Gargaar Freighters Limited v Kemcore Zambia Limited (2023/HN/198) [2024] ZMHC 256 (9 December 2024)

Before: The Hon. Lady Justice Dr. Winnie Sithole Mwenda at Ndola this 9th day of December, 2024 For the Plaintiff: Ms. K. Nalondwa and Ms. S. Mayeya of Messrs. AMW & Company For the Defendant: Mr. J. N. Kapasa of Messrs. JN Kapasa JUDGMENT Cases referred to: 1. Printing & Numerical Registering Co v. Sampson (1 s··, 2 . Trollop and Calls Limited v. Northwest Metropolitan RegionaFffo spital if~\ ~~::~. _~_-.#- ~:½-~:_ .. - Board /1973] 1 W. L. R. 601 3. African Banking Corporation (Z) Limited (ti a Bank ABC) v. Plinth Technical Works Limited Selected Judgment No. 28 of 2015 4. Holmes Limited v. Buildwell Construction Company Ltd (1973) ZR 97. 5. Rapid Global Freight Limited v. Zambia Railways Limited CAZ Appeal No. 216/2019. 6. Finance Bank Zambia Limited and Rajan Mahtani v. Simataa Simataa SCZ Selected Judgment No. 21 of 201 7. 7. Mappouras v. Waldrons (2002) ALLER D 299. Authoritative text referred to: 1. Ng'ambi, Sangwani Patrick and Chungu, Chanda, Contract Law m Zambia: 2 nd Second Edition (2021) Juta . J2 1. Introduction 1.1 On 4th May, 2023, the Plaintiff commenced an action against the Defendant in the District Registry by way of Writ of Summons and Statement of Claim for the following remedies: (i) Immediate payment of the sum of USD290,299.54 being sum due and outstanding to the Plaintiff pursuant to an agreement entered into between the Plaintiff and the Defendant for transportation services; (ii) Damages for breach of agreement referred to 1n (i) above; (iii) Damages for loss of business; (iv) Interest; (v) Costs; and (vi) Any other relief the Court may deem fit. 1.2 In the Statement of Claim alluded to above, the Plaintiff claimed that it is a limited company incorporated under the Laws of Zambia and so is the Defendant. 1.3 That b S · ' ya erv1ce Order Agreement entered into between the Plaintiff and the Defendant sometime around the J3 11th day of July, 2022, ("the Agreement"), the Plaintiff agreed to provide road carrier transportation services to the Defendant ("the Transportation Services"), on the following agreed terms: (i) The Plaintiff would transport sulphuric acid from the pick-up point to the offloading point stated in the Agreement at the quantity and rate agreed therein; (ii) The Plaintiff would issue proof of delivery to the Defendant, in the form of invoices and statement of accounts, among other documents; (iii) The Defendant would pay for the transportation services within fifteen days of receipt of invoice. 1.4 In pursuance of the said Agreement, and on dates between the 31 st day of July, 2022 and 6 th day of April, 2023, the Plaintiff in accordance with the agreed terms, issued the Defendant with invoices for the total sum of USD290,299.54 ("the Invoiced Sum"). 1.5 That, in breach of the Agreement, the Defendant has since the date of the Agreement, failed, refused and/ or neglected to make any payment towards liquidation of J4 the invoiced sum, and following the said default, the Plaintiff engaged the Defendant to make good the default, but despite admitting its indebtedness, the Defendant failed to pay as agreed. 1.6 By reason of the matters aforesaid, the Plaintiff suffered loss of business for which the Defendant is liable under the Agreement. 1. 7 The Plaintiff was prompted to engage the Defendant to demand for payment of the balance by letter of demand dated 20th April, 2013, and despite repeated requests by the Plaintiff and its advocates, the Defendant has failed, refused and/ or neglected to settle the invoiced sum, thereby accruing a debt of USD290,299.54. 1.8 That, as a consequence of the foregoing, the Plaintiff has suffered loss and claims from the Defendant as per endorsement on the Writ of Summons. 2. Defendant's Defence 2 . 1 The Defendant entered appearance and filed its Defence on 15th May, 2023 wherein it averred that Kemcore Zambia Limited belongs to the Kemcore Group of Companies, which group includes: Kemcore Zambia JS Limited whose registered place of business is at Plot 3767, Zambia Road, Heavy Industrial Area, Ndola; Kemcore Botswana (Pty) Limited, whose registered place of business is at Plot 152, Giop, Gaborone, Botswana; Kemcore South Africa (Pty) Limited whose registered place of business is at Unit 8, Mulberry Hill office , Broadacres Drive, Johannesburg, South Africa; Kemcore International DMCC (Trading from Dubai); and Kemcore RDC SAS, a Democratic Republic of Congo registered company. 2.2 That, the aforementioned companies, 1n spite of belonging to the group, are separate corporate entities and as such, are individually liable for their own obligations. 2.3 The Defendant admitted that the Plaintiff issued the Defendant with various invoices between the mentioned dates but that the said invoices did not amount to USD290,299.54 as alleged by the Plaintiff. 