Zyambo v Ntharzy (SCZ 16 of 2014) [2014] ZMSC 124 (28 April 2014)

SCZ Judgment No. 16 of 2014 (396) IN THE SUPREME COURT OF ZAMBIA APPEAL NO. 154/2011 HOLDEN AT LUSAKA (Civil Jurisdiction) BETWEEN: RICHARD ZYAMBO APPELLANT AND ABRAHAM SICHALWE NTHARZY RESPONDENT Coram: Chibesakunda, Ag. CJ, Mwanamwambwa and Muyovwe, JJS on the 5th June, 2012 and 29th April, 2014 For the Appellant: Mr. W. K. Cheelo, Messrs Wilson & Cornhill For the Respondent: Mr. G. Kalandanya, Messrs Douglas & Partners J U D G M E N T MUYOVWE, JS, delivered the Judgment of the Court Cases referred to: 1. Minister of Home Affairs, The Attorney General vs. Lee Habasonda (Suing on his own behalf and on behalf of Southern African Centre for the Constructive Resolution of Disputes (2007) Z. R. 207 2. Costa Tembo vs. Hybrid Poultry Farm Limited (2003) Z. R. 98 3. Lusanga Technical Services Zambia Limited vs. Miombo Limited Appeal No. 93/2003 4. New Plast Industries vs. Commissioner of Lands and the Attorney General (2001) Z. R. 51 5. Wilson Masauso Zulu vs. Avondale Housing Project Limited (1982) Z. R. 172 J1 (397) 6. State Lotteries Board of Zambia vs. Tembo (1988-1989) Z. R. 16 7. Christopher Lubasi Mundia vs. Sentor Motors Limited (1982) Z. R. This is an appeal against the Judgment of the Kitwe High Court in which the Court refused to order compensation to the appellant but ordered that vacant possession of Tanji Waterfalls Restaurant situate at Plot 8095 Stadium area, Solwezi be given to the respondent. The background to this matter is that the respondent initially commenced the action in the Solwezi Subordinate Court. The respondent filed a Writ of Summons together with a statement of claim on the 26th March 2010. However, the respondent amended his pleadings and filed the amended pleadings on 6th April, 2010. The claim was for: “1. Vacant possession of the building namely Tanji Waterfalls restaurant found on Plot 8095 Stadium Area, Solwezi Injunction Interest 2. 3. 4. Any other relief Court may deem fit 5. Costs” J2 (398) The appellant filed the Notice of Intention to defend and counter-claim on the 9th April, 2010. The appellant’s counter- claim was for: “a) payment of the actual economic value of the Restaurant constructed by the defendant (appellant) on the plaintiff’s (respondent’s) property b) damages for breach of contract c) d) costs” interest on all monies found due Meanwhile, the respondent applied for an ex-parte order of injunction and the same was granted. The ex-parte order was to restrain the appellant, his servants, agents or whosoever, from continuing demolishing the building namely Tanji Waterfalls restaurant and also to compel the appellant, his agents or whosoever, to replace the roof, kitchen cabinets and ceiling board on the property in issue. At the inter-parte hearing, Counsel for the appellant raised a preliminary issue regarding the jurisdiction of the Court. On 6th May, 2010 the learned Magistrate discharged the ex-parte injunction earlier granted to the respondent and transferred the matter to the High Court and ordered costs against the respondent. J3 (399) Following the Order of transfer by the Subordinate Court, the record of appeal shows that on the 21st May, 2010 the respondent appealed to the High Court against the said Ruling. The appeal focused mainly on the discharge of the injunction and the costs granted to the appellant. The learned Judge considered the appeal and upheld the Order of the Magistrate to transfer the case to the High Court. According to the learned Judge, the Magistrate was on firm ground to order costs against the respondent since he had commenced the case wrongly, thereby putting the appellant to unnecessary costs. The learned Judge proceeded to make Orders for Directions. After close of pleadings, the matter went to trial. After hearing both parties, the facts which were accepted by the learned Judge were that pursuant to a lease agreement between the parties dated 30th September, 2008, the respondent leased part of his land, being Plot 8095 Stadium area in Solwezi, to the appellant to construct a restaurant. That the appellant was J4 to use the said restaurant for the period equivalent to the cost of (400) construction, thereafter surrender the property to the respondent. It was agreed between the parties that the cost of construction would be K128,000,000.00 and the monthly rent was agreed at K400,000.00. That the agreed rental would be deducted on a monthly basis, from the sum of K128,000,000.00. That the said rental charge was subject to review by the respondent after giving the appellant 30 days notice of intention to do so. That for the period the appellant would be in occupation of the demised premises, he was not to sublet the property without the written consent and approval of the respondent. The Court accepted that in February, 2009, in accordance with the agreement between the parties, the respondent informed the appellant of his intention to increase the monthly rent from