Betrich Investments Limited v Finance Bank Zambia Limited (Appeal No. 195/2018) [2019] ZMCA 344 (15 November 2019)

IN THE COURT OF APPEAL FOR ZAMBIA HOLDEN AT LUSAKA ( Civil Jurisdiction) Appeal No. 195/2018 BETWEEN: BETRICH INVESTMENTS LIMITED APPELLANT \ AND FINANCE BANK ZAMBIA LIMITED RESPONDENT Coram: Makungu, Sichinga, Ngulube J. J. A On the 29t h day of March, 2019 and 15t h day of November, 2019 For the Appellant: Mr. M. Haimbe of Sinkamba Legal Practitioners For the Respondent: Mr. M. A. Mukupa of Messrs Isaac & Partners JUDGMENT MAKUNGU JA, delivered the Judgment of t h e Court. Cases referred to: 1. Clementina Banda v. Bomiface Mudimba (2011) ZR vol. 162. 2. Zambia Telecommunications Company Limited v. Muyama Liuwa SCZ Judgment No.16 of 2002 3. Barclays Bank (Z) PLC v. Simfukwe Appeal No. 51 of 2013. 4. Central London Property Trust Limited v. High Trees House Limited (194 7) HB 130 5. Wells Fargo Mortgage I nc v. Federal Home Loan Corporation, case NO. OSCN CN 00944 6. Victor Namakando Zaza v. Zambia Electricity Supply Corporation Limited (2001) ZR 107 7. National Car parks Limited v. Baird (Valuation Officer) and another (2004) EWCA CIV967 8. China H ennan international Economic Technical Corporation v Mwange constructors ltd (2002) ZR 28. 9. Dunlop Pneumatic Tyre Company Limited v Selfrigdge and Company Limited /1915] AC 847. I.. Legislation referred to: 1. Lands and Deeds Registry Act, Chapter 185 of Laws of Zambia 2. The Interpretation and General Provisions Act, Chapter 2 of the Laws of Zambia Works referred to 1. Code of Banking Practice in Zambia, 201 0 1.0 INTRODUCTION 1.1 This is an appeal against the decision of Justice Dr W. S Mwenda made on 16t h March, 2018 dismissing an application by the respondents to set aside a writ of possession and to discharge the mortgage 1n cause No. 2012/HPC/0675. Finance Bank Zambia Limited, which is the respondent in this appeal, was the applicant who had applied for foreclosure and sale of stand No. 896, Lu saka belonging to Betty Chanda Mwikuta Chizyuka. The 1st respondent was Betrich Investments Limited who is the appellant in this appeal. The 2 nd respondent was Betty Chizyuka, the 3 rd respondent was Richard Chizyuka and the claimant was Hotel Macha - Leni Limited. The 2 n d and 3 rd respondents and the claimant are not parties to the appeal. -J2- 2.0 BACKGROUND 2.1 On 21 s t July, 2014, the lower court entered judgment for the applicant in sum of US$809,891.16 being monies outstanding on the credit facilities as at 30th November, 2012 together with interest at the agreed compounded rate up to the date of judgment and thereafter at the prevailing commercial bank lending rate as determined by the Bank of Zambia until full settlement. 2.2 The respondents were given a deferment of ninety days to pay the judgment debt. In default, the applicant was granted liberty to foreclose, take possession of the mortgaged property being stand No. 896, Lusaka and sell it. Costs of the proceedings were awarded to the applicant. The respondents defaulted and the applicant proceeded to foreclose and issue a writ of possession on 27th October, 20 14. Execution of the writ of possession or the sale was stayed ex-parte pending the hearing of the application to set aside the writ of possession and discharge the mortgage. -J3- 2.3 The application to set aside the writ of possession and to discharge the mortgage was supported by an affidavit sworn by the 3 r d respondent namely Richard Chizyuka, a director of the 1st respondent. He avowed that the bailiffs seized the property in question on 25th November, 2016 pursuant to the writ of possession and that the execution was illegal, unfair, unreasonable and malicious for the following reasons: 2. 4 Instead of seizing only the mortgaged property, the bailiffs also seized the moveable chattels, fixtures and equipment belonging to Hotel Macha- Leni Limited (claimant) who had since commenced interpleader proceedings. The writ of possession was executed without notifying the occupants of the subject property who were tenants running the hotel and entitled to six months notice to quit in accordance with the Landlord and Tenant (Business Premises) Act. As a result, the guests at the hotel were forcibly evicted. 2.5 His further averments were that following the judgment, the respondents applied to Development Bank of Zambia (DBZ) for funds to re-finance the loan in question. DBZ approved the refinancing which was to include repayments of the loan and -J4- expanding the business. A letter from DBZ to that effect was exhibited. It was understood and agreed between the parties that enforcement of the judgment would be suspended pending refinancing and the applicant was actually put in the loop concerning the transaction and was directly in con tact with DBZ. 2.6 In consideration of the pending refinancing, the applicant formally and irrevocably undertook to directly surrender to DBZ the Certificate of Title to the property in issue once the disbursement was made directly into the 1st respondent's account held with the applicant upon finalization