect of denying the successful party the benefits of their judgment or unduly delaying the conclusion of matters. 8.4 The further contention of Counsel was that the subject Ruling cannot be stayed because it did not award any remedy such as money or property which can be a subject of court execution. For this, Counsel cited the case of Rl6 Zambia Revenue Authorit V. Post News a ers Limited 14 . 8.5 The additional submission of Counsel was that the prospects of success and the likelihood of the appeal being rendered nugatory cannot be considered as special circumstances which would take the case out on the ordinary as decided in the case of Winchester Cigarette Machinery Limited V. Payne and Another 12• 8.6 Counsel proceeded to deal with the prospects of success of the Plaintiffs grounds of appeal. 8. 7 On the first ground of appeal, Counsel submitted that the Plaintiff sat on its rights by not filing an affidavit in opposition and skeleton arguments. For this submission, Counsel relied on Order 53, rule 10(8) and (9) and Order 30, rule 3A(3) of the High Court Rulesd. 8.8 Counsel cited the cases of Blair Freight International Limited V. Credit Africa Bank Limited15 and Zambia Revenue Authority V. Jayesh Shah 16• 8. 9 According to Counsel, the failure to abide by the Rules was fatal. For this, Counsel referred me to the case of Intelligent Mobility Solutions Limited V. Lamise Trading Limited 1°. 8.10 Counsel went on to submit that there was no requirement for the Provisional Liquidator to obtain leave of the Court to R17 sell the surface rights because leave was already granted in the Order of appointment. 8.11 On the second ground of appeal, Counsel contended that the issue of selling surface rights was not disputed by the Plaintiff because it did not file an affidavit in opposition. Further, a look at the Plaintiffs defence to the 1st Defendant's counterclaim shows that the Plaintiff did not dispute having sold the surface rights to the 1st Defendant. 8.12 In conclusion, Counsel submitted that the Plaintiff has failed to show that it is entitled to the order of stay. 9. PLAINTIFF'S AFFIDAVIT IN REPLY 9.1 On 20 th August, 2024, the Plaintiff filed an affidavit in reply. The affidavit was deposed to by Glory Mwenya Chipoya, the Plaintiffs Senior Legal Counsel. He stated that the ex-parle order appointing the Provisional Liquidator does not override the legal requirement for a provisional liquidator to obtain leave of Court before disposing of an asset of a company in provisional liquidation. 9.2 The deponent stated that the appeal before the Court of Appeal has a great bearing on the proceed1ngs before this Court. If these proceedings are not stayed there may be conflicting decisions between this Court and the Court of Appeal. Rl8 9.3 He went on to say that the issues surrounding the power of the Provisional Liquidator to sell the assets of the Company in liquidation are the subject of the proceedings before the Court of Appeal. 9.4 The deponent added that, on 8 th July, 2024, the 2nd Defendant entered into a consent judgment with the Plaintiff under Cause No. 2024/HP/0951. The consent judgment ordered that various properties, transferred by the Provisional Liquidator without leave of the Court, were illegally transferred. The 2nd Defendant is estopped from taking a position different from the one taken under the consent judgment. 9.5 It was his further deposition that the Plaintiff will suffer prejudice because the Ruling which discharged the order of injunction did not address the pertinent issue of the failure by the provisional liquidator to obtain leave to sell the Plaintiffs surface rights to the 1st Defendant. 10. PLAINTIFF'S SKELETON ARGUMENTS IN REPLY 10.1 On 20 th August, 2024, the leaned Counsel for the Plaintiff filed skeleton arguments in reply. Counsel repeated most of the arguments and authorities contained in their skeleton arguments in support of the application for stay. I will not reproduce the repeated components. Rl9 I 10.2 The crux of the remainder of Counsel's arguments in reply was that the application by the Plaintiff is for a stay of proceedings and not a stay of execution. The considerations cited by the 2nd Defendant from the case of Zambia Revenue Authority V. Post Newspapers Limited 14 are on stay of execution and not stay of proceedings. 10.3 According to Counsel, the 2nd Defendant is bound by the position in the consent judgment dated 9th July, 2024, under Cause No. 2024 /HP /0951. To buttress this, Counsel referred the Court to Zambian Civil Procedure: Commentary and Casesu, at page 1138. Counsel also cited the case of Charles Kabwita and Others V. NFCA Mining Plc11. 10.4 Counsel contended that the 2nd Defendant is estopped from taking a position different from the one it took in the consent judgment under Cause No. 2024/HP/0951. In this regard, Counsel relied on the case of Zambia Revenue Authority V. Professional Insurance Corporation Zambia Limited 18 . 