Termination of Contracts and Notice of Cancellation re: Approach, Repudiation, Debtors Mora and Effect of Breach of Contract

HH14-09 : TENDAI MUZA vs CHRISTINA MUWIRIMI and FATIMA MURWISI and MUNICIPALITY OF CHITUNGWIZA
Ruled By: MTSHIYA J

On 17 April 2007 the plaintiff issued summons against the defendants claiming the following: “(a) An order that the plaintiff be declared the owner of Stand Number 14826 Unit 'O', Seke, Chitungwiza; (b) An order that the third defendant be ordered to cede rights, title and interests in House Number 14826 Unit 'O', Seke, Chitungwiza to the plaintiff; and (c) Costs ...

On 17 April 2007 the plaintiff issued summons against the defendants claiming the following:

“(a) An order that the plaintiff be declared the owner of Stand Number 14826 Unit 'O', Seke, Chitungwiza;

(b) An order that the third defendant be ordered to cede rights, title and interests in House Number 14826 Unit 'O', Seke, Chitungwiza to the plaintiff; and

In these proceedings the first defendant, who is late, is represented by Herbert Muwirimi, the executor of her estate.

The brief facts leading to the above claim are these:

On 18 July 2005 the plaintiff and the first defendant entered into an Agreement of Sale whereby the plaintiff purchased from the first defendant Stand Number 14826 Unit 'O' Seke, Chitungwiza (“the property”) for $80,000,000= (Eighty million dollars). The amount was paid in instalments, and, as at 27 November 2005, the full amount had been paid. Transfer of property, however, remained outstanding.

Notwithstanding the above Agreement of Sale between the plaintiff and the first defendant, on 16 March 2006 the first defendant, through another Agreement of Sale, sold the same property to the second defendant for $500,000,000= (five hundred million).

The property was then immediately transferred to the second defendant without the plaintiff's knowledge.

The above facts are common cause.

The plaintiff gave evidence in support of his claim. He confirmed the Agreement of Sale between him and the first defendant and stated that following full payment of the purchase price he took vacant possession of the property on 1 February 2006. He remains in possession.

The plaintiff said apart from requesting the first defendant, on three occasions, to attend to the transfer of the property, he had actually visited her at her rural home where upon she had promised to come to Chitungwiza to attend to the transfer. It was the plaintiff's evidence that when the first defendant finally came to Chitungwiza, during the first week of March 2006, she indicated that she was no longer willing to proceed with the sale of the property. This was so because her family members had objected to the sale of the property for the reason that it was a 'family house'.

The plaintiff's reaction was that he could only move out of the property if the first defendant bought him a similar property. He said he never agreed to the cancellation of the agreement. He also said there was never any suggestion of a top up. The first defendant, he testified, never advised him of the second sale of the property to the second defendant. He only discovered that the property had been transferred into the name of the second defendant through water bills which bore her name.

The plaintiff said the first defendant, in the company of the second defendant and her husband, visited him at the property during the second week of March 2006. It was then that the second defendant had disclosed that she had bought the property and therefore wanted him to move out. He refused to move out.

The plaintiff denied that he ever agreed to pay rent to the second defendant. He had paid the full purchase price and the property was now his. All what remained was transfer of the property to him. He denied ever receiving any reimbursement.

After his testimony, the plaintiff closed his case.

Herbert Muwirimi, the executor of the first defendant's estate, gave evidence, which, in the main, was based on hearsay. He said that the late first defendant was his aunt and was the owner of the property in dispute. He, however, only became aware of the contract between the plaintiff and the first defendant when he came to court. He was not aware of the second sale to the second defendant. All what her aunt had told him was that the plaintiff had not paid the 'top up'. He trusted that his brother, Onismus Muwirimi (Onismus), had accounted for all the money that had been paid by the plaintiff through him. The money was for the first defendant (i.e payments towards the agreed purchase price of $80 million).

Onismus Muwirimi, who was called as the last witness for the first defendant, testified that he was involved in the negotiations that led to the purchase of the property by the plaintiff. He said the first defendant was his aunt. He confirmed that an Agreement of Sale was signed between the plaintiff and the first defendant. The full purchase price of $80 million, including a top up of $2.5 million, was paid by the plaintiff. He said the 'top up' had arisen as a result of complaints from the first defendant's brothers who felt the price of $80 million was low.

Onismus Muwirimi, who was a close friend of the plaintiff, testified that her aunt's first legal practitioners, Messrs C Mutsahuni, Chikore & Partners had paid a refund of $82.5 million to the plaintiff. A receipt (exhibit 5) was produced. He, however, said the plaintiff had refused to accept the refund. The witness said he had told the plaintiff that because of his failure to pay the top up price, of $50 million, his aunt, the first defendant, was considering selling the property to someone else. Furthermore, his aunt's brothers were accusing him of conniving with him (the plaintiff) in order for the plaintiff to purchase the property at a cheaper price. He said when the property was finally sold to the second defendant, he did not disclose the first sale to her (the second defendant).

The second defendant gave evidence in support of the second sale of the property to her and was supported by two other witnesses. She confirmed that through a Mr Chihota, she had, in terms of an agreement of sale dated 16 March 2006, purchased the property from the plaintiff for $500 million. She said upon checking on ownership details with the Council, she had, within five days, proceeded to have the property transferred into her name before paying the purchase price. She also said she had not viewed the property since she had a general knowledge of the types of houses in the area. She had to move fast because she had been advised that there was also a soldier who was keen to pay more money for the property. She said she only discovered that the property had also been sold to the plaintiff after she had already transferred ownership to herself. The first defendant had only told her that a relative of hers was staying at the property.

The second defendant said one of her main aims in buying the property was to build a bigger house. She said that upon proving her ownership of the property to the plaintiff, he had initially agreed to pay $10 million per month as rental pending his final departure from the property. She said the plaintiff had, however, reneged on the rental arrangement.

Mr Livingstone Chituriro Chihota testified that he had indeed facilitated the purchase of the property by the second defendant. He said all negotiations leading to the purchase of the property by the second defendant had been conducted at his house, which was about 300 metres away from the property in issue. He said it was, however, not his duty to show the second defendant the property that the first defendant was selling. He said that his only duty was to find a buyer for the first defendant. Once he had found a buyer he sent Onismus Muwirimi for the first defendant, with the second defendant paying for Onismus's transport to the rural area to fetch the first defendant.

Clement Nhau was called as the last witness for the second defendant. He said the second defendant was his wife and that he had been present at Livingstone Chituriro Chihota's house when the purchase of the property was discussed and concluded. Like the second defendant, he also confirmed that they had not seen or viewed the property. He and the second defendant had been told that there was a soldier who was also interested in buying the property. He said, as a result, moving with speed became necessary in order not to lose the property. In the main, his evidence corroborated that of the second defendant.

In order to put all the evidence and submissions from the parties' legal practitioners in proper prospective, I think, in the face of the evidence now before me, it is necessary to restate the issues identified for trial at the pre-trial conference. The agreed issues were:

“1. Whether or not plaintiff was in breach of the contract between him and first defendant.

2. Whether or not the Agreement of Sale between the plaintiff and the first defendant was ever cancelled.

3. Whether or not second defendant is an innocent third party.”

Upon restating and evaluating the evidence of the plaintiff, counsel for the plaintiff submitted that the double sale situation had arisen as a result of greed on the part of the first defendant. He submitted that the plaintiff had paid the full purchase price in terms of the agreement. There was no dispute that the sum of $80 million had been paid.

Relying on Chimponda v Rodgriques and Others 1997 (2) ZLR 63, counsel for the plaintiff correctly submitted that it is the primary right of a wronged first buyer to have the remedy of specific performance unless there is some equitable reason disqualifying him/her from obtaining such a relief. He said, in casu, there were no special reasons/circumstances militating against the plaintiff's right to specific performance.

Counsel for the plaintiff submitted that the second defendant had conducted herself in a suspicious and questionable manner and hence leaving room for one to conclude that she was aware of the first sale i.e the sale of the property to the plaintiff. That being the case, counsel for the plaintiff argued, the second defendant's remedy was in an action for damages against the estate of the first defendant i.e the seller of the property. All in all, counsel for the plaintiff's position was that the plaintiff's rights under the contract entered into between him and the first defendant should be enforced by this court.

Counsel for the first defendant also cited the case of Chimponda v Rodgriques and Others 1997 (2) ZLR 63 and submitted that in a double sale situation the basic rule is that, in the absence of special circumstances, the first purchaser should succeed. Also relying on Guga v Moyo and Others ZLR 2000 (2) 458 (S), she went on to state that the special circumstances to be looked at are:-

“(i) Who has paid more money than the other.

(ii) Who has taken possession of the property and expended considerable sums on the house.

(iii) Whether first purchaser took any action to protect his interest when he became aware that the seller was behaving dishonestly.”

Counsel for the first defendant submitted that in casu the second defendant had paid more money than the plaintiff i.e. $500 million as compared to $82,5 million paid by the plaintiff. She said the plaintiff had, in any case, failed to protect his interest after being told, in February 2006, by his wife, that the second defendant was inquiring about whether or not the house was still on sale. She went on to say the plaintiff had also not reacted swiftly when told by officers at Chitungwiza Municipality that the file had been taken to the Head Office. She argued that such information should have indicated to the plaintiff that something was happening to the house. The plaintiff, she argued, did not, however, take prompt action to protect his interest. She concluded her submissions by urging the court to regard the second defendant as an innocent purchaser in whose favour the special circumstances should lie so as for her to be awarded the property.

Counsel for the second defendant submitted that the important factor to consider in a double sale was whether or not the second purchaser was aware of the first purchase of the same house. He submitted that at the time of the agreement to purchase the property and also at cession of rights, title and interest in the property, the second defendant was not aware or had no knowledge of the first sale. He said that the fact that the second defendant went on to purchase the property without seeing or viewing it could not be construed as conduct confirming that she had known of the first sale. In any case, he argued, the second defendant had given adequate explanation for her conduct. He said whereas the second defendant had protected her interests by quickly seeking transfer of property, the plaintiff had done nothing to protect his interests despite the fact that he had become aware of the first defendant's reluctance to proceed with the sale (i.e. through asking for a 'top-up'). Furthermore, counsel for the second defendant argued, the second defendant had paid more money than the plaintiff. He therefore submitted that the second defendant's case should succeed. The plaintiff, he suggested, could seek damages from the estate of the first defendant.

The facts in casu, in my view, clearly establish the existence of a double sale.

The first sale was completed on 27 November 2005 when the last instalment towards the purchase price of $80 million was paid by the plaintiff to the first defendant. The payment was in terms of the Agreement of Sale dated 18 July 2005. The issue of a top up only came some three months after the plaintiff had fulfilled his obligation under the contract. What remained to be done under that agreement was cession of rights, title and interest in the property to the plaintiff. The purported reversal of the Agreement of Sale, in March 2006, does not, in my view, invalidate the first sale.

The second sale was concluded on or before 16 March 2006 when the second defendant paid $500 million to the first defendant in terms of the agreement signed between the first defendant and the second defendant on that date.

In concluding that the evidence confirms the existence of a double sale, I am in the same vein stating that the plaintiff complied with his obligations under the Agreement of Sale dated 18 July 2005. The plaintiff did not breach that agreement. There was therefore nothing on which the first defendant could anchor cancellation on and worse still without notice.

In her plea filed of record on 6 July 2007, and prepared during her life time, the first defendant said she had cancelled the agreement between herself and the plaintiff because:-

“(i) He had failed to pay the full purchase price.

(ii) He chased away first defendant's lodger without her permission and he imposed himself on the property in question.

(iii) He started cutting trees at the house without permission.”

The above 'breaches' were never placed before the plaintiff.

The issue of a top-up amount is not mentioned anywhere in the pleadings. It was only raised during the hearing in court.

The plaintiff, who, I must say, I found to be a credible witness, denied that he had paid an additional sum of $2,5 million as a top up. He said the reason for the purported reversal of the agreement, as given him by the first defendant, was that the property “was a family house”. The family had therefore decided not to have it sold.

This does not tally with reasons given in the pleadings. The plaintiff had refused to accept a refund arguing that if anything, it was the first defendant's duty to get him a similar property.

Exhibit 5, showing the purported reimbursement of $82.5 million on 7 April 2006, through Messrs C Mutsahuni Chikore & Partners, throws mud in the first defendant's story.

The said legal practitioners are not mentioned anywhere in the pleadings, and, if indeed they had handled the matter one would have expected them to proceed against the non-rent paying plaintiff who had allegedly imposed himself on the property on 1 February 2006. That piece of evidence is suspect. I have, however, already indicated that as at 27 November 2005 the plaintiff had complied with the Agreement of Sale. He had, in terms of the agreement of sale, paid the only agreed and known purchase price of $80 million. Accordingly, in the absence of a breach, any purported cancellation of the agreement was of no effect. This finding disposes of the first two tissues; namely;

(i) Whether or not the plaintiff breached the agreement; and

(ii) Whether or not as a result of a breach the first defendant cancelled the agreement.

HH71-09 : AGRO CHEM DEALERS (PVT) LTD vs STANLEY GOMO and CITY OF HARARE and RONALD AJARA and THE REGISTRAR OF DEEDS
Ruled By: GOWORA J

It is trite that where cancellation is lawful and justified on account of breach it takes effect from the time that the innocent party communicates the breach to the defaulting party. For this proposition, see Bako Anor v Bulawayo City Council 1996 (1) ZLR 232…, wherein GUBBAY CJ stated the following dicta: “Thus, it is those ...

It is trite that where cancellation is lawful and justified on account of breach it takes effect from the time that the innocent party communicates the breach to the defaulting party. For this proposition, see Bako & Anor v Bulawayo City Council 1996 (1) ZLR 232…, wherein GUBBAY CJ stated the following dicta:

“Thus, it is those actions and events which occurred after 23 March 1992 to which regard must be had in determining whether the resistance to the cancellation was justified in law; for cancellation takes effect from the time it is communicated to the other party. See Swart v Vosloo 1965 (1) SA 100 (A) at 105 (G); Phone-A-Copy World-wide (Pty) Ltd v Orkin & Anor 1986 (1) SA 729 at 752A-C.”..,.

In Guardian Security Services (Pvt) Ltd v ZBC2002 (1) ZLR 1 (S), SANDURA JA considered that a period of twelve months before an innocent party decided to terminate an agreement based on the alleged breach of the same by the other party to the contract is not a reasonable period. In casu, more than a decade went by before the local authority decided to do something. Even then, its attempt to enforce its rights under the agreement cannot even be termed half-hearted. They are virtually non-existent….,.

It was contended, on behalf of Gomo, that an aggrieved party to a contract of sale has the option of not only cancelling an agreement of sale but also claim cancellation and restitution of what he has paid over or transferred under the contract.

In casu, cancellation was communicated more than twelve years after default occurred and there has been no effort on the part of the seller to claim re-transfer in the Stand. Apart from an excerpt from KERR, I was not referred to any authority to bolster the contention that after the transfer of real rights to it, Agro Chem could be compelled to re-transfer the Stand on the basis of a breach which occurred prior to the registration of real rights in its name….,.

It is a correct statement of the law that a seller has an option to cancel and to claim restitution of the merx, even where there has been delivery. The question I posed to counsel for the first respondent was whether in fact a seller, after having transferred land and authorized its registration in the name of the purchaser can cancel the contract and obtain re-transfer. I have not been pointed to any authorities on the issue in point. The only authorities I have had occasion to read are those where either movables were the subject of the sale, or, if an immovable was the subject matter, then cancellation would be before transfer of rights to the purchaser.

In this regard, I have been invited to look at the conditions of the agreement by Gomo, which conditions he contends were not performed by Agro Chem. It was contended, further, that the court in casu could not ignore the Agreement of Sale as it recorded the intention of the parties vis-à-vis the transfer. It is further contended that the election to claim rescission of a contract and the return of the thing sold is available to a seller where the contract contains a clause (a lex commissoria) providing for rescission in the circumstances in question….,.

Indeed, the agreement which gave rise to this application does contain a clause for rescission, but the local authority, apart from the letters I have mentioned above, has not sought to have the sale set aside and the property re-transferred to itself.

In any event, the Agreement of Sale was antecedent to the transfer and once transfer is effected the court cannot revert to the agreement except in certain exceptional circumstances not pertinent to this dispute.

HH41-08 : ZODELLA ENTERPRISES (PVT) LIMITED vs LUXMORE NDENDA
Ruled By: GOWORA J

The plaintiff is a duly registered company trading under the name Borrowdale Motor Sales. As the trade name suggests, it, the plaintiff, trades in motor vehicles. On 6 June 2006, the plaintiff entered into an agreement with the defendant, in terms of which the plaintiff agreed to purchase a vehicle owned by the defendant, to wit, a ...

The plaintiff is a duly registered company trading under the name Borrowdale Motor Sales. As the trade name suggests, it, the plaintiff, trades in motor vehicles.

On 6 June 2006, the plaintiff entered into an agreement with the defendant, in terms of which the plaintiff agreed to purchase a vehicle owned by the defendant, to wit, a Ford Taurus registration number 720-532L. A copy of the agreement, which is attached as Annexure A to the summons, reveals that the purchase price of the vehicle was $700,000= (revalued) payable as to a deposit of $300,000= and the balance payable in two installments of $200,000= each within a further period of five months.

In its declaration, the plaintiff avers that it paid the deposit of $300,000 and a further sum of $200,000 being the first instalment. The plaintiff further avers that on tendering the remaining instalment to the defendant, he, instead, made a verbal offer to buy back the vehicle from the plaintiff and that as a result a verbal agreement was concluded for the defendant to buy back the vehicle for the price of $3 million. The plaintiff avers, further, that the defendant breached the verbal agreement by paying a total amount of $570,000 instead of the agreed sum.

The plaintiff has therefore claimed for an order cancelling the verbal agreement with the defendant, and, further to that, for an order that it pay back the sum of $770,000 to the defendant being a reimbursement of the $570,000.00 paid under the verbal agreement by the defendant and the sum of $200,000 being the balance of the purchase price of the vehicle in terms of the written agreement concluded by the parties on 6 June 2006.

The defendant, in his plea, denied that the plaintiff was entitled to the relief being sought, and, instead, averred that the plaintiff had not performed its obligations in terms of the written agreement and has averred that the plaintiff breached the written agreement by failing to pay any of the installments due under the written agreement. Due to such breach, the defendant avers that the parties agreed to terminate the agreement on condition that the defendant would pay back to the plaintiff the sum of $570,000 and the latter would return the vehicle to the defendant.