2.4 Further, that the Plaintiff in its computation erroneously included amounts from invoices issued to Kemcore Botswana (Pty) Limited. J6 2.5 The Defendant claimed that the sum of USD58,373.84 is the total of the invoices issued by the Plaintiff to the Defendant broken down as follows: (a) Invoice dated 19th December, 2022 for USD6, 755.30; (b)Invoice dated 4 th January, 2023 for USD13,342.90; (c) Invoice dated 9 th January, 2023 for USD 13, 450.40; (d)Invoice dated 31st January, 2023 for USD20,674.40; and, (e) Invoice dated 6 thFebruary, 2023 for USD4, 150.84. 2.6 The Defendant further claimed that according to its records, it has discharged its obligations with the Plaintiff and any outstanding amounts would be the obligation of Kemcore Botswana (Pty) Limited which was invoiced. 2.7 That, the debt was not and has still not been adjusted to reflect the actual amount owed by the Defendant, if any, to the Plaintiff. 2.8 Further, that the reliefs sought by the Plaintiff are in excess of what might be owing to it by the Defendant and would amount to unjust enrichment of the Plaintiff. J7 3. Plaintiff's Reply 3.1 The Plaintiff filed a Reply to the Defendant's Defence wherein it stated with regard to the email instruction of the Defendant dated 23 rd November, 2022, that the Plaintiff was instructed to issue invoices in the names of the Defendant and Kemcore Botswana. 3.2 Further, that the obligation to pay the sum of USD290,299.54 remained with the Defendant at all material times. 3.3 The Plaintiff averred that contrary to the Defendant's assertion, the 1nvo1ces issued to the Defendant for transportation services were not erroneously or wrongfully made. That, the invoices were itemised and issued in the names of Kemcore Zambia Limited and Kemcore Botswana (Pty) Limited pursuant to the express instructions of the Defendant by email dated 22 nd November, 2022. 3.4 That, contrary to what the Defendant has claimed, the total sum invoiced by the plaintiff to the Defendant for services rendered by the Plaintiff aggregates a total sum of USD290,299.54. JS 3.5 Finally, that the Defendant has failed, refused and/ or neglected to settle the invoiced sum and is therefore, still liable to the Plaintiff for the sum of USD290,299.54. · 4. Summary of Evidence 4.1 The matter came up for trial on 20th September and 8 th October, 2024. 4.2 The single witness for the Plaintiff was Abdikarim Ali Ibrahim, the Operations Manager in the Plaintiff Company, who testified on behalf of the company. His witness statement dated 6 th November, 2023 was tendered and duly admitted in evidence. He shall be referred to as "PW". 4.3 It was PW's evidence that he first became aware of the Defendant sometime on or around the 11 th July, 2022 when the Plaintiff and Defendant entered into a Service Order Agreement in which the Plaintiff agreed to provide road carrier transportation services to the Defendant. That, a copy of the said Agreement appears on pages 1 - 3 of the Plaintiff's Bundle of Documents. 4.4 That, according to clauses 1 to 3 of the Agreement, the Plaintiff agreed to transport sulphuric acid from J9 Kansanshi Mine in Solwezi to Luputo and Metalkol Mines, respectively, at the following rates; Kansanshi Mine to Luputo Mine at USD150/ton and Kansanshi Mine to Metalkol Mine at USD200/ton. 4.5 It was a term of the Agreement in clause 4 (d) that, upon delivery of the goods, the Plaintiff would issue, among other documents, invoices and up to date statements of accounts to the Defendant. In turn, the Defendant agreed in clause 4 (a) to pay for the services within fifteen days of receipt of any invoices issued following the provision of the services. 4.6 As per the Agreement, the Plaintiff, at the Defendant's instance, carried out the services in accordance with the agreed terms on various dates between 31 st July, 2022 and 6t h April, 2023. 4.7 Further to the above , and on the basis of, by way of an email instruction from the Defendant dated 23 rd November, 2022, the Plaintiff was instructed to issue invoices in the names of the Defendant and Kemcore Botswana (Pty) Limited. The email appears on page 19 of the Plaintiff's Bundle of Documents. JlO 4.8 The email was couched in the form of a directive from the Defendant to the Plaintiff instructing the Plaintiff that all loads from Kansanshi to KCC should be invoiced to the Defendant and all loads from Namibia and Kansanshi to Metalkol, Chemaf, Golden Africa should be invoiced to Kemcore Botswana. 4 .9 PW further testified that according to the Plaintiff's understanding, Kemcore Botswana is and was at all material times, a company belonging to the Kemcore Group of Companies and has its registered address at Plot No . 