K400,000.00 to K3,500,000.00, which the appellant rejected and that the issue was never resolved. The respondent later noticed that the appellant was removing materials from the structure, such as ceiling boards, roofing sheets and cupboards. The Court accepted that the J5 appellant did this after discovering that the respondent had pledged his title deed for the said plot to Citizenship Economic Empowerment Commission (CEEC), as collateral for the loan he had obtained to expand (401) his lodge. According to the learned trial Judge, by removing materials the appellant opted out of the agreement. The lower Court, after analyzing the evidence, found in favour of the respondent and ordered vacant possession of the building in the state it was in at the time of judgment. The learned Judge refused to award the appellant any compensation and he awarded costs to the respondent. Dissatisfied with the Judgment of the Court below, the appellant appealed to this Court, advancing six grounds of appeal namely: 1. The Court below erred in fact and law by refusing to award compensation to the appellant when the parties hereto have no dispute with the principle of compensation as evidenced in paragraph 5 of the respondent’s amended statement of claim as what J6 was in dispute was the quantum of the compensation. 2. The Court below erred in law in not awarding Judgment to the appellant on the counter-claim when there was no defence on the record to the same. The Judge further erred in law by refusing to grant any relief on (402) the appellant’s counter claim even as there was no defence by the appellant. 3. The Court below erred in law by awarding costs in this Court and the Court below to the respondent when he 4. had earlier in his Judgment dated 18th October, 2010 awarded costs in the Court below to the appellant. 5. That the Court below erred in law in considering the appeal from the Magistrate Court as the Magistrate Court had no jurisdiction and the commencement of the action therefore was void abinitio as the matter of Section 20(1) of the Subordinate Courts Act Chapter 28 of the Laws of Zambia is a matter of law and not procedure and any breach thereof renders the proceedings a nullity. 6. That the Court below erred in law and fact by not taking into account the evidence on record that the appellant had in fact repaired the damage he had caused to the building. 7. The Judgment of the Court below went against the weight of the evidence on record. J7 On behalf of the appellant, Counsel filed Heads of Argument. In ground one, he submitted that the undisputed cost of construction of the building was K128,000,000.00 which at K400,000.00 rental per month, translates into 320 months which period the appellant did not exhaust. It was argued that when the appellant threatened to remove some materials from the building, the respondent offered to pay the appellant K70,000,000.00 but the appellant rejected the amount offered and instead demanded to be paid K90,000,000.00. It was contended that because (403) the respondent refused to pay him the money he had demanded, the appellant went ahead and removed the roofing sheets, ceiling and cupboard in the storeroom. It was submitted that, however, after the rainy season, the appellant rebuilt the roof timbers and put back the sheets and was in the process of fixing the ceiling board when an injunction was issued against him. Counsel contended that it was not the whole building which was demolished but only that some materials were removed. He argued that as such, it was prudent for the Court below to order an assessment taking J8 into account the fixtures that had been removed and not replaced. It was submitted that the learned Judge in the Court below, therefore, erred and misdirected himself when he failed to hold that the appellant should be paid a certain sum following assessment. Counsel prayed that this ground of appeal be allowed. In arguing ground two, it was submitted that the Court below should have entered Judgment in favour of the appellant, as there (404) was no defence on the counter-claim by the respondent. It was argued that the Court below did not do an assessment of the evidence adduced on the counter-claim to establish whether the appellant had proved his case on a balance of probabilities, especially in view of the fact that it was not in dispute that the appellant built a restaurant on the respondent’s premises. It was contended that had the Court below addressed its mind to the issues in this ground, he would have inevitably found for the appellant. Counsel relied on the case of Minister of Home Affairs, The Attorney General vs. Lee Habasonda (Suing on J9 his own behalf and on behalf of Southern African Centre for the Constructive Resolution of Dispute.1 Counsel prayed that this ground be allowed. In ground three, it was submitted that the Court below in its Judgment dated 18th October, 2010 awarded costs to the appellant. Counsel referred us to page 65, lines 23 