Zambia National Commercial Bank v Sandy Sindazi (T / A Sansin Business Solutions) (Appeal No. 70/2024) [2025] ZMCA 32 (24 February 2025)

IN THE COURT OF AP HOLDEN AT NDOLA (Civil Jurisdiction) BETWEEN AND 2 4 FEB 2025 REGISTRY 2 Appeal No . 70/2024 APPELLANT SANDY SINDAZI (T / A SANSIN BUSINESS SOLUTIONS) RESPONDENT CORAM: Siavwa pa JP, Chishimba and Patel, JJA On 18t h and 24t h February 2025 For the Appellant: Mrs S . N Wamulume from Messrs Ndemanga Mwalula a nd Associates For the Respondent: Mr. K. Mwale of Messrs. K Mwale and Company JUDGMENT CHISHIMBA JA, delivered the Judgment of the Court. CASES REFERRED TO: 1. JZ Car Hire Limited and Malvin Chala, Scirocco Enterp r ise s Li m ited SCZ Judgment No. 26 of 2022 2 . Attorney General v D. G Mpundu ( 1984) ZLR 6 (SC) 3 . Andrew Tony Mutale v Crushed Stone Sales Li mited (1994) SCZ No. 17 of 1994 4. Bonham Carter v Hyde Park Hotel (1948) 64 TLR 177 5. Ashcroft v Curtin (1971) 3 ALL ER 1208 J2 6. Holmes Limited v Buildwell Construction Limited (1973) ZR 97. 7 . Colgate Palmolive (Z) Inc v Able Shemu and 110 Others SCZ Appeal No. 181 of 2005 8. Gold Group Properties Limited v BDW Trading Limited (2010) EWHC 9 . The Attorney General v Marcus Kampumba Achiume (1983) ZR 1 10. Anna Anthony Mross v BHM Enterprises Limited CAZ Appeal No. 58 of2023 11. African Banking Corporation (Z) Limited v Plinth Technical Works Limited & Others (SCZ 8 128 of 2015) [2015] ZMSC 42 12. Kalusha Bwalya v Chadore Properties Kalusha Bwalya v Chadore Properties and Ian Chamunora Nyalungwe Haruperi - SCZ Appeal No. 222/2013 13. Wilson Masauso Zulu v Avondale Housing Project Limited (1982) Z. R . OTHER WORKS REFERRED TO 1. A Treatise on the Law of Evidence, Volume 1 2. Black's Law Dictionary 3. Halsbury's Laws of England 4 th Edition 4 . Trietel Law of Contract 4 th Edition 1.0 INTRODUCTION 1.1 This is an appeal against the judgment of Judge E. L Musona, awarding the respondent damages for breach of contract and loss of business. 2 .0 BACKGROUND 2 .1 The respondent, who was the plaintiff in the Court below, commenced an action against the appellant seeking the following reliefs: i) Damages for breach of contr act; J3 ii) Damages for loss of business; iii) Payment of the outstanding balance from the 2019/2020 contract of K495,000.00; Payment of 10% commission of K49 ,500.00 Costs; and iv) v) vi) Any other relief that the court may deem fit. 2 .2 The respondent averred that the parties entered into a contract for the provision of outsourcing of model digital sales agents and to recruit 104 youths as Digital Sales Agents (DSAs) in the Southern and Western Provinces. Each DSA was to open a minimum of 52 Xapit accounts per month. The set target of accounts to be opened for the duration of the contract was 65,720. The respondent pleads that 104 DSAs were employed, with 17 deployed to Western Province and 87 deployed to Southern Province. 2 .3 Thereafter, the respondent began to encounter challenges which were attributed to the appellant. The appellant was alleged to have breached the con tract on account of the following: failure to provide promotional materials necessary to open accounts, failure to configure devices to enable a ccess to the appellant's banking system, failure to provide internet J4 bundles to connect to the banking . system, failure to provide adequate starter packs to open accounts, failure to provide system reports which, when provided, were at variance with the figures in the system, failure to provide adequate banking facilities in the rural areas and the failure to provide a dedicated IT team to handle technical challenges. As a result, the number of accounts opened had significantly reduced. 2 .4 In or around December 2019, the appellant elected to in traduce more vendors in the two provinces, r~sulting in the respondent's bid to expand DSA services. According to the respondent, the appellant assured him of the continuity of the contract and sent new promotional materials in February 2020 as an indication of continuity. Based on the representation of continuity, the respondent continued to recruit DSAs. 2 .5 In the same month of February, the appellant terminated the agreement without notice. That prior to the termination , the appellant began blocking the phones and calling DSAs to s top work without the respondent's knowledge. As a result of the appellant's actions, the respondent averred that it suffered severe stress , embarrassment, loss of business and damages JS arising from breach of contract and the unlawful termination of the contract. 2 .6 The appellant filed a defence and counterclaim. In the defence, the appellant admits entering into a contract with the r espondent to outsource DSAs fo r one year. The contract commenced on 15th January 2019 with an expiry date of 13 th December 2019. By an addendum dated 23rd January 2020, the parties agreed to extend the contract by two months , thereby extending the contract to 29 th February 2020. 