MALAWI
IN THE HIGH
COURT OF MALAWI
PRINCIPAL
REGISTRY
CIVIL CAUSE NO.
3567 OF 2000
BETWEEN:
ZOMBA
MUNICIPAL ASSEMBLY.................... PLAINTIFF
-and-
COUNCIL OF THE UNIVERSITY
OF MALAWI....DEFENDANT
CORAM: THE HON.
MR. JUSTICE F.E. KAPANDA
Mr. Mwala of Counsel for the Plaintiff
Dr. Mtambo of Counsel
for the Defendant
Heard on: 9th
October 2003
Decided: 12th
December 2003
Editorial Note:
In this action the court
has been invited to determine the the following issues:-
1. Whether the plaintiff had legal authority to demand payment of
municipal rates during the period when
the Assemblies were dissolved.
2. Whether
the buildings constituting Chancellor College are assessable property.
3. Whether
the defendant is the owner of the buildings forming part of Chancellor College
and therefore liable to pay municipal rates.
4. Whether the defendant has been in default and in arrears in
the payment of the assessed minicipal rates,
in terms of the Local Government
Act, No. 42 of 1998.
5. Whether
interest is claimable on the said municipal rates.
6. Whether
the defendant is liable to pay legal practitioner’s collection costs.
_____________________________________________________
JUDGMENT
_____________________________________________________
Kapanda, J:
Introduction
The plaintiff is one of
these local government authorities established under the Local Government Act,[1]
42 of 1998. It is claiming from the
defendant the sum of MK5, 662,388.71 being what it is alleging is arrears of
municipal rates. The plaintiff is also
claiming interest on the said arrears of municipal rates. There is also a demand for the payment of
the sum of MK1,091,229.96. This sum,
the claimant says, represents legal practitioner’s collection costs.
The defendant, a statutory corporation
established under the University of Malawi Act,[2] denies being
liable to pay the sums of money mentioned above. In point of fact the defendant argues that the buildings on which
one of its constituent colleges stand does not belong to it. For this reason, so the contention goes, it
can not be made liable to pay the said municipal rates.
HISTORICAL BACKGROUND
Sometime in 1974 the Government of the
Republic of Malawi built and handed over property, situated in Zomba, to the
defendant.[3] The property in question comprise Chancellor
College Campus, a constituent college of the University of Malawi. The plaintiff had been levying rates on the
property and the defendant had been paying municipal rates. It would appear that the levying of rates by the plaintiff and
payment of same by the defendant started when the property was allegedly handed
over to the defendant. This state of
affairs continued until sometime in 1996 when the defendant stopped paying the
said municipal rates.
The plaintiff’s complaint and the
answer by the
Defendant
The claim by the plaintiff
and the defendant’s response thereto are to be discerned from the pleadings that were exchanged
between the parties herein. This court
does not wish to set out in full the said pleadings. It is sufficient for the purposes of this judgment to give a
sketch of what each party is contending.
Further, it must be noted that it was wrong on part of the plaintiff to
plead that the claim against the defendant is made pursuant to Section 144 to
the Local Government (Urban Areas) Act (Cap 22:01) of the Laws of Malawi. The said Local Government (Urban Areas) Act
was repealed.[4]
In its place there is now the Local Government Act (No. 42 of 1998 which came
into force on 8th March 1999.[5] These proceedings were commenced on 17th
November 2000. This was after the new
Act came into force. For this reason,
the pleading should have indicated that the claim is made pursuant to the Local
Government Act (No. 42 of 1998). The
court is of the view that this error did not occasion any injustice on the part
of the defendant. This is demonstrated
by the fact that the defendant’s arguments are premised on the provisions of
the Local Government Act (No. 42 of 1998).
Plaintiff’s claim
The claimant has alleged that the
defendant is the owner of the rateable property forming part of Chancellor
college. As such owner of the property
in question the defendant is liable to pay municipal rates that are now in
arrears since 1996. The arrears of
municipal rates the plaintiff wants to collect from the defendant are in the
sum of MK5,662,388.71. The plaintiff
claims interest on the said arrears.
Furthermore, the claimant wants the defendant to pay it legal
practitioner’s cost in the sum of MK1,091,229.96.
Defendant’s response
The defendant contends that it does not
own the buildings the subject matter of the action by the plaintiff. It is further alleged by the defendant that
the title in the said buildings remain with the Government of Malawi.
