Daewood Engineering and Construction Ltd v Consolidated Farming Ltd and anor (Appeal No.23/2022; CAZ 08 420 of 2021) [2023] ZMCA 181 (30 June 2023)

Daewood Engineering and Construction Ltd v Consolidated Farming Ltd and anor (Appeal No.23/2022; CAZ 08 420 of 2021) [2023] ZMCA 181 (30 June 2023)

The Commitment Agreement signed by the 1st Respondent's employee was not enforceable due to lack of consideration and privity; the Appellant had no right to detain the 1st Respondent's equipment and is liable for damages, but the quantum of demurrage must be assessed by the Registrar due to lack of evidentiary basis.

Source-derived case information.

Citation
[2023] ZMCA 181
Parties
Appellant: Daewoo Engineering & Construction Limited; 1st Respondent: Consolidated Farming Limited; 2nd Respondent: Clement Mugala (Receiver/Manager of Keren Motors Limited [In Receivership])
Court
Court of Appeal of Zambia
Jurisdiction
Zambia
Case Number
Appeal No.23/2022 ; CAZ 08 420 of 2021
Procedural Posture
Civil Appeal / Judgment
Outcome
Appeal dismissed against 1st Respondent except for damages assessment; demurrage award set aside and referred for assessment; costs awarded to 1st Respondent; Appellant awarded costs against 2nd Respondent on counterclaim.
Legal Topics
Obligations Under Contract, Privity of Contract, Damages Assessment, Equitable Lien, Environmental Compliance
Source Language
en
Contract Law Commercial Law Environmental Law Obligations Under Contract Privity of Contract Damages Assessment Equitable Lien Environmental Compliance

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Parties

Daewoo Engineering & Construction Limited

Appellant

Consolidated Farming Limited

1st Respondent

Clement Mugala (Receiver/Manager of Keren Motors Limited [In Receivership])

2nd Respondent

Procedural Posture

Civil Appeal / Judgment

  1. 1 Whether the 1st Respondent assumed the 2nd Respondent's obligations by purchase and by signing the Commitment Agreement
  2. 2 Whether the Commitment Agreement was binding on the 1st Respondent
  3. 3 Entitlement to damages for detention of equipment and trailers

Ratio Decidendi

The Commitment Agreement signed by the 1st Respondent's employee was not enforceable due to lack of consideration and privity; the Appellant had no right to detain the 1st Respondent's equipment and is liable for damages, but the quantum of demurrage must be assessed by the Registrar due to lack of evidentiary basis.

Court Disposition

Appeal dismissed against 1st Respondent except for damages assessment; demurrage award set aside and referred for assessment; costs awarded to 1st Respondent; Appellant awarded costs against 2nd Respondent on counterclaim.

Orders

  • Demurrage charges of US$500 per truck-trailer per day set aside and referred to Registrar for assessment.
  • Appellant to pay damages to 1st Respondent for detention of trucks and equipment, quantum to be assessed.