Sydney Choonga v Yona Daka (APPEAL NO. 209 OF 2024) (11 June 2025) – ZambiaLII

I --- ............ ' IN THE COURT OF APPEAL OF ZAMBIA APPEAL NO. 209 OF 2024 HOLDEN AT LUSAKA (CIVIL JURISDICTION) BETWEEN APPELLANT SYDNEY CHOONGA AND 1 RESPONDENT YONADAKA ST RESPONDENT MULEZA MWIIMBU AND COMPANY 2ND (Sued as a firm) CORAM: Chashi, Makungu and Banda-Bobo, JJA ON: 23rd April and 11th June 2025 For the Appellant: I. Musumali (Ms), Mesdames Glory Mushiya and Associates For the 1st Respondent: N/ A For the Respondent: H.B Hantumbu, Messrs Muleza Mwiimbu 2nd and Company JUDGMENT CHASHI JA, delivered the Judgment of the Court. Cases referred to: 1. Anglers Haven Ltd v Yexley Limited, Patrick Andrew Lawton and Sharpe and Howard Legal practitioners (Sued as a.firm)- 2015/HPC/0143 -J22· Willam David Carlisle David Wise v. E.F. Hervey Ltd (1985) ZR, 179 - Masauso Zulu vAvondale Housing Project (1982) ZR, 172 4. YB & F Transport Ltd v Supersonic Motors Ltd (2000) ZR, 5. Southern Water & Sewerage Co. Ltd v. Sanford Mweene - SCZ/8/307/2006 6. Road Development Agency v. Agro Fuel Investments Ltd - (CAZ Appeal No. 114 of 2019) 7. Kuta Chambers v. Concilia Sibulo - SCZ Selected Judgment No. 36 of 2015 8. Abenas United Ltd v J.C. Mulunga & Company - CAZ Appeal No. 1 SO of 2017 9. Collett v Van Zyl Brothers Ltd (1966) ZR, 65 10. Brian Asin & 2 Others v Wafula W. Chebukati & 9 Others (2017) eKLR 11. Godfrey Miyanda v Attorney General (2009) ZR, 76 12.Mpande Nchimunya v Steven Hibwani Michela (19951997) ZR, 230 13. Manharial Harji Patel v Surma Stationers Ltd (2009) ZR, 14.Anderson Mazoka v Levy Mwanawasa (2005) ZR, 38 15. Christopher Lubasi Mundia v Sentor Motors (1982) ZR, 16.Attorney General v Marcus Kampumba Achiume (1983) ZR, 1 -J3- ~ules referred to: · Law Association of Zambia (LAZ) General Conditions of Sale, 2018 2. The Legal Practitioners' Practice Rules, 2002, Statutory Instrument No. 51 of 2002 3. The High Court Rules, Chapter 27 of the Laws of Zambia 4. The Supreme Court Practice (White Book) 1999 Others works referred to: 1. J.C. W. Wylie, Irish Conveyancing Law, 1999, 2nd Edition (Butterworths, Ire land) 2. Atkins Court Forms Vol. 13 (LexisNexis, 2013) 3. Charlesworths & Percy on Negligence, 12th Edition (Sweet & Maxwell, London) 1.0 INTRODUCTION 1.1 This is an appeal against the ex-tempore Ruling of Hon. Ms Justice S. Chocho delivered on 18th March 2024. 1.2 In the Ruling, the learned Judge granted the 2nd Respondent's application for misjoinder and accordingly removed them from the proceedings. She further awarded costs to the 2nd Respondent. -J42 -0 BACKGROUND 2. 1 The brief background to this appeal is that the Appellant, as plaintiff in the court below, commenced an action on 27th September 2023, against the 1st and 2nd Respondents, seeking inter alia a refund of Kl 15,000.00, being the purchase price of Lot Lus / 33463 Lusaka and damages for the breach of contract and loss of opportunity to purchase the property. 2.2 According to the statement of claim, in December 2022, the Appellant entered into a contract with the 1st Respondent to purchase Lot Lus/33463 Lilayi Lusaka (the property) for K130,000.00. The Appellant paid a deposit of Kl 15,000.00, through the 2nd Respondent which was acting as the 1st Respondent's advocates. The property was at offer letter stage and the Appellant was assured that a certificate of title would be processed upon payment. 2.3 It was averred that despite payment, the 1st Respondent failed to secure the certificate of title and subsequently became elusive. In May 2023, the Appellant discovered -JSthat another person had taken possession of the property, claiming ownership. The Appellant reported the issue to the 1st Respondent and made several follow ups without any resolution. On 14th July 2023, the 1st Respondent, through the 2nd Respondent, undertook to refund the purchase price but failed to do so. As a result of this breach, the Appellant claimed to have suffered loss and damage, leading to the commencement of this action. 