10.5 With regard to Order 53, rule 10(8) and (9) of the High . Court Rulesd, Counsel expressed the opinion that the use of the words "wherever possible", in sub-rule (8), signifies room for not filing. According to Counsel, an example of a case in which it was not possible was this case. Further, none of the provisions cited by the 2nd Defendant state that ' R20 if a party does not file an affidavit and skeleton arguments, they cannot make viva voce arguments at the hearing. 10.6 Counsel added that the 2nd Defendant cannot argue that leave to sell the surface rights in 2020 was obtained retrospectively in the ex-parte order of 2019. 10. 7 Counsel relied on the case of Brenda Muzyamba V. Sinabbomba and Others 19 , for the position that where leave to sale is required and a party proceeds to sell without leave, the sale is a nullity. 10.8 Counsel cited the cases of Sinkamba V. Doyle20 and Samuel Miyanda V. Raymond Handahu21 relating to statutory interpretation. 10.9 In conclusion, Counsel urged the Court to stay these proceedings pending the hearing and determination of the appeal. 11. HEARING 11.1 When the Plaintiffs application came up for hearing on 23rd July, 2024, Counsel for the parties relied entirely on the documents on the record. 12. CONSIDERATION AND DECISION 12.1 I have carefully considered the application by the Plaintiff to stay these proceedings pending the hearing and determination of the Plaintiffs appeal by the Court of R21 Appeal. I have also considered the opposition by both Defendants. Further, I have taken into account the skeleton arguments and oral submissions of Counsel for the parties. 12.2 The broad question raised by the Plaintiffs application is whether or not I should stay these proceedings pending the hearing and determination of the appeal before the Court of Appeal. 12.3 There is no contest that the grant of a stay of proceedings pending appeal is in the discretion of the Court. The Court will be more inclined to grant a stay of proceedings where an appeal would otherwise be rendered nugatory. Further, the applicant must demonstrate special circumstances to satisfy the Court that there are good and convmcmg grounds to warrant the stay of proceedings. 12.4 Counsel for the Plaintiff have argued that special circumstances exist to warrant a stay of these proceedings. They have justified the existence of special circumstances on two grounds, namely- A. that the grounds of appeal have reasonable prospects of success; and B. that in the event that these proceedings are not stayed the appeal would be rendered nugatory and an academic exercise. R22 12.5 Counsel for the Plaintiff have proceeded to briefly demonstrate the prospects of success of each of the Plaintiffs three grounds of appeal. 12.6 The Defendants' skeleton arguments have reacted to the Plaintiffs' skeleton arguments in the like manner. 12 .7 I, however, propose to make a cursory preview of the first and second grounds of appeal together because they are closely related. I will, thereafter do a quick preview of the third ground of appeal separately. My authority for previewing the grounds of appeal is the Supreme Court decision in the case of Anuj Kumar Rathi Krishnan V. The People 3 , which has been cited to me by Counsel for the Plaintiff. In that case, the Supreme Court said the following: "Regarding the prospects of success, the learned single judge of the Supreme Court declined to consider each ground of appeal separately and instead considered them in general. We agree with Mrs. Khuzwayo that it was not for the single judge to delve into the merits of each ground, but it sufficed that she examined all the grounds and made her conclusion primafacie that the prospects of success of the appeal were dim." R23 A. PROSPECTS OF SUCCESS OF THE GROUNDS OF APPEAL (1) FIRST GROUND OF APPEAL - REFUSAL TO ALLOW PLAINTIFF TO MAKE SUBMISSIONS AT HEARING (2) SECOND GROUND OF APPEAL FAILURE BY PROVISIONAL LIQUIDATOR TO OBTAIN LEAVE PRIOR TO SALE OF SURFACE RIGHTS 12.8 Counsel for the Plaintiff have argued that there is no law in this jurisdiction which bars a litigant from making submissions or arguments purely on points of law at the hearing. For this arguments, Counsel have relied on the case of Tiger Animal Feeds Limited V. Collins Bowa and 7 Others4 . 12.9 Conversely, Counsel for the 1st Defendant has submitted that, being a commercial action, the applicable provision is Order 53, rule 10(8) and (9) of the High Court Rulesd. 12 .10 I have taken time to carefully read both the Tiger Animal Feeds Limited4 case as well as Order 53, rule 10(8) and (9) of the High Court Rulesd. 12 . 