of the refinancing facility. The written undertaking was exhibited as 'RMC7.' Thereafter, the respondents' started making arrangements to improve the property and to comply with the DBZ conditions such that it expended huge amounts of money. After the property was seized, DBZ was informed about it. DBZ wrote a letter to the applicant confirming its intention to go ahead with refinancing and requesting for more time to finalize the matter. The letter was exhibited as 'RMCS. ' However, on 29th November 20 16 , DBZ advised the respondents in writing that it had decided not to proceed with -J5- the re- financing. That letter was exhibited and marked 'RMClO.' It was deposed further that the applicant acted in breach of its duty not to act in a manner that causes a debtor to fail to pay its debt therefore the mortgage ought to be discharged. 2 .7 The deponent further averred that the applicant waived its right to unilaterally and abruptly issue a writ of possession after consenting and acqu1esc1ng to the respondents' application for refinancing. 2.8 There were three affidavits in opposition filed on 27th October, 2017 by the respondent, all sworn by Hendrix Chiyenge the D ebt Recoveries Manager in the employ of the applicant. The one headed affidavit in opposition to the ex-parte application to stay proceedings was to the effect that the 2 n d and 3 rd respondents are shareholders of both the 1st respondent and Claimant Company as shown in the print outs from PACRA exhibite d as 'HCl' and 'HC2'. As shown in exhibit 'HC2' the claimant company was incorporated on 12 th November, 2013 a year after the foreclosure proceedings were commenced and the deponent reasonably believes that the incorpora tion was -J6- intended to deprive the applicant of the enjoyment of the fruits of the judgment. He also states that the interpleader proceedings are frivolous and vexations as no injustice will be suffered if the property is sold to recover the judgment debt. The prevailing circumstances do not warrant a stay of the sale or stay of proceedings. 2. 9 The other was headed: "Affidavit in opposition to the application for a stay as well as the application to set aside the writ of possession." The crux of it was that the debt owed by the respondents has been outstanding since 30th November, 2012 and judgment in favour of the applicant was rendered on 21 st July, 2014. The applicant has given the respondents enough time to settle the debt and has been magnanimous and lenient enough to withhold the foreclosure. The amount outstanding has accumulated to a large extent and if the matter is not closed, interest will continue to accrue and make it more difficult for the respondents to settle. The respondent's application is inexpedient and no valid reason has been shown to prevent the applicant from enforcing the judgment. -J7- 2.10 The third affidavit was said to be in opposition to the summons to discharge the mortgage and set aside of writ of possession. The gist of it is that the issuance of the writ of possession was m no way malicious, unreasonable or irregular. The applicant owed no obligation to the claimant under the Landlord and Tenant (Business Premises Act) to give notice to quit because the 2 nd and 3 rd respondents are the principal officers of the 1st respondent and claimant who were at all material times aware of the court's judgment. The deponent verily believes that the execution of the judgment was reasonable because the respondents had failed to re finance the loan within a reasonable time as a period of two years and five months had elapsed since obtaining judgment. D BZ had delayed the refinancing process b y a period of one year and five months from the date the applicant had made an undertaking to release the security to DBZ as shown in the exhibit marked 'RMC7' in the affidavit in support. That the deponent was advised by the applicant's advocates that on 28th October, 2016 they notified the respondents' advocates on record at the time Messrs. Muleza Mwimbu and Company of their intention to issue a writ of possession. The applicant -JS- was under no legal obligation to release the title deed as the condition precedent under the irrevocable letter of undertaking was not met. 2.11 Two affidavits in reply were filed on 15th February, 2017. They were both sworn by Richard Chizyuka. The salient points contained in one of them are that: The incorporation of the Macha-Leni Hotel was done in the normal course of business when the previous tenant of the mortgaged property then, known as Macha - Leni Bed and Breakfast, was converted into a limited company known as Hotel Macha - Leni Limited. The said conversion did not at all prejudice the applicant in regard to the enjoyment of the fruits of the judgment as the goods belonging to Macha - Leni Bed and Breakfast would have still been amenable to interpleader proceedings. The 2 nd and 3 rd respondents are also legally liable and cannot hide behind the corporate veil. There was no fraudulent action as the applicant was always aware that the mortgaged property was occupied by tenants. That the interpleader proceedings were genuinely commenced. The claimant will suffer injustice and prejudice if the claimed goods are sold before the interpleader summons are heard and determined. -J9- 2.12 The essence of the other affidavit in reply is that the writ of possession is defective and cannot be allowed to subsist in light of the interpleader proceedings commenced by Hotel Macha - Leni Limited. Macha - Leni Bed and Breakfast started business sometime in 2009. Hotel Macha - Leni Limited was not incorporated with the sole purpose of depriving the applicant of the fruits of the judgment but for the purpose of expanding the business. 