Orix Holdings Limited v Daewoo Engineering and Construction Limited (2017/HPC/0343) [2020] ZMHC 432 (22 September 2020)

I IN THE HIGH COURT FOR ZAMBIA AT THE COMMJER. CJIAL REGISTRY HOLDEN AT LUSAKA (Ciuil Jurisdiction) BETWEEN: 2017/HPC/0343 ORIX HOLDINGS LIMITED PLAINTIFF AND DAEWOO ENGINEERING AND CONSTRUCTION LIMITED DEFENDANT CORAM: The Honourable Lady Justice Dr. W. S. Mwenda in Chambers at Lusaka this 22nd day of September, 2020 For the Plaintiff Mr. M. l\llutemwa of Messrs. Mutemwa Chambers For the Defendant: Mr. R. Petersen of Messrs. Chibesakunda and Company RULING Cases referred to: 1) Mareva Compania Naviera SA v. International Bulk Carriers SA {1980} 1 All ER 213. 2) Third Chandris Shipping Corporation and Others v. Unimarine SA [1979] QB 645. 3) Ninemia Maritime Corp v. Trave Schiffahrtsgesellschaft mbH & Co. [1984] 1 All ER 398. 4) Brink's Mat v. Elcombe [1988] 3 All ER 188. 5) National Bank of Sharja v. Dellborg, The Times, December, 1992 (CA). 6) Elektromotive Group v. Pan {2012] EWHC 2742 (QB). 7) Petros Phiri v. Daewoo Engineering and Construction Limited, 2017/HP/ 1669. ~ ..-.:- -,· I (t R2 8) 9) 10) 11) 12) 13) 14) 15) 16) 17) 18} 19) Fundo Soberano De Angola v. Dos Santos [2018J EWHC 2199 (Comm). Mutuwila Farms Limited v. Johan Nortje [201 OJ 3 Z. R. 88. Abbey Forwarding Limited v. Hone [201 OJ EWHC 1532 (Ch). Bellamano v. Ligure Lombardo Limited [1976J Z. R. 267. Enock Kavindele and Another v. Bologna Properties Limited and Another, 2013/ HP/ 0196 [2013J ZMHC 13. Beatrice Nyambe v. Barclays Bank Zambia Plc. [2008J 2 Z. R. 195. JOT Engineering Projects Limited v. Dangote Fertilizer Limited and Another [2014} EWCA Civ. 1348. National Bank Trust v. Yurov [2016} EWHC 1913 (Comm). Zambia Revenue Authority v. Post Newspapers, SCZ Appeal No. 36 of 2016. Candy v. Holyoake [2017J EWCA Civ 92 at paras. {49} - [54} Iraqi Ministry of Defence v. Arcepey Shipping Company SA (The Angel Bell) [1981] QB 65. Orwell Steel (Erection and Fabrication) Ltd v. Asphalt and Tarmac (U. K.) Ltd /1984} 1 W. L. R. 1097. Legislation referred to: 1. Order 2, rule 1 of the Rules of the Supreme Court of England and Wales, 1999 Edition (the White Book). 2. Practice Note 24/5/33 of Order 24 of the White Book. 3. Order 39, rule 1 of the High Court Rules, Chapter 27 of the Laws of Zambia. 4. Practice Note 29/ lA/33 of Order 29 of the White Book. 5. Practice Note 24/ 5/ 33 of Order 24 of the White Book. There are two applications before this Court. The first one is the Plaintiffs application for an order of Mareva injunction and the second one is the Defendant's application to discharge or vary the ex parte Order of Mareva injunction granted to the Plaintiff on 24th July, 2020. The two applications are interrelated and therefore, will be determined simultaneously. R3 The Plaintiff filed a Summons for an Order of Mareva Injunction Pending Appeal pursuant to Order 29 /L/35A of the Rules of the Supreme Court of England and Wales, 1999 Edition (the White Book) on 24th July, 2020 for an Order that: 1. The Defendant whether by itself, its servants or agents or any of them or otherwise howsoever be restrained from removing from the jurisdiction or in any way dealing with or diminishing the value of any assets whether held in its name or not and whether solely or jointly, pending determination of the Defendant's appeal. 11. The Defendant whether by itself, its servants or any of them or otherwise howsoever be restrained from disposing of, assigning, charging or otherwise dealing with any of its assets within the jurisdiction whether held in its own name or not and whether solely or jointly owned, pending determination of the Defendant's appeal. 111. The Plaintiff whether by itself, its servants or agents or any of r them or otherwise howsoever may and if need be take custody of any of the Defendant's assets for purposes of preservation for security reasons only pending determination of the Defendant's appeal. The Court granted the Plaintiff an ex parte Order of Mareva Injunction on 24th July, 2020 and that is the Order which the Plaintiff now seeks this Court to confirm. However, on 29th July, 2020, the Defendant issued an ex parte Summons for an Order to Discharge or Vary the ex parte Mareva injunction granted to the R4 Plaintiff. An ex parte Order varying the terms of the Mareva injunction was granted to the Defendant on the same date. The Summons for an Order of Mareva Injunction Pending Appeal was augmented by an Affidavit in Support and Skeleton Arguments in Support. The said Affidavit was deposed to by one Jeffrey Masauso Tembo, a director in the Plaintiff Company who averred that following the commencement of legal proceedings on 3 rd August, 2017, in the Commercial Registry of the High Court of Zambia, judgment was entered in the Plaintiffs favour on 27th May, 2020 for a straight debt of USD431,930.46 for materials, equipment and services ordered by the Defendant and supplied by the Plaintiff. The Defendant was also condemned to interest and costs. It was further deposed that on 2 nd June, 2020, the Defendant was granted a stay of execution of judgment by the High Court pending determination of the appeal lodged by the Defendant in the Court of Appeal for Zambia. The stay of execution was later discharged by an extempore ruling of the High Court on 15th June, 2020 for lack of merit and there being evidence before the Court f!4.~ that the Defendant was intending to auction its plant and equipment at the bridge project and also, there being no security deposit to cover the judgment debt. The High Court also found that since the Defendant was a foreign registered entity, there existed jurisdiction risk issues to enforce the judgment should the Defendant leave the Zambian jurisdiction. The deponent averred further, that on 16th June, 2020, the Court of Appeal of Zambia granted the Defendant an ex parte Order RS for Stay of Execution of the High Court judgment pending determination of the appeal and the Defendant, on its own volition and fearing enforcement of judgment, also caused to be paid into court by notice, the sum of USD431,930.46 being the principal judgment sum only. It was further deposed that the inter partes hearing of the application for stay took place on 30th June, 2020 and a ruling on the same is awaited. It was alleged, in addition, that following the inter partes hearing for stay of execution of judgment in the Court of Appeal on 30th June, 2020, the following critical developments have emerged which may make it impossible for the Plaintiff to obtain full satisfaction of the entire judgment debt or at all, namely; a} The deponent was advised by the Plaintiffs advocates that the notice to pay into court the sum of USD431,930.46 was paid into a Judiciary account in local currency for the amount of K7 ,688,362. 19 which at the current exchange rate of about USD 1= Kl8.32 , only amounts to USD419,670.42 resulting into an immediate exchange rate loss of USD12,260.03 from the judgment sum; b) The totality of judgment debt ordered to be paid by the trial court such as accrued interest amounting to USD211,989.45 to date, exchange rate differential loss of USD12, 260.03 1n total amounting to USD224,249.48 and costs at K3 ,000,000.00 remain unpaid and unsecured. A computation of accrued judgment sum interest, exchange rate difference R6 calculation and demand costs was produced as exhibit "JMT3". c) The Plaintiffs fears that the Defendant is intending to dispose of its assets in Zambia have now crystallised as evidenced by credible correspondence in its possession dated 16th July, 2020 authored by the Defendant's Kazungula Bridge Project engineers representing the Defendant's employers (the Governments of Zambia and Botswana), whose contents confirms that the Defendant is selling its assets in Zambia. Following this, the Defendant being a foreign registered entity from South Korea, is likely to move out of the jurisdiction once the sale of its assets is concluded and the Plaintiff will be unable to satisfy the enforcement of the full judgment debt. The Plaintiff produced as exhibit "JMT4", a document allegedly confirming the sale of the Defendant's assets in Zambia at the Kazungula Bridge Project Site. It was contended that there is conclusive evidence in exhibit "JMT4" of the ongoing sale of assets, which is substantiated by the f' Defendant's own correspondences to its employer dated 15th May, 2020 and 28th October, 2019 confirming its planned completion and demobilisation of project assets and likely departure from the jurisdiction. As evidence of this averment, the Plaintiff produced the said correspondences to the employer and Affidavit in Support of ex parte Stay Application as exhibit "JMT5". It was further averred that in view of the on-going disposal of the Defendant's assets and the imminent departure from the R7 jurisdiction, the likelihood of the Plaintiff enforcing the judgment debt is non-existent as the Defendant is a company duly incorporated under the laws of the Republic of Korea, having its registered address at 75, Saemunan-ro, Jongno-gu, Seoul, Republic of Korea. That, the deponent has been advised by the Plaintiff's advocates on record, that Zambia and South Korea do not have any reciprocal enforcement regimes and mechanisms. It was deposed that it is clear from the above that the Plaintiff faces a real risk and it is likely, unless the Defendant is restrained by an order of this Court from disposing of the assets or moving them out of the jurisdiction, to be deprived the fruits of its judgment. It was deposed further, that the said assets intended to be disposed of are more particularly itemised in exhibit "JMT4" and it is requested that the assets be preserved and be in the Plaintiff's custody pending the ruling or determination of the appeal. That, in light of the foregoing material facts that have been disclosed, this is a proper case wherein this Court should exercise its discretion to grant the Mareva injunction for the detention, custody and f!'