Mutuwila Farms Ltd v Nortje (SCZ 28 of 2010) [2010] ZMSC 7 (19 October 2010)

Supreme Court Judgment No. 28 of 2010 IN THE SUPREME COURT OF ZAMBIA APPEAL NO. 47/2010 HOLDEN AT LUSAKA (CIVIL JURISDICTION) BETWEEN MUTUWILA FARMS LIMITED APPELLANT AND JOHAN NORTJE RESPONDENT CORAM: MAMBILIMA, DCJ, CHIRWA, MWANAMWAMBWA, JJS / On 22nd June 2010 and 19th October 2010 For the Appellant: N. NCHITO, of MNB, appearing on behalf of Mr. R. S1MEZA of Simeza Sangwa and Associates. For the Respondent: Mrs. D. FINDLAY of P. M. Mulikita and Partners ___________________________ JUDGMENT_______________ MAMBILIMA, DCJ delivered the Judgment of the Court. AUTHORITIES REFERRED TO: 1. SHELL & BP ZAMBIA LTD VS CONIDARIS & OTHERS (1974) ZR 291 2. TURNKEY PROPERTIES V LUSAKA WEST DEVELOPMENT COMPANY & OTHERS (1984) ZR85 3. HARTON NDOVE V NATIONAL EDUCATION COUNCIL OF ZAMBIA (1980) ZR 184 4. NINEMIA MARITIME CORPORATION V TRAVE SCHIFFAHARTGESESSCHAFT M.b. H and CO. K. G. (1994) 1 ALL ER 398, at pages 406 and 419 5. R. V. GOVERNOR OF BRIXTON (1992) ALL E. R. 127 6. CHARLES LUKOLONGO AND OTHERS VS THE PEOPLE (1986) ZR 115 7. AMERICAN CYNAMIUD COMPANY VS ETHICAN LTRD (1975) A. C. 396 608 8. MAREVA COMPANI NAVIERA SA V INTERNATIONAL BULK CARRIERS SA (1980) 1 ALL E. R. 213 9. THIRD CHANDRIS SHIPPING CORP V UNIMARINE SA, THE PYTHIA (1979) 2 ALL ER 972 AT 985 This appeal is from an interlocutory Ruling, given by the High Court, granting an interlocutory injunction to the Respondent in which it was ordered that the Respondent be restrained from procuring or effecting payment relating to the balance of proceeds from the sale of Farm No. 3278, Kabwe, by the Appellant to a company called Africa Crops Limited, until after the determination of the main cause. We will refer to the Appellant as the Defendant and the Respondent as the Plaintiff, which is what they are in the court below. From the pleadings on record, the Plaintiff took out a Writ of Summons, accompanied by a Statement of Claim, in which he sought in the main, payment of a sum of US$58,900. He averred that this amount was the balance of accrued gratuity, to which he was entitled under a contract of employment dated 1st February 2002, between him and the Defendant. According to the Statement of Claim, the Plaintiff was employed as a General Manager by the 609 Defendant at a monthly salary of US$3,000, for a period of five years. Under the terms of the contract of employment, the Plaintiff was to receive 20% gratuity of the total basic pay during the period of employment. It was averred that upon expiry of the five year term, there was a verbal agreement between the parties to extend the employment contract for a further period of one year, on the same terms and conditions. According to the Plaintiff, the Defendant failed to pay him his full monthly salary due to financial difficulties. The Plaintiff accepted to be paid US$500 per month for a period of nine months until such time that the Defendant was able to make full payment of the outstanding salaries. At the end of the nine months, US $27,000 accrued in unpaid salaries, together with a sum of US $4,500 as gratuity. In February 2008, the parties mutually agreed that the Plaintiff would cease employment and the accumulated amount due to him would be paid from the proceeds of the sale of Farm No. 3278 Kabwe, belonging to the Defendant. The Plaintiff averred that of the amount that accrued, only US$5,000 has been paid to him, 610 leaving a balance of US$58,900. The Plaintiff is claiming this amount, together with interest and any other relief that the Court may deem fit. In November 2009, the Plaintiff filed an ex parte summons for an order of injunction, to restrain the Defendant from procuring or effecting payment relating to the balance of the proceeds from the sale of the farm to Africa Crops Limited. In the affidavit in support of the summons for an order of interlocutory injunction, the Plaintiff deposed that the farm had been sold to Africa Crops Limited and that a balance of the purchase price was yet to be paid to the Defendant, by way of a direct bank transfer into the Defendant’s bank account which is out of the jurisdiction of the Court. He deposed further that apart from the farm, the Defendant had no other moveable or immoveable assets in this jurisdiction. He believed that the Defendant’s managing director and shareholders, intended to relocate outside the jurisdiction of the Court after the sale of the farm to Africa Crops Limited. He expressed the fear that should the balance of the purchase price be paid by Africa Crops Limited directly to the Defendant’s account 611 outside the jurisdiction of the Court, there would be no other assets or property available to satisfy any judgment that the High Court may pass in favour of the Plaintiff. He therefore sought an interlocutory injunction to prevent the balance of the proceeds from the sale of the farm from