Eoge Zambia Limited v Star Oil Company (2023/HPC/0598) (20 January 2024) – ZambiaLII

IN THE HIGH COURT FOR ZAMBIA 2023/HPC/0598 AT THE COMMERCIAL REGISTRY HOLDEN AT LUSAKA (Civil Jurisdiction) PLAINTIFF STAR OIL COMPANY DEFENDANT Before the Honourable Mr. Justice L. Mwanabo on 25th January, 2024 V' For the Applicant: Ms C. L. Sinkala of Messrs. May & Co For the Respondent: Ms. J. Ng'andu of Messrs. Kaumbu Mwondela Legal Practitioners RULING Cases referred to: 1. Sunday Kawaya v First Alliance Bank SCZ/8/208 of 1997 2. Southern Cross Motors Limited Vs None System Technology Limited (2012) Z. R. 1. Legislation referred to: 1. Rule of the Supreme Court of England, 1999 Edition 2. High Court Rules Cap 27 of the Laws of Zambia 1.0 INTRODUCTION 1. 1 The Plaintiff in this matter commenced an action against the Defendant claiming ZMW719 573.50 plus interest and judgment on admission was entered on 16th November, 2023 for the sum of ZMW719,573.50 plus interest less any payments made already. The disputed Rl payment of ZMWl00,000.00 was referred to the Registrar for determination in the event of failure by the parties to resolve the issue. 1.2 The Defendant could not pay the judgment sum in full in a lumpsum and applied for an order to stay the Judgment pending determination of the application to liquidate the Judgment sum in monthly instalments. 2.0 APPLICATION 2.1 . The Defendant's application is to liquidate the Judgment sum in monthly instalments. The application was made pursuant to Order 36 Rule 9 of the High Court Rules Cap 27 of the laws of Zambia. 2.2 The application is supported by affidavit, List of Authorities and Skeleton Arguments. The application for stay was granted exparte, therefore, the status of the stay will depend on the outcome of the application on which it is anchored. 3.0 EVIDENCE AND ARGUMENTS IN SUPPORT OF THE APPLICATIONS 3.1 The gist of the Defendant's application to liquidate Judgment in monthly instalment is that, it had paid the Plaintiff ZMW300,000.00 but due to the fact that it is not in active operation it cannot liquidate the debt in one lumpsum. Evidence of the Defendant's cash flow and liabilities was produced using its bank account statement. The Defendant's request 1s to pay ZMWl00,000.00 per month to liquidate the debt. R2 3.2 The Respondent has premised its application on Order 36 Rule 9 of the High Court Rules Cap 27 of the Laws of Zambia and Order 47 Rule 1 of the Rules of the Supreme Court of England, White Book, 1999 Edition which give the Court powers to make an order for payment of a Judgment sum by instalment where there are sufficient grounds to do so and that the application must be supported by an affidavit disclosing income, nature and value of the property owned by the applicant and any other liabilities. Authorities were cited speaking to conditions set out by Order 36 Rule 9 and Order 4 7 Rule 1 among them is the case of Sandy Kawayo and Another v First Alliance Bank Zambia Limited1 and the case of Southern Cross Motors Limited Vs None System Technology Limited2 The considerations to be • made according to these provisions and cases are that: the debt should be paid within a reasonable period, the debtor should make out a good case for instalment which can be considered as sufficient reason or reason and special circumstances to justify the instalment payment. 4.0 ARGUMENTS IN OPPOSITION 4.1 The Plaintiff opposed the application for stay and to pay the Judgment sum in monthly instalments. The Plaintiff's contention is that the Defendant had earlier made several proposals to pay in instalment which the Plaintiff was willing to accommodate but the same were not adhered to by the Defendant. According to the Plaintiff, the Defendant had not adduced sufficient R3 reasons and had also not shown special circumstances or cause to warrant the grant of the said instalment payment as no audited financials and income statement were availed. 4.2 The Plaintiff doubted the Defendant's claim that it is not in operation after looking at the bank statement and stated that it is possible for the Defendant to even have other bank accounts. 4.3 The Plaintiff contends that the Defendant does not deserve to be granted the application sought because it had not lived up to its earlier proposal for payment of the debt. My attention was drawn to Order 9 to fortify the argument with emphasis on the provision that 'where there is a default in paying any one instalment, there should be no order for stay of execution on the balance'. 