152, GICP, Gaborone, Botswana. 4.10 That, the Plaintiff's position is that the email instruction was an internal matter between the Defendant and Kemcore Botswana and cannot be used as a shield to avoid liability as the Plaintiff simply adhered to the instruction in good faith. 4.11 Consequently, the Plaintiff issued separate invoices in the names of Kemcore Zambia Limited and Kemcore Botswana, respectively, for the total sum of USD290,299.54 as evidenced by documents at pages 4 to 18 of the Plaintiff's Bundle of Documents. Jll 4.12 That, following the above, the Plaintiff engaged the Defendant to make good of the invoiced sum but the Defendant failed to pay the same as agreed. PW referred this Court to pages 15 to 18 of the Plaintiff's Bundle of Documents where copies of the Plaintiff's Statements of Accounts issued on 6 th April, 2023 and 20 th April, 2023 were exhibited. 4.13 PW further testified that the Plaintiff was prompted to engage the Defendant to make good of the invoiced sum by way of demand letter dated 23 rd April, 2023. However, the Defendant failed, refused and/ or neglected to make any payment towards the invoiced sum. The letter of demand is exhibited at page 21 of the Plaintiff's Bundle of Documents. 4.14 That, due to the Defendant's failure to settle the invoiced sum, the Plaintiff was compelled to commence the present action on 4 th May, 2023. 4.15 On 15th May, 2023, the Defendant filed its Defence wherein it claimed that it fulfilled its obligations and the outstanding invoices are the responsibility of Kemcore Botswana. Jl2 4. 16 According to PW, there is and was at all material times, no agreement between the Plaintiff and Kemcore Botswana, but rather only between the Plaintiff and the Defendant. That, the Plaintiff was only made aware of Kemcore Botswana when the Defendant issued instructions through the email of 23 rd November, 2022 requesting that separate invoices be issued in the name of Kemcore Botswana. 4.17 Further, that the Defendant requested the Plaintiff to issue the said invoices to Kemcore Botswana based on their own internal understanding and now attempts to use this as a shield to escape liability. 4.18 Following the above, the Defendant later reaffirmed its indebtedness to the Plaintiff through a WhatsApp conversation on the 7 th and 8 th July, 2023. In the WhatsApp conversation, the Defendant enquired about how they could make a part payment in the sum of USD75,000.00 to the Plaintiff and proposed payment in Kwacha equivalent. A copy of the WhatsApp conversation was produced at pages 23 to 25 of the Plaintiff's Bundle of Documents. Jl3 4.19 That, pursuant to the WhatsApp conversation in which the parties discussed payment of the invoiced sum, the Defendant made three separate bank transfers to the Plaintiff's account held with Atlas Mara Zambia on 19th July, 2023 which were processed from the Defendant's Stanbic Bank Zambia Limited account and were for the sums of K500,000.00, K500,000.00 and K400,000 .00, respectively. Copies of the proof of payment were produced on pages 23 to 25 of the Plaintiff's Bundle of Documents . 4.20 PW further testified that, as a result of the aforementioned part payments, the amount owed to the Plaintiff was reduced to USD215,299.54. However, upon engaging in a reconciliation of its records, the Plaintiff identified invoices totalling the sum of USD 19,389.00 which had been inadvertently omitted and not delivered to the Defendant. Copies of the additional invoices were produced at pages 1 to 4 of the Plaintiff's Supplementary Bundle of Documents. 4.21 The Plaintiff duly corrected this oversight and provided the Defendant with the additional invoices on 10th Jl4 September, and confirmation of receipt acknowledged with a date stamp by the Defendant. 4.22 Further still, the Plaintiff also provided to the Defendant on the same date , an amended statement of accounts which correctly indicated the total amount owed as USD241,503.84. Since then, there have been no further payments from the Defendant, leaving an outstanding balance of USD241,503.84 unpaid. 4 .23 In cross-examination, PW admitted that payment for the services rendered was dependent on proof that the company had delivered goods to the intended destination. Further, that the Plaintiff had to produce a valid invoice in the name of Kemcore Zambia Limited in order to be paid. 4.24 PW admitted that there were some payments from the Defendant to the Plaintiff and that the Plaintiff had only been paid by Kemcore Zambia Limited, the Defendant herein. 