2.13 Further averments in reply are that there is no need to lift the corporate veil as there was no fraud in the incorporation of the Hotel. The Hotel was not given notice to quit as prescribed under the Act. 2.14 The irrevocable undertaking made by the applicant to wait for refinancing precluded it from executing the judgment. The irrevocable undertaking had no expiry date. Therefore, the applicant was obliged to give notice of its intention to revoke the undertaking to the interested parties. The mortgage ought to be discharged as the applicant has clogged the right of redemption by its conduct. -JlO- 2.15 The deponent stated further that the applicant's action caused the debtor to fail to pay its loan as it was the issuance of the writ of possession that prompted DBZ to withdraw its intention to re-finance on 30th November, 2016 as the execution would effectively remove the security upon which the intended re-finance was based. 3.0 HIGH COURT DECISION 3.1 Upon considering the affidavit evidence and the written and oral submissions made by the advocates, the learned trial Judge found that the application to set aside the writ of possession lacked merit for the following reasons: 3.2 The applicant was under no legal obligation to release the Certificate of Title as the condition precedent for the release of the security was not fulfilled. The case of Clementina Banda v. Borniface Mundimba 1 upon which the respondents relied, describes the law relating to the two types of waiver correctly. However, in the present case, the applicant did not, by undertaking to release the Certificate of Title, elect to waive its right to issue a writ of possession. The Judge opined that the -Jll- undertaking was made in good faith with the expectation that DBZ would bail the 1st respondent out. 3.3 The lower court stated further that the objective of any mortgage action is to ensure that the mortgagee recovers the monies due to it within a reasonable time. Judgment in this case was delivered in July, 2014 and four years later, the applicant had not yet enjoyed any fruits of its success. The court relied on the case of Zambia Telecommunications Company Limited v. Muyama Liuwa2 where it was held among other things that: "Courts do not make it a habit of depriving successful litigants' fruits of their judgment." 3.4 The court further found that the applicant had not breached the duty owed to the 1st respondent not to act in a manner that could cause the 1st respondent to fail to pay its debt. The Judge noted the rules pertaining to discharge of mortgages which the 1st respondent has not met in this case e.g. paying off the mortgage debt with interest as stipulated in Section 67 of the Lands and Deeds Registry Act. The court finally found that the prayer to discharge the mortgage was misconceived. -J12- 3.5 On the issue of notice to quit, the lower court was of the view that notwithstanding that the 2 nd and 3 rd respondents were directors in the 1 strespondent and claimant companies, the claimant was the 1st respondent's tenant and therefore, the applicant had an obligation as mortgagee in possession to give the claimant the statutory six months notice of termination of the lease agreement pursuant to Section 5(1) and (2) of the Landlord and Tenant (Business Premises Act). The mortgagee under the circumstances of this case took up the role of landlord by virtue of Section 27 of the said Act. The court therefore ordered the applicant to give the claimant the requisite 6 months notice of termination of tenancy relating to stand 896, Lusaka in accordance with the Landlord and Tenant (Business Premises) Act. 3.6 As regards the applicant's claim that the 2 nd and 3 rd respondents fraudulently incorporated the claimant company in order to deprive the applicant of the fruits of its judgment and that therefore this is an appropriate case for the court to pierce the company's corporate veil, the trial Judge found that while ordinarily a formal application for the same is required, there is nothing to stop the court, in exercise of its inherent -J13- jurisdiction, to lift the corporate veil in the interest of justice, where there is an allegation and the evidence adduced necessitates the lifting of the veil to reveal the identities of the persons behind the company. The court found it unnecessary to lift the corporate veil in determining whether to set aside the writ of possession. 