The defendant goes on to aver that it is
not liable to pay the plaintiff either the said sum of MK5,662,388.71 for
municipal rates or interest on the said municipal rates or the said legal
collection costs. Further, the
defendant alleges that the claimant has not legal authority to demand from it
the municipal rates in question.
In summary, the defendant has joined
issues with the plaintiff on its claim filed with the court on 17th
November 2000.
Issues for Determination
From the pleadings summarised above the
issues that have arisen and require this court’s determination are as follows:-
(a) whether
or not the plaintiff has legal authority to demand payment of the municipal rates in question.
(b) whether
or not the buildings constituting Chancellor College campus are assessable
property.
(c) whether
or not the defendant is the owner of the buildings forming part of Chancellor College and therefore liable to pay the
municipal rates
assessed for the period in question.
(d) whether
or not the defendant has been in default and in arrears in the payment of the municipal rates
assessed at MK5,662,388.71.
(e) whether
or not interest is payable on the said assessed municipal rates.
(f) whether
or not the defendant is liable to pay legal practitioner’s collection costs.
The court has set out seriatim the
issues for determination in this action.
This, however, does not mean that this court will determine these issues
in the order as they are appearing above.
It is sufficient to mention though that at the end of this judgment this
court will deal with the questions that require determination in this matter.
The court will deal with all the issues
for determination later in this judgment.
For now let me proceed to say something about the evidence that was
offered by the litigants herein.
The Evidence
The parties offered written witness
statements in support of their respective contentions. There were two written
witness statements received from the plaintiff and one such statement from the
defendant. There was one witness
statement done by Mr Stanley Chilemba an Assistant Director of Finance of the Zomba Municipal
Assembly. The other one was from Mr
Griffin Rijons Phashani Baloyi of the Ministry of Lands, Physical Planning and
Surveys. The defendant’s witness
statement was from Mr Yaphet Malunga.
He is the defendant’s Finance
Officer.
These two witnesses availed themselves
before this court for cross-examination.
They also tendered some documents as part of their testimony. Indeed, the evidence offered by these two
witnesses was in a form of written witness statements, oral testimony and
exhibits.
Facts
I will now set out the facts that
emerged from the testimony of these witnesses.
The court shall, as far as practicable, set out the said facts in a
chorological order. Here are the
pertinent facts in this matter.
Payment of rates: 1974-96
As stated earlier on the Government of
the Republic of Malawi built and handed over property to the defendant. The property in question are the buildings
that comprise the Chancellor College and they are in the Municipality of
Zomba. It is observed that there are no
documents to show that the said land comprising of Chancellor College belongs
to the defendant. This notwithstanding
the defendant was paying rates on the said property forming part of Chancellor
College as well as other buildings. It
has not been disputed that the plaintiff was levying rates and the defendant
was paying rates on the property in question.
This seems to have been the position from the time the property was
allegedly handed over to the defendant.
We shall, therefore, assume that the payment started in 1974 when the
defendant was given the property in question.
It is in evidence that the defendant stopped paying the rates in 1996.
Stoppage and Default of
payment of rates: 1996-99
The defendant does not dispute the fact
it stopped paying municipal rates in 1996.
This state of affairs continued up to the year 2000.
During hearing the defendant purported
to show that it defaulted in the payment of rates because during the period
1996-2000 the Municipality Assembly had no councillors that would have
authorised collection of municipal rates.
The plaintiff maintained that it had
legal authority to collect the rates since the secretariat was still in
existence notwithstanding the fact that there were no councillors.
The issue of councillors is not the only
ground upon which the defendant sought to bas its decision to stop paying
rates. This comes out clearly from the
defendant’s letter of 17th September 1999 which it wrote to the
plaintiff.[6] The defendant advised the plaintiff that it
had stopped paying municipal rates because it had no title to the property in
issue. Thus, so the contention went, the payment of municipal rates were made
in error for the buildings in question belong to the Malawi government.
The plaintiff sought the opinion of
Government on what the defendant regarding its reasons for non-payment of
municipal rates.