being paid to the Defendant until after the determination of the case. The Court below granted an interim Order pending the hearing of the application inter parte. In the said ex parte Order, it was ordered that: "The Defendant whether by itself, its servants, its agents or whosoever otherwise, whether directly or constructively until further order of the court BE restrained from procuring or effecting payment relating to the balance of the proceeds from the sale of Farm No. 3278, Kabwe by the Defendant to Africa Crops Limited, until further order of this court.” Before the hearing of the matter inter parte, an affidavit in opposition, sworn by one, Heather Dawn Bowles HUNT, on behalf of the Defendant, was filed. She described herself as one of the directors and shareholders of the Defendant Company. She deposed inter alia, that contrary to the assertion by the Plaintiff in the affidavit in support; the directors of the Defendant had absolutely no plans of leaving the jurisdiction of the court. She 612 went on to state that one of the conditions agreed upon for the sale of the farm to Africa Crops Limited, was that they would continue to stay at the farm house for as long as they wanted. She deposed further that they have neither relocated out of the jurisdiction of the court nor do they intend to do so, save for the occasional times when they travel outside Zambia to visit their children in Australia and the United Kingdom. In her Ruling, the learned Judge in the court below, noted that the Plaintiffs substantive claim was for gratuity and salary arrears and that the Defendant had admitted the claim and advanced part payment to the Plaintiff. She also noted that the only source of income available to the Defendant to enable them to pay the Plaintiff his terminal benefits was from the proceeds of the sale of Farm 3278 Kabwe, to Africa Crops Limited. The injunction was intended to block the payment of these monies to the Defendant. In her Ruling, the Judge was of the view that the application before her was for a mareva injunction. According to the Judge, there was a well founded fear in the mind of the Plaintiff that once the Defendant is paid the balance of the purchase price on the sale 613 of the farm, nothing would remain to satisfy the debt to the Plaintiff should the judgment be in his favour. On the argument by the shareholders of the Defendant, that they are permanently resident in Zambia and had no intention of leaving the jurisdiction on the court, the Judge stated that the Defendants ought to have demonstrated, through a binding agreement, that when they are paid the balance from the proceeds of the sale of the farm; they would pay the Plaintiff the balance of his gratuity and other benefit. She noted that the offer by the Defendant to make the payment on a without prejudiced basis was not binding. The Judge observed that a mareva injunction is designed to prevent the Defendant from removing assets from the jurisdiction of the court which may be the subject of attachment, in the event that the court found in favour of the Plaintiff. On the assertion by the Defendant that the fear by the Plaintiff that the Defendant will be paid the balance on the sale of the farm outside this jurisdiction, was speculative; the Judge was satisfied that this fear was well founded because the Plaintiff did not know the intention of the Defendant and what it intended to do with the proceeds from the 614 sale of the farm. She stated that it was not necessary, in a mareva injunction, that the Plaintiff must show a proprietary claim, because such an injunction goes beyond and enables the court to grant an injunction to restrain a Defendant from disposing of property or merely dealing with it. She stated further that since the two shareholders of the Defendant are husband and wife, there was a possibility that they may thwart the orders that the court may make in the event that the case was decided in favour of the Plaintiff. On this premise, she confirmed the ex parte order of the injunction earlier granted and ordered that it be in force until the determination of the main matter. The Defendant has now appealed to this Court citing three grounds of appeal. The first ground is that: The learned Judge in the court below erred in law and fact when he granted the order of injunction without considering the question of damages being an adequate remedy. In support of this ground, the Appellant relied on the case of SHELL BP ZAMBIA LTD VS CONIDARIS AND OTHERS1 in which this Court stated: “a court will not generally grant an interlocutory injunction unless the right to relief is clear and unless the injunction is necessary to 615 protect the plaintiff from irreparable injury; mere inconvenience is not enough. Irreparable injury means injury which is substantial and can never be adequately remedied or atoned for by damages, not injury which cannot possibly be