4.25 In further cross-examination, PW admitted that at page 4 of the Defendant's Bundle of Documents was a Payment Transaction Report from Stanbic Bank Botswana Limited JlS showing an amount of USD 20,588.00 and the name Kemcore Botswana and on page 6 there was another Payment Transaction Report issued by Stanbic Bank Botswana Limited showing an amount of USD45.444.00 and Kemcore Botswana. PW further said that at page 7 was another Payment Transaction Report from Stanbic Bank Botswana Limited showing an amount of USD20,588.00 and beneficiary reference of Kemcore Botswana. 4.26 Under further cross-examination, PW admitted that at pages 6, 7 and 8 of the Defendant's Bundle of documents, the Plaintiff, Gargaar Freighters Limited, 1s listed as the beneficiary of the payments. He, however, disagreed with the assertion that proof of payment showed that Kemcore Botswana was paying Gargaar Freighters Limited. 4.27 PW further confirmed that he did receive a reconciliation from the Defendant which showed that USD58,373.84 was paid. 4 .28 When referred to page 17 of the Defendant's Bundle of Documents, PW confirmed that the document showed J16 Stanbic Bank Botswana Limited and the amount paid was USD33,669.00. The date of payment was 4 th March, 2023. That, the beneficiary was Gargaar Freighters Limited, the Plaintiff herein. 4.29 PW further confirmed that the Plaintiff received the sums of KS00,000.00, K410,000.00, another KS00,000.00 and K 1,410,000.00 from Kem core Zambia on various dates. However, PW disagreed when it was put to him that there was an overpayment from Kemcore Zambia. He admitted that the USD20,674.40 at page 4 of the Plaintiff's Bundle of Documents 1s part of the USD58,373.84 mentioned in paragraph 7 of the Defence. 4.30 It was PW's evidence under further cross-examination, that there were amounts addressed to Kemcore Zambia Limited and some to Kemcore Botswana Limited. Further, that the name Kem core Botswana appeared on some invoices and statements and that Kemcore Zambia Limited appeared on three statements produced. 4.31 PW disagreed that the Defendant has paid all that's due from it. He, however, agreed that invoices for Kemcore Zambia were addressed to Kemcore Zambia and those Jl7 for Kemcore Botswana were addressed to Kemcore Botswana. 4.32 In re-examination, PW stated that when he added the amounts at pages 13, 14 and 15 of the Defendant's Bundle of Documents, he got a total of USD38,275.64. That, whenever they received payment, the document came from Kemcore Zambia and the document showed Kemcore Botswana (Pty) Limited. 4.33 PW further clarified that the Plaintiff was only dealing with Kemcore Zambia depending on the instructions they gave them. 4.34 The Defendant's witness was Patience Kanyika Zulu, the Defendant's Project Planner /Director. She will be referred to as "DW". 4.35 DW's witness statement dated 24 th July, 2024 was tendered in evidence and admitted as her evidence in chief. 4.36 It was DW's evidence that she joined Kemcore Zambia Limited in April, 2019 as Finance Administrator and was later appointed as one of the Directors at Kemcore Zambia Limited . In 2024, she was assigned to a new role Jl8 as Project Planner, the position which she currently holds in addition to her role as Director of the company. 4.37 DW testified that in 2022, Kemcore Zambia Limited and Kemcore Botswana (Pty) Limited needed to move sulphuric acid from Zambia to the Democratic Republic of Congo (DRC). On 10t h June, 2022, Kemcore Zambia Limited signed a Service Order Agreement with Gargaar Freighters Limited for transportation of sulphuric acid from Zambia to DRC . DW referred the Court to a copy of the Agreement which is produced at pages 1 - 3 of the Defendant's Bundle of Documents. 4.38 That, between June, 2022 and February, 2023, Gargaar Freighters Limited transported sulphuric acid on behalf of Kemcore Zambia Limited and at the end of March, 2023, Kemcore Zambia was owing Gargaar Freighters Limited a sum of USD58,373 .84. DW referred the Court to invoices exhibited at pages 9, 12, 13, 14 and 15 of the Defendant's Bundle of Documents and to a reconciliation of the amounts appearing at page 16 of the Defendant's Bundle of Documents. J19 4.39 It was DW's further evidence that on 19th July, 2022, Kemcore Zambia Limited made three payments to Gargaar Freighters Limited totalling Kl,410,000.00 from its Standard Bank Account. The amount was equivalent to USD75,000.00 to settle the amount owing to Gargaar Freighters Limited. The amount Kemcore Zambia paid was over USD 16,626.16. That, this was erroneously done as the company never intended to overpay Gargaar Freighters by that amount. DW testified that the proof of payments appears on pages 18 - 20 of the Defendant's Bundle of Documents. 