Interland Marketing Limited v Roy Kwaleyela Maswenyeho and Anor (APPEAL NO. 178 OF 2020) [2022] ZMCA 201 (1 June 2022)

.. IN THE COURT OF APPEAL OF ZAMBIA APPEAL NO. 178 OF 2020 HOLDEN AT LUSAKA (Civil Jurisdiction) BETWEEN: INTERLAND MARKETING AND t.?l.lllLIC CF lAM -~ j~; r l_ - ;' I/ c_::===' ELLANT ROY KWALEYELA MASWENYEHO 1 ST RESPONDENT NATIONAL HOUSING AUTHORITY 2ND RESPONDENT CORAM: Chashi, Ngulube and Sharpe-Phiri, JJA ON: 19th April and 1st June 2022 For the Appellant: G. Haakainsi, Messrs LM Chambers For the 1st Respondent: (1) P. G Katupisha, Messrs Milner and Paul Legal Practitioners (2) C. Sianondo, Messrs Malambo and Company For the 2nd Respondent: N/ A JUDGMENT CHASHI JA, delivered the Judgment of the Court. Cases referred to: 1. Folayinka F. O Esan v The Attorney General - SCZ Judgment No. 47 of 2016 2. Admark Limited v Zambia Revenue Authority (2006) Z. R 43 -J 2- 3. Peter Militis v Wilson Kafuko Chiwala-SCZ Judgment No. 3 of2009 4. Kajimanga v Chilemya-SCZ Appeal No. 50 of 2014 (2016) ZMSC 189 5. Valentine Webster Chansa Kayope v The Attorney General (2011) ZR, 424 6. Ardy Mnajaidi v Molly Pelekamoyo-CAZ Appeal No. 29 of Legislation referred to: 1. Black's Law Dictionary, 9 th Edition 2 . Halsbury's Law England, Volume 27, 4 th Edition 3. Wikipedia - en.m.wikipedia.org 1.0 INTRODUCTION 1.1 This appeal emanates from the Judgment of Honourable Mr Justice M. M Kondolo, High Court Judge as he then was, which was delivered on 6 th January 2020. 1.2 In the said Judgment, the learned Judge granted the 1st Respondent, who was the Plaintiff in the court below, the remedies of specific performance, possession and mesne profits against the Appellant. 2.0 BACKGROUND -J 3- 2 . 1 The 2 nd Respondent owned shops in Kabwata. The shop in issue was initially offered to the Appellant to buy, who was the sitting tenant, on 10th May 1996. Despite several extensions as regards payment of the purchase price, the Appellant failed to pay. Subsequently, the shop was offered to the 1st Respondent, a former employee, who paid for the shop by way of deductions from his retirement package. 2.2 The Appellant refused to vacate the shop, despite notices for termination of tenancy agreement and the court's refusal to renew the tenancy agreement. That prompted the 1st Respondent to commence proceedings in the court below by way of writ of summons, claiming the following reliefs: (i) Specific performance of the agreement (ii) Damages for breach of agreement (iii) An Order for the Appellant to vacate the premises -J 4- (iv) A declaration that, he was entitled to be paid rent arrears by the Appellant from the date of the purchase to the date of vacant possession. (v) Interest 2.3 The Appellant settled its defence, denying the averments in the 1st Respondent's statement of claim and counter claimed inter alia, the following reliefs: (i) An Order to nullify the sale of the shop to the 1st Respondent on account of fraud and abuse of office (ii) An Order that the Appellant pays for the shop which it was still occupying. 3.0 DECISION OF THE COURT BELOW 3 .1 After considering the evidence and the arguments, the learned Judge dismissed the Appellants counter claim and granted the 1st Respondent the following reliefs: ( i) Specific performance of the sale of the shop (ii) The Appellant to vacate the premises within 30 days from the date of the Judgment -J 5- (iii) The Appellant to pay mesne profits from 1st February 1998 till payment, same to be assessed by the District Registrar (iv) All amounts to attract interest at the average short term deposit rate per annum prevailing from the date of writ to Judgment and thereafter at the current lending rate as determined by the Bank of Zambia until payment. 4.0 THE APPEAL 4 .1 Dissatisfied wit h the Judgm en t , the Appellant h as a ppealed to this Court, a dvancing the following three grounds: (i) The court below erred in law and fact when it awarded mesne profits to the Respondent contrary to what was pleaded and the reliefs endorsed on the claims by the plaintiff. Or alternatively that the court erred in law and fact when it awarded mesne profits to the 1st Respondent against the Appellant when Landlord and Tenant relationship never existed -J 6- between the two and when the title was still in the name of the 2 nd Respondent and no actual handover of the property to the 1st Respondent was done by the 2 nd Respondent (ii) The court below erred in law when it awarded the Respondent mesne profits from 1st February 1998 until date of payment when at the same time it ordered handover of the property within 30 days from the date of Judgment as there is no guarantee that the two events will happen on the same date (iii) The Learned trial Judge erred in law and fact when he held that the offer to the Appellant had lapsed before the offer to the 1st Respondent when the transaction between the two had gone beyond offer and acceptance to the stage of consideration and time was not of essence in the transaction. 