4.4 The Plaintiff referred me to a number of High Court decisions on the principles that an applicant for payment of judgment debt by way o_f instalment must demonstrate sufficient reasons and special circumstances to render it inexpedient for the judgment creditor to enforce the judgment by execution and the evidence should include audited accounts or statement of accounts to prove its income and expenditure. My attention was again drawn to the case of Sunday Kawaya v First Alliance Bank1 among other cases where it was observed that in some instances a stay can be granted to avoid the harshness of an execution but the same is not granted as a matter of right: the debtor should make out a good case for R4 instalments which can be considered as sufficient reason or special circumstances. 5.0 HEARING OF THE APPLICATIONS 5.1 At the hearing of the matter the parties relied on their respective documents relating to the application. 6.0 ANALYSIS AND DECISION 6.1 I have considered the summons, affidavits and arguments for the respective parties. I have also noted the provisions under which the application by the Defendant is anchored. I have further noted that according to the arguments and submissions by the parties there is no dispute as to whether the Court has jurisdiction to grant an order for payment of judgment by instalments. Both parties have referred me to the same principles for consideration in applications of this nature. The contention is on whether the Defendant's application meets the required conditions to persuade the me to grant the application. 6.2 According to Order 36 Rule 9 of the High Court Rules of the Laws of Zambia and Order 47 of the Rules of the Supreme Court of England 1999 edition (White Book), the case of Sundy Kawayo1 and other cases cited by the parties, the common issues to be considered in addressing an application to liquidate the Judgment by instalment can be outlined as follows: 6.2.1 The applicant should: RS 6.2.1.1 demonstrate that the Judgment debt will be liquidated within a reasonable time; 6.2.1.2 disclose the source of income; 6.2.1.3 other liabilities; 6.2.1.4 disclose the properties owned and the status of the same; and, 6.2. 1.5 provide audited accounts or statement of accounts 6.3 The Defendant has indicated that it is currently not operational but produced a bank statement as its cashflow showing the transactions in the account for the period 26th June, 2023 to 23rd November, 2023 with a negative balance. The Defendant stated that it had other liabilities though not fully disclosed and that it was expecting income from its debtors whose amount was not stated and that it can only manage to pay ZMWl00,000.00 per month. It went further to sate that it had honoured its proposal to pay ZMWl00,000.00 for the month of October and November, 2023 and that payment for December was made but bounced back due to wrong account details provided by the Plaintiff's advocates. The Defendant did not say anything on the assets it owned and did not specify its other liabilities. No audited accounts or statement of accounts were provided. 6. 4 In considering whether the period proposed by the Defendant to pay the judgment in instalment I sreasonable, I am of the view that the period 1s reasonable as it appears that the whole principal amount RG can be paid within a period of about 4 months. The Defendant has by paying the proposed monthly payments for October, November and the bounced payment for December, 2023 demonstrated that it has capacity to meet the proposed monthly payments despite its failure to produce evidence on the some of the requirements. 6.5 In light of the foregoing, I am inclined to exercise my discretion to grant the application and I accordingly order that the Defendant's application to liquidate the balance on the Judgment sum in monthly instalments of ZMWl00,000.00 beginning January, 2024 is hereby granted and the money is to be paid on or before the end of each month. In the event of default by the Defendant to pay any instalment by the due date the whole balance outstanding shall become payable immediately and the Plaintiff will be at liberty to enforce the Judgment accordingly and the proviso to Order 36 Rule 9 of the High Court Rules shall apply. The stay earlier granted shall remain in force as long as the Defendant remains compliant with the conditions of payment granted herein. 6.6 Costs to the Plaintiff to be taxed in default of agreement because this application has been necessitated by the Defendant's to pay t in one lump sum. R7