4.40 According to DW, on 23 rd November, 2022, Ms. Fatu Bah, an employee of Kemcore Zambia Limited, was instructed to send an email to Gargaar Freighters Limited to correct the billing address on new invoices submitted for service which were being rendered to Kemcore Botswana (Pty) Limited. That, Gargaar Freighter Limited was invoicing Kemcore Zambia Limited for services not rendered to it but to Kemcore Botswana. For this assertion, DW referred the Court to Ms. Fatu J20 Bah's email exhibited at page 19 of the Plaintiff's Bundle of Do cum en ts. 4.41 On 9 th August, 2022, Kemcore Botswana (Pty) Limited made a payment to Gargaar Freighters Limited, this payment having been made before Ms. Fatu Bah sent Gargaar Freighters Limited an instruction to separate the invoices. That, this goes to show that Gargaar Freighters Limited had dealings with Kemcore Botswana prior to Ms. Bah's email to them, as evidenced by the Payment Transaction Report exhibited at pages 4 - 8 of the Defendant's Bundle of Documents. 4.42 According to DW, Kemcore Zambia Limited and Kemcore Botswana (Pty) Limited, both belong to the Kemcore Group of Companies but they exist as separate entities from each other and as such, are individually liable for their own obligations. 4.43 Further, that in a WhatsApp message sent to Gargaar Freighters Limited, Kemcore Zambia did not state that it was making payment, rather, Kemcore Zambia was merely enquiring in good faith if they were 'OK' with being paid in Kwacha instead of United States Dollar. J21 4.44 In cross-examination, DW admitted that at page 1 of the Defendant's Bundle of Documents is a Service Order Agreement which is a standard Kemcore Service Order Agreement and that this particular one was between Kemcore Zambia Limited and Gargaar Freighters Limited. 4.45 DW admitted that Kemcore Botswana was not party to the Agreement. Further, that there was no agreement between Gargaar Freighters Limited and Kemcore Botswana before the Court. 4 .46 DW further testified that he did not have any evidence in the form of delivery notes before Court to show that services were rendered to Kemcore Botswana. 4.47 According to DW, the total amount accrued to Gargaar for services rendered came to USDSS.373.00 at the end of February. DW further admitted that Ms. Bah's email did not mention anything to do with correction of the billing address on new invoices. He further admitted that the email was a directive from Fatu Bah to Gargaar Freighters Limited addressing the routes that Kemcore Zambia was to invoice on . J22 4.48 Under further cross-examination, DW admitted that Kemcore Zambia did not at any time suggest to Gargaar that Kemcore Botswana will take over liability for the payments. DW further admitted that Kemcore Zambia paid USD75,000.00 and that from the evidence on the record, it was clear that the person who wrote the WhatsApp message was aware that Kemcore Zambia Limited was making a payment of USD75,000.00 and the only enquiry was whether the amount could be paid in Kwacha. 4 .49 DW further conceded that there was no evidence before Court showing that the payment of USD75,000.00 was a mistake. However, he denied that as at May, 2024 when this matter was commenced, the total sum of money that was due to Gargaar Freighters Limited was USD290,299.54. 4.50 In further cross-examination, DW stated that the Defendant would not be calling any witness from Botswana to speak to the issues relating to Kemcore Botswana. Further, that there is nothing before Court to J23 demonstrate that Kemcore Zambia disputed to Kemcore Botswana the claims that were before Court. 4.51 DW further conceded that there was no correspondence authored by Kemcore Botswana before Court to suggest that there was a relationship between Gargaar Freighters Limited and Kemcore Botswana (Pty) Limited. 4.52 In further cross-examination, DW admitted that the email by Fatu Bah was speaking to the routes and invoices and not to the contractual parties. Further, that because of the email, the transporters would sometimes 1nv01ce Kemcore Botswana and sometimes Kemcore Zambia, depending on the routes on which the trucks were moving. She, however, said that she would fault the transporters or Plaintiff for issuing invoices in favour of Kemcore Botswana or Kemcore Zambia. She admitted that Fatu Bah gave them instructions on how to invoice but believed that they should have followed their contract. 4.53 In re-examination DW reiterated that there was no evidence before Court from Kemcore Botswana by way of delivery notes. It was her further evidence that in her J24 email, Fatu Bah was trying to put across the fact that all loads that belonged to Kemcore Zambia should be invoiced to Kemcore Zambia and loads that belonged to Kemcore Botswana should be invoiced to Kemcore Botswana because Kemcore Zambia could not receive invoices for which it did not receive any benefits and which did not belong to it. 4.54 DW clarified that what she meant in cross-examination by stating that there was evidence of communication from Kemcore Botswana, were the Payment Transaction Reports at pages 4 - 8 of the Defendant's Bundle of Documents. 