5.0 ARGUMENTS IN SUPPORT OF THE APPEAL 5.1 Mr. Haakain s i, Counsel for th e App ellant, a t the h earing relied on the Appellant's h eads of argument which wer e -J 7- filed into court on 1st October 2020. We note at page 6 of the arguments, that this is what was submitted, by the Appellant: "My Lords and Ladies, the parties have agreed not to prosecute ground 3 as the same will be settled ex curia by consent" 5.2 In view of the aforestated, we will therefore not address the third ground. It will also be noted that it was on that basis that the 1s t Respondent did not argue the third ground. 5.3 In arguing the first ground, Counsel submitted that throughout the proceedings, the 1s t Respondent never pleaded for mesne profits against the Appellant. According to Counsel, the court below only moved on its own, to award the relief which was not pleaded and that therefore this was a misdirection. We were referred to Order 18 / 8 RSC which provides that: "(1) A party must in any pleading s ubsequent to a stat ement of claim plead specifically any matter, for example performance, release, the expiry of any relevant period of -J 8- limitation, fraud or any fact showing illegality .. . (c) Which raises issues of fact not arising out of the proceedings pleading. " 5.4 Our attention was drawn to the cases of Folayinka F. O Esan v The Attorney Ge neral 1 and Admark Limited v Zambia Revenue Authority2 on the purpose and function of pleadings and submitted that the law is very clear that the court is guided by the pleadings and that the court cannot grant a relief which has n ot been pleaded by the parties. 5.5 In the alternative, it was argued that the Appellant was never a tenant to the 1st Respondent and the evidence shows that there was no actual handover of the property from the 2 n d to the 1st Respondent. It was su bmitted that it is trite law th at in Order to sustain a claim for mesne profits, there must first have existed a landlord and tenant relationship, wh ich relationship came to an end bu t th e tenant continued to be in occupation of the property despite the expiry of the legal right to occupy the premises; -J 9- thereby depriving the landlord of the benefit he could have received if he was in possession or occupation 5.6 It was Counsel's contention that mesne profits should not b e awarded where there is no landlord and tenant relationship. Our attention was drawn to the case of Peter Militis v Wilson Kafuko Chiwala3 where the Supreme Court had this to say: "What is mesne profits and when are they due? In Halsbury's Laws of England, Vol 28, 3 rd Edition at page 561, paragraph 1230, the legal position is that the landlord may recover in an action for mesne profits, damages which he has suffered through being out of possession of the land. Mesne profits being, damages for trespass, can only be claimed from the date when the defendant ceased to hold the premises as a tenant and became a trespasser ... " 5. 7 It was Counsel's submission that from the aforestated authority, it is clear that the award of mesne profits against the Appellant was a misdirection. -J 10- 5.8 We note that the second grou nd of appeal was not argued. We will however address this issu e in due course, as we have noted that the 1st Respondent responded to the same. 6.0 18 T RESPONDENTS ARGUMENTS 6.1 In response to the first gr ound, Mr Katupish a and Mr Sianondo, Counsel for th e 1st Respondent relied on th e heads of argument filed into Court on 19th April 2022. Counsel drew our atten tion to the learned au thors of Black's Law Dictionary1 at page 1329 where mesne profits is defined as: "The profits of an estate received by a tenant in wrongful possession between two dates, medium tempus (inter mediate period)" 6.2 According to counsel, Mesne profits are also defined as: "Damages payable to a landlord for losses incurred because his tenant stayed in possession of the property after the tenancy came to an end." Cou nsel referred us to the case of Kajimanga v Chilemya4 where the Supreme Court cited Halsbury's Law England2 on when a landlord may recover mesne profits and -J 11- submitted that the learned Judge in the court below cannot be faulted for ordering mesne profits as damages to be paid by the Appellant to the 1st Respondent who had lost its legal and equitable right to be in occupation of the premises after termination of the tenancy between the Appellant and the 2 nd Respondent on 31 st January 1998 6.3 As regards the reliefs endorsed on the statement of claim, it was contended that the same must be read in their entirety. That the reliefs were inter alia "(ii) damages for breach of agreement (iv) further or other relief the court shall deem fit." It was submitted that the court deemed it fit to order payment of mesne profits as damages for wrongful occupation as the Appellant had no legal or equitable right to continue in occupation from 1s t February 1998. 