MATHONSI
JA: On
4 November 2021 the High Court (“the court a
quo”)
struck off the roll with costs on a higher scale an urgent
application filed by the appellant for an order directing the third
respondent to forthwith surrender to the fourth respondent a
replacement deed of transfer number 9068/2008 and barring the third
respondent from using such replacement deed of transfer in lieu of
the original on the pain of costs on the adverse scale.
This
appeal is against that striking off judgment which the appellant
would like to have set aside and substituted with the substantive
relief it unsuccessfully sought in the court a
quo.
BACKGROUND
FACTS
The
facts relevant to the resolution of this appeal are largely common
cause.
The
first respondent is the liquidator of Interfin Banking Corporation
(“Interfin”) which is undergoing final liquidation. The second
respondent is the company secretary of the first respondent whom the
appellant elected to join as a party to the proceedings in her
personal capacity for unclear reasons.
The
third respondent is the owner of certain immovable property known as
Lot 3 of Bannockburn, Harare which it holds by Deed of Transfer
Number 9068/2008.
As
security for a debt owed to Interfin, the third respondent
surrendered its title deed to Interfin which registered Mortgage Bond
No.5818/2011 on the title deed.
In
turn, Interfin obtained certain sums of money from the appellant
which it secured by the third respondent's title deed surrendered
to the appellant.
Since
then the appellant has tenaciously held onto the title deed in
question despite demand for its release made by the liquidator in the
discharge of its duties as such.
Indeed,
the liquidator was constrained to demand the surrender of the title
deed after the third respondent acquitted all its indebtedness to
Interfin, the company in liquidation, thereby obliging the liquidator
to cancel the mortgage bond.
Following
the repayment of the loan, the liquidator was also obliged to hand
the title deed over to the third respondent.
Bereft
of any sense of solution, the liquidator applied for a replacement
title deed from the Registrar of Deeds, the fourth respondent herein.
The
fourth respondent acceded to the application and issued a replacement
title deed on 7 September 2021.
That
triggered the present litigation.
The
appellant moved swiftly and filed an urgent application for a
mandamus
on 13 October 2021.
As
I have said, it sought in the interim, the immediate surrender to the
fourth respondent of the replacement title deed and the barring of
the third respondent from using it for whatever purpose.
The
basis of the application was that, not only were the respondents
aware that the appellant was in possession of the original title
deed, the third respondent was selling properties to individuals
using the replacement title deed. According to the appellant, the
third respondent's conduct was causing irreparable damage and undue
hardship to it by dissipating the immovable property.
The
application was opposed by the first, second and third respondents.
They
raised a number of preliminary objections, chief among which were the
failure of the appellant to obtain leave of the court to sue the
first respondent, the liquidator of a company in liquidation and the
misjoinder of second respondent in her personal capacity.
The
court a
quo
found that the application was improperly before it by reason that no
leave to sue had been sought and obtained before embarking on
litigation.
In
arriving at that conclusion the court a
quo
followed the case of Chikura
N.O. & Anor v Alshams Global BVI Ltd
SC23/20
in which this Court remarked at p6-7:
“As
correctly observed in part by the court a
quo,
leave of the court is required before proceeding against a company
and/or bank in liquidation. This is so because the broad purpose of
the law of insolvency and the winding up of companies is to ensure
due distribution of the insufficient assets of the debtor company
amongst the competing creditors under the watchful eyes of the court.
Thus, the position is settled at law that an order placing an estate
or a company in liquidation has the effect of creating a concursus
of the creditors of the insolvent and no creditor can thereafter do
anything that will alter the rights and interests of other creditors
without the leave of the court. Unsupervised and unsanctioned
litigation and proceedings against the insolvent will disturb the due
distribution of the insufficient assets and remove the role of the
court from the process.
It
may also be added that the leave of the court is necessary in such
circumstances as a broader consideration of protecting the
economically fragile company from unnecessary litigation quite apart
from merely protecting the interests of the creditors.
It
being common cause that leave of the court was not sought and
obtained prior to the institution of the proceedings a
quo,
the appeal succeeds on this basis alone.”
Indeed,
as in the present case, the respondent in that case had sued the
liquidator of Interfin without the leave of the court.
It
argued that the cause was not against the Bank but was against the
liquidator as an administrative authority under the Administrative
Justice Act [Chapter
10:28].
The
court a
quo
refused to be drawn to consider the merits of the application. It
reasoned at para 20 of its judgment:
“There
are set procedures that are followed by a creditor to recover a debt
from a company under liquidation. Leave to sue is necessary for a
party to show the court why its particular case needs a suit outside
the normal procedures that are there for recovering a debt by
creditors through the appointed liquidator. It is the court that is
tasked with assessing the merits of any application including its
prospects of success based on the sufficiency of evidence placed
before it. Indeed it would have been under such an application for
leave to sue that an issue such as that raised by respondents herein
that the company is not registered locally would have been considered
under prospects of success in determining whether or not that leave
to sue should be granted.”