3.7 For the aforestated reasons, the application was dismissed with costs and the ex-parte order for stay of execution of writ of possession granted to the respondents on 6 th December, 2016 was discharged. 4.0 THE APPEAL 4.1 The appellant has appealed against the lower court's judgment on 6 grounds which are couched as follows: 1. The court below erred in law and in fact when it proceeded to find that DBZ decided not to proceed with the refinancing it had undertaken to do and thus, the condition precedent to the respondent's undertaking to release the original Certificate of Title of stand No. 896, Lusaka was never met contrary to the evidence on record. -J14- 2. The court below erred in law and in fact when it took into consideration that the judgment being enforced having been delivered in July, 2014 amounted in deprivation of the respondent's fruit of its success since Judgment had been passed four years prior without taking into consideration that the latter's letter of undertaking was irrevocable and contained no clause as to time and had been made in July, 2015. 3. The court below erred in law and fact when it held that the respondent did not elect to waive its right to issue or enforce a writ of possession and that rather it opted to await refinancing by DBZ by the undertaking it made via a letter dated 1st July, 2015 contrary to the evidence on record. 4. The court below erred in law and in fact when it held that the condition precedent for release of the Certificate of Title was not fulfilled despite the fact that there was no evidence that DBZ had changed its mind about disbursing the funds and the fact that the irrevocable undertaking was made in anticipation of future payment by DBZ which contained no time limiting provision. 5. The court below erred in law and in fact when it held that the respondent did not breach any duty owed to the appellant not -J15- t C to act in a manner that could cause the latter to fail to pay its debt. 6. The court below erred in law and in fact when it held that the respondent's act did not amount to a breach of its duty and that the said act did not necessitate a discharge of the mortgage. 5.0 ARGUMENTS ON BEHALF OF THE APPELLANT 5.1 During the hearing of the appeal, the appellant relied on the heads of argument filed on 27 th December, 2018. In support of the first ground of appeal, it was submitted that the release .. of the original Certificate of Title by the applicant to DBZ was predicated upon DBZ availing the 1st respondent the outstanding amount plus continuing interest which was to be used to settle the debt. The finding of the court that DBZ had decided not to proceed with the refinancing prior to the applicant exercising the option to issue the writ of possession was erroneous because it was not supported by the evidence on record. In the absence of a decision by DBZ not to refinance the appellant, the writ of possession was improperly issued and executed. The ruling appealed against was made -J16- 5.3 In support of the second ground of appeal, it was submitted that the trial Judge was heavily swayed by the fact that the judgment was delivered four years prior to execution. She did not consider the intervening events and decided that there had been undue delay for the respondent to benefit from the judgment. It was contented that the trial Judge should have looked at all the circumstances of the case. Counsel conceded that pursuant to the case of Zambia Telecommunications Company Limited v. Muywa Liuwa2 courts do take it seriously that successful litigants should not be deprived of the fruits of judgment. 5.4 However, counsel submitted that in the present case, the respondent voluntarily agreed to suspend enforcement of the Judgment pending the refinancing from DBZ. The respondent even issued a written irrevocable undertaking dated 1st July, 2015 which did not limit the time within which funds should have been dis burs ed. 5.5 In this regard, we were referred to paragraphs 11-14 of the affidavit in support of summons to set aside writ of possession (pages 29 lines 26-38 and page 30 lines 1-7 of the record of -J18- • appeal). Counsel pointed out that at paragraph 13 of the said affidavit is the uncontroverted assertion: "That it was understood and agreed between the applicant and respondent that any possession or enforcement of the judgment herein would be suspended pending the refinancing from Development Bank of Zambia and as a matter of fact, the applicant was put in the loop concerning the transaction and was directly in contact with DBZ." At paragraph 14 is another uncontroverted assertion as follows: "That in consideration of the pending refinancing, the applicant formally and in writing irrevocaqly undertook to directly surrender to DBZ the Certificate of Title to stand no. 896, Lusaka since disbursement was made directly into the 1st respondent's account held with the applicant after finalizing of the financing ,, 'l • aci zty ... fi 5.6 In light of the foregoing, it was contended that it is clear that the respondent decided to waive its right to enforce the Judgment in favor of awaiting refinancing and the case of Clementina Banda v. Borniface Mudimba 1applies. -J19- ,: rl 5. 