The applicant is a duly registered company of 9 East
Court Road, Belvedere, Harare….,.
The applicant is the registered owner of Stand 3131
Dzivarasekwa Township which it sold to the late Farai Benjamin Njiwah in terms
of a Deed of Sale Agreement dated 26 February 1999. The buyer paid a deposit
and the balance of ...
The applicant is a duly registered company of 9 East
Court Road, Belvedere, Harare….,.
The applicant is the registered owner of Stand 3131
Dzivarasekwa Township which it sold to the late Farai Benjamin Njiwah in terms
of a Deed of Sale Agreement dated 26 February 1999. The buyer paid a deposit
and the balance of $2,260,000= was to be paid by way of monthly instalments
within 36 months and was to be paid on or before 1st March 2002.
Furthermore, the buyer had to pay the installments due to Beverly Building
Society as required by the applicant.
On 2 March 1999, the parties signed another Agreement of Sale
over the same property.
As fate would have it, Farai Benjamin Njiwah died on 28
August 1999 before he had paid up the purchase price. The respondent was
subsequently appointed executrix and continued making the payment in terms of
the Agreement of Sale.
In HC10165/04, the respondent, as applicant, sought an
order compelling the applicant, as respondent in that application, to transfer
the immovable property in favour of the Estate Late Farai Benjamin Njiwah.
The respondent in that case opposed the application. In
addition, the respondent filed a counterclaim seeking, among other things, the
confirmation of the cancellation of the Agreement of Sale, the eviction of the
now applicant and a claim for damages for holding over.
On the 20 January 2006, the application and counter
application were heard before CHATUKUTA J in HC10165/04. Rosemary Nyahuye was
represented by Mr. Mawere whilst Leo
Electrical Pvt Ltd was represented by Mr. I.E.G. Musimbe. After hearing counsel
the judge gave the following order:-
“It is ordered that
1. That the main application be and is hereby dismissed
with costs.
2. That the counter application be and is hereby
dismissed for lack of compliance with the Penalties Act.”
On the May 2006, Leo Electrical Pvt Ltd filed this court
application seeking the eviction of Rosemary Nyahuye from the property in
question. The applicant argued that it had now complied with the Contractual
Penalties Act [Chapter 8:04].
The respondent opposed the application contending that
she had made full payment for the property and that the applicant had still not
complied with the Contractual Penalties Act [Chapter 8:04] if at all it felt
the respondent had not paid in full. The respondent made a counter-claim which
was basically for the same relief as in HC10165/04 where she was the applicant.
The applicant opposed the counterclaim contending that
the respondent's claim had been dismissed on the merits and so was res judicata.
The respondent indicated that her application was not
dismissed on the merits. Her legal practitioners had not filed the heads of
argument and so were barred. The dismissal was thus because of the failure to
file heads of argument as a result of which the applicant was barred.
On 13 November 2006, the parties appeared before me to
argue their case.
It was apparent from their papers that they were not
agreed regarding what transpired when they appeared before CHATUKUTA J and on
the interpretation of the order issued on 26 January 2006. Neither party had
the reasons for judgment nor were the legal practitioners certain as to whether,
in fact, the matter was dealt with on the merits. Whilst the applicant argued
that its counter claim was dismissed because no personal service of the notice
to terminate the Agreement of Sale had been effected, the respondent contended
that it was because the applicant had not complied with all of the provisions
of the Contractual Penalties Act [Chapter 8:04]. As a consequence of the
obvious uncertainty, Mr. Musimbe, who appeared for the applicant, sought a
postponement so that he could furnish the court with the correct position after
obtaining a copy of the judgment in HC10165/04.
When the matter was reset, no such information was
furnished. Instead, Mr. Musimbe had renounced agency and Miss V. C. Maramba of
Thondhlanga & Associates was now appearing for the applicant. The same
question regarding the reasons for the dismissal of the application and counter
application in HC10165/04 was raised. As was the case before - no satisfactory
answer was given.