2.4 In its defence, the 2nd Respondent refuted the claims made by the Appellant but acknowledged the receipt of the payment amounting to Kl 15,000.00, towards the nd purchase price. The 2 Respondent asserted that the letter dated 14th July 2023, merely conveyed instructions from the 1st Respondent and did not constitute a commitment to refund the Appellant. Furthermore, it contended that it was not a party to the con tract and that no f · cause o action was disclosed against it. 2.5 Subsequently, on 5th February 2024, the 2nd Respondent applied to dismiss the action against it for -J6abuse of court process and for failure to disclose a cause of action. The Appellant opposed the application, arguing that the 2nd Respondent, having received the purchase money on behalf of the 1st Respondent, was a necessary party to the proceedings. The Appellant contended that the Respondent, though not his 2nd advocates, were stakeholders who held the funds in trust on his behalf and should the refo re have conducted due diligence before accepting payment and acting on behalf of the 1st Respondent. 3.0 EX TEMPORE RULING OF THE COURT BELOW 3.1 Upon considering the affidavit evidence and the submissions by both Counsel for the Appellant and the Respondent, the learned Judge in her ex-tempore 2nd Ruling, distinguished the present case from Anglers Haven Ltd v Yexley Limited, Patrick Andrew Lawton and Sharpe and Howard Legal practitioners (Sued as a firm)1 which involved similar facts. She found that the Appellant, in the present case, had not demonstrated that the Respondent was in possession of the funds 2nd paid by the purchaser. -J73.2 The learned Judge also held that the Appellant's writ of summons and accompanying statement of claim did not disclose a cause of action against the 2nd Respondent. She noted that it was the 1st Respondent who had undertaken to refund the Appellant. Accordingly, the Judge granted the Respondent's application, 2nd removed them from the proceedings and awarded them costs. 4.0 THE APPEAL 4.1 Dissatisfied with the decision of the court below, the Appellant has appealed to this Court, advancing two grounds as follows: 1. The lower court misdirected itself both in law and fact when it failed to judiciously apply the principles relating to awarding of legal costs when it upheld the 2nd Respondent's application for a mis-joinder with costs to be borne by the Appellant despite the facts surrounding the case which bordered on the refund for a failed purchase of a property. -JS2. The lower court misdirected itself both in law and fact when it misjoined the 2nd Respondent on the grounds that there was no cause of action, notwithstanding the provisions of the Law Association of Zambia General Conditions of Sale 2018 and the law governing the duties of Advocates in conveyancing transactions. 5.0 ARGUMENTS IN SUPPORT OF THE APPEAL 5.1 Ms Musumali, Counsel for the Appellant, relied on the filed heads of argument dated 7th August 2024, which she augmented with brief oral submissions. Counsel began by addressing ground two. In support of this ground, Counsel submitted that the statement of claim clearly outlined the basis for joining the 2nd Respondent to the proceedings. It indicated that the dispute arose from a failed land transaction between the Appellant and the 1st Respondent. According to Counsel, the Appellant paid the purchase price directly to the 2nd Respondent in their capacity as advocates for the 1st Respondent, a fact that was not disputed. Therefore, by having received the purchase price and acting as -J9advocates in the transaction, the 2nd Respondent was properly joined to the action. 5.2 According to Counsel, the land transaction was governed by the Law Association of Zambia (LAZ) General Conditions of Sale, 20181 The Contract of . Sale, made pursuant to these conditions, explicitly identified the Respondent as the vendor's advocate. 2nd Under General Condition 7, the vendor's Advocate was required to hold the purchase money in trust for the purchaser and to refund it if the purchaser did not confirm receipt of vacant possession. It was argued that, these duties were clear and undisputed, establishing a legal obligation on the part of the 2nd Respondent. 5.3 It was contended that the 2nd Respondent's affidavit in support of their application for misjoinder appearing at pages 75-83 of the record of appeal (the record), confirmed that the funds in question were received on behalf of the 1st Respondent. That despite several demands made to the 2nd Respondent for a refund of the said amount, all efforts proved unsuccessful. This, it was submitted, established a sufficient factual -JlOfoundation for a cause of action. We were referred to the case of William David Carlisle Wise v E.F. Hervey Ltd2 where it was held that a cause of action exists ' where facts are alleged that give rise to legal liability. 