2. 7 The appellant, under the contract, d enied undertaking to provide the respondent with promotional materials to open accounts, to configure devices for access to the appellant's banking system, to provide internet bundles to connect to th e banking system, or to provide adequate starter packs to open accounts. Further, that it was not a term of the contract that it would provide system reports , adequate banking facilities in the rural areas and a dedicated IT team to handle any technical challenges. 2 .8 In the counterclaim, the appellant pleads that it was agreed that the appellant would provide the respondent with 104 Samsung J6 J4 mobile phones for use during the contract. At the end of th e contract, all the phones would be returned to the appellant in good condition. Failure to r eturn the phones in good condition would result in a liability of K2 ,337.99 for each phone. At the end of the contract, the respondent failed to return the 104 phones and the appellant suffered loss as a result. The appellant therefore claimed for payment of the sum of K243, 150. 96 being the value of the phones. 3.0 DECISION OF THE COURT BELOW 3 . 1 The learned Judge held that the contract between the parties subsisted for a full term and ended on 29th February 2020 b ecause of effluxion of time . Therefo re , there was no breach of contract regarding the contract coming to an end. However , the learned Judge found that the appellant failed to fulfil its contractual obligation thereby resulting in breach of contract. 3 .2 The Court held that the DSAs found it hard to meet the targets set by the appellant beca use the bank system was sometimes unavailable which resulted in customers failing to make deposits. The appellant's delay in submitting starter pack kits exacerbated the DSA's failure to meet their targets. J7 3 .3 Consequently, the Cou rt foun d merit in the respondent's claim for loss of business because the failure by the appellant negatively affected the pace at which the respondent would have worked . Commission was based on work done and the effect of the appellant's actions was that work slowed down. As a result, there was a loss of working time which translated into a loss of business. The other claims by th e respondent were dismissed. 3.4 With regard to the counterclaim , the Court held that the respondent had a duty to collect the mobile phones from the DSAs and return them to th e appellant in good condition at the end of the contract. The counterclaim for payment of K243 , 150. 19 therefore succeeded. 4 .0 GROUNDS OF APPEAL 4 . 1 Dissatisfied with the decision of the Court below, the appellant has appealed advancing four grounds cou ched as follows: i) The Court erred in law and in fact when it awarded the respondent damages for loss of business when the respondent did not plead any special damages and loss of profit; ii) That the learned Judge in the Court below erred in fact and law when he held that the digital sales agents failed to meet the targets set because the appellant's bank system was not J8 available without any evidence being led by the respondent that the bank system was unavailable; iii) That the learned Judge in the Court below erred in law and fact when he adjudged that the appellant had breached its contractual obligations with the respondent when the matters claimed were not part of the digital sales contract between the parties; and iv) That the learned judge in the Court below erred in law and fact when he held that the appellant had blocked the respondent's devices when the devices were only deactivated at the end of the contract. 5.0 APPELLANT'S HEADS OF ARGUMENT 5 .1 The appellant filed head s of argument dated 18th March 2024. In ground one, the appellant challenges the lower Court's decision to award the respondent damages for loss of business. Cou nsel argued that the Court's finding that the respondent's loss of working time translated into the loss of business was not supported by facts on record or the law. It was contended that the Court used "discernment" and not facts to arrive at the above finding. The appellant suffered no actual loss. The case of JZ Car Hire Limited and Malvin Chala, Scirocco Enterprises Limited(1l was cited on the need to prove damages. J9 5.2 Learned counsel argued that special damages such as loss of busin ess ought to be specifically pleaded as h eld in the cases of Attorney General v D. G Mpundu12l and Andrew Tony Mutale v Crushed Stone Sales Limited(3 l. It was submitted th at n ot only did the respondent fail to plead special damages , but it also did not provide any evidence pointing to loss of business. As authority, the case of Bonham Carter v Hyde Park Hotel14l and A Treatise on the Law of Evidence, Volume 1 was drawn to our attention on proof of damages and the burden on the party substantially asserting the affirmative of the issue lying in casu on the respondent. 