11 In the Tiger Animal Feeds Limited4 case, the Court of Appeal held as follows: "The learned Registrar did not consider that the application was filed on 10th November, 2021 but only served on the Appellant on the 23rd November ' R24 2021 three days before the hearing on the 26th November, 2021. In our view, instead of delivering a Ruling, only on the basis of the Respondents' affidavit in support, the learned Registrar should have heard both parties on the day scheduled for the hearing because parties are at liberty to not file an affidavit in opposition and proceed by arguing the law. The learned Judge failed to consider that by proceeding without hearing the parties, the learned Registrar off ended Order 30 Rule 6A of the High Court Act as amended by S. I No. 58 of 2020, and as held in the Natural Valley Case supra, her Ruling deserves to be declared "a no-decision"." 12.12 It is plain from a reading of the Tiger Animal Feeds Limited4 Judgment that the case originally emanated from the Industrial Relations Court Division of the High Court. It was an employment matter. It was not a commercial action. 12.13 It is trite law that the Industrial Relations Court Division is required to do substantial justice in cases taken to it. In fact, in the Tiger Animal Feeds Limited4 case, the Court of Appeal recognized the fact that the parties before the Industrial Relations Court are supposed to be afforded substantial justice. The Court of Appeal specifically stated the following at page J16: R25 "As quite rightly pointed out by Counsel for the Appellant, substantial justice applies to all the parties to a matter and substantial justice requires that all parties be afforded the opportunity to be heard." 12 .14 I hold the firm view that, m the Tiger Animal Feeds Limited4 case, the Court of Appeal arrived at the pronouncements relied on by Counsel for the Plaintiff on the basis of the specific facts of that case. In particular, the Court of Appeal made those pronouncements with the background that the matter was coming from the Industrial Relations Court, which is enjoined to do substantial justice to the parties appearing before it. 12.15 My considered view is that the facts of the case now before me are sharply distinguishable from the facts of the Tiger Animal Feeds Limited4 case. This is because, the case before me is a commercial action where the Court is not enjoined to do substantial justice. The Commercial Court has its own specialized Court Rules which have been deliberately designed to make the Court a fast track Court. 12 .16 In view of the foregoing, I agree with Counsel for the 1st Defendant that, this being a commercial action, the applicable provision is Order 53, rule 10(8) and (9) of the High Court Rulesd. R26 12.17 In so holding, I am fortified by Order 53 , rule 2(2) and (3) of the High Court Rulesd, which provides in mandatory terms that- "(2) Eyery commercial action shall be prosecuted in accordance with these Rules. (3) If there is any inconsistency between these Rules and the rules applicable to the general list in relation to commercial actions, these Rules shall, to the extent of the inconsistency, prevail in commercial actions." 12.18 The question now is- "what does Order 53, rule 10(8) and (9) of the High Court Rulesd say about the filing of affidavits and skeleton arguments in an interlocutory application". 12.19 Order 53, rule 10(8) and (9) of the High Court Rulesd provides as follows: "(8) An applicant in an interlocutory application shall file, together with the interlocutory application, skeleton arguments of the applicant's case, stating the facts, law and authorities relied upon with copies of such authorities, wherever possible. (9) Sub-rule (8) shall apply to a respondent filing an affidavit in opposition and to application for R27 assessment of damages." [Underlined for emphasis only] 12 .20 I hold that the requirements of Order 53, rule 10(8) and (9) of the High Court Rulesd are couched in mandatory terms as can be seen from the use of the mandatory term "shall". 12 .21 Therefore, m an interlocutory application before the Commercial Court, it is mandatory for the applicant to accompany the application with skeleton arguments. Further, it is unmistakable from Order 53, rule 10(8) and (9) of the High Court Rulesd that it is mandatory for a respondent to an interlocutory application before the Commercial Court to file an affidavit in opposition and skeleton arguments. 12.22 However, in their skeleton arguments in reply, the learned Counsel for the Plaintiff have argued that the words "wherever possible" in sub-rule 8 of rule 10 imply that a party has the option of not filing the skeleton arguments. 12.23 I do not agree with the above interpretation by Counsel for the Plaintiff. It is plain from that sub-rule that the phrase "wherever possible" does not derogate from the mandatory requirement to file skeleton arguments. That phrase clearly refers to the "the copies of such authorities''. R28 In other words, the parties are required to provide copies of the law and authorities wherever possible. 