5.4 It was submitted that striking out the matter against the 2 Respondent on the ground of an alleged absence of nd a proper cause of action amounted to a denial of justice. Counsel argued that any perceived deficiencies in the pleadings could have been appropriately addressed through a request for further and better particulars. Counsel relied on the case of Masauso Zulu v Avondale Housing Project3 where the Supreme Court held that , courts should adjudicate on all issues in a suit to bring finality and avoid piecemeal litigation. It was contended that the decision to strike out the matter undermined this principle and effectively denied the Appellant access to justice. 5.5 Counsel further referred us to the Anglers Haven Ltd case, where the court held that where a law firm holds funds for a transaction that fails, it may be liable to return those funds. Counsel argued that the Appellant -Jlltherefore had a valid and reasonable cause of action and it would have proved impossible to prosecute the matter without joining a party who received the money and failed to refund as provided by the law. 5.6 Addressing the Respondent's argument that the 2nd I Appellant was not their client, Counsel submitted that this argument was immaterial. By receiving and holding the purchase money, the 2nd Respondent assumed fiduciary duties as a stakeholder. We were referred to J.C. Wylie in Irish Conveyancing Law (2nd Ed.J,1 which affirms that a stakeholder is obliged to hold funds for the benefit of both parties to a transaction and to return such funds if the transaction fails. Counsel noted, that this principle is echoed in General Condition 3 of the LAZ Conditions of Sale. Accordingly, the 2nd Respondent owed a duty to refund the Appellant upon the collapse of the transaction. It was argued that, in granting the 2nd Respondent's application, the lower court departed from the established legal principles. 5. 7 In addition, Counsel maintained that under the Legal Practitioners' Practice Rules, 2 advocates must act -i -Jl2with integrity and in a manner that promotes public confidence. That the 2nd Respondent's failure to ensure that the property was lawfully owned by the vendor or the failure to conduct due diligence before accepting the money, and their subsequent refusal to return the funds, violated this duty. Based on the foregoing, it was submitted that the 2nd Respondent was properly joined to the proceedings and were a proper party against whom relief may be sought. 5.8 In support of ground one, It was submitted that the lower court misdirected itself when it awarded costs to the 2nd Respondent upon granting their application for misjoinder. Counsel argued that the court failed to judiciously apply established principles on costs, especially in light of the 2nd Respondent's role 1n rece1v1ng the purchase pnce on behalf of the 1st Respondent and failing to ensure that the property in question was validly owned. 5. 9 Counsel emphasized that the Appellant's claim arose from a failed transaction in which the 2nd Respondent, as advocates, received funds but failed to return them -J13after the transaction collapsed. Despite this, the lower court ordered the Appellant to pay costs, which was unjust and prejudicial. 5.10 It was argued that while it is accepted that awarding costs is at the discretion of the court, such discretion must be exercised judiciously. Counsel relied on the r cases of YB & F Transport Ltd v Supersonic Motors Ltd4 and Southern Water & Sewerage Co. Ltd v Sanford Mweene5 where the courts emphasized that , costs should follow the event unless there are good reasons to depart. That the principle is that a successful party is normally entitled to costs unless their conduct contributed to the litigation. 5. 11 It was further con tended that this was a proper case in which the Appellant should not have been condemned to costs following the misjoinder application, as such an order was unjust in the circumstances. The 2nd Respondent's demand for KlS0,000.00, highlighted the unfair burden placed on the Appellant, who now stands to suffer double loss at the hands of the Respondents. Counsel further argued that even if the court was of the -J14view that no proper cause of action existed, it would have been in the interest of justice to withhold a costs order, particularly given the existence of a clear prima facie case against the 1st Respondent. 