This is a chamber application for condonation for the late noting of an appeal and extension of time within which to note an appeal made in terms of Rule 43(1) as read with Rule 43(2) of the Supreme Court Rules 2018 (“the Rules”).
The application is opposed.
The order sought by the applicant in this application is as follows:
“RELIEF SOUGHT
WHEREUPON after reading documents filed of record and hearing counsel;
IT IS ORDERED THAT:
1. The applicant's non-compliance with Rule 38(1)(a), Rule 37(1)(e), Rule 37(2), Rule 55(5) of the Supreme Court Rules be and is hereby condoned.
2. The application for extension of time within which to note an appeal be and is hereby granted.
3. Within 5 days of this order, the applicant shall file and serve its notice of appeal.
4. There shall be no order as to costs.”
On 5 December 2023, in an ex tempore judgment, I struck the matter off the roll with costs. The applicant has requested for the written reasons for judgment. These are they.
FACTUAL BACKGROUND
The background to this application can be summarised as follows:
In December 2011, the applicant lent and advanced an amount of One Million United States Dollars (USD$1,000,000) (hereinafter referred to as the loan) to the first respondent to fund its cotton seed purchase for the 2012 buying season.
The second to the sixth respondents (Virendra Ranchod, Manojkumar Jivan, Jayprakash Patel, Vinodkumar Rama and Serish Ranchod) executed personal guarantees in respect of the transaction that bound them as guarantors of the loan.
They jointly and severally bound themselves in varying amounts in respect of the loan.
In addition, the respondents also bound themselves as sureties and co-principal debtors for a punctual re-payment of the loan.
The seventh respondent (Gloworm Investments (Pvt) Ltd) tendered Stand number 7489 of Salisbury Township held under Title Deed number 8677/97 as security for the loan.
The first respondent (Myrammar Farming (Pvt) Ltd) t/a Cottonzim), duly represented by the second and sixth respondents, undertook to pay this amount in full on or before December 2012.
Despite various letters demanding payment by the applicant, the respondents failed to pay the applicant back the full amount as had been agreed.
In November 2013, the first respondent signed an acknowledgment of debt in respect of the loan in the sum of one million United States dollars plus interest.
On 30 July 2014, the first respondent was placed under provisional judicial management.
On 8 June 2016, the applicant instituted proceedings against all the respondents in the High Court, under case number HC5762/16, wherein he sought, inter alia, the payment of the USD$1 million, which amount had been advanced to the first respondent.
PROCEEDINGS BEFORE THE COURT A QUO
On 10 May 2022, at the commencement of the trial, the third to the fifth respondents raised three points in limine:
(i) Firstly, that the matter had prescribed;
(ii) Secondly, that there was a violation of the provisions of the Exchange Control Regulations; and
(iii) Lastly, that leave of the court was required before suing the first respondent which was under provisional judicial management.
In arguing the third preliminary point, counsel for the applicant submitted, that, leave was only required in respect of already existing proceedings at the time the provisional order is granted and that no leave was required for new suits. In support of this argument, counsel cited the case of Zambezi Gas Zimbabwe (Pvt) Ltd & Anor v N.R. Barber (Pvt) Ltd & Anor SC03-20.
Per contra, counsel for the first respondent argued, that, leave to sue a company under judicial management was necessary, and, failure to do so was fatal. He further submitted, that, the rationale for judicial management is an endeavour to resuscitate a company and avoid liquidation hence the need for leave.
The court a quo dealt with the issue regarding leave to sue; it upheld, that, the first respondent, being a company under provisional judicial management, could not be sued without leave of the court.
Aggrieved by this decision, the applicant noted an appeal in the Supreme Court under case number SC146/23 wherein he sought the setting aside of the decision of the court a quo upholding the preliminary point.
The appeal was noted on the grounds, that, the court a quo erred in finding that the applicant was required to seek leave to sue the first respondent notwithstanding that the applicant instituted proceedings against the respondents after the provisional order placing the first respondent in judicial management was handed down.
Further, the applicant averred, that, the court a quo erred in overriding the position that leave to sue companies placed under provisional judicial management only applies to proceedings already in existence at the time the provisional judicial management order is granted.
Lastly, the applicant averred, that, the court erred in failing to find that the respondents were estopped from raising the point relating to leave to sue in light of the fact, that, the issue had already been dealt with by the High Court.