to 25 of the record of appeal in which the Court below said that: (405) “As for costs, it is clear that the plaintiff had commenced the action at a wrong forum thereby exposing the defendant to unnecessary expenses. In the circumstances, the lower Court’s order as to costs was also proper and is hereby upheld.” Counsel contended that it is trite law that generally, a successful candidate is entitled to costs, unless there are good reasons guaranteeing a departure from the norm. It was submitted that as commencement of the action in the Subordinate Court was a mistake by the respondent, the appellant was entitled to costs. Counsel relied on the case of Costa Tembo vs. Hybrid Poultry Farm Limited2 in which this Court held that a successful litigant is entitled to costs. J10 It was argued that as regards costs, there were no convincing reasons why the lower Court reversed its earlier decision of 18th October, 2010. Counsel prayed that this ground be allowed. In ground four, Counsel submitted that the respondent improperly commenced his action in the Subordinate Court in view of the quantum of the claim which was in excess of K128,000,000.00 when the jurisdiction of the Subordinate Court of (406) the first class was K30,000,000.00. It was argued that the High Court Judge should not have considered the appeal from the Subordinate Cour t as the proceedings in the Subordinate Court were a nullity, and that consequently, the proceedings in the Court were also a nullity. Counsel contended that although a litigant has the liberty of commencing his action in the Court of their choice, due regard has to be given to the nature of relief being sought in making that choice. Counsel relied on the case of Lusanga Technical Services Zambia Limited vs. Miombo Limited.3 Further, it was submitted that the Magistrate, pursuant to Section 20(1)(c) of the Subordinate Court Act Chapter J11 28 of the Laws of Zambia, referred the matter to the High Court having realized that it had no jurisdiction. It was submitted that the learned Judge erred when it upheld the Magistrate’s order to refer the case to the High Court and that, therefore, the proceedings in the Subordinate Court and High Court were void ab initio. It was Counsel’s argument that the mode of commencement of any action is generally provided by the relevant (407) statute and he relied on the case of New Plast Industries vs. Commissioner of Lands and The Attorney General.4 In ground five, it was submitted that while it was admitted that the appellant removed the roofing sheets, ceiling and cupboards, there was evidence that the appellant later replaced some of the removed materials and as such the Court below ought to have taken this evidence into account. Counsel contended that the restaurant having been worked on, the respondent is entitled to occupation and use of the premises and that the appellant must also benefit from the structure which he J12 built on behalf of the respondent. It was argued that the rules of equity should have been applied in this case so that the appellant could be paid for expenses incurred for its construction. Counsel prayed that this ground of appeal be allowed. With regard to ground six, Counsel submitted that it had been well covered in all the other grounds earlier argued. Counsel for the respondent also filed Heads of Argument. In responding to ground one, Counsel argued that the trial Judge was (408) on firm ground in not awarding compensation to the appellant. Counsel argued that the whole action was anchored on the Lease Agreement between the parties. It was submitted that the issue of compensation was not one of the reliefs sought in the Court below, and as such, the Court was on firm ground in not making any Order as to compensation. Counsel contended that the appellant himself argued in his pleadings that the issue of compensation or offer was extraneous to the written lease agreement and was, therefore, not an issue in the Court below. J13 In response to ground two, it was submitted that despite the lack of defence on the part of the respondent, the appellant still had a duty to prove his case on the balance of probabilities to be entitled to judgment in his favour. It was argued that the appellant ought to have proved his case and show that he was entitled to the remedies sought, and not claim for remedies merely on the absence of a defence by the respondent. Counsel contended that the appellant’s counter-claim was not a liquidated claim but that it was covered under Order XII Rule 8 of the High Court Rules Chapter 27 of the Laws of Zambia which provides that: (409) “In all actions not otherwise specifically provided for by the other sub-rules, in case the party served with the Writ of Summons does not appear within the time limited for appearances upon the filing by the Plaintiff of a proper Affidavit of service, the action may proceed as if such party had appeared.” Counsel also cited the case of Wilson Masauso Zulu vs. Avondale