Enock Percy Kavindele v R.M.A. Chongwe and Company [2005] ZMSC 55 (24 November 2005)

f (239) IN THE SUPREME COURT OF ZAMBIA SCZ NO. 19 OF 2005 HOLDEN AT LUSAKA APPEAL NO. 32 OF 2004 (CIVIL JURISDICTION) BETWEEN: ENOCK PERCY KA VINDELE APPELLANT AND R. M. A. CHONGWE AND COMPANY RESPONDENT CORAM: SAKALA, CJ., l\llAMBILIMA AND SILOMBA, JJS On 30th June and 24th November, 2005 For the Appellant: Mr. V. Malambo, SC., of Messrs Malambo and Co. For the Respondent: Dr. R. M. Chongwe, SC., of Messrs R. M. A. Chongwe & Co. JUDGMENT Sakala, CJ., delivered the judgment of the Court. Cases ref erred to: 1. 2. 3. 4. Apollo Enterprise Limited vs. Enock P. Kavindele SCZ/8/47/95 Lewanika & Others vs. Chiluba SCZ/8/EP 3 and 4 of 1996 Th ync vs. Thyne (1955) 3 All E. R. 129 Falche vs. Scottish Impreial Insurance Company (1886-90) All E. R. 760 at769 ., (240) 5. 6. Robert Lawrence Roy vs. Chitakata Ranching Corporation Limited (1980) ZR. 198 Trinity Engineering vs. Zambia National Commercial Bank (1995~ 97) ZR 166 at 168 According to the Memorandum of Appeal, this appeal is against the Judgment of the High Court delivered on 10th November 2003 and also against the Ruling of the High Court delivered on 7th January, 2004. In concluding its judgment dated l 0th November 2003, the Court stated: "These being the observed facts, I hold that the Plaintiff is entitled to the claim of interest on the principal sum which unknown to him was liquidated before 3f,;t July, 2003. This is so, since both paragraphs 231 and 232 of the cited Halsburys' Laws entitle the solicitor to claim of interest on the unpaid bill of costs. However, under paragraph 2]1, the interest is payable when there is specific agreement between the Plaintiff and the Defendant that the latter would pay interest at the close of legal representation at agreed percentage. As it appears the Defendant disputes this agreement and assuming the Plaintifrs learned counsel feels very strongly about this, both parties may come back before me to prove or disprove this agreement. On the contrariwise, there was no agreement between the Plaintiff and the Defendant that 46% was payable as interest on the bill of costs, I find no reason why the Defendant should default paying statutory f (241) interest as spelt out under paragraph 232 of the Halsbury's Laws which is awardable at the discretion of the court, which I would do, but because of what I have already intimated in relation to the existence or otherwise of the agreement between the Plaintiff and the Defendant and what the Plaintiff should do in the presence of such agreement, I have refrained from doing so for the time being."(sic) Following upon the foregoing conclusion, on 13th November 2003, the RP.spondent applied for the review of the judgment of 10th November 2003, pursuant to Order 39, Rule (1) of the High Court Rules. In its ruling of t 11 January 2004, the Court concluded as follows: "Placing reliance on the last authority, I find that I am not functus officio. On the contrary, I can safely review my previous decision by now confirming it as I left it incomplete. While writing my previous judgment, I was under the impression that though the Plaintiff's learned counsel legally represented the Defendants in one contentious matter, namely, APOLLO ENTERPRISE LIMITED V ENOCK P. KAVINDELE m, there was agreement between them that the Defendant would pay interest. Fortunately, the Plaintifrs learned state counsel has verified this fact by denying the existence of such an agreement. ,f a; 2iil (242) In view ut· this clarification which I have now been given, I exercise my discretion under paragraph 232 of the HALSBURY'S LAWS VOL 44 (I) 4 th Edition at page 194 awarding the Plaintiff interest at BANK OF ZAMBIA lending rate effective one month after the date the Plaintifrs learned state counsel delivered the bill to the defendant till payment is made." The foregoing findings and conclusions led to this appeal before us. The facts were common cause. The Respondent, under instructions from the Appellant, undertook to provide legal advice and represented the Appellant in a claim against him, by Messrs Apollo Enterprise Limited. It was not in dispute that the Appellant would pay the Respondent solicitors fees at the conclusion, of the proceedings. This Court detem1ined the proceedings in which the Appellant was being sued in December 1996. On 8th January 1997, the Respondent rendered their account to the Appellant for professional services rendered in the sum of K 18, 150,051 .00. For a period of seven years, the Appellant was served with numerous reminders to pay the fees. On 10th July, 2003, the Appellant settled the principal sum of Kl 8, I 50,051 .00 by remitting the sum of US$ 3,200 (equivalent of K 18,150,051.00) to