SCOTFIN LTD v HEWITT & ORS 1999 (2) ZLR 65 (H)

Flynote

Practice and procedure — execution — stay of — pending determination of counter-claim — whether a separate action brought c by defendant can be treated as a counter-claim for this purpose

Headnote

The plaintiff company brought an action against the defendants, seeking payment of a debt admittedly owed by the defendants. While agreeing that judgment would have to be entered against them, they argued that they could avoid the effect of the judgment since they had instituted a claim against the plaintiff for a greater amount than was being claimed by the plaintiff. The claim had been made in a separate action, and was not acounter-claim to the action brought by the plaintiff. In addition, the claim was brought as a result of a cession allegedly made to them by another company.

Held, that generally the attitude of the courts is that both claim and counter-claim should be adjudicated upon pari passu. Even where the claim is admitted, there should not be a separate judgment in respect of the claim in convention; this should wait until the counterclaim has been decided upon, in order to obviate the potential danger of conflicting findings if the case proceeds piecemeal.

Held, further, that in applications for summary judgment, where reciprocal claims between the parties exist, the proper course for a court to adopt, if the claim in convention is admitted and the counter-claim is unliquidated, is to enter judgment for the plaintiff in the sum admitted, but grant a stay of execution pending trial of the counterclaim. The question, therefore, was whether there was a counterclaim before the court.

Held, further, that a counter-claim, for these purposes, is a claim which the defendant could have instituted by way of a separate action, but it must be brought and filed by the defendants with the plea.

Held, further, that the action brought separately by the defendants was not a true counter-claim, since it formed the subject of a separate action which did not fall to be decided pari passu. This was not in itself decisive in determining whether a stay of execution should be granted. It would be open to the court to enter judgment for the plaintiff but grant a stay of execution pending the determination of the action brought by the defendants.

Held, further, however, that as the genuineness of the cession was open to question and itself had to be determined in the action brought by the defendants; as the defendants did not appear to be pursuing their claim with any degree of urgency; and as the plaintiff company was a well-established financial institution and the defendants would not be prejudiced if they succeeded in their claim against the plaintiff, this was not a case where a stay of execution should be granted.