repaired.” The learned Counsel for the Defendant, in his written heads of arguments, submitted that the Plaintiffs claim is for a liquidation amount of US$58,900 plus a month’s salary. In this vein, damages would be an adequate remedy. He pointed out, relying on the case of TURNKEY PROPERTIES VS LUSAKA WEST DEVELOPMENT & OTHERS2, that the universal remedy for breach of contract is damages. He submitted that the Plaintiff should have demonstrated not only that his right to relief was clear, but that an injunction was necessary to protect him from irreparable injury. He also referred us to our decision in the case of HARTON NDOVE VS NATIONAL EDUCATION COUNCIL OF ZAMBIA3 in which we held that if damages are available, no injunction will normally be granted to the Applicant, no matter how strong his case may appear. It was his view that regardless of strength of the Plaintiffs case, an injunction to restrain the Defendant from completing its contract of sale of the farm and receiving the balance of money owing from a third party, who is not privy to these proceedings, is legally 616 unjustified and leads the Defendant to be in breach of its contractual obligations with the said third party. In response to the first ground of appeal, Mrs. FINDLAY, for the Plaintiff, has submitted that notwithstanding the well known principles relating to ordinary injunctions, as expounded in the various authorities, which specified that where damages will be an adequate remedy, an ordinary injunction is inappropriate; the very purpose of a mareva injunction is such that it prevents a Defendant from committing abuse, by dissipating or hiding assets from the Plaintiff which may be lawfully attached for the purpose of satisfying a judgment that is likely to be given in his favour. She argued that even if damages were to be awarded in such a situation, one would not be able to recover them if the assets were allowed to be dealt with in such a way as to put them beyond the reach of the Plaintiff. She submitted that the Judge in the Court below was therefore on firm ground, to have held that principles applicable to ordinary injunctions were of no effect when considering the grant of a mareva injunction. 617 Mrs. FINDLAY referred us to a number of authorities, expounding the principles upon which a mareva injunction can be granted. One of them is that there should be a real risk of dissipation or hiding of assets which would render the Plaintiffs relief nugatoiy. She referred us to the case of NINEMIA MARITIME CORPORATION VS TRAVE SCHIFFAHRTGESELLSCHAFT m.b. H and Co. K. G.4 in which the Court observed that: “.... The test to be applied by the court when deciding to exercise its statutory discretion to grant a mareva injunction to a Plaintiff pursuant to S37(a) of the Supreme Court Act 1981 whenever it appears to the court to be j'ust and convenient to do so is whether, after the Plaintiff has shown that he has at least a good arguable case and after considering the whole of the evidence before the court, the refusal of a mareva injunction would involve a real risk that a Judgment or award in the Plaintiffs favour would remain unsatisfied because of the Defendant’s removal of assets from the Jurisdiction or dissipation of assets within the Jurisdiction ” It is the submission of Counsel that a mareva injunction extends, not only to a debt or liquidated demand, but to any actions or claims for damages for breach of contract. While conceding that an injunction should only be granted where the Applicant has demonstrated that he will suffer irreparable injury, it is Counsel’s view that irreparable injury can occur if the Defendant is allowed to deal with its only remaining asset in such a way as to place it beyond the reach of the Plaintiff, and thus thwart any judgment that will be made in his favour. The 2nd ground of appeal is that:- “the learned Judge in the court below erred in law and fact when she took the view that the proceeds from the sale of the farm were likely to be taken out of the jurisdiction and thus the fear by the Plaintiff was well founded and not speculative.” The learned Counsel for the Defendant submitted, relying on the affidavit in opposition to the application for an order of injunction, that the directors and shareholders of the Defendant Company are very much resident in Zambia and have continued to stay at the farm house on the property that was sold to African Crops Limited. He cited the case of R V GOVERNOR OF BRIXTON5 in which the view that courts must generally not act upon speculation was upheld. He also cited the case of CHARLES LUKOLONGO & OTHERS VS THE PEOPLE6 in which this court frowned upon tendencies to tempt courts towards a path of speculation. He contended, that there was no basis upon which the court below should have held that the Plaintiffs fears as expressed, were well founded, other than being led on the speculative path 619 because