Rosemary Mulenga Lombe v Investrust Bank Plc (Application 16 of 2022) [2022] ZMCA 152 (31 August 2022)

IN THE COURT OF APPEAL OF ZAMBIA HOLDEN AT LUSAKA ( Civil Jurisdiction) Application 16 of 2022 CAZ/08/274/2021 IN THE MATTER OF: IN THE MATTER OF: AN APPLICATION UNDER ORDER 30, RULE 14 OF THE HIGH COURT ACT, CHAPTER 27 OF THE LAWS OF ZAMBIA THE PROPERTY IN A THIRD-PARTY MORTGAGE RELATING TO S/D "96" S/D "A" OF FARM 841, SITUATE IN THE COPPERBELT PROVINCE OF THE REPUBLIC OF ZAMBIA IN THE NAME OF ROSEMARY MULENGA LOMBE IN THE MATTER OF: · FORECLOSURE, POSSESSION AND SALE OF THE MORTGAGED PROPERTY BETWEEN: ?\)\>UC OF lAMs ~ lOF~ ROSEMARY MULENGA AND Ll_F- Applicant . B~ 1 AUG 2022 '-.... CtVIL REG1sJRYl / ~~ . ~ : / · 80x 50067. L\l':i,... INVESTRUST BANK PLC Respondent CORAM: Ngulube, Siavwapa and Sharpe-Phiri, JJA On 26th May 2022 and 31st August 2022 For the Applicant: Mr. B. Gondwe of Messrs Buta Gondwe & Associates For the Respondents: Mr. C. Hamwela and Ms. C. Kate be of Messrs Nchito & Nchito RULING SHARPE-PHIRI, JA, delivered the Ruling of the Court Rl Legislation referred to: 1. The High Court Rules, Chapter 27 of the Laws of Zambia 2. The Court of Appeal Act, No. 7 of 2016 of the Laws of Zambia 3. The Constitution of Zambia, Chapter 1 of the Laws of Zambia Cases referred to: 1. Finance Bank of Zambia v Noel Nkhoma Appeal No. 77 of 2015 2. BP Zambia v Interland Motors Limited (2001) Z. R. 37 3. Nyampala Safaris (Z) Limited and 4 others v Zambia Wildlife Authority and 6 others (2004) Z. R . 49 1.0 INTRODUCTION 1.1 On 8 th April 2022, the applicant has moved this Court by notice of motion pursuant to Section 9 of the Court of Appeal Rules, 2016. She seeks to renew the application for stay of execution declined by a single Judge of this Court on 31 st March 2022. 1.2 The endorsement on the notice however reads that the applicant seeks to set aside the ruling of Banda-Bobo, J of 31 st March 2022 by which she declined a stay of execution of the judgment relating to S/D 96 of S/D A of Farm 841 situate in the Copperbelt Province, pending determination of the appeal. 1.3 The motion is supported by an affidavit filed on 5 th April 2022, sworn by one Buta Gondwe; the legal counsel seized with conduct of the matter in which he states that the applicant seeks a stay of execution of a judgment of the High Court dated 24th June 2021, pending appeal before this Court. R2 1. 4 The grounds of the application stated therein are that the applicant's appeal has good prospects of success and will be rendered nugatory if a stay is not granted; that the applicant will suffer irreparable damage if the property, the subject of the appeal is sold and that a stay is warranted in this matter. 2.0 BACKGROUND 2 .1 A perusal of the record shows that an action was commenced by the respondent in the Kitwe High Court under cause number 2012/HK/215 against 8 respondents who included the applicant herein as the 2 n d respondent, for debt recovery and fore closure among other reliefs. 2.2 An appeal was lodged to the Supreme Court against the judgment of the lower Court under cause SCZ / 8 / 194/2015, wherein judgment was issued on 12th June 2018, affirming the 1st respondent's indebtedness. However, no specific orders for enforcement of guarantees by the 2nd respondent (applicant herein) were made as seen on page J 15 of the judgment. 2.3 After the judgment, the respondent herein moved another motion before the Supreme Court under the slip rule under the same cause seeking that the Court review its earlier judgment for failure to consider property S/D '96' of S/D 'A' of Farm 841, Kitwe (property subject of this motion). The motion was dismissed by the Court. R3 2.4 Another action was commenced in the High Court for Zambia, Commercial Division under cause number 2020 / HPC / 0944 by the respondent herein against the applicant seeking payment of KlS,278,607.75 and US $5,569.39 plus interest, costs and charges due to the respondent under credit facilities availed to the applicant. The respondent also sought to foreclose on the mortgaged property known as subdivision 96 of subdivision A of C Farm No. 841, Copperbelt. 2 .5 On 24th June 2021, the learned Judge in the High Court entered judgment in favour of the respondent, ordered the applicant to repay the debt in 180 days failing which the respondent would be entitled to foreclose and take possession of the Mortgaged property. 