7 In addition, the second letter provided no clause limiting the time and was issued on 1st July, 2015. The argument that four years had passed since Judgment was delivered holds no water since the respondent opted to issue the undertaking on 1st July, 2015 and execution took place on 25th November, 2016 only a year and four months later. Therefore, the respondent should not claim that it was deprived of the fruits of the Judgment for four years. If time was of importance to the respondent, it ought to have placed a time line on the irrevocable undertaking. Had the learned trial Judge taken into consideration all these factors, she would have come to a different conclusion. 5.8 It was further submitted that the respondent, in the spirit of the Mudimba 111 case, was precluded from enforcing the judgment pending the finalization of the refinancing by the DBZ but unilaterally and prematurely decided to issue the writ of possession. Counsel stated that the Mudimba judgment is of the High Court and is therefore merely persuasive but the High Court drew a lot of inspiration from a plethora of authorities including Central London Property Trust Limited v. High Trees House Limited 141 where Lord Denning held estoppels to be applicable if: -J20- f t "A promise was made which was intended to create a legal relationship and which to the knowledge of the person making the promise was going to be acted on by the person to whom it was made and which was in fact so acted on." 5.9 Counsel submitted that in the circumstances, the respondent was estopped from exercising its right to execute a writ of possession until the refinancing process was completed. 5.10 With regard to the third ground of appeal, it was submitted in the case of Clementina Banda v. Borniface Mudimba 111 where it was espoused as follows: "There are two types of waiver, 'waiver by election' and equitable waiver' waiver by election occurs when a party acts to the knowledge of another party in a way that is consistent with choosing to reply on one of two alternatives and mutually exclusive rights." 5.11 Counsel argued that the trial Judge grossly erred in law and fact that the undertaking did not amount to a waiver of its right to issue a writ of possession. -J21- i • 5.12 Reference was made to the letter of 1st July, 2015 at page 44 of the record of appeal and it was submitted that it should be read together with the uncontroverted averments at paragraphs 13 and 14 of the affidavit in support of the application to set aside the writ of possession. 5.13 It was stated that this entails that there was a waiver by election. We were therefore urged to upset the lower court's findings in this regard. 5.14 On the fourth ground of appeal, it was stated that on 25th November, 2016 DBZ had approved a long term facility to the applicant as follows: 1. USD 1, 200,000.00 to refinance Finance Bank loan and to meet working capital requirement. 11. USD 1, 790,000.00 to finance the completion of hotel construction works. (Re: page 34 of the record of appeal). 5.15 This shows that DBZ was desirous of financing the loan up to the date of execution. There was therefore no event that triggered the execution. The finding of the lower court on this issue was speculative and should be set aside. -J22- i 5.16 Grounds five and six were argued together as follows: Generally a bank has a professional and fiduciary duty not to act in a manner likely to cause injury to its clients. In support of this, we were referred to the American case of Wells Fargo Mortgage Inc v. Federal Home Loan Corporation 151 page 6 lines 16 - 21 and lines 6 - 22. It was stated that this authority though persuasive is instructive where it reads: "The Court finds the defendant Wells Fargo's attitude towards the plaintiff unfathomable. The incredible effort made by the plaintiff to keep the property .... should have been commended not condemned. Wells Fargo's decision to renege on its promises and contract to deceive the plaintiffs with pledge to cancel the foreclosure sale, were outrageous and reprehensible ....... Wells Fargo knew that its decision to foreclose after reinstatement was accepted would injlict a devastating injury on the Holm family." 5. 17 It was submitted further that the duty of care cannot be more demonstrated by the fact that Banker's Association of Zambia formulated the Code of Banking practice to which the respondent herein is a signatory. The objectives of this -J23- . I voluntary Code are to inter alia seek to codify good banking practices for banks to follow when dealing with customers, to encourage higher standards for the benefit of customers. The Code of Banking Practice enshrines how a bank ought to respond in the event that a customer is facing financial difficulties under Clause 11.1.2 which reads: "If you find yourself in financial difficulties, you should let us know and in particular respond to communications we send to you as soon as possible. The sooner we discuss your problems, the easier