- preservation of the Defendant's assets pending the ruling for the stay of execution application or determination of the appeal. The application is opposed and in furtherance of that, the Defendant filed into Court on 29th July, 2020, a combined Affidavit in Opposition to Summons for Order of Mareva Injunction and in Support of ex parte Summons to Discharge or Vary ex parte Mareva Order of Injunction dated 24th July, 2020 and Skeleton Arguments. R8 The Affidavit in Opposition was deposed to by one Donchang Kim, the Project Coordinator in the employ of the Defendant. It was his evidence that on 27th July, 2020, he was served with a copy of an Order entitled "ex parte Order of Mareva Injunction Pending Appeal", whose service on him was duly acknowledged. When the Plaintiffs advocates served the ex parte Order of Mareva Injunction, they did not serve the Plaintiffs Affidavit in Support or Summons. However, the Defendant uplifted a copy of the Plaintiffs Affidavit in support of ex parte Summons for Order of Mareva Injunction Pending Appeal that was filed into court on 24th July, 2020. The deponent stated that he had seen the Plaintiffs Affidavit in Support deposed to by Jeffrey Masauso Tembo dated 24th July, 2020 and noted that Mr. Tembo made a number of factually incorrect or misleading statements. He averred that it is not correct that Justice E . L. Musona in his extempore ruling dated 15th June, 2020, held that there existed jurisdiction risk issues to enforce the judgment should the Defendant leave Zambia as alleged by Mr. Tembo. He claimed that after perusing the said ruling, it was his ~ belief that Justice Musona merely recorded that there were fears expressed by the Plaintiff that if the Defendant wrapped up its project in Zambia, the Plaintiff would have no way to enforce the judgment of the High Court. The deponent asserted further, that contrary to Mr. Tembo's averment that the Defendant on its own volition and fearing enforcement caused to be paid into court, by notice, the sum of USD 431,930.46, the payment was made in compliance with an tl' R9 order of the Court of Appeal. A Notice of Payment into Court under Order was produced as exhibit "DK3". Additionally, that it is not correct that the judgment interest amounts to USD 206,800.72 as alleged as no assessment has been done to determine the value of the interest. It was deposed that the payment made into court was in United States dollars, as evidenced by the proof of payment from the Defendant's Bank exhibited as "DK4". Further, that the deponent believes that the Judiciary maintains only a Zambian Kwacha account and the Defendant was provided with the details of this Zambian Kwacha account when it requested the Judiciary to confirm the bank details into which the payment into court was to be made. It was the deponent's belief that the amount paid into court equaled the Zambian Kwacha equivalent of USD431,930.46 as at the date that the payment was made. In respect of the Plaintiffs assertion that it 1s entitled to interest of USD211,989.45 on the judgment sum, the deponent averred that this is incorrect and that he was advised by the f!!4 Defendant's advocates, that Mr. Tembo at exhibit "JMT3" calculated interest using an interest rate that was not ordered by the Court. The deponent further asserted that the Plaintiffs speculation that the Defendant will move out of the jurisdiction once the assets are sold is incorrect as the Defendant is required to stay on site even after the handover and continue performing some work, as evidenced by the letter from the Kazungula Bridge Project RlO consultants, a copy of which was produced and marked exhibit "DK7" Responding to the allegation that the Defendant is in the process of selling its equipment, the deponent deposed that the document produced as "JMT4" was neither authored by the Defendant nor does it state a date that the alleged sale is set to take place. Further, that the letter from the Defendant dated 15th May, 2020, refers to a construction programme revision which projected (Ii a completion date at August, 2020 in line with industry practice that often sees the construction programme being updated and the completion date being revised. It was stated that the letter from the Defendant dated 15th October, 2019 does not confirm planned completion and demobilisation as alleged. That, instead, the letter confirms that certain work by the Defendant will continue even after the issuing of the Certificate of Completion. It was further averred that there is no ongoing sale of the Defendant's assets nor 1s there a risk that the Defendant is imminently departing Zambia, that on the contrary, the letter (!! produced as "JMTS" shows that the Defendant will at a minimum continue performing work on the Kazungula Bridge even after hand over of the certificate of completion. Further, that contrary to the Plaintiffs averments, the Defendant is in fact duly registered under the laws of Zambia, as evidenced by exhibit "DK8", being a copy of the certificate of registration. The deponent asserted further, that after having read Mr. Tembo's affidavit, he verily believes that there are facts that Mr. R11 Tembo did not bring to the attention of this Court which the deponent believes are material to the application by the Plaintiff, namely: a) That, Mr. Tembo did not inform the Court that the interest sums that he refers to in his Affidavit have never been assessed or agreed. Similarly, that the costs of K3,000,000.00 have never been agreed or taxed. b) That, Mr. Tembo did not tell the Court that the order that the Plaintiff sought required that the Defendant stop all its activities on the Kazungula Bridge Project, a development which would make completion of the Kazungula Bridge Project delayed or impossible. c) That, Mr. Tembo did not tell the Court that the Kazungula Bridge Project that he was looking to stop, by stopping the Defendant from working, is a joint project by the governments of the Republic of Zambia and the Republic of Botswana for the construction of a bridge across the Kazungula River, which bridge is intended for the benefit of the public of both those countries. d) That, Mr. Tembo did not tell the Court that the injunction the Plaintiff sought would have the effect of halting a state project. e) That, Mr. Tembo did not tell the Court that the Court of Appeal had given as a condition for its stay of execution, an order that the Defendant pay into court the sum of USO 431,930.46 and that the Defendant had complied with the Court's order. R12 f) That, Mr. Tembo did not produce documents which the deponent had produced which show that the surface repair works for the bridge deck shall continue beyond the official completion date and these are projected to be carried out from September to November, 2020. A copy of the Affidavit in Reply filed in the Court of Appeal was produced as exhibit "DKl0". The deponent asserted further, that he verily believes that the ex parte Order granted to the Plaintiff is particularly onerous and places extreme hardship on the Defendant as it requires, inter alia, that the Defendant stop all use of all its assets. In addition, the Order also allows the Plaintiff to take custody of the Defendant's assets. That, the impact of the ex parte Order is that it significantly prejudices the continued work by the Defendant. Further, that at paragraph (iii) of the said Order, the Plaintiff has been given permission to take custody of the Defendant's assets for security reasons; that he has been advised by the Defendant's advocates that a Mareva injunction is not intended to provide a plaintiff with security. The deponent stated further, that he believes that no prejudice will be suffered by the Plaintiff should the Mareva Order be discharged because in the event that the appellate court decides in the Plaintiff's favour, the Plaintiff will be able to recover the judgment sum together with interest. Further, that he has been advised that the penal notice at the second page of the ex parte Order does not comply with the rules of Court in respect of penal notices. It was also deposed that the Defendant R13 does not intend in any way to evade or prevent satisfaction of any judgment against it. That, any sale of the Defendant's assets cannot take place until after completion of works. The deponent averred that the Kazungula Bridge Project is expected to be handed over to the clients, that is, the governments of the Republics of Zambia and Botswana, soon. However, the Defendant will remain a viable business in Zambia not least because the contract between it and the government of the Republic of Zambia requires that after handover, there is a 728 days defect notification period, during which period the Defendant is obliged to remedy any defects notified. As evidence of this averment, the Defendant produced a copy of the extracts of the contract as "DKll". It was a verred, in addition, that the Defendant does not intend to evade payment of the judgment against it as evidenced by the payment into court of the full judgment sum by order of the Court of Appeal. That, the only reason why the Defendant could not pay into court any amounts in respect of interest or costs is because they were not assessed or taxed and there is no agreement. Further, that even though the Defendant will remain a viable business in Zambia, it is willing to pay into court the amounts claimed by the Plaintiff and interest and costs, on the condition that these sums are to be held until after the appeal is determined and if the appeal is determined in favour of the Plaintiff, then until conclusion of the assessment and taxation of the interest and costs. R14 In the Skeleton Arguments filed into court on 24th July, 2020, it was argued on behalf of the Plaintiff, that the Defendant was granted, and the Plaintiff opposed, an ex parte stay of execution of judgment on 16th June, 2020 pending the determination of the matter by the Court of Appeal and a ruling is awaited. Thus, the subject matter for which this injunction is sought is restrained under cause number CAZ/8/186/2020 in the Court of Appeal. It was further argued that it is in the interest of justice that this Court grant's the Plaintiff a Mareva injunction for the following reasons, namely: 1. The payment into court of K7,688,362.19 which is short of the judgment sum of USD431,930.46 due to current