2.6 The applicant lodged an appeal against the said judgment and subsequently sought a stay of execution of the said judgment on the basis that the appeal had good prospects of success and the applicant would be prejudiced if the stay was not granted. After determining the application, the learned Judge found that the prospects of the appeal succeeding were fanciful and that the properties dealt with in the earlier matters in the High Court and Supreme Court were not the subject of the matter under the Commercial Division of the High Court. The Judge found that the respondent had failed to show special circumstances warranting the grant of the stay of execution and accordingly declined the application. R4 2.7 The applicant renewed the same application before s single Judge of this Court. In the application, it was contended that her appeal to this Court has high prospects of success and that it would be rendered nugatory if a stay of execution was not allowed. The applicant rode on the backdrop that the action in the High Court which culminated in the Judgment of 24th June 2021 was res judicata having been determined in previous proceedings up to the Supreme Court resulting in the earlier judgement of 12th June 2018. On this basis, it was argued that the prospects of the appeal succeeding were high. 2.8 The single Judge of this Court having considered and appreciated the history of the dispute and the application before her, rendered her decision on 31 st March 2022, in which she dismissed the applicant's renewed application for stay of execution. She noted that the matter before her was not res judicata, as the subject property was never a subject of proceedings in the other matter before the Supreme Court. She found that there were no special circumstances warranting the grant of stay of execution as the appeal had no prospects of succeeding. 2.9 Being aggrieved with the said decision, the applicant has brought a motion to the full bench of this Court. The renewed application for stay was prompted by an unsuccessful application for stay of execution before a single Judge of this Court. RS 3.0 THE NOTICE OF MOTION AND AMENDMENT APPLICATION 3.1 By this notice of motion filed on 8th April 2022, the applicant sought a renewed application for a stay of execution and to set aside the ruling of a single Judge of this Court dated 31st March 2022. The ruling declined a stay of execution of Judgment relating to S/D 96 of S/D A of Farm 841 situate in the Copperbelt Province pending determination of the appeal. 3.2 It was the applicant's deposition that Banda-Bobo, J refused to grant the stay of execution on the basis that there was no order made in relation to the subject property adding that the same was not adjudicated upon. She found that there were no special circumstances warranting the grant of stay of execution. 3.3 The applicant further deposed that he has now been instructed to renew the application before the full bench as the appeal had prospects of succeeding. Further, that the stay of execution pending determination of appeal is warranted otherwise the property subject of these proceedings' risks being sold making the applicant to suffer irreparable damages. 3.4 The gist of these arguments is that there was an appeal pending determination before the Court of Appeal which had high chances of success and if the judgment of the High Court was not stayed, the appeal would be rendered academic. R6 3.5 The applicant further contended that there had been 3 previous judgments, one from the Kitwe High Court dated 27th February 2015 and two from the Supreme Court dated 12th June 2018 and 28th October 2020, all relating to the same subject matter, being the third-party mortgages. The judgment of the Lusaka High Court of 24th June 2021 constitutes the 4th judgment herein. 3.6 The applicant also averred that the respondent's submissions of the principle of res judicata were misconceived as the Supreme Court had in the cases of Finance Bank of Zambia v Noel Nkhoma 1 and BP Zambia v Interland Motors Limited2 confirmed that all claims and issues which should have been raised in the initial action so as to ensure that there is finality to litigation must be included. 3.7 In opposing the motion, the respondent through its Director of Credit, filed an affidavit in opposition of motion on 24th May 2022. He contended that there has never been a final determination in relation to the subject property such that the matter before the High Court was not res judicata. He added that the applicant's application has no prospects of success as it does not present any special circumstances to warrant granting of stay of execution. 