Emergency Response Zambia Limited a v First Quantum Minerals Limited (APPEAL NO. 247/2022) [2023] ZMCA 304 (22 November 2023)

IN THE COURT OF APPEAL OF ZAMBIA HOLDEN AT NDOLA (Civil Jurisdiction) APPEAL NO. 247 /2022 BETWEEN: EMERGENCY RESPONSE ZAM PELLANT AND FIRST QUANTUM MINERALS LIMITED RESPONDENT CORAM: SIAVWAPA, JP, CHISHIMBA AND CHEMBE, JJA On 14th and 22nd November, 2023 FOR THE APPELLANT: MRS. S. KALIMA-BANDA, OF MESSRS J & MADVOCATES FOR THE RESPONDENT: MR. M. SAKALA OF MESSRS P & M LEGAL PRACTITIONERS J U D G M E N T SIAVWAPA, JP delivered the Judgment of the Court. Case referred to: DP Services v Municipality of Kabwe (1976) ZR 110 1.0 INTRODUCTION 1.1 On 25th July, 2022, the Honourable Mrs. Justice K. E. Mwenda Zimba delivered a Judgment in the Commercial Division of the High Court. 1.2 The learned Judge dismissed the Appellant's claims for an order that the Respondent, had by conduct, tacitly extended the Emergency Medicine Development Programme (EMDP) contract entered into on 1 st August, 2017. That it was entitled to a specified amount of money and compensation on quantum meruit basis. 1.3 This Judgment 1s on the appeal resulting from the aforementioned Judgment of the High Court. 2.0 BACKGROUND 2.1 By agreement dated 1 st August, 2017, the Respondent appointed the Appellant to be the Manager of the Respondent's support to the Emergency Medicine Training Programme (EMTP) under the EMDP. 2 .2 The programme was designed to run for an initial three-year period, subject to renewal with effect from 1 st August, 2017. 2.3 As manager of the programme, the roles of the Appellant were stated as; to provide technical support, manage and facilitate the Respondent and the Ministry of Health's Emergency Medicine Training Programme. 2.4 At the expiry of the life of the programme on 31 st July, 2020, there were trainees, whose programme was to run up to J2 December, 2020. This meant that the parties needed to either renew the Agreement or enter into a fresh one. 2.5 Neither of the two happened despite negotiations taking place. The training continued nonetheless after the Respondent directly engaged the Ministry of Health. 2 .6 Following numerous email exchanges between the parties, the Appellant, through its advocates; J & M Advocates, wrote a letter of demand dated 18th January, 2021, to the Respondent. 3.0 BEFORE THE HIGH COURT 3 .1 Having not received a favourable response to the letter of demand referred to in paragraph 2.6 above, the Appellant filed a writ of summons and a statement of claim on 2 nd March, 2021. The same was amended once with leave of the Court. 3.2 In both the writ of summons and statement of claim, the Appellant claimed as follows; (i) An order that by its conduct, the Defendant tacitly and impliedly agreed to the extension of the EMDP Contract for the months August 2020 to December 2020; (ii) An order that the Plaintiff is entitled to receive payment for the services it provided during the period post July, 2020, on the basis that the contract was extended by implied J3 consent of the parties and/or on the basis of quantum meruit; (iii) An order that the Plaintiff is entitled to charge the same rates it was charging as at July, 2020 under the EMDP Contract; (iv) Payment of the sum ofUSD 325,000.00 or such other sum the Court finds due and owing, being sums owed by the Defendant to the Plaintiff for services rendered under the EMDP Contract during the period covering August 2020 to December, 2020 which said period covers the contract extension; (v) Interest on all sums found due and owing; (vi) Any other order the Court may deem fit; and (vii) Cost s 4.0 DECISION OF THE HIGH COURT 4.1 After considering the pleadings and the evidence before her, the learned Judge found that the contract between the parties expired by effluxion of time. She furthe r found that the same was not renewed. 4.2 The learned Judge further found that the Respondent had not done or said anything to make the Appellant believe that the Respondent had extended the contract beyond 31 s t July, 2020. J4 4.3 The learned Judge also held that because the contract expired by effluxion of time, there was no basis upon which to award the Appellant damages on the basis of quantum meruit. 4.4 The learned Judge dismissed the cause wholly for want of merit with costs. 5.0 THE APPEAL 5.1 The Appellant expressed its dissatisfaction with the Judgment by filing a Notice and Memorandum of Appeal on 24th August, 2022. 5.2 The Memorandum of Appeal contains the following grounds of Appeal; 1. The learned puisne Judge erred in law and fact when she dismissed the matter on the basis that the Plaintiff had not demonstrated that they had been told to continue when the evidence on record demonstrates the discussions and emails by which there was acquiescence on the party of the Defendant. 2. The learned trial Judge erred in law and fact when she expressly found that indeed work had been done by the Plaintiff in excess of the contract period but still failed to award the Plaintiff payment for the said work on quantum meruit basis. JS 3. The learned trial Judge erred in law and in fact when she held that the Defendant had brought in another person to do the Plaintiffs work when in fact the Plaintiff had already concluded the training of the students and the third party brought in by the Defendant only supervised exams and did not undertake any training. 