no evidence was tendered to show that the directors of the Appellant company were leaving the country. In the alternative, Counsel has argued that if the fears expressed by the Plaintiff were genuine, they would at first trigger an application for an interim attachment of property under Order 26 Rule 1 of the High Court Rules. The Rule states “If the Defendant, with intent to obstruct or delay the execution of any decree that may be passed against him, is about to dispose off his property, or to remove any such property from the jurisdiction, the Plaintiff may apply to a Judge to call upon the Defendant to furnish sufficient security to fulfill any decree that may be made against him in the suit. On his failing to give such security, the Court may direct that any property, belonging to the Defendant, shall be attached until further Orders.” According to Counsel, the conditions precedent in the Rule are what the Plaintiff sought to rely upon for his application for an injunction. It was his view that the Plaintiff should have applied to Court under this Rule. In response to the second ground of appeal, the learned Counsel for the Plaintiff submitted that the Court below was on firm ground when it noted that the Plaintiffs fear was well founded. According to her, this can be seen when the judgment of the Court is read as a whole. She stated that the Judge in her Ruling, 620 acknowledged that any reasonable person could be worried, when there are no other assets available to him other than the proceeds from the sale of a farm that would be at the disposal of the Defendant. Counsel argued that in any event, a mareva injunction is available where the Applicant demonstrates that there is a real danger of the Defendant dissipating his assets to make himself judgment proof and it was therefore not necessary to demonstrate that the Defendant intended to transfer the proceeds out of the jurisdiction or that the shareholders intended to relocate out of the jurisdiction. Counsel further submitted that a mareva injunction is applicable to assets within and outside the jurisdiction. It is meant to restrain the removal of such assets from the jurisdiction, or otherwise dealing with them within the jurisdiction. She argued that as such, a mareva injunction has immediate effect on every asset of the Defendant covered by the injunction because it is a method of attachment which operates in ‘rem.’ Counsel submitted that in the case at hand, it is undisputed that the proceeds from the sale of the farm is the Appellant’s only 621 available asset; the said proceeds are to be paid to the Appellant’s shareholders; the farm is the Respondent’s sole business which has been disposed of; and lastly, that the Plaintiff is owed money by the Appellant which debt has been admitted. Counsel submitted that from these facts, it can be concluded that if the Defendant’s only available asset is paid out to the shareholders, the Defendant would have no further assets available and would thus, have taken steps to render any possible judgment meaningless. On the argument that the Plaintiff should have proceeded by way of Order 26 Rule 1 of the High Court Rules; the learned Counsel for the Appellant has submitted that under this Order, a Plaintiff must first call upon the Defendant to furnish security sufficient to fulfill any decree made against him and it is only upon failure by the Defendant to give such security, that the Court can direct that the property belonging to the Defendant shall be attached. It is the argument of Counsel that in trying to comply with the steps outlined in this Order, an Applicant would not obtain an immediate order addressing urgent circumstances. She also argued that upon receiving such a notice, the Defendant may, in 622 the interim, deal with the assets in such a way as to place them beyond the reach of the Plaintiff. It is her view that a mareva injunction, on the other hand, is a swift and immediate remedy that would prevent or restrain a Defendant from immediately dealing with the asset in such a way as to dissipate it or dispose of it. The last ground of appeal is that: “The learned Judge erred in law and fact when she took the view that the application was for a mareva injunction and that the authorities cited by the Appellant were of effect to the application.” In arguing this ground of appeal, Counsel invited us to peruse the summons relating to the application for an injunction, which appears on page 17 of the record of appeal. He submitted that the application for an injunction was made pursuant to Order 29 of the Rules of the Supreme Court (R. S. C.). The Plaintiff did not include a claim for an injunction in his writ of summons. This, according to Counsel, was not fatal, because a prayer for an injunction need not be included in the writ. He however argued that Rule 1A/2 of Order 29 states that an injunction is granted by the Court to restrain