Choma Municipal v Lamsden Zulu and Anor (Appeal No. 263 of 2024) (6 June 2025) – ZambiaLII

IN THE COURT OF APPEAL OF ZAMBIA Appeal No. 263 of 2024 HOLDEN AT LUSAKA (Civil Jurisdiction) r, • • BETWEEN: CHOMA MUNICIPAL COUNCIL APPELLANT AND LAMSDEN ZULU 15 RESPONDENT T GETRUDE MOONO ZULU 2ND RESPONDENT CORAM: SIAVWAPA JP, CHISHIMBA & PATEL, JJA On 22 nd April & 6 th June 2025 For the Appellant: Ms. M. Lwenje In House Counsel For the Respondent: Mr. A. Bwalya & Mr. E. Luhanga Messrs. KBF & Partners JUDGMENT Patel, JA, delivered the Judgment of the Court. Cases referred to: 1. Ody's Oil Company Limited v The Attorney General (2012} 1 ZR 164 Legislation & Rules referred to: 1. The Arbitration Act, No.19 of 2000 of the Laws of Zambia 2. The High Court Rules, Chapter 27 of the Laws of Zambia 3. The Court of Appeal Act No. 7 of 2016 Works referred to: 1. Halsbury's Laws of England, 4th Edition, Volume 10 1.0 INTRODUCTION 1.1 This is an appeal against the Ruling of Wina J, delivered on the 7th May, 2024, in respect of an application for special leave to review, brought by the Appellant against a ruling delivered on the 10th day of October, 2023. 1.2 The Hon. Judge, in the lower Court, dismissed the application, which is now the subject of the appeal before us. 1.3 It is worth mentioning at this stage that, in the Court below, two separate actions were commenced by the ist and 2nd Respondents under Cause Numbers 2023/HL/34 and 2023/HL/33, respectively. Upon appeal to this Court, the matters were assigned as Cause Numbers CAZ/8/235/2024 and CAZ/8/234/2024, respectively. These matters were subsequently consolidated by this Court on the 5th day of July 2024. J2 1.4 This appeal presents two issues for our determination. Primarily, we will look at Order 39 of the Rules of the High Court2 and consider the question to whom an application for special leave to review shall lie. Secondly, we will consider in what limited circumstances we may interfere with the exercise of discretion of the lower Court on an award of costs in the specific context of an application made under section 10 of the Arbitration Act1 (Referred to as . the section 10 application). 2.0 BACKGROUND 2.1 For the purposes of this section, the parties shall be referred to as they appear in this Court. 2.2 The Appellant (Plaintiff in the Court below) commenced an action on 17th May 2023 by way of Writ of Summons and Statement of Claim seeking the following reliefs: i. An order that the Defendant pays the outstanding arrears of house rentals amounting to the sum of ZMW129,464.20; ii. An Order for vacant possession of Stand Number CHO/0085A, Mochipapa, Choma; iii. Interest; iv. Damages for breach of agreement; v. Any other relief the Court may deem fit vi. Costs J3 2.3 On 6th June 2023, both the 1st Respondent and 2nd Respondent (Defendants in the Court below) filed an application to stay the proceedings and refer the matter to arbitration pursuant to Section 10 of the Arbitration Act1 . The application was premised on the basis that the matter was improperly before the lower Court as the parties had not exhausted arbitration proceedings which the Respondents argued the parties were bound by virtue of the tenancy agreement dated 1st January 2020. 2.4 The Respondents argued that the arbitral clause was operative even when the tenancy agreement has expired or has been terminated. It was on this premise that the Respondents argued that the matter must be stayed. 2.5 In two separate Rulings, both delivered on the 10th day of October 2023, one in respect of the 1st Respondent and the other in respect of the 2nd Respondent, Justice Sinyangwe, who was then seized with the matter, held that the Court's jurisdiction is ousted where the parties have agreed to refer a matter to arbitration for settlement of any disputes arising therefrom. He subsequently stayed proceedings and referred both matters to arbitration and ordered costs for the Respondent(s) respectively. 2.6 Thereafter, the record reflects that the matter was re-allocated to Lady Justice Wina, following the transfer of Justice Sinyangwe from the Livingstone High Court. 2.7 On 2nd February 2024, the Appellant filed an application for special leave to review the aforementioned Ruling of 10th October 2023 out of time, pursuant to Order 39 Rule 2 of the High Court Rules2 • J4 2.8 On 7th May 2024, the learned Judge (Wina) dismissed the Appellant's application for special leave to review out oftime. The Rulings are noted from pages 12 to 20 and 21 to 29 respectively. 