it will be for both of us to find a solution. The more you tell us about your full financial circumstances, the more we may be able to help you." 5.18 In light of the foregoing, counsel for the appellant contended that the respondent breached the Code of Conduct and went out of its way to make it impossible for DBZ to continue with the refinancing as the security was taken away. The respondent being a bank ought to have known that the refinancing was going to be jeopardized by the issuance of the writ of possession and execution thereof. It was further submitted that on 30th November, 2016 DBZ aborted the refinancing, five days after re- -J24- affirming its commitment to do so. Page 48 of the record of appeal refers. The only reasonable inference that can be drawn from such a cancellation is that it was due to the execution of the writ of possession. 5.19 The respondent clearly breached its duty not to act in a manner that could cause the 1st respondent to fail to pay its debt and necessitate the discharge of the Mortgage. Consequently, the appellant suffered injury. Counsel agreed with the finding of the lower court that the respondent made the undertaking in good faith with the expectation that DBZ would bail the 1st respondent out as expected. He submitted that the good faith exhibited should have been extended a little longer to allow DBZ finalize its internal processes. Instead, the execution of judgment was made in bad faith and negligently, thereby causing damage to the appellant. The respondent should suffer the consequences of its misdeeds and bad faith. 5.20 Counsel submitted further that at page 9 of the ruling, the lower court stated inter alia that it is trite law that a mortgage can only be discharged when all the monies secured by the -J25- mortgage plus interest have been paid. He contended that the court is however, empowered under certain circumstances to discharge a mortgage when a mortgagee acts in bad faith ot in a manner prejudicial to the mortgagor's interest. A proposition was made that the debt should not be written off but the respondent should be deemed to be an unsecured creditor due to the breach of duty. 6.0 RESPONDENT'S ARGUMENTS 6.1 The respondent's advocate relied on its heads of argument filed herein on 11 th February, 2019. Accordingly, grounds one, four, five and six were tackled together as they are interconnected. It is the respondent's submission that the learned trial Judge was on firm ground when she found that DBZ decided not to proceed with the refinancing it had undertaken to do and thus, the condition precedent to the applicant's undertaking to release the original Certificate of Title of Stand No. 896 was never met. That is because the learned trial Judge clearly laid down the foundation leading to her findings as shown on pages 6 - 8 of the ruling where she -J26- analyzed the respondent and applicant's affidavit evidence and gave her reasons for making the findings of fact and holdings. 6.2 Counsel submitted that based on the evidence on record, particularly the letter dated 1st July, 2015 exhibited as 'RMC7' in the affidavit in support, the learned Judge pronounced herself on the issue by finding that DBZ failed to meet the condition precedent to the applicant's undertaking. The finding of the learned Judge was neither speculative nor perverse as it was properly evaluated on exhibit 'RMC7' which demonstrated that to meet the condition precedent set by the applicant, the primary fact is that the appellant failed to have the loan refinanced within a reasonable time and ultimately failed to discharge the mortgage. 6.3 The learned Judge was therefore on firm ground having regard to the facts and evidence on record to find that there was no I breach by the applicant of any duty owed to the respondent. Counsel went on to argue that in the letter dated 25th November, 2016 exhibited as 'RMCS' which the appellant is relying on, DBZ confirmed its failure to meet the condition precedent set by the applicant in its undertaking, as it admits -J27- .. ' I f to not having disbursed the monies to refinance the debt. The said letter was written to the applicant a year after the undertaking was made by the applicant, which amounted to unreasonable delay. 6.4 Furthermore, the said letter was written after the facts and the execution of writ of possession. Evidently, there was a lack of seriousness by both the appellant and DBZ. The learned Judge cannot therefore be at fault for disregarding the contents of the letter dated 25th November, 2016 as it was inconsistent with any rational conclusion. We were therefore urged not to interfere with the lower court's findings of fact. We were referred to the case of Victor Namakando Zaza v. Zambia Electricity Supply Corporation Limited 161 where the Supreme Court held inter alia that: "The findings made by the trial court should not lightly be interfered with." 6.5 On this basis, the prayer was that grounds one, four, five and six be dismissed. 