THE
APPEAL
The
appellant was thoroughly disgruntled by that outcome.
It
launched this appeal on 6 grounds including an attack on the
conclusion of the court a
quo
that leave to sue was required.
Although
there are multiple grounds the issue for determination is very narrow
indeed.
It
is whether there was need for leave to be sought and obtained before
filing the application against the liquidator.
I
should add that prior to the date of hearing of the appeal, the first
and third respondents gave notice of objections in terms of Rule 51
of the Supreme Court Rules, 2018.
After
hearing counsel on the objections, this Court requested to be
addressed on the merits while parking its decision on the preliminary
objections.
This
was done in the interest of expediency to avoid reconvening again
depending on the outcome of the preliminary objections.
Accordingly,
with the consent of the parties, the court heard the merits of the
appeal on the understanding that they will only be related to in the
event of the preliminary objections not being upheld.
I
proceed therefore to consider those objections.
Mr
Moyo
for the first and second respondents premised his objections on 3
points.
(i)
First, counsel submitted that the judgment of the court a
quo
sought to be impugned, to the extent that it merely struck the
applicant's application off the roll for want of leave to sue the
liquidator, is not appealable at all. It does not meet the
requirements of a judgment that can be appealed against.
In
advancing that argument reliance was placed on two South African
authorities. The first is the case of Zweni
v Minister of Law and Order
1993
(1) SA 523 (A) which set out three attributes of an appealable
judgment. These are that;
(i)
the decision must be final in effect and not susceptible to
alteration by that court;
(ii)
it must be definitive of the rights of the parties by granting
definite and distinct relief; and
(iii)
it must have the effect of disposing of at least a substantial
portion of the relief claimed in the proceedings.
The
first and second respondents case is that none of the foregoing three
requirements of an appealable judgment exist in the impugned judgment
because the court a
quo
deliberately refrained from delving into any of the merits of the
dispute. Instead it was content to strike off the application on the
basis that leave was not obtained. The court a
quo
will still determine the merits once leave is obtained.
The
other authority cited by Mr Moyo
is Pretoria
Garrison Institutes v Danish Variety Products 1948
(1) SA 839 (A) at p867 where the following remarks were made:
“A
wholly unrestricted right of appeal from every judicial pronouncement
might well lead to serious injustices. For, apart from the increased
power which it would probably give the wealthier litigant to wear out
his opponent, it might put a premium on delaying and obstructionist
tactics. This
latter consideration has, I imagine been the predominant one in
leading legislators to try to restrain the bringing of appeals from
orders of a preparatory or procedural character arising in the course
of a legal battle.” (The underlining is for emphasis).
Contesting
that preliminary objection, Mr Uriri
for the appellant submitted that whenever there is a sentence or
judgment of the court that a litigant is unhappy with, there is a
right to appeal.
In
counsel's view, it would be a sad day indeed, were certain matters
be made to end at the court a
quo
without testing their correctness on appeal.
(ii)
Second, Mr Moyo
submitted that the judgment of the court a
quo
that the application was improperly before it for want of leave to
sue the liquidator and therefore striking it off the roll, was
interlocutory in nature. For that reason, so it was argued, it could
not be appealed without the leave of the court a
quo.
In
counsel's view, the striking off of the application was merely a
procedural step which at best was merely interlocutory. To that
extent, any challenge of the judgment is regulated by section 43(2)
of the High Court Act.
Ms
Mahere
for the third respondent also took a similar preliminary objection
based on absence of leave to appeal.
She
submitted, associating herself fully with submissions made on behalf
of the first and second respondents, that for all intents and
purposes, the striking off was interlocutory.
Counsel
maintained that, the appeal is improperly before the court because
leave to appeal was not sought.
In
addition, Ms Mahere
urged the court to take judicial notice of proceedings instituted by
the appellant in case number HC6264/21. According to counsel, it is
an application, exactly the same as the one forming the basis of this
appeal, brought by the appellant after its initial application was
struck off the roll. It seeks the same relief, except that in it the
appellant did not join the executor and its company secretary.
It
was submitted that this was a clear case of preemption.
The
right of an unsuccessful litigant to appeal, it was argued, is
preempted when that litigant, at the same time, complies with the
judgment. By filing the same application without citing the first and
second respondents, the appellant should be taken as having accepted
the correctness of the judgment a
quo.