3.8 Before this motion could be heard, the applicant brought another application on 13th May 2022 by way of summons for an order to amend their application for stay due to changed circumstances, being that the respondent had since taken possession of the R7 subject property. In the affidavit in support, the deponent stated that despite serving the respondent with the notice of motion under determination herein, on 13th April 2022, the respondent proceeded to file a writ of possession which was executed on 27th April 2022. 3 .9 The deponent indicated that if the stay of execution is not granted, the appeal would be rendered nugatory. Further, that the appeal was based on the ground of res judicata, among others, as the High Court had no jurisdiction to pass judgment on 24th June 2021. 3.10 The applicant also deposed that if the appeal was successful, there would be no monies due and payable nor any liability accruing to her property. She added that the respondent's actions were meant to pre-empt the appeal and proceed as though this matter has been finally determined, when in fact not. 3.11 The respondent opposed the application for leave to amend by affidavit in opposition dated 24th May 2022 arguing that the applicant had not indicated which portions of the motion she wished to amend. 3.12 The respondent confirmed that it had filed a writ of possession on 12th April 2022 and a Sheriffs seizure form was filed on 27th April 2022 whereas the applicant had only served the application on it on 13th April 2022. R8 3.13 The respondent added that the filing of an application for a stay of execution of judgment is not equivalent to obtaining an order to stay the execution. Therefore, in the absence of an order for stay of execution, the respondent had no legal obligation to refrain from enforcing the judgment of 24th June 2021. Therefore, the respondent could not be faulted for filing a writ of possession before an order for stay had been granted. It added that both the application for leave to amend its renewed application for stay as well as the renewed application for stay of execution itself have been overtaken by events as execution has already been effected and there is nothing to be stayed. 3 .14 The gist of the respondent's arguments of 24th May 2022 was that the applicant's application ought to fail for failing to meet two thresholds required for grant of stay, namely, that the applicant must demonstrate that the appeal had high prospects of success and that there must be sufficient or special reasons which justify the granting of the stay. ' 3.15 The respondent added that there were no special circumstances warranting the grant of stay and that the applicant's ground of appeal which was premised on res judicata had no prospect of succeeding as the Kitwe High Court matter and the Supreme Court matters never dealt with the subject in contention before the Lusaka High Court under cause number 2020/HPC/0944. R9 3.16 The Court then reserved its Ruling after hearing the second application on 19th August 2022. 4.0 DECISION OF THIS COURT 4 .1 Having reserved our ruling on the two earlier applications, we now render our ruling in the matter. 4.2 We begin firstly by addressing the amendment application in the summons filed on 13th May 2022 seeking to amend the earlier motion due to changed circumstances, namely, that the respondent has since taken possession of the subject property. 4.3 The parties' submissions on this application have already been elucidated earlier. Although the respondent opposed this application, it is our view that the amendment is minor and will not prejudice the respondent in any way. Further, it is trite that a party has an obligation to bring all relevant facts which ought to be considered to the knowledge of the Court in a timely manner. It is in this light that we allow the said application to amend in that respect. 4. 4 In addressing our mind to the notice of motion before us as amended, we have observed that the proceedings before the High Court which culminated in the judgment of 24th June 2021 , entered in favour of the respondent declared the applicant to be R 10 indebted to the respondent in the sums of KlS,286, 173.22 and US$5 ,569.39 respectively. 4.5 The High Court directed the applicant to settle the said debt within 180 days and in default the respondent be entitled to foreclose and take possession of the subject property. 4 .6 The applicant filed an appeal to this Court for among other grounds that the proceedings in the High Court were res judicata as the subject property was a subject of determination in earlier proceedings which resulted in the decision of the Supreme Court dated 18th June 2018. 