ANALYSIS
APPLYING THE LAW TO THE FACTS
(2) Whether the court a quo erred in finding that the conditions precedent had been waived
As already stated, the effect of the Addendum to the contract was that certain works, by their nature and scope, could not be completed by 23 October 2017 when the conditions precedent satisfaction period was due to lapse. By signing this Addendum, the appellant must have waived, or, at least extended, that period beyond 23 October 2017.
The decision of the court a quo cannot be faulted.
(3) Whether Fictional Fulfilment Occurred
Fictional fulfilment is a doctrine that may be invoked under circumstances where a party to a contract deliberately frustrates the fulfilment of a condition stipulated in the contract.
In casu, the respondent submits that the appellant was guilty of such conduct with regards the financing arrangements. It invited the court a quo to deem the conditions to have been fulfilled in line with the doctrine of fictional fulfilment.
The invitation was accepted - and correctly so.
The respondent's sole witness gave evidence to the effect, that, various proposals for the financing of the project were brought to the table but the respondent showed disinterest and declined to engage the various would-be financiers, both local and foreign. The appellant's witness, one Fambi, confessed that he had no knowledge of the financing arrangements and how they had been handled. He told the court a quo that such arrangements were the preserve of the appellant's Chief Executive Officer.
The Chief Executive Officer was not called to give evidence.
For that reason, the evidence of the respondent's witness, one Chivhayo, was virtually uncontroverted.
It was on the basis of that witness's uncontested testimony, that, the court a quo found that the appellant had frustrated the implementation of the contract and invoked the doctrine of fictional fulfilment.
The appellant, in other words, could not be allowed to benefit from its wrong doing: see the dicta in Standard Chartered Bank Zimbabwe Ltd v Matsika 1997 (2) ZLR 389.
The case of Scott & Anor v Poupard & Anor 1971 (2) SA 373 sets out the factors to be established in order to invoke the doctrine of fictional fulfilment. The factors are:
(i) Non-fulfilment of the condition;
(ii) The defendant's breach of his duty, with an intention to frustrate the fulfilment; and
(iii) A causal link between the non-fulfilment and the defendant's intentional frustration of the fulfilment of the conditions.
The court a quo, in line with case law and the uncontroverted evidence of Chivhayo, found this an appropriate case in which the doctrine of fictional fulfilment should be invoked.
Its decision in this regard cannot be impugned.
(4) Whether specific performance should have been granted
The fourth issue is to do with the propriety of the decision of the court a quo in ordering specific performance.
The law on specific performance is well traversed.
In the case of Grandwell Holdings (Pvt) Ltd v Zimbabwe Mining Development Corporation & 3 Ors SC05-20, this Court remarked as follows:
“However, the right to claim specific performance is predicated on the concept that the party claiming it must first show that he or she has performed all his or her obligations under the contract or is ready, willing, and able to perform his side of the bargain. Even then, the court has a discretion, which should be exercised judicially, to grant or refuse a decree of specific performance. It follows, therefore, that the court's discretion should not be exercised arbitrarily or capriciously: see Minister of Public Construction and National Housing v Zescon (Pvt) Ltd 1989 (2) ZLR 311 (S), where, at 318G, this Court stated:
'The law is clear. This is a remedy to which a party is entitled to as of right. It cannot be withheld arbitrarily or capriciously.'”
In dealing with the question of specific performance, the court a quo was alive to the principles governing the grant or refusal of that relief. It correctly noted that each case must be determined according to its own circumstances, and that the court must exercise its discretion judiciously, without appearing to be making a contract for the parties.
In casu, it noted that the appellant had not placed any evidence before it showing the measures it took in its attempt to achieve financial closure. Its sole witness, Mr Fambi, was unable to shed any light on this crucial issue.
Resultantly, the court a quo correctly concluded that there was nothing to show that specific performance was unachievable.
On the contrary, Mr Chivhayo, the respondent's sole witness, had shown that the respondent could secure funding for the project, the procurement of funding being central to the implementation of the project.