the commission of a wrongful act or continous of some omission. It is his view therefore Order 29 Rule 1 R. S. C. envisaged injunctions 623 that were meant to curb some form of wrong doing on the part of the Defendant. He contended that in the affidavit in support of the application for an injunction, the Plaintiff did not disclose, neither did he argue that the completion of the sale of the Defendant’s farm to African Crops Limited was a wrongful act. According to Counsel, it was not clear what the Order of injunction, in its current form, sought to achieve or how it would be enforced against a third party who is not a party to these proceedings. Counsel for the Defendant further submitted that the Plaintiffs claims in the court below are for gratuity and alleged salary arrears. These, in his view, are totally unconnected to the interim relief sought of essentially restraining a third party, African Crops Limited, from completing its obligations on a conveyance transaction which had already been concluded before the suit wTas filed. He argued that consequently, the Court below erred in law, when it held that the application before it was for a mareva injunction and discarded the authorities that were cited by the Defendant as being irrelevant to that application. He submitted that the application in this case was specifically made under Order 624 29, Rule 1, R. S. C. which envisage some wrong doing on the part of the Respondent to the application. According to Counsel, the Order to be given under the said Order 29 is meant to maintain the status quo until the rights of the parties are determined in the matter. He contended that the application by the Plaintiff was for an ordinary injunction and not for a mareva injunction as held by the lower Court. Counsel further argued that even if it was conceded, that the application by the Plaintiff was for a mareva injunction, Order 29/L/37 R. S. C. describes a mareva injunction as being a remedy which exists for the purpose of restraining a potential judgment debtor from committing the abuse of dissipating or hiding assets that the judgment creditor might lawfully attach for the purpose of satisfying a judgment given in favour of the Plaintiff. Counsel submitted that an applicant in such a case must demonstrate by solid evidence that there is real risk that assets will be dissipated so that they are not available or traceable when judgment is given. He went on to state that in this case, no evidence exists of such risks because the sale of the farm was contracted long before the action 625 against the Defendant. Counsel also pointed out that contrary to the provisions of Order 29/L/37, the Plaintiff in his application before the court below, did not give any undertaking towards the innocent party, Africa Crops Limited, with respect to any expenses it may reasonably incur, as a result of an injunction Order which restrains it from making a payment order in time. Counsel for the Defendant further submitted that a mareva injunction should only freeze assets that do not exceed the value of the Plaintiffs claim. He stated that in this case, the entire proceeds of the farm which is more than US$1 million have been locked by the injunction that was granted by the court below without limiting it to the value sufficient to satisfy the Respondent’s claim of US$58,900. In response to the last ground of appeal, the learned Counsel for the Plaintiff has submitted that contrary to the submission made on behalf of the Defendant, Order 29 Rule 1 R. S. C. does not mention or specify whether an injunction granted under this Order should be prohibitory or mandatory; neither does it provide or specify that the restraint must be for a wrongful act. She stated 626 that as the Court below rightly pointed out, it is only in a normal application for an injunction that a Plaintiff must show proprietary claim. In the case of a mareva injunction; it goes beyond and enables the Court to grant an injunction to restrain a defendant from disposing of property or dealing in assets in which the Plaintiff has no proprietary claim. Counsel submitted that in this case, the Plaintiff fulfilled the requirements for a grant of an injunction and made a full disclosure of relevant facts. These facts show that the Defendant had assets within the jurisdiction which are at risk of being placed beyond the reach of the Plaintiff in the event of obtaining a favourable judgment. She contended that the Judge in the lower court was on firm ground, when she confirmed the ex parte Order of injunction as it was clear from the reasons stated that the grant of the injunction was right and just in the circumstances. After taking into account all the circumstances at hand, the Court did note that if the injunction was not granted, it would not be possible for the Plaintiff to obtain judgment fully or at all and Plaintiff was going to suffer prejudice. 