4 .7 Pending this appeal, the applicant applied for a stay of execution of the judgment before the High Court which application was unsuccessful thereby prompting a renewed application before the single Judge of this Court. The application before the single Judge was also unsuccessful hence the application for a stay of execution being renewed before the full bench. 4.8 In addressing the motion before us, now amended, we are cognizant of the fact that the Supreme Court has previously pronounced itself on principles for grant of stay in the case of Nyampala Safaris Zambia Limited, and others v Zambia Wildlife Authority, and others3 when it held that: R 11 'A stay of execution is granted on good and convincing reasons. The rationale of this position is clear. Which is that a successful litigant should not be deprived of the fruits of litigation as a matter of course. The application must therefore clearly demonstrate the basis of which a stay should be granted.' 4.9 Similarly, in the case of Mulenga and Another V Chainama Hotels Limited and Others, the Supreme Court expounded that: 'a successful party should only be denied immediate enjoyment of a judgment debt only on good and sufficient grounds.' 4.10 The foregoing authorities illustrates that a stay of execution should only be granted on good and sufficient grounds. 4 . 11 Therefore, the question for our consideration is whether the applicant has demonstrated good and compelling reasons to set aside the ruling of a single judge of 31st March 2022 and to sustain the stay of execution. 4 . 12 We have perused the record and the grounds of appeal. The evidence in relation to execution and sale which we find as proved from the affidavit depositions is that after the application to stay execution in the High Court was denied, the respondent proceeded to file a writ of possession on 12t h April 2022. R 12 4.13 As no order for stay has ever been granted to this date, the respondent proceeded to take possession of the subject property prompting the applicant to file summons to amend the first motion due to changed circumstances. Subsequently, the respondent advertised the subject property for sale as can be seen in the newspaper advert exhibited by the applicant which advert is dated 10th August 2022. 4.14 The applicant contends that the pending sale should be stayed as the appeal which has high prospects of succeeding risks being rendered academic. The contention by the applicant is that the issues in contention, namely, the subject property, was a subject of determination before previous proceedings which went up to the supreme Court hence the proceedings in the High Court leading up to the Judgment of 24th June 2021 were a nullity as the matter there in was res judicata, a ground which is said to be the subject of consideration in the appeal. 4.15 Without delving into the merits of the appeal, we have noted the principal argument of the applicant that the subject property was previously dealt with in the Kitwe High Court and the Supreme Court and hence the High Court, Commercial Division had no jurisdiction to deal with the property. R13 4.16 The further evidence reveals that the applicants issued a writ of possession in the High Court on 12th April 2022 before being served with an application for stay of execution on 13th April 2022 and that execution has taken place and the respondent has taken possession of the property in question. 4.17 In the circumstances, we find that the applicant has failed to demonstrate convincing and compelling reasons to justify the exercise of our discretion to grant a stay of execution of the judgment which is partially enforced. We also do not think the appeal has reasonable prospects of success. 4.18 Further, staying execution will unduly prejudice the respondent and prevent it from enjoying the fruits of its judgment contrary to the set principle of law. We are therefore of the view that this is not a proper case to exercise our discretion to set aside ruling of a single Judge and to grant a stay of execution. 5.0 CONCLUSION 5.1 For the foregoing reasons, the motion to set aside ruling of a single Judge of 31st March 2022 and for a stay of execution is unsuccessful. The application is accordingly dismissed with costs to the respondent, to be agreed and in default to be taxed. R 14 5.2 It follows that our interim order of 19th August 2022 granting a stay of sale of the property falls away forthwith . P. C. M Ngulube COURT OF APPEAL JUDGE M. J. iavwapa ~h a rp e - fu r i COURT OF APPEAL JUDGE COURT OF APPEAL JUDGE R 15