Mukulu Dairies Limited v Lactalis Zambia Limited and Anor (2021/HPC/0403) [2024] ZMHC 177 (20 March 2024)

IN THE HIGH COURT FOR ZAMBIA AT THE COMMERCIAL REGISTRY HOLDEN AT LUSAKA (Civil Jurisdiction) 2021 / HPC / 0403 IN THE MATTER OF: LACTALIS ZAMBIA LIMITED IN THE MATTER OF: SECTION 134 OF THE COMPANIES ACT, NO 10 OF 2017 IN THE MATTER OF: ORDER XLIV OF THE HIGH COURT RULES, CHA R.-!:i.~::.::::~::- S OF ZAMBIA BETWEEN: D\CIARY MUKULU DAIRIES LIM TIONER AND LACTALIS ZAMBIA LIMITE DALMATA SPA FIRST RESPONDENT SECOND RESPONDENT Before the Honourable Mr Justice K. Chenda on 20th March 2024 For the Petitioner For the Re~pondcnls : Mr M. Nclalamcta and Ms . H. Chilcshc of Ml\ Y & Company : Mr P. Chomba and Mr 0. l·lasal:1ma uf Muicnga· Mundashi Legal Practitioners RULING On Application for Leave to Appeal I have LISTENED ATTENTIVELY to the arguments verbalised and CLOSELY STUDIED the documentation on record. After a CAREFUL CONSIDERATION, my decision delivered ex-tempore is· as foliows. 1. 1 The Supreme Court guided in Breza Engineering Limited v GM International Limited and KCM - Vol. 1 (2010) ZR 46 at page 49 and 53, that an applicant for leave to appeal must demonstrate that there are realistic prospects of success on appeal to justify the grant of leave. 1.2 In the case before Court, the Respondents have not in this application demonstrated p11ma facie: (i) whether and how this Court misapplied the principles of law cited in the ruling of 27th February 2024; or (ii) anything new that has a bearing on the merits of the ruling. 1. 3 There are two proposed grounds of appeal according to the draft memorandum of appeal exhibited. The first seeks to challenge the conclusion of this Court that originating summons was the correct mode of commencement for redress under s.134(1) of the Companies Act, No. 10 of 201 7. The second takes issue with the exercise of this Court's discretion on costs. 1.4 However, given the doctrine of stare decisis, the jurisprudence cited by the Petitioner suggests doom for the intended first ground of appeal. In particular is the case of Chimanga Changa Ltd. v Export Trading Ltd. - Appeal No. 76/2020 at Jl 7 to J19, where Siavwapa, JP (then as JA) aptly guided as follows where a statute creates a right of redress by application to this Court but does not prescribe the mode of commencement: "13.1 COMMENCING AN ACTION R2 The arguments relating to whether or not the Respondent commenced the action properly when it moved the {;_Qr:ut b11 originating summons are clear. Equally the law governing how an action is commenced is clear as the Supreme Court of Zambia and Rules of procedure have long settled the debate. We therefore think that any arguments contrary to the clear provisions of the law are as a result of a serious misapprehension of the law. We however wish to start from section 22 itself which states that "an affected person may apply to a court for an orcle_r_. " We are not aware of any application that is made by filing a writ of summons. Ordinarily, a writ of summons is accompanied by a thereby presupposing contentious issues resolvable by trial. --- statement of claim Secondly, an order of the Court is :.obtainable at chambers without a trial. It is therefore our considered opinion that even going by section 22(1) alone, we have a clear indication of the envisaged mode of commencement. We however, also find the case of Chishala and others v Laston Geoffrey Mwale among others very clear in so far as it gives meaning to Order 6 rule 1 of the High Court Rules. What comes out clearly from that judgment is that to employ originating summons to commence proceeding, one must sfww that it is permitted under a rule or statute or it is a matter disposable at chambers. We have already shown that in this case section 22{1} envisages commencement by originating summons. Secondly it is noted that the matter is capable of disposal at chambers. However, because Order XXX rule 11 of the High Court Rules is couched in a manner that does not specifically catch the spirit of s ection 22 (1) of the Corporate Insolvency Act, its extension to the "law and practice for the time being observe·t{ ·in England and applicable to Zambia", beckons the aid of Order 5 rule 3 of the Rules of the Supreme Court 1999 edition which provides as follows; R3 "Proceedings by which an application is to be made to the High Court or a judge thereof under any Act must be began by Originating Summons except where by these rules or by or under any Act the application in question is expressly required or authorized to be made by some other means. This rule does not apply to an application made in pending proceedings." This rule expressly catches the spirit of Section 22 of the Corporate Insolvency Act which provides for an application to be made to the High Court. We therefore uphold the learned Judge's decision and find no merit in this ground and dismiss it accordingly." (Emphasis added) 1.5 The said decision of the Court: of Appeal was upheld by the Supreme Court in Chimanga Changa Ltd. v Export Trading Ltd. - Appeal No. 3 of 2022. 1.6 Moving on to the suggested second ground of appeal. The submissions by the Respondents show lack of appreciation of the essence of mediation. Mediation is not a by-the-way process in litigation, which Counsel can simply attend as a mere formality. Instead, it is a cardinal branch of the dispute resolution services offered by the Judiciary. 1.7 That is why even the mediation order expressed that the parties and their advocates (if any) were ordered to attend and that institutional litigants ought to have a representative present with authority to settle the case (if it came to it). R4 1.8 The importance of alternative forms of dispute resolution is so much so that even the Constitution of Zambia, in article 118(2)(d) enjoins this Court to promote it. 1.9 Accordingly, I disagree with the casual submission by the Respondents that the mere presence of their Counsel at mediation was good enough. Instead, I agree with the submission by the Petitioner that the presence of the Respondents' Counsel without any instn1ctions from the Respondents was as good as absence altogether. In any event, it was also in breach of the mediation order that required the parties to attend too, not just their Counsel. 1.10 Further, I did in the subject ruling cite a specific rule of Court and binding jurisprudence to guide the objective exercise of the discretion on costs. Furthermore, considering the subversive conduct of the Respondents towards the mediation, the bare denial of costs was actually lenient. I say so because under Order 53 Rule 8(3) of the High Court Rules, this Court could have gone as far as condemning the Respondents to bear the entire costs of the dismissed action, given their conduct. RS 1.11 Consequently, I am unable to conclude that there are any realistic prospects of success of the intended appeal. This goes to the heart of the application. 1.12 The application for leave to appeal clearly lacks merit and is denied. 1.13 As for the issue of costs of this application, the petition herein terminated in limine upon successful application by the Respondents. If the intended appeal succeeded it would not change that outcome but only the methodology. Thus, I consider this expedition by the Respondents as an abuse of process of the Court, as rightly flagged by the Petitioner. This Court is duty bound to prevent its machinery from being hijacked by litigants for improper purposes. l.14Accordingly, it is is appropriate, fair and just to condemn the Respondents to bear the Petitioner's costs of this application. The .. said costs are payable forthw ith s ince the petition is at an end and they shall be t;; default of aglv(:l Dated at Lusaka this --------------- d --- -------------------------------------2024 K. CHENDA Judge of The High Court R6