6.4 It was further submitted that based on Peter Militis's case the appellant was actually a trespasser and there ought not be any landlord and tenant relationship with the 1st Respondent for mesne profits to be justified. That the issue of the title being in the name of the 2 nd Respondent is immaterial because the 1s t Respondent having paid the -J 12- full purchase price acquired proprietary rights in the shop and was entitled to all the benefits therefrom. 6 .5 Although the Appellant did not argue the second ground of appeal, the 1st Respondent responded to the same. It was submitted that mesne profits have to be paid for the period of wrongful occupation or for a period of occupation where rent payable was not paid. That this position was confirmed in the case of Valentine Webster Chansa Kayope v The Attorney General5 . 6.6 According to Counsel, the Appellant never paid rent either to the 1st Respondent or to the 2 nd Respondent from the time the 1st Respondent purchased the property and as correctly stated by the learned Judge in the court below, from 1st February 1998. It was contended that it is in that period that the Appellant must pay mesne profits to the 1s t Respondent. 7.0 OUR ANALYSIS AND DECISION 7.1 We have considered the arguments and the Judgment being impugned. The first ground attacks the learned Judge for awarding mesne profits to the 1st Respondent when as according to the Appellant it was neither pleaded -J 13 - nor claimed. In the alternative, the Appellant has argued that mesne profits shou ld not have been awarded as there was no landlord and tenant relationship between the Appellant and the 1s t Respondent. 7.2 Mesne profits are defined by Wikipedia as "Sums of money paid for the occupation of land to a person with right of immediate occupation, where no permission has been given for that occupation." The object is to compensate the person who has been kept out of possession and deprived of enjoyment of his property. 7.3 We note from the endorsement on the statement of claim that, the 1st Respondent was inter alia claiming the following reliefs: (i) An Order for the Appellant to vacate the premises (ii) A declaration that, he was entitled to be paid rent arrears by the Appellant from the date of purchase to the date of vacant possession. 7.4 Mesne profits is a form of damages or compensation. It does not have to be specifically en dorsed, stated or claimed as mesne pr ofits. It can be inferred from the endorsement. -J 14- • In the view we have taken, the aforestated endorsements qualified for a claim of mesne profits. 7. 5 As regards the alternative argument by the Appellant, we agree that there was no landlord and tenant relationship between the Appellant and the 1st Respondent. In the case of Ardy Mnjaidi v Molly Pelekamoyo6 we found that there was no landlord and tenant relationship and that therefore, the Appellant was not entitled to mesne profits. We however, went on to grant the Appellant damages for breach of contract calculated on the same basis as mesne profits. 7.6 Equally in this matter, mesne profits should not have been awarded by the learned Judge in the court below. However, the 1st Respondent is entitled to damages. The 1st Respondent having bought the shop, was entitled to immediate possession which was impended by the Appellant who had unlawful possession of the shop, resulting in the 1st Respondent suffering damages for the delayed possession and loss of use of the shop. In the view that we have taken, we accordingly set aside the award of mesne profits and substitute it with damages for loss of • use of the shop for having kept the 1st Respondent out of -J 15- possession and depriving him of immediate enjoyment of the shop. The damages are to be calculated on the same basis as mesne profits. The issues of change of title and actual handover of the shop 1n our view are inconsequential. What is of prime importance is that the Appellant was in unlawful possession as the 1st Respondent had acquired an immediate right and interest in the shop. 7.7 As earlier alluded to , the second ground was not argued by the Appellant. However, the 1st Respondent having responded, and seeing that there is an issue which needs to be clarified, we are bound to address the second ground. This ground is faulting the learned Judge for awarding mesne profits from 1st February 1998 until date of payment, when at the same time, he ordered handover of the shop within thirty days from the date of Judgment, as there is no guarantee that the two events will happen on the same date. 7.8 We note the absurdity which has been disclosed by the Appellant. For clarity, we accordingly set aside the Order • • -J 16- of the court below and Order that the damages will be from 1st February 1998 to the date of vacation. However, interest will keep accruing up to the time of full payment. 8.0 CONCLUSION 8 .1 This appeal h as substantially failed, save for th e setting aside and substitutions. We will therefore award costs here and in the court below to the 1st Respondent, to be paid forthwith . Same are t e taxed in default of agreement. J . CHAS COURT OF APPEAL JUDGE ~ P. C. M. NGULUBE COURT OF APPEAL JUDGE ~ARPE -PJ ' i i i COURT OF APPEAL JUDGE