The defendant further avers that he duly paid the agreed amount to the plaintiff but that the plaintiff refuses to return the vehicle. The defendant therefore has filed a counter-claim in which he prays for the return of the vehicle and payment of damages for unjustified enrichment in the sum of $800,000 for use of the vehicle and for the value lost on the use of the $570,000.

The plaintiff purchased the vehicle from the defendant and paid a deposit of $300,000 upon signature of the agreement. Subsequently, additional other sums, which the plaintiff puts at $200,000, were paid. The defendant puts the amount at $100,000 which amount he states is the first breach by the plaintiff of the terms of the written agreement.

The plaintiff has produced vouchers which bear the signature of the defendant and states that the defendant did receive the amount of $200,000. The defendant denies that he signed the vouchers although admitting the signature to be his.

The plaintiff then claims the existence of a verbal agreement in terms of which the defendant would repurchase the vehicle at a stipulated price. The plaintiff claims that the defendant breached the agreement and therefore prays for its cancellation and payment to the defendant of monies not paid under the first agreement and a refund to the defendant of monies paid under the second agreement.

Most of the facts are common cause. The dispute relates to the payment of the instalments by the plaintiff due on the written agreement.

It is common cause that the parties entered into a verbal agreement in respect to the vehicle, and the question for determination is what the terms of that verbal agreement were. Each of the parties has a version which differs from the version rendered by the other.

At the commencement of the trial the parties agreed to some of the issues agreed to at the pre-trial conference and captured in a joint pre-trial conference minute filed by them. The only issues left for determination at the trial were the following therefore:

(a) What were the material terms of the verbal agreement between the parties?

(b) Whether the defendant breached the verbal agreement by failing to pay the deposit timeously?

(d) Whether the defendant has suffered any damages and whether the plaintiff is liable to the defendant in the amount claimed or any other sum at all?

There were no issues to be decided on the written agreement, but, in the presentation of their evidence, it would seem as if the parties were focused on issues mainly to do with the written agreement.

The defendant, in its counter claim, alleges breach of the agreement by the plaintiff and denies the existence of a verbal agreement involving a buy back of the vehicle. The plaintiff, in turn, claims ownership of the vehicle based on the written agreement.

If the plaintiff premises its claim on the written agreement, the dispute, it appears to me, cannot be resolved without an examination, at the outset, of what the terms of the written agreement were and what rights the parties retained in the vehicle pursuant thereto.

It is clear, therefore, that the terms of the written agreement then are an issue for determination as to whether the defendant is entitled to a return of the vehicle or if ownership, by virtue of the agreement, vested in the plaintiff.

I propose to deal with the matter by examining each of the issues in turn based on the evidence adduced by the parties.

What were the terms of the written agreement?

The pertinent terms of the contract are contained in clause 2 of the written agreement. The clause is in the following terms;

“2. The parties have agreed on the following terms:

(i) The first agreed deposit payable on signing of this agreement shall be $300,000,000= (old currency) (Three Hundred Million Dollars) shall be paid in cash i.e.

(a) $192,000,000= directly to Legacy Financial Services, No.13 Van Praagh Avenue, Milton Park, Harare to clear a debt incurred with them by Mr Ndenda; and

(b) A cheque in favour of Old Mutual Properties for $50,000,000=. The balance of $58,000,000= shall be paid in cash to Mr Ndenda on the day of signature of this agreement.

(ii) The balance of $400,000,000= shall be paid at a rate of $200,000,000= (two hundred million dollars) after the first two weeks and the last payment from the third week of the second payment or at such time as shall be agreed by the parties and in a manner determinable and agreed and documented by the parties.

(iii) The parties to this agreement agree that ownership of the said vehicle shall pass on to the buyer on signing of this agreement of sale.”

The first two sub-clauses do not, in my view, require any examination as they are clear. They deal with the terms of the payment and it is obvious from the evidence of the parties that each of the parties understood the times within which the purchase price had to be paid by the plaintiff.

It is the clause providing for the passing of ownership that is at the root of the dispute.

Each of the parties is claiming the right of retention of the vehicle on the basis that it is the owner. Any rights that the plaintiff claims to ownership of the same can only have been acquired by virtue of the agreement of sale, and, specifically, clause 2(iii). The defendant, on the other hand, would claim that he owned the vehicle and that ownership of the same was not transferred to the plaintiff by virtue of the written agreement.

According to the plaintiff, the agreement in respect of the sale by the defendant of the vehicle to the plaintiff was a credit sale, and, as a result, bearing in mind the provisions of clause 2(iii), ownership passed when the agreement was signed and delivery made to the plaintiff.

In written submissions filed on its behalf, the plaintiff poses a further question as to whether, in the event that ownership passed on 6 June 2006, it would revert to the defendant assuming that the defendant has proved breach of the written agreement on the part of the plaintiff.

The defendant's view is however that the agreement was not a credit sale and that ownership did not pass to the plaintiff on delivery of the vehicle. It is accepted by the defendant that the agreement was not one for hire purchase. The stance by the defendant is that what was concluded was not a credit sale but a sale by installment and that, as such, ownership in the vehicle did not pass to the plaintiff until the full purchase price would have been paid. In his evidence, the defendant's stance was that ownership in the vehicle never passed to the plaintiff.

The defendant did not, in pleading to the summons and declaration filed and served upon him by the plaintiff, allege or aver that the agreement was an instalment sale governed by the provisions of the Act.

In the written submissions, the defendant accepts that ownership had passed to the plaintiff but that the agreement was cancelled due to breach on the part of the plaintiff.

This is one of those matters where the pleadings do not bring out clearly and concisely the facts upon which the cause of action is based.

It would have been appropriate for the plaintiff to have pleaded that ownership had passed in terms of the agreement of sale and the defendant would then have responded appropriately. The question of whether or not ownership had passed is central to the resolution of the dispute and should have been one of the issues extracted for trial. Unhappily it was not. However, with the defendant having accepted that ownership did pass, it then becomes necessary to determine if the agreement that was concluded was an instalment agreement as contended by the defendant.

In the written submission made on his behalf, it appears that a concession is made that ownership did pass but that the agreement, being an agreement of sale by installment, then, in the event of breach, the defendant would be entitled to the return of the vehicle.

The defendant has submitted that the court should tell the parties the nature of the agreement that they entered into. I take that to mean that the court is being asked to interpret the agreement placed before it. It cannot mean that the court should, in such exercise, rewrite the contract for the parties.

The defendant seeks reliance on a passage from WILLIE and MILLIN's Mercantile Law of South Africa 16ed…, which is as follows;

“If credit is given for part of the purchase price on condition that the balance is paid in cash, the sale is one for cash and delivery does not pass the ownership. It is otherwise if the sale is on credit for there the ownership of the goods passes to the buyer on delivery to him though he has not paid the price.”

The passages quoted by counsel for the defendant refers to the cases decided in South Africa but I have not been referred to any authorities in this jurisdiction dealing with installment sales other than those governed by the Hire Purchase Act in our jurisdiction. At page 164 of their book, WILLIE and MILLIN's Mercantile Law of South Africa 16ed, the learned authors state:

“Installment sale agreements are defined as agreements of sale where ownership passes on delivery and the price is to be paid in instalments, two or more of which are payable after delivery, and the buyer is prohibited from alienating or encumbering the goods sold until the purchase price has been paid in full, or, the full purchase price becomes payable if the buyer alienates or encumbers the goods sold, or the seller is entitled to return of the goods if the buyer fails to comply with any one or more of the provisions of the contract: section 1.”

A closer reading of that passage leads me to conclude that the learned authors were discussing a section of the South African Hire-Purchase Act.

That passage cannot have the meaning ascribed to it by counsel for the defendant that any agreement within this jurisdiction where payment has been provided for in instalments is an installment sale as provided for by the Hire Purchase Act of South Africa.

As I have mentioned earlier on, our own Hire Purchase Act [Chapter 14:09] makes reference to instalment sale agreements. These are defined, in section 3 of the Hire Purchase Act, as follows;

“Instalment sale agreement means any contract of sale under which -

(a) The ownership in the goods sold passes either before or upon delivery; and

(b) The purchase price is to be paid in installments of which one or more are payable after delivery; and

(c) The seller is entitled to the return of the goods sold if the purchaser fails to comply with any of the provisions thereof;

and includes any other contract which has, or contracts which together have the same import, whatever form such contract or contracts may take.”

A perusal of the Hire Purchase Act reveals that it is meant to apply to specified agreements whose provisions are regulated by the Act. A feature of these agreements is that there should be reservation about the passing of ownership to the buyer. Whereas in an agreement for Hire-Purchase the purchaser obtains ownership after payment in full of the purchase price, in an instalment sale agreement, the Hire Purchase Act provides that ownership passes to the purchaser on delivery whether or not an installment has been paid. In the event of breach on the part of the purchaser the seller is entitled to return of the goods that are the subject matter of the sale.

It is the submission of counsel for the defendant that in defending the claim, by implication, the defendant claimed the return of the vehicle when the plaintiff failed to pay the last instalment.

I do not think that the submission can stand scrutiny.

The agreement executed by the parties did not provide that in the event of breach on the part of the plaintiff ownership in the vehicle would revert to the seller. Instead, the plaintiff was granted unreserved right to ownership upon the signing of the agreement. No conditions were placed upon the passing of such ownership and it is my view that the conditions upon which the parties intended to perform their contract is different to the conditions or provisions governing an installment sale agreement as stipulated in the Hire Purchase Act. In an instalment sale, even if ownership passes, there is a reservation on the passing of such ownership and the Hire Purchase Act provides for the seller to be able to recover the property which is the subject of the contract upon breach by the purchaser. I do not regard the agreement as falling in the category or form of agreements that are described in the Hire Purchase Act as instalment sale agreements.

The next question is whether this agreement can be termed a credit agreement as claimed by the plaintiff.

Neither of the legal practitioners who appeared before me was able to point me to an authority in this country where the court had to decide what constitutes a credit sale. I have not been able myself to find one within this jurisdiction.

According to CHRISTIE,Business Law in Zimbabwe…, the contract for sale does not always state whether it is for cash or credit so the law presumes that the sale is for cash, which presumption is not rebutted by the mere fact that the seller has made delivery without receiving immediate payment.

In casu, ownership was to pass to the plaintiff upon the signing of the agreement. It was therefore not a cash sale. The agreement itself does not, despite that ownership is to pass to the plaintiff upon signature, state that the agreement is one for credit or that the plaintiff has been given credit for the payment of the purchase price. In the absence of the parties having made specific averment as to whether or not the contract is one for credit, the court would have to examine the contract and deduce what the intention of the parties was.

I was referred to a plethora of authorities from South Africa. It is clear from the South African authorities that I have had to consider that the courts have not always found it an easy task to decide whether or not an agreement is one for credit or when it is that ownership is said to have passed. It appears that the matter first received attention from the courts in South Africa in the cases of Daniels v Cooper (1 E.D.C. p. 174), Sadie v Standard Bank (7 J. 87), and Quirk's Trustees v Assignees of Liddle & Co (3 J. 322) which are referred to in Laing v South African Milling Co. Ltd1921 AD 387.

I have not been able to access the earlier authorities. It would appear however that those cases are the ones that settled the law as regards sales on credit in South Africa according to the dicta in Laing v South African Milling Co. Ltd1921 AD 387. JUTA JA…, summarized the law thus:

“The authorities in our law were fully considered in the cases of Daniels v Cooper (1 E.D.C. p.174), Quirk's Trustees v Assigness of Liddle & Co. (3.J.322.), and Sadie v Standard Bank (7 J.87), and are to this effect; that, on a sale of movables followed by delivery the property does not pass until the purchaser has paid the money or secured the seller for the same, or, unless the sale is on credit. And there is ample authority for the further proposition that in the case of a sale where nothing is said as to ready money or credit and the goods are delivered to and taken away by the purchaser, the property does not pass; in other words, delivery to the purchaser and his taking away of the goods raise no presumption of the sale being on credit. On the contrary, the presumption is that the sale was for cash.”

Laing v South African Milling Co. Ltd1921 AD 387 was followed by the case of Eriksen Motors (Welkom) Ltd v Protea Motors, Warrenton and Another1973 (3) SA 685 AD, in which the court found that even though there had been delivery to the purchaser and payment had been made by cheque despite the fact that the seller was aware that the vehicle was being sold to another person by the purchaser, the sale was for cash and credit had not been given.

In a cash sale, payment of the purchase price is made against delivery of the merx and where payment is made by cheque, even where it is drawn against a Bank in a different town, it is a cash sale with payment being made only when the cheque has been cleared. Even in these circumstances if the cheque is not met the property does not pass.

On the other hand, a credit sale is one where the purchaser has been given time for payment of the purchase price, which time has been postponed for a substantial period. Where the period for payment has been postponed for an insubstantial period, the courts have held that the sale was for cash and not credit and that therefore ownership had not passed. The courts in South Africa have said that a period of ten days would be a reasonable period to hold that a sale is for cash where the seller has made no attempt to collect payment from the purchaser. A period in excess of that ten days is sufficient for the courts to find that credit had been afforded to the purchaser and that therefore the property had passed. The rule is based on the requirement in the Insolvency Act that an unpaid seller for cash must claim his goods within ten days of delivery.

In terms of our own Insolvency Act [Chapter 6:04] a seller who has not been paid in full after delivery, where the purchaser has gone insolvent, is allowed to reclaim his property if he has given notice within ten days of delivery to the insolvent or the trustee of his intent to reclaim his property.

The principles that have been stated by the courts, therefore, are to the effect that unless there is a specific provision to the contrary, every sale is presumed to be for cash - even where delivery has been made. Where the seller has not granted credit to the purchaser or has not accepted security for payment by the purchaser, the sale is for cash unless the seller has not given the purchaser a period which is not in-substantial for payment of the purchase price.

As to whether or not the seller wanted to pass ownership, the intention of the parties can be gathered from the facts.

Where the seller contracts for passing of the property to the buyer, where payment in full has not been made nor secured, then it is a sale on credit and ownership would pass upon delivery of the goods.

In an instalment sale, even if ownership passes, there is a reservation on the passing of such ownership and the Hire Purchase Act provides for the seller to be able to recover the property which is the subject of the contract upon breach by the purchaser.

In the instant case, the contract provided for the unreserved passing of the property to the purchaser upon the signing of the agreement by the parties. There can be no other meaning to be ascribed to the clause “that ownership shall pass to the plaintiff upon the signing of the agreement.” The wording is clear and unambiguous and this court cannot ascribe any other meaning to that clause. There was no provision for ownership to revert to the defendant in the event of any alleged breach on the part of the plaintiff. There was no provision for the seller to reclaim the vehicle in the event of breach on the part of the buyer. The features of the contract between the plaintiff and the defendant have all the hallmarks of a credit sale.

I can understand the difficulties that counsel for the defendant faced in trying to argue that it was a cash sale. It was not a cash sale.

As to whether it can be termed an instalment sale, I believe the onus was on the defendant to place before the court facts such as would make me conclude that what I had before me was such. That was not done.

Instead, what the facts show is an agreement where one of the parties sold his property to a buyer where the buyer was afforded an opportunity to pay the balance of the purchase over a period in excess of ten days. The only conclusion that the court can come to in such a situation is that the defendant wished to pass ownership to the plaintiff and I find that indeed ownership passed.

In so far as the first agreement is concerned, the defendant stated that he had not been paid for the second instalment.

The plaintiff has provided vouchers allegedly signed by the defendant when he was paid the $200,000 which was due under the second installment. The vouchers bear what the defendant confirms is his signature but he claims that the plaintiff superimposed his signature on a document which he had not signed. The documents that were tendered in evidence were all originals. The signature itself has not been disputed but the plaintiff did not adduce evidence to show how his signature was affixed to an original document.

I find that the documents are genuine and show that the defendant was paid in full for the second instalment.

In so far as the payment by the plaintiff of the balance of the purchase price is concerned, it is surprising that the defendant did not at any stage prior to the plaintiff bringing these proceedings ever call upon the plaintiff to rectify its breach - if it was in breach.

Despite such alleged breach, having delivered the vehicle to the plaintiff when the agreement was executed, the defendant never demanded the return of the vehicle until the plaintiff sued for the cancellation of the second agreement on the basis that the defendant was in breach thereof.

I turn now to the terms and conditions of the verbal agreement.

According to the plaintiff, the verbal agreement concerned the buy-back of the vehicle by the defendant. The defendant's position however is that because of the breach of the terms of the written agreement the parties agreed to cancel the written agreement and for the defendant to pay back the sum of $570,000 which was the total amount paid by the plaintiff and interest and for the return of the vehicle to him.

I have already found that there was no breach on the part of the plaintiff in paying the instalments under the written agreement.

It would therefore make sense for the plaintiff to state that the defendant offered to buy back the vehicle from the plaintiff at the increased price of $3 million, and that, as a result, an oral agreement was concluded whereby the defendant had to pay a deposit of $700,000. This is the only explanation for the deposit of $570,000 in the plaintiff's account by the defendant. According to the plaintiff's witness the deposit of $700,000 should have been made by the 17 July 2006. The defendant was given until 31 July to pay the balance on the deposit and when he failed the plaintiff cancelled the agreement between the parties.

In my view, the probabilities of the case favour the plaintiff's version.

It was in the business of selling vehicles and it would have no problems to sell back to the defendant a vehicle that had belonged to him. All it wanted was to make a profit out of the process. The version by the defendant that the amount deposited into the plaintiff was repayment of the amount paid by the plaintiff under the failed agreement of sale did not ring true.

On the defendant's version, the amount constituted repayment of the initial $300,000 paid by the plaintiff when the agreement was signed and another $100,000 which was paid instead of $200,000 as had been agreed. The additional $170,000 would then constitute interest. The defendant was unable to say what the rate of interest agreed was. As a result, he was not able to state with any conviction what the amount he had deposited represented.

It also turned up in the evidence that the plaintiff had in fact had the vehicle repaired and serviced. The plaintiff had required the defendant to pay for the costs of such repairs under the verbal agreement. The defendant admitted that the vehicle was indeed repaired and he had not reimbursed the plaintiff for the costs thereof.

It would be inconceivable, in my view, for the plaintiff to agree to an arrangement where it returns the vehicle to the defendant against a payment of $570,000. It would, at the least, demand that it be reimbursed for the sums expended on the vehicle, which, according to the evidence of the plaintiff's witness, were far in excess of $570,000.

