Zambia National Commercial Bank PLC v Mweemba (Appeal 92 of 2013) [2017] ZMSC 286 (31 August 2017)

jL < IN THE SUPREME COURT FOR ZAMBIA APPEAL NO.92/2013 HOLDEN AT LUSAKA (Civil Jurisdiction) BETWEEN: ZAMBIA NATIONAL COMMERCIAL BANK PLC APPELLANT AND JASON MWEEMBA RESPONDENT CORAM: Mwanamwambwa DCJ, Wood and Malila JJS. On 11th July, 2017 and 31st August, 2017. For the Appellant: Mr. B. Gondwe - Messrs Buta Gondwe and Associates For the Respondent: Mr. M. L. Mukande SC - Messrs ML Mukande and Company RULING WOOD, JS, delivered the Ruling of the Court. Case referred to: (1) Scherer and another v Counting Instruments Ltd and another (1986), 1 WLR 615 CA (2) Collet v van Zyl Brothers Limited (1966) ZR 65(CA) (3) Rodwell Kasokopyo Musamba v M. M. Simpemba (1978) ZR 175 (HC) (4) Mutale v Zambia Consolidated Copper Mines (1993-1994) ZR 94(SC) (5) Costa Tembo v Hybrid Farm (Z) Limited (2003) ZR 98 Legislation referred to: R2 (1) Rule 77 of the Supreme Court Rules Cap 25 of the Laws of Zambia Other works referred to: (1) Halsburys Laws of England Volume 4th Edition paragraphs 714,717 This is a motion by the appellant seeking an interpretation of our judgment on the question of who should bear the costs in the court below, given that the appellant had substantially succeeded on appeal. It is necessary, in our view, to give a synopsis leading to this motion. On 24th September, 2012, the Industrial Relations Court entered judgment in favour of the respondent for his pension benefits together with the sum of K20,000.00 and interest on damages which were not claimed. In addition, the lower court awarded the respondent costs to be taxed in default of agreement. On appeal, the appellant raised four grounds of appeal. We dismissed the first ground for having no merit but agreed with the appellant that the second and fourth grounds of appeal had merit. With regard to the third ground of appeal we found that there was partial merit. R3 A perusal of the judgment reveals that even though the first ground of appeal was dismissed it related to a peripheral issue relating to substantial justice. As such, it did not go to the root of the appeal. The third ground basically dealt with the general question of whether damages should have been pleaded. Even though the third ground was only partially successful, the main point it achieved was to set aside the award for K20,000.00 which in effect was the appellant’s desired aim. What we did not agree with in the third ground was the argument relating to how general damages should have been pleaded. Even though we disagreed with the appellant, we came to the conclusion that there was no basis for the award of K20,000.00 as damages and accordingly set it aside. On appeal, in our judgment delivered on 18th January, 2016, we essentially set aside the judgment of the Industrial Relations Court and ordered the parties to bear their respective costs relating to the appeal. Less than a month after our judgment was delivered, the appellant’s advocates received a demand for K462,500.00 from R4 the respondent’s advocates, being in respect of their costs incurred in the Industrial Relations Court. This prompted the appellant to seek an interpretation of judgment as it believed that no costs were due to the respondent. Mr. Gondwe has, on behalf of the appellant, argued that the general rule on costs is that costs follow the event. He supported his argument with a quotation from the case of Scherer and another v Counting Instruments Ltd and another1 where the Court of Appeal held that: “The general rule in relation to costs was that costs normally followed the event. Accordingly, the party who, as it turned out, had unjustifiably brought the other party before the court or had given the other party cause to have recourse to the court to obtain his rights was required to recompense the other party’s costs. However, that was subject to the judge’s unlimited discretion under Section 50 of the 1925 Act to make what order as to costs he considered the justice of the case required and consequently a successful party’s reasonable expectation of obtaining an order for costs depended on the exercise of the court’s discretion. The judge was required to exercise his discretion judicially, i.e. in accordance with established principles and in relation to the facts of the case and on relevant grounds connected with the case, which included R5 any matter relating to litigation, the parties’ conduct in it and the circumstances leading to the litigation; but nothing else. If there were no grounds for departing from the normal rule or the judge acted on extraneous grounds he had in effect not exercised his discretion at all and a dissatisfied party was entitled to appeal to the Court of Appeal, notwithstanding that the judge had not given leave and his award of costs would otherwise be final by virtue of s 31(1) (h) of the 1925 Act. Since the defendants had not succeeded in their applications, and since, on the facts, there was no material before the judge which justified him ordering the plaintiffs to pay the costs, the plaintiffs’ appeal would be allowed and the costs order would be discharged. ” Mr. Gondwe also referred us to a number of decisions by this Court and other courts such Collet v van Zyl Brothers Limited2 ; Rodwell Kasokopyo Musamba v M. M. Simpemba3 and Mutale v Zambia Consolidated Copper Mines4, which generally discuss the question of costs, the discretion by the court in awarding them and the principle that costs follow the event. We were also urged by Mr. Gondwe, in the event that we agreed with his position that the appellant had substantially succeeded, to apply the provisions of Order rll R. S. C. which R6 applies to clerical mistakes in judgments so as to vary them and make the meaning plain. State Counsel Mukande’s argument on the other hand was that this Court ordered the parties to bear their respective costs. The judgment delivered by this Court did not interfere with the lower court’s order as to costs. He argued that costs only relate to the particular event upon which they are ordered and as such a previous order for costs cannot be varied by a subsequent one. For this argument, he relied on the case of Costa Tembo v Hybrid Farm (Z) Limited5, in which we held that: “The Supreme Court has the power to make such order as to the whole or any part of the costs of appeal or any court below as may be just but in this present case the court’s order as to costs did not affect the costs incurred in the court below, but only affected costs incurred in the appeal. The term we used; to “make no order on costs” should be taken in the full context of the whole paragraph. We are alive to the principle that a successful litigant is entitled to his costs. After noting that in “this appeal”, the respondent had partially succeeded, we made no order on costs. Clearly, this order related to the costs in this Court and not the Court below. It is evident from the wording of the paragraph in R7 question that we did not vary the Order for costs made by the Court below. Our order only affected costs on appeal. ” On the face of it, State Counsel Mukande’s argument in relation to the case of Costa Tembo on costs seems to have considerable force. The broader issue however, which needs to be addressed, is whether a successful party who is not guilty of objectionable conduct should be made to pay costs in the lower court on the ground that even though the party substantially and for all intents and purposes lost on appeal he is still entitled to costs in the court below, simply because no specific order was made in the judgment which had been effectively set aside. Paragraph 717 of Halsbury’s Laws of England, Volume 37 gives the following guidance on costs: “In the exercise of the court’s discretion, a successful plaintiff may be deprived of part or all of his costs, or may be ordered to pay the costs of the defendant or part of them; and a successful defendant may be deprived of part or all of his costs. However, to make a defendant who succeeds in the sense that no relief is ordered against him pay the costs of the plaintiff who fails in the sense that no relief is obtained by him in his suit requires a strong and exceptional case. ” Paragraph 714 of the same volume of Halsbury’s states as R8 follows: “ In general, costs are in the discretion of the court... This discretion must be exercised judicially, it must not be exercised arbitrarily but in accordance with reason and justice, and the judge ought not to exercise it against the successful party except for some reason connected with the case... ” The explanatory notes to paragraph 714 go on to explain that: “The principles of reason and justice clearly demand that a plaintiff who embarks on a piece of fruitless litigation should not be entitled to costs as of right.” Rule 77 of the Supreme Court Rules Cap 25 provides that this Court may make orders as to costs which are just. It reads as follows: “77. The Court may make such order as to the whole or any part of the costs of appeal or in any court below as may be just,...” A perusal of the case of Costa Tembo v Hybrid Poultry Farm (Z) Limited relied upon by State Counsel Mukande shows that in that case the respondent had in fact partially succeeded and this R9 Court ordered that he should be paid his remaining two months’ salary in lieu of notice. In the present case, the respondent has only had a pyrrhic victory on peripheral issues as the judgment in the court below has in effect been set aside. The record does not show that the appellant’s conduct entitled the respondent to costs even though the respondent did not succeed. We are therefore of the view that while the Costa Tembo is still good law it should be distinguished on its facts with this case. There is nothing strong or exceptional about this case to persuade us to award costs to the respondent nor is there any good reason for doing so. There is no obligation on the appellant to pay the respondent costs in the court below. This motion is allowed, with costs to the appellant, to be agreed or taxed in default of agreement. DEPUTY CHIEF JUSTICE SUPREME COURT JUDGE SUPREME COURT JUDGE ALILA, SC