an account in London in the United Kingdom in the name of and operated by Rodger and Glenda Chongwe. (243) According to the pleadings of the Respondent, interest at 46% of the principal sum, equivalent to K256,653,877.00 and bailiffs fees in the sum of K26,000,000.00 remained unpaid. The Appellant denied owing the Respondent any legal fees contending that he had paid the principal sum in satisfaction of the claim. He also denied owing the Respondent any sums in the outstanding interest on the Respondent's fee note as there had been no agreement for the payment of interest. The action was decided on pleadings after the Court had ordered the Respondent to define the issue for determination on payable interest. The issue for determination was couched in the following terms: "Pursuant to an Order of this Honourable Court made the 26th September 2003 the issue of the law for determination of this Honourable Court on the 21 st October 2003 is:~ Whether or not the unpaid lawyers fees amounting to K18,150,051.00 from the 8th January 1997 or in any amount attract simple interest for the period the said fee note remains unpaid and that the costs of and incidental to this question follow the event." I f (244) On the I 0th of November 2003, after rev1ewmg the parties' arguments, submissions and the law, the Court held that the respondent was entitled to the claim of interest on the principal sum, which unknown to him was liquidated before 3 I si Ju]y, 2003. The Court noted that according to paragraph 231 and 232 of Halsbury's Laws of England, Vol. 44(1) 4th Edition, a solicitor is entitled to the claim of interest on the unpaid bill of costs but that interest is payable when there jr 1. specific agreement between the parties. In the instant case, the Court observed that it appeared there was a dispute between the parties on the existence of the agreement and granted both parties liberty to apply to prove or disprove the existence of the agreement. The Court further found that there was no agreement on 46<¼ interest between the parties but that there was no reason why the Appellant should not pay statutory interest. On ih January, 2004, following upon the purported review of the judgment of 10th November, 2003, the Court found that there was no agreement between the parties. The Court, however, awarded interest, in exercise of its discretion under paragraph 232 of Halsbury's Laws of England Vol. 44(1) 4 th Edition at the Bank of Zambia lending rate effective one month after the Respondents' counsel delivered the bill. f (245) The appeal to this Court is based on two grounds. These are: that the lean1ed trial Judge misdirected himself in law when he agreed to review his earlier decision when conditions for such review did not exist, nor were they sufficiently established; and that the learned trial Judge misdirected himself in law in holding that interest is payable on a lawyer's bill served in respect of contentious business in the absence of a prior agreement for the payment of such interest between the '1wyer and the client. On behalf of the Appellant and the Respondent, written heads of argument were filed in Court supplemented by oral arguments. On ground one, Mr. Malambo, in his written arguments on behalf of the Appellant, submitted in very great detail on the powers of review of the High Court under Order 39 of the High Court Rules. He cited a number of decisions in support of his submissions that included the unreported Ruling in the case of Lewanika & Others V. Chiluba < > in which Chief Justice Ngulube (as he then was) pointed out that "review enables the Court to put matters right. However, I do not believe that the provisions exist simply to afford a second bite or simply to afford a dissatisfied litigant the chance to argue for an alternation to bring about a result considered more acceptable to him". He also cited the case of Thyne V. Thyne (3), a case cited with approval in the Lewanika case. Also cited were the (246) cases of Falche V Scottish Imperial Insurance Company C4l, Robert Lawrence Roy V. Chitakata Ranching Corporation Limited cs>, and Trinity Engineering V. Zambia National Commercial Bank <6>. All these cases discussed circumstances when and when not the Court may exercise its powers of review. The gist of the written arguments and submissions on ground one is that even with the liberalness of language used in Order 39 of the High Court Rules, the power is not limitless; but may be exercised only within the rules discussed in the cited cases. The submission was that the Respondent did not place his case in any of the rules established over the years as to the conditions under which a Court may review its decision and that what happened in this case was simply that the