foreign exchange rate; 11. The non-payment and securing of the other judgment debt, namely, interest and costs; 111. The latest confirmation from the evidence obtained that the Defendant has been dishonest in its submissions in court about its intention to dispose of its assets in Zambia With regard to the jurisdiction of this Court to grant a Mareva injunction, it was submitted that Order 29, rule L sub rule 35 of the White Book clothes this Court with the power to grant Mareva injunctions whether pre-judgment or post-judgment and a Mareva injunction can be granted at any time. That, the Order also provides that an injunction may be granted after judgment in aid of R15 execution, where there are grounds for believing that the debtor intends to dispose of assets in order to avoid execution. It was submitted that the circumstances under which a Mareva injunction will be granted are: a) Where it appears to the Court to be just and convenient to so do (Order 29 /L/37). b) Where there are grounds for believing that the debtor intends to dispose of assets in order to avoid execution (Order 29/1/47). It was submitted further, that in the landmark case of Mareva Compania Navera SA v. International Bulk Carriers SA 1, Lord Denning MR held at page 215 in respect of instances where such injunctions can be granted as follows: "If it appears that the debt is due and owing, and there is a danger that the debtor may dispose of his assets so as to defeat it before judgment, the Court has jurisdiction in a proper case to grant an interlocutory injunction so as to prevent him disposing of those assets." It was argued that it is clear from the above Order and case, that the test for a Mareva injunction to be granted is that there must be a debt due and owing and there must exist a danger that the debtor may dissipate or dispose of his assets so as to defeat any judgment the court may grant in favour of the plaintiff. That, in casu, there is already a judgment in favour of the Plaintiff, save for the stay of execution pending determination of the appeal. It was submitted that the grounds upon which a Mareva injunction is sought are as follows: R16 1. It has been the Plaintiffs deposition in paragraph 8 (a) that as a result of the Defendant causing to pay into court the sum of K7,688,362.19 as opposed to the judgment sum of USD431,930.46, the Plaintiff is faced with a foreign exchange rate risk as the deposited sum converts to an amount of USD4 l 9,670.42, resulting into an immediate exchange rate loss or shortfall of USD12,260.03. 'I-· n. It is the Plaintiffs contention that the other judgment debt ordered to be paid by the trial court such as accrued interest and costs amounting to USD211,989.45 and K3,000,000.00, respectively, remain unpaid and unsecured by way of payment into court or other. 111. There is produced credible evidence that the Defendant 1s intending to dispose of its assets in Zambia as there 1s confirmation by the Defendant's consulting engineers for the Bridge Project (representing the employers, namely, the governments of the Republics of Zambia and Botswana), in the ~ contents of its correspondence of 16th July, 2020 that it is selling its assets in Zambia to the highest bidder among members of the public, as evidenced in exhibit "JMT4". 1v. There is evidence from the Defendant's own correspondences to their employers' representative, the bridge Consulting Engineer, dated 15th May, 2020 and 28th October, 2019, both confirming their planned completion and demobilisation as evidenced in the exhibits marked "JMTS." R17 v. It is evident that the Defendant has been dishonest in its affidavit submissions in the application to stay execution. The Defendant in its Affidavit to support the stay application claimed that they will remain a viable business in Zambia and that the Defendant's assets are still required because works are still on-going, and that it is not correct for the Plaintiff to assert that there will be a sale of the assets. However, there now exists solid evidence that the Defendant has been dishonest in its submissions as the exhibit marked "JMT4" irrefutably confirms the on-going sale of assets. It was contended that the application meets the first test of there being a debt that is due from a judgment decision. That, the payment into court is less by USD12,260.03. Further, that accrued interest and costs amounting to USD211,989.45 and K3,000,000.00, respectively, have not been paid into court or secured in any way. Furthermore, that the Plaintiffs fears about jurisdiction risk are real as the Defendant being a foreign entity registered in South Korea with imminent departure from the jurisdiction, makes it impossible to enforce any outstanding judgment d ebt. It was also argued that the second test has been met in that the evidence exhibited and marked "JMT4" is irrefutable and credible as the source of information is from the Defendant's consulting engineers. That, the Plaintiff's fears that the Defendant is about to dissipate or is disposing of assets and therefore, it may not be able to recover its full judgment debt, are real. It was R18 submitted that in the case of Third Chandris Shipping Corporation and Others v. Uni marine SA2, the court held as fallows: "The mere fact that a defendant having assets within the jurisdiction of the commercial court is a foreigner or a foreign corporation cannot, in my judgment, by itself justify the granting of a Mareva injunction. There must be facts from which the commercial court, like a prudent, sensible commercial man, can properly infer a danger of default if assets are removed from the jurisdiction ... " It was submitted additionally, that there are valid allegations of dishonesty raised by the Plaintiff. It was contended that the Defendant has clearly presented untruthful information about its continued operations in Zambia and therefore, lacks probity and honesty; and in the circumstances, the Plaintiff is correct to conclude that there is a real risk that the assets of the Defendant will be dissipated or disposed of should the Defendant not be restrained from selling the assets. It was submitted that in the English case of Ninemia Maritime Corp V. Trave Schiffahrtsgesellschaft mbH & Co3, it was held that: "It is not enough for the plaintiff to assert that the assets will be dissipated. He must demonstrate this by solid evidence ... 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 upon ... " It was submitted in conclusion, that the Plaintiff faces a real risk of difficulties in enforcement of its judgment debt in view of the fact that the Defendant is a foreign based entity that is likely to depart from the Zambian jurisdiction once it disposes of its assets. It was contended that since there is a lack of reciprocal enforcement regimes and mechanisms between Zambia and South Korea, which R19 1s the origin of the Defendant, this will make any enforcement of judgment impossible should the Defendant dispose of its assets and depart from the Zambian jurisdiction. Further, that in view of the unscrupulous behavior of the Defendant in wanting to covertly dispose of its assets in Zambia, the reliefs prayed for in the granting of the Mareva injunction are justified. In the combined Skeleton Arguments 1n Support of ex parte Summons to Discharge or Vary ex parte Mareva Order dated 24th {~ July, 2020 and in Opposition to Summons for Mareva Order, it was submitted on behalf of the Defendant, that since freezing injunctions are generally sought on an ex parte basis, the defendant in such circumstances does not have an opportunity to make representa tions on its own behalf and thus, the applicant owes a duty to the court to make a full and frank disclosure of all material facts to the court determining the application for the freezing injunction. It was submitted that this duty extends to the applicant's legal advisers. In this regard, the case of Brink's Mat v. Elcombe4, was cited where the court is reported to have stated as fallows at page 192 : "The material facts are those which it is material for the judge to know in dealing with the application as made: materiality is to be decided by the court and not by the assessment of the applicant or his legal advisers .. . " It was submitted that the applicant must make proper enquiries before making an application for a freezing order. The duty of disclosure therefore, applies not only to material facts known to the a pplicant but also to any additional facts which he R20 would have known if he had made such enquiries. Further, the extent of the enquiries which will be held to be proper and necessary depend on all the circumstances of the case, including the nature of the case which the applicant is making when he makes the application; the order for which the application is made and the probable effect of the order on the defendant; and the degree of legitimate urgency and the time available for the making of enquiries. That, it was held in National Bank of Sharja v. (~ Dellborg5, that material facts are those facts which enable the court to exercise its discretion on a proper basis, bearing in mind the inherent hardship and inconvenience of a freezing injunction. It was submitted further, that the test of materiality of a matter not disclosed is whether it would be relevant to the exercise of the court's discretion. Thus, a fact is material if it would have influenced the judge when deciding whether to make the order or deciding upon the terms upon which it should be made. The question of materiality is a matter for the court and not the subjective judgment of the applicant or his lawyers. This means that the applicant will need to draw the court's attention to all relevant information, even that which is adverse to the applicant's own case . It was contended that full disclosure is closely linked to fair presentation - the applicant must present the material facts in a fair manner so that the judge has: " .. . complete confidence in the thoroughness and the objectivity of those presenting the case for the applicant." (For this, reference was made to the case of Elektromotive Group v. Pan6). 