Housing Project Limited5 adding that a perusal of the Judgment appealed against shows that the learned Judge dealt with the counter-claim and found that it had not been J14 proved and accordingly dismissed it. It was Counsel’s prayer that this ground should fail. Turning to ground three, which related to the award of costs, it was submitted that at trial, the respondent succeeded and was accordingly awarded costs. It was submitted that the awarding of costs is in the discretion of the Court which can award them in an interlocutory matter or at the end of the trial to a successful litigant. Counsel argued that the appellant had not shown that in awarding costs, the Court below did not exercise its discretion judiciously. (410) In response to ground four, Counsel submitted that the matter did not go to the High Court as an appeal and that neither was it heard as an appeal but as a fresh hearing. He argued that in fact, the parties in the Court below were referred to as plaintiff and defendant. It was submitted that the transfer of the matter from the Subordinate Court to the High Court was appropriate in view of the circumstances of the matter and considering that the High Court had jurisdiction. It was contended that the argument by the J15 appellant that the proceedings in the Court below were a nullity was misconceived. Counsel further argued that in the Court below, the appellant did not raise the issue of jurisdiction but argued their case and even raised a counter-claim. It was contended that the appellant could not raise the issue of jurisdiction or appropriateness of the matter in this Court. In response to ground five and six, Counsel submitted that there was overwhelming evidence that the appellant breached the lease agreement when he tore down the building after learning that the respondent had obtained a loan using the title for the plot in issue, and that this was after the demand to be paid back his money failed. Counsel submitted that the lease agreement did not prohibit the respondent from taking out a mortgage using the (411) plot as collateral. It was contended that the Court below, as is required by law, gave effect to the terms agreed upon by the parties to a contractual relationship as enunciated in the case of State Lotteries Board of Zambia vs. Tembo.6 Counsel submitted J16 that the Court below was on firm ground in finding for the respondent as the appellant was the one in breach of the lease agreement and prayed that the appeal be dismissed with costs. We have considered the evidence in the Court below, the Judgment appealed against and the Heads of Argument by learned Counsel for the parties. We will deal with all the grounds of appeal simultaneously for reasons that will become apparent in this judgment. We have perused the record and notably, in transferring the matter to the High Court, this is what the Magistrate had to say in his Ruling: “It is not in dispute that the plaintiff has failed to show why such an order should have been granted to protect him. This (412) was in the light of overwhelming evidence that this Court has no jurisdiction to entertain the matter because he was privy to the facts in issue. As such I discharge the order earlier granted, award costs to the defendant for an erroneous ex-parte application in light of the aforesaid and refer the matter to the High Court for hearing as in this case and in light of Section 20 (1) of the Subordinate Court Act Cap. 28. The claim exceeds the Subordinate Court’s jurisdiction.” J17 The respondent appealed against the Ruling of the Subordinate Court on the following grounds: “The learned Magistrate erred in Law and fact by discharging the injunction on 6th May 2010 when the injunction was applied for and obtained for in good faith to protect the interest of both parties by preventing defendant from demolishing the Tanji Water Falls Restaurant building which building can even be used by defendant to recover his money spent on effecting it and that, now that injunction is not there defendant can go back and continue demolishing the building until it remains only a mere plot in which case the plaintiff cannot pay what defendant wants to recover from plaintiff causing a loss on part of both parties.” The learned Magistrate erred in Law and fact when he ordered the plaintiff to pay costs when the action and injunction was so obtained in good faith in the interest of justice and both parties, it does not serve his interest alone, it is beneficial to both. Any other grounds to follow later.” In his judgment on appeal dated 18th October 2010, the learned Judge said, inter alia, that: (413) “In my view, the Court below took the proper course as regards its jurisdiction. This is on account of the fact that this was an action for, inter alia, the recovery of land whose value or annual rental value was, according to the Pleadings and affidavits on the record, in excess of K128,000,000=00 and K48,000,000=00 respectively. The matter shall