12.24 In addition to the foregoing, in my Ruling of 4 th June, 2024, where I refused to allow Counsel to make oral submissions at the hearing, I relied on the Judgment of the Court of Appeal in the case of Intelligent Mobility Solutions V. Lamise Trading Limited10 • 12.25 It is noteworthy that, unlike the case of Tiger Animal Feeds Limited4 , which originated from the Industrial Relations Court, the Intelligent Mobility Solutions10 case started from the Commercial Court Division. It was a commercial action. Therefore, the pronouncements of the Court of Appeal in the Intelligent Mobility Solutions10 case are more apt to the present action. 12.26 In the Intelligent Mobility Solutions 10 case, the Court of Appeal pronounced itself as follows , at page J 1 7, paragraphs 7 .38 and 7 .39 to Jl8, paragraph 7.40: "7.38. Since it is not permissible for Counsel to give facts from the bar, it follows that it is not permissible for Counsel to rue a document containi.ng a mixture of facts and law if there is no affidavit before the Court deposing to the facts of the case. R29 7.39 The above view is based on the fact that once a competent person has deposed to the facts within their knowledge, and such affidavit is f'lled into court, the facts the skeleton arguments will be speaking to will be as deposed to in the affidavit. 7.40 Allowing skeleton arguments not backed by an affidavit in opposition would expose Counsel to giving evidence at the bar and that is reason enough to reject or expunge the skeleton arguments from the record." 12.27 On the authority of the foregoing pronouncements of the Court of Appeal in the I.ntelligent Mobility Solutions10 case, I held that the Plaintiff ought to have filed an affidavit in opposition before it could be allowed to make oral submissions. 12 .28 I still hold the considered view that, at least in so far as commercial actions are concerned, the decision in the Intelligent Mobility Solutions10 case, that Counsel should not be allowed to make oral submissions, in the absence of an affidavit deposing to facts, is still good law. 12.29 To the above extent, I agree with the argument by Counsel for the 1s t Defendant that, if Counsel for the Plaintiff had been allowed to make oral arguments at the hearing, on the alleged points of law, Counsel for the R30 Plaintiff would have invariably adverted to giving evidence from the Bar. This is because the alleged points of law, which Counsel wanted to raise at the discharge hearing, could not have been raised without basing them on the relevant factual basis. 12.30 It appears from the Plaintiffs affidavit in support and skeleton arguments in support of this application that the points of law, which Counsel intended to raise, were supposed to be premised on section 103(1) of the Corporate Insolvency Actc. In paragraph 13 of the affidavit in support, the deponent has stated that in the discharge Ruling this Court did not consider the provisions of the Corporate Insolvency Actc before arnvmg at the conclusion that the Provisional Liquidator had sold the surface rights. 12.31 Similarly, in their skeleton arguments, Counsel for the Plaintiff have submitted that this Court erred in law when it proceeded to discharge ·the injunction on the basis that the Provisional Liquidator had sold the Plaintiffs surface rights to the 1st Defendant without considering whether the purported sale, arrangement or transaction complied with section 103 of the Corporate Insolvency Actc. 12.32 The issue that arises invariably is whether the question of compliance with section 103(1) of the Corporate R31 Insolvency Actc was one of the issues that was raised for determination by this Court in the discharge application . 12 .33 Section 103(1) of the Corporate Insolvency Actc 1s couched in the following terms: 103. (1) Where a liquidator determines that the whole or part of the business or property of a company be transferred or sold to another corporate, the liquidator may with the- (a) special resolution of the company, in the case of a members' voluntary winding-up; (b) leave of the Court; or (c) approval of the committee of inspection, in the case of a creditors' voluntary winding-up; transfer or sell the business or property of a company and, in compensation or part compensation for the transfer or sale of the business or property of the company- (i) receive fully paid shares, cash, debentures or other like interests in the corporate for distribution among the members; or (ii) in lieu of shares, cash, debentures or other like interests, enter into any other arrangement where R32 the members may participate in the profits of, or receive any other benefit from, the corporate." 