The only verbal agreement entered into, in my view, is the one that the plaintiff told the court and the terms of which it was able to explain. The defendant was unable to state with certainty the terms upon which he was to have the vehicle returned to him by the plaintiff. He was unable to prove the existence of the verbal contract that he alleged had been formed by the parties….,.

Overall, I find that the version rendered by the plaintiff is to be preferred to the evidence of the defendant and I find for the plaintiff on all the issues. This means that the plaintiff succeeds in its claim and the counter-claim fails....,.

1. The verbal agreement concluded between the plaintiff and the defendant on 4 July 2006 be and is hereby cancelled.

SC21-09 : ZIMBABWE EXPRESS SERVICES (PRIVATE) LIMITED vs NUANETSI RANCH (PRIVATE) LIMITED
Ruled By: ZIYAMBI JA, GWAUNZA JA and GARWE JA

This is an appeal against the decision of the High Court dismissing with costs the appellant's claim for delivery of two hundred heifers and two hundred steers. The background to this matter is as follows; At the relevant time, Nuanetsi Ranch (Pvt) Ltd (“the respondent”) was one of the largest cattle breeders in the country. During 2003, the respondent ...

This is an appeal against the decision of the High Court dismissing with costs the appellant's claim for delivery of two hundred heifers and two hundred steers.

The background to this matter is as follows;

At the relevant time, Nuanetsi Ranch (Pvt) Ltd (“the respondent”) was one of the largest cattle breeders in the country. During 2003, the respondent experienced acute cash flow problems as a result of which a decision was taken, by management, to dispose of some of the cattle in order to raise money. On or about 7 May 2003 the respondent entered into a written agreement with the appellant in terms of which the respondent sold to the appellant a total of four hundred cattle consisting of two hundred heifers and two hundred steers. The purchase price was agreed at Z$450 per kilogram for the heifers and Z$500 per kilogram for the steers.

The appellant paid the agreed deposit of Z$15 million on 8 May 2003. In terms of the agreement, the balance of the purchase was payable “on Monday 12 May 2003 or after the animals have been weighed and delivered whichever occurs later.”

The cattle were not weighed by 12 May 2003, and, consequently, the balance was not paid by that date.

In June 2003, the respondent then advised the appellant that it could collect one hundred and twenty steers which the respondent said was equivalent to the deposit of Z$15 million previously paid.

At the hearing of the matter before the court a quo, the court found that the cattle had been weighed on 16 May 2003, and, that although the appellant had been advised of this fact no payment had been forthcoming despite numerous visits and telephone calls by the respondent's Managing Director. The court also found that the respondent had cancelled the contract and that it had done so by implication. Consequent upon these findings, the court a quo dismissed the appellant's claim with costs.

It is against this order that the appellant has appealed to this Court.

In its grounds of appeal, the appellant has raised various issues. These are that the court a quo erred:

(1) In finding that the cattle were weighed on 16 May 2003 and that the appellant was advised of this fact and the need to pay.

(2) In finding that the respondent cancelled the contract between the parties by implication.

(3) In not making a finding whether the respondent placed the appellant in mora.

(4) In declining to grant the appellant an order of specific performance.

I propose to deal with the first two grounds together as they are inter-related and arise from the same set of circumstances.

There is a dearth of evidence as to what happened exactly after the payment of the deposit of Z$15 million was made. The respondent says the cattle were weighed on 16 May 2003 after which the appellant was then advised of the fact. How the appellant was advised was never clarified during the trial. The witnesses who gave evidence for the respondent told the court a quo that the invoice was faxed to the appellant.

A copy of the fax slip was, however, not produced to confirm this.

The witnesses further told the court that the invoice had been sent by fax and the original by post and that one Betty Mudenge had done so. Betty Mudenge was not called to testify to this fact.

At the end of the day, therefore, all that was before the court a quo was an unsubstantiated claim that an invoice had been forwarded to the appellant on or about 16 May 2003.

On the basis of such evidence, the court a quo had no basis for finding that the invoice was forwarded to the appellant on or about 16 May 2003 and that the appellant, having seen the invoice, failed or refused to pay. Clearly, there was no such evidence before the court a quo.

There was evidence, however, that there were numerous visits and telephone calls by the respondent's Managing Director to the appellant's offices. I agree with the trial court that the cattle were in fact weighed at some stage and that, as a result, the respondent's Managing Director then made numerous calls in order to get payment.

It is unlikely that the respondent's Managing Director would have behaved in such a fashion if in fact the cattle had not been weighed. However, it is unclear when he made the calls or paid visits to the appellant's offices.

The evidence on record shows that what next happened was that the respondent wrote to the appellant on 12 June 2003. In that letter, the respondent advised the appellant that the deposit it had paid was equivalent to one hundred and twenty steers and that an invoice to that effect was attached to that letter. The letter was received and responded to by Mr D G Lupepe, the appellant's Managing Director. In his response, Mr Lupepe accepted the one hundred and twenty steers but rejected the suggestion that there should be a fresh quotation in respect of the remainder of the cattle.

I am prepared to find, on the evidence, that the cattle must have been weighed and the appellant notified on an unknown date but before 12 June 2003. The appellant, it is common cause, did not pay.

The question that now arises is whether the contract was properly cancelled.

It was the evidence of the respondent's Managing Director that the cancellation was implied from the letter of 13 June 2003. In other words, it was accepted that the respondent did not explicitly cancel the contract.

In its submissions, the appellant says cancellation by implication is unknown at law. The respondent disagrees.

It is clear that in its letter of 13 June 2003 the respondent was suggesting that it was prepared to let the appellant take delivery of one hundred and twenty steers against the deposit of $15 million previously paid. The remark by the respondent that “if you need more cattle, you are free to contact us and we give you a fresh quotation” suggests that the respondent considered, at that stage, that the contract was no longer in existence.

The appellant's immediate reaction was that the contract was still in force and that the respondent should comply with that contract.

The position is now settled that:

“Notice of cancellation must be clear and unequivocal and takes effect from the time it is communicated to the other party…,.”

R H CHRISTIE, The Law of Contract in South Africa, 3ed…,. See also Du Plessis v Government of the Republic of Namibia 1995 (1) SA 603…,.

A notice of intention to cancel must be such that the other party is or ought to be aware of its nature, but it is not necessary to use the word “cancellation.” The intention to cancel may be made sufficiently clear in other ways; KERR, The Principles of the Law of Contract, 4ed…,.

On the evidence, the respondent did not cancel the agreement in clear and unequivocal terms. Indeed, this is common cause. The respondent's evidence was that the cancellation was implicit from its letter of 13 June 2003.

In that letter the respondent wrote:

“Find attached your receipt for the 120 steers which you purchased from Nuanetsi Ranch. If you need more cattle, you are free to contact us and we give you a fresh quotation.”

This letter clearly implied that the contract was no longer in existence and that if the appellant required to purchase more cattle a fresh quotation would have to be provided.

Indeed, the appellant understood the letter to mean that the contract was no longer in existence, and, for that reason, wrote back to say that as far as the appellant was concerned the contract was still binding.

The question that now arises is whether, in law, a contract can be cancelled by conduct. Although the appellant has submitted that cancellation by implication is unknown to law, the question really is whether cancellation can be by conduct.

In Du Plessis v Government of the Republic of Namibia 1995 (1) SA 603…, the Namibian High Court accepted that a summons claiming damages was an implied notice of cancellation. The decision to cancel a contract may also be by conduct – see KERR, Principles of the Law of Contract, 4ed…,.

Indeed, repudiation of a contract by the defaulting party may be by words or conduct justifying cancellation by the aggrieved party; KERR, Principles of the Law of Contract, 4ed…,.

If the defaulting party can repudiate by words or conduct, surely, the aggrieved party should be able to terminate the contract by conduct too.

Suppose that the defaulting party has evinced an intention to repudiate the contract. Suppose too that the aggrieved party accepts such repudiation, and, by his conduct, clearly evinces his view that the contract has terminated. Would one not talk of termination in such a case? The answer, in my view, is in the affirmative.

As in all cases, the circumstances must be such that that is the only reasonable inference that may be reached. In such a case, I would have no difficulty in describing the contract as having been terminated by conduct.

Considering the circumstances of this case, I would have no difficulty in concluding that the respondent's Managing Director was in fact saying the contract had come to an end and that if the appellant wished to buy more cattle, then it would have to enter into a new agreement. I find, therefore, that the respondent did, in fact, cancel the agreement although it did not do so expressly.

The question that now falls for determination is whether the respondent lawfully terminated the agreement, and, in particular, whether the appellant had been placed in mora.

It is clear from all the facts of the case that the respondent was in financial dire straits and required payment as a matter of urgency. Clearly, therefore, this was a contract in which time was of the essence. However, since the cattle were not weighed by 12 May 2003, no time had been fixed within which payment had to be made.

In cases such as the present, the general rule is that:

“When the contract does not fix a time for performance there can be no mora ex re, only mora ex persona, so a demand by the creditor is necessary in order to place the debtor in mora…,.”

R H CHRISTIE, The Law of Contract in South Africa, 3ed…,.

The view has been expressed in several decided cases that no demand is necessary to place the debtor in mora when no time for performance was stipulated but it is clear that immediate performance was contemplated; R H CHRISTIE, The Law of Contract in South Africa, 3ed…,.

This view does not appear to correctly reflect the law as it currently stands. The present position is that:

“When no time for performance is fixed but time is of the essence, the debtor is not in mora and the creditor cannot cancel for non-performance unless a proper demand for performance has been made….,. The concept of time of the essence relates to the consequences of a breach and not to the breach itself, so if no time is fixed there can be no breach by non-performance, whether or not time is of the essence, until the creditor has informed the debtor when he maintains performance is due.” R H CHRISTIE, The Law of Contract in South Africa, 3ed…,.

In the present case it is clear that the appellant was never placed in mora.

The respondent proceeded to cancel the agreement but did not place the respondent in mora. In the circumstances, the contract was not lawfully terminated and therefore continued to subsist.

HH165-12 : MINING INDUSTYRY PENSION FUND vs FARTINGALE DESIGN (PVT) LTD AND LETINA UNDENGE
Ruled By: KUDYA J

The non-timeous payment of rent was a fundamental breach of the lease entitling the plaintiff cancellation of the lease agreement.

HB12-12 : KENNEDY GWAMURE vs DINGANI TSHUMA
Ruled By: NDOU J

On the notice of cancellation, it is trite that it must be clear and unequivocal and takes effect from the time it is communicated to the other party.

HB12-12 : KENNEDY GWAMURE vs DINGANI TSHUMA
Ruled By: NDOU J

A notice of intention to cancel must be such that the other party is or ought to be aware of its nature, but it is not necessary to use the word "cancellation." The intention to cancel may be made sufficiently clear in other ways.

HB12-12 : KENNEDY GWAMURE vs DINGANI TSHUMA
Ruled By: NDOU J

The fundamental flaw in the notice of cancellation in this case is that it was not communicated to the applicant. Instead, the respondent communicated it to his own agent who apparently did not communicate it to the applicant. In any event, the termination of mandate given to the agent was not communicated to the ...

HH03-09 : RACHEL MEYERS-MBIDZO N.O vs JOHN MARK CHIPUNZA AND REGISTRAR OF DEEDS
Ruled By: MTSHIYA J

Poor business decisions and greed cannot be allowed to interfere with the sanctity of contracts. The courts cannot, and should not, allow the sanctity of contracts to be destroyed by any factor that does not establish a breach of the terms of the contract.

HH03-09 : RACHEL MEYERS-MBIDZO N.O vs JOHN MARK CHIPUNZA AND REGISTRAR OF DEEDS
Ruled By: MTSHIYA J

It has become common, in our economic environment, for greedy parties in commercial/business transactions to manufacture imaginary breaches of contracts when trying to address sudden effects of inflation. That..., cannot be allowed. Parties are, in general, always aware of the conditions under which they are contracting and should therefore spell out necessary protections within their ...

HH40-08 : DHLIWAYO RODGERS vs SHAUN MANDAA KUDINGA
Ruled By: MTSHIYA J

This is an opposed application wherein the applicant seeks the following order:“1. The notice to terminate the lease agreement entered into between the applicant and the respondent on 28 August 2003 in respect of Number 5 Jacaranda Close, Hatfield, Harare be and is hereby declared null and void.2. The applicant ...

SC17-09 : ELIZABETH MUTIZHE vs LOVENESS GANDA and THE REGISTRAR OF DEEDS and FANNIE MUTIZHE
Ruled By: MALABA DCJ

Cancellation of a contract is lawful when it is in accordance with the terms and conditions of the contract between the parties. It is also lawful where there has been a repudiation of the contract which is accepted by the innocent party as a breach relieving him from future performance ...

HH93-09 : HAVEN CHIKUMBU vs BRYDEN TECHINICAL SERVICES (PRIVATE) LIMITED AND THE REGISTRAR OF DEEDS AND THE DEPUTY SHERIFF FOR HARARE
Ruled By: CHITAKUNYE J

It is also apparent that the reason for the cancellation is the change in price of the property the first respondent intended to buy after disposing of 5 McNab Street, Redcliff.

HH144-09 : NEGOWAC SERVICES (PRIVATE) LIMITED vs 3D HOLDINGS (PRIVATE) LIMITED AND GIFTCARE ELECTRICAL (PVT) LTD t/a REG ELECTRICAL WHOLESALERS
Ruled By: MTSHIYA J

The record shows that with effect from 1 February 2004, the plaintiff leased to the first defendant offices 5,7,8,9, and A1, Strathaven Shopping Centre, 17 Browning Drive, Strathaven, Harare. The lease was, subject to the agreed terms, renewable, and, indeed, the lease agreement remained in force until 8 April 2009 when the plaintiff, through its ...

“We act for Negowac Services (Pvt) Ltd.

Our instructions are that you lease from our client offices 5,6,7,8, and 9, at the aforementioned premises.

We are also instructed that, in breach of the agreement of lease with our client, you have failed to pay rent and operating costs from January 2009 to date.

Further, we are instructed that you have breached the agreement of lease by assigning your rights and obligations to a third party without the prior written consent of the landlord.

As a consequence of your breach of the agreement of lease with our client, we have been instructed to cancel the said agreement and recover the lease premises. In the circumstances, take notice that lease agreement is hereby cancelled. Further, we demand that you vacate the premises and handover the keys at our offices no later than end of business on Tuesday 14 April 2009.

In the event that you do not vacate he premises as stated above, we shall issue court process to recover the premises without further notice. The resultant legal costs will be for your account.

Yours faithfully

GILL, GODLONTON & GERRANS

Cc: Client-Attention Mr. Sibenke”

As can be deduced from the above letter, the reason for terminating the lease agreement was failure to pay rent from January 2009 to April 2009, and cancellation was effective from 14 April 2009.

On 14 April 2009, the first defendant, through its legal practitioners, responded to the plaintiff's letter, of 8 April 2009, in the following terms:

“We refer to the above matter in which we have been instructed by 3D Holdings to respond to your letter dated the 8^th April 2009.

Our client instructs that it has not failed to pay rent as alleged by your client. The real issue and dispute between the parties is the amount of rent payable. Our client proposed payment of rent in the sum of one United States of America dollar (USD1) per square metre, which was not accepted by your client. The rent payable was not agreed between the parties.

On the issue of assigning rights and obligations without the consent of the landlord, it should be noted that the tenant, 3D Holdings, did not change. It is the management of the tenant which changed, and, therefore, there is no assignment of any rights. It is also surprising that the issue is being raised now when the change of management took place in 2007, and rent was being paid to CB Richard Ellis by the new management.

In the circumstances, we are of the view that there is no basis at all for the cancellation of the lease agreement.

Yours faithfully

Mutezo & Company”

As can be seen from the second paragraph of the above letter, the first defendant raised the issue of a dispute of the rental payable.

The first defendant's letter prompted the following response from the plaintiff's legal practitioners:

“We refer to your letter dated 14 April 2009.

It is an express term of the agreement of lease that your client was obliged to pay rent monthly, and in advance. Failure by the parties to agree on an amount with regards to rent did not absolve your client from either paying the last agreed rent, or reasonable rent, since January 2009. Your client's failure in this regard is a clear breach of the aforementioned term of the agreement of lease.

In the circumstances, please note that the lease agreement remains cancelled on the basis stated above. We therefore demand that your client relinquish vacant possession of the premises forthwith and hands over the keys at our offices no later than end of business on Wednesday 23 April 2009.

Yours faithfully

GILL, GODLONTON & GERRANS”

On 8 May 2009, when the first defendant had refused to vacate the premises, the plaintiff issued summons by this court praying for the following relief -

“(a) Confirmation of cancellation of the lease agreement entered into between the parties for Offices 5,7,8,9, and A1, 3D Centre, Strathaven Shopping Centre, 17 Browning Drive, Strathaven, Harare.

(b) An order for the ejectment forthwith of the defendant together with its sub-tenants, assignees, invitees and all persons claiming through it, from Offices 5,7,8,9, 3D Centre, Strathaven Shopping Centre, 17 Browning Drive, Strathaven, Harare.

HH145-09 : TAKAVADA MAPFUMO vs PREMIER SERVICE MEDICAL INVESTMENTS (PVT) LTD AND DEPUTY SHERIFF AND RANGANAYI CHARLES MUBVUMBI
Ruled By: UCHENA J

The question to be answered is; would the first respondent have entered into the agreement if the applicant had not misrepresented the facts. In my view, it would not, because in terms of the agreement..., the agreement was premised on 50% of the price having been paid through deductions. No such deductions were made. The price ...

HH154-09 : PETHIAS CHITSUNGO vs D. MASUKU and RUWA LOCAL BOARD
Ruled By: MTSHIYA J

This is an opposed application where the applicant seeks the following relief:- “1. Applicant shall deposit $10,000,000,000= into the Registrar of High Court's temporary deposit account the outstanding balance towards the purchase price of Stand No.3519, Dzivaguru Crescent, Ruwa, for first respondent. 2. Thereafter, first respondent shall proceed to cede his rights, interests and title in Stand No.3519, Dzivaguru Crescent, ...

This is an opposed application where the applicant seeks the following relief:-

“1. Applicant shall deposit $10,000,000,000= into the Registrar of High Court's temporary deposit account the outstanding balance towards the purchase price of Stand No.3519, Dzivaguru Crescent, Ruwa, for first respondent.