5.12 Counsel also relied on Road Development Agency v Agro Fuel Investments Ltd6 and Kuta Chambers v Conciliar Sibulo7 which confirm that courts may , depart from the general rule on costs where a party's conduct caused or unnecessarily prolonged litigation. It was submitted that, in this case, special circumstances existed which should have disentitled the 2nd Respondent from receiving any costs or payment from the Appellant. 5.13 It was further submitted that the misjoinder application did not extinguish the cause of action and the lower court could have directed an amendment or clarification of the pleadings rather than striking out the claim and awarding costs. In conclusion, it was argued that there were clear and reasonable grounds for pursuing the 2nd Respondent. We were urged to uphold this ground of appeal and set aside the cost order, with costs. -JlSS. l4 At hearing of this appeal, Counsel referred the Court to the case of Abenas United Ltd v J.C. Mulunga & Company.8 6.0 ARGUMENTS OPPOSING THE APPEAL 6.1 Mr. Hantumbu, Counsel for the 2nd Respondent, relied on the heads of argument dated 5th September 2024. In response to ground one, it was submitted that the Court below exercised its discretion judicially and in accordance with established legal principles when it awarded costs to the 2nd Respondent upon allowing the application for misjoinder. 6.2 It was argued that the award of costs is governed by Order 40 Rule 6 of The High Court Rules3 which vests , the Court with full discretion to award and apportion costs in any manner it deems just. In support of this position, reference was made to Atkins Court Forms Vol. 132 which defines costs as "fees, charges, , disbursements, expenses and remuneration incurred by a party in or incidental to the conduct of proceedings." Counsel argued that the rationale for the award of costs is to indemnify the successful party for expenses -Jl6reaso bl · na Y incurred due to \Jt he action and to penalize the unsuccessful party for putting the successful party to unnecessary expense. 6 •3 Further guidance was drawn from Collett v Van Zyl Brothers Ltd9 where the court emphasized that the , discretion to award costs must be exercised judicially. According to Counsel, this principle was further elaborated in the Kenyan case of Brian Asin & 2 Others v Wafula W. Chebukati & 9 Others10 where the court , held that a successful party should ordinarily not be denied costs unless there are good reasons. That this principle was further reinforced by the Supreme Court in the YB and F Transport case where it stated that costs should follow the event unless the successful party is shown to have acted improperly. 6.4 It was argued that, in this matter, the 2nd Respondent, as the legal representative of the 1st Respondent, incurred costs defending itself against a claim in which it had no legal stake. The Appellant's pleadings did not disclose any cause of action against the 2nd Respondent. -Jl 76.5 Counsel further submitted that the Appellant had viable legal alternatives that could have resolved the matter without implicating the 2nd Respondent, such as applying for judgn1ent in default of appearance against the 1 Respondent or seeking entry of judgment on sl admission based on the 1st Respondent's letter of admission appearing at page 46 of the record. That the decision to pursue the 2nd Respondent, despite the lack of legal foundation, justified the award of costs. Consequently, it was argued that this ground of appeal lacks merit and should be dismissed. 6.6 In addressing the second ground, it was submitted that the procedure for striking out proceedings on the grounds of abuse of court process or lack of cause of action is provided under Order 18 Rule 19 of the Rules of the Supreme Court4 (RSC). This rule empowers the Court to strike out pleadings that are frivolous, vexatious or disclose no reasonable cause of action. 6. 7 Counsel refe rred to the case of Godfrey Miyanda v Attorney General 11 where the Supreme Court applied , Order 18 / 19 RSC4 and held that where an action fails -JlS to disclose a caus f . e o action, the Court may dismiss the matter summarily. According to Counsel, the threshold for invoking this provision was met in the present case, as the statement of claim contained no factual averments that could sustain liability against the 2nd Respondent. 