4.55 DW further clarified that the Defendant did not ask for a repayment from the USD75,000.00 paid to the Plaintiff because Kem core Zambia and Kem core Botswana belong to a group of companies. That, Kemcore Zambia overpaid by USD16 ,000.00 but could not request for the money from Kemcore Botswana because it was sure that it would be treated as an inter-company payment. J25 4.56 DW reiterated that she did not have anything in writing from Kemcore Botswana to show the relationship with Kemcore Zambia. 4.57 That marked the end of the re-examination and the close of the Defendant's case. 5. Findings of Fact Undisputed Findings of Fact 5.1 The Plaintiff and Defendant entered into a Service Order Agreement whereby the Plaintiff agreed to provide road carrier transportation services to the Defendant. 5.2 The Plaintiff rendered services to the Defendant and some invoices were made out to the Defendant while other invoices were rendered to the Botswana entity, Kemcore Botswana (Pty) Limited. Disputed Findings of Fact 5.3 Whether the Plaintiff had a business relationship with Kemcore Botswana (Pty) Limited and who should be liable for payment for the services that were invoiced to them. J26 5.4 Whether the Defendant's internal email correspondence had any bearing on the Defendant's contract with the Plaintiff. 6. Issues for Determination Having carefully examined the pleadings and documents filed by the Plaintiff and Defendant in support of and defence of their respective cases, and identified the undisputed and disputed facts herein , the issues for determination, as I perceive them, are the following: (1) What is the effect of the Defendant's internal email correspondence on the Service Order Agreement? (2) Who is responsible for settlement of the invoices amounting to USD290,299.54? (3) Is the Defendant in breach of contract and liable for damages? 7. Legal Arguments Both the Plaintiff and Defendant submitted written submissions for which I am indebted. I have considered them in arriving at my decision in this Judgment. J27 8. Analysis and Court's Determination What 1s correspondence on the Service Order Agreement? the Defendant's the effect of internal email 8.1 Both the Plaintiff and Defendant agree that there was a Service Order Agreement between the parties for the transportation of sulphuric acid from Zambia to the Democratic Republic of Congo, which appears on pages 1 to 3 of the Defendant's Bundle of Documents. 8 .2 In the seminal decision of Printing & Numerical Registering Co. v. Sampson 1 , an English Court held as follows: "If there is one thing which more than another, public policy requires, it is that men of full age and competent understanding shall have the utmost liberty of contracting, and that their contracts when entered into freely and voluntarily shall be held sacred and shall be enforced by courts of justice." 8.3 The holding above underscores a fundamental principle of contract law that parties who freely and voluntarily enter into a contract are bound by the terms they agreed to. 8.4 Where a contract is presented before the Court for interpretation in the event of a dispute between parties, it is the role of the Court to merely give effect to its J28 prov1s10ns. In Trollop and Colls Limited v. Northwest Metropolitan Regional Hospital Board, 2 the court held that:- "The Court w ill not even improve the contract which the parties have made for themselves, howe ver desirable the improvement might be." 8.5 The holding above emphasises the point of law that the role of the Court is to merely interpret what the parties have expressed in their agreement and not improve or alter the intention of the parties. The Supreme Court in African Banking Corporation (Z) Limited (t/ a Bank ABC) v. Plinth Technical Works Limited3 held that: "It is trite that the interpretation of a written document is a matter of law for the court. The function of the court is to ascertain what the parties meant by the words which they have used; to declare the meaning of what is written in the instrument, not of what was intended to have been written; and to give effect to the intention as expressed. The object is to discover the real intention of the parties and the intention must be gathered from the written instrument read in the light of such extrinsic evidence as is admissible for the purpose of construction. It is not permissible to guess at the intention of the parties and substitute the presumed for the expressed intention. " (Emphasis, the Court's) 8.6 It is thus, clear that the role of the Court is to give effect to the intention of the parties by interpreting the wording of the contract. It is not allowed for the Court to presume or substitute the expressed intention of the parties. J29 8.7 