3.0 DECISION OF THE LOWER COURT 3.1 The learned Judge considered the arguments put forth by both parties. She noted that, the Appellant despite having a tenancy agreement, which contained an arbitration clause, went ahead and commenced an action in the High Court. 3.2 The learned Judge (Wina) noted that the Appellant's main argument in its application hinged on the learned Judge's (Sinyangwe's) Order for costs in his Ruling of 10th October 2023. The learned Judge (Wina) disagreed with the Appellants arguments that it was only when matters are concluded that costs can be awarded. It was her view, that to suggest that merely because a matter did not reach its conclusion, a party cannot be awarded costs is a proposition that is wrong at law. 3.3 The learned Judge (Wina) held the view that the award of costs is purely at the discretion of the Court and to suggest that the award of costs in the case was not exercised judicially, was simply incorrect. 3.4 Upon hearing the application on 15th February 2024, the learned Judge in the lower Court delivered her Rulings on 7th May 2024 wherein she dismissed the· application on the basis that she lacked the power to review a Ruling made by another Court which it was at par with and granted the Appellant leave to appeal. JS 4.0 THE APPEAL 4.1 Dissatisfied with the outcome in the lower Court, the Appellant filed its Notice and Memorandum of Appeal, on 20th May 2024, fronting three (3) grounds of appeal, namely: i. The trial Court misdirected herself on the point of law when she went ahead and determined the application for special leave to review when she had no jurisdiction over the matter and should instead have referred the application to the substantive judge. ii. The trial Court misdirected herself on the point of law by dismissing the application as lacking merit when she did not have jurisdiction to hear the application. iii. The trial Court fell in error on the point of law when she held that the discretion to condemn the appellant to pay costs was judiciously exercised and yet the matter was not determined but the proceeding was merely stayed and the matter referred to arbitration for determination. 5.0 APPELLANT'S HEADS OF ARGUMENT 5.1 We have duly considered and appreciated the Appellant's Heads of Argument filed on 20th September 2024. 5.2 With respect to ground 1 and 2 of the appeal, the gist of the Appellant's argument hinges on the submission that the learned Judge of the lower Court should have ensured that she had the necessary jurisdiction before hearing the matter. It was argued that the learned Judge subjected the parties to unfair procedure by calling the parties to appear before Court and then J6 ultimately dismissing the application on the basis that she did not have jurisdiction. 5.3 In relation to ground 3, the Appellant submitted that reference to arbitration is not a determination of the matter on the merits for any party to be condemned to pay costs. It is the submission that the Appellant in this matter has been unjustly condemned to costs without the Court taking into consideration that the matter was not dismissed but stayed. It was the Appellant's prayer that this appeal be upheld and that the costs order of 2nd February 2024 and 7th May 2024 be set aside. 6.0 RESPONDENT'S HEADS OF ARGUMENT 6.1 We have duly considered and appreciated the Respondent's Heads of Argument filed on 14th October 2024. 6.2 In responding to grounds 1 and 2, it is the Respondent's submission that the Appellant's filing of the application for special leave to review on 2nd February 2023 was an attempt to try and re-open the matter whose proceedings had ended at the point of referral to arbitration. 6.3 The Respondent referred to Section 23 (1) of the High Court Act 2 which states as follows: "Any cause or matter, at any time or at any stage thereof, and either with or without the application of any of the parties thereto, be transferred from one Judge to another Judge by order of the Judge before whom the cause or matter has come or been set down: J7 Provided that no such transfer shall be made without the consent of the Judge to whom it is proposed to transfer such cause or matter. 11 6.4 The Respondent was of the considered view that the lower Court, whether by the learned Judge (Sinyangwe) that earlier had conduct of the matter or the learned Judge (Wina), had no jurisdiction to hear and determine an application on a matter whose proceedings had been terminated. 