It is important to note, that, the appeal was timeously lodged on 15 March 2023. The applicant offered to pay security for the respondents costs, but, however, while such tender was made, the security for costs was not paid within one month from the date of filing the notice of appeal.
The appeal was then deemed to have been abandoned and dismissed by operation of the law.
On 18 October 2023, the applicant filed an application for reinstatement of the appeal that had been deemed abandoned and dismissed under case number SC579/23. However, the appeal that the applicant sought to reinstate was mistakenly set down for hearing on 31 October 2023.
In light of these events, the applicant wrote a letter to the Registrar of the Supreme Court seeking for the application for reinstatement to be heard prior to the set down date.
The applicant was advised by the respondent's legal practitioners, that, the correct application to be filed was an application for condonation and extension of time within which to note an appeal and not reinstatement since the appeal was regarded a nullity.
The Registrar sent the applicant a notice, that, the application for reinstatement was set down for hearing on 1 November 2023.
Consequently, on 31 October 2023, at the hearing of the appeal, the applicant sought for the removal from the roll of the appeal under SC146/23 for the reason, that, it had been deemed abandoned and dismissed by operation of the law.
By consent, the appeal was removed from the roll.
On 1 November 2023, the applicant withdrew the application for reinstatement with a view to filing an application for condonation and extension of time within which to note an appeal and ensuring that the appeal would be heard on the merits.
It is against this background, that, the applicant approached this Court with the present application seeking condonation for the failure to comply with Rule 38(1)(a), Rule 37(1)(e), Rule 37(2) and Rule 55(5) of the Supreme Court Rules 2018.
PROCEEDINGS BEFORE THIS COURT
At the hearing of the application, counsel for the applicant submitted, that, the application for condonation and extension of time within which to note an appeal had been necessitated by the apparent fact, that, there had been non-compliance with the rules of this Court.
She submitted, that, the failure to pay security for costs was not deliberate, but, actuated by a mis-interpretation and oversight on the import of Rule 55(1) and Rule 55(2) of the Supreme Court Rules.
She further submitted, that, the applicant, upon realising concerns raised by the respondents relating to the validity or otherwise of the appeal for non-compliance with the Rules, took steps to rectify the non-compliance.
She contended, that, the breach of the Rules was not deliberate and not caused by the applicant, but, borne out of a genuine oversight by his legal practitioners.
Further, she submitted, that, the respondents would not suffer any prejudice if condonation and extension of time is granted.
As regards prospects of success on appeal, counsel submitted, that, the applicant enjoyed prospects of success because leave to sue a company under judicial management only applies to actions or proceedings already in existence at the time that the provisional order is granted.
She argued, that, no leave is required to institute proceedings against a company under provisional judicial management after the provisional order has been granted.
She prayed, that, in view of the explanation for non-compliance and the delay which she described as “not inordinate” coupled with the fact, that, the applicant enjoyed prospects of success on appeal, the court ought to grant the indulgence.
Counsel thus sought that condonation and extension of time within which to note an appeal be granted.
Per contra, counsel for the third, fourth and fifth respondents opposed the application.
He submitted, that, the application was fatally defective for the reason that the earlier, albeit irregular appeal, remained hanging in the court's records as it was not struck off the roll at the instance of the applicant.
He further submitted, that, the applicant, despite being conscientised of the irregularities, persisted on a trajectory of filing defective processes. He argued, that, even the present application was improperly before the court as a Judge sitting alone in chambers could not strike off an appeal that has been filed, and, in casu, the appeal under SC146//23 remained on record.
He further submitted, that, the applicant did not proffer an explanation for the failure to pay security for costs and the reason for the filing of irregular process.
He also submitted, that, the applicant, instead of explaining the non-compliance with the Rules, merely alludes to the respondents having highlighted irregularities which they were quick to attend to.
He contended, that, the applicant did not tender an explanation for the delay and that there was no satisfactory explanation offered for the non-compliance and filing of a defective process.
He reiterated the point, that, the present application was improperly before the court as the appeal under SC146/23 was still before the court.
Regarding the merits of the appeal, counsel for the third, fourth and fifth respondents submitted, that, the application did not enjoy any prospects of success. He referred to the case of Allied Bank Limited v Dengu & Others SC52-16 which is authority for the requirement to seek leave to sue a company placed under judicial management.
