A B Stores Chilumbu v Chaponda (Civil Cause No. 401 of 1999) [2017] MWHC 27 (24 January 2017);









A B STORES CHILUMBU .....................................................................................PLAINTIFF


G T CHAPONDA ....................................................................................................DEFENDANT



Mr. Godfrey Kambale, Counsel for the plaintiff.

Counsel for the defendants-Absent.

Mr. Chitsulo, Court Clerk.




This is an order on assessment of interest payable to the plaintiff resulting from the judgment of Chipeta J (as he then was) in favour of the plaintiff delivered on 11th November, 2013. The defendant did not appear during the assessment proceedings despite notice.


This is a long standing matter which entered the courts in 1999 and has dragged on for the past seventeen or eighteen years. Briefly according to page two of the high court judgment by Chipeta J, the matter arose from a failure to observe terms of agreement of sale in which the plaintiff sold his property title no. 346 situated at Chichiri in the city of Blantyre at a cost of MK470, 000.00 and to which through his employer then, Reserve Bank of Malawi, the defendant paid a total sum of M K325,000.00 and remained with unpaid sum of MK145, 000.00. At page 7 of his judgment the learned judge entered judgment for a debt of the remaining sum of M K145, 000.00 plus costs and further entered judgment for the plaintiff for interest on the sum of M K145, 000.00 at the rate of 1% above bank lending rate as from 1st of July, 1996 to date of payment. However this assessment was delayed as the defendant brought an application in the Supreme Court of Appeal to stay execution of the judgment of the high court, and further to dismiss the action for want of prosecution.

Consequent to the appeal in the Malawi Supreme Court of Appeal, Civil Appeal No.49 of 2015, Mwaungulu JA, on 4th of June, 2016, as reflected at page 13 of his judgment dismissed both the application for stay of execution and dismissal of action for want of prosecution hence these proceedings.


The major question for determination is how much interest is payable to the plaintiff?


The plaintiff paraded only one witness by the name of Terence Augustine Nsamala who under oath adopted the witness statement made by himself on behalf of the plaintiff and the exhibits attached thereto. He appeared before court as an expert witness and it was ordered that he produce and show to the court his credentials as averred below to which he obliged through counsel by the 30th of January, 2016.

That said, the witness statement in brief stated that Terence Augustine Nsamala of address Post Dot Net, P.O.Box E145 Blantyre is a freelance consultant specializing in Financial services. That he is a qualified accountant having graduated from the University of Malawi, Polytechnic in 1994. Becoming a member of the Association of Chartered Certified Accountants (ACCA) in 1998. He informed the court that he was hired by the plaintiff in the matter to do computations of interest as ordered by the court.

In brief he informed us that he obtained the schedule of interests used herein from the Reserve Bank of Malawi. The said schedule is the document marked as exhibits P1 which was previously referred to as" TAN 1" in his witness statement, and tendered as part of his evidence. This document indicated the interest rates from January 1994 to September, 2016.

That said he also tendered in evidence exhibit P2 previously marked as "TAN 2" in his witness statement. In general this was basically his computation of interest for the plaintiff dating from July, 1996 to 30th September, 2016.

As to the specific rate of interest applied, the plaintiff informed the court that the interest rate applied from 1st of July,1996 was National Bank lending rate as per exhibit Pl plus 1%. That this was up to the 11th of November,2013. He further stated that from 12th November,2013 to 30th September, 2016, the interest rate applied was 5% per annum. And that the total interest calculated was MK40,93 5,752.00.

The evidence was uncontested and I take it that facts presented are as put before court.


As rightly put by counsel for the plaintiff, the statutory law in this jurisdiction provides for award of interest under section 65 of the Courts Act, Chapter 3:02 of the Laws of Malawi. The same states as follows;

"Every judgment in civil proceedings shall carry interest at the rate of five per centum per annum or such other rate as may be prescribed."

Currently at least not to the knowledge of this court, the statutory interest on judgment still remains at 5% per annum.

That said, courts also in their equitable jurisdiction do award compound interest in certain circumstances such as fraud as well as from agreement, custom or trade usage. And I concur with plaintiff counsel on the justification for such awards of interest in Dannie Justine Kamwaza and Mabvuto Kasote t/a Kamwaza Design Partnership vs. Ecobank MSCA Civil Appeal N umber 45 of 2014, where the court stated as follows:

"It must be that in the normal cause of things, the reality, often misunderstood, is that money not paid when it is due or withheld must be at some obvious loss to the one entitled to it. It matter less, therefore, that the one holding the money does not actually invest the money or the one entitled to the money would not have invested it. It must be that, even without real proof, the court will assume that the money would have been invested by the one withholding payment or the one entitled to payment. The question therefore will always be whether those losses are pinned to the payment of simple or compound interest. It is a reality which, with modern and rampant inflation, that compound interest represents the real lossfor withholding money another is entitled to."

Further, I equally concur with plaintiffs' counsel on jurisdiction of the Court to award interest on debt and damages as being premised on a wider common law principle and equity. And that therefore statutes providing for interest rates in specific circumstances complement rather than substitute the common law as expounded in Dannie Justine Kamwaza and Mabvuto Kasote t/a Kamwaza Design Partnership v Ecobank (ibid)

Now reverting to the matter before us here, the scenario requires to be considered in two aspects. The first aspect pertaining to award of interest from the time when the cause of action arose up to the time of judgment. And the second portion is from the date of judgement to this date.

A look at Section 65 of the Courts Act shows that it does not apply to the first aspect but rather to the second. That is according to wording of s.65, it is every judgment to civil proceedings that attracts this interest. And in this matter judgment was entered on 11th of November,2013. And consequent it is this judgment that will attract this percentage. To be precise the period would be from 12th of November, 2013 to 30th September, 2016.

As to the period between 1st of July,1996 to 11th November, 2013, what applies is the position obtaining in the Dannie Justine Kamwaza case cited earlier on to wit the banking rate plus 1% above it calculated on the compound interest basis.

Coming this far and having looked at the schedule of the applicable rates and indeed the calculations as prepared by the expert witness of the plaintiff and as verified with the official website of the Reserve Bank of Malawi (www.rbm.mw) and as submitted by counsel I have no problem to agree that the figure suffices and I order the same to be paid out. For the avoidance of doubt, the sum ordered or indeed the sum payable is that of MK40, 935,752.00 as calculated by the consultant and as verified by this court as per the calculation sheets on the court file. I dare add in my order that judgment of Chipeta J (as he then was) said interest should be calculated and paid up to the time of payment. I am therefore mindful that at time of this order some months had accumulated after the original calculation giving us the initial sum had been done. I consequently order that if need be an addendum to the judgment if any be brought within 30 days of this order.

Costs for this action are to the plaintiff.

Ordered in chambers here at Blantyre this 24th day of January, 2017.


K Banda

Assistant Registrar