0,._. R21 It was argued that in this case, at the time the Plaintiff sought the ex parte Order, it suppressed the following information: 1. That the interest sums have never been assessed or agreed; 2. The costs of K3,000,000.00 have never been agreed or taxed; 3. The order sought required that the Defendant stop all activities on the Kazungula Bridge Project, effectively delaying completion of the Kazungula Bridge Project or making it impossible; 4. The Kazungula Bridge Project that the Plaintiff was looking to stop is a joint project by the governments of the Republic of Zambia and Botswana for the construction of a bridge across the Kazungula River, which bridge is intended for the benefit of the public of both these countries; 5. The injunction which the Plaintiff sought would have the effect of halting a state project; 6. The payment into court by the Defendant was a condition in a court order; 7. The surface repair works for the bridge deck shall continue beyond the official completion date and these are projected to be carried out from September to November, 2020. It was contended that had the above information been presented to the Court, it would have given the case a wholly different complexion to that presented to the Court when the Plaintiff came before it ex parte. It was submitted that, for example, the Court would have had the opportunity to consider whether the order should have been granted given the impact on a state project. R22 On this point, Counsel invited the Court to consider the decision of Justice Newa who was faced with an application for an order of similar effect in the case of Petros Phiri v. Daewoo Engineering and Construction Limited7. It was contended that in that case the Court determined that an order stopping a state project could not, in the interest of justice, be granted. They invited this Court to uphold this position. They reiterated that the Plaintiff had breached its duty of full and frank disclosure by failing to disclose material facts . It was also submitted that when considering the consequences of such failure, the question is one of the interests of justice as stated in Fundo Soberano De Angola v. Dos Santos8 • That, the duty of full and frank disclosure exists in order to ensure the integrity of the court's process, and the sanction available to preserve that is not only to deprive the applicant of any advantage gained by the freezing order granted on an ex parte basis, but also to refuse to renew it. It was submitted that this is the sanction that must be applied in this case. It was argued that it is clear from the wording of the ex parte Order that the Plaintiffs intent is to obtain security. That, the interim relief that the Plaintiff seeks is intended solely to create new conditions by a freezing order akin to an order for security for claims. That, this is the mischief that the case of Mutuwila Farms Limited v. Johan Nortje9, directs against. The Defendant invited the Court to discharge the Order on this basis as well. It was argued further, that the ex parte Order must be discharged in the interests of justice. It was contended that a R23 freezing order may be discharged when a requirement for the same has not been made out. It was claimed that the "just and convenient" requirement has not been made out by the Plaintiff. That, this Court should consider the impact of the order against the impact to a state project; that, it cannot be said that better justice is done when the order prevents a state project from reaching completion. That, for the above reasons, the Defendant prays that the ex parte Order be discharged with costs. ,:~ ~ •, The Defendant has, alternatively, prayed that the ex parte Order granted to the Plaintiff be varied; the essential test being, whether it is necessary in the interests of justice to make the variation sought. It was submitted that in accordance with the holding in the case of Abbey Fonuarding Limited v. Hone10, it is appropriate for the court to order a variation where, inter alia: 1. The order is more onerous to the defendant than is necessary; 11. It imposes unnecessary obligations or hardships on a third party; 111. There are drafting failures (e.g., omission of necessary provisos such as permission to pay trade debts); 1v. Business considerations arise which were not anticipated at the granting of the freezing injunction; v. Where not to do so would cause irremediable harm to the defendant; v1. The 'ordinary and proper course of business' exception needs to be varied. R24 It was submitted that the Court will note from the Defendant's Affidavit and the ex parte Order that: a. The ex parte Order does not allow for the Defendant to use its assets in the ordinary and proper course of business, which is a standard requirement in a freezing order, the absence of which has the effect of making the order more onerous than is necessary and causes irremediable harm to the Defendant. That, its absence is a glaring drafting defect that renders the (~ order irregular and liable to be varied at a minimum; b. The impact of the ex parte Order is that it inevitably places obligations on the governments of the Republics of Zambia and Botswana whose project is for the public benefit; c. The ex parte Order is defective in form in that the penal notice does not appear on the front page of the order as required, and it is also defective in form in that it purports to commit a juristic entity to prison (for this the Court was referred to the cases of Bellamano v. Ligure Lombardo Limited11, Enock Kavindele and Another v. Bologna Properties Limited and Another12, and Beatrice Nyambe v. Barclays Bank Zambia Plc., 13); d . The Defendant has offered to pay into court a sum of money equal to that claimed by the Plaintiff on the condition that the money is not paid out until the appeal by the Defendant is determined, and if that determination is in favour of the Plaintiff, then the money paid back into court is to be held R25 until the interest and costs claimed are assessed and taxed, respectively. It was argued that the Court ought to objectively consider the overall justice of allowing the variation bearing in mind that the assets belong to the Defendant and that the injunction is not intended to provide the Plaintiff with security for his claim or to create an untouchable pot which will be available to satisfy an eventual judgment. It was contended that the Defendant has (~ placed before the Court sufficient basis on which to vary the ex parte Order in the event that the Court is not inclined to discharge it. With respect to the application for the Mareva injunction, it was submitted on behalf of the Defendant that the Plaintiff is not entitled to a freezing order. That, a freezing order is granted where the person claiming it can show that he has a good and arguable claim to be entitled to money from the defendant and there is a real risk that the defendant will remove assets from the jurisdiction or that the defendant will deal with those assets in such a way as to render them unavailable or untraceable so as to render enforcement of ajudgment nugatory. It was further submitted that in making an application for a freezing order, the applicant must present all the material facts or evidence that will show that there exists a danger of the loss or dissipation of the assets with the purpose of frustrating the satisfaction of an eventual execution. That, in this jurisdiction these principles have been set down by the Supreme Court in its R26 decision in Mutuwila Farms Limited v. Johan Nortje (supra), where the Chief Justice stated as follows: a) The court is concerned with protecting the assets from dissipation so as not to render enforcement of a judgment nugatory; b) The court has jurisdiction to grant an injunction to preclude the defendant from removing its assets from the jurisdiction when there is a danger that the debtor may dispose of his assets to defeat the debt; c) The claimant should give some grounds for believing that there is a risk of the assets being removed before the judgment is satisfied; d) It is not enough to assert that the assets will be dissipated, this must be demonstrated by solid evidence; e) The objective of a freezing order is not to provide security for claims. It wa s claimed that the Plaintiff has not shown or even suggested that the Defendant intends to dissipate assets at all, let alone with the intent to defeat enforcement of ajudgment against it. Further, that the relief that the Plaintiff seeks is intended solely to create new conditions by a freezing order akin to an order for security for claims. That, this is the exact mischief that the Mutuwila judgment directs against. It was argued that if the court has found that there is a good and arguable case against the defendant, it will go on to consider whether there is a "real risk" that a judgment obtained by the plaintiff will not be satisfied. R27 It was submitted in addition, that it is necessary to show that there is "solid evidence" of the risk. That, this requirement was highlighted in the Mutuwila judgment (supra). Further, that the Court of Appeal in the case of JOT Engineering Projects Limited v. Dangote Fertilizer Limited and Another14, approved the following summary of the applicable test for a "real risk of dissipation": The relevant legal principle in determining whether for the purposes of granting or maintaining a freezing order a claimant has shown a sufficient "risk of dissipation" is that the claimant will satisfy that burden if it can show that: 1. There is a real risk that a judgment or award will go unsatisfied, in the sense of a real risk that, unless restrained by injunction, the defendant will dissipate or dispose of his assets other than in the ordinary course of business: [The Nidersachsenj per Mustill J as interpreted by Christopher Clarke Jin [TTMI v ASM Shipping}: or 2. That unless the defendant is restrained by injunction, assets are likely to be dealt with in such a way as to make enforcement of any award or judgment more difficult, unless those dealings can be justified for normal and proper business purposes: {Stronghold Insurance v Overseas Union} at 18-1 9 per Potter J and [Motorola Credit Corporation v Uzan (No 2) at 153 (paragraphs 142-146) where the Court of Appeal was applying the same principle in the context of disclosure of assets by the defendant." It was submitted that a useful summary of the "real risk" test was set out by Males Jin National Bank Trust v. Yurov 1s, as follows: z. The claimant must demonstrate real risk that a judgment against the defendant may not be satisfied as a result of unjustified dealing with in Bord Na Mona the defendant's assets. The High Court Horticultural v. Washington also emphasised that the dissipation or disposition risked must be unjustified. R28 n. m. That risk can only be demonstrated with solid evidence; mere inference or generalized assertion is not sufficient. It is not enough to rely solely on allegations that a defendant has been dishonest; rather, it is necessary to scrutinise the evidence to see whether the dishonesty in question does justify a conclusion that assets are likely to be dissipated. w. The relevant inquiry is whether there is a current risk of dissipation; past events may be evidentially relevant, but only if they serve to demonstrate a current risk of dissipation of the assets now held. The nature, location and liquidity of the defendant's assets are important considerations. v. (- vt. Whether or to what extent the assets are already secured or vu. incapable of being dealt with is also relevant. So too is the defendant's behavior in response to the claim or anticipated claim. It was contended that in the present case, the only evidence on which the Plaintiff hinges its real risk of dissipation is a letter from a third party that does not meet the solid evidence threshold requirement. That, the Court must consider whether objectively, on the evidence, there is a realistic, non-theoretical, non-fanciful risk that the Defendant might unjustifiably dissipate its assets to evade the execution of the Court's judgment against such assets. (Emphasis by the Defendant) . It was contended that this risk has not been proved by the Plaintiff. It was submitted in conclusion, that the Defendant'has shown that the Plaintiffs application for a Mareva Order is defective on multiple bases, and for these reasons, the request for a freezing order must be rejected with costs. On 7 th August, 2020, the Plaintiff filed Skeleton Arguments in Opposition of Defendant's Arguments in Support of ex parte 1- R29 Summons to Discharge or Vary ex parte Mareva Order Dated 24th July, 2020 and in Opposition to Summons to Vary Mareva Order. With regard to the claim that the Plaintiff withheld the fact that the interest sums and costs have never been assessed, it was submitted that the Defendant is misapprehending the fact that this is not a judgment enforcement matter but that of asset preservation pending appeal yet to be heard by the Court of Appeal. It was contended that there exists a judgment against the Defendant and the judgment in question remains unpaid or unsecured by payment into court. That, it is immaterial whether interest or costs are taxed or not as a plaintiff is entitled to a Mareva Order to secure the claims made even before a judgment is made. For this contention, the Court was referred to the case of Mareva Compania Naviera SA v. International Bulk Carriers SA (supra). With respect to the Defendant's contention that the Mareva Order has the effect of halting a state project, the Plaintiff argued that the said submission does not have any basis at law as there is no law that would support a defendant to unjustifiably hold back to pay judgment debts or indeed commercial obligations due in the normal course of business. It was further submitted that the case of Petros Phiri v. Daewoo Engineering and Construction Limited (supra) relied upon by the Defendant cannot hold as it is not a Supreme Court of Zambia authority; that in fact, the Supreme Court held as follows with regard to moral or sympathetic considerations in an application for stay in Zambia Revenue Authority v. Post Newspapers16; R30 "Stay of execution should not be granted for mere convenience of the Post, neither should it be granted purely on sympathetic or moral considerations. Secondly, in exercising its discretion whether to grant a stay or not, the court is entitled to preview the prospects of success of the proposed appeal." (Emphasis by the Plaintiff) Responding to the claim by the Defendant that the wording of the Mareva Order shows that the Plaintiff intends to obtain security for the payment, it was submitted that the Defendant is deliberately misreading the Order on the requirement for preservation and ·• security of assets. It was contended that 'security' in the Order refers to physical protection from movement of the assets and not security for the payment of the judgment debt. Further, that the Order uses the word 'may' meaning in the event that this seems necessary. It was submitted that there is nothing unusual about that particular order as these are known rules of a Mareva Order. In this regard, the Court was referred to 185 U. K. Civ. P. R., Practice Directions, Part 25 - Annex- Sample Freezing Injunction, cover page which provides as follows in the Penal Notice: PENAL NOTICE ANY OTHER PERSON WHO KNOWS OF THIS ORDER AND DOES ANYTHING WHICH HELPS OR PERMITS THE RESPONDENT TO BREACH THE TERMS OF THIS ORDER MAY ALSO BE HELD TO BE IN CONTEMPT OF COURT AND MAY BE IMPRISONED, FINED OR HA VE THEIR ASSETS SEIZED. (Emphasis by the Plaintiff) It was submitted that the use of the Sample Freezing Injunction above is common practice and further, that Order 2, rule R31 1 of the Rules of the Supreme Court of England and Wales, 1999 Edition (the White Book), provides as follows: "Where, in beginning or purporting to begin any proceedings or at any stage in the course of or in connection with any proceedings, there has, by reason of anything done or left undone, been a failure to comply with the requirements of these rules, whether in respect of time, place, manner, form or content or in any other respect, the failure shall be treated as an irregularity and shall not nullify the proceedings, any step taken in the proceedings, or any document, ;udgment or order therein. (Emphasis by the Plaintiff) The Plaintiff disagreed with the Defendant's contention that the Plaintiff has failed to make a full and frank disclosure of the risk of dissipation or disposal of its assets and that the only evidence is a letter from a third party that does not meet the solid evidence threshold requirement. The Plaintiff submitted that the Defendant has adduced little or no evidence to support its denial of the claims in the letter from the bridge construction engineers. It was contended that in the absence of any significant countervailing evidence such as an affidavit from the bridge consulting engineers, the sale of assets and imminent departure concerns remain unchanged. It was alleged that all the correspondences of continuing works at the bridge project were done prior to the letter of 16th July, 2020 which was authored by the Defendant's employers' representatives confirming that the Defendant is selling assets. The Plaintiff contended that the Defendant was by law required to support this denial by affidavit evidence from its R32 employers that the letter confirming the asset sale is not true. Further, that the Defendant's continued presence at the bridge project site is by virtue of its employers continuing to need them, but if the employers confirm that the Defendant's assets are being sold, it can be reasonably inferred to be true. It was submitted further, on behalf of the Plaintiff, that indirect evidence is admissible in the Zambian courts of law. Further, that the third party herein is no ordinary third party but the Defendant's • employer. That, it follows therefore, that indirect evidence, where admissible, may be, and frequently is perfectly sufficient to make out a claim, especially m the absence of any significant countervailing evidence. For this submission, the Court was referred to Practice Note 24/5/33 of Order 24 of the White Book where it states that secondary evidence as to the contents of a privileged document is admissible as against the party resisting its production. Thus, if a party has an opportunity of taking or getting a copy of such a document, he can use it as secondary evidence. It was contended that in view of the above points of law, the ex parte Mareva Order granted on 24th July, 2020, should not be discharged. With regard to the variation of the ex parte Mareva Order, it was argued on behalf of the Plaintiff that the Defendant has failed to provide security by paying the sums of USD224,249.49 and K3,000,000.00 into court to be held in order to support the variation of the ex parte Mareva Order. On this basis, it was submitted, the ex parte Order of 29th July, 2020 varying the terms R33 of the Mareva Order granted on 24th July, 2020, should be discharged forthwith. It was submitted further, that the ex parte Mareva Order cannot be varied so as not to prohibit the Defendant from dealing with or disposing of any of the assets listed in the schedule granting the Order of 24th July, 2020 at any time including in the proper course of business for the following reasons: 1. The preservation of the value of the assets will be eroded if the • Defendants continue using the assets. It will therefore, prevent the purpose of the Order as legally required; 11. The Defendant is not in the business of trading or selling the type of assets listed in the schedule granting the Order of 24th July, 2020 as it is in the jurisdiction for the sole purpose of constructing a bridge and not selling the listed type of assets. Therefore, the Defendant is prohibited from varying the Mareva Order to dispose of any assets in the normal course of business. In conclusion, it was submitted that it is clear that the Defendant lacks probity and its word cannot be relied upon. Further, tha t the Defendant h a s failed to meet its own proposals to vary the Mareva Order and insists on sustaining a varied Mareva Order which allows it to sell assets in the "normal course of business", which is all intended to have a legal basis to evade justice. It was further contended that the varied