Mofya v Stalyon Employment and Investment Ltd and Ecobank Limited (Appeal 11 of 2013) [2014] ZMSC 113 (29 July 2014)

J1 SCZ Judgment No. 37 of 2014 IN THE SUPREME COURT OF ZAMBIA 011/2013 HOLDEN AT NDOLA/LUSAKA (Civil Jurisdiction) BETWEEN: RICHARD MOFYA AND P884 Appeal No. Appellant STALYON EMPLOYMENT AND INVESTMENT LTD Respondent 1 st ECOBANK LIMITED Respondent 2 nd Coram: Chibesakunda, A/CJ, Wood, JS, Lisimba, A/JS On 3rd June, 2014 and 30th July, 2014. For the Appellant: In Person For the 1 st Respondent: For the 2 nd Respondent: N/A N/A. JUDGMENT ________________________________________________________________ Lisimba, A/JS, delivered the Judgment of the Court. Cases referred to: J2 1. American Cyanamid Company Vs. Ethicon Limited(1975) A. C396. P885 2. Preston Vs. Luck(1884) 27 ChD. 497. 3. Shell and B. P Zambia Limited Vs. Conidaris and Others (1975) Z. R. 174. 4. Ndove Vs. National Educational Company Limited (1980) Z. R.184 . 5. Turnkey Properties Limited Vs. Lusaka West Development Limited and Others (1984) Z. R. 85. 6. Ahmed Abad Vs. Turning and Metals Limited (1987) Z. R. 86. 7. Wise Vs. Harvey (1985) Z. R.179. 8. Wilson Masauso Zulu Vs. Avondale Housing Project Ltd (1982) ZR 172. 9. YB and F Transport Limited Vs. Supersonic Motors Ltd (2000) Z. R. 22. 10. Mutale Vs. Zambia Consolidated Copper Mines (1993- 1994) Z. R. 94. 11. Water Wells Limited Vs. Wilson Samuel Jackson (1984) Z. R. 98. Other works referred to: 1. Halsbury’s Laws of England, 4th Edition, Vol. 3 (1), at Para 147 and 149. 2. Atkins Court Forms, 2nd Edition, 1995 Issue, Vol. 4, at Para 5. J3 3. Order 15/1/2 of the Rules of the Supreme Court, 1999 Edition. 4. Orders 3 Rule 2 and 18 of the High Court Rules, Cap 27 of the Laws of Zambia. P886 This is an appeal against a ruling of the High Court sitting at Ndola, dated 5th November, 2012 in which the trial Judge dismissed the appellant’s application for an interlocutory injunction and set aside the appellant’s Writ of Summons and Statement of Claim for irregularity as against the 2nd respondent. The brief background of this case is that the appellant, who was the plaintiff in the Court below, engaged the 1st respondent to secure a bursary for his son, Joshua Mofya, at a named institution in the United Kingdom and in return made several payments amounting to GB £2,700 to the 1st respondent through the 2nd respondent bank. The 1st respondent failed to fulfill its part of the agreement hence the appellant filed a Writ of Summons and Statement of Claim on the 7th of August 2012 J4 against the 1st respondent and 2nd respondent bank claiming the following: 1. An Order reversing the cheques deposited in the 1stDefendant’s account through the 2nd Defendant. 2. Damages for mental distress. 3. Costs. 4. Any other relief the Court may deem fit. P887 The appellant also filed into Court Inter-partes Summons for an Order of interim injunction together with a supporting affidavit on the 9th of August, 2012. The application for interim injunction sought an Order to restrain the respondents from performing any monetary transactions in the 2nd respondent bank. In response, the 2nd respondent filed into Court a conditional Memorandum of Appearance on the 27th of August, 2012, an opposing affidavit sworn by Daniel Kankomba, the respondent’s Branch Manager, and skeleton arguments in opposition on the 26th of September, 2012. The respondent also filed Inter-partes Summons to set aside Writ of Summons and Statement of Claim against it for irregularity together with a J5 supporting affidavit on the 4th of September 2012, also sworn by Daniel Kankomba. The averments in the appellant’s supporting affidavit for an injunction are that the 1st respondent’s bank account at the 2nd respondent bank had been blocked by the police, hence the appellant asked the trial Court to stop any further transactions between the 1st and 2nd respondents. P888 In his opposing affidavit, Daniel Kankomba averred that the 1st respondent’s account with the 2nd respondent bank was dormant and there were no transactions or activities thereon by the 1st respondent; that the 2nd respondent was not privy to the relationship between the appellant and the 1st respondent; that the appellant’s action was misconceived and the application for an injunction against it ought not to be granted by the trial Court. On the 28th of September 2012, the learned trial Judge heard and considered the appellant’s application for an interim injunction and subsequently delivered a ruling dated 5th November, 2012 in which she found the following facts: that the J6 Writ of Summons and the Statement of Claim did not disclose a cause of action against the 2nd respondent; that the mere reason that the 2nd respondent was the 1st respondent’s banker did not mean that the 2nd respondent was liable for the actions of the 1st respondent in relation to third parties; that this was not a proper case for the Court to grant an interlocutory injunction as the appellant could be adequately compensated in damages if he succeeded in the main action. P889 Based on the above findings, the trial Judge set aside the Plaintiff’s Writ of Summons and Statement of Claim for irregularity and also dismissed his application for an interlocutory injunction with costs. It is against this ruling that the appellant has now appealed on the following three grounds: 1. The Judge erred when she dismissed the application for interlocutory injunction to protect the Appellant’s monies that were deposited into the 2nd Respondent’s J7 Bank by the 1st respondent and where a Certificate of Urgency was even filed into court. 