Enga-Enga and Anors v Choongwa and Anors (SCZ Appeal 46 of 1989) [1991] ZMSC 32 (12 September 1991)

IN THE SUPREME COURT OF ZAMBIA SCZ Appeal No, 46 of 1989 ' ■ ■ ■ ■ • • HOLDEN AT LUSAKA (Civil Jurisdiction) MATTHES KABWE ENGA-EHGA GEORGE 3WALYA CHISHIMBA Appellants and k uMoongwa 1st Respondent 2nd Respondent .4- - <? CORAM? Gardner, Challa Md Lawrence JJJ. S. 31st May 1990, 14th June 1990 and 12th September 199t Appellants, appeared In person Mr. M. Hlchelo, appeared for the first respondent Mr. Sipalo, appeared for Lina Bank JUDGMENT Chaila, J. S. delivered the judgment of the court. The appellants (hereinafter referred to as "the plaintiffs") are appealing against the decision of the High Court made on 16th December 1988. The learned trial judge dismissed the plaintiffs action for possession of farm No. 3689 Chibwe. The facts of the case were that the farm No. 3689 Chibwe belonged to Tobacco Board of Zambia (hereinafter called "the T8Z)♦ The farm was leased to the first respondent for one season in 1981/82. The first respondent moved as a tenant to the farm and while in tenancy the first plaintiff approached the T8Z with a view to buying the farm. After looking at various farms, the first plaintiff picked fans No. 3689 Chibwe since the farm at the time was not committed to any particular person. The TBZ offered the farm for sale to the first plaintiff. The first respondent being considered as the tenant was advised to move out but the first respondent argued that he had put in too much work and indicated that he would not accept money as compensation. The TBZ did seek legal advice and they were advised that they were entitled to remove the first respondent since the first respondent was a tenant for a year. The TBZ acted on that advice and t • J2 • i went ahead to assign the farm to the first plaintiff. The lower court held that the T3Z were not Justified in that action, in that they were not entitled to do so since they were not the owners. Before the fare had bean assigned to the first plaintiff various fares which Included fans Ho, 3689 were transferred under book entry arrangement to the Agricultural Finance Company (AFC), As a result of this book entry the first respondent approached the second respondent for a loan to purchase the said fare. There was some correspondence from the Soard Secretary which Indicated that th* said fans was on the list of the farms transferred under book entry. The first plaintiff proceeded with negotiations with the TBZZ" The assignment was made to him. The state consent was granted and title deeds were completed and the property was passed to the first plaintiff and second plaintiff. The learned trial judge considered the issues before her. She looked at the correspondence from Tobacco Board of Zambia arid came to the conclusion that the farm could not be assigned to the first plaintiff by T8Z since it had no good title to pass to the first plaintiff and she dismissed the application by the plaintiffs. The plaintiffs have advanced various grounds In support of their appeal, but the major ground is that the TBZ was a registered owner of farm No. 3688 and were therefore legally competent to transfer the property and that the learned trial judge misdirected herself when she ruled that the TBZ did not have any title to transfer the said property. They have argued that the first respondent was only a tenant for a term namely 1981/02 and that the TBZ offered the farm for sale to the first plaintiff. The offer was made on 2nd Juno, 1983 and the offer was accepted on 8th July 1983, The TBZ proceeded to get consent and the consent was renewed on 26th June 1985 and 26 th June 1987 respectively. They have argued that after the expiry of the agreement with the TBZ, the respondent was told to leave the farm and give way to the first appellant, that was on 6th February 1984, They have argued that the lima Bank, the third party, were informed of the TB2‘s decision through a copy sent to them dated Sth February 1984. They further argued that the Lima Bank went ahead to prepare the contract of sale and the matter was referred to the Legal ^rvlces Corporation. The.assignment took a long time to complete because the first respondent had lodged a caveat. The TBZ later contested the matter on the ground that there was no merit. After caveat had been removed, the consent to assign was renewed and the assignment.was completed and a certificate of title was Issued in the name of the plaintiffs. The plaintiffs have maintained that they were undisputed owners of the farm and that the court should find tn their favour* They have . argued that all the transctlons were done openly and that there was no fraud. They have further argued that AFC were aware of what was happening and that the TBZ never acted in an underhand way. Mr. Hichelo appearing for the first respondent has argued that the learned Commissioner did not oisdirect herself in her conclusion and that the farm was covered by the book entry. He has argued that the transfer of title was completed sometime in 1981* He has argued that the TBZ owed AFC money in the fora of loans to run farms. It was then agreed ? that AFC should take over the farms for the money owing to AFC by the T8Z. He argued that the farm was passed to AFC and that since the transfer was between two government institutions assignment and registration were going to take place later. He has argued that the people who were at fault were AFC and the TBZ. He has accused the TBZ of being dishonest. He attacked the TBZ on their confirmation in 1983 that they ? had no interest in the farm and yet In 1987 they sold the farm* Nr. Mlchelo maintained that there was duress from higher authorities and there was pressure on the TBZ. The TBZ ceased to be clean and.became fraudulent. He has further argued that there was negligence in thatthey did not protect the first respondent’s interest. ' " . i - .. < Mr. Slpalo, Counsel for