Government opinion
The Ministry of Lands, Housing, Physical
Planning and Surveys denied that the Government of the Republic of Malawi owns
the building and land comprising Chancellor College. Indeed, in its letter of 29th June 2000, the Ministry
of Lands, Housing, Physical Planning and Surveys advised both parties herein
that the properties occupied by Chancellor College were absolutely handed over
to the University of Malawi even though there has not been legal transfer of
the land on which Chancellor College was built. It was further said that the delay in the legal conveyance of the
land has been due to backlog of work within the Ministry of Lands, Housing,
Physical Planning and Surveys. The
Ministry went on to advise that as proof of the fact that the land and
buildings do not belong to Government the defendant does not pay rent or ground
rates.
The arrears
Despite the intervention and opinion of
the Ministry the defendant has continued to default in its payment of the
rates. The plaintiff on the other hand,
continued to issue invoices to the defendant in respect of the rates. As at 31st October 2000 the
municipal rates had accumulated to MK5,662,388.71 and they remain unpaid to
this day.
Resumption of payment of
rates
The defendant has since partially
changed its stance on the issue of payment of municipal rates. It advised the plaintiff of its intention to
resume payment of municipal rates but that it would not pay the arrears of
rates. Actually, on 7th
November 2000 the defendant wrote the plaintiff and advised that it would start
paying rates but only those rates as due from November 2000.[7]
This did not go well with the
plaintiff. It then, on 17th
November 2000, commenced these legal proceedings.
The above are the relevant facts that
this court found had emerged from the testimony of the witnesses on
record. The court now turns to deal
with the issues for consideration in this matter.[8]
Consideration of the issues
Constitutional and statutory
framework: Legal authority for demanding payment of municipal rates
The defendant has submitted in argument
that the plaintiff had no mandate to
levy municipal rates in question. It
bases this argument on the fact that the local government authorities were
dissolved in 1995 and remained dissolved until they were reinstated in
1999. The defendant further contended
that since there were no councillors, during the period when the said municipal
rates were assessed, there was no competent authority to decide whether or not,
and at what rate, municipal rates should be levied. Dr Mtambo of Counsel for
the defendant sought to rely on a decision of the High Court where it was
reportedly[9]
held that councils, now called assemblies, had no mandate to collect or revise rates in the absence of
councillors.
This court does not agree with the
submission of the defendant. I will
also demonstrate that the purported decision of this court in the so called
Malawi Congress Party case[10]
leads to an absurdity and must now be corrected.
It is well to note that every local
government authority has a constitutional responsibility to deliver essential
and local services to people over whom it has jurisdiction[11]. This responsibility can only be achieved if
the said local government authority is able to levy rates. To achieve this the Local Government Act has
given Assemblies the authority to levy rates[12]. This authority can not, however, be
delegated[13]. Further, it would appear that the statute is
silent on what should happen, as regards the levying of rates, where for one
reason or another there are no people to constitute an Assembly. Indeed, the same is true with the situation
where Assemblies are dissolved. This
creates an absurdity. Now the question
that comes to mind is should there be no levying of rates where members[14]
constituting an assembly are dissolved or
where for one reason or another there are no councillors to form part of an
Assembly? This court is of the view
that this lacuna creates a situation where the obligation of a local authority
to deliver services is rendered invalid if it were to be accepted that it can not levy and/or collect rates where
members of an Assembly are dissolved.
This is the case because local authorities do not cease to provide
essential services even where there are no councillors or members[15]
to constitute an Assembly. In my
judgment, the constitutional and statutory duty, on the part of the Assembly,
to provide essential services is a continuous one.[16] In point of fact, it is important to always
remember that there is a special relationship between a local authority and a
rate payer. This relationship entails
that the rate payer is obliged to pay rates and that the local authority has
the right to collect them and the obligation to use the proceeds for the
delivery of services.
As mentioned earlier, the local
authorities are obliged, under both the constitution and the Local Government
Act, to provide essential services to the residents of the Assemblies. This they have to do whether the body that
constitute an Assembly has been dissolved or not. Indeed, this court doubts if the legislature intended that rate
payers should not pay rates when members of an Assembly are unable to
constitute themselves as provided for in the Local Government Act.[17] In arriving at this decision the court was
alive to the fact that any interpretation of the Local Government Act that
results in invalidating the constitutional and statutory duty imposed on an
Assembly to levy and collect rates is
unreasonable and must be avoided. Such
an interpretation would in point of fact lead to an absurdity which must be
avoided at all cost. It is, therefore,
imperative that in interpreting any statutory provision pertaining to the
levying and collection of rates the court ought to favour an interpretation
that would lead to constitutional validity.