2. The Judge further erred when she ruled that the Appellant had no cause of action against the 2nd Respondent when the Writ of Summons and Statement of Claim clearly states the cause of action. 3. The Judge also erred when she awarded the costs to the 2nd Respondent after dismissing the interlocutory injunction, knowing that the Appellant was pursuing his monies with the 1st and 2nd Respondents. P890 At the hearing of this appeal on the 3rd June, 2014, only the appellant was in attendance before Court and in addressing us, he indicated that he would rely on his written heads of argument which he filed into Court on the 18th of January, 2013. Both the 1st and 2nd respondents were not in attendance at the hearing; neither did they file written heads of argument in response to this appeal. Under ground one, the appellant argued that in an application for an injunction, two elements must be satisfied namely that: J8 a) The plaintiff must establish that he has a good arguable claim to the right he seeks to protect; b) The Court must not attempt to decide the claim on affidavits; it is enough if the plaintiff shows that there is a serious question to be tried. The appellant argued that he met the above requirements and in support of his arguments, he cited two English cases of the American Cyanamid Company Vs Ethicon Limited1and Preston Vs Luck2. P891 It was further argued that having found that the 2nd respondent could not, by virtue of being the 1st respondent’s banker, be held liable for the 1st respondent’s wrongs and /or indiscretions, it was erroneous for the trial Judge to hold that the 1strespondent could be ordered to compensate the appellant in damages in the event that the appellant was successful. Under ground two, the appellant argued that the trial Judge should not have set aside the appellant’s Writ of Summons and Statement of Claim for irregularity as the cause J9 of action against the 2nd respondent was disclosed in paragraph 2 of the Statement of Claim. It was also argued that the trial Judge had the power, pursuant to Orders 3 Rule 2 and 18 of the High Court Rules, Cap 27 of the Laws of Zambia, to order the amendment of the Writ of Summons and Statement of Claim to ensure that justice is done. Order 3 Rule 2 provides as follows: “Subject to any particular rules, the Court or a Judge may, in all causes and matters, make any interlocutory order which it or he considers necessary for doing justice, whether such order has been expressly asked by the person entitled to the benefit of the order or not.” P892 And Order 18 provides that: “The Court or a Judge may, at any stage of the proceedings, order any proceedings to be amended, whether the defect or error be that of the party applying to amend or not; and all such amendments as may be necessary or proper for the purpose of eliminating all statements which may tend to prejudice, embarrass or delay the fair trial of the suit, and for the purpose of determining, in the existing suit, the real question or questions in controversy between the parties, shall be so made. Every such order shall be made upon such terms as to costs or otherwise as shall seem just.” J10 Under ground three, it was the appellant’s very brief argument that the 2nd respondent was not entitled to an award of costs. We have considered the appellant’s grounds of appeal, the written heads of argument and the authorities cited, the record of proceedings and the ruling of the Court below. In ground one, the appellant has raised the issue whether or not, on the facts of this case, he was entitled to the relief of an interlocutory injunction to restrain the 2nd respondent from allowing the 1st respondent to perform any transactions on its account at the 2nd respondent bank. P893 The principles upon which an injunction may be granted are well settled in this country. The two primary issues to be addressed or considered at the outset are whether the claimant has demonstrated that: 1. His right to relief is clear; and 2. Irreparable damage will be occasioned to the claimant if the injunction was not granted. J11 This is in line with our decision in Shell and B. P Zambia Limited Vs. Conidaris and Others3 where we held that: “A court will not generally grant an interlocutory injunction unless the right to relief is clear and unless the injunction is necessary to 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". In Ndove Vs. National Educational Company Limited4, a High Court decision which does not bind us but which we approve, Chirwa J, as he then stated that: “Before granting an interlocutory injunction it must be shown that there is a serious dispute between the parties and the plaintiff must show on the material before court, that he has any real prospect of succeeding at the trial” P894 If the Court is of the view that there is a serious question to be tried, it should proceed to consider whether or not a claimant could be adequately compensated by an award of J12 damages if successful at trial. In Turnkey Properties Limited Vs. Lusaka West Development Limited and Others5, we held that in an application for an Interlocutory injunction, the possibility of damages being an adequate remedy should always be considered. In our later