5.3 Counsel argued that the respondent should have produced account statements before and after the alleged breach of contract to demonstrate th e loss suffered. We were referred to the English case of Ashcroft v Curtin15l, where the Court r efused to award damages b ecause there was no evidence by the claimant to help quantify the loss suffered. Counsel submits that the failure to prove d amages is fatal, therefore , the appellate Court should set aside the award for damages for lack of evidence. 5 .4 Under ground two , it is argued that the Court erred when it h eld ' JlO that the DSAs failed to meet the targets set because the banking system was unavailable. The assertion that the DSAs could not work because of the appellant 's banking system was an afterthought. The pleadings did not refer to or attribute any loss I or challenges to the appellant's banking system. The only evidence alleging that the banking system would sometimes b e unavailable was that of PW2. It was also contended that there was no evidence showing that the DSAs could not meet their targets due to system failure or the mode of account opening adopted by the appellant. That, therefore it was incomprehensible how the Court concluded that the bank system was unavailable , resulting in the respondent failing to meet its targets. 5 .5 On the contrary, the position of the appellant is that the respondent was to blame for failing to meet its targets. Evidence at trial revealed that the respondent was a poor manager who failed to manage his staff and ensure that the targets were met. The respondent could not retain the DSAs because he failed to pay them their commission as eviden.ced by an email dated 30th Jll April 2019 , at page 86 of the record of appeal. Though the respondent was contracted to employ 104 DSAs, only 34 DSAs , as of 17th September 20 19, were employed nine months into the contract. 5 .6 In a ddition, counsel submitted that before the contract expired, the respondent had not visited the Western and Southern provinces where the DSAs were based and as a result, the DSAs lacked motivation. The respondent only undertook to visit Western and Southern provinces in March 2020 after the expiration of the contract. Therefore, the low targets were as a result of the respondent's performance and not the lack of starter packs or system challenges. 5 7 The thrust of the appellant's arguments in ground three, is that the Court below erred by finding that the appellant breached it s contractual duties when the breach complained of was not part of the agreed contractual obligations between the parties. Learned counsel referred to the definition of breach of contract by Black's Law Dictionary as the violation of a contractual obligation by failing to perform one's own promise, by repudiating it, or by interfering with another party's performance . Further, in "an action for breach of contract, the cause of a ction is the breach," as per the learned authors of Halsbury's Laws of England 4 th Edit ion . The contention is that there can be no breach if what is a leged to be breached d oes not form part of the contract. 5 .8 Learn ed counsel submitted that under the agreement, the appellant did not agr ee to supply the respondent with promotional m aterials, internet bundles, adequate starter packs, a dedicated information technology team, system reports, banking facilities , or to configure devices to enable access to the appellant's system . 5.9 It is the argument that promotional materials were not required to open accounts. The same were for branding during marketin g events and were not provided as a matter of right. With regard to internet bundles, it was argued , s imilarly , th a t the same was not r equired to open accounts . The phones provided t o DSAs h a d a feature configured by MTN that enabled the mo bile phones to access the banking system without accessing the intern et. Counsel explained that th e starter packs referred to comprised an ATM card and account number. An account could J13 still be opened without an ATM card. Such an account was called a cardless account. The respondent had, on several occasions, successfully opened cardless accounts and received commission for the same. 5.10 On the failure to provide a technical support team, counsel reiterated that this was not a term of the agreement between the parties. At trial, the respondent showed that there was a WhatsApp group comprising the DSAs and the appellant's members of staff to resolve any technical issues. The evidence of DWl was that the respondent had access to her and that DW2 would walk to the appellant's building if h e faced any challenges. Concerning the failure to configure devices , counsel submitted that the phones were linked to the appellant's information technology system. Once connected, the device could then be used to open accounts. Without configuration, it would be impossible to open an account. Referen ce was made to page 97 of the r ecord of appeal, to show that in all the working months , the respondent managed to open accounts. The evidence of DW 1 was that some DSAs failed to operate the phones, and this was not because they were not configured. J14 5. 