It has reasonably been possible, in my judgment, to interpret the
Constitution and the Local Government Act in a way that enables the Assemblies
to levy and collect rates. As stated
earlier the Assemblies are obliged to continuously provide essential services
to the residents of the Assemblies. The
court must bear in mind the duties of the Assemblies in this regard and must
interpret the provisions of the Local Government Act in a way that is
consistent with the obligations of the Assemblies.
For the reasons given above this court
finds and concludes that the plaintiff was legally entitled to levy and collect
rates on all the immovable property in the designated areas in the Municipality
of Zomba. This included the demand for
the payment of municipal rates the
subject matter of this action. Indeed,
it is important to remember that it is evidence that the Assembly instructed
the Secretariat to collect all unpaid rates due to the Assembly including all
unpaid municipal rates covering the period that councillors were not in office. This evidence, in my view, was not
discredited. In the light of this
finding it is not necessary to make any specific decision on the further
argument regarding the legality of the rate at which the municipal rates were
being levied. I am of this view because
the broad principle upon which this court has found the actions of the
plaintiff being legal has already been discussed. It is sufficient for the purposes of this judgment to mention
only that I do not think that it was fair on the part of the defendant to raise
this rate argument during submission.
The pleadings did not sufficiently raise the issue of the legality of
the rate at which the municipal rates were levied[18]. It is,
therefore, no issue that this court should explore and make its finding.[19]
Accordingly, it is not necessary for the purposes of this judgment to decide
whether the rate at which the municipal rates were levied was within the
law. The court will assume in favour of
the plaintiff it was, regard being had to the fact that it is not an issue that
arose from the pleadings that were exchanged between the parties herein.
Moreover, it will be important to
mention that the amount of rates payable has its basis in the value of the
property as reflected on the valuation roll.[20] Ratepayers have the right to object to the
valuation of the property.[21] However, once the value has been determined
and the objection procedure[22]
has run its course, the determination of the precise amount of the rate
liability is a matter of mechanical calculation based on the proportion of the
value of the property payable as rates.[23] The Assembly is entitled to make a surcharge
on any arrears of rates and the surcharge shall be calculated at four per
centum per month or part thereof[24].
Is the immovable property in
question assessable property?
As regards the question whether the
buildings in issue are assessable property this court finds that the answer is
in the affirmative. It is common cause
between the parties that the buildings in issue are within the Zomba Municipal
Assembly. Consequently, the buildings
are assessable property.[25]
Ownership and liability for
payment of rates
On the issue of ownership and liability
for the payment of rates on the assessable property herein the court received
two opposing submissions.
The plaintiff contended that the
properties belong to the defendant although there is no title deed. This ownership, so the submission of Mr
Mwala, goes, is confirmed by the letter[26] that the
defendant wrote to the Chief Housing Officer dated 8th September
1990 where the defendant confirmed that the Malawi Government ceded some of its
houses to the University of Malawi.
Further, the plaintiff argued that the defendant became the owner of the
property in issue at the time government handed over same to the former and
that it is only the conveyancing that has taken time.
Dr Mtambo has contended that to the
contrary the assessable property in question is not owned by the defendant but
that it is merely in occupation of the
premises. It is his argument that there
are no title deeds issued in favour of the defendant. This, in the view of the defendant, has meant that the defendants
are indisposed to legally and irrevocably dispose of an interest in the buildings
forming part of Chancellor College. The
defendant further submitted in argument that in light of this the defendant was
never assumed ownership of the buildings.
For this reason, it is argued on behalf of the defendant, it can not be legally required to pay any rates
on the assessable property the subject matter of this action. In support of this contention the defendant
sought to rely on the decision of this court in J.A. Siyani vs. Blantyre
City Assembly[27]. The court held that the responsibility to
pay rates was that of the Applicant (J.A. Siyani) and not his tenant. Indeed, in that case[28] Justice
Kumitsonyo, as he then was, said:
“I would like to make an
observation before I proceed further herein that the duty of paying City rates to the respondent to the
respondent rested with the applicant
at all material times. It was not the
responsibility of he applicant’s
tenant. After all ownership and title
in the property was in the applicant
and he was the bonafide landlord seized of the property in fee simple in possession. I am saying so because Counsel for the
applicant did argue before me that
the co-payment of the rates was not wholly the fault of the applicant. Counsel
submitted that the applicant’s tenant was partially to blame. In my judgment
the lease agreement between the applicant and his Tenant was a totally different and separate transaction from the
agreement between the applicant
and the respondent by virtue of which city rates were to be paid by the applicant to the respondent. These two transactions must be treated separately and must never be
confused--”[29]
There are a few observations that need
to be made about this case. Firstly, it is important to note that the facts
obtaining in the Siyani case are distinguishable from the present
case. The court had to determine
whether as between a landlord and tenant who was liable to pay city rates. As will be seen shortly, in the matter at
hand there is no landlord and tenant relationship. Moreover, it is not known if in the Siyani case the court
was dealing with the definition of owner as used under the Local Government
(Urban Areas) Act.[30] Furthermore, in Siyani case the
facts clearly show that the rate payer had not parted with ownership of the
assessable property.