Order puts the Plaintiff at risk as part of the judgment debt is not secured by way of payment into court or assets held under the Mareva Order. R34 Therefore, the risk to dispose of assets remams real as the Defendant has not rebutted the allegation that it is disposing of assets by way of affidavit from the engineers of the Kazungula Bridge representing its employers. That, in the absence of such judgment debt remaining secured by Mareva Order or being paid into court, the ex parte Order of 29th July, 2020 varying the terms of the Mareva Order granted on 24th July, 2020 must be discharged forthwith with costs and the ex parte Mareva Order granted on 24th • July, 2020 must be sustained. On 12th August, 2020, the Defendant filed Skeleton Arguments in Reply to the Plaintiffs Skeleton Arguments in Opposition wherein it argued that aside from the fact that the Plaintiff is wrong on its understanding of the materiality of the non-disclosed facts, the question of materiality is one for the court to determine; the obligation on the party seeking an ex parte Mareva order being to make a full and frank disclosure, a duty necessary to enable the court to fulfill its own obligations to ensure fair process. That, where the court is to adopt the ex parte procedure where justice so requires, it must be able to rely on the party who appears alone to present the evidence and arguments in a way which is not merely • designed to promote its own interests, but in a fair and even handed manner, drawing attention to evidence and arguments which it can reasonably anticipate the absent party would wish to make. That, it is the duty owed to the court which exists in order to ensure the integrity of the court's process. R35 In further reply, the Defendant disagreed with the Plaintiffs contention that it is immaterial whether interest or costs are taxed or not. That, in Third Chandris Shipping Corporation and Others v. Unimarine SA (supra), it was stated, inter alia, that an affidavit in support of a Mareva injunction should give enough particulars of the Plaintiffs case to enable the court to assess its strength. That, in this case, the Plaintiff did not give the Court the true particulars of its case and did not state that it was awarded interests and costs that were yet to be assessed and taxed but which were, in its view, equal to amounts claimed. That, instead, the Plaintiff presented the figures as though they were determined as being correct, thereby falling short of the obligation placed on a party who comes to court ex parte to present evidence in a way which is not merely designed to promote its own interests. It was argued that it is trite that the law does not allow for the recovery of costs before agreement or taxation where no agreement can be reached, and that interest claimed must be assessed before it can be claimed as being unpaid. It was submitted that this is material in an application for a Mareva injunction not least because the court is being called upon to determine whether a defendant is dissipating its assets to make itself judgment-proof. It was argued further, that the Plaintiff does not dispute that it did not inform the Court that the Mareva injunction it seeks would affect a state project. That, the Plaintiff misses the point that it withheld a material fact which it should have disclosed. That, in determining whether it would be just for the Court to make the order the <e • R36 Plaintiff seeks, it is material that the order would affect a state project and even more material that the Plaintiff should have informed the Court that it sought to stop a state project; that it is for the Court to decide whether justice would be served by the Mareva injunction on a full appreciation of the facts. With regard to the case of Zambia Revenue Authority v. Post Newspapers (supra), it was submitted that the decision to call in aid that judgment is misplaced, firstly, because that decision related to • a stay of execution, which is not in issue in casu. Secondly, the considerations in this case are not moral or sympathetic, but based on the law as it was discussed in the Petros Phiri case. Responding to the argument that the Defendant has misunderstood the wording of the order granted by the Court and drawing parallel of the same with the wording of a sample freezing order, the Defendant argued that the provisions cited by the Plaintiff are, by its own admission, housed in the penal notice of the sample Mareva Order. That, this is materially different from the wording of the order in the current case where the Plaintiff has the right, on its own, to take possession of the Defendant's assets if the Plaintiff considers this to be necessary. It was submitted that the fact that the sanction of asset seizure is ordinarily part of a penal notice is significant as the penal notice is triggered only where there is non-compliance with a court order and is enforced only once confirmed by the court. That, a penal notice places a party who has been served on notice of the consequences on not complying with R37 the order. That, this is clearly different from what the Plaintiff sought to achieve in this case. It was submitted further, in reply, that the Plaintiff did not provide solid evidence. That, unsupported statements and expressions of fear carry very little, if any, weight and that the court needs to act on objective facts from which the court can infer that the Defendant is likely to move assets abroad or dissipate them within the jurisdiction. It was submitted that this is in keeping with the cases of Mareva Compania Naviera SA v. International Bulk Caniers SA and Third Chandris Shipping Corporation and Others (supra). Further, that the English Court of Appeal in Candy v. Holyoake 17, at paragraphs [49] - [54], emphasised that the burden is on the applicant to satisfy the real risk threshold. The court will decide on the basis of all the evidence before it, but in practice, if an applicant has not adduced sufficient evidence, the application will fail. In this regard the court said that the Respondent's evidence will be immaterial, unless it lends support to the application. The ,. court was clear that the burden of proof should not shift from the applicant to the respondent to explain conduct that does not, on the evidence, require an explanation. It was argued that the Plaintiff clearly seeks to shift this burden by arguing that "the Defendant is required by law to support this denial by affidavit evidence from its employer that the letter con.firming the asset sale is not true". It was submitted that that is not the law; the law being that the Plaintiff must present solid evidence that the Defendant is likely to move the R38 assets abroad or dissipate them within the jurisdiction; which evidence the Plaintiff has not presented. It was argued further, in reply, that the Plaintiff has misunderstood the varied order. It was submitted that the Defendant has materially demonstrated the basis on which the Mareva injunction should be varied, and repeats the arguments in its Skeleton Arguments. That, in support of its application that the Mareva injunction should be varied, the Defendant has argued, • inter alia: t. n. That the Mareva injunction is defective in form; and The Mareva injunction is unreasonably onerous. With regard to the Plaintiffs argument that the Defendant has failed to provide security by paying the sums into court, and therefore, the varied Order granted ex parte should be discharged, it was submitted that, that is not what the varied Order provides. That the Order as varied, clearly provides that the Defendant is prevented from dissipating its assets except in the ordinary course .• of business, and if the Defendant pays into court USD224,249.49 and K3,000,000.00, then the Mareva Injunction shall have no effect. It was submitted that the following is the standard wording from the sample that the Plaintiff itself relied on; which at 11 provides: EXCEPTIONS TO THIS ORDER 11. (1)[. .......... .... ....... J R39 (2) [This order does not prohibit the Respondent from dealing with or disposing of any of his assets in the ordinary and proper course of business.] (3) [. .. ..... .... ...... .. } (4) The order will cease to have effect if the Respondent - a) Provides security by paying the sum of. .. Pounds into court, to be held to the order of the court; or b) Makes provision for security in that sum by another legal method representatives. (Emphasis supplied by the Defendant) Applicant's agreed with the It was submitted that it is clear from the sample above that it applies to the use of the assets in the ordinary course of business. It was argued that freezing orders should not be used oppressively. They should not, for example, cause the defendant to cease trading. That, the courts have long aclrnowledged that freezing orders are not intended to prevent a defendant from carrying out its ordinary business dealings, according to the principles laid down by Goff J ., in Iraqi Ministry of Defence v. Arcepey Shipping Company SA (The • • Angel Bell)1 8• It was contended that it is well established that the purpose of a freezing order is to prevent a party from rendering itself judgment proof. That, this is not what the order drafted by the Plaintiff seeks to prevent; it seeks to prevent the Defendant from using its assets at all and the order it seeks is akin to a security order. That, by contrast, the Defendant seeks, where the court is not inclined to discharge the order, an order that it be prevented from dissipating its assets but be allowed to continue to use them in the ordinary R40 course of its business. In conclusion, it was submitted that the harm the Defendant is likely to suffer substantially outweighs any harm the Plaintiff might suffer if the discharge or variation requested is not granted. The two applications came up for hearing on 12th August, 2020 and for the Plaintiffs application for an order of Mareva injunction, both Counsel indicated that they would rely on the documents filed in support of their respective cases. • With regard to the Defendant's application to discharge or vary the ex parle Mareva Order, Mr. Petersen, learned Counsel