trial Court granted the Respondent a second bite at the cherry. In his oral submissions, Mr. Malambo repeated the written heads of argument but contended that if in fact the trial Judge formed the impression that there was an agreement at first instance, when there was not, it means the issue of agreement was before him when he tried the matter. And he made a finding of fact that there was no agreement. It was submitted that the Respondent did not bring his case within the rules of Court permitting Court to review subsequently, a judgment earlier rendered. (247) The summary of Dr. Chongwe's arguments and submissions in his written heads of argument on ground one, is that the principles oF powers of review in the case of Thyne V. Thyne < > reflect the position in England and Wales and to an extent in Zambia. But that in Zambia, in addition to the slip rule and inherent jurisdiction of the Court, Order 39 rule 1 of the High Court, gives Judges wide powers of review with only two exceptions namely: that the application for review must be made within 14 days of the judgment or decision and that no appeal should have been filed against the decision or judgment. He contended that under the formulation of Lord Morris' principles in Thyne case, Judges of the High Court of Justice in England and Wales do not enjoy similar powers as Zambian Judges on review. Dr. Chongwe submitted that the trial Court's analysis of the powers of review under Order 39 of the High Court Rules is unassailable. Dr. Chongwe further submitted that the trial Judge was entitled to come to the decision he did on 7'h January, 2004 both under our Order 39 of the High Court Rules and under the inherent jurisdiction of the Court as adumbrated in the speech of Lord Morris in the Thyne case. Dr. Chongwe pointed out that the trial Judge, in the judgment of 10th November 2003 , left open the question of whether to exercise his discretion to f (248) order payment of statutory interest on a lawyers unpaid bill pending clarification from the parties as to the existence of an agreement for payment of interest between the Appellant and the Re~pondent prior to commencement of litigation. In his oral submission, Counsel briefly alluded to his written heads of argument on ground one. We have, at great length, deliberately reviewed the arguments and submissions from both learned State Counsel on ground one simply to demonstrate that both learned counsel missed the point as this was in essence not a case of review in the strict sense of the word "review", meaning enabling the Court to put matters right. Indeed, the application of 13th November 2003, itself: by being entitled "APPLICATION FOR REVIEW OF JUDGEMENT DATED THE 107 H DAY OF NOVEMBER, 2003" was misleading and led to the present arguments on ground one. Whether in England or in Zambia, the principles governing the power of the High Court to review its own judgments or decisions are now well established. In our view, both learned State Counsel, in their arguments on ground one, and the Court itself, misapprehended the import of the judgment of 10th November, 2003. (249) Tht• n·h•,·11111 po11io11 or lh:11 j11dp,11H·11I 1t.·lld.'1: u;\H If 111•1H·s11·.ci, flu• l)(•frmlnu1 dl~pnks this nv,n'l'IIH'llf nncl i1.'ls11111i11v, nu• Plnln111J's ki1n1cd coi111sc.~I feel-, very ~frmt~I~· nho111 this~ ho1h 1uu-lkN 11111y <.-onw hnd< before me lo ,,,.ovc or tlls11m,ron· this lll!l'l'l'IIU.'n(" (nnckrlinc ours) · Our u11ders1:111di11g nr " .... .. holh 1rnrllcs may come lrnck hcforc me fo tn·o,·t' or to cllsnppron• this 11~.-Cl'llll'lll,1 ' iH llrnl. tile ( 'onrl was granting lllc pnrth~8 lihl'rly to appl y lo he hc.-.rd on lhc issue of the ex istence of an agreemen t. This libl'rly did 11nl tm·:11111pplic:1lio11 hy wny or rcv1cwi11g llic cmlicr judgment. Under l >rdn J<>, ii is lawl\11 for Ilic Judge "lo 01,cn ~111d rehear the c~t.~c wbolly or In pnrl. nnd lo lnkc fn•sh cvith~m·c, and to reverse, vary or conflrm his IH'C\'lous .lntlgml'll1 or tll•dslou.n But i11 the application envisaged by the t 1ourt !11 thl· im:111111 t·nst\ ns Wl'. 11wll'rsla11d Ilic . J11dg111c11I of' I 0111 Novc111hcr, 200.1, nolhing ~lr wh:11 i~ l't1\·is:1gl'd i11 ( >rdcr Y) t:ould linvc been done. 111 other wor<ls, tht• t \mrt was nut i11\'ilillg Ille p:1rlk8 "io Ol)l'II or rchcnr the cmw wholl. Y or In 1uu·t:• The ( \11111 \\':I~ i11vil i11p, llw p11rlk1i lo lwnr ll1L·1t1 011 IIH". cxi'-llc.rl!:1~ of' :u, t\)J. H'rn11•1111111 p11_,·11wn1 ,11· lnlt'11·11t. 11 w11r1, th1·11•n,11•, w11111,,. 11,r llw H,·11JH111d1•.11i 111 hnn• 1111\llt· n11 "Applkntlou ro,· lh•\'kW ol' .lmlgmc11f dnh.