6.5 It was the Respondent's contention that the Appellant being dissatisfied with the Ruling of the lower Court (Sinyangwe), dated 10th October 2023, ought to have appealed against the said Ruling instead of making an application for special leave to review the Ruling, before a Court that was already ousted of jurisdiction from the moment the Court stayed the proceedings and referred the matter to arbitration. 6.6 In response to the third ground of appeal, the Respondent cited a plethora of cases that emphasize the Courts discretion on an award of costs. It is the Respondent's contention that the Respondent is entitled to recover costs from the Appellant on the basis of their successful application to stay proceedings and refer the matter to arbitration. 7.0 APPELLANT'S HEADS OF ARGUMENT IN REPLY 7.1 We have duly considered and appreciated the Appellant's Heads of Argument in Reply filed on 4th November 2024. 7.2 The gist of the Appellant's argument in reply is that where proceedings have been stayed, there is no determination of the matter on the merits for there to be a successful party entitled to an award of costs. On this basis, the J8 appellant prayed that the appeal be upheld and the order of costs of 10th October 2023 be set aside. 8.0 THE HEARING 8.1 At the hearing Counsel Lwenje placed full reliance on the Record of Appeal and its Heads of Argument before the Court. 8.2 The Respondent, while placing reliance on its heads of argument, submitted that the Appellant had invoked a wrong procedure and ought to have simply appealed the Order of costs. With respect to ground 3 of the appeal, Counsel was of the considered view that the Judge in the lower Court was on firm ground when it made an order for costs. 9.0 ANALYSIS AND DECISION OF THIS COURT 9.1 We have carefully considered the arguments and submissions of both parties as well as the impugned Ruling of the lower Court. Although the Appellant has fronted three grounds of appeal, we are of the considered view that the appeal presents one main issue for determination, namely, who should hear an application for special leave to review. 9.2 In addressing grounds 1 and 2 of the appeal, the Appellant has argued that its application for special leave to review was made before the Livingstone High Court on 2nd February 2024 and was expected that the application would be heard and determined by the learned Judge (Sinyangwe) who had delivered the ruling of 10th October 2023. It was submitted that the record was then reallocated to the learned Judge (Wina) for administrative purposes. The Appellant argued that instead of her Ladyship referring the application to the J9 learned Judge (Sinyangwe), she took it upon herself to hear the matter by setting down a date of hearing and calling the parties before Court and asking the parties to make submissions for determination which submissions were filed on 2nd February 2024. 9.3 It was the Appellant's submission that the lower Court subjected the parties to an unfair procedure after having heard the parties, calling for submissions, reserving a ruling but ultimately dismissing an application on the basis she did not have jurisdiction. The Appellant referred to Halsbury's Laws of England, 4 th Edition, Volume 10 at paragraph 717 1 where it states that: "Where a Court takes it upon itself to exercise a jurisdiction which it does not possess, its decision amounts to nothing. Jurisdiction must be acquired before judgment is given." 9.4 The Appellant repeated the same argument with respect to ground 2 of the appeal and added that since the Court had no jurisdiction, it could not pronounce itself on the merits of the case. 9.5 We have had occasion to peruse the record and arguments of the parties. We have noted the application for special leave to review out of time at pages 187 to 188. Order 39 Rules 1 and 2 of the High Court Rules2 provides as follows: 11{1} Any Judge may, upon such grounds as he shall consider sufficient, review any judgment or decision given by him (except where either party shall have obtained leave to appeal, and such appeal is not withdrawn}, and, upon such review, it shall be lawful for him to open and rehear the case wholly or in part, and to take fresh evidence, and to reverse, vary or confirm his previous Judgment or decision; JlO Provided that where the judge who was seized of the matter has since died or ceased to have jurisdiction for any reason, another judge may review the matter. (emphasis added). (2) Any application for review of any judgment or decision must be made not later than fourteen days after such judgment or decision. After the expiration of fourteen days, an application for review shall not be admitted, except by special leave of the Judge on such terms as seem just. 11 9.6 Under these rules, the High Court has jurisdiction to rehear the case wholly, or in part and to take fresh evidence, and to reverse, vary or confirm its previous judgment or decision. 