627 We have carefully considered the submissions of Counsel, the judgment of the court below, and the affidavit evidence that was before the lower court. We propose to deal with the first and third grounds of appeal together. It is our view that the two grounds raise the same issue; that is whether the principles at play in the grant of ordinary interlocutory injunctions do also apply to prejudgment mareva orders. The law with regard to the grant of interlocutory injunctions is well settled after the decision in the cerebrated case of AMERICAN CYANAMID CO. VS ETHICAN LIMITED7. The principles laid down in this case are still good law. Our own decisions in the cases of SHELL & BP ZAMBIA LIMITED1; TURNKEY PROPERTIES2; and HARTON NDOVE3 cited to us by the learned Counsel for the Defendant endorse the Cyanamid principles and have added to our jurisprudence on injunctions. One of the cardinal principle in the grant of an interlocutory injunction is that an applicant must show, inter alia, that he has an arguable case and that if he will not be granted the relief, he will suffer from irreparable injury; that is injury that cannot be atoned by damages. We can glean, from the 628 submissions made on behalf of the Plaintiff that she has no quarrel with these principles. Her position is that what she sought was a mareva injunction which, in the main, seeks to prevent a Defendant from transferring his assets outside the jurisdiction of the Court or dissipating them so as to thwart execution of any judgment that may be entered against him. We get the impression that the court below was alive to the general principles governing the grant of interlocutory injunctions. The learned Judge noted that the Plaintiffs substantive claim was for gratuity and salary arrears; a claim that was admitted and the Defendant had made part payment. The court noted further that the only source of income available to the Defendant to enable him pay the Plaintiff his terminal benefits was from the proceeds of the sale of Farm No. 3278 Kabwe. The court went on to opine that this had raised ‘a well founded fear’ that the shareholders of the Defendant Company, who are British nationals may direct the payment of the balance owing on the sale of the farm, outside the jurisdiction of the Court. On this premise, the court granted the mareva injunction. 629 A mareva injunction is a unique remedy that can be granted either before or after judgment. When granted before judgment, the court, apart from ascertaining whether the Plaintiff has a good arguable case, is also concerned with protecting the assets from dissipation so as not to render enforcement of a judgment nugatory. In such a case, the Court looks beyond the issue of adequacy of damages to atone for breach. On this point, the learned Judge in the Court below stated as follows “...although Counsel for the Defendant has argued his case by applying principles relating to injunctions he has cited cases which are of no effect to this application, it is my view and I agree with the Plaintiffs Counsel that a mareva injunction is designed to prevent the Defendant from removing assets from the jurisdiction. ” This passage shows that the Judge was alive to the principles applicable to ordinary injunctions as well as mareva injunctions. When it comes to mareva injunctions, the principle of adequacy of damages takes a back seat. The possibility by a defendant to hide or dissipate assets so as to make himself judgment proof in the event of an unfavourable judgment takes the front seat. An asset can be in form of money or chattels. Authorities cited propounding 630 on the damages being an adequate remedy would be clearly irrelevant. The issue that would need to be resolved, in our view, is whether the Plaintiff, on the evidence placed before the Court, was entitled to a mareva injunction. It is our view that in its observations, the court below did not stray from applicable norms. The first and third grounds of appeal cannot therefore succeed. Coming to the second ground of appeal, the learned Judge in the court below accepted the contention by the Plaintiff, that there was a danger that the directors of the Defendant Company may direct the balance of the proceeds from the sale of their sole asset to be taken out of jurisdiction. As to the source of this fear, paragraphs 8 and 9 of the Plaintiffs affidavit in support of the summons for an order of injunction, state the following: “8. That I further verily believe that the Defendant’s Managing Directors and shareholders have relocated out of jurisdiction of the Court, as their residential property was part of the Defendant’s farm that was sold to Africa Crops Limited and as such are no longer in the jurisdiction of the Court. 9. That in the circumstances I believe that should the balance of the purchase price be paid by Africa Crops Limited directly to the Defendant, there will be no other assets or property available to obtain satisfaction of any judgment that this Honourable Court may pass in favour of the Plaintiff.” 