In
response, Mr Uriri
did not directly address the question whether the judgment was
interlocutory and therefore requiring leave of the court a
quo
before an appeal could be noted.
He
submitted that in the body of the judgment, the court a
quo
commented on the merits of the matter. For that reason, the court is
at liberty to entertain the appeal even though leave was not sought.
In
making that argument, Mr Uriri
relied on the case of Portland
Holdings Ltd v Tupelostep Investments (Pty) Ltd & Anor
SC 3/15 in which an application was adjudged by the court a
quo
as not urgent. The court a
quo
had however gone on to dismiss the application instead of striking it
off the roll to enable the applicant therein, if it so wished, to
proceed with the application as an ordinary application.
Apart
from that, the court a
quo
had also made several comments on the merits of the matter and also
overlooked most of the relevant evidence pointing to the urgency of
the application. This Court was clear that “the matter ought to
have been dealt with on the basis of urgency.” Taking all the
mistakes made a
quo
into account and that the appeal court was in as good a position as
the court of first instance to determine the matter and substitute
its own discretion, this Court allowed the appeal. It granted the
relief sought in the application.
Mr
Uriri
urged of this Court the adoption of the same approach because the
court a
quo
in the present case also made comments on the merits of the matter.
He
submitted that this Court should grant the full relief sought a
quo
even
though the court a
quo
did not relate to the merits or the relief sought.
Regarding
preemption, it was submitted on behalf of the appellant that its
grief with the judgment a
quo
was recorded in the notice of appeal filed in this Court. In
counsel's view, the fact that subsequent to the filing of that
notice of appeal, the appellant saw it fit to return to the court a
quo
with another application did not signify satisfaction with the
judgment appealed against.
This
is so, so the argument goes, because the parties in the subsequent
application are different from those in the present matter.
ANALYSIS
Regarding
the issue whether the judgment of the court a
quo
is appealable, my view is that the procedure for appealing in this
jurisdiction is heavily regulated.
As
shall become apparent shortly, even the orders of the nature of the
one which is the subject of the present appeal, are regulated by
statute. As such, if the legislature intended to constrain any right
of appeal it would have said so in specific terms.
Indeed,
even the authority relied upon by Mr Moyo,
Pretoria Garrison Institutes, supra,
presupposes that the restrain from appealing certain court orders has
to be imposed by the law-giver before the right of appeal can be
restricted or prohibited.
I
am therefore not persuaded by the first leg of the first and second
respondents preliminary objection. It is accordingly rejected.
In
my view, that position accords with the constitutional right of
access to the courts for the resolution of any dispute enshrined in
section 69(3) of the Constitution.
The
question whether the judgment a
quo
is interlocutory or not is central in the resolution of the second
leg of the preliminary objection.
Section
43(2) of the High Court Act [Chapter
7:06]
governs appeals against interlocutory judgments or orders. It
provides:
“(2)
No appeal shall lie -
(a)…………………
(b)…………………
(c)…………………
(d)
from an interlocutory order or interlocutory judgment made or given
by a judge of the High Court, without the leave of that judge or, if
that has been refused, without the leave of a judge of the Supreme
Court, except in the following cases -
(i)
where the liberty of the subject or the custody of minors is
concerned;
(ii)
where an interdict is granted or refused;
(iii)
in the case of an order on a special case stated under any law
relating to arbitration.”
There
is little doubt that the phrase “interlocutory order” is one that
has vexed the legal mind for a considerably long time.
Its
definition has eluded the courts but there is a very helpful
discussion of it by DEVITTIE J in Mwatsaka
v ILC Zimbabwe
1998
(1) ZLR 1 (H) where the learned Judge reviewed a number of
authorities discussing the phrase “interlocutory orders.”
He
referred to the reasoning of CORBETT JA (as he then was) in South
Cape Corp v Engineering Management Services
1977 (3) SA 534 (A) at 549 where the court remarked:
“I
think, nevertheless, the general effect of this series of decisions,
together with consistent judgments of other courts, may be summarized
as follows:
(a)
In
the wide and general sense, the term 'interlocutory' refers to
all orders pronounced by the court, upon matters incidental to the
main dispute, preparatory to, or during the progress of, the
litigation. But orders of this kind are divided into two classes:
(i)
Those which have a final and definitive effect on the main action;
and
(ii)
Those known as simple (or purely) interlocutory orders proper, or
'interlocutory orders proper' which do not (see generally Bell
v Bell
1908 TS 887 at p890; Steytler
N.O. v Fitzgerald supra
at pp303, 311, 325-6, 342; Globe
& Phoenix Gold Mining Co. Limited v Rhodesian Corp Ltd
1932 AD 146 at pp153).”
The
court went on at p8C, relying on the authority of the Pretoria
Garrison case, supra,
to make the point that the test as to whether an interlocutory order
is one which is preparatory or procedural and therefore not
appealable unless it is such that it disposes of any of the issues or
any portion of the issue in the main action or suit or it irreparably
anticipates or precludes some of the relief which would or might be
given at the hearing.