9.7 On a careful reading of the Order above, it is trite that the power to hear an application for special leave to review rests with the Judge that heard the initial application in the first place. It is clear that in casu, the lower Court {Sinyangwe) had not lost jurisdiction on account of relocation alone. He was still a Judge of the High Court and was thus the Court that was supposed to hear the application and thereafter determine whether it met the required threshold for leave to be granted or not. 9.8 We are of the considered view that based on the above, the lower Court (Wina) should not have proceeded to hear, determine and dismiss the Appellant's application. Any and all pronouncements made by the lower Court {Wina}, to the fact that the Appellant had not satisfied the conditions precedent for the grant of leave and or any subsequent pronouncements that the Court made thereafter, are set aside as the lower Court simply had no jurisdiction to hear the special application for leave to review. Jll 9.9 By our determination above, grounds 1 & 2 have merit and are upheld. 9.10 With respect to ground 3 and the argument on costs, we are entitled to refer the Appellant's application for special leave to review to be heard by the lower Court (Sinyangwe) for determination. We have also not glossed over the fact that the lower Court (Sinyangwe) had granted leave to appeal. It is clear that the application for special leave to review before the same Court was misconceived in the circumstances. 9.11 However, we ask ourselves what the benefit would be, if any, for us to simply remit this application back to the lower Court (Sinyangwe) when the Parties are already on appeal before us. In the interest of justice and in accordance with the provisions of section 24 of the Court of Appeal Act,3 we are of the settled view that the justice of the matter will be best served if we determine the matter at this stage. 9.12 It is fundamental and almost basic that at the point of making a section 101 application, the Court is not called upon to determine any matter on the merits save to make a determination on the applicability of the arbitration agreement. The Appellant has placed reliance on the decision of the Supreme Court in the case of Ody's Oil Company Limited v The Attorney General (2012} 1 ZR 164 in support of that principle. It is also argued that the Party applying under section 10 ought not to be condemned in costs. 9.13 We must also point out that the Respondent in its argument at paragraph 6.4 above, appears to harbor the understanding, mistakenly so, that by its determination by the lower Court, proceedings had been terminated. This is not the position, a section 10 application, once granted, simply stays J12 proceedings until the arbitration is concluded whereafter the Parties may revert to the Court under section 17 of the Arbitration Act or as appropriate. 9.14 We are alive to the basic principle that in the award of costs, the normal rule is that costs follow the event. We also accept that the award of costs lies in the discretion of the Court, and that the discretion must be exercised judiciously with reason and on sound principles. We however pause to ask ourselves: was there a successful party in the section 10 application? We have noted the arguments of the Respondent supporting the award of costs and cannot help but agree with the Appellant that all case law referred to by the Respondents refer to matter concluded on the merits followed by the Court pronouncing itself on the issue of costs. 9.15 To the extent that the lower Court (Sinyangwe) stayed proceedings and referred the Parties to arbitration, we are of the considered view that he misdirected himself in awarding costs, as that is akin to penalising the Party for making a section 10 application. We set aside the Order of costs made by the lower Court. Ground 3 has merit and is upheld. 9.16 Having therefore found merit in the appeal, we uphold the appeal. On the issue of costs and in the interest of justice, we order that Parties bear their own costs here and in the lower Court. ' M.J. SIAVWAPA JUDGE PRESIDENT F. M CHISHIMBA A.N. PATEL S.C. COURT OF APPEAL JUDGE COURT OF APPEAL JUDGE J13