~d llw ro"' 1>11y of (). (250) November, 2003." Equally, the Court should not have treated the application as an application for review of judgment. An ordinary application by way of summons would have addressed the issue as raised by the Court. All in all, this was not a review of judgment in a proper sense ,because the Court had deliberately left the issue of the existence of an agreement between the parties open to be deten11ined on application. It follows that ground one of appeal cannot succeed. It is, accordingly, dismissed. The upshot of the written arguments on ground two is that no interest is payable on a lawyer's untaxed bill of costs where there is no express agreement by the client for the payment of such interest. Paragraphs 214 and 215 of Halsbury's Laws of England, 4th Edition, Volume 44 were cited in support of this argument. Mr. Malambo submitted that the tria] Judge wrongly based his finding on pnragrnphs 23 t and 232 of the same Ha]sbury that in the circumstances of the case, interest was payable on the bill when those paragraphs relate to interest on costs in non-contentious business. Mr. Malambo outlined the principles of law on payment of interest on a lawyer's bill in contentious business as follows: IJ (251) ''(l) ht contentious business, an agreement by the client to pay interest on the costs, if otherwise valid,. seems to be binding. (ii) A taxing master, in tax~tion of costs in contentious business has power, subject to rules of court, to allow interest on money disbursed bv the solicitor on behalf of a client at such rate and ' from such time as he thinks just. This power is restricted to . disbursements and docs not extend to a solicitor's profit costs. (emphasis ours) {iii) Except where there is s1>ecific statutory provision, a taxing master cannot award interest on a solicitor's bill for the period prior to taxation. (h1) After taxation a Taxing Master or the Court may direct that interest be paid on the bill at the current rate on the amount shown to be due on the Taxing Certificate. (,') After t.axation "interest runs from the date as may be ordered as the date on which payment is to be made." (Yi) As solicitor who sues upon his bill of costs and recovers Judgment is entitled to interest upon the amount recovered from the time of signing Judgment." Counsel submitted that the Respondent's case did not fall in any of the above categories and therefore the trial Court was obliged to dismiss the case. Mr. Malambo also argue~ in the alternative that since the trial Judge properly found (as he was bound to do) that the principal sum on the Respondent's bill of costs was fully settled before the commencement of the suit, in awarding (252) interest as he did, he ignored the provisions of the Judgment Act, Cap. 81 of the Laws of Zambia which slalcs that j udgmcnt interest runs "from the time of entering upon such judgment, order or decree .... " Counsel also pointed out that the Court ignored a line of authorities that suggest that interest is awarded normally from the date of issue of writ. Mr. Malatnbo concluded his written heads of argument by submitting that on the facts of this case and the law, the Respondent ought not be heard to argue that the law entitles him to interest on a bill served in contentious business without prior agreement with his client. In the oral submissions, Mr. Malambo stressed that ground two formed the graveman of the appeal. He su_bmitted that as a matter of law there is no interest payable on a lawyer's untaxed bill of costs where there is no express agreement by the client for payment of interest. Mr. Malambo also submitted that interest on a bil1 runs only when it has been taxed because the taxing certificate is the judgment upon which interest runs. He contended that there is no law permitting a lawyer to charge interest on a bill on contentious business before that bill is taxed. In his written response to ground two, Dr. Chongwe maintained that the trial Judge did not misdirect himself on the question of payment of interest on an unpaid lawyer's bill because the parties had agreed before Court for the Judge to determine the question which had been agreed between the parties for I .5 (253) determination. Dr. Chongwe submitted that when the trial Judge adjudged that simple interest is payable on an unpaid lawyer's bill, he was only answering the question posed to him by the parties in_ the affirmative. Counsel contended that there was no misdirection by the trial Judge. Dr. Chongwe pointed out that the Appellant never made any application in tenns of Order 50 Rule 3 of the High Court Rules for the taxation of the bill one month after it was received by him. He pointed out that he infact settled the bill more than six years after the same was sent to him. Counsel contended that during all the six years, the Appellant did not dispute the bill and neither did he request for