6.8 Counsel further referred to the case of Mpande Nchimunya v Steven Hibwani Michelo12 where the , Court affirmed that a claim that discloses no cause of action entitles the plaintiff to no remedy and that there can be no waiver in such a case as there is simply nothing to try or prove. 6. 9 Moreover, Counsel relied on the decisions in William David Carlisle v EF Hervey Ltd 13 and Manharial Harji Patel v Surma Stationers Ltd14 where the Supreme , Court defined a cause of action as a factual situation that entitles a party to relief against another. In the instant case, it was argued that the Appellant's pleadings failed to allege any actionable conduct by the Respondent. It was argued that paragraphs 4 to 10 2nd of the statement of claim clearly established that the -Jl9cont ract of sale . was strictly between the Appellant and the Resp o d . 1st n ent, with no reference to any act or omission by the R d 211c1 cspon ent that could constitute a breach. 6.10 Counsel further submitted that, as held in Anderson Mazoka v Levy Mwanawasa15 parties are bound by , their pleadings, and the Court can only adjudicate on matters expressly pleaded. That this principle was further reaffirmed in Christopher Lubasi Mundia v Sentor Motors16 where the Court held that where , evidence contradicts "unamended pleadings", the claim fails. According to Counsel, the Appellant failed to plead any particulars of negligence or breach of duty by the Respondent. 2nd 6.11 It was contended that the arguments made both in the court below and in this Court reveal that the evidence adduced is inconsistent with the averments in the pleadings. The court below correctly limited itself to examining the pleadings and determine whether they did disclose a cause of action against the 2nd Respondent. Additionally, the submission that the -J20lower court ought t h 0 ave considered the LAZ General s Conditions of I d a e an the duty of Advocates in the conveyancing matter was misplaced and should be disn1issed. 6 · 12 Counsel also referenced Charlesworth & Percy on Negligence3 which emphasises that contributory , negligence or breach must be specifically pleaded; as failing to do so is fatal to a claim. Therefore, the reliance on unpleaded legal duties could not cure the fatal defect in the Appellant's claim. It was argued that the 2nd Respondent, having been wrongly sued without any legal basis, was rightly misjoined from the proceedings. Consequently, we were urged to dismiss the appeal in its entirety with costs to the 2nd Respondent. 6.13 At the hearing, Counsel submitted that the primary issue before the lower court was whether the pleadings disclosed any liability against the 2nd Respondent. He argued that the Appellant's submissions failed to directly address this central issue. -J211.0 ANALYSIS AND DEC ISION OF THE COURT 7. 1 We have car f 11 . e u y considered the evidence on record, the submissions by Counsel ~or 11 the parties and the Judgment appealed against. The issues falling for determination in this appeal are: 1. Whether the learned Judge erred in holding that no cause of action was disclosed against the 2nd Respondent. 2. Whether the learned Judge erred in awarding costs to the 2nd Respondent despite the surrounding circumstances of the transaction. 7.2 Regarding the first issue, it is not in dispute that the Appellant paid Kl 15,000.00, as part of the purchase price for the property. This payment was made to the 2nd Respondent, who acted as advocates for the 1st Respondent. The transaction failed and the funds were not returned to the 1st Respondent despite multiple demands. 7.3 In its letter dated 14th July 2023, the 2nd Respondent, on behalf of the 1st Respondent, gave an undertaking to nd refund the amount in question. While the 2 -J22Respondent does t d' . no ispute having received the funds ' it contends th t ·t d'd a 1 1 so solely as an agent for the 1st nd Respo ent and therefore owed no independent duty to the Appellant. It further asserts that, not being a party to the sale agreement, it bore no direct legal obligations to the Appellant. 7.4 However, as rightly pointed out by the Appellant, the transaction was governed by the LAZ General Conditions of Sale, which were expressly incorporated in Clause 1 of the Contract of Sale. These General Conditions impose specific responsibilities on a vendor's legal practitioner, especially when that practitioner receives and holds the purchase sum in trust. General Condition 3(b) explicitly states that the deposit is to be paid to the vendor's advocate as stakeholder for the parties, while General Condition 7(i) and (vi) makes it clear that funds must be held in trust and refunded if the purchaser does not receive vacant possession. 