for the Defendant, submitted that the Defendant would rely on the Affidavit in Support filed on 29th July, 2020, as well as the List of Authorities and Skeleton Arguments of even date. Mr. Petersen submitted that the basis of the application was that the Plaintiff in moving its application for Mareva injunction failed to produce all the material relevant to an application for Mareva injunction. He drew the Court's attention to paragraphs 11 - 26 of the Skeleton Arguments. • He also submitted that in the alternative, if a discharge is not granted, the Mareva injunction be varied and in that regard, drew the Court's attention to paragraphs 27 - 31 of the Skeleton Arguments. It was his prayer that the Mareva injunction be discharged with costs or alternatively, that it be varied. In response, Mr. Mutemwa, learned Counsel for the Plaintiff, submitted that the Plaintiff opposed the application and in doing so, would rely on the Affidavit in Opposition and Skeleton Arguments in Opposition filed into Court on 7 th August, 2020. Mr. Mutemwa R41 submitted further, that the Plaintiff objected to the Defendant's application for an order of variation of the Mareva injunction because the rules of court are very clear in relation to variation of the Court's orders or judgments. He referred the Court to Order 39, rule 1 of the High Court Rules, Chapter 27 of the Laws of Zambia. According to Mr. Mutemwa, there is nowhere in the rules where it provides for the Court to vary its judgment or orders. That, if the Defendant is dissatisfied with the Order of Mareva injunction • granted by this Court, the proper course of action to have taken was to apply for review of the said order as provided by Order 39 of the High Court Rules. Further, that if the Defendant was dissatisfied with the Order of Mareva injunction, it could have lodged an appeal to the Court of Appeal. He contended that in light of the fact that the Defendant took none of these steps, the application for variation is incompetently before this Court and the same should be dismissed with costs. In relation to the arguments by the Defendant that the Plaintiff did not disclose material facts in relation to this case, Mr. Mutemwa submitted that the argument flew in the teeth of the evidence which 1s before this Court and that evidence relates to the correspondences by the Defendant of its decision to sell its assets, as highlighted under paragraphs 8 and 9 of the Affidavit in Opposition, where, according to Counsel, it shows very clearly that the Defendant is proceeding to dispose of its assets within the jurisdiction. Further, that the Defendant has not specifically refuted that no sale is going to proceed and furthermore, the • R42 Defendant in its application has elected to pay the interest plus costs into court. That, this notwithstanding, the Defendant had not complied with this order of the Court 15 days after it had filed its application. It was contended that these are the real fears which the Plaintiff has, especially that the Defendant still insists on proceeding with the sale of its assets. That consequently, it is the Plaintiffs prayer that the Mareva injunction be confirmed. In reply, Mr. Petersen submitted that the Defendant would rely • on the List of Authorities and Skeleton Arguments in Reply filed into Court on 12th August, 2020. With respect to the Court's jurisdiction to grant a variation of a Mareva Order and/or to discharge a Mareva Order, Mr. Petersen drew the Court's attention to Practice Note 29 / lA/ 33 of Order 29 of the White Book, which Counsel submitted, provides that an injunction order granted ex parte can be varied or discharged by the Court that granted it. Counsel argued that in moving this Court for a Mareva injunction the Plaintiff relied on the provisions of Order 29 of the White Book • and it is on these same rules that the Defendant has moved the Court for a variation or discharge of the Mareva Injunction. In reply to the substantive points in opposition, Mr. Petersen submitted that the Plaintiff has not denied that it did not disclose the facts that the Defendant says it did not; that instead, the Plaintiff in its Affidavit in Opposition and Skeleton Arguments in Opposition attempted to explain why the material it did not disclose is not material to the Mareva injunction application. Counsel R43 reiterated that the Plaintiff should have disclosed the material and left it to the Court to determine materiality. With respect to the argument that the Defendant had failed to pay into court in compliance with the varied order, Mr. Petersen submitted that the Plaintiff has misunderstood the varied order. That, the varied order provides that if payment is made into court, then the Mareva order ceases to have effect. That, correctly understood, this means the varied Mareva injunction prevents the Defendant from dissipating its assets until and unless the Defendant makes a payment into court. Mr. Petersen submitted in respect of the argument that the Defendant has not denied that it is selling its assets, that the Court should consider the Affidavit filed on 29th ~uly, 2020, in particular, paragraphs 23 and 24 where the deponent expressly states that the Defendant is not in the process of selling its assets and goes on to explain that statement. Counsel prayed that the Mareva injunction be discharged or alternatively, varied. I have considered the Plaintiffs application for an order of Mareva injunction and the Defendant's application for an order discharging the ex parte Mareva Order or alternatively, varying the said Order. I have also carefully considered the Affidavits, Lists of Authorities and Skeleton Arguments filed by both parties for both applications. In addition, I have deliberated on the oral submissions by Counsel on both sides. I am indebted to Counsel on both sides for the industry exhibited through the comprehensive arguments filed in support of their respective cases. R44 Before delving into the substantive applications before Court, I will begin by dealing with of the objection by the Plaintiff to the Defendant's application for an order of variation of the Mareva injunction on the ground that there is nowhere under Order 39, rule 1 of the High Court Rules, Chapter 27 where it provides for the Court to vary its judgment or orders. It was argued that if the Defendant was dissatisfied with the Order of Mareva Injunction granted by this Court, the proper course of action to have taken was to apply for review of the said order as provided by Order 39 of the High Court Rules; alternatively, that the Defendant could have lodged an appeal to the Court of Appeal. That, in light of the fact that the Defendant took none of these steps, the application for variation is incompetently before this Court and the same should be dismissed with costs. Responding to this objection, it was submitted on behalf of the Defendant that Practice Note 29 / lA/33 of Order 29 of the White Book provides that an injunction order granted ex parte can be varied or discharged by the Court that granted it. It was argued e that in moving this Court for a Mareva injunction the Plaintiff relied on the provisions of Order 29 of the White Book and it is on these same rules that the Defendant has moved the Court for a variation or discharge of the Mareva Injunction. I have perused Order 39, rule 1 of the High ·court Rules. It provides as follows: ''Any Judge may, upon such grounds as he shall consider sufficient, review any judgment or decision given by him (except where either party shall have obtained leave to appeal, and such appeal is not R45 withdrawn), and, upon such review, it shall be lawful for him to open and rehear the case wholly or in part, and to take fresh evidence and to reverse, vary or confirm his previous judgment or decision." Practice Note 29 / lA/ 33 of Order 29 of the White Book states as follows" "Discharge of Injunction - The several standard forms for injunctions annexed to Queen's Practice Direction No. 12 (Vol.2, Section 2C, paras. 2C-42 et seq.) contain clauses dealing with variation and discharge. An injunction granted ex parte may on sufficiently cogent grounds be discharged or waived on an application itself made ex parte (London City Agency (JCD) Ltd v. Lee [1970] Ch.597; [1970] 2 W. L. R. 136; [1969] 3 All E. R. 1376)." (Underlining by the Court for emphasis only) Practice Note 29/lA/32 of Order 29 of the White Book states as follows: "Duration of Interlocutory Injunction - The several standard forms for injunctions annexed to Queen's Bench Practice Direction No. 12 (Vol.2, Section 2C, paras 2C-42 et seq.) provide that the injunction should remain in force up to and including the return date, or until judgment in the action (unless before then it is varied or further order) ... The standard forms of Mareva discharged by injunctions prove that, alternatively, the injunction may cease to have effect if the defendant provides security, or if the plaintiff fails in damages." to provide a guarantee (Underlining by the Court for emphasis only) for his undertaking After considering the objection by the Plaintiff, the Defendant's response to the objection and the provisions cited, I am of the view that while it is correct that under our own rules there 1s no provision for variation of an order such as the one under consideration, in the absence of our own rules recourse can be had .. R46 to the White Book. Further, as correctly submitted by Mr. Petersen on behalf of the Defendant, in moving this Court for a Mareva injunction the Plaintiff relied on the provisions of Order 29 of the White Book and it is on these same rules that the Defendant has moved the Court for a variation or discharge of the injunction. It is correct, as submitted by Mr. Petersen, that an injunction order granted ex parte can be varied or discharged by the Court that granted it. From the Practice Notes cited above, what emerges is that the standard forms of injunctions under the Queen's Bench Practice Directions contain clauses dealing with variation and discharge of injunctions. Further, an injunction remains in force unless varied or discharged. It is evident from the aforesaid that a Mareva injunction can be