Zapamwamba Investment v Daza (Commercial Cause 12 of 2023) [2023] MWHC 76 (4 September 2023)

IN THE HIGH COURT OF MALAWI COMMERCIAL DIVISION BLANTYRE REGISTRY COMMERCIAL CAUSE No. 12 OF 2023 (Before Honourable Justice Msungama) BETWEEN ZAPAMWAMBA se ALE I rae f2 ah ctirvemeas ussite ogee CLAIMANT AND KENSON FENNER POI Sti eae spaler edge lacks Gs BENTO Coram: E. M. Zidule ; Assistant Registrar M. Njobvu Counsel for the Claimant J. Chiundira Counsel for the Defendant B. Ntonya Court Clerk RULING ON APPLICATION TO SET ASIDE DEFAULT JUDGMENT Background The Claimant is a registered business entity that employed the Defendant in or around 2020. Defendant’s job involved collection and delivery of products to clients within Limbe in Blantyre. However, the Claimant alleges that after about a year and a half, it discovered that the Defendant was not being honest in his sales dealings since he was not submitting all the cash collected. It is the Claimant's further allegation that the Defendant would order a number of cases of the product (the product has not been mentioned in the summons) 1 around March, 2022, ten clients complained that the Claimant advised them to clear their balances as they were trying to order more products. This is because Claimant's records indicated that the said clients did not pay for the products that they previously ordered from the Claimant. Later, the Claimant investigated the matter and noted that the Defendant received Payments but embezzled the same. The Defendant admitted that he collected the money but did not remit to the Claimant. He Promised to pay within two weeks but he failed to do so. The Claimant further states that the Defendant was willing to pay first half of the amount, MK10,934,000.00 within four months from June to September, 2022 and that the remaining amount would be repaid within three months, from October to December, 2022. The year for payment has not been indicated but the Court believes that it is 2022 since the commitment was made in 2022. Further, the Claimant alleges that the Defendant offered his Property in Chilomoni as collateral for the repayment of the money which the Claimant believes was built using the money that the Defendant misappropriated. On 20th January, 2023, the Claimant commenced Proceedings against the Defendant Claiming; ke Payment of the sum of MK21,869, 400.00 being the amount the Defendant owes the Claimant: ii. Accumulated interest: ili. Statutory legal collection charges; iv, Damages for breach of contract and costs of action, On 18" April, 2023 a default judgment was entered in favour of the Claimant pursuant to Defendant's failure to file a defence within 28 days from the date of being served with the Summons, namely, 3"¢ February, 2023. As the matter was about to come for hearing on assessment of interest and damages, the Defendant filed an application to set aside default judgment on 18" July, 2023. The application was supported by a sworn statement deponed by the Defendant and skeleton arguments. The Defendant argued in the application that the Claimant did not personally serve him the summons in these proceedings. The Defendant also argued that he has a meritorious defence to the claim The Claimant opposed the application and filed a sworn statement in Opposition deponed by Counsel Mirriam Njobvu. The Claimant argued that the summons was served on the Defendant on 3°4 February, 2023 through his house servant. The Defendant, therefore, neglected or ignored to file a defence nor a response since it is impossible that the Defendant could not get the summons despite the same being served on his servant. The Claimant further submitted that the Claimant admitted the claims on 19th May, 2022 and application should be dismissed with costs. Issues for determination i. Whether or not the Defendant has shown reasonable cause for not defending the action, if. Whether or not the Defendant has a meritorious defence. i. Has the Defendant shown reasonable cause for not defending the claim? Order 12 Rule 21 of the CPR, 2017 provides that an application to set aside default judgment may be made not later than 3 months after the judgment is entered while Order 3 that the Court may order that a document be served by leaving it with an adult person at the last known address of the person to be served. However, the Challenge is that the Court did not make such an order in the matter herein. The Provision cited by the Claimant is, therefore, not applicable in the circumstances. Unfortunately, the Claimant did not State, in the sworn statement in support of its application for a default judgment, whether the Defendant advised them to leave the summons with his house help or not, Unless there was a directive from the Defendant that the summons be served on Mr. Levison Biton, on his behalf, which Seems not to be the case since the Claimant did not state the same, there was no personal service of the summons on the Defendant as stipulated by the Rules. The Court is mindful that there are two things involved here, either the Defendant was given the summons by Mr. Levison Biton or he was not. We cannot speculate. But what is clear is that the summons was not personally served on the Defendant hence his failure to defend the claim. il, Whether or not the Claimant has a meritorious defence Order 12 r 21 (3) of the CPR, 2017 provides that the court may set aside the judgment in default if it is satisfied that the defendant- (a) has shown reasonable cause for not defending the application; and (b) has a meritorious defence, either about his liability for the application or about the amount of the application. However, having found that the summons was not personally served on the Defendant, the court will not consider the other requirement for setting aside default judgment. It does not matter that the Defendant made a commitment to settle the sum that is being claimed within 6 months since the same was made before the matter was commenced. What matters is that the Claimant failed to serve the summons personally on the Defendant when the matter was filed with the Court. In the case of Kondwani Kamanga v. Snowden Magonjetsa and 3 Others Land Cause Number 18 of 2018 the Court set aside a default judgment that was entered against the 4'" Defendant since it was not personally served with the summons, the same having been served on the Chief of the area where the land in dispute was located. Conclusion wOnciusion days from the date hereof. Costs shall be in the cause. Delivered in Chambers this 4 day of September, 2023 at High Court, Commercial Division, Blantyre Registry. F MM idle E. M. Zidule Assistant Registrar