Counsel submitted, that, the application, being improperly before the court, ought to be struck off the roll.
ISSUES FOR DETERMINATION
The issues that fall for determination in this case are as follows:
1. Whether or not the application is properly before the court.
2. Whether or not the requirements for granting condonation for late noting of an appeal and extension of time have been satisfied.
THE LAW
It is trite, that, when an application is improperly before the Court, there will be no application for the court to relate to. The matter which is improperly enrolled faces the fate of being struck off the roll.
In the case of Ahmed v Docking Station Safaris (Private) Limited t/a CC Sales SC70-18…, this Court made the following pertinent remarks:
“In view of the above, it is clear, that, the applicant has approached this court with a wrong application. The circumstances to make an application for condonation for non-compliance with the rules and extension of time within which to file and serve a notice of appeal. This, the applicant failed to do.
The net effect of bringing a wrong application before the court is that there will be virtually nothing placed before it, and, to that end, the application cannot stand.”..,.
The law applicable to applications for condonation and extension of time within which to comply with the Rules and file the relevant application or appeal is settled.
The requirements for this application were aptly captured by GUBBAY CJ…, in the case of Forestry Commission v Moyo 1997 (1) ZLR (S), and, they are as follows:
(a) That, the delay involved was not inordinate, having regard to the circumstances of the case;
(b) That, there is reasonable explanation for the delay;
(c) That, the prospects for success, should the application be granted, are good;
(d) The possible prejudice to the other party should the application be granted.
In addition to the above, in the case of Hove v Berea Mining Syndicate SC50-23…, it was aptly stated that:
“It is trite, that, for an application for condonation for non-compliance with the Rules and for extension of time within which to note an appeal to succeed, the applicant should satisfy the court, that, he or she has a reasonable explanation for the delay and non-compliance with the Rules, and also establish that there are prospects of success of the appeal.”
It is important to note, that, these factors are not individually decisive on whether the application for condonation for late noting of appeal and extension of time within which to appeal is granted. They are considered conjunctively.
In Kodzwa v Secretary for Health & Anor 1999 (1) ZLR 313 (S), SANDURA JA remarked as follows:
“Whilst the presence of reasonable prospects of success on appeal is an important consideration which is relevant to the granting of condonation, it is not necessarily decisive. Thus, in the case of a flagrant breach of the Rules, particularly where there is no acceptable explanation for it, the indulgence of condonation may be refused - whatever the merits of the appeal may be.”
APPLICATION OF THE LAW TO THE FACTS
After considering both the written and oral submissions by counsel, it is apparent, that, the appeal in case number SC146/23 which was deemed abandoned and dismissed by operation of law has a life line for reinstatement as provided for in Rule 70 of the Supreme Court Rules 2018.
It is an established principle, that, when a matter is deemed abandoned and dismissed because of operation of the law, it is removed from the roll.
In casu, it is worthwhile to refer to the orders of this Court in respect of the matter. The order in the record, issued on 31 October 2023, is pertinent. The order reads as follows:
“IT IS ORDERED THAT:
1. By consent, the matter be and is hereby removed from the roll for the reason, that, it has been deemed abandoned and dismissed in terms of Rule 55(6) of the Supreme Court Rules 2018.
2. The appellant shall bear the respondent's costs for today's appearance.”
In respect of the chamber application for condonation and reinstatement of the appeal, the application was removed from the roll for the reason, that, it had been withdrawn. On 1 November 2023, the court ordered as follows:
“IT IS ORDERED BY CONSENT THAT:
The matter is removed from the roll, with no order as to costs, for the reason, that, it has been withdrawn.”
The import of these orders is that the appeal in case SC146/23 therefore remains deemed abandoned and dismissed.
Counsel for the third, fourth and fifth respondents submission, that, the application in the present case is fatally defective, is confirmed by the sequence of earlier highlighted proceedings before this Court.
In my view, the appeal under SC146/23 stands in the way of seeking condonation and extension of time within which to note an appeal by operation of the law. The proper way to revive an appeal deemed abandoned and dismissed is by seeking reinstatement.