631 It would appear, from these two paragraphs, that the belief by the Plaintiff, that the directors and shareholders of the Defendant may have relocated out of jurisdiction is anchored on the fact that their residence is part of the property that was sold to Africa Crops Limited. It is the Plaintiff’s further belief that should the balance of the purchase price on the farm be paid directly to the Defendant outside the jurisdiction of the Court, there will be no other asset available to satisfy any judgment that may be obtained in his favour. The mareva injunction, as we now know it, was coined as such, in the case of MAREVA COMPANIA NAVIERA SA V INTERNATIONAL BULKCARRIERS SA8. The Court accepted, in that case that it had jurisdiction to grant an injunction to a plaintiff, to preclude a defendant from removing his assets from the jurisdiction, when there is a danger that the debtor may dispose of his assets to defeat the debt before judgment. But, as Lord DENNING stated, in the case of THIRD CHANDRIS SHIPPING CORP VS UNIMARINE SA9 “The Plaintiff should give some grounds for believing that there is a risk of the assets being 632 removed before the Judgment or award is satisfied. The mere fact that the Defendant is abroad is not enough. ” MUSTILL J, in the case of NINEMIA MARITIME CORP V TRAVE SCHIFFAHRTSGESELLSCHAFT M.b. H & Co4 put it this way:- “...certain themes can be seen to run through the cases. It is not enough for the Plaintiff to assert that the assets will be dissipated. He must demonstrate this by solid evidence. This evidence may take different forms. It may consist of direct evidence that the Defendant has previously acted in a way which shows that his probity is not to be relied on. Or the Plaintiff may show what type of company the Defendant is...so as to raise the inference that the company is not to be relied upon.” On appeal, KERR, LJ stated:- “...as the law strands, this jurisdiction cannot be invoked for the purpose of providing Plaintiffs with security for claims, even when these appear likely to succeed....and even when there is no reason to suppose that an order for an injunction, or the provision of some substitute security by the Defendants would cause any real hardship to the Defendant. ” In this case, a director and shareholder of the Defendant Company deposed, in opposing the application for an Order of interim injunction, inter alia, that they have not relocated out of the jurisdiction of the Court and neither do they intend to do so. She stated that they still reside in the farmhouse and they have been 633 allowed to do so for as long as they like. There is no affidavit in reply, to counteract the Defendant’s position. Apart from the assertions in the affidavit in support, that the directors and shareholders of the Defendant have relocated out of jurisdiction, there is no evidence provided by the Plaintiff to support his belief. It is also not clear how the Plaintiff arrived at the conclusion that these directors did not intend to reside within the jurisdiction other than the assertion that their residential house is comprised in the farm that was sold. It is our view that the facts before the lower court did not sustain the fear that the Defendant would dissipate its assets. The Plaintiff did not prove that there was a real likelihood of the Defendant doing so. On the evidence before the lower court, it is clear that the Plaintiff intended to use the injunction as security for his claim against the Defendant. That is not the objective of a mareva injunction. We agree that the Judge in the court below erred, when she held that the Plaintiffs fear, that there the Defendant was likely to take the proceeds from the sale of the farm out of jurisdiction was 634 well founded. The fear was unsubstantiated and based on assumptions. If anything, the injunction granted was self defeating and vague. It restrained the Defendant “...from ‘procuring or effecting payment’ relating to the balance of proceeds from the sale of Farm No. 3278 Kabwe by the Defendant to Africa Crops Limited.” (underlining and emphasis ours). The facts on the ground are that the Defendant was supposed to receive money. This is different from “procuring and effecting payment.” Obviously, in the manner that it is couched, this injunction cannot be enforced and serves no useful purpose. It seeks, in unclear terms, to bind a third party and yet has no penal notice and no undertaking as to damages. The second ground of appeal therefore succeeds. The mareva injunction granted by the court below is hereby set aside. The net result is that this appeal is allowed. Since two of the grounds of appeal have been dismissed, we direct that each party will bear its own costs. I. C. Mambilima DEPUTY CHIEF JUSTICE DJ<. Chirwa SUPREME COURT JUDGE 29