4. The learned trial Judge erred in law and fact when she held that she could not award the Plaintiffs claim for quantum meruit on the basis that the contract had expired by effluxion of time. 6.0 ARGUMENTS IN SUPPORT 6 .1 The Appellant argued grounds two and four together while it argued grounds one and three separately. 6.2 The gist of the arguments is that the learned Judge had sufficient material by way of emails and discussions passing between the parties to impute an extension of the contract. The Appellant also argued that past conduct by the Respondent of not signing documents but nonetheless acting on them should have satisfied the learned Judge on the Respondent's extension of the contract by previous conduct. 6.3 On grounds two and four the argument is that there was sufficient evidence that the Appellant continued executing its J6 contractual mandate beyond the life of the contract entitling it to an award on the basis of quantum meruit. 6.4 The Appellant cited the case of DP Services v Municipality of Kabwe 1 to argue that even where there was no contract, the doctrine of quantum meruit applied to compensate for work done. 6.5 With regard to the third ground, the Appellant argues that the third party the Respondent hired rode on work already done by the Appellant. 6.6 That based on the fact that the training programme was based on a model developed by the Appellant, the third party only came in to set and administer examinations. 7.0 ARGUMENTS IN OPPOSITION 7.1 The Respondent filed heads of argument on 25th October, 2022 whose mainstay is that the agreement between the parties expired on 31 st July, 2020. That discussions for an extension or renewed agreement broke down and the Respondent informed the Appellant that the agreement would not be extended. 7.2 The Respondent dismissed the Appellant's assertion that the contract was extended by the parties' conduct in view of the J7 Respondent's clear position that the contract would not be extended. 7 .3 On the argument for payment on quantum meruit for work done between July and December, 2020, the Respondent argued that in the face of a clear indication that the agreement would not be renewed, the Appellant did work, if any, for that period at its own peril without the Respondent's consent. 7. 4 On the hiring of a new person to conduct the training, the Respondent argued that because it was a Government programme, it worked with the Government to hire another person after the agreement terminated by effluxion of time. 8.0 OUR ANALYSIS AND DECISION 8. 1 We have taken full cognizance of the appeal and the issues canvassed by the parties. From our consideration of the three grounds argued by the parties, we have narrowed down the dispute to two issues as follows; (a) Whether the contract was extended by the Respondent's conduct and (b) Whether the Appellant did work post expiry of the contract warranting an order for payment under the doctrine of quantum meruit. J8 8.2 It is not in dispute that the EMDP Contract had a three-year life-span running from 1st August, 2017 to 31 st July, 2020 subject to renewal. 8.3 Based on the EMDP Programme status Report of 2020, at page 269 prepared by the Appellant, the self-evaluation letter by the Dean of the School of Medicine dated 23rd July, 2020, to the Respondent and other email exchanges passing between the parties, it is clear that the Emergency Medicine Course (EMC) was owned by the Ministry of Health through the then Chainama College of Health Sciences, which has since been integrated into the Levy Mwanawasa Medical University (LMMU). 8.4 Once the Respondent became aware of the Government's intention to introduce a programme in Emergency Medicine, it responded to the initiative by offering to partner with the Ministry of Health to render financial and other logistical support to the programme. 8.5 The Respondent then, through the Agreement dated 1st August, 2017, appointed the Appellant to manage the programme and the finances from the Respondent to support the programme. 8.6 In our view, the Respondent, being the party that appointed the Appellant to manage the programme, had the discretion J9 whether or not to extend the Contract or propose a new one at the expiry of the earlier one. The Record shows that discussions for a pos sible renewal of the contract took place but failed after the Appellant rejected the offer via a counter proposal. 8. 7 The Appellant would like us set aside the Judgment of the Court below on the basis that the Respondent conducted itself in a manner that made the Appellant believe that it had renewed or extended the Contract from July to December, 2020. 8.8 From the emails exchanged, the record shows that on or about 19th December, 2019, the Respondent gave notice of intention to terminate the contract the parties entered into on 1 st August, 2017, by giving three months' notice (See P340 RoA Volume 1). 8.9 The Appellant responded as shown at page 339, volume one of the Record of Appeal requesting for an extension of the Contract until December, 2020, to allow the students to complete the training. 8.10 Several more emails, whose content cannot be ascertained because they are blurred passed between the parties. However, an email occurring at page 336, volume one , of the Record of Appeal, which was most likely written at the end of August, 2020, in the last paragraph, shows that the Respondent had JlO fulfilled its finan cial support obligation for the period January to June, 2020, leavin g a bala nce outstanding for July, 2020. 