The court a quo dismissed the appellant's assertions that the project is no longer viable. It held, that, any issues pertaining to the viability of the project, and the effect of the changes in the currency regime (as alleged by the appellant), must be left to the parties to take care of in terms of clause 5(i) of the contract.
In any event, clause 6 of the contract allows the parties to amend the contract should they so wish.
The court a quo made reference to an “Amended and Restated Contract” which would have seen the project being implemented in phases. The respondent had funding for the initial phase of 10MW. This contract was never signed, but, its existence shows that funding could be obtained.
At p47 of its cyclostyled judgment, the court a quo makes the following finding of fact:
“The point is that, the question of the unavailability of funding is clearly not an excuse going by the evidence that was placed before the court.”
That finding of fact cannot be impugned: see Hama v National Railways 1996 (1) ZLR 66.
Counsel for the appellant submitted, that, an order for specific performance would bring intolerable hardships on the appellant, as the appellant has no funds to implement the project.
We note, however, that Mr Fambi, the appellant's sole witness, did not say so in his evidence before the court a quo. Secondly, it is the duty of the respondent to source funding.
If there is any hardship to be borne at this stage, it has to be borne by the respondent and not the appellant.
The respondent has indicated that it is able to source funding for the project.
That being the case, there was no reason for the court a quo to deny the respondent the remedy of specific performance....,.
6. Whether the counterclaim was properly dismissed
The residue of the counter claim (after the abandonment of that part of it imputing misrepresentation to the respondent) relates to a refund due to the appellant in the sum of USD3,000,000. The amount had been advanced to the respondent to carry out pre-commencement works.
Through the testimony of Mr Chivhayo, the respondent resisted this claim on the basis that the pre-commencement works to that value, if not much more, was in fact carried out. For that reason, the respondent did not owe the appellant any money.
Mr Chivhayo relied primarily on the report of the joint visit to the project site, which showed that substantial progress had been achieved on the pre-commencement work.
On the other hand, Mr Fambi, the appellant's sole witness, was unable to substantiate the counterclaim because he did not have the material to do so, as such matters were the preserve of the appellant's CEO.
The CEO was not called to testify.
In the circumstances, the appellant failed to prove its counter-claim. The court a quo's decision to dismiss the counter claim cannot be faulted.
DISPOSITION
Despite counsel for the appellant's spirited efforts, the appellant's case is weak in three cardinal respects:
(i) Firstly, Mr Chivhayo gave detailed, factual evidence in support of the respondent's case. On the other hand, Mr Fambi, who gave evidence on behalf of the appellant, was literally at sea as he admitted that he had no useful information regarding the issues before the court. He referred all material issues to the respondent's CEO who was, surprisingly, not called to give evidence.
In essence, therefore, Mr Chivhayo's evidence was not controverted.
(ii) Secondly, the court a quo made a finding of credibility in favour of Mr Chivhayo. To all intents and purposes, therefore, the court a quo accepted the veracity of the evidence as given by Mr Chivhayo and rejected any evidence to the contrary.
It is trite, that, an Appeal Court will not lightly interfere with the findings of credibility of a trial court.
(iii) Thirdly, following from the above, the court a quo made findings of fact in favour of the respondent. There is no basis to interfere with those findings.
We are satisfied, that, the court a quo properly held that the contract between the parties was valid and extant and that same was properly amended by the Addendum to it which extended the period within which the conditions precedent should be fulfilled. It correctly found that its purported termination by the appellant was of no legal force or effect as such termination did not meet the requirements of the termination clause of the contract.
The court a quo exercised its discretion judiciously, in ordering specific performance of the contract, having found that the respondent was willing, and able, to source funding for the project.
In any event, no meaningful evidence was presented by the witness led by the appellant.
The witness was unable to lead satisfactory evidence with regards the appellant's counter-claim in the sum of US$3 million. The court a quo correctly found that the counterclaim had not been proved and proceeded to dismiss it.
In the circumstances, the appeal stands to fail. Costs shall follow the cause.
Accordingly, it is ordered that:
(1) The appeal be and is hereby dismissed.
(2) The appellant shall pay the costs of suit.