In the present case, the applicant's non-compliance with Rule 55 of the Supreme Court Rules 2018 resulted in the appeal being deemed abandoned and dismissed. Rule 55 is instructive. It provides as follows:
“55. Security
1. If the judgment appealed from is carried into execution by direction of the court appealed from, security for the costs of appeal shall be as determined by that court and shall not be required under this rule.
2. Where the execution of a judgment is suspended pending an appeal and the respondent has not waived his or her right to security, the appellant shall, before lodging copies of the record with a Registrar, enter into good and sufficient security for the respondent's costs of appeal:
Provided that where the parties are unable to agree on the amount or nature of the security to be furnished —
(i) The matter shall be determined by the Registrar upon application by the appellant; and
(ii) The Registrar shall specify the period within which the security shall be furnished.
3. A judge may, on application, at the cost of the appellant, and for good cause shown, exempt the appellant wholly, or in part, from the giving of security under subrule (2).
4. No security for costs in terms of subrule (2) need be furnished by the Government of Zimbabwe or by a municipal or city council or by a town management board.
5. Subject to the proviso to subrule (2), where an appellant is required by this Rule to furnish security for the respondent's costs of appeal, such security shall be furnished within one month of the date of filing of the notice of his or her appeal in terms of Rule 37, or, where applicable, within the period specified by the Registrar in terms of the proviso to subrule (2).
6. If an appellant who is required to furnish security for the respondent's costs of appeal fails to furnish such security with (in) the period specified in subrule (5), the appeal shall be regarded as abandoned and shall be deemed to have been dismissed.”…,.
The rules provide for reinstatement of such an appeal that has been deemed abandoned and dismissed. Rule 70 of the Supreme Court Rules is apposite. It provides that:
“(1) Where an appeal is —
(a) Deemed to have lapsed; or
(b) Regarded as abandoned; or
(c) Deemed to have been dismissed in terms of any provision of these rules;
the Registrar shall notify the parties accordingly.
(2) The appellant may, within 15 days of receiving any notification by the Registrar in terms of subrule (1), apply for the reinstatement of the appeal on good cause shown.”…,.
In casu, the appeal was removed from the roll because it was deemed abandoned and dismissed since the applicant had not paid security for costs within the prescribed time.
The redress to this infraction is as provided for in the Supreme Court Rules 2018.
The applicant in this case, while apportioning blame to the respondents for consenting to the orders granted, cannot be exculpated from lack of probity and diligence.
It is clear, that, the applicant has approached this Court with a wrong application for condonation and extension of time within which to note an appeal, when, in actual fact, the deemed abandoned and dismissed appeal can be resuscitated by seeking condonation for non-compliance with Rule 55(5) of the Supreme Court Rules 2018 and extension of time within which to pay security of costs.
Further, the applicant ought to file for condonation for late filing of the application for reinstatement and extension of time within which to file an application for reinstatement and reinstatement of the appeal.
In the case of Gazi v Mbababala Properties (Pvt) Ltd SC24-23, MAVANGIRA JA, sitting in chambers, stated that:
“It is my considered view, that, in such a situation, a litigant, on becoming aware, by itself, of the fate of its appeal by reason of operation of the law, per Rule 55 as read with Rule 70, may properly apply for condonation of non-compliance with the rules and for the extension of time within which to file an application for reinstatement.”
These remarks resonate well with the circumstances of the present case.
See also Ahmed v Docking Station Safaris (Private) Limited t/a CC Sales SC70-18, which emphasized the fact, that, bringing a wrong application before the court virtually places nothing for the court to relate to.
The circumstances presented require the applicant to make a composite application for condonation for non-compliance with the rules and extension of time within which to pay security of costs of court, condonation for the late filing of the application for reinstatement and the extension of time within which to file the application for reinstatement and reinstatement of the appeal, which is already in the system.
In view of the fact, that, the matter is improperly before the court, it ought to be struck off the roll....,.
The fact that the applicant's legal practitioner acted upon the suggestions of the respondents counsel on the defects in the notice of appeal, and the promise not to oppose the application, do not validate the propriety of the present application.
When an appeal has been removed from the roll, for the reason that it has been deemed abandoned and dismissed by operation of the law, recourse is provided for in the Rules through an application for condonation of non-compliance with the rules and reinstatement.
Seeking condonation and extension of time to note an appeal, in this case, is incompetent and the applicant was thus misguided in this regard.
The application is improperly before the court, hence, the matter ought to be struck off the roll.