Having established that there was an agreement between the Plaintiff and Defendant, the fundamental issue that has to be resolved by this Court is the effect of the email correspondence appearing at page 19 of the Plaintiff's Bundle of Documents which expressly states as follows: "Note: address to invoice to: - All Loads from Kansanshi going to KCC must be invoiced under the below address KEMCORE ZAMBIA, 3797, ZAMBIA ROAD, HEAVY INDUSTRIAL AREA, NDOLA, ZAMBIA - All loads from Namibia and Kansanshi going to Metalkol, the below Chemaf, Golden Africa must be invoiced address. to KEMCORE BOTSWANA (PTY) LTD PLOT 152GICP GABERONE, BOTSWANA" 8.8 The above correspondence 1s unambiguous in that it clearly stated that some invoices for services were to be made to the Defendant in Zambia and some to the Botswana entity. 8.9 The Defendant however argues that the email was an internal memorandum between the Defendant's employees and could not be relied upon by the Plaintiff, J30 especially as it constitutes extrinsic evidence that did not form part of the con tract. 8.10 I opine that this is a flawed argument on the part of the Defendant for the following reason. Extrinsic evidence is permitted to vary or interpret the terms of the agreement where it is shown that the written agreement is not the whole agreement. In Holmes Limited v. Buildwell Construction Company Ltd4 the Court held that: " .. Extrinsic evidence maybe admitted to show that the instrument was not intended to express the whole agreement between the parties. (Chitty on Contract 23rd Edition, Vol. I, para. 620.) In the case of Mercantile Bank of Sydney v Taylor fl} their Lordships stated at page 321: 'It had been proved that the whole terms of the agreement under which Griffin became entitled to his release were embodied in the bank's letter of the 5th April, 1889, which that he accepted without reservation or qualification. On assumption, it is plain that the previous verbal communications which had passed between him and the bank were completely superseded, and could not be legitimately referred to, either for the purpose of adding a term to their written agreement, or of the altering Court's) legal ordinary construction.' (Emphasis, its 8.11 Based on the above persuasive authority, unofficial directions such as those issued by the Defendant appearing at page 19 of the Plain tiff's Bundle of Documents could be used to interpret the contract, particularly on the mode of payment for services rendered. .. J31 8.12 I should also point out that even if the email correspondence was an internal document, it came to the Plaintiff's attention in one way or the other. This is evidenced by the fact that before the email correspondence, the Plaintiff was 1nv01c1ng the Defendant but after the email, the Plaintiff started invoicing the Botswana entity. Therefore, the Plaintiff was affected by the email that clearly stated that invoices were to be made to Kemcore Botswana (Pty) Limited. Thus, the Plaintiff cannot be blamed for issuing invoices for services in that manner. Who is responsible for settlement of the invoices amounting to USD290,299.54? 8.13 Apart from looking at the plain and ordinary meaning of the words of the contract, another rule of contract is the use of background information. According to the learned authors Sangwani Patrick Ng'ambi and Chanda Chungu, in their book, Contract Law in Zambia, 2 n d Edition, at pages 117 to 118 state that: "Thus, the courts have moved away from the literal approach towards a purposive approach of interpretation, with particular emphasis being laid upon the adoption of an interpretation which has regard to the commercial purpose of the transaction." • J32 8.14 The above highlights the fact that the purposive approach and background information can be utilised when interpreting the contract. Under Clause 4 of the Agreement between the parties herein on payment terms, it states that "100% of the sum due will be paid 15 days after "Kemcore" received PODs/invoice." 8. 15 I am of the view that the use of the word "Kem core" as opposed to "Kemcore Zambia" which is used throughout the other part of the Agreement, envisages a situation that other entities of Kemcore, a company that operates throughout Southern Africa (as acknowledged on page 1 of the Agreement), could be made to pay for sums due under the Agreement. 8.16 However, it is not in dispute that the Plaintiff provided services, save for the fact that invoices were issued to Kemcore Botswana (Pty) Limited following the email instruction from the Defendant dated 23 rd November, 2022, to issue invoices in the names of the Defendant and Kemcore Botswana (Pty) Limited. 