7.5 These provisions make it abundantly clear that once the vendor's advocate receives the purchase sum in trust, they are not merely an agent but a stakeholder. We are I -J23of the firm view th t h a t ese conditions are not merely procedural the . . ' Y are protective 1n nature, intended to safeguard the interests of purchasers who may otherwise be vulnerable in conveyancing transactions. They define the Advocate's relationship with both parties and impose a clear obligation on the vendor's advocates to act with integrity and impartiality in handling the deposit. 7.6 We have had the opportunity to look at the Anglers Haven Limited case, which the lower court sought to distinguish from the present case. In that case, the plaintiff had paid a deposit which was received by the vendor's advocates, Sharpe & Howard Legal Practitioners. When the transaction failed, the Plaintiff sued for a refund. The vendor's advocates applied to be struck out for misjoinder, claiming that there was no cause of action against it and that it owed no duty to the plaintiff, maintaining that the deposit was held on behalf of the vendor alone. 7. 7 Mutuna J, as he then was, held as follows: -J24- ". .. although, the parli ar'-' at liberty to vary the general condition or al ti, · / en specLa, conditions, in my 'J ,i on id r d vi w, th aid right do not extend to variation of rn aning of term and phrases used in the g n ral conditions. The phrase "stakeholder" has a rneaning that has legal implications ... a stakeholder holds funds placed in his custody for the benefit of both the parties. Therefore the vendor's advocates as stakeholders, hold the funds for and on behalf of the parties and not just the vendor. As such, in my considered view, either party to a contract can maintain an action against the vendor's advocates . . . . it is clear from the writ of summons issued out herein that the first relief sought is that of the return of the funds paid as deposit in the sum of USD453,809. 74. These funds are held by the Third Defendant and as such any order by this court directing the payment of such funds, in the event of the Plaintiff succeeding, must be directed to the person or entity holding such funds. The order for repayment of the funds cannot in my considered view, be directed at the First Defendant. For this reason, I.find that -J25the Plaintiff does have sufficient cause of action to institute these proceedings against the Third Defendant." . 7.8 This finding by Mutuna J, is consistent with the definition of "stakeholder" under the LAZ General Conditions of Sale1 which reads: , "Stakeholder" means a person or firm holding money on behalf of the parties to a contract and specifically stating that such money is held by such person or firm I as stakeholder." 7.9 While the Anglers Haven case is a High Court decision, we find the ratio decidendi highly persuasive and relevant to the current matter. We accordingly adopt the reasoning therein. The role of a stakeholder is fundamentally different from that of a mere agent. Unlike an agent, who owes duties solely to their principal, a stakeholder especially in the conveyancing context, assumes fiduciary duties to both parties in a transaction and must act impartially. This dual duty cannot be avoided by pleading lack of privity with the purchaser. -J267.10 We have also considered our decision in the Abenas United Ltd case which dealt w1·th . ·1 . I , a s1m1 ar issue. n that case, Abenas United Ltd entered into a contract to purchase land for K250,000.00 and paid a ..: J(::' KlS0,000.00 deposit to the vendor's advocate, J.C. J1 Mulunga & Company. The advocates assured the appellant that the title was genuine and free from encumbrances. However, it later emerged that the vendor was a fraudster with no ownership rights. When the appellant demanded a refund, the advocates refused, stating the funds had been handed over to the vendor. 7.11 The Court held that, as per the LAZ General Conditions of Sale1, the vendor's advocates, having received the deposit as a stakeholder, owed fiduciary duties to both parties to ensure the funds were used only for the intended purpose. Since the transaction failed, the advocates were obligated to return the deposit. As the funds had been paid to a fraudster, the court found them negligent in fulfilling their stakeholder duties. 