In as far as it is agreed that the applicant's counter-claim
was dismissed for non-compliance with the provisions of the Contractual
Penalties Act [Chapter 8:04], if the applicant is to succeed, it must show that
it has now complied with the provisions of the Contractual Penalties Act [Chapter
8:04]. Section 8 of the Contractual Penalties Act [Chapter 8:04] provides that
-
“8(1) No seller under an instalment sale of land may, on
account of any breach by the purchaser -
(a) Enforce a penalty stipulation or a provision for the
accelerated payment of the purchase price; or
(b) Terminate the contract; or
(c) Institute any proceedings for damages;
unless he has given notice in terms of subs (2) and the
period of notice has expired without the breach being remedied, rectified or
discontinued, as the case may be.”
Section 8(2) of the Contractual Penalties Act [Chapter
8:04] states that:-
“(2) Notice for the purpose of subs (1) shall -
(a) Be given in writing to the purchaser; and
(b) Advise the purchaser of the breach concerned; and
(c) Call upon the purchaser to remedy, rectify or desist
from continuing, as the case may be, the breach concerned within a reasonable
period specified in the notice, which period shall not be less than -
(i) The period fixed for the purpose in the instalment
sale of the land concerned; or
(ii) Thirty days;
whichever is the longer period.”
Section 8(3) of the Contractual Penalties Act [Chapter
8:04] provides that -
“(3) Without derogation from s40 of the Interpretation
Act [Cap 1:01], a notice shall be regarded as having being duly given to the
purchaser for the purposes of subs (1) -
(a) If it has been delivered to the purchaser personally
or to an agent chosen by the purchaser for the purpose of receiving such
notices; or
(b) If it has been posted by registered post to the
address chosen by the purchaser for the delivery of correspondence or legal
documents relating to the instalment sale of land concerned or, in the absence
thereof, to the purchaser's usual or last known place of residence or
business.”
Compliance with section 8 of the Contractual Penalties
Act [Chapter 8:04] entails that one would have given notice in terms of the
above subsections. Subsection 1 obliges a seller to give notice in terms of
subsection 2. Subsection 2 outlines the nature and content of that notice,
including what the notice must demand of the buyer. Subsection 3 provides for
the manner of service of such notice for it to be deemed valid. These are the
steps the applicant should have clearly outlined if it hoped to convince the
court that it had complied with all the provisions of the Contractual Penalties
Act [Chapter 8:04].
The notice that the applicant said it gave the respondent
after the High Court order does not seem to be the one envisaged under section
8 of the Contractual Penalties Act [Chapter 8:04]. That notice reads:-
“RE: NOTICE OF TERMINATION - STAND 3131 DZIVARASEKWA
TOWNSHIP-DZI SUPERMARKET
The High Court of Zimbabwe sitting at Harare ordered that
the letter of termination of the agreement of sale had to be served on you
personally. Accordingly, this letter serves as your further notice of
termination of the agreement of sale entered into between our client and the
Estate late B. Njiwah on 24 February 1999, as further read with the agreement
of sale by Global Property, of 2nd March 1999. The first breach is
in respect of your failure to pay off the outstanding balance due to our client
within 36 months. The second breach is in respect of your failure to timeously
pay off the mortgage loan repayment to Beverley Building Society, which were in
arrears and almost resulted in foreclosure proceedings by Beverley. Despite our
client giving you more than the required 30 days' notice to rectify such
breaches, you failed to do so. Our client thus hereby terminates the agreement
of sale.
This notice shall be served personally on you as required
by the High Court.”
It is my view that this notice is not in compliance with
section 8 of the Contractual Penalties Act [Chapter 8:04]. The notice envisaged
under section 8 of the Contractual Penalties Act [Chapter 8:04] is one
notifying the buyer of the breach and demanding that the breach be rectified
within a given period failure of which certain consequences will befall him.
Subsection 8(2) clearly states those requirements. The purported notice by the
applicant is a mere statement of what the applicant claims to have done by way
of advising the respondent of the breach and alleging that the respondent had
not rectified the breaches. Those letters said to have been sent to the
respondent advising of the breach and giving the respondent a period within
which to rectify the breaches are the letters or notices required to be
furnished.
Accordingly, I am of the view that even with a
benevolent interpretation of the court order in HC10165/04 the applicant has
not shown that it has complied with the Contractual Penalties Act [Chapter
8:04].