8.17 The Defendant through DW admitted during trial that the Plaintiff did not have any relationship with the J33 Botswana entity. In addition, there was no real dispute that the Plaintiff rendered the services which the Botswana entity was invoiced for. 8.18 The Defendant claims that it is not liable to the Plaintiff for sums invoiced to Kemcore Botswana (Pty) Limited. That, the Defendant and Kemcore Botswana (Pty) Limited are two separate entities by law and the Defendant cannot be liable for sums that were claimed from Kemcore Botswana (Pty) Limited. 8.19 In the absence of a business connection between the Plaintiff and Kemcore Botswana (Pty) Limited as admitted by the DW, and the fact that services were rendered by the Plaintiff, which was not disputed, I come to the inescapable conclusion that the Defendant is liable for the services rendered. 8.20 A party cannot be permitted to receive services on a gratuitous basis, unless expressly agreed by the parties. In the circumstances, the Plaintiff having rendered services, should be paid for the same. The Defendant's attempt to avoid payment would amount to unjust enrichment of the Defendant . • J34 8.2 1 Therefore, even if the Defendant denies liability because the invoices were made to a different entity, the fact that it received services means that it be would liable under the quantum meruit rule which provides for reasonable remuneration for services rendered. It would be unjust for the Defendant that received services not to pay for them due to a technicality which they caused due to the email correspondence that was genuinely relied upon by the Plain tiff. 8.22 Given that the contract was between the Plaintiff and the Defendant and not between the Plaintiff and Kemcore Botswana (Pty) Limited, the Plaintiff was correct in claiming the sum of USD290,299.54 from the Defendant for the services rendered. 8 .23 In light of the foregoing , the Plaintiff succeeds with its claim for USD290,299.54 for the transportation services under the Service Order Agreement. Is the Defendant in breach of contract and liable for damages? 8.24 According to Ng'ambi and Chungu referred to above, breach of contract occurs: "when a party to the said contract fails to perform an obligation of the contract as required by its terms. " • J35 8.25 The Court of Appeal in Rapid Global Freight Limited v. Zambia Railways Limited, 5 held that: "Therefore, upon failure to perform the contract the respondent was entitled to cancel the contract. It is trite that a breach of contract occurs when a contracting party (the defaulting party) fails to perform, without lawful excuse a contractual obligation or term of contract, whether by late performance or defective performance etc .. " 8.26 The failure to perform any primary express or implied obligation of the contract amounts to breach of contract. Put differently, breach of contract occurs where a party, without lawful cause, fails, refuses or neglects to perform his obligations under the contract, provides defective performance or disables himself from performing his part of the contact. 8.27 In the circumstances, it is clear that the Defendant breached the contract by failing to pay for services it received from the Plaintiff. 8.28 However, the question that now anses 1s whether the Plaintiff can succeed with a claim for breach of contract or indeed, loss of business. In the circumstances, the Plaintiff has not led any-evidence to prove its loss that requires compensation by damages. .. J36 8.29 Therefore, the damages that can be awarded in the circumstances are nominal. As noted by the Supreme Court in Finance Bank and Rajan Mahtani v. Simataa Simataa6 , referring to the case of Mappouras v. Waldrons, 7 "Nominal damages are 'not intended to compensate for anything at all ', but are awarded simply to 'mark the fact that there has been a breach of contract. .. " 8.30 In the circumstances, having proven breach but not the nature and scope of any loss, I award the Plaintiff the sum of Kl,000.00 as nominal damages. 9. Conclusion and Orders. 9 . 1 In conclusion, the Plaintiff has succeeded in its claim for USD290 ,299.54 being the sum due for transportation services. 9 .2 The Plaintiff has also succeeded in its claim for breach of agreement and loss of business and is hereby awarded Kl ,000 as nominal damages. 9.3 The Dollar sum due shall carry interest at the London Interbank Offered Rate (LIBOR) from the date of the Writ of Summons to date of payment. ... J37 9.4 The nominal damages of Kl ,000.00 shall attract interest at short term deposit rate from the date of the Writ of Summons to the date of Judgment and thereafter, at current lending rate as determined by the Bank of Zambia until full payment. 9.5 Costs are awarded to the Plaintiff, to be taxed in default of agreement. Dated at Ndola this 9 th day of December, 2024. ~ Winnie Sithole Mwenda (Dr.) J\JDICIARy HIGH COURT • I -9 DEC 2024 I