2. Thereafter, first respondent shall proceed to cede his rights, interests and title in Stand No.3519, Dzivaguru Crescent, Ruwa, into applicant's name within ten (10) days of service of this order on him failure of which the Deputy Sheriff, Harare, be and is hereby authorised to sign all relevant cession papers for purpose of ceding first respondent's rights interests and title in Stand No.3519, Dzivaguru Crescent, Ruwa, into the applicant's name.

3. First respondent shall be evicted forthwith from Stand No.3519 Dzavaguru Crescent, Ruwa.

4. First respondent shall pay the costs of this application on client legal practitioners.”

In seeking the above relief, the applicant alleges that the respondent breached a contract relating to his purchase of Stand No.3519 Dzivaguru Crescent, Ruwa, (the property).

It is common cause that on 15 February 2008 the applicant and the first respondent entered into a written agreement whereby the first respondent would sell his rights in the property to the applicant for a sum of ZW$20,000,000,000= (twenty billion Zimbabwe dollars). The applicant paid ZW$10,000,000,000= (ten billion Zimbabwe dollars) upon the signing of the agreement. It was then agreed that the balance of ZW$10,000,000,000= would be paid over a period of three months.

On 21 April 2008 (i.e. 66 days after paying the deposit) the applicant tendered payment of the balance of ZW$10,000,000,000= but the first respondent refused to accept the payment arguing that he had since cancelled the agreement after the applicant refused to pay $3,300,000,000= on 15 March 2009, which payment, according to the first respondent, would have constituted the first instalment.

On 9 May 2008, the applicant filed this application praying for specific performance in terms of the draft order (relief) quoted in full herein…,.

On 9 July 2008, the applicant obtained a default judgment against the first respondent from this court, and, on the basis of that judgment, he caused the registration of the property into his name. However, the default judgment was later rescinded on 7 May 2009.

In opposing the application, the first respondent argued that the purchase agreement was not enforceable because it did not carry the consent of the lessor, namely, the Minister of Local Government and National Housing (the Minister) who was not even cited in the proceedings.

The first respondent based his argument on clause 12 of the lease agreement between himself as the lessee and the Minister as the lessor. The said clause provides as follows:

“That the lessee shall not cede or assign this lease or sublet or part with the possession of the stand/stands, or any part thereof, or alienate, mortgage, donate or otherwise dispose of the same, or cede or assign any right acquired by him/it hereunder without the previous consent in writing of the Lessor, or until title to the stand/stands shall have been granted to him/it as hereafter mentioned.”

The first respondent conceded that, although he, as the seller, had not complied with the above condition, the agreement between him and the applicant was not null and void. It was only unenforceable and would remain so until the Minister (lessor) placed him in a position to pass title. He, however, correctly argued that the Minister, who was not a party to the proceedings, could not be compelled to pass title to either of the two parties.

The first respondent argued that Ruwa Local Board, cited in the case as second respondent, was merely an administrative entity and could not take the place of the lessor who could pass title. It was further submitted that the second respondent had indeed confirmed that it would require authority from the Minister for it to pass title. The second respondent was not therefore compellable to pass title to the applicant.

The first respondent further submitted that when the parties concluded the contract their main intention was that the balance of $10,000,000,000= would be payable in three equal instalments over a period of three months. However, in breach of that arrangement, the applicant had, on 15 March 2008, upon demand, refused to pay the first instalment of $3,300,000,000=. The applicant had indicated that he would pay the whole balance at the end of the three months' period. That refusal to pay led to the cancellation of the agreement by the first respondent. The first respondent regarded refusal to pay the first instalment as a breach of contract justifying cancellation of the same.

On his part, the applicant submitted that upon payment of the balance of $10,000,000,000=, through the High Court, following the rescinded court order granted on 9 July 2008, he had fully discharged his obligations under the contract. He had initially tendered the payment on 21 April 2008 but the first respondent had rejected the same.

It should, however, be noted that notwithstanding the rescission of the court's order of 9 July 2008, on 7 May 2009, the applicant went ahead to register the property into his name.

The applicant averred that the refusal by the first respondent to accept the balance was due to the fact that he (the first respondent) wanted to fetch a higher price from an unnamed third party. He said the agreement did not spell out any specific instalments for the three months period. The first respondent could not therefore resile from a contract that was entered into freely and voluntarily. Payment had been made within the confines of the agreement and that payment was subsequently paid through the court.

The applicant agreed that although the agreement in question was legal it did not bind the lessor (Minister). See Jangara v Nyajuyamba 1998 (2) ZLR 475 (H) and Chanda v Mutandadzi and Anor SC74-94.

He said clause 12 of the lease agreement merely enunciated general policy. In the main, however, the City Councils/Local Boards are, on behalf of the Minister, the ones who approve of persons who are eligible to purchase or occupy any piece of land. The City Council(s) or local board(s), with authority from the Minister, can ratify what the parties will have concluded outside the non-cession clause. To that end, it was argued, it is the city councils/local boards that obtain the necessary authority for cession(s) from the lessor (in casu: the Minister). He said authority to cede would only be withheld where public policy would be injured.

In the premises, and because the applicant had fully discharged his obligations under the contract, it was argued, it would be unjust and inequitable for the court not to order specific performance. He urged the court to find the agreement legal and enforceable – hence his cry for specific performance.

In dealing with this matter, I want to take judicial notice of the fact that, generally, State land in municipalities is administered by local councils through delegated authority from the Minister. The lessee, for all practical purposes, dealt with the Ruwa Local Board which was mandated by the lessor (Minister) to approve developments on the Stand or property that was the subject of purchase. Ruwa Local Board was therefore the authorized agent of the Minister.

To that end, I do not see any prejudice in the non-citation of the Minister who appears in the lease agreement as the lessor.

Pursuing that argument, in any case, is now academic in the sense that, at the time of the hearing of this of matter, the second respondent had already exercised its delegated authority by effecting cession to the applicant.

It is important to note that the court order that was later rescinded was never challenged by the lessor. That, alone, is testimony to the fact that Ruwa Local Board is the authorized agent of the lessor.

The problem faced by both parties regarding their contractual relationship is the interpretation of the phrase “balance over three months from date of sale.”

There is no mention of what would be paid per each month. However, in his opposing affidavit, the respondent states the following:-

“5.4 Reference to payments “over three moths” was clear reference to the monthly instalments which were agreed by the parties.

5.5 I recall that on or about the 15^th of March 2008, I demanded payment of the first instalment Zimbabwean dollars. The applicant refused to pay the amount and indicated that he was to going to pay the amount at the end of three months period together with the subsequent instalments. I advised him that because of loss of value for money, I was not prepared to accept the full payment of 10,000,000,000= (ten billion) Zimbabwean dollars at the end of the three months period. I accordingly insisted on the payment of instalment. The applicant refused. As a result, I advised him that I was cancelling the agreement of sale.….,.

5.6 On or about the 15^th of April 2008, some two months after the cancellation of the agreement of sale, the applicant came to my residence and tendered the payment of the sum of $10,000,000,000= (ten billion) Zimbabwean dollars. I rejected the payment indicating that I had already cancelled the agreement of sale to his knowledge. That resulted in him writing the letter, which is attached to the applicant's founding affidavit papers, to the Ruwa Local Board. The said letter was however not copied to me.

5.7 I wish to point out that, originally, I had indicated to the applicant that the purchase of the property should have been made on cash basis. He negotiated with me and pleaded with me to accept a deposit in the sum of $15,000,000,000= (fifteen billion) Zimbabwean dollars. However, on the appointed day when the agreement was drafted, he came up with the sum of $10,000,000,000= (ten billion) Zimbabwean dollars. Initially, I had insisted that the balance which would have remained, in the sum of $5,000,000,000= (five billion) Zimbabwean dollars should have been paid within a month of the agreement of sale, that is by the 15^th of March 2008. On the date when the agreement was drawn up, it was after pleading of the applicant that I asked him to pay the balance spread over three months.”

As can be seen, the above statements attempt to introduce new terms to the agreement that the parties signed on 15 February 2008.

The statements, being outside the contract, are denied by the applicant. The applicant's position is that he would only be in breach if he failed to pay the balance within the three months period.

I agree.

The failure by the parties to incorporate the issue of instalments in the agreement, in my view, suggests that what was most important is that the balance should have been cleared within the three months period. The applicant could have paid any amount, even the total balance, before the expiry of the three months period. What the applicant could not do, however, was to effect payment outside the three months period.

That view is consistent with the need to restrict the interpretation of the intentions of the parties to the contents of the agreed document ie within the four corners of the contract.

Accordingly, my view is that the respondent lacked competence to cancel the contract on 15 March 2008 before the expiry of the three months period.

HB37-09 : MARGRET CAROL COLER vs MAXWEL SHUMBA
Ruled By: KAMOCHA J

At the trial, the parties agreed that there was only one issue for determination of the court, which was whether or not the cancellation of the agreement was in terms of the Contractual Penalties Act [Chapter 8:04]. In brief, the facts giving rise to this dispute were these. The plaintiff in this matter has emigrated to ...

In brief, the facts giving rise to this dispute were these.

The plaintiff in this matter has emigrated to New Zealand but she, by power of attorney, appointed one Herman Bannister to manage her affairs, property, and interests in this country.

Mr. Herman Bannister testified in this court.

His evidence was that the defendant initially rented the plaintiff's property, known as Lot 113 Hillside. As a tenant, the defendant's cheque relating to the deposit and first rental was dishonoured by his bank. When contacted about that, the defendant said that was a mix up, and ended up making a cash payment.

As time went by, the defendant offered to purchase the property. He offered one billion dollars, payable in ten equal instalments of $100 million dollars per mensem. The first instalment was payable by the end of April 2005.

The defendant's offer was acceptable to the plaintiff.

The defendant, however, failed to make the first payment by the end of April as agreed. The defendant struggled to pay the amount for two months but still failed to pay the amount he was expected to pay for the two months. When the witness confronted him about the payment, he simply told him that he did not have the money.

When the witness wrote to the defendant cancelling the agreement, the defendant filed a court application in case number HC 994/05. The witness handed the matter to his lawyers. Later, his lawyers presented him with a new proposal from the defendant, which he accepted.

The terms of the new agreement were that the defendant would pay $500 million by the end of September 2005 and the balance payable in ten equal monthly instalments. The defendant would pay a further $133 million over and above because he had failed to perform his part of the bargain.

The situation did not improve at all, as the defendant either made part payments out of time, or completely failed to pay in terms of the new agreement.

On 16 August 2005, a letter was written by the plaintiff's legal practitioners to the defendant's legal practitioners. The letter reads in part:

“Further to our letter dated 14^th July last, our client informs us that yours gave us a cheque dated 3^rd August 2005 for $12,000,000= endorsed to the effect that his bank should cash the cheque for Mr. Bannister.

Our client duly took the cheque to the bank and was informed by the cashier that there were no funds to meet it, therefore, it could not be cashed.

Your client is in constant default, and ours is not prepared to tolerate it any longer.

We hereby give you formal notice that unless your client pays arrears of rent totalling $16,000,000= plus $20,000,000= arrears of interest plus the balance amounting to $66,500,000= by the end of this month, our client will apply to court for an order cancelling the agreement of sale, and for the eviction of your client.”

The defendant was not moved by the contents of the above letter as he failed to honour his obligation by the end of August 2005. He did not end there, but went further and did not pay $500 million at the end of September 2005. The terms of a new agreement were contained in a letter dated 21 September 2005, written by the plaintiff's legal practitioners, addressed to the defendant's legal practitioners, in the following terms:-

“Our client has reluctantly agreed to give your client one more chance to pay what he owes, so please immediately send to our client, at 23 Chilam Court, which is just around the corner from your offices, the bank cheque for $102,500,000=, and also the cheque for $500,000,000= by the end of this month, and, in addition, $6,000,000= for the September rent, which should have been paid in advance.

When these payments have been made, your client will still owe the purchase price, and he will have to pay rent from the 1^st of October, at the agreed rate of $6,000,000= a month, and he will have to pay interest on the full purchase price of one billion dollars at the rate of 10% per month from the 1^st August, 2005.

If he makes the payments referred to above, he will still have to pay interest on the balance of the purchase price, Five hundred million, at the rate of 10% per month from the 1^st October 2005 until the full purchase price is paid, and he will have to pay rent at $6,000,000= a month until the date of transfer.

If your client defaults, the contract will be cancelled, and your client will get back the capital payments he has made, but none of the rent, and none of the interest, and our client will reserve the right to claim damages for your client's default.

Please confirm by return that the position is as stated above and immediately send the bank cheque for $102,500,000= directly to our client, and confirm that the other payments will be made when they fall due.” (emphasis added).

When confronted by Herman Bannister, he still had the audacity to say he had no money, but all the same did not want the agreement to be cancelled. Instead, he offered to pay a billion dollars in January 2006.

This prompted the plaintiff to instruct his lawyers to write to the defendant's lawyers in the following terms on 21 October 2005:-

“Your client is playing games

If your client wanted to acquire the property, he should have paid $500,000,000= on the 30^th September.

Our client is not prepared to grant any further indulgence, so we give you final notice that unless we receive $500,000,000=, together with interest, as agreed, from the 1^st August, by 9am on Tuesday the 25^th instant, the contract will be cancelled and your client will be evicted.

Please do not ask for further indulgence because it will not be granted.”

Needless to say, that, as usual, the defendant failed to meet the deadline. Instead, he sent a cheque for $400 million instead of $500 million, which was received by the plaintiff's lawyers after the deadline, on 26 October 2005.

The plaintiff's legal practitioners wrote a letter of cancellation that same day in these terms:-

“Your letter dated 24^th instant was delivered on the morning of the 26^th October, too late to comply with the deadline we had imposed.

We return your cheque and confirm that the sale has been cancelled.”....,.

There can be no doubt that the defendant is a perpetual defaulter. He seems to be a man of straw who wants to live far beyond his means.

The defendant had no witnesses at call, but he gave evidence.

His testimony was basically that he was not given sufficient time to rectify his breach. He accepted that he was in breach of the agreement, while contending that he was not given the required thirty days to redress the breach. He alleged that he was only given four days, which was contrary to what the law stipulated, which brings us to the sole issue that the parties wanted the court to determine.

HB46-09 : HERBERT SIKHOSANA vs ESTATE LATE A MTSANA and SHOWLAST NCUBE and NAPFUTALI SIBANDA and ZANELE NCUBE and NOKUTHULA MTHETHWA and ORS
Ruled By: NDOU J

The applicant is seeking an order in a draft in the following terms: “It is ordered that: (1) Upon tendering of the balance of the purchase price by the applicant, first to fifth respondents be and are hereby directed to take all reasonable steps necessary to effect transfer of Stand 3553 Emganwini, Bulawayo, into applicant's name. (2) In the event ...

The applicant is seeking an order in a draft in the following terms:

“It is ordered that:

(1) Upon tendering of the balance of the purchase price by the applicant, first to fifth respondents be and are hereby directed to take all reasonable steps necessary to effect transfer of Stand 3553 Emganwini, Bulawayo, into applicant's name.

(2) In the event that first to fifth respondents refuse to accept payment, the Deputy Sheriff be and is hereby authorized to accept the money on their behalf and proceed to sign all the necessary documents at 7^th and 8^th respondents' offices to effect transfer of Stand Number 3553 Emganwini, Bulawayo, into applicant's name.

(3) The 7^th and 8^th respondents be and are hereby directed to transfer Stand Number 3553 Emganwini, Bulawayo into applicant's name.

(4) First to fifth respondents are to pay the costs of this suit on an attorney-client scale.”

The salient facts of the matter are the following.

The first respondent is the estate of the late A Mtsana. The second, third, fourth and fifth respondents are the late A Mtsana's children.

During her lifetime, the late A Mtsana entered into an agreement with the applicant for the sale of a Stand yet to be identified by the late at a total cost of $18 million to be paid in fixed monthly installments. Only the second respondent was privy to this agreement, the third to fifth respondents were not.

As per the agreement, the first respondent secured Stand Number 3553 Emganwini, Bulawayo for the applicant. It is apparent from the annexures filed by the applicant that both the applicant and the late A Mtsana signed the agreement which stipulates that the price was varied to $100 million and that the Stand was then identified as 3553 Emganwini. The annexures A-C contain the agreement between the late A Mtsana and the applicant and it is in the following terms:

“27 September 2004

UHebert Mabunu Sikosana I.D. 08-282566 N 73 ubhadale i$2,000,000 eyestand. Cost $18,000,000. Balance $16,000,000.

S Ncube (signed)

A Mtsana (signed)

H Sikhosana (signed)

5 October 2004

Paid $3,000,000

Balance $13,000,000

S Ncube (signed)

H Sikhosana (signed)

A Mtsana (signed)

24 October 2004

Paid $2,000,000

Balanace $11,000,000

S Ncube (signed)

A Mtsana (signed)

7 November 2004

Paid $2,000,000

S Ncube (signed)

Balance $9,000,000

A Mtsana (signed)

Herbert (signed)

20/11/04

Paid $1,000,000

Balance $8,000,000

S Ncube (signed)

A Mtsana (signed)

11/12/04

Paid $1,500,000

Balance $6,500,000

A Mtsana (signed)

S Ncube (signed)

New Year 2005

19/01/05 Mr H Sikhosana

Paid $3,000,000

Balance $3,500,000

S Ncube (signed)

A Mtsana (signed)

8-03-05

Paid $2,000,000

Balance $1,500,000

S Ncube (signed)

A Mtsana (signed)

H Sikhosana (signed)

Sale of Stand No. 3553

Continued from 27 September 2004

$100,000,000

$16,500,000

Balance $83,500,000

S Ncube (signed)

A Mtsana (signed)

H Sikhosana (signed).”

It is beyond dispute that the late Mtsana and the second respondent signed against each payment that the applicant made. It is beyond dispute, from the foregoing, that the applicant and the late Mtsana signed for the variation. The only term varied is the purchase price which was increased from the initial $18 million to $100 million.

The late A Mtsana died in April 2005 when the agreement between the parties was still valid and effective. It was after the deceased's death, when the applicant went to make his payment, when the second to fifth respondents refused to accept the money and advised the applicant that they were now cancelling the contract prompting the applicant to seek redress in this court via this application.

In opposing this application, the third respondent then filed an opposing affidavit allegedly on behalf of the first to fifth respondents.

The opposing papers raised the following issues:

(a) The applicant has used the wrong procedure as he should have proceeded by way of summons;

(b) That the applicant has nothing against the respondents since he did not know the property he was purchasing at the time of contracting;

(d) That a new term of the contract was introduced at the time of the variation in terms of which the applicant was required to pay $40 million immediately upon signing the agreement and that he failed to fulfill this obligation...,.