accordingly be heard and determined by the High Court in accordance with the order for directions issued with this judgment.” J18 Now, looking at the sequence of events, it is clear to us that the learned Magistrate erred when he transferred the case to the High Court. Section 20 (1) of the Subordinate Court Act does not clothe a magistrate with power to transfer a case to the High Court for lack of jurisdiction. Certainly, if this was the case, the High Court would be inundated with cases from the Subordinate Court. The correct position is that, the Magistrate having found that he had no jurisdiction, should have dismissed the case before him. Therefore, the learned trial Judge misdirected himself when he upheld the transfer of the case from the Subordinate Court to the High Court. We must state that we find nothing wrong, however, with the Order for costs against the respondent who had commenced the action in the wrong Court. In a nutshell, the learned Judge should have set aside the Order of transfer and also dismissed the appeal before him. It (414) was certainly erroneous for the learned Judge to proceed to hear the matter in the manner he did. J19 First of all, the Orders for Directions issued by the learned Judge were as follows: “1. That the Reply and Defence to counter-claim (if any) be delivered within 10 days of the date hereof. 2. That discovery be by list within 10 days of the notice requiring the same. 3. That inspection be within 10 days after the notice. 4. That filing the bundles of pleadings and Documents within 10 days after the close of the pleadings. 5. That trial be before a Judge sitting alone at Kitwe 14 days after filing bundle of pleadings and Documents. 6. That each party be at liberty to apply. 7. That costs be in the cause.” Clearly, the learned Judge issued Orders for Directions beginning at the “Reply and Defence to counter-claim” stage. This was a misdirection. It is clear from the Order for Directions that although the learned Judge heard the matter de novo, the pleadings which the parties relied on were those filed before the Subordinate Court. There were no fresh pleadings filed in the High Court. This was certainly wrong procedure and for which there is no legal backing. The correct procedure should have been that, after satisfying himself that he had jurisdiction, the learned Judge J20 (415) should have ordered the parties to file fresh pleadings in the High Court. Be that as it may, we must admonish the appellant for raising this issue before us after submitting himself to the jurisdiction of the lower Court. If the appellant was not satisfied with the Ruling of the learned Judge on their preliminary issue, he should have appealed against the learned Judge’s Ruling dated 18th October 2010. But he did not. In fact, it appears the learned Judge treated the matter before him both as an appeal and as a case which had been referred to him by the Subordinate Court. This is evidenced by the cause number and also by the reference to the parties as “appellant and respondent”. Quite clearly, this is a case which was beset with procedural hiccups which went to the very root of the case. Both parties submitted themselves to the jurisdiction of the High Court but did not file any pleadings. The importance of pleadings has been (416) J21 emphasized in a plethora of cases such as the case of Christopher Lubasi Mundia vs. Sentor Motors Limited7 where we said: “(ii) The function of pleadings is to give fair notice of the case which has to be met and to define the issues on which the court will have to adjudicate in order to determine the matters in dispute between the parties.” This case was headed for the High Court had it been dismissed by the Subordinate Court but it should have proceeded in the proper manner. Our emphasis is on the fact that both parties submitted themselves to the jurisdiction of the High Court and both cannot be heard to complain. The fact that there were no pleadings filed before the High Court worked against both parties, in our view. In the circumstances, we take the view that the justice of the case demands that the same be sent back to the High Court for retrial before another High Court Judge and we so order. Before we end, we wish to address the question of costs raised by the appellant. Counsel for the appellant argued that the learned Judge deserted his earlier decision of 18th October, 2010 J22 with regard to costs. Our response is that it is trite that costs follow the (417) event and are granted at the Court’s discretion. Counsel for the appellant should not forget that at the High Court level costs were awarded to the successful party. We see no basis for the argument raised with regard to costs in the Court below. As regards this appeal, we make no Order for costs. ……………………………..…….……….. L. P. CHIBESAKUNDA ACTING CHIEF JUSTICE …………………………………………….. M. S. MWANAMWAMBWA ACTING DEPUTY CHIEF JUSTICE J23 …………………………..………………. E. N. C. MUYOVWE SUPREME COURT JUDGE J24