As
stated in Mwatsaka,
supra,
those interlocutory orders which do not meet the criteria of
non-appealable orders set out in Pretoria
Garrison, supra,
are
termed simple interlocutory and are appealable with leave in terms of
section 43(2) of the High Court Act.
It
occurs to me that the order striking off the appellant's
application from the roll was interlocutory in the sense that it did
not determine any issue which was the subject of the main suit.
It
was, however, appealable in the sense that it brought the entire
edifice of the application to a screeching halt.
The
application would not proceed any further until such time that the
appellant sought and was granted leave to sue.
The
judgment left the entire dispute unresolved.
While
the appellant was seeking an interdict, the interdict was neither
granted nor refused thereby disqualifying the matter from one of the
exceptions to the requirement for leave to appeal to be sought.
It
being an interlocutory judgment or order which did not fall under any
of the exceptions set out in para (d) of section 43(2), it means that
leave should be sought and obtained from the judge
a quo,
or a judge of this Court before an appeal can be brought to this
Court.
On
the issue of preemption raised by Ms Mahere,
while it is correct that generally the court is always entitled to
make reference to its own records and proceedings (See Mhungu
v Mtindi
1986
(2) ZLR 171 (S)) and it is not disputed by the appellant that it
filed another application which excluded the first and second
respondents, my view is that the issue was raised mainly to buttress
the objection on the need for leave. In addition, it was relied upon
to justify the prayer for costs on the adverse scale.
Having
arrived at the conclusion that leave of the court was required to
lodge the appeal, I find it completely unnecessary to engage the
aspect of preemption beyond what I have done. Clearly, it does not
change the fact that the appeal is improperly before the court.
DISPOSITION
The
judgment or order striking off the application by reason of the
failure of the appellant to obtain leave to sue the liquidator of
Interfin, a company in liquidation, was interlocutory in nature.
The
court a
quo
summarized the respective positions of the parties but simply did not
engage the merits at all. It left all the issues in dispute
unresolved and it is open to the court a
quo
to engage and determine all the issues once leave to sue has been
sought and granted.
The
nature of the judgment or order in question is such that it does not
meet the criteria of a non-appealable judgment or order.
While
it is a simple interlocutory judgment or order it is appealable but
only with leave as required by section 43(2)(d) of the High Court
Act. Such leave not having been sought and granted it was incompetent
for the appellant to purport to appeal to this Court.
As
a corollary to that, the matter is improperly before the court. It
ought to be struck off the roll.
Regarding
the issue of costs, both Mr Moyo
and Ms Mahere
urged the court to grant costs in favour of the respondents on the
adverse scale of legal practitioner and client.
While
such costs only commend themselves as a seal of the court's
disapproval of a litigant's conduct, I am in agreement that they
are indeed justified in the circumstances of this case.
The
appellant is what in criminal procedure is referred to as “a repeat
offender” who has disregarded, not only the procedure for seeking
leave more than once, but also trashed the advice of this Court.
It
has doggedly stuck to its habit of approaching the court without
leave despite the decision of this Court in an earlier case that it
brought.
In
Chikura
N.O & Anor v Alshams Global BVI Ltd, supra,
the appellant sued the liquidator without leave. This Court advised
it that leave to sue was required.
Notwithstanding
that, and without commenting on the propriety of the judgment of the
court a
quo
that leave to sue was again necessary in the appellant's second
approach to the court, it is clear that the appellant again sued the
same liquidator without first seeking leave.
Having
been reminded of the need to seek leave by the court a
quo,
the appellant again purported to file the present appeal without
leave.
In
my view, a conscientious litigant would have been more circumspect
and proceeded with caution.
Yet,
despite the clear provisions of section 43(2)(d) of the High Court
Act that leave was required, the appellant again lodged an appeal
without seeking leave to appeal.
By
so doing it invited the sanction of the court by the only weapon
available to it, the grant of costs on the higher scale, so that in
future the appellant will proceed with caution.
In
the result, it is ordered as follows:
1.
The matter is struck off the roll.
2.
The appellant shall bear the costs on a legal practitioner and client
scale.
KUDYA
JA: I
agree
MUSAKWA
JA: I
agree
Atherstone
& Cook,
appellant's legal practitioners
Scanlen
& Holderness,
1st
and 2nd
respondents legal practitioners
Chambati,
Mataka & Makonese,
3rd
respondent's legal practitioners