8.11 The Record also shows, at page 337, volume one, that the Respondent agreed to continue financing the programme beyond July, 2020 but under different terms. The Appellant counter proposed. 8.12 The Respondent, at page 335, volume one of the Record of Appeal, construed the counter proposal as a rejection of the offer and rejected the counter proposal. Consequent to the above, the Respondent resolved to terminate its dealings with the Appellant and engaged the other stakeholders directly. 8.13 The above background clearly demonstrates that the parties, having acknowledged that the contract would expire in July, 2020, opened negotiations for renewal in December, 2019. 8.14 The background also shows that the parties failed to agree on the new terms resulting in the breakdown of the discussions and the subsequent none renewal of the contract. 8.15 We are therefore; satisfied that contrary to the argument by the Appellant, the contract between the Respondent and the Appellant was not extended upon its expiry on 31 st July, 2020. Jll 8.16 The learned Judge below was therefore, on firm ground to hold as such. 8.17 We have also combed through the record and found no evidence to support the Appellant's view that the Respondent had, in the past and during the negotiations, conducted itself in a way that amounted to extending the contract. In fact, the contrary is true as the Respondent categorically stated its refusal to accept the counter offer by the Appellant. 8.18 The next issue is whether the Appellant is entitled to an award of damages on quantum meruit basis for work it claims to have done between July and December, 2020. 8.19 The learned Judge found that because the contract had terminated by effluxion of time, a claim based on quantum meruit did not arise. 8.20 From the contract signed by the parties, Clause 4 at page 240 volume one of the Record of Appeal, sets out the scope of work the Appellant was contracted to carry out for EMDP. 8. 21 The Appellant's mandated involved the following; To offer technical support to the programme Jl2 To manage and facilitate the Respondent's support to the Ministry of Health for the Emergency Medicine Training Programme. 8.22 This management and support to be undertaken by the Appellant related to having the Respondent and the Ministry of Health execute letters of commitment to supporting the Emergency Medicine Training Programme and establishing a memorandum of understanding between them for the support of Diploma and Certificate Level Emergency Medicine Training Courses. 8.23 In its arguments in support of the appeal, the Appellant has not indicated which one of the above mandates it continued to offer after the expiry of the Contract. In fact, there is no evidence on the record supporting the Appellant's continued work post July 2020. 8.24 In fact, the Appellant argues that when the Respondent hired other personal to continue the programme, the Appellant had already done everything. It submitted that the new entity came to just administer examinations. 8.25 In any case, the two major terms of reference namely, letters of commitment and memorandum of understanding are a one-off assignment done at the beginning of the programme. J13 8.26 It follows that if therefore, that any works not completed as of 31 st July, 2020, the same were taken over by the new party engaged by the Respondent. 8.27 The claim based on doctrine of quantum meruit cannot succeed as the conditions precedent to its application are not present in the relationship between the Appellant and the Respondent. As articulated by the learned authors of Halsbury's Laws of England, 4 th edition, volume 9, as follows; "In some circumstances, a plaintiff may recover on a quantum meruit in respect of work done under a contract which is unenforceable, void or illegal. Where a contract is unenforceable, as a general rule, a Defendant is not precluded by the fact of performance by the Plaintiff from pleading the unenforceability. If however, the contract has been performed by the Plaintiff, and anything has been done by the Defendant upon the doing of which the law would imply a promise to pay, the Plaintiff can recover on the implied promise notwithstanding the unenforceability of the contract. Thus, where work done is done at the request of the Defendant and of which he has the benefit, the Plaintiff can recover on a quantum meruit. Where a contract is void as being made without authority, the Plaintiff, who has rendered services under it, may be entitled to recover on a quantum meru.it. For example, where a contract purporting to appoint a person as Managing Director of a company was found to be a nullity, that person was allowed to recover on a quantum meruit for services rendered and accepted after the date of his purported appointment." 9.0 CONCLUSION 9.1 The evidence on record shows that the Respondent paid in full up to June, 2020. It is not clear if it paid for July, 2020, which would be the only obligation under the contract if it has not paid the amount due. J14 9.2 For the reasons set out in this Judgment, we find no merit in the appeal. We accordingly dismiss it with costs to the Respondent to be taxed in default of agreement. M. J. SIAVWAPA JUDGE PRESIDENT F. M. CHISHIMBA COURT OF APPEAL JUDGE Y. CHEMBE COURT OF APPEAL JUDGE J15