12.34 I hold the considered opinion that in the discharge Ruling, this Court could not have delved into a consideration of whether the sale complied with section 103 ( 1) of the Corporate Insolvency Actc. This is because the parties did not raise any factual issues relating to whether or not the Provisional Liquidator did not obtain leave of the Court before effecting the sale. 12.35 I do not agree with the apparent contention by Counsel for the Plaintiff that section 103(1) of the Corporate Insolvency Actc could have been raised at the discharge hearing, purely as a point of law, without the Plaintiff having first deposed to facts establishing that the Provisional Liquidator truly did not comply with that section. 12.36 From my reading of section 103(1) of the Corporate Insolvency Actc, that provision talks about the factual issue of the liquidator determining that the business or property of the company be sold. The provision goes on to talk about another factual issue of the liquidator obtaining leave of the Court to sell the property. 12.37 I am of the opinion that the questions of whether or not the liquidator actually made the determination to sell the R33 property and went further to obtain leave of the Court to sell are issues of fact which Counsel cannot argue at a hearing as points of law in the absence of an affidavit. 12 .38 It follows that Counsel cannot argue points of law premised on section 103(1) of the Corporate Insolvency Actc if there is no affidavit evidence deposing to the aforementioned factual issues. To put it another way, although section 103( 1) of the Corporate insolvency Actc is a provision of an Act of Parliament, proof of whether or not a given liquidator has complied with that section before selling a property unavoidably calls for evidence and not mere arguments on points of law. 12.39 In the present case, it is common cause that the Plaintiff did not file an affidavit in opposition to the discharge application. Therefore, there was no evidence to show that the Provisional Liquidator did not obtain leave of the Court before selling the Plaintiffs surface rights to the 1 st Defendant. 12.40 It follows that, if the Plaintiffs Counsel had been permitted at the discharge hearing, to make submissions based on section 103(1) of the Corporate Insolvency Actc, they would have fallen into the disallowed practice of Counsel giving evidence from the Bar. R34 . ' 12.41 Furthermore, it is clear that the Plaintiff wants to raise, before the Court of Appeal, the factual issue of whether or not the Provisional Liquidator obtained leave of the Court to sell. That factual issue was never raised nor determined in the impugned discharge Ruling. 12.42 On the totality of the foregoing, I hold that the prospects of success of the Plaintiffs first and second grounds of appeal are dim. (3) THIRD GROUND OF APPEAL - FINDING THAT PLAINTIFF HAD SOLD ITS SURFACE RIGHTS TO 18 T DEFENDANT WHEN ISSUE WAS DISPUTED AND COULD ONLY BE RESOLVED AT TRIAL 12.43 With regard to the third ground of appeal, Counsel for the Plaintiff has submitted that this Court erred when it proceeded to make a finding that the Plaintiff had sold the surface rights to the 1st Defendant. According to Counsel, the said issue was disputed and could only be conclusively resolved at trial. 12.44 It is clear from a reading of the discharge Ruling that this Court did not make any final findings of fact on the sale transaction. Further, this Court did not conclusively resolve the issue of the sale of surface rights. This Court simply reviewed the facts deposed to in the 1st Defendant's discharge application. The Court then stated that the R35 l I totality of those facts showed that, after the interlocutory injunction had been granted to the Plaintiff, the Plaintiff sold the surface rights to the 1st Defendant. 12.45 It is clear from this Court's discharge Ruling that this Court recognized that its holdings were only prima Jacie and that the Court was not supposed to make conclusive findings of fact at that stage, relating to the sale of the surface rights. It was for this reason that, in paragraph 5.21 of the discharge Ruling, this Court stated as follows: "Prima facie, the documents exhibited by the 1 •t Defendant in its affidavit in support plainly show that the pt Defendant paid the Plaintiff the full consideration sum of K20,000,000.00 for the surface rights over the contested area." 12 .46 In its affidavit in support of the discharge application, the 1st Defendant had referred to its counter-claim and the Plaintiffs defence to the counterclaim. This Court took a cursory look a t those pleadings. In paragraph 5 .27 of the discharge ruling, the Court pointed out its recognition that- "I hold the firm opinion that, in this application for the discharge or variation of the order of injunction, I cannot go into deciding on whether or not the 1 •t Defendant breached the conditions of the agreement. In my opinion, those are issues R36 l • which can only be resolved at trial after bearing the contesting evidence of both sides." 