decision in Ahmed Abad Vs. Turning and Metals Limited6, we held that where damages would be an adequate remedy, the award of an injunction is inappropriate. According to the record in this case, the appellant’s application for an interim injunction came up for hearing before the trial Judge on the 28th of September 2012. At the hearing, the appellant told the Court that he wanted an order to reverse the cheques he had deposited in the 1st respondent’s account as he had been defrauded. In response, Counsel for the 1 st respondent Mrs. Kunda relied on the 1st respondent’s opposing affidavit and skeleton arguments in opposition on record. P895 From the evidence on record, we take the view that the appellant deposited money into the 1st respondent’s account at J13 the 2nd respondent bank on the basis of the agreement which he had with the 1st respondent. We are satisfied that the relationship between the two was that of customer and banker. The learned authors of Halsbury’s Laws of England, 4th Edition, Vol. 3 (1), at Para 149 describe such a relationship as one of principal and agent. They also describe the usual characteristics found in bankers at Para 147 in these terms: 1) They accept money from, and collect cheques for, their customers and place them to their credit; 2) They honour cheques or orders drawn on them by their customers when presented for payment and debit their customers accordingly; 3) They keep current accounts in their books in which the credits and debits are entered. P896 The learned authors of Atkins Court Forms, 2nd Edition, 1995 Issue, Vol. 4, at Para 5, have summarised the duties owed by an agent to its principal to include the duty to J14 carry out the principal’s lawful instructions and to indemnify his principal in respect of the agent’s negligence or other breach of duty. From the authorities we have cited, and in the absence of any evidence to the contrary, it is our considered view that the role of the 2nd respondent in this case was merely to operate the 1st respondent’s account as its banker/agent according to the set banking procedures. The appellant has not satisfied us that the 2nd respondent, as agent, breached any such banking procedures or the appellant’s instructions as the principal. We also find no evidence to establish that the appellant had raised triable issues against the 2nd respondent in respect of which his right to relief could be ascertained and on the basis of which the relief of an injunction could be granted to him as set out in both the Shell and B. P4 and Ndove5 cases. We further take the view that the appellant failed to demonstrate that, if an interlocutory injunction was not granted P897 J15 to him, in the event that he was unsuccessful with his action, he would suffer irreparable damage which could not be atoned for by an award of damages. The appellant’s claim in this case is for a speci fied amount which can be atoned for by an award of damages. We therefore agree with the finding of the learned trial Judge that this was not a proper case for the Court to have granted the appellant the relief of an injunction. We find no merit in ground one and dismiss it. In ground two, the appellant has challenged the decision of the trial Judge to set aside his Writ of Summons and Statement of Claim for irregularity on grounds that it did not disclose a cause of action against the 2nd respondent. In considering this ground, we want to reiterate what we said in Wise Vs. Harvey7 when we held that: “a cause of action is disclosed only when a factual situation is alleged which contains facts upon which a party can attach P898 J16 liability to the other or upon which he can establish a right or entitlement to a judgment in his favour against the other”. In explaining what constitutes a cause of action, Order15/1/2 of the Rules of the Supreme Court, 1999 Edition provides thus: “The words have been defined as meaning simply a factual situation the existence of which entitles one person to obtain from the Court a remedy against another person”. According to the record in this case, after the learned trial Judge heard and considered the appellant’s application for an interim injunction on 28th September 2012, she not only dismissed the application but also set aside the appellant’s Writ of Summons and Statement of Claim for irregularity. In her ruling at page 12 of the record of appeal, the trial Judge stated that: “…in an application for an injunction the actual requirement is that the applicant must have a cause of action entitling him to relief…” She further stated at page 13 of the record that: J17 P899 “I have considered the Writ of Summons and Statement of Claim in this matter. Having perused the same, I find that they do not disclose a cause of action.” She continued at page 14 of the record to state that: “Having found that the Writ of Summons and Statement of Claim do not disclose a cause of action, I accordingly set aside the Writ of Summons and Statement of Claim for irregularity”. But on the record we note that the issue of the irregularity of the Writ of Summons and Statement of Claim was not before the Court at that stage. Therefore, even though the 2nd respondent filed an application to set aside the Writ of Summons and Statement of Claim, the same did not come up for determination before the learned trial Judge. What was before the Court was the appellant’s application for an injunction. Hence, it