7.12 In that case, we defined the stakeholder as: -J27- " h a person w o holds the deposit as an agent of both parties, with the authority to pay it to the person who becomes entitled to it under the contract. If the sale goes off by the vendor's fault, the purchaser may recover the deposit from the stakeholder directly. On u the other hand, if the deposit is paid to a person who is merely the vendor's agent, any action to recover it must be brought against the vendor. The vendor can at any time require his agent to pay over the deposit to him". 7.13 The lower court's reasoning appears to overlook this crucial distinction. By treating the 2nd Respondent purely as an agent, the court failed to address the legal consequences of stakeholder status, thereby undermining the protective purpose of the LAZ General Conditions of Sale 1 . 7.14 The lower court's finding that the Appellant had not demonstrated that the 2nd Respondent was still in possession of the funds paid by the purchaser is, in our view, immaterial to the question of whether a cause of action exists. The core issue is not the continued physical possession of the funds, but rather the legal -J28and fiduciary obligations that arose once the 2nd Respondent accepted and held the funds in its capacity as stakeholder. 7. 15 As observed by J.C. Wylie in Irish Conveyancing Law, referred to in the Anglers Haven case, a stakeholder is obligated to hold monies not for one party or the other, but for both, until a specified event occurs which determines to whom the funds should be released. Therefore, even if the Respondent disbursed the 2nd funds to the 1 Respondent, this would not absolve it of st liability, unless it can demonstrate that such disbursement was in accordance with the terms of the contract and the stakeholder responsibilities set out under the LAZ Conditions. 7.16 Based on the foregoing, we are satisfied that the 2nd Respondent was a proper party to the proceedings. By receiving and holding the Appellant's funds in its capacity as stakeholder, the 2nd Respondent assumed fiduciary obligations enforceable by both parties. A breach of those obligations for failure to refund upon the failed transaction gave rise to a valid cause of action. -J29Therefore, contr::in, to Counsel's · assertion that the -J pleadings did not disclose any liability, we find that the pleadings clearly set out the basis of liability by highlighting the 2nd Respondent's role in the transaction. Accordingly, the Respondent was rightly joined to 2nd the action, and the learned Judge erred in striking it out. We find merit in ground two. 7.17 On the second issue, the Appellant challenges the award of costs to the Respondent, arguing that the 2nd circumstances surrounding the transaction did not justify such an order. The general rule is that costs follow the event, and the successful party is ordinarily entitled to costs unless there are special reasons to depart from that position. In this case, the learned Judge found that the 2nd Respondent had been wrongly joined to the proceedings and awarded it costs on that basis. However, as we have already determined, the 2nd Respondent was properly joined. 7.18 In our view, it cannot be said that the Appellant acted unreasonably in commencing proceedings against it, especially given the 2nd Respondent's failure to refund -J30the funds. The litigation b ·came necessary to enforce th Appellant's rights. Accordingly, we find that the I arncd Judge erred in awarding costs to the 2nd Respondent. The order was unjustified in light of the 2nd Respondent's fiduciary role and the circumstances of the case. Accordingly, we set aside the Costs order of the lower court. 7.19 Overall, and as guided by the principles in Attorney • General v Marcus Kampumba Achiume 16 this is an , appropriate case in which we can interfere with the findings of the lower court, as they were perverse and founded on a misapprehension of the facts and law. 8.0 CONCLUSION 8.1 In light of the foregoing, the appeal is meritorious and is accordingly allowed with c ts to the Appellant to be borne by the 2°d · nt. Same to be taxed in default of agreeme SHI COURT OF APPEAL JUDG~ --='tA~N.-,=----=----=~6':::+---- ~ C.K.MAKUNGU A.M.BANDA-BOBO COURT OF APPEAL JUDGE COURT OF APPEAL JUDGE