6.6 The respondent's counsel dealt with grounds two and three together as they are also related. The arguments were as -J28- t I 'j f follows; that the trial judge was on firm ground when she accepted the appellant's submission that the objective of any mortgage action is to ensure that the trial Judge was on firm ground when she accepted the appellant's submission that the objective of any mortgage action is to ensure that the mortgagee recovers the monies due to it within a reasonable time. Counsel submitted further that it is reasonably plain from reading the entire judgment that the learned Judge looked at all the circumstances prevailing, particularly the contents and effect of the applicant's letter of undertaking. The lower court considered and distinguished the case of Clementina Banda v. Borniface Mudimba 1 on page 8 of the ruling and rightly found that the applicant in this case did not, by undertaking to release the Certificate of Title, elect to waive its right to issue a writ of possession. 6. 7 Further submissions on behalf of the respondents were that the fact that the letter of undertaking contained no clause as to time within which the funds should have been disbursed, really does not help the appeal as it amounts to a mere excuse for the appellant's failure to meet the condition precedent within a reasonable time. Notwithstanding the irrevocability of the -J29- ' ' . undertaking did not oust the application of the law to the construction of the letter. 6.8 In properly applying the law, with regard to the letter containing no Clause as to time to do an act, the respondent relied on Section 36 of the Interpretation and General Provisions Act which provides: "Where no time is prescribed, or allowed within which anything shall be done, such things shall be done without unreasonable delay, and as often as due occasion arises." 6.9 To fortify the foregoing submission, reliance was also placed on the case of National Car parks Limited v. Baird (Valuation Officer) and another 181 wherein the court made the following observations: "Where a party undertakes by contract to do an act, the performance of which depends entirely on himself, and the contract is silent as to the time of performance, the law will imply a term that the act should be performed within a reasonable time (see Chitty on Contracts (29th edition, 2001) vol. 1, page 1246 (paragraph 21- 020). Such a term will be implied because it represents the unexpressed -J30- . . " . intention of the parties or is necessary to give business efficacy to the contract." 6.10 It is further submitted that the respondent did not waive its right to execute the judgment of July, 2014 and that there was inordinate and inexcusable delay by DBZ to refinance the loan, especially after the respondent's advocates Muleza Mwiimbu and company, were duly notified on 28th October, 2016 of the applicant's intention to issue a writ of possession of the property in the event that the loan was not promptly settled/ and or refinanced. The appellant and DBZ only woke up from their slumber after the execution of possession, which was over a year after the applicant's letter of undertaking. 6.11 There were no special circumstances or sufficient grounds established by the appellant in the lower court to justify the deprivation to the respondent of the fruits of the judgment. The prayers were that grounds two and three of the appeal also be dismissed. That the appeal be dismissed in it's entirely for lack of merit and the ruling of the lower court dated 16th March, 2018 be upheld. -J31- 6.12 In the arguments in reply filed by the appellant on 29th March, 2019 were as follows: 6.13 The arguments earlier made by the appellant's advocates were paraphrased. The only additions were authorities on the propositions that the contents of the paragraphs before line 14 of the affidavit in the reply should have been traversed; China Henan international Economic Technical Corporation v Mwange contractors limited8 and order 53 (6) of the High Court Rule. That in China Henan the question concerned the statement of claim. However, counsel suggested that the law extends to affidavit evidence. Reliance was also placed on order 45(3) of the Rules of the Supreme Court which describes a writ of possession as enforcement of a judgment or order for possession of land. 6.14 It was therefore submitted that the writ of possession should have been set aside even for the sole reason that the goods and chattels that belonged to the hotel which were not supposed to be seized were seized. Finally, the prayer was that the appeal be allowed and the ruling of 16th March, 2018 be set aside with costs. -J32- 7.0 DECISION OF THIS COURT 7. 1 We have carefully considered the record of appeal and are indebted to counsel for their submissions. We shall deal with all the grounds of appeal together as they are connected. 7 .2 The record shows that the judgment in favour of the respondent which was being executed was delivered on 21 st July, 2014. The judgment was for US$ 809,891.16 which was outstanding on credit facilities as at 30th November, 2012. According to the judgment, the respondents were given a deferment of ninety days to pay the judgment debt. Accordingly, the deadline for payment was around 21 st October, 2014. However, they defaulted. It is important to reflect on what transpired before the writ of possession was issued. 