IN THE HIGH COURT OF MALAWI
PRINCIPAL REGISTRY
CIVIL
CAUSE NO. 847 OF 1999
BETWEEN:
JOSEPH MANYUNGWA ……………………….PLAINTIFF/JUDGEMENT CREDITOR
AFRICAN COMMODITY TRADERS…………DEFENDANT/JUDGMENT DEBTOR
AND
FINANCE BANK MALAWI LIMTED
BRANCH MANAGER ………………………………………………………………….. GARNISHEE
Chirwa,
Counsel for the garnishee.
This
is the garnishee’s application to set aside the garnishee order absolute herein
whereby the Finance Bank Malawi Limited, Blantyre Branch was ordered to pay to
the plaintiff/judgment creditor a certain sum of money from the sums of money
held by the garnishee on behalf of the defendant/Judgment debtor.
Mr Chirwa Counsel for the
garnishee swore an affidavit in support of the instant application. The garnishee order absolute was sought to
be set aside on two grounds:- namely that the defendant’s account with the
garnishee does not have any money to be attached by the garnishee order
absolute and that the Defendant herein is a company in receivership such that
it has not capacity to pay on its own.
Mr Chirwa exhibited to his
affidavit a statement of the judgment debtors’ account which shows a negative
balance as at December, 2002 when the Garnishee order was made absolute
herein. There was also filed
simultaneously a similar application to set aside the garnishee order absolute
by the receiver and Manager of the judgment debtor herein. That application was supported by an
affidavit sworn by Mrs Kanyuka Counsel for the receiver and Manager of the
judgment-debtor herein. She deponed
that she appears herein as counsel for the 2nd defendant the
receiver and manager of African Commodity Traders, Peter White.
The court notes that when an
application for a garnishee order nisi was granted in favour of the judgment
creditor herein there was only one defendant namely African Commodity
Traders. And that at no time was the
Receiver and Manager of the defendant herein made 2nd defendant or
party at all in the present action.
The effect of the above state of
affairs is that as far as this action is concerned the Receiver and manager of
the defendant/Judgment debtor is not a party to this action. And as such Mrs Kanyuka could not swear an
affidavit in the instant action on behalf of the Reciever and Manager where the
said Receiver and manager was never joined as and party hereto.
The court therefore in the
premises excludes the affidavit of Counsel for the receiver as well as her
summons. If the Receiver and Manager
wished to be heard then he should have proceeded as an interviewing party
herein see Practice Note 15/6/7 and 15/6/7A to the Rules of Supreme Court. The Court shall therefore only deal with the
contentions of the garnishee itself.
The court is satisfied upon a
perusal of the affidavit in support of the garnishee’s application that at the
date of the garnishee order absolute there was no money in the Judgment debtor
account. And that the judgment debtor
is in receivership and was in receivership at the time the garnishee order was
made absolute herein. These facts have
not been disputed by the judgment creditor herein who did not make an
appearance at the hearing of the present application despite being served with
notice of the same.
Mr Chirwa deponed in his
affidavit that the garnishee did not show cause why the garnishee order nisi
should not be made absolute because it thought that the Receiver of African
Commodity Traders would instruct his lawyers to do so. The court notes that it has jurisdiction
to set aside a garnishee order absolute even where the garnishee remained inert
and the order nisi was made absolute.
See O’brien vs. Killen (1914) 2 Ir. R 63 cited in Practice note
49/4/2 to the Rules of Supreme Court.
The court herein is therefore
perfectly entitled to hear the garnishee’s application notwithstanding its
failure to contest the garnishee order nisi due to the mistaken belief it held
that the receiver manager would contest the garnishee order nisi. Although the court notes that the mistake
was very unfortunate in the face of the clear wording of the order nisi that
the garnishee herein show cause why it should not be made absolute.
The law is clear on the effect
of a receiving order on a garnishee order.
Once a receiving order is made,
a receiver for debenture holders, even though appointed subsequently to the
garnishee order absolute, will obtain priority over the judgment creditor under
a garnishee order. See Norton
vs. Yates 1906 1 KB 112. Such that
where company is in receivership the
receiver shall have priority over the judgment creditor under a garnishee order
absolute with regard to all the moneys due and owing to the company in
receivership. The same is true in the
instant case.
And on the facts herein the
garnishee order nisi ought not to have been made absolute the judgment debtor
herein having already been in receivership.
On that score alone the court
sets aside the garnishee order absolute herein with costs to the garnishee.
The court shall not order any
costs to the 2nd defendant who it does not recognize as having
intervened herein or been joined as the 2nd defendant as such.
The court having set aside the
garnishee order absolute herein for the reason stated shall not venture to deal
with the other ground that the defendant had no money to be attached herein.
Made in Chambers at Blantyre
this 25th February, 2003.