11 Counsel was at a loss as to how the failure to have adequate banking facilities in rural areas could constitute a breach. Evidence at trial r evealed that the appellant had branches and Xpress Agents in Mazabuka, Monze, Choma, MaaJilba, Namwala, Livingstone, Kazungula and Mongu. That the respondent did not know these alternative branches because he never visited the Western and Southern regions assigned to him. 5.12 In respect of the failure to provide system r eports , the appellant explained that the system reports showed how many accounts the DSAs opened to compute the commission payable. At trial, the evidence of PW 1 indica ted that there were differe nces between the respondent's manual r eports and the system r eports due to DSAs inflating the number of accounts opened. The provision of system r eports was not a term of the contract. 5. 13 The a ppellant's contention is that none of the items listed as constituting breach was part of the contract. The respond~nt produced and relied on the Terms of Reference (TORs) in a bid to show that the appellant h ad agr eed to provide the saJile under the contract. Counsel further argued that the TORs were not JlS incorporated into the final contract and were merely used for negotiations. Reliance on the TORs would amount to extrinsic evidence which is inadmissible as held in Holmes Limited v Buildwell Construction Limited(6 l. 5.14 The position of the appellant is that the respondent executed the contract being fully aware of it s terms. Therefore, the respondent is bound by the terms of the contract it voluntarily entered into. The case of Colgate Palmolive (Z) Inc v Able Shemu and 110 Others(7l was cited as authority to argue t h at Courts should enforce contr acts th at parties h ave freely entered. 5.15 In instances where a contract ceases to b e commercially viable after the parties h ave executed it, the parties r emain bound by it. To p er suade us on this argument, reference was m ade to the English case of Gold Group Properties Limited v BDW Trading Limited(8l . 5 . 16 Counsel contended that the Court below, in essence, re -wrote the contract between the p a rties, thereby, imposing contractual duties on the appellant. Learned counsel quoted a passage from the learned authors of Trietel Law of Contract 4 t h Edition J16 Para 3-013 where the authors opined that Courts should not interfere with the bargain actually made by parties. 5 17 We were urged to reverse the finding of fact that the appellant breached the contract. We were referred to the case of The Attorney General v Marcus Kampumba Achiume(9 1 where the court highlighted instances when an appellate court could reverse findings of fact. 5 . 18 In arguing ground four, it was submitted that there was no evidence to substantiate the respondent's claim that the appellant blocked the respondent's d evices. Though the Court below held that the appellant blocked the DSAs devices and instructed them to stop working without the knowledge of the respondent, the Court, in its judgment, did not state the p eriod when this allegedly took place. According to the app ellant, the phones were only blocked after the expiration of the contract. We were referred to the statement of claim, appearing at page 35 of the record of appeal where the respondent stated that the phones wer e blocked after the expiration of the contract. The Court below found that the contract ended on 29 th February 2020 by effluxion of time. Tha t the Court, therefore , J17 contradicted itself by failing to see that any access to the appellant's banking system was only restricted after the termination of the contract. We were urged to uphold the appeal with costs. 6 .0 RESPONDENTS HEADS OF ARGUMENT 6 . 1 The parties attempted to file a Consent Order extending the time for the respondent to file heads of argument out of time. We declined to allow the respondent to file its heads of argument out of time, the reason advanced for the delay being unacceptable to the Court. We further excluded the respondent from participating in the hearing. 7 .0 AT THE HEARING 7 . 1 At the hearing, counsel refer red us t o a recent decision of the Court in Anna Anthony Mross v BHM Enterprises Limitedl1°l which dealt with an aspect of special damages. That special damages must be proved with evidence. 