7.3 The appellant had applied to DBZ for refinancing in order to improve its business. On 1st July, 2015 about a year after the judgment, the respondents wrote an "irrevocable letter of undertaking to release security" to DBZ; the original certificate of title relating to stand no 896 Lusaka in the name of Betty Chanda Mwikuta Chizuka together with the necessary -J33- .. f I • • documentation required to discharge its interest over the said property as soon as the appellant was availed with the outstanding amount, plus continuing interest. 7.4 By 25th November, 2016 which was about a year and four months later DBZ had not yet disbursed the approved facility to the appellant due to the lapse of the availability period. This was confirmed in the letter from DBZ to the respondent dated 25th November, 2016. The writ of possession was executed on the same date. It is clear that the lower court and the respondent had given the appellant enough time to settle the judgment debt. 7.5 We take the view that the respondent did not at all breach its duty to ensure that the appellant does not fail to settle the debt because firstly, it went out of its way to try and help the appellant in accordance with the code of Banking. Secondly the irrevocable letter of the undertaking was made after the judgment of the lower court. There was no stay of execution of the judgment at the time that the writ of possession was executed. The irrevocable undertaking could be taken as stay of execution. -J34- • 7.6 The undertaking was made to DBZ which is not even a party to this case and not to the appellant. Under the circumstances the appellant cannot enforce the undertaking. The case of Dunlop Pneumatic Tyre Company Limited v Selfrigdge and Company Limited9 refers. 7.7 Nevertheless, the refinancing should have been done within reasonable time according to section 36 of the Interpretation and General Provisions Act. DBZ took over a year to disburse the approved facilities to the appellant and that in our view was unreasonably long. 7 .8 In the letter dated 25th November, 2011 from DBZ to the respondent, DBZ actually, requested for more time to enable the disbursements towards the refinancing of the loan. The respondent therefore acted prudently not to sit back and wait indefinitely for the payment. Under the circumstances, the lower court rightly found that the condition precedent for the release of certificate was not fulfilled. In the letter of 30th November, 2016 from DBZ to the appellant it was clearly indicated that the project management committee had declined the appellant's request for the extension of the facility -J35- availability period. We accordingly take it that the reason for the decision not to proceed with refinancing was as stated in the letter and not because of the execution of the writ of possession. 7. 9 Applying the case of Clementina Banda v Bornifance Mudimba 1 , we have no difficulty in endorsing the lower court's finding that the respondent did not by undertaking elect to release the certificate of title, elect to waive its right to issue a writ of possession. The appellant's argument that the respondent should be deemed to have admitted paragraphs 13 and 14 of the affidavit in support of summons to set aside the writ of possession because they did not specifically traverse the same cannot stand because firstly, the case of China Hennan International Economic Technical Corporation v Mwange Constructors Limited8 and Order 53(6) of the High Court Rules relate to pleadings and not evidence. 7.10 Secondly, as already stated enforcement of the judgment was suspended for long enough and could not be suspended indefinitely. It is trite law that a successful litigant should not -J36- be deprived of the fruits of the judgment, the case of Zambia Telecommunications Company Ltd v. Muyama Liuwa2 refers. 7.11 Coming to the purpose of a writ of possession under order 45 / 3 of the Rules of the Supreme Court: To enforce a judgment or order for possession of land, we are of the view that the seizure of the chattels and other goods owned by Hotel Macha-Leni did not render the execution null and void such that the writ of possession should be set aside. Hotel Macha-Leni has already filed interpleader summons. Therefore, seizure of the land and seizure of the good are severable. It would not be in the interest of justice to set aside the writ of possession since the judgment of the lower court for foreclosure and sale of the property is still valid and enforceable. -J37- 8.0 CONCLUSION 8.1 All in all, the appeal is dismissed for lack of merit with costs to the respondent which may be agreed upon between the parties or taxed in default of agreement . ............ L-; ....... @: ...... . C. K. MAKUNGU COURT OF APPEAL JUDGE ...•••......•.......••......••.....••...... P. C. M. NGULUBE COURT OF APPEAL JUDGE \ -J38- ~ ..... ~ .... £!' .