3. Whether the proposed cancellation of the contract by the third respondent is valid

It is beyond dispute that in terms of section 2 of the Contractual Penalties Act [Chapter 8:04] [hereinafter referred to as the “Act”] the agreement in casu is an installment sale of land because it involves the sale of land in three or more instalments as evinced by the record of payment in the above mentioned annexures. In the circumstances, the contract between the parties must be terminated in terms of the provisions of section 8 of the Contractual Penalties Act.

Section 8 of the Contractual Penalties Act [Chapter 8:04] provides:

“(1) No seller under an installment sale of land may, on account of any breach of contract 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 for damages, unless he has given notice in terms of subsection (2) and the period of the notice has expired without the breach being remedied, rectified or discontinued, as the case may be.

(2) Notice of the purposes of subsection (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;

(ii) Thirty days;

whichever is the longer period.”

In casu, it has not been alleged nor contended by the respondents that they gave the applicant a notice to terminate the contract as required by the Contractual Penalties Act. In fact, no such requisite notice was given. At the time of the late A Mtsana's death the agreement was in existence and the alleged breach had already been committed and condoned by the deceased personally before her demise. She accepted the late, and sometimes inadequate, payments personally and went further on to sign the renewal agreement thereafter. This in fact amounted to condonation of the breach.

In the circumstances, the second to fifth respondents cannot retrospectively cancel the agreement on the basis of the same breach which the deceased herself condoned in her lifetime.

Accordingly, the purported cancellation is invalid – Preston v Choruma Blasting Co 1999 (2) ZLR 201 (S).

HB94-09 : NOMALANGA SIBANDA vs GIVEN NYATHI and SEHLISO NYATHI and THE REGISTRAR OF DEEDS, BULAWAYO and BEN BARON AND PARTNERS
Ruled By: KAMOCHA J

Not only does the purported cancellation fall foul of the provisions of the Contractual Penalties Act [Chapter 8:04] but it was also contrary to clause 8 of the Memorandum of Agreement, which provides that – “Should any party fail to remedy any serious breach of this agreement within fourteen days of demand to that effect, the ...

HH11-10 : NABANE ROY TSHUMA vs TONGAI MUSEMBURI and TENDAI MUSEMBURI and MACKSON TOTSHANE NCUBE and THE REGISTRAR OF DEEDS
Ruled By: KARWI J

Tendai Musemburi said the third defendant, who had been out of the country, returned on 13 April 1985. He said the third defendant gave them an extension of two months – up to 13 June 1985. They failed to pay in terms of the Agreement from the month of July to October 1984. This was because ...

Tendai Musemburi said the third defendant, who had been out of the country, returned on 13 April 1985. He said the third defendant gave them an extension of two months – up to 13 June 1985.

They failed to pay in terms of the Agreement from the month of July to October 1984. This was because they did not have money during that time. The third defendant did not raise the matter concerning the delay. They also failed to pay the amount of $21,375= which was supposed to have been paid by 31 March 1985. The $400= monthly payments which were required to have been paid by 31 March 1985 were paid late as well.

They got a letter from Scanlen & Holderness, who were acting for the third defendant, in November 1984, complaining about the delay. After receiving the letter of complaint, they paid on 10 December 1984.

In the meantime, they had applied to CABS for mortgage finance in order to fund the required balance of the full purchase price. They got a letter from CABS on 7 January 1985 which indicated that they only qualified for an amount of $18,525= because of their earning bracket. They did not advise the third defendant of this development as they wanted to reapply for the coming year since they had up to 31 March to finalize all payments.

They continued to negotiate with the third defendant for an extension of time.

It was Tendai Musemburi's evidence that they got a further extension from the third defendant up to 13 July 1985.

Tendai Musemburi said they got a mortgage bond on 12 July 1985. They were informed by CABS on that day that they had been granted mortgage facilities. They had been granted a mortgage of $19,874=, which left them with a shortfall of $2,824=. They took the CABS letter to a Mr. Tanser of Scanlen & Holderness, who advised them to take it to Gabriel Real Estate (Pvt) Ltd – which they did.

They were surprised to be advised by Mr. Gabriel that the third defendant had written to him advising that the Sale Agreement had been cancelled. The third respondent had written this letter on 11 July 1985.

This meant that the third defendant had cancelled the Agreement just a day before CABS had granted them mortgage facilities.

Tendai Musemburi told the court that in his letter of 11 July 1985, the third defendant referred to his letter to Mr.Gabriel of 20 June 1985.

Tendai Musemburi suggested to the court that the third defendant did not write the 20 June 1985 letter because the signatures of the said letter and the 11 July 1985 letter were different, and also that the 20 June 1985 letter did not get to Mr. Gabriel.

Tendai Musemburi further stressed that there were two letters which were purported to have been written by the third defendant on 11 July 1985. One was written from Bulawayo and the other on a Harare Housing and Community Services Department letterhead.

It was his suggestion that the one on a Harare Housing and Community Services Department letterhead was generated after the one from Bulawayo. The dates on the two letters were false, and the two letters were written after 12 July 1985. The letter of 11 June did not bear a date stamp. Dates were manipulated to make it appear as if the letter of cancellation was written before the letter offering transfer was written on 12 July 1985. The letter of 20 June 1985 and the letter of 11 July 1985, written from Bulawayo, were both tempered with or manipulated.

It was, therefore, his view, that the Agreement was still binding.

In pursuance of this, they instituted proceedings in the Magistrates Court demanding transfer in case number M1959/85. The case was dismissed because their lawyers failed to attend court. They later appealed to the Supreme Court where their matter was dismissed.

Thereafter, there was a series of court actions and applications by all the parties in the matter- culminating in this matter.

Tendai Musemburi added that they had not paid the balance of $21,375=, which they intended to cover with a mortgage bond which they had secured. He, however, said the balance was finally paid in 1994 when a total of $60,000= was paid through their lawyers.

Tendai Musemburi said if the court finds the Agreement they entered into with the third defendant to be alive, they were to pay the third defendant something like Z$40,000= in full and final settlement of what was due.

In response to questions by the court, Tendai Musemburi agreed that they were supposed to have completed payments by 31 March 1985, and that the third defendant had several opportunities to cancel the Agreement for breach of contract but did not do so, instead, he gave them extensions on more than two occasions.

I now turn to consider whether or not the Agreement of Sale between the first and second defendants and the third defendant was validly cancelled.

It is common cause that the first and second defendants had problems in the payment of the purchase price in terms of the Agreement. Most of the payments they managed to pay were made late, in contravention of the clear provisions of the Agreement. They concede that the third defendant had several occasions to cancel the Agreement on account of their breach, but chose not to.

They still have not paid more than half of the purchase price.

The balance remained unpaid on 12 June 1985, which was the extended deadline they were given by the third defendant.

I agree with the submissions made on behalf of the plaintiff that in light of the 20 June 1985 letter, Scanlen & Holderness had no authority to offer transfer to the first and second defendants.

It follows that if the first and second defendants cannot show that the letter of 20 June 1985 is not genuine, they cannot prove that the Agreement was not validly cancelled.

The first and second defendants' problem is exacerbated by the fact that the third defendant chose not to come to court. The situation would certainly have been clearer had the third defendant given evidence in this court.

Even if one assumed that I was not correct in holding the Agreement was cancelled after receipt of the letter of 12 July 1985 from Scanlen & Holderness, such cancellation would have been proper because the first and second defendants did not pay the amount of money requested in that letter.

HH25-10 : MAXWELL MATSVIMBO SIBANDA vs GWYNNE ANNE STEVENSON
Ruled By: CHITAKUNYE J

On 27 April 2007 the defendant purported to cancel the Deed of Sale as the plaintiff had not paid the first instalment.The plaintiff challenged the cancellation of the Deed of Sale.In terms of clause 4 of the Deed of Sale, the first instalment was supposed to have been paid on or before 31 March 2007 ...

HH67-10 : JAMES MUTETWA vs BARRIE DIXON and MARKO MAVHURUNE N.O. (as Executor Estate Late Samuel Mushaninga) and KENIAS MUTYASIRA N.O. (as Executor Estate Late Salome Chisvo) and REGISTRAR OF DEEDS
Ruled By: MAKARAU JP

Assuming that I have erred in holding that the written agreement was concluded without the necessary animus and is thus not binding between the parties, I still would have refused the applicant an order of specific performance on the same. By his own confession, the applicant is in breach of the agreement. It was a specific term ...

HH107-10 : CHIROSWA MINERALS (PRIVATE) LIMITED and BASE MINERALS (PRIVATE) LIMITED vs MINISTER OF MINES and MORIS TENDAI NYAKUDYA and VAMBO MILLS (PRIVATE) LIMITED
Ruled By: BHUNU J

On..., August 2006, the parties concluded another agreement nullifying the principal agreement and concluding a fresh Agreement of Sale the terms of which provided as follows - “The principal agreement was signed and witnessed on the 8th day of August 2005. Whereas it is agreed that:- 1.0 The principal Agreement became null and void on 30 June 2006 ...

On..., August 2006, the parties concluded another agreement nullifying the principal agreement and concluding a fresh Agreement of Sale the terms of which provided as follows -

“The principal agreement was signed and witnessed on the 8^th day of August 2005. Whereas it is agreed that:-

1.0 The principal Agreement became null and void on 30 June 2006 and the Tribute Agreement likewise became null and void.

1.1 Now, therefore, in view of prevailing circumstances within Zimbabwe, the Seller has agreed to grant an extension to the principal agreement to 31 December on the following terms and conditions:

1.1.1 All monetary claims, capital payments, interest, shall be denominated in US dollars.

1.1.2 That the first US$5,000= capital which was due and payable by 30 April 2006 has been paid at the Inter-Bank rate ruling at 31 July 2006 in the sum of Z$500,000,000= (five hundred million dollars Zimbabwean dollars).

1.1.3 That a minimum of US$5,000= capital repayment shall be made on the last day of every third month in Zimbabwe dollars at an exchange rate which shall be negotiable in relation to the market rate for each US dollar, or that date, save that payments shall be due on or before 31 December 2006.

1.1.4 That on the last day of each month a sum in US dollars equivalent to 50% per annum interest on the capital sum of US$75,000= shall be paid in Zimbabwe dollars calculated at the exchange rate each month in relation to the market rate for each US dollar o that date.

1.1.5 That the monthly payment referred to in para 1.1.4 shall continue until such time as the capital sum has been fully paid up.

2.0 The foregoing shall hold in principal until 31 December 2006 at which time the capital payment schedule shall be reviewed.

3.0 Tribute payments have to be brought up to date not later than 30 September 2006 and thereafter paid in accordance with the agreement not later than 10^th of the month following sale covered by a full declaration of sales in accordance with the terms of the Tribute Agreement.

4.0 In the event of non-compliance with any of the terms and conditions granted in this addendum, the seller shall have the right to repossess assets and to cancel the Tribute Agreement with immediate effect without further notice or compensation.”...,.

On 9 October 2006, the Grantor addressed a notice of cancellation in the following terms –

“NOTICE OF CANCELLATION OF AGREEMENT

Dear Sir

1. The above matter, and in particular paragraph 3.0 of the Memorandum of Agreement dated 8 August 2006 refers.

2. From a perusal of our records the tribute royalties have not been paid as agreed by not later than 30 September 2006.

3. Notice is hereby given you have been given 30 days notice to rectify the breaches of the terms of the ten year agreement dated 17 May 2005.

4. In the event of your failure to rectify the breaches in regard to the Memorandum of Agreement dated August 2006, Chiroswa Minerals are entitled to cancel the ten year agreement without further notice to you.”

The central issues for determination are whether or not the respondents have persistently breached the Tribute Agreement as alleged or at all. If so, whether or not the Tribute Agreement was procedurally cancelled in terms of the laid down procedures as provided in the Tribute Agreement.

View Appeal
SC36-13 : DINESH MANIAL NARAN vs RONNAH MAFURIRANO and THE REGISTRAR OF DEEDS
Ruled By: CHIDYAUSIKU CJ, ZIYAMBI JA and MAKONESE AJA

The appellant issued summons in the High Court, Bulawayo, seeking an order declaring the sale agreement concluded between him and the first respondent to be valid and binding on the parties as well as an order compelling the first respondent to transfer, to the appellant, her rights title and interest in Stand Number 378 Gorebridge Road, Killarney, Bulawayo (hereinafter referred to as “the property”) failing which the Deputy Sheriff be authorized to sign all documents necessary to effect the transfer.

In the alternative, the appellant sought a refund in the sum of Z$1,500,000= plus interest a tempore morae from 31 October 2001, compensation in the sum of Z$2,500,000= for improvements on the property and costs of suit against the first respondent on a legal practitioner and client scale.

The High Court found that the agreement between the parties had been cancelled by the appellant and that the latter was entitled to a refund of the sum of Z$1,500,000= as well as compensation for proved improvements. The appellant was ordered to pay the costs of suit.

This is an appeal against the judgment of the High Court.

Out of the numerous grounds of appeal (19 in all) forming part of the notice of appeal most of which amounted to no grounds at all in terms of the Rules of the Supreme Court, the determining issue is whether or not the trial court was wrong in its finding that it was the appellant himself who cancelled the agreement.

The facts may be briefly stated as follows.

The appellant (“Naran”) and Thokozani Khumalo (“Khumalo”) are business partners. Khumalo was a tenant at the property which is owned by the first respondent. Sometime in 2001, an opportunity arose for the first respondent and her husband (“Mr Mafurirano”) to purchase a farm and a business. They decided to sell the property in order to raise money for that purpose and gave Khumalo the first option to purchase it. Khumalo sought financial assistance from Naran, and, shortly thereafter, the Mafuriranos were referred to Naran's legal practitioner (“Mr Ndlovu”) with whom they agreed on a price of Z$5.3 million. An Agreement of Sale was drawn up between Naran and Mrs Mafurirano. Paragraph 1 of the Agreement provided as follows:

“PURCHASE PRICE AND PAYMENT

The purchase price payable to the Seller by the Purchaser for the said Stand shall be the sum of $5,300,000= (Five million three hundred thousand dollars). A deposit of Z$2,500,000= (two million five hundred thousand dollars) shall be paid upon the signing of this Agreement and the balance of Z$2,800,000= (two million eight hundred thousand) shall be paid in monthly instalments of Z$1,500,000= with effect from on or before the 31 October 2001 finishing with the balance of Z$1,300,000=. 30% per month interest shall be paid on Z$2,300,000=.”

Mrs Mafurirano signed the agreement on 12 September 2001 and returned it to Mr Ndlovu for signing by Naran who eventually signed on 30 September 2001.

No payment of the deposit was made on that date notwithstanding the provision for payment of a deposit upon signature of the Agreement. It was not until 26 October 2001 that Naran made a payment of Z$1,500,000=.

Numerous efforts by the Mafuriranos to obtain further payment from him met with no success. They consulted Mr Ndlovu, who referred them to Naran. On 7 November 2001, Mr Mafurirano had a meeting with Naran who advised him, firstly, that Mr Ndlovu had had no right to enter into the Agreement on his behalf, secondly, the house was overpriced and he could get a better house for the same price in Ilanda or Famona, and, thirdly, that of the Z$1.5 million which he had paid, $1.1 million was to be returned and the balance of $400 000, 00 was to be kept by the Mafuriranos for the inconvenience caused to them.

It was the Mafurirano's understanding that by making the above utterances to him, Naran had cancelled the Agreement.

He therefore wrote to Khumalo the following day relating the above and informing Khumalo, inter alia, that the Mafuriranos had, in the circumstances, taken a decision not to dispose of the property. No response having been received from Khumalo to the letter, the Mafuriranos instructed their legal practitioners to write to Naran. The letter, dated 7 February 2002, read in relevant part, as follows:

“Re: Agreement of Sale with Ronnah Marurirano

We refer to the above matter in which we act for Ronnah Mafurirano with whom you entered into a sale agreement in respect of Stand 378 Gorebridge Road, Killarney.

The purchase price was in the sum of $5,300,000= payable as to a deposit of $2,500,000= and the balance of $2.8 million in monthly instalments of $1.5 million starting end of October 2001.

You paid $1.5 million as a deposit on the 26^th October 2001. This was $1 million less that the agreed deposit.

You have not paid anything further after the $1 million (sic) referred to.

Our clients instruct us to enquire from you, as we hereby do, whether it is still your intention to proceed with the purchase, and, if so, when they can expect to receive the balance which is overdue. If you are no longer interested in the purchase please advise to enable our clients to move forward. Please let us have your election either way within 7 days of this letter failing which we will approach court for an order to declare forfeit as a pre-estimate of damages the deposit paid.

Yours faithfully

Majoko and Majoko”…,.

Still no response having been received, another letter, dated 2 May 2002, was written. It read thus:

“Dear Sir

Re: Agreement of Sale with Ronnah Mafurirano

We refer to the above.

In terms of your agreement you were supposed to pay a deposit for the purchase price in the sum of $2,500,000= on the date of your signing the agreement. You failed to so. In fact you only paid the sum of $1,100,00= (sic).

Through several letters to you, our client informed you that time of payment was of the essence. You have failed to make any other payment from the date you made the first instalment. You have breached your contract.

Due to your breach of contract, by failing to pay on time and as stipulated in the contract, our client now considers your contract cancelled.

Our client also wishes to notify you that he reserves the right to forfeit the instalment paid to her.

Yours faithfully

Majoko and Majoko”

Both letters were addressed to Naran, personally, but were sent to a wrong address. However, Mr Ndlovu, his legal practitioner, admitted that they had been received at his office and that, despite his denials, Naran was aware of the letters. Mr Ndlovu also admitted, in his evidence to the court a quo, that although Naran was in material breach of the agreement, the Mafuriranos kept on granting extensions up to 2 May 2002 when they caused the letter to be written by their legal practitioners accepting the cancellation of the agreement.

Naran's allegations to the contrary were not accepted by the court a quo. His evidence was rejected by that court as being unworthy of belief. The evidence of Naran conflicted with that of his two witnesses (including his legal practitioner) both of whose evidence supported the evidence of Mr Mafurirano.

It was contended, on behalf of the appellant, that the sale, being an instalment sale, was unilaterally cancelled by the first respondent in violation of section 8 of the Contractual Penalties Act [Chapter 8:04], which requires that notice of cancellation should be given to the purchaser by the seller and specifies the manner in which such notice should be given.