is our view that the learned trial Judge had no jurisdiction to make a determination on whether or not the Writ of Summons and Statement of Claim in question disclosed a cause of action against the 2nd respondent as that issue was J18 not before her. In this respect, we want to echo what we said in the Turnkey Properties Case5 when we held that it is improper for a Court P900 hearing an interlocutory application to make comments which may have the effect of pre-empting the decision of the issues which are to be decided on the merits. We also note that, according to the record, the parties were not heard on the main claim and the same still remains undetermined as the learned trial Judge dismissed the whole action at and interlocutory stage. In Wilson Masauso Zulu Vs. Avondale Housing Project Ltd, we held that: “The trial court has a duty to adjudicate upon every aspect of the suit between the parties so that every matter in controversy is determined in finality.” We therefore, find that the learned trial Judge fell in error and misdirected herself when she made an Order setting aside the Writ of Summons and Statement of Claim without having heard the 2nd respondent’s application on the same. For the above reasons, we find that ground three has merit and it succeeds. J19 As to whether or not the trial Judge had the power to order the amendment of the Writ of Summons and Statement of Claim under Orders 3 (2) and 18 of the High Court Rules, because of P901 the position we have taken regarding the Order by the trial Judge to set aside the process without hearing the parties, we are of the view that it would be inappropriate for us to consider that issue as the 2nd respondent’s application to set aside the same is still pending determination. Ground three is about the exercise of the powers of the trial Court to award costs. Under Order 40, Rule 6 of the High Court Rules, Cap 27 of the Laws of Zambia, costs are in the discretion of the trial Court and ordinarily follow the event, that is to say, that they are usually awarded to the successful party. The said rule reads as follows: “The cost of every suit or matter and of each particular proceeding therein shall be in the discretion of the Court or a Judge; and the Court or a Judge shall have full power to award and apportion costs, in any manner it or he may deem just, and, in the absence of any express direction by J20 the Court or a Judge, costs shall abide the event of the suit or proceeding: Provided that the Court shall not order the successful party in a suit to pay to the unsuccessful party the costs of the whole suit; although the Court may order the successful party, notwithstanding his success in the suit, to pay the costs of any particular proceeding therein.” P902 In YB and F Transport Limited Vs Supersonic Motors Limited9, this Court, in discussing the power of the Court to award costs, held that, costs may be awarded against a successful party if he did something wrong in the action or in the conduct of it. Our holding was in these terms: “The general principle is that costs should follow the event; in other words a successful party should normally not be deprived of his costs, unless the successful party did something wrong in the action or in the conduct of it.” We also discussed another exception to the general rule in Mutale Vs. Zambia Consolidated Copper Mines10 when we held that a successful party may be deprived of the costs of the J21 proceedings where his success is more apparent than real, for instance where only nominal damages are awarded. Thus, where a successful party has put the unsuccessful party to great expense and inconvenience, which is traceable to the former’s default, the costs need not follow the event and in such a case, P903 the Court may use its discretion to deprive the successful party of his costs. This is also in line with our decision in Water Wells Limited Vs. Wilson Samuel Jackson11. In this case, the appellant made an application for an Order for an interlocutory injunction against the 2nd respondent. After hearing both parties, the trial Judge dismissed the appellant’s application with costs. On the basis of our earlier decisions we have cited in this judgment, we take the view that the appellant, having been unsuccessful in his application for an interlocutory injunction, could not have been entitled to an award of costs. We also find no basis upon which the trial Judge could have deprived the respondent of its costs in this case. We J22 therefore cannot fault the decision of the trial Judge to award costs to the 2nd respondent. Ground three has no merit. All in all, grounds one and three have failed while ground two has succeeded. The determination of the Court below that the Writ of Summons and Statement of Claim, in this case, does not disclose a cause of action is hereby set aside. We also set aside P904 the Order setting aside the Writ of Summons and Statement of Claim. This appeal having only partly succeeded, we order that this matter be referred back to the same Judge in the Court below for determination of the 2nd respondent’s application to set aside the Writ of Summons and Statement of Claim and the main matter on the merits. We make no order as to costs. ………………………….……………………………….. L. P. CHIBESAKUNDA ACTING CHIEF JUSTICE J23 ……….……………………………… ……………………………………. …….. A. M. WOOD SUPREME COURT JUDGE M. LISIMBA ACTING SUPREME COURT JUDGE