the bill to be taxed. In his written submissions Dr. Chongwe also argued that according to Section 76 of the Legal Practitioners Act, it is not mandatory that in every contentious h11sin~~s " prnctitioner must enter into a written agreement with his client for his fees to be paid and in the event of tees being settled late, the rate of interest to be paid thereon. Counsel concluded his written response by pointing out that the Respondent complied with the law. It was open to the appe1lant to apply for taxation of the bill if he disputed it; but he did not and has not done so. In his brief oral arguments. Dr. Chongwe submitted that interest is payable even on untaxed bills even in non contentious business. He pointed out that no law denies interest whether the bill is taxed or not. He argued that on unpaid bills~ taxation or no taxation, interest is paid at the discretion of the Court. I<, (254) We have anxiously addressed our minds to the detailed arguments on ground two including the alternative argument by b_oth learned Counsel. The principles governing payment of interest are, in our view, not in dispute. As we have already In its judgment of I 0th observed, this case was decided on pleadings only. November, 2003, the Court held that, the Respondent was entitled to the claim of interest on the principal sum. In that judgment, the Court reserved the issue of the existence of an agreement between the parties to pay interest. In the same judgment, the Court found that there was no agreement between the parties that the Appellant agreed to pay 46% as interest on the bill of costs. The Court went further by observing that it found no reason why the Appellant should default paying statutory interest as spelt out under paragraph 232 of Halsbury Laws of England which is awardable at the discretion of the Court. The Court clearly pointed out in the judgment of 10th November, 2003, that it would have awarded that interest but the issue of the agreement had to be resolved. In the Ruling of ih January, 2004~ the Court opened its Ruling in the following fashion: "In my judgment. of 10111 November, 2003, I left one issue hanging; this relates to the pay:1ble interest. l did this deliberately so that J could hear first from the plaintiff's learned State Counsel if there was an agreement or not between the firm and the defendant to have this interest paid together with legal costs which are a debt at the end of legal representation. Capitalizing on this unresolved issue, the plaintiff's learned State Counsel moved this court on 13th November, 2003 by relying on Order 39 (1) Cap. 27, asking it to review its judgment." (255) In concluding its Ruling, the Court had this to say: "\Yhile writing my previous judgmer~t, J was under the impression that though the plaintiff's learned Counsel legally represented the defendant in one contentious matter, namely, APOLLO ENTERPRISE LIMITED V ENOCK P KAVlNDELE (1), there was agreement between (hem that the defendant would pay interest. Fortunately, the plaintifPs learned State Counsel has verified this fact by denying the existence of such an agreement. In ,,ie,l' of this clarification which I have now been given, I exercise my discretion under paragraph 232 of the HALSBURY'S LAWS VOL 44 (1) 4t11 Edition at page 194 awarding the plaintiff interest at BANK OF ZAl\lBIA lending rate effective one month after the date the plaintifPs learned State Counsel delivered the bill to the defendant till payment is made." Paragraph 232 of Halsbury's Laws of England reads: "232... A solicitor suing a client for costs can claim statutory interest which the court has a discretion to award ............ " The specific question the Court was invited to determine in its judgment of l oth November, 2003 was: "\VHETHER OR NOT THE UNPAID LAWYERS FEES Al\lOUNTING TO K18,150,051.00 FROM THE 8TH JANUARY 1997 OR IN ANY AMOUNT ATTRACT SIMPLE INTEREST FOR THE PERIOD THE SAID FEE NOTE REMAIN UNPAID AND THAT THE COSTS OF AND JNCIDEl'l1:IAL TO THIS QUESTION FOLLOW (256) THE EVENT." This is what the Court resolved in its Rulirig of ih January, 2004. In our view, on the rendered bill, interest is payable at the rate determined by the Court from the date of.presentation of the bill where taxation is not demanded; but if taxation is demanded then interest is payable from the date of taxation. It is not in dispute that in this case the bill was settled after more than six years from presentation and there was no demand for taxation. It follows, therefore, that ground two cannot also succeed. The whole appeal, therefore, fails. It is dismissed with costs to be taxed in default of agreement. E. L. SAKALA CHIEF JUSTICE '- .. ~ .. LC. MAMBILIMA SUPREME COURT JUDGE . . . . ""'- . ..... . A SUPREME COURT JUDGE