12.47 It is, therefore, clear that this Court did not make any conclusive findings of fact on disputed issues relating to the sale of the surface rights. 12.48 Consequently, I hold that the prospects of success of the third ground of appeal are equally dim. B. IN THE EVENT THAT THESE PROCEEDINGS ARE NOT STAYED THE APPEAL WOULD BE RENDERED NUGATORY AND AN ACADEMIC EXERCISE 12.49 The other issue raised by the Plaintiff is that, if these proceedings are not stayed, the appeal before the Court of Appeal will be rendered nugatory and an academic exercise. In this regard, in paragraph 19 of the affidavit in support of the application for stay , the deponent has stated that the issues raised in the appeal have a bearing on the proceedings before this Court. 12.50 In paragraph 20 of the same affidavit, the deponent has gone on to state that, if the stay is not granted, the decision in the appeal will be rendered nugatory and an academic exercise. 12 .51 My view is that the appeal before the Court of Appeal has no bearing on the proceedings in the main action before this Court. This is because the appeal relates to a Ruling on an R37 • I r, interlocutory application to discharge an interlocutory injunction. In my opinion, the discharge of the subject interlocutory order of injunction does not have any bearing on the progress and outcome of the main action before me. It is trite law that an interlocutory injunction is intended to maintain the status quo pending the hearing and determination of the main matter. To this extent, in the English case of Preston V. Luck22 , the Court held as follows: "The object of an interlocutory injunction is to keep things in status quo, so that if at trial the plaintiffs obtain a judgment in their favour, the defendants will have been prevented from dealing in the meantime with the property in such a way as to make the judgment ineffectual." 12 .52 From the above decision in the case of Preston V. Luck22 , I am inclined to hold that a party cannot use their pursuit for the reinstatement of an interlocutory injunction to delay the hearing and determination of the main action. 12.53 In any case, in my view, the decision of the Court of Appeal in the appeal will not be on the merits of the Plaintiffs main action or indeed the I st Defendant's counterclaim. The Court of Appeal's decision will deal with whether or not this Court properly directed itself when it discharged the order of interlocutory injunction. In other R38 J l words, the decision of the Court of Appeal will be on the question of whether or not the interlocutory injunction should have continued to subsist pending the hearing and determination of the main action. 12.54 It is trite law that an interlocutory order of injunction is supposed to subsist only pending the hearing and determination of the main action or until a further order of the Court. Therefore, the existence or non-existence of an order of interlocutory injunction does not have a bearing on the final decision of the Court in the main action. 12.55 Furthermore, I hold that the existence or non-existence of the order of interlocutory injunction will not have any effect on whether or not, after trial, this Court should grant the Plaintiff the injunction it has asked for in its writ of summons and statement of claim. 12 .56 After this Court makes its final decision in the main action, any dissatisfied party will have the liberty to appeal to the Court of Appeal against that decision. For this reason, I do not see any prejudice that the Plaintiff is likely to suffer if these proceedings are not stayed pending the hearing and determination of the appeal before the Court of Appeal. 12.57 On the basis of the foregoing, I hold that the decision of the Court of Appeal will not be rendered nugatory or an R39 ' . . I academic exercise if these proceedings are not stayed. Further, the Plaintiff will not suffer any prejudice if this Court refuse to delay these proceedings pending the hearing and determination of the appeal before the Court of Appeal. 13. CONCLUSION 13 .1 In conclusion, for the reasons I have given in this Ruling, I have found no merit in the application by the Plaintiff for stay of proceedings pending the hearing and determination of the appeal before the Court of Appeal. I, consequently, dismiss the Plaintiffs application with costs to be taxed in default of agreement. 13 .2 The 1st Defendant's application for entry of judgment on admission against the Plaintiff shall come up for hearing on 14th October, 2024 , at 08:30 hours. Delivered at Kitwe this 26th day of September, 2024. - - -~ E.r;;;i~-~;- HIGH COURT JUDGE JUDICIARY OF ZAMBIA HIGH COURT Commercial Division iL·•j ,J~ JUDGE-IN-CHARGE P. O. BOX 20135, KITWE R40