Following the observations above the Siyani
case will not be helpful in determining who is the owner of assessable
property herein. The same is true with
regard to the issue of whose responsibility it is to pay rates on the property
this court is dealing with in this matter.
Turning to the instant case, it is the
further contention of the defendant that the buildings belong to
Government. It should, therefore, in
terms of Sections 85[31]
of the Local Government Act be liable for the rates payable on the buildings.
The above are the submissions that this
court received on the issue of ownership.
I turn to explore the issue.
As regards the issue whether the
defendant owns the assessable property herein, and therefore liable for the
rates payable on same, one need not look any further than the provisions of the
Local Government Act,1998. Indeed, when
determining this question it may be useful to set in full the relevant
provisions of Sections 87 and 62 of the said Local Government Act and find out
whether they shed light on who is regarded an owner of assessable property.
Section 87 of the Local Government Act
provides as follows:
“(1) The person who at the date the
rate becomes due is the owner of any assessable
property and shall be liable for the payment of the rate---
(2) In the absence of any agreement to
the contrary the owner shall be entitled
to recover from the former any rate paid by or recovered from him in respect of ownership of the property by
such former owner.”
It
will be observed from this provision that the responsibility to pay
rates rests on an owner of assessable property. Further, it is the view of this court that the stipulation
recognises the fact that a current owner may recover from a previous owner
rates that ought to have been paid by such previous owner.
The Section discussed above does not
define who is to be regarded as an owner of assessable property. You get that definition in Section 62 of the
said Local Government Act,1998. The
pertinent parts of the said Section 62 are in the following terms:
“For the purposes of this part (I.e.
Part VII-Valuation and Rating) - ‘owner’ means
the person, other than a mortgagor not in possessing, entitled with
or without the consent of any other
person to dispose of an interest in the property.” (emphasis supplied)
I must make two observations about this
Section. Firstly, it should be noted
that the Section does not mention title deeds.
Further, it neither says that the owner must be one who has title deeds
nor does it provide that the owner means a person whose name or interest is
registered in the Deeds Registry.
Secondly, the Section does not describe what sort of interest in the
property is capable of being disposed by the person who is supposed to be
liable for rates. In light of this
observation we must resort to extrinsic aids to interpret the meaning of this
Section. In this regard the court will
have to look at the meanings of some words that have been used in the
section. The words being referred to
are “dispose of an interest.”
The word “dispose”, where not limited by
context, is sufficient to extend to all acts by which a new interest (legal or
equitable) in the property is effectually created.[32] As I understand it, the context in which the word “dispose” has been used
has not been limited. Thus, the
interest being referred in the section includes both a legal or an equitable
interest.[33] Further, the word “dispose” means to sell,
give in exchange, pledge or otherwise hand over.[34]
In view of the meanings discussed above,
it is the understanding of this court that to dispose of an interest in the
property means no more than to transfer an interest. This could be a legal or an equitable interest. In the instant case the defendant has an
equitable interest which is capable of being disposed. The defendant acquired
this equitable interest at the time the buildings were handed over, and ceded,
to it. Indeed, the defendant will be
legally entitled to acquire a formal title.
It is not, therefore, surprising that the defendant has demanded and or
requested that it be given title deeds.
Is the land herein Government
land?
As regards the contention that the
immovable property herein belongs to Government, the court finds that that
argument does not have support at law.