the second respondent has advanced the following grounds:- 1» The learned trial Carnal ss loner as she was then called ' found as a fact that "the documents before me show beyond doubt that Farm Ho. 3689 Chibwe was covered under the book entry arrangement between TBZ and AFC long before the purported assignment by TBZ of the same fam to the plaintiffs. This means that TBZ did not have good title to pass to the plaintiffs". The learned trial Comalssloner as she was then called, 2. did not misdirect herself in finding that the Appellant came on the scene in June 1987 as this is consistent with the facts. The learned trial Canals$loner did not misdirect herself 3. in finding that Fara No. 3689 was covered under the long standing Book Entry arrangement between TBZ and AFC. • * 44 * . The question of registration of the properties cannot 4. be in issue as this was being processed. The TBZ • AFC book transfer arrangements took sometime to Implement. TBZ having acknowledged receipt of consideration for the properties and therefore having transferred title of the properties to AFC Halted cannot now deny AFC Halted (now Lima . Bank Limited).from . exercising its rights as an assignee* In support of these grounds Mr. Slpalo has argued that the contract to transfer the fans from, the TBZ to AFC was done In.1981, The first respondent was in possession of the farm, AFC advanced a loan to the first respondent for him to develop the farm. The loan to purchase the farm was obtained. The first respondent gpt the loan of K13.000 and1 the Ioan has been repaid to AFC, He has argued that the money was advanced to the first respondent because the TBZ had transferred the farm to AFC, Mr. Sipaid admitted that the first respondent did not obtain the title deeds and that an assignment was not registered and was therefore invalid. At first Mr, Slpalo argued that the whole thing was done behind the back of AFC end .that the TBZ acted fraudulently but later when referred to various documents Mr. Slpalo conceded that the registration was not obtained behind AFC’s back. He further admitted that a mistake had been made when AFC’s advocate referred Mr, Enga-enga to legal Services Corporation* But In defending the learned trial Judge’s decision Mr. Slpalo has urged the court to consider equity and asked the court in this case to apply that principle. He has argued that the first respondent was heavily indebted to the second respondent. He has argued that the first appellant has only lost K10.0Q0 which can be refunded to him. He has argued that the first respondent has been^on the farm since 1981, We have considered arguments of the appellants and respondents. The facts showed that there was a list of farms which were to be surrendered to AFC by the TBZ under book entry. But later farm Ro. 3689 was offered for sale to the first plaintiff. The first respondent was informed of the TBZ’s intention and was asked to move from the farm. But the first respondeat resisted* The TBZ sought legal advice and were advised that they were free to go ahead with the sale since the first respondent was merely a tenant for one season. The TBZ proceeded to make the necessary offers to the first plaintiff. At first Hr, Slpalo argued that the offer was done behind AFC’s back. But later he conceded that correspondence proved that the offer was done properly. The facts clearly show that the first appellant was referred by AFC’s - J5 - ■ counsel to Legal Services Corporation and later Legal Services Corporation finalised the matter. The facts and correspondence In the matter do not support the first respondent’s contention that there was fraud on the part of the first plaintiff. The first plaintiff approached the TBZ in a normal manner to purchase the said farm and the TBZ offered It to him. The TBZ were the registered owners of the farm. The sale was not done behind the AFC’s back. The AFC were aware of what was going on between the TBZ and the first plaintiff. Book entry of various farms by the TBZ to AFC was not followed by assignment and registration by AFC. The TBZ still had title in the said farm. They made the offer to the first, plaintiff and the offer was accepted. At first the first respondent placed a caveat on the property In order to protect his Interest. Later this caveat was removed by an order of the . court. We do not agree with the findings of the learned trial judge that the TBZ had no title to the property to pass* To the contrary the TBZ held a very strong title* The property was offered properly to the first plaintiff and consequently the first plaintiff obtained good title in the said farm. Mr. Mlchelo argued that there was fraud on the part of the TBZ but he never accused the first plaintiff of being fraudulent in the dealings. The first plaintiff was very open in the matter and there was no fraud on his part. There was no fraud on the part of the TBZ. There were definitely some mistakes made by the TBZ and AFC. The AFC never obtained formal assignment of the property. A mere book entry transfer does not satisfy the requirements of the Lands and Deeds Registry Act* Cap* 287. The AFC were required to' follow up the matter and obtain good title to the property which they- would later pass on to a prospective purchaser. That was not done in respect of farm No. 3689. The property.still remained the property of the TBZ and when the TBZ sold the property to the first plaintiff they passed a good title. The appeal 1$ therefore allowed and the finding of the learned trial Commissioner, as she then was» Is set aside and we enter judgment in favour of the first and second appellants with costs. We are aware that the first respondent may have some crops on the farm and we order that he yields up possession of the farm within three months hereof. - J6 - B. T. Gardner SUPREME COURT JUDGE M. S. Challa SUPREME COURT JUDGE A. R' Lawrence SUPREME COURT JUDGE . ■ s ■ ’ *■ v > • -1 ri • ; 1 ’ - ■ " r. X'