7 .2 In respect of the alleged contractual obligations, counsel referred us to page 489 of the record of appeal, the interaction between the Judge in the Court below and the respondent, where the latter conceded that none of the terms stated was part J18 of the contract. Despite the above, the learned Judge went ahead to hold that there was a breach of con tract. 8 .0 ANALYSIS AND DECISION OF THE COURT 8. 1 We have considered the appeal, h eads of argument advanced and authorities cited. The following facts are not in dispute, that the appellant and respondent entered into a contract for the provision of outsourcing of model digital sales agents. The latter was to recruit 104 youths as DSAs in Southern and Western Provinces. It is further not in issue that mobile phones were provided to the respondent. We refer to the contract at pages 53 to 70 of the record of appeal, as well as the addendum extending the contract by four months up to 29 th February 2020. It is further not in issue that the contract came to an end by effluxion of time. 8.2 The issues in dispute relate to breach of contract, whether the appellant breached the agreement between the parties, as well as the contractual terms of the contract. Was the Judge correct in finding that the appellant had breached the contract and in awarding special damages? J19 8 .3 It is trite that a trial Judge's findings of fac t should not be reversed or disturbed in the absence of sound reasons such as those stated in th e Attorney General v Marcus K Achiume(9l case . That as an appellate Court, the threshold for intervention is high , unless the findings are wrong or are manifestly against the weight of evidence. We have reviewed the evidence adduced at trial and the pleadings in the lower Court. 8 .4 The appellant denies that it contractually agreed to supply the r espondent with promotional materials, internet bundles, adequate starter packs, a dedicated information technology team, system reports, and banking facilities , or to configure devices to enable access to the appellant's system. 8 .5 It is worth noting that the parties r educed the agreement into writing. In the Court below, the respondent relied on the TORs contain ed in the proposal to allege that the TORs were part of the appellant's obligations to the respondent. The Supreme Court, in African Banking Corporation (Z) Limited v Plinth Technical Works Limited & Others(lll, refer enced its decision in Kalusha Bwalya v Chadore Properties Kalusha Bwalya v Chadore Properties and Ian Chamunora Nyalungwe J20 Haruperil12l, stating that the intention of the parties 1n a contract is discernible from the documents they execute. They reiterated the principle that extrinsic evidence is generally not admissible to add to, vary, subtract from, or contradict the terms of the written contract. It was also held that where parties choose to embody their agreement into documents , they are bound by those documents. In this instance, the contract executed between the parties appearing at page 54 of the record of appeal, categorically stated what documents would constitute the contract between the parties and these are: i) ii) The Contract Special Conditions of Contract (SCC) iii) The Quotation submitted by the Bidder iv) The Local Purchase Order v) Attached Schedule of Pricing "A" and; vi) Attached Schedule - Scope of Work Appendix "B". 8. 6 Therefore, the above-listed do cum en ts will inform our decision on whether the appellant was in breach of the contract. The appellant produced the contract exhibited in the Court b elow, which was contained in the respondent's bundle of documents. The said contract has a provision under the special conditions J21 of the contract, stipulating further obligations of the parties. The record shows that the respondent also filed a supplementary bundle of documents but the same did n ot include a complete contract. 8 . 7 The respondent contends that th er e was breach of contract by the appellant in failing to provide promotional m aterials , internet bundles, adequate starter p acks and a dedicated information technology team to resolve issues and failure to configure devices. The responden t 's position is that it failed to perform and meet its targets due to the a bove issu es. Was th e failure to perform or meet its targets as a result of the a ppellant's breach of contract by failing to fulfil its obligations? 8.8 We h ave analysed the evidence on record. In respect of the provision of data bundles, the terms of refer en ce a t page 21 7 stipulated that the Bank "shall also provide the vendors with data as shall be required for account opening" . Data bundles to use with the devices were provided. DW3 testified that all mobile phones were configur ed to a ccess th e Bank Virtu al Private Network au tom a tically without a n eed for a data bundle as long as the phone's mobile Data Option was enabled. The J22 account opening was connected to MTN. And the appellant was r esponsible for the payment of data to MTN. Further that the appellant deactivated inactive numbers which were not being used by the respondent's DSAs. 8 .9 We are of the view that there was no failure to provide data bundles, as all mobile phones were configured to access the appellant's virtual private network without the n eed for data bundles. 