varied or discharged by court order. Therefore, in view of the above, I find that the application for variation is competently before this Court. However, before I proceed to deal with the substantive application for an Order of Mareva injunction before this Court, I feel compelled to correct the misconception that I have observed that the application for Mareva injunction is made pursuant to Order 29 /L/35A of the White Book. The correct position is that the application is made pursuant to Order 29, rule 1 of the White Book which provides for applications for injunction, a Mareva injunction being one such application. What has been referred to by the Plaintiff as Order 29/L/35A is not an Order pursuant to which an application can be made, but a Practice/Editorial Note under Order 29 which provides explanatory notes on Mareva injunctions. R47 Moving on to the substantive application for an Order of Mareva injunction, it is not in dispute that the Defendant is a foreign corporation, albeit registered at the Patents and Companies Registration Agency (PACRA). However, the fact that the Defendant is a foreign company does not, per se, justify the granting of a Mareva injunction, as per the decision in the case of Third Chandris Shipping Corporation and Others v. Unimarine SA (supra) . There must be facts from which the commercial court, like a prudent, sensible commercial man, can properly infer a danger of default. In other words, certain requirements must be fulfilled before a Mareva injunction can be granted to an applicant. Therefore, the issue for determination h erein is, in my view, whether or not the Plaintiff has fulfilled the requirements for the grant of a Mareva injunction. It should b e noted that the application for a Mareva injunction has been made post-judgment. However, this Court has the jurisdiction to grant the order being sought because the same can be granted at any time. In the case of Onvell Steel (Erection and Fabrication) Ltd v. Asphalt and Tarmac (U. K.) Ltd19, it was held that an injunction may be granted after judgment in aid of execution where there are grounds for believing that the debtor intends to dispose of assets in order to avoid execution. Thus, a Mareva Injunction will be granted under the following circumstances: 1. There is a debt due and owing from the Defendant to the Plaintiff; 2. The Defendant has assets within the jurisdiction; and R48 3. There are grounds for believing that the debtor intends to dispose of assets in order to avoid execution; Consequently, in order for this Court to exercise its discretion 1n favour of granting a Mareva injunction, the Defendant must satisfy the Court that the requirements for the grant of a Mareva injunction listed above have been satisfied. In respect of the requirement of a debt due and owing from the Defendant to the Plaintiff, it is on record that this Court entered judgment in favour of the Plaintiff for USD431,930.46, plus interest and costs on 27th May, 2020, which judgment has been appealed against by the Defendant. An ex parte order of stay of execution of the said judgment was granted by the Court of Appeal and a ruling is being awaited on the inter partes application. Therefore, the judgment debt herein meets the requirement of a debt due and owing from the Defendant to the Plaintiff. The second requirement above is that the Defendant must have assets within the jurisdiction. It is not in contention that the Defendant was awarded a construction contract by the governments of Zambia and Botswana to build a bridge across the Zambezi River at Kazungula on 5 th September, 2014 and that the Defendant has amassed assets within the jurisdiction. Therefore, the second requirement of the Defendant having assets within the jurisdiction has also been fulfilled. With regard to the third and in my view, most important requirement, namely, existence of grounds for believing that the debtor intends to dispose of assets in order to avoid execution, the • R49 Plaintiff has exhibited "JMT4", being a memorandum from the Team Leader of the Kazungula Bridge Consultants dated 16th July, 2020, addressed to members of staff. The subject of the said memorandum is "Sale of Contractor's Plant and Equipment", and the members of staff are being advised that Package 1 Contractor (Daewoo Engineering and Construction Limited - the Defendant herein), is selling plant and equipment to the highest bidder among members of the public. It is the Plaintiffs contention that the evidence exhibited as "JMT4" is irrefutable and credible as the source of information is from the Defendant's consulting engineers. On the other hand, the Defendant is claiming that exhibit "JMT4' is not authored by the Defendant and does not state a date that the alleged sale is set to take place. It was deposed in the Affidavit of Donchang Kim of 29th July, 2020, that there is no ongoing sale of the Defendant's assets and there is no imminent risk of the Defendant departing from Zambia as the Defendant will continue performing work on the Kazungula Bridge even after hand over of the certificate of completion. In my view, exhibit "JMT4" is incontrovertible evidence that the Defendant is selling its plant and equipment itemised in the list attached to the memorandum of 16th July, 2020 from the Team Leader of the Consultants. Contrary to the allegation by the Defendant that exhibit "JMT4" does not state the date when the alleged sale is set to take place, it is evident from the exhibit that the sale by public tender has already started and is ongoing. Further, even though the said memorandum is not authored by the RSO Defendant, the author, as correctly argued by the Plaintiff, is no ordinary third party but the Defendant's consulting engineers. In my view exhibit "JMT4" is credible evidence that the Defendant is selling its assets and thus, meets the solid evidence threshold. This notwithstanding, there is no evidence before this Court that the Defendant is selling its assets with the intent to defeat enforcement of the judgment against it. As the Supreme Court stated m Mutuwila Farms Limited v. Johan Nortje (supra), the court 1s concerned with protecting the assets from dissipation so as not to render enforcement of a judgment nugatory. In the present case, there is no real risk that the judgment obtained by the Plaintiff will not be satisfied by the Defendant because the judgment sum of USD431,930.45 has already been paid into court by the Defendant, albeit with the attendant claim of exchange rate differential loss by the Plaintiff. In addition, the Defendant is willing to pay the interest and costs assessed by the Plaintiff into court pending the e determination of the appeal in the Court of Appeal on condition that the money is not paid out until the appeal by the Defendant is determined, and if that determination is in favour of the Plaintiff, then the money paid into court is to be held until the interest and costs claimed are assessed and taxed, respectively. In view of the aforesaid, the third requirement of existence of grounds for believing that the debtor intends to dispose of assets in order to avoid execution has not been satisfied. With the finding above that a vital requirement for the grant of a Mareva injunction has not been satisfied, ordinarily I would have • RSl discharged the ex parte Order of Mareva injunction granted to the Plaintiff. However, I will sustain the Order in view of the variation to the same effected by the ex parte Order of 29th July, 2020. The effect of the varied Mareva Order, as correctly submitted by Mr. Petersen, learned Counsel for the Defendant, is that it prevents the Defendant from dissipating its assets until and unless the Defendant makes a payment into court. Therefore, in order to secure the payment of interest and costs to the Plaintiff in 0-e event that the Court of Appeal determines the appeal in its favour, I will confirm the ex parte Order varying the terms of the Mareva Order. In so doing, I agree with the submission by Counsel for the Defendant that before the variation, the ex parte Order of Mareva Injunction had no provision allowing the Defendant to use its assets in the ordinary and proper course of business - a standard requirement in a freezing order, the absence of which has the effect of making the order more onerous than is necessary. Therefore, the absence of such a clause was a drafting defect that rendered the order irregular. Further, clause (iii) of the ex parte Order of Mareva Injunction gave the Plaintiff the right to take custody of any of the Defendant's assets if need be, for purposes of preservation, pending determination of the Defendant's appeal. As correctly submitted by Counsel for the Defendant, that clause gave the Plaintiff the right on its own, to take possession of the Defendant's assets whenever it considered this to be necessary. I also agree with the submission that the fact that the sanction of asset seizure is ordinarily part of a e • RS2 e penal notice is significant as the penal notice is triggered only where there is non-compliance with a court order and is enforced only once confirmed by the court. It is also correct that a penal notice places a party who has been served on notice of the consequences on not complying with the order. Clearly, this is not what the Plaintiff sought to achieve by including clause (iii), as a stand-alone clause instead of being part of the penal notice. Therefore, the deletion of the said clause was in order. The situation obtaining at present is that the Defendant has paid into court thejudgment sum of USD431,930.45 by order of the Court of Appeal. Further, the varied ex parte Order has made provision for the Order to cease having effect if the Defendant provides security by paying USD224,249.29 and K3,000,000.00, being interest and costs, respectively, as calculated by the Plaintiff, into court. For the rea sons aforesaid, the ex parte Order of Mareva Injunction Pending Appeal dated 24th July, 2020 as varied by the ex parte Order dated 29th July, 2020, is confirmed. Costs shall be in the cause. Leave to appeal is denied. Dated at Lusaka this 22nd day of September, 2020 &/~ ~ -•~.~-C, DR. W. S. MWENDA JUDGE