The learned Judge, however, accepted, on the evidence of Mr Mafurirano, as corroborated by Mr Ndlovu, that the Agreement was cancelled, not by the first respondent but by Naran.

This conclusion, in our view, is amply supported by the evidence.

The appeal is therefore devoid of ment.

It is for the above reasons that after hearing counsel, we dismissed the appeal with costs and indicated that our reasons would follow.

HH160-10 : TONDERAI HAMANDISHE and GAMUCHIRAI SANGARE vs MAFFACK PROPERTIES (PVT) LTD
Ruled By: MTSHIYA J

This is an opposed application wherein the applicant seeks the following relief: “1. The purported cancellation of the agreement of sale dated 17th October 2006 between the applicants and the respondents be and is hereby set aside. 2. The respondent be and is hereby ordered to forthwith transfer the undivided share in a certain piece of land situate in ...

This is an opposed application wherein the applicant seeks the following relief:

“1. The purported cancellation of the agreement of sale dated 17^th October 2006 between the applicants and the respondents be and is hereby set aside.

2. The respondent be and is hereby ordered to forthwith transfer the undivided share in a certain piece of land situate in the district of Salisbury being land share number 13 of Stand number 195 Monavale Cluster Homes, also known as subdivision A, portion of Mayfield Estate to the applicants upon respondent satisfying the minimum service requirements set out in its development permit.

3. The respondent shall bear costs of suit on a legal practitioner/client scale.”

It is common cause that on 17 October 2006 the parties entered into an Agreement of Sale. The respondent sold to the applicants its property known as an undivided share in a certain piece of land situate in district of Salisbury being land share number 13 of Stand number 195 Monavale Cluster Homes also known as Subdivision A, Portion of Meyfield Estate measuring 704 square metres (the property). The price for the property was $4,928,000= (old Zimbabwean currency) and the agreed mode of payment of the purchase price was:

“Deposit of $3,000,000= payable upon signing this agreement of sale of which an amount of $2,630,400= is payable to Bvekwa Legal Practice and an amount of $369,600= is payable to Maffack Properties representing 7.5% of the purchase price. The balance to be paid over 3 months in three (3) equal instalments. Any delays will attract an interest of 300% per annum.”

It is not in dispute that by 31 January 2007 the applicants had fully paid the agreed purchase price. However, on 27 February 2008 the respondent's legal practitioners addressed the following letter to the first applicant:

“WITHOUT PREJUDICE

Dear Sir/Madam

RE: PROPERTY: SHARE NO. 13 OF SUBDIVISION A, PORTION OF MAYFIELD ESTATE (MONAVALE CLUSTER HOMES): VARIATION OF AGREEMENT OF SALE

Our client has instructed us to communicate to you regarding the above issue as follows:

As you may be aware, the construction works at the Monavale Cluster Homes site has come to a halt. This has been caused by an order given by the Environmental Management Authority to stop the works pending the production of an Environmental Impact Assessment Report. This has since been complied with. However, in the interval, inflation has eroded the value of the amounts paid thus far. This has made it impossible for the further works to continue. Without the completion of the works, it is not possible for our client to transfer ownership of the property sold to you.

In these circumstance, our client makes the following without prejudice offer to you. It is that you enter into a variation of the agreement of sale entered into between yourselves and our client. In terms thereof, you would agree to an increase in the amount needed to complete the servicing works. This amount is in the sum of $36 billion dollars. This amount would be payable by the end of March 2008. In return, our client would begin a programme to complete servicing the property. This programme shall be completed within 90 days reckoned from the 1^st of April 2008.

The alternative to the above is the cancellation of the agreement of sale. You would be refunded 60% of the current market value of the property the subject of the agreement of sale, minus administrative expenses so far incurred e.g. agents commission and administration fees. The amount in question would be paid within a reasonable time of your acceptance of cancellation.

We have been requested to furnish you with up to 31^st of March 2008 to signify your election. This may be done by delivering, in writing, your response at our offices.

Should you fail to make an election or reject the above proposals, be advised that our client shall apply to court for an order of cancellation of the agreements entered into on the amount of the purchase price paid in the manner the court may deem fit.

We await your consideration.

Yours faithfully

___________________

Kawonde and Company”

On 1 July 2008, the applicants' legal practitioners responded to the above letter as follows:-

“Dear Sir

RE: PROPERTY: SHARE NO.13 SUBDIVISION & PORTION OF MAYFIELD ESTATE (OUR CLIENT MR & MRS HAMANDISHE)

The above two are our clients, who, from instructions, purchased the above property from yours. We have been shown the agreement of sale between the concerned parties together with your minute to our clients dated 27^th February 2008.

In the context of your said minute we felt that there may be need for us to get some clarifications viz issues raised therein.

(a) Is it your client's attitude that the delay in the completion of the project was occasioned by ours, and, if so, how?

(b) At what stage of development has the project reached and what are the minimum stages required before the properties may be transferred to the individual purchasers.

(c) On what grounds does your client believe that in the event of cancellation of the agreement ours can only get 60% of the paid purchase price?

(d) What guarantees are there that in the event of our client paying and the others refusing to do so, the project will still be completed within ninety days as suggested in your minute?

You will possibly appreciate the assistive extent of your client's responses to the above, and, more importantly, how such responses could enable us to cut a seemingly long story short.

We kindly wait to hear from you by return of post.

Yours faithfully

___________________

Mufadza and Associates”

On 8 July 2008, the respondents' legal practitioners again wrote to the applicants' legal practitioners in the following terms:-

“Dear Sir or Madam

RE: OUR CLIENT MAFFACK PROPERTIES (PVT) LTD: YOUR CLIENT MR AND MRS HAMANDISHE: SHARE NO. 13 OF SUBDIVISION 195 A, PORTION OF MAYFIELD ESTATE

We thank you for your letter of 1 July 2008.

We have been instructed to reply as follows:

The delay in the completion of the development was not occasioned by your client. At the time the project stalled, it was 60% complete. Our client believes that it is just and equitable that your client gets 60%, as the amount reflects the extent of the improvement of the property as of now.

Regrettably, your client declined to accept the offer by ours. Accordingly, the agreement is hereby cancelled. Our client offers to pay to yours the full amount he paid, adjusted for inflation using the CPI as at the date of payment, in full and final settlement of all its obligations in respect of the above transaction.

Yours faithfully

__________________

Kawonde & Company”

It is the attitude of the respondent, as emerges from correspondence quoted above, that caused the applicants to file this application on 30 July 2008 seeking the relief indicated on the first page of this judgment.

At the hearing of this matter the applicants abandoned clause 2 of their relief and persisted that they wanted the court to determine the status of the Agreement of Sale.

Counsel for the applicants submitted that the applicants had complied with their obligations arising out of the Agreement of Sale, and, as such, there was no basis for the agreement to be cancelled. He correctly submitted that the attempted variation of the Agreement of Sale did not comply with clause 12 thereof which provides as follows:

“12. WHOLE AGREEMENTS

This agreement constitutes the entire contract between the parties hereto otherwise than as may be recorded herein and:-

13.1 No warranty, representation, promise or undertaking has been given or made by either party to the other except as recorded in this Agreement;

13.2 There are no conditions precedents suspending the operation of this Agreement which is not referred to herein;

13.3 No variation in this Agreement shall be valid unless reduced to writing and signed by or on behalf of the parties hereto.”…,.

He also said the parties had categorically stated what was covered by the purchase price through clause 14 which provides as follows:

“14. SPECIAL CONDITIONS

14.1 It is agreed that the amounts so paid shall be used for purposes of servicing the land, administrative expenses, professional fees and any other incidental expenses since the Stand is being sold off-plan. For this purpose, the Purchaser has agreed and authorized the release of the money to the seller.

14.2 The purchase price of Z$4,928,000= includes the cost of architectural and structural designs.

14.3 The Seller undertakes to complete servicing, that is, provision of sewer and water reticulation, drainage and surface water management system on or before December, 2006 or any other date thereafter agreed between the parties.”

All in all, counsel for the applicants submitted it was the respondent who was in breach of the agreement of sale. He said, whilst claiming impossibility of performance due to inflation, the respondent had not taken the route of seeking formal liquidation and thereby protecting the interests of people such as the applicants. He therefore urged the court to declare the purported cancellation of the agreement as null and void.

Counsel for the respondent submitted that the relief sought (ie declaring the cancellation of the agreement of sale null and void) would not assist the applicants in any way, and, as such the applicants should have simply withdrawn the application. He said the property in question was not registered in the respondent's name. That aspect would certainly stand in the way of specific performance (i.e. transfer of property to applicants). In any case, he argued in his heads of argument:

“It is common cause that the respondent had to comply with regulatory conditions after it had commenced infrastructural works in terms of the permit. It is undeniable that hyperinflation gripped Zimbabwe and intensified with each succeeding year. The phenomenon of top ups is now known from school fees to ordinary purchases of goods and services. So notorious has this become that the monetary authorities have, in certain cases, allowed settlement of obligations in some other currency, say US dollar.”

Relying on WILLIE & MILLIN's Mecantile Law SA 15ed, counsel for the respondent quoted from page 69 of the edition as follows:

“When a contract has become impossible of performance after it has been entered into the position is the same as if it had been impossible from the beginning.”

He therefore did not see merit in the relief sought by the applicants and called for the dismissal of the application.

The papers in casu clearly confirm that as at 31 January 2007 the applicants had satisfied clause 2 of the Agreement of Sale as read together with the mode of payment already spelt out on first the page of this judgment. Apart from unilaterally creating new obligations for the applicants, the respondent does not dispute that by 27 February 2008, when it sought to vary the Agreement of Sale, the applicants had long fully discharged their obligations under the said Agreement of Sale. The purported variation, without the consent of the applicants who already had complied with the contract, and without court confirmation, was, in my view, clearly in violation of clause 12 of the agreement. The respondent had no basis upon which to justify cancellation of the agreement of sale. The best that the respondent could have done was to seek a legal route for confirmation of its inability to perform due to an intervening impossibility.

In its letter of 27 February 2008, the respondent had said:-

“Should you fail to make an election or reject the above proposals, be advised that our client shall apply to court for an order of cancellation of the agreements entered into on the amount of the purchase price paid in the manner the court may deem fit.”

That was never done.

The position is simply that the respondent is in breach of the Agreement of Sale, and, as a way out, now seeks to unilaterally cancel the agreement citing inflation and intervening impossibility. To allow such a move to succeed would certainly destroy the sanctity of contractual relationships. The purported cancellation is, in my view, clearly intended to avoid specific performance. However, economic hardships cannot be used as automatic weapons to defeat contracts.

In a similar situation, in International Trading (Pvt) Ltd 1993 (1) ZLR 21 (H), the late ROBINSON J had this to say:

“I would wind up by saying that if the right of specific performance is to be shown to have real meaning to businessmen, then the loud and clear message to go out from the courts is 'businessmen beware.' If you fail to honour your contracts, then don't start crying, if, because of your failure, the other party comes to court and obtains an order compelling you to perform what you undertook to do under your contract. In other words, businessmen who wrongfully break their contracts must not think they can count on the courts, when the matter eventually comes before them, simply to make an award of damages in money, the value of which has probably fallen drastically compared to its value as the time of breach. Businessmen at fault will therefore, in the absence of good grounds showing why specific performance should not be decreed, find themselves ordered to perform their side of the bargain no matter how costly that may turn out to be for them…,.”

Admittedly, the above sentiments were echoed specifically in relation to the issue of specific performance. However, I am here quoting the same because the respondent's action (ie unilateral cancellation of the Agreement of Sale) is clearly intended to avoid specific performance. The applicant in casu seeks a declaration which is meant to save the Agreement of Sale. The applicants can only proceed to demand specific performance if the purported cancellation is declared null and void. That explains the applicants' position in abandoning clause 2 of the original relief sought.

I have, in this judgment, made a finding that the applicants complied with the terms of the agreement and were therefore not in breach, if anything the respondent was in breach of the agreement. The applicants are therefore saying there is no justification on the part of the respondent to run away from the agreement and that any variation of the agreement can only be effected in terms clause 12 of the Agreement of Sale. I am unable to fault the applicants' reasoning and therefore I find merit in their application. I therefore find it proper to grant the relief sought.

I accordingly order as follows:-

It is ordered that:

1. The purported cancellation of the Agreement of Sale dated 17 October 2006, between the applicants and the respondent, be and is hereby declared null and void; and

2. The respondent shall pay costs of suit.

HH161-10 : NEVER BVOCHORA vs DOUGLAS TOGARASEI MWONZORA (In his capacity as The executor Dative of the Estate Late I.V. Rukatya)
Ruled By: HUNGWE J

The defendant, in his evidence, states that the parties entered into one Agreement, exhibit 1. The plaintiff paid Z$350 million in 2006. He failed to pay the balance and the defendant cancelled the Agreement. The defendant, therefore, disputes that the plaintiff is entitled to specific performance as he is in default of the Agreement.

HB12-10 : BETTY GASELA vs LEONARD MALINGA and BULAWAYO CITY COUNCIL and THE REGISTRAR OF DEEDS
Ruled By: KAMOCHA J

Leonard Malinga's allegation that the cancellation of the contract between him and the City of Bulawayo was due to the applicant's dilatoriness in applying for a Development Permit is without foundation. The more likely reason why the contract was being cancelled was that he had not effected any development on the property in a period ...

HB63-10 : SALLY MAPLANKA vs B. A. NCUBE HOLDINGS
Ruled By: NDOU J

The next question for consideration is whether or not the plaintiff validly cancelled the lease agreement. The written lease agreement does not contain any clause stating the method of cancellation or notification of the cancellation. As a general rule cancellation must be communicated to the other party – Swart v Vosloo 1965 (1) SA 100 (A)…, and Phone-a-Worldwide ...

The next question for consideration is whether or not the plaintiff validly cancelled the lease agreement.

The written lease agreement does not contain any clause stating the method of cancellation or notification of the cancellation.

As a general rule cancellation must be communicated to the other party – Swart v Vosloo 1965 (1) SA 100 (A)…, and Phone-a-Worldwide Copy Ltd v Orkinand Anor 1986 (1) SA 729 (A)…,.. It is also a principle of our law that if cancellation has not been previously communicated it takes effect from service of summons or notice of motion/application – Middelburgse Stadsraad v Trans-Natal Steenkool Korporasie Bpk 1987 (2) SA 244 (T) case…,.. In other words, the institution of proceedings is adequate notification of cancellation. It, therefore, follows that even if the cancellation letters of 2nd and 6th December 2005 were ineffectual for the reasons stated in the defendant's supplementary heads, or for whatever reason, the service of summons on 6th January 2006 was, at law, valid and effective notice of cancellation. The fact that the true or correct reason of cancellation was not contained in the letters of 2nd and 6th December 2005 does not affect the matter. What is crucial is that the true and valid and correct ground for cancellation was failure to timeously pay the November 2005 rental. That reason or ground is included in the summons and declaration.

Admittedly, an additional incorrect ground was added…,. In Beck v du Toit 1975 (1) SA 366..,. it was stated that -

“I do not, however, understand the law to be that a party who alleges facts which disclose more than one breach of contract justifying cancellation must, in addition to stating that he claims cancellation, specifically state that he is cancelling on each ground available to him on pain of being precluded from relying on particular ground not expressly stated, to do a ground of cancellation.”

It is further stated at 369:

“I am accordingly of the view that where the applicant has, on 28 March 1974, consistently manifested the attitude that the deed of sale has been cancelled by her, and where he had a valid and undisputed ground for cancellation at the time she instituted motion proceedings for cancellation she is entitled to rely on such ground even though she has not stated in her affidavit in so many words that she is claiming cancellation on that ground.”

Having regard to the above principles, the service of summons on the defendant, to which summons was attached, a declaration which stated a valid and undisputed ground of cancellation, namely non-timeous payment of November 2005 rent, constitutes sufficient and legally valid notification of cancellation of the lease agreement. The fact that the letter of purported cancellation did not include the only valid ground of cancellation, viz non-timeous payment of November 2005 rent, is irrelevant since the summons contained a valid ground of cancellation.

Accordingly, the plaintiff has made out an unanswerable case and is thus entitled to judgment in her favour.

Accordingly, it is hereby ordered that:-

(a) The cancellation of the agreement of lease between the parties be and is hereby confirmed.

(b) The defendant be and is hereby ejected from premises known as Lot A, Old Breweries, Bulawayo Township, corner Robert Mugabe Way and Escort Avenue, Northend, also known as Airport Road Filing Station.

HH11-13 : FLORENCE SIGUDU vs MINISTER OF LANDS AND RURAL RESETTLEMENT N.O. and PHINEAS CHIHOTA
Ruled By: PATEL J

Whether Offer Letter Withdrawn or Cancelled In terms of paragraph 3 of the conditions attaching to the applicant's offer letter, the offer may be cancelled or withdrawn for breach of any of the conditions set out in the letter. In view of my earlier finding that the applicant did comply with the requisite conditions, there does ...

Whether Offer Letter Withdrawn or Cancelled

In terms of paragraph 3 of the conditions attaching to the applicant's offer letter, the offer may be cancelled or withdrawn for breach of any of the conditions set out in the letter. In view of my earlier finding that the applicant did comply with the requisite conditions, there does not appear to have been any valid ground entitling the Minister to cancel or withdraw the offer made to the applicant.

Even if any such ground did exist, it is abundantly clear that the Minister did not take any specific steps to cancel or withdraw the offer. The undisputed facts are that the offer was never formally terminated. The applicant was not given any notice of any alleged breach of the conditions of offer. Nor was there any formal notice or communication of the offer having been withdrawn. And there is absolutely nothing in the opposing papers to suggest otherwise. The Minister's argument that the offer was automatically withdrawn simply cannot be accepted. As I have already stated above, the power to withdraw or cancel an offer of land must be exercised lawfully and procedurally, and this quite obviously necessitates the giving of due notice to the holder of the offer letter. It follows that the procedure for cancellation or withdrawal in accordance with the conditions set out in the applicant's offer letter was never followed.

Whether Right to Occupy Subsists and is Enforceable

The ineluctable conclusion from all of the foregoing is that the applicant's right to occupy the farm allocated to her has not lapsed or been lawfully terminated and therefore still subsists. It is accordingly duly recognizable and fully enforceable. See in this respect the remarks of CHIDYAUSIKU CJ in Commercial Farmers Union & Others v Minister of Lands and Rural Resettlement & Others SC31-10…, highlighting the duty of the courts to assist the holders of offer letters, permits and land settlement leases.