Put simply, this court finds and concludes that this land can not be
government land. The position at law is
that Government land means all land which is occupied, used or acquired by the
Government and any other land that reverts to Government.[35] As I see it, there is no evidence to suggest
that the land in question is either occupied or used by Government. If anything it is a fact that the land is
occupied and used by a constituent college of the defendant. Further, there is no material presented
before this court to demonstrate that the land has since reverted to
Government. Indeed, there is no
evidence pointing to the fact that having disposed of this land in issue to the
defendant the Government made another disposition in connection with this
land. In point of fact, this court
doubts that Government would do that unless if it is to create a legal
interest. In my view it is most likely
than not that that legal interest would be in favour of the defendant which has
an equitable title to the lands in question.
In any event, from the letter written by the defendant to the Chief
Housing Officer, Government had ceded some land to the defendant.
The letter and its
implications
As has already been mentioned, in its
letter[36]
to the Chief Housing Officer the defendant alluded to the fact that some of the
land belonging to Government were ceded to it.
The defendant was complaining that the Malawi Housing Corporation had
converted or attempted to convert part of its property. In order to secure its equitable interest in
the property it then requested that it be given some documentation with a view
to having some title deeds.
Surprisingly, when the issue of payment
of rates is raised the defendant wants to pretend that it does not own the property
ceded to it by the Government. It then
wants to hide under the provisions of the Local Government Act and thereby
avoid paying rates. It wants to attempt to avoid paying the rates by resorting to the literal meaning of owner
as set out in Section 62 of the said Local Government Act. This amounts to abuse of statutory
provisions. The court must not allow
this to happen.
The defendant is well advised to pursue
the issue of title deeds and get them.
If it wants the assistance of the court it may pursue that avenue. It must not pursue the issue of title deeds
but at the same time want to evade payment of rates. The defendant will not be allowed to blow hot and cold at the
same time. Further, I wish to observe
that if the ownership argument, advanced by the defendant, is accepted then the
end result will be an absurdity.
Beneficiaries of essential services in Assemblies will avoid, indeed
evade, payment of rates on the pretext that they have no title deeds. As discussed above, this court is enjoined
to avoid an interpretation of a statutory provision that leads to an absurdity
or an interpretation that renders duties or obligations nugatory.
Further, it must be remembered that the
defendant acknowledges in its letter to the Chief Housing Officer that the
Malawi Government ceded some of its houses to the University of Malawi. The essence of this letter is that the
defendant is accepting that Government gave up possession of some houses and
transferred same to the defendant.
Indeed, the letter clearly demonstrates that the defendant is the owner
of the houses that were ceded to it but that it has no title deeds for the said houses.
Now is possession of a title deed the
only way one can prove that he/she is an owner of property or an interest in a
property. In my judgment ownership may
well be established by proof of possession.
Title deeds are only prima facie proof of ownership. Indeed, a title deed is merely a document
that evidences apparent ownership but does not necessarily signify full and
complete title or beneficial interest.
There is material before this court to
demonstrate that Government ceded some of its houses, and built houses which it
handed over, to the defendant.
Ownership in the houses is with the defendant who has possession of same
and not Government. The property can
not, therefore, be disposed by any
other person but the defendant. For
this reason, it is the defendant who must be responsible for the payment of the
municipal rates on those properties. It is so found and concluded.
The Exemption Argument
The defendant has submitted that even if
it were to be assumed that it owns the buildings in question some of them are
exempted from municipal rates in terms of Section 83(1) as read with Section
83(2) of the Local Government Act,1998.
The buildings, it says, exempted are those staff houses that have been
converted into off-campus student’s lodgings due to ever increasing student
population.
However, the defendant never pleaded
this exemption in respect of some buildings that had allegedly been converted
from staff houses into the said off-campus lodgings or offices. This court was not invited to decide on an
issue concerning exemption. The
pleadings bear testimony to this observation.
In light of this fact, that the issue of exemption does not arise from
the pleadings, nothing turns on the exemption argument. I consider the issue of exemption no
further. Put simply it is not necessary
for this court to make a specific finding of fact on whether the exemption
provided for in subsections (1)(e)[37] and (2)[38]
of Section 83 of the said Local Government Act. It is concluded thus since the pleadings do not raise the issue of exemption. The court can not, therefore, be allowed to
give its judgment on facts not pleaded.[39]
It will suffice though to put it here
that, although some evidence was offered to the effect that some staff houses
have been converted, no cogent evidence was adduced regarding how many such
houses have been so converted. The
defendant could only say about three staff houses that have been converted into
off-campus student’s lodgings at Chirunga.
There is no evidence of conversion into offices. Further, and in any event, the defendant
ought to have raised the issue of exemption before the expiry of
twenty-eight(28) days from the first day on which the rates became payable.[40] The defendant neither complied with the said
Section 76 of the Local Government Act (No. 42 of 1998 nor the now repealed
Local Government (Urban Areas) Act.
Moreover, even if the exemption argument was considered and accepted by
the Assembly that would not entail that the defendant should not pay the rates
levied on the buildings that were allegedly converted. The municipal rates levied on these
buildings would still have been paid. The rates would have been based on the
valuation appearing in the valuation roll or supplementary valuation roll.[41] This would of course have been subject to
the outcome of an appeal or objection raised in respect of the property the
subject matter of the appeal or objection.[42] In the event of prevailing in the appeal, or
objection, the defendant would have gotten a refund of the rates paid on the
exempted property.
For the reasons given above, the
exemption argument is dismissed.
The claim for interest
The court has noted that there is a
claim for interest on the arrears of municipal rates that are due from the
defendant. In the writ of summons the
rate of interest claimed is at current bank lending rate. The claim for interest at the said bank
lending rate is not repeated in the statement of claim. In the statement of claim the plaintiff is
merely claiming interest on the said arrears of municipal rates. It is trite law that a claim is considered
abandoned when it is indorsed in the writ of summons but not repealed in the
statement of claim.[43] The court, therefore, finds that the claim
for interest at the said bank lending rate has been abandoned. It will be assumed, for the purposes of this
judgment, that the plaintiff wants interest at no particular rate.
Further, the plaintiff has argued that
it is entitled to be awarded interest on the arrears of municipal rates because
same has been withheld by the defendant and the plaintiff has resorted to
litigation to recover the said rates.
The defendant’s argument on the question
of interest is simple. It is to the
effect that since the defendant is not liable to for municipal rates then the
issue of interest does not arise.
This court finds that the interest
claimed must not be awarded to the plaintiff.
The reason for this finding is not based on the argument of the
defendant but rather because the claim for interest was not properly pleaded.
It is the finding of this court that the
claim for interest is not properly pleaded because it only appears in the
prayer in the statement of claim.
Further, the defendant has not pleaded, in the main body of its
statement of claim, the ground or basis or the rate at which it is claimed. This is not in keeping with the rule as
records pleading interest.[44]
The plaintiff has not complied with the
said Order 18/8/9 (-21) of the rules of the Supreme Court. It can not, therefore, succeed on its claim
for interest on the outstanding municipal rates.
Legal collection costs
As stated earlier the plaintiff is
demanding that the defendant should be adjudged to pay the sum of
MK1,091,229.96 being legal practitioner’s collection costs.
The defendant has submitted in argument
that it is not liable to pay any legal practitioner’s costs. It is the view of the defendant that in
terms of the recent amendments[45]
the legal practitioner’s collection costs are payable by the plaintiff to its
lawyers. I do not agree with this
contention by the defendant.
However, this court accepts the argument
by the plaintiff to the effect that the amendment contained in Government
Notice No. 6 of 2002 does not apply to the instant case. The amendment came into effect on 13th
March 2002. The present proceedings
were commenced on 17th November 2000.
It is trite law that in the absence of
a provision to the contrary proceedings
began under an enactment which is later repealed and replaced will not be
affected by the repeal.[46] it is obvious that the amendment the
defendant is talking about came into effect after the plaintiff had commenced
the proceedings against it. Further, it
is to be observed that the costs pleaded were clearly made pursuant to an
earlier amendment[47]
that came into effect on 24th December 1999. The recent amendment of 2002 is, therefore,
not applicable to the case before this court.[48]
The plaintiff will, therefore, be
entitled to the legal practitioner’s collection costs claimed. The amount of
legal practitioner’s collection charges, at the rate of 15% provided for in the
rules, should be MK 849,358.30 and not the sum of MK 1,091,229.96 claimed by
the plaintiff.
Conclusion
The plaintiff has succeeded on all its
claims except the one in relation to the claim for interest. It is so adjudged. As regards costs it is ordered that as regards the cost of, and
occasioned in, these proceedings the plaintiff will be awarded two-thirds of
the costs. It will not get full costs
because, as seen above, it did not wholly succeed on its claims against the
defendant.
Pronounced in open Court this 12th
day of December 2003 at the Principal Registry, Blantyre.
F.E. Kapanda
JUDGE