8 .10 As regards the issue of devices not working or not being configured, the evidence was that only devices that were not used were deactivated. The appellant, under the contract, reserved the right to retrieve any inactive devices and to redistribute them to vendors with high productivity. 8 . 11 On th e issue of delays/ shortages 1n issuing starter p acks/product brochures, the pre-bid meetings of 20 th September 20 18, and the request fo r proposals for the provision of services for outstanding DSAs at pages 223 and 226 of the r ecord of appeal, are the documents that refer to t-shirts, product brochures, DSAs branding and giveaways during special events by ZANACO and are not part of the contract. The • J23 contract between the parties stipulated that it shall prevail over all other contract documents. In the event of any inconsistency/ discrepancy with the contract documents , the contract would prevail over other documents in the order listed earlier. We accordingly find and hold the view that delays in the provision of starter packs and promotion materials did not constitute a breach. Evidence was adduced that there was an option to open cardless accounts, without the need for starter packs, which other DSAs were doing including the respondent. 8.12 We have found nothing that relates to the appellant's obligations to provide the respondent with promotional materials, adequate starter packs, a dedicated information technology team, system reports, and banking facilities , or to configure devices to enable access to the appellant's system. As things stand, the contract relied on by the respondent does not show that the appellant was obligated to provide the respondent with any of the listed items it m entioned. Accordingly, we are precluded from creating a new contract for the parties, outside the one which they voluntarily entered into and signed. The J24 contract does not impute the appellant with th e contractual obligations claimed by the responden t . 8 . 13 We have also paid heed to the interaction of th e learned Judge in the Court below at pages 488 to 489 of the record of appeal. The learned Judge took the r espondent through the statement of claim at p aragraph 7 , in which h e pleaded breach of contract on account of the failures earlier highlighted (i) to (vii) appearing at p age 35 of the record of appeal. The witness was asked whether the terms therein were in the con tract. The r espondent categorically stated that the said terms were not in the contract. Despite the above evidence, wher e even the respondent conceded that the terms alleged to h ave been breached were n ot part of the contract, the Court b elow proceeded to find breach of contract of the alleged terms. 8.14 We therefore set aside th e finding that there was breach of contract. The findings/ assessment made by the Court below on an inference of fact i.e. breach of contract on terms not p art of the contract, is plainly wrong and against the weight of both documentary and oral evidence . We substitute it with the holding that there was no breach of contract by the appellant J25 and set aside the award of damages for breach of contract and for loss of business. 8. 15 The poor performance by the respondent cannot be blamed on the appellant. There was evidence that, few DSAs were retained/ employed and targets were not met . .3. 16 It is trite that "he who alleges must prove", and in this case, the respondent h ad the burden of proving that the appellant was contractually obligated to provide it with the claimed items to warrant a claim for breach of contract. In Masauso Zulu v Avondale Housing Project(13l, the Supreme Court stated that, a claimant who fails to prove h is allegations cannot be entitled to a judgment in its favour. In the absence of terms in the contract outlining the appellant's duties to the respondent, there was insufficient evidence to hold that the appellant breached its contractual duties. 8. 17 Having held that there was no breach of contract, it is academic or otiose to determine the claim for damages for loss of business. J26 9.0 CONCLUSION 9.1 We reiterate that there was no breach of contract by the appellant. We set aside the decision of the lower Court awarding damages for breach of contract and for loss of business. We substitute it with the holding that there was no breach of contract. We award costs to the appellant to be taxed in default of agreement. ······· ............. J ................. . M. J. Siavwapa JUDGE PRESIDENT F. M. Chishimba A. N. Patel SC • • • • • • • • • • • • • • • • • • • • • • • • , ft COURT OF APPEAL JUDGE COURT OF APPEAL JUDGE