At the end of her submissions, counsel for the Minister quite correctly conceded that there was no basis for resisting the declaratory and consequential relief sought by the applicant.

Disposition

In the result, it is hereby declared that:

(a) The applicant is lawfully authorised and entitled to be in occupation of Subdivision 2 of Denby Farm in Seke District of Mashonaland East Province in terms of the offer letter issued to her by the 1^st respondent on the 2^nd of June 2002.

(b) The purported consolidation of Subdivisions 2 and 9 of Denby Farm in Seke District of Mashonaland East Province by the 1^st respondent's officials is null and void.

Furthermore, it be and is hereby ordered that:

(c) The 2^nd respondent shall give vacant occupation of Subdivision 2 of Denby Farm in Seke District of Mashonaland East Province to the applicant, failing which the Deputy Sheriff is hereby authorised and directed to evict the 2^nd respondent and give possession of the farm to the applicant.

HH147-11 : FANUEL MWAYERA vs MOLLY CHIVIZHE and STANLEY CHIVIZHE and THE REGISTRAR OF DEEDS and GILBERT JONGA
Ruled By: CHITAKUNYE J

It may also be noted that the applicant did not state that he ever put the fourth respondent in mora before purporting to cancel the Agreement of Sale. The fourth respondent was not put in mora and so the purported cancelling could, on that ground, not stand.

Appealed
HH158-11 : TRUSTCO MOBILE (PTY) LIMITED and TRUSTCO GROUP INTERNATIONAL (PTY) LIMITED vs ECONET WIRELESS (PRIVATE) LIMITED and FIRST MUTUAL LIFE ASSURANCE COMPANY (PRIVATE) LIMITED
Ruled By: MUTEMA J

On 17 August 2010, the first applicant and the respondents concluded a tripartite agreement in terms of which the first applicant undertook to provide the first respondent with certain software and support services to facilitate provision of free life insurance cover to Zimbabwean cellular phone users and customers of the first respondent against the purchase of cellular airtime from the first respondent. In terms of the agreement, the first applicant would procure, for and on behalf of the first respondent, such life cover from the second respondent at no cost to the first respondent's customers against payment of a fee to the first applicant by the first respondent, prescribed and calculated in terms of that agreement. The project would be known in Zimbabwe as “Ecolife”.

The business model for the provision of free life cover as against the purchase of airtime amounts to an intellectual property (whose copyright and international patent has been applied for) known as Transaction Facilitation System. This business system and software is called the Trustco Mobile Concept.

The agreement was to endure for an initial fixed duration of 18 months. There is no consensus on the papers as to the extent of the success of the implementation of the system but what can be gleaned is that substantial revenue, running into millions of US dollars, was reaped from it to the benefit of the three parties to the agreement. Matters came to a head when the first applicant and the first respondent could not agree on the mode of calculating the royalty fees payable to the former. Following a series of correspondence between the two parties, through its Group Managing Director, the first applicant wrote to the first respondent on 31 May 2011 advising that the latter was formally in breach of the agreement for non-payment of royalties to it and premiums to the second respondent. The operative part of that correspondence reads:

“Therefore, be advised that all obligations of Trustco will be suspended on 3 June 2011 at 12:00 hours Namibian time if all overdue payments are not received by then…,. Kindly be further advised that if all overdue amounts, of which you have been advised, are not received within 14 days from date hereof Trustco will deem the contract cancelled in terms of clause 17.1 of the main agreement.”

The clause reads:

“17.1 If either of the parties breaches any provision of this agreement and fails to remedy the breach within fourteen (14) days of dispatch of a written notice to do so, the Party not in default may, notwithstanding any provision to the contrary in this Agreement, without prejudice to any of its other rights in law, cancel the agreement forthwith;”

On 1 June 2011, the first respondent, through its Chief Executive Officer, replied to the first applicant's letter of 31 May 2011 in this vein:

“We acknowledge receipt of your letter dated 31 May 2011 regarding the above. Your intention to terminate the agreement has been noted and accepted.

Econet maintains that it has discharged all its obligations under our agreements with you. We repeat our averment that royalties are only payable in respect of subscribers who buy airtime of a value exceeding $3= per month. Those subscribers who buy airtime of a value amounting to $3= but do not buy any additional airtime are not entitled to cover.

Consequently, no royalties are payable in respect of such subscribers….,.”…,.

On 3 June 2011, the first applicant replied to the first respondent's letter of 1 June 2011. In the letter the dispute over payment of royalties and the interpretation of the agreement raged on. The first respondent was called upon to provide three names of people from whom an arbitrator could be chosen to enable referral of the dispute to arbitration in terms of clause 19 of the agreement. The peroration of that letter reads:

“Legal advice received indicated that we are not entitled to switch off the system until 14 working days have lapsed since 31 May 2011. Hence the system will remain operative until then.”

On 5 June 2011, the first respondent's Chief Executive Officer replied to the above letter saying inter alia:

“We refer to your letter of 3 June 2011 and advise that we stand by our letter of 1 June 2011 in terms of which we accepted your notice of termination of our agreement. Therefore, we consider the agreement terminated. We shall proceed to make arrangements to ensure that our subscribers are not prejudiced by the termination of the agreement that was initiated by you. We do not owe the amounts that you claim to be outstanding…,. Your request for a referral of our dispute to arbitration was made on the assumption that the agreement between us was going to remain in force. Your assumption was misguided because you had already given us notice to terminate the agreement in your letter of 31 May 2011 and we had accepted such notice in our letter of 1 June 2011. Because you made your election to terminate the agreement, you cannot withdraw such election, more particularly as we had accepted and communicated to you our acceptance of the termination of the agreement.”

About the time this letter was written, the first respondent terminated the first applicant's link to the former's mobile platform. The parties then sought the services of legal practitioners. The first applicant's legal practitioners, Rudolph, Bernstein and Associates, wrote to the first respondent's Chief Executive Officer on 8 June 2011 explaining that their client's letter of 31 May 2011 was misconstrued because the intention to cancel the agreement should the first respondent fail to remedy the breach within the fourteen day period did not, and was never intended, to constitute an invitation to the first respondent for a consensual termination of the agreement which it purported to accept. In the event, the first respondent's conduct amounted to an attempt to repudiate the agreement whereas any dispute should be referred to arbitration in terms of clause 19 of the agreement. The letter gave the first respondent 9 June 2011 as deadline for restoration of the first applicant's electronic links to the former's mobile platform to facilitate resumption of service provision in terms of the agreement failing which “urgent injunctive relief” would be sought in order to restore the status quo ante pending institution of arbitration proceedings.

On 9 June 2011, the first respondent's legal practitioners of record responded to the first applicant's legal practitioners' letter alluded to supra. Therein, the stance was adopted that as it was the first applicant which sought the termination of the agreement, which the first respondent accepted, therefore the first applicant cannot be heard to allege that it was the first respondent which repudiated the agreement. In the result, the first applicant cannot tender performance of an agreement which it has cancelled and

which cancellation has been accepted.

The foregoing narration culminated in the filing of the urgent chamber application on 24 June 2011. The provisional order being sought is worded in the following terms:

“Final Relief Sought

That you show cause why the following final order must not be granted.

1. Pending the determination of the dispute between the parties by the process of Arbitration in terms of the provisions of the Arbitration Act, the first respondent shall not take any steps neither shall it act in any such manner as is inconsistent with the rights of the applicants arising from the agreement between the parties (as amended), and shall not act in any such way unless entitled to so act in terms of any Arbitral Award that may be handed down.

2. The costs of this application shall be costs in the envisaged arbitration proceedings.

Interim Relief Granted

That pending determination of this matter on the return date, applicants are granted the following relief:

1. The first respondent is directed to restore to the first applicant the internet based reporting links and all access to Trustco Mobile hardware and software, thus enabling it to monitor and process airtime purchase transactions and otherwise perform its obligations in terms of the agreement; and

2. The first respondent be directed to refrain from undertaking and implementing a competing, infringing service to that provided by the first applicant in terms of the agreement.

Service of the Provisional Order

The applicants' legal practitioners be and are hereby granted leave to effect service of this provisional order upon all respondents.”

The application was vigorously opposed by the first respondent while the second respondent's response was that since no relief was being sought against it, it will abide by any decision of the court.

Mr Nyambirai, who took over from Mrs Zindi after the latter's indication that she was indisposed, opposed the application on five main planks. They are the following:

1. That the matter is not urgent;

2. That the draft order, even as amended, remains defective in that the interim relief sought is substantially the same as the final one;

3. Part of the relief sought is by way of interdict which, in effect, amounts to an interdict and the requirements of an interdict have not been met;

4. It is the applicants who repudiated the agreement and the case of Waste Management Services (Pvt) Ltd v City of Harare 2003 (1) ZLR 571 (S) relied upon by the applicants is distinguishable; and

5. In the event of a finding being made that the first respondent repudiated the agreement, so far as relief related to specific performance being sought is concerned, the court is urged to exercise its discretion and disallow specific performance.

I will deal with the five broad issues raised in opposition seriatim…,.

WHO REPUDIATED THE AGREEMENT

This seems to be the crux of the matter.

The first respondent's argument is that it was the first applicant which repudiated the agreement via its letter of 31 May 2011 whose “intention to terminate the agreement” the former “noted and accepted” via its letter dated 1 June 2011.

In Jackson v Unity Insurance Co. Ltd 1999 (1) ZLR 381 (S) GUBBAY CJ ,relying on the ratio in Ganief v Hoosen 1977 (4) SA 458 (C) held that a valid notice of cancellation must clearly inform the guilty party of the wronged party's unqualified, immediate and final decision to treat the contract as being at an end. The right to resile from the contract must be exercised immediately. What the landlord purported to do was to declare that the contract was to terminate at some future date and hold the tenant bound until that date arrived. Since this was not a valid notice of cancellation, ejectment could not be ordered.

The case which laid to rest the notion that a notice of cancellation which takes effect in the future is invalid only applies to contracts of lease is the one of Waste Management Services (Pvt) Ltd v City of Harare 2003 (1) ZLR 571 (S)…, where SANDURA JA with the concurrence of CHEDA JA said -

“It is pertinent to note that De KOCK J (in Ganief supra) referred to the right to resile from a contract and not the right to resile from a contract of lease. Had the intention been to restrict the principle to leases he would have said: 'In my view, the right to resile from a contract of lease is one that must be exercised ex nunc.' In any event, I cannot see any logical basis for restricting the principle to a contract of lease. In addition, it is clear from the judgment of this court in Jackson v Unity Insurance Co. Ltd 1999 (1) ZLR 381 (S) that the court was of the view that the principle in Ganief v Hoosen supra applied to the cancellation of any contract.”

A close look at the first applicant's letter of 31 May 2011, the basis upon which the first respondent purported to “note and accept” the intention to terminate the agreement by its letter of 1 June 2011, clearly shows that the notice to terminate the agreement was in the future. The pertinent paragraphs in the first applicant's letter of 31 May 2011 are 4 and the last one. Paragraph 4 reads:-

“Therefore, be advised that all obligations of Trustco will be suspended 3 June 2011 at 12hoo Namibian time if all overdue payments are not received by then.”

The penultimate paragraph reads:

“Kindly be further advised that if all overdue amounts, of which you have been advised, are not received within 14 days from date hereof Trustco will deem the contract cancelled in terms of Clause 17.1 of the main agreement.”

In the result, on the weight of the authorities cited above, the first applicant's notice of cancellation was in the future. The right to resile from the agreement was not exercised ex nunc therefore since the notice was not valid there was no cancellation which the first respondent could note and/or accept. In the event, the agreement still subsists, and by extension, the first respondent's 5^th plank of opposition, viz that in the event of the court finding that it was the first respondent who repudiated the agreement, the specific performance being sought by the applicants is in the court's discretion and the court should decline that relief, should not detain me. Having found that there was no valid cancellation of the agreement, and that the agreement is still alive, specific performance ought to be ordered to restore the status quo ante.

The application is accordingly granted in terms of the amended draft order.

HB65-13 : ANATOTH MINING (PVT) LTD vs BRIGHTON NYAMUCHO and GARLOREM RESOURCES (PVT) LTD t/a KIMS INVESTMENTS
Ruled By: KAMOCHA J

On 30 July 2012, the first respondent wrote a letter to the applicant purportedly to cancel the Tribute Agreement with the applicant. The purported cancellation was, however, contrary to the provisions of clause 10 of the Tribute Agreement between the parties which provides:- “(1) Should the Tributor commit any breach of the conditions of this agreement ...

HB158-13 : KERRIES ENGINEERING (PVT) LTD vs MAKOMO RESOURCES (PVT) LTD
Ruled By: MAKONESE J

2. Was the arrival of the plaintiff's crane at the defendant's mine on Thursday, 26th January 2012, a breach of the contract? The position is now settled in our law that: ''Notice of cancellation must be clear and unequivocal and takes effect from the time it is communicated to the other party.'' See R H CHRISTIE, The ...

HH338-14 : MAFIRAMBUDZI FAMILY TRUST vs LIBERTY MADZINGIRA and PANNAH NHIWATIWA and THE REGISTRAR OF DEEDS N.O. and THE SHERIFF
Ruled By: TAKUVA J

The first and second respondents also submitted, in their heads of argument that the applicant was in breach of the Agreement of Sale in that it failed to pay the purchase price in full. As regards this alleged breach of the Agreement, the first and second respondents raised this issue in both the notice of opposition ...

View Appeal
SC43-13 : ECONET WIRELESS (PVT) LTD vs TRUSTCO MOBILE (PROPRIETARY) LTD and TRUSTCO GROUP INTERNATIONAL (PROPRIETARY) LTD
Ruled By: MALABA DCJ, ZIYAMBI JA and GARWE JA

WHO BETWEEN THE PARTIES REPUDIATED THE AGREEMENT AND WHETHER THE APPELLANT LAWFULLY TERMINATED IT As correctly found by the court a quo, this is the axis of the matter between the two parties. In his submission, counsel for the appellant contended that on a proper reading of the letters of 31 May 2011 and 3 June ...

WHO BETWEEN THE PARTIES REPUDIATED THE AGREEMENT AND WHETHER THE APPELLANT LAWFULLY TERMINATED IT

As correctly found by the court a quo, this is the axis of the matter between the two parties.

In his submission, counsel for the appellant contended that on a proper reading of the letters of 31 May 2011 and 3 June 2011 from the first respondent's Group Managing Director, it is clear that the first respondent intended to resile from its obligations in terms of the agreement. That anticipatory or actual breach required the appellant to make an election either to accept the termination or to enforce the agreement. The appellant could have said “we do not accept your suspension of the contract and we hold you to it.” Instead, the appellant, firm in its conviction that it would not pay the disputed amounts, accepted the termination. Whether or not the termination by the respondent was valid or not was not relevant. Once the appellant accepted the repudiation this brought the agreement to an end. There would have been no further continuing obligations and the order made by the court a quo would therefore have been wrong. Whether or not the notice was to terminate the contract in future was irrelevant.

Counsel for the respondents, in his submissions, argued that it was the appellant that sought to repudiate the agreement. He accepted that repudiation is a species of anticipatory breach and that the innocent party has an election either to resist and sue for specific performance or, alternatively, accept the repudiation which then brings the contract to an end. It was the appellant in this case which sought to repudiate. The respondent did not accept the repudiation. Further, he submitted that as the threat to terminate the agreement by the respondent was not ex nunc but was to take place at a later date, and as the issue before the court was whether a prima facie case had been established, the court correctly granted the provisional order.

It is correct that in determining whether a party has repudiated a contract, the test to be applied is whether the party has acted in such a way as to lead a reasonable person to the conclusion that he did not intend to fulfil his part of the contract. It is also correct that repudiation is a species of anticipatory breach. See Chinyerere v Fraser N.O. 1994 (2) ZLR 234 (H).

Repudiation may manifest itself in a variety of ways. As stated by R.H. CHRISTIE, the Law of Contract in South Africa, 3^rd ed…,

“If it takes place before performance is due it is sometimes described as anticipatory breach and may take the form of a statement that the party concerned is not going to carry out the contract, or an unequivocal tender to perform less than is due, or an unwarranted but unequivocal refusal by a buyer to pay the full purchase price, irrespective of his true intention and the amount of any reduction that may be claimed, or the taking of some action inconsistent with the intention to perform, or by his own conduct putting it out of his power to perform…,.”

In his letter of 31 May 2011, the respondents' Group Managing Director wrote, inter alia:

“Therefore, be advised that all obligations of Trustco will be suspended on 3 June 2011 at 12h00 Namibian time if all overdue payments are not received by then.”

In my view, this was a clear intimation that the respondent, for the reasons given in the letter, was going to suspend all its obligations towards the appellant. The letter further made it clear that if all outstanding amounts were not paid within fourteen days of the date of the letter, the respondent was to deem the contract cancelled.

That this was an anticipatory breach there can be no doubt.

The procedure to be followed by either party in the event that it was believed that a breach had occurred at the instance of the other was clearly provided for in the agreement entered into and signed by both parties. Nowhere in the agreement was the respondent entitled to suspend all its obligations within three days of giving notice to that effect. Such conduct suggested that the respondent no longer believed it was bound by the agreement previously entered into by the parties.

The position is now settled that a party in the appellant's position has an election to make. The appellant could have refused or resisted such repudiation and insisted on specific performance. The appellant, in holding the respondent to the agreement, could have, inter alia, argued that the notice of termination was not ex nunc and therefore invalid. Alternatively, the appellant could have accepted the repudiation, such acceptance having the effect of terminating the agreement between the parties.

In its response, the appellant “noted the intention to terminate the agreement and accepted” it. It is apparent from the appellant's response that it accepted the repudiation. In my view, that brought the contract to an end. There were no further obligations as the contract had come an end. Therefore, when the first respondent wrote, on 3 June 2011, advising that on legal advice received it was not entitled to switch off the system until fourteen working days had lapsed and that the system would remain operational until then, it was too late as there no longer was any contract in existence between the two parties, a position the appellant stressed in its letter of 5 June 2011.

The court a quo found that the notice to terminate the agreement was in the future and not ex nunc. The court also found that in the circumstances there was no valid cancellation of the agreement and that the agreement therefore remained in existence.

The court erred in coming to the above conclusion.

It failed to consider the implications in our law of contract of the respondents' letter of 31 May 2011 and the response by the appellant of 1 June 2011 in which it accepted what it termed the termination of the agreement but which, in fact, was a repudiation of the agreement. Clearly, therefore, whilst Jackson v Limly Insurance Company Ltd 1999 (1) ZLR 381 (S) correctly stated the law when it held that a valid notice of cancellation must be exercised ex nunc, the issue that arises in this case is different.

I am satisfied, therefore, that the contract ceased to exist once the appellant accepted the first respondent's repudiation. In the circumstances, the order of specific performance granted by the court was improper and ought therefore to be set aside….,.

The appeal must therefore succeed.

In the result, it is ordered as follows:-

1. The appeal is allowed with costs.

2. The judgment of the court a quo is set aside and in its place the following substituted:-

“The application be and is hereby dismissed with costs.”

HH535-15 : BLESSMORE CHANAKIRA vs SHEPHERD MALCOM N.O. and REGISTRAR OF DEEDS and PHIL RUSCH
Ruled By: NDEWERE J

The background facts are that the plaintiff expressed interest in Stand 5233 Salisbury Township Lands measuring 3,309 square metres which is the property in dispute.The property belongs to the estate of the late Robert Eric Rae.An agreement of sale was concluded, on 22 October 2009, between the plaintiff and the ...

HH128-06 : DOBROCK HOLDINGS (PVT) LTD and TURNER AND SONS (PVT) LTD vs TURNER AND SONS (PVT) LTD and ANTHONY TURNER and MARTIN KING and ZAMBEZI PADDLE STEAMER (PVT) LTD and DOBROCK (PVT) LTD
Ruled By: KUDYA J

An order for the consolidation of these two matters was granted by UCHENA J, by consent, with no order as to costs, on 2 June 2006, for hearing before me on 7 June 2006 in Case Number 3157/06.

The first application, Case No. HC5186/05, concerns an order for specific performance while the second one, Case No.5264/05 seeks an order for the provisional liquidation of Zambezi Paddle Steamer (Pvt) Ltd (hereinafter called ZPS).

On 7 June 2006, at the request of the parties, I postponed the hearing to 13 July 2006.

When the hearing resumed, Mrs Wood, for Turner and Sons (Pvt) Ltd, applied for the forced recusal of Mr de Bourbon, for Dobrock (Pvt) Ltd, on the basis that he had been an arbitrator between these parties in 1994.

She referred to Pertisilis v Calaterra & Anor 1999 (1) ZLR 70 (H) as authority for the proposition that the legal practitioner who acted for a former client is precluded from representing a different client in circumstances where a conflict of interest is likely to arise between the former and present client. SMITH J set out the basis of the rule…, as being that:

“A legal practitioner who represents the adversary of his own client in litigation would clearly be violating his or her duty of loyalty and the common law rules against conflict of interest.”

He proceeded to survey American, English, South Africa, and Zimbabwean decided cases on the point at pages 74C–77F.

While he held that neither a partner nor his employee could represent an opponent of a former client in order to fulfill the adage that justice must not only be done but that it must manifestly and undoubtedly be seen to be done, he nevertheless permitted a partner to represent the opponent on the basis that there was no allegation that the other partner had acquired information from the papers in the possession of his firm which could be used to the former client's disadvantage.

Mrs Wood contended, that, justice will not be seen to be done if Mr de Bourbon was allowed to represent Dobrock (Pvt) Ltd, especially on the liquidation case, where Turner and Sons allege a deadlock has manifested itself between the joint shareholders, a fact found by Mr de Bourbon, as arbitrator, to exist in his 25 June 1994 ruling.

She further foresaw a need to call Mr de Bourbon on the deadlock issue in the liquidation case.

Mr de Bourbon countered by contending that he did not represent either Dobrock (Pvt) Ltd or Turner and Sons (Pvt) Ltd but acted in a quasi-judicial capacity.

He knew of no law which debarred him from representing either party as long as he had not possessed confidential information which could be used to the detriment of his client's adversary. He referred to Benmac Manufacturing (Pvt) Ltd v Angelique Enterprises (Pvt) Ltd 1988 (2) ZLR 52 (H).

In that case, Mr de Bourbon accepted a general retainer from Angelique Enterprises in a matter in which that company was involved in a dispute with Albco. He was, at that time, already seized with a retainer for Benmac Manufacturing in its contest with Angelique Enterprises, supra. He had accepted the retainer in the matter against Albco after assurance from his instructing attorney that there would be no conflict of interest.

It was accepted, in that case, by that attorney, that, he had not come into contact with any confidential information which would prejudice Angelique Enterprises in its contest with Benmac. The Law Society, and two other counsel, had absolved him of any impropriety, but, the Managing Director of Angelique Enterprise, Mr Holland, was not satisfied with their findings and advice.

REYNOLDS J held, that, Angelique Enterprises had not shown that Mr de Bourbon had in fact become acquainted with information that could be used to its detriment which would result in real mischief and real prejudice if he continued to act for Benmac Manufacturing. He did express his reservation on a legal practitioner acting for and against his client in the same or different matters.

Mr de Bourbon submitted that he had not acquired any information that he could possibly utilize to the prejudice of Turner and Sons (Pvt) Ltd and that his impartiality in 1994 had not been impugned by any of the parties.

I went through the arbitral award.

It concerned and dealt with the share of each joint shareholder in the extra costs, which were above the original cost of construction of the large commercial houseboat which Zambezi Paddle Steamer (Pvt) Ltd (ZPS) was to own.

Turner and Sons (Pvt) Ltd was not able to show what information Mr de Bourbon accessed which could prejudice its present defence and claim. If anything, I was satisfied that the arbitral award stands on its own and there would be no need to call the arbitrator to testify on it.

I accordingly dismissed the application for the forced withdrawal of Dobrock (Pvt) Ltd's counsel.

I also postponed the hearing sine die and granted, by consent, authority to Turner and Sons (Pvt) Ltd to file a further affidavit in response to Dobrock (Pvt) Ltd's supplementary affidavit.

I further reserved the question of costs in the provisional liquidation claim to which these additional affidavits pertained.

I eventually set down the matter for hearing on 1 November 2006. I directed that the parties argue the specific performance case first and thereafter proceed to argue the liquidation case.

On 12 October 2005, Dobrock (Pvt) Ltd filed the court application for specific performance against Turner and Sons (Pvt) Ltd and two others. It sought the following order:

“1. That, the respondents, jointly as well as severally, the one paying the other to be absolved shall forthwith undertake all that is necessary and required, including making all payments and completion and signing all documents required in order to procure transfer, without delay, by first respondent to applicant of first respondent's entire shareholding in Zambezi Paddle Steamer (Pvt) Ltd.

2. That, immediately upon registration of transfer in the share register of Zambezi Paddle Steamer (Pvt) Ltd (ZPS) applicant shall pay to first respondent the balance of the purchase price for the said shares; such balance being the sum of $138 million.

3. That, the respondents, jointly as well as severally, the one paying the other to be absolved, shall pay the costs of this application on the scale of legal practitioner and own client.”

The application was served on the three respondents on 13 October 2005 (see Peter Dobson's opposing affidavit of 9 November 2005 for which this averment was accepted by Antony Turner on 2 December 2005).

The three respondents filed their opposition papers on 27 October 2005 and prayed for the dismissal of the applicant's case with costs on the higher scale and made reference to the liquidation claim, case number HC5264/2005.

Case number 5264/05 is a court application brought on 17 October 2005 by Turner and Sons (Pvt) Ltd against Zambezi Paddle Steamer (Pvt) Ltd and Dobrock (Pvt) Ltd. It prayed for the winding up of Zambezi Paddle Steamer (Pvt) Ltd and that a liquidator be appointed in the following terms:

“1. That, first respondent, Zimbabwe Paddle Steamers (Pvt) Ltd be provisionally wound up pending the granting of an order in terms of paragraph 3 hereof or the discharge of this order.

2. That, Mrs Theresa Grimmel, of KPMG Chartered Accountants, Mutual Gardens, 100 The Chase, Emerald Hill, Harare be appointed as provisional liquidator of first respondent company with the powers set out in section 221 of the Act.

3. Any interested party appear before this court sitting at Harare on (a date sixty days from the date of the order) to show cause why an order should not be made placing first respondent's company in liquidation and order that the costs of these proceedings all be costs of the liquidation.

4. That, this order shall be published once in the Government Gazette and once in the Herald Newspaper. Publication shall be in the short form annexed to this order.

5. Any person intending to oppose or support the application on the return day of this order shall:

5.1. Give due notice to the applicant at Messrs Byron Venturas & Partners, 2nd Floor Tanganyika House, Corner 3rd Street/Kwame Nkrumah Avenue, Harare.

5.2. Serve on the applicant, at the address given above, a copy of any affidavit which he files with the Registrar of the High Court.”

The application for provisional liquidation was served on the respondents on 17 October 2005, who entered opposition on 31 October 2005 and filed, on that day, their opposing affidavit by fascimile. The actual opposing affidavit was filed on 9 November 2005.

These two applications were consolidated on the bases that the principal parties were the same and that the fundamental issue in each matter related to the ownership and management control of Zambezi Paddle Steamer (Pvt) Ltd (ZPS).

The pleadings in these consolidated matters are voluminous.

The founding, opposing, answering and supplementary affidavits are reinforced by an assortment of attachments which consists of the Memorandum of Association of Zambezi Paddle Steamer (Pvt) Ltd, electronic mail between the parties, and other documents raised by various people who worked for the parties in various capacities.

I have read all these documents.

It is apparent from these documents that there are areas in which the parties agree and others where they are at variance.

It is appropriate that I first deal with the facts as I have determined them to be from the wealth of information that is set out in the pleadings in both these cases.

The preliminary details on the formation of Zambezi Paddle Steamer (Pvt) Ltd (ZPS), on 3 April 1989, are set out in detail by Anthony Turner (Antony) in his founding affidavit in the liquidation matter, case HC5264/05 (Case No.2). Those details were admitted to by Peter Jameson Dobson (Peter) in his opposing affidavit in that case.

Turner and Sons (Pvt) Ltd agreed with Dobrock (Pvt) Ltd, in 1988, on a joint venture to construct and thereafter operate a 'Mississippi River Boat' for commercial use on Lake Kariba.

The concept of the “Southern Belle” was created by Turner and Sons (Pvt) Ltd who approached Dobrock (Pvt) Ltd.

Dobrock (Pvt) Ltd agreed to become its joint partner in the venture and to provide working capital and investment in the project.

Zambezi Paddle Steamer (Pvt) Ltd was incorporated as the special purpose vehicle through which the large commercial houseboat, MV Southern Belle, would be owned and operated.

Zambezi Paddle Steamer (Pvt) Ltd was incorporated in terms of the Companies Act [Chapter 24:03] with an issued share capital of $30,000 divided into 30,000 shares of $1 each fully paid up. Each of the two joint partners subscribed to 15,000 shares of $1 each in Zambezi Paddle Steamer (Pvt) Ltd.

The joint shareholders agreed that Turner and Sons (Pvt) Ltd would first build a model of the craft, and, thereafter, carryout the necessary construction work and interior design of the vessel at a contracted price. Dobrock (Pvt) Ltd would source both local and foreign raw materials for this construction. The total costs of both these operations would be the total cost of the vessel and would be met equally by the joint shareholders.

The agreement was reduced to writing and signed on 31 May 1991.

The arbitral award, of 15 June 1994, indicated that the vessel was completed in 1994. The original construction price was set at $5,950,000.

The issue before the arbitrator centred on the amount by which the original contract price increased, which issue he resolved.

Zambezi Paddle Steamer (Pvt) Ltd was run for 18 months, from the completion of the vessel in 1994, by Turner and Sons (Pvt) Ltd. Dobrock (Pvt) Ltd thereafter took over the management control of Zambezi Paddle Steamer (Pvt) Ltd and appointed a Managing Director, Adamson, to run it.

It was common cause, that, from 2000, the tourism industry went into decline and this affected the bottom line of the MV Southern Belle operations of Zambezi Paddle Steamer (Pvt) Ltd.

There is evidence, in the form of electronic mail exchanged between Peter Jameson Dobson and Anthony Turner, the principal shareholders in Dobrock (Pvt) Ltd and Turner and Sons (Pvt) Ltd, respectively, between 19 January 2003 and 7 April 2004, that, the joint shareholders were prepared to sell their respective shareholdings in Zambezi Paddle Steamer (Pvt) Ltd to the right suitor - if one came along.

On 4 May 2004, Zambezi Paddle Steamer (Pvt) Ltd Managing Director presented a report which highlighted the difficult circumstances the commercial houseboat operations were in. It required urgent maintenance and refurbishment to attain its former glittering glory.

On 6 June 2004, Anthony Turner indicated his decision to sell his shares in the commercial houseboat to Peter Jameson Dobson. This was a clear pointer to his unwillingness to inject funds for maintenance and refurbishment of the houseboat.

On 18 June 2004, Peter Jameson Dobson indicated his willingness to inject $250 million, for this purpose, provided his shareholding in Zambezi Paddle Steamer (Pvt) Ltd increased by 10% while that of Anthony Turner was reduced by the same percentage. He suggested that the houseboat was valued at approximately $3.5 billion. He followed up this by another e-mail of 25 June 2004.

He received a response on that same day (contained in an email wrongly dated as 6 June 2004) from Anthony Turner in which he offered him his shareholding in Zambezi Paddle Steamer (Pvt) Ltd for the sum of $250 million.

Peter Jameson Dobson duly accepted the offer.

He came to Harare, and, during the period 28 June to 14 July 2004, discussed with Anthony Turner on the terms of payment of Antony's entire shareholding.

He agreed to procure payment where and when Anthony Turner wanted.

The purchase price was agreed at $250 million. It was to be paid by Peter Jameson Dobson into the account of Antony's daughter, Jenny, in the United Kingdom, the bank account details of which he received.

The following day, after the terms of payment had been agreed, Anthony Turner requested part payment of the purchase price in local currency.

Peter Jameson Dobson alleged that he made out cheque payments to Chitekeshe of $115 million and to Vretto of $25 million, as part payment, a total of $140 million which Anthony Turner used to buy a pick-up truck.

This averment was not disputed by Anthony Turner, yet, he maintained, in his other affidavits, that, he was paid $138 million and $112 million remained outstanding.

Peter Jameson Dobson, in his prayer, and in Mr de Bourbon's submissions on behalf of Peter's company, accepted that the outstanding purchase price was $112 million.

No cheques or proof of payment in the sum of $140 million was produced.

I am therefore prepared to hold, that, Peter Jameson Dobson paid $138 million and had an outstanding balance of $112 million.

Anthony Turner averred, in his opposing affidavit, that, he required £12,000 to import a new engine for the craft that he was building, known as the “Zambezi Trader”. This craft would not be in competition with the houseboat at all and he was building it for his own account with the moral support and blessing of Peter Jameson Dobson.

Peter Jameson Dobson agreed to pay this amount into his daughter's bank account in the United Kingdom.

He repeated this allegation in paragraphs 31 and 32 of his founding affidavit in Case No. HC5264/05.

This was to be in lieu of the balance of the purchase price of $112 million.

In Case No. 5264/05, in paragraphs 26 and 27 of his opposing affidavit, Peter Jameson Dobson did not respond to these averments in so far as they refer to the alleged mode of payment in foreign currency.

That payment was to be in foreign currency is clear from Peter Jameson Dobson's own founding affidavit.

In paragraph 18, he averred, that, even when he met Anthony Turner, per chance, at the Borrowdale Race Course, in November 2004, he reassured him, that, notwithstanding the fall in the value of the Zimbabwean dollar against the Pound Sterling, the amount outstanding as the purchase price remained £12,000 being the amount in pounds in July 2004.

The two gentlemen agreed, that, the accountant and company secretary of Zambezi Paddle Steamer (Pvt) Ltd, Paul Turner (Paul), a partner in Ernst and Young Chartered Accountants, would effect the share transfer and receive Anthony Turner's letter of resignation as a director therein.

There was a delay in the transfer of the shares which was occasioned by Paul Turner's attempts to structure a tax avoidance scheme for the benefit and at the insistence of Antony Turner.

I make this finding based on Antony Turner's deliberate failure to respond to Paul Turner's affidavit, which was filed in support of Peter Jameson Dobson's founding affidavit.

It was agreed, that, on 3 August 2004 and 21 August 2004, Peter Jameson Dobson wrote to Anthony Turner enquiring whether or not he had signed the necessary transfer documents and resigned as a director of Zambezi Paddle Steamer (Pvt) Ltd - the two factors which would trigger the payment of the balance of the purchase price by Peter.

It also appears, that, even on 5 November 2004, a date disputed by Athony Turner, who put it as being sometime in September 2004, when the two met at Borrowdale Race Course, Antony intimated that he had been too busy to visit Paul Turner. The parties re-affirmed, that, despite an adverse movement of the Zimbabwe dollar since July 2004, the balance of the purchase price would be paid into Antony's daughter's account in the United Kingdom at the exchange rate agreed in July 2004.

On 17 January 2005, Antony Turner proceeded to appoint Peter Drummond and Martin King as directors of Turner & Sons (Pvt) Ltd, in his stead, who were charged with the responsibility of overseeing Turner & Sons (Pvt) Ltd's interests in the Southern Belle.

A flurry of e-mails followed which attempted to resolve the issue of the sale of Antony Turner's shares in Zambezi Paddle Steamer (Pvt) Ltd, who was claiming, that, the failure by Peter Jameson Dobson to pay the balance of the purchase price timeously amounted to repudiation of the contract.

He therefore regarded himself released from the contract.

The negotiations by the parties culminated in a letter of 23 August 2004 by Turner & Sons (Pvt) Ltd's erstwhile legal practitioners to Dobrock (Pvt) Ltd's legal practitioners which set out the history of their association.

In that letter, Turner & Sons (Pvt) Ltd indicated that it would seek an order to wind up the company in terms of section 206(g) of the Companies Act [Chapter 24:03].

Dobrock (Pvt) Ltd held the firm belief that it had purchased Turner & Sons shareholding and was therefore the sole shareholder in Zambezi Paddle Steamer (Pvt) Ltd.

These disagreements resulted in the two applications, for specific performance and liquidation, that are now before me.

The first issue for determination is whether or not a binding contract of sale was reached between Dobrock (Pvt) Ltd and Turner & Sons (Pvt) Ltd.

It is, I believe, common cause that an agreement of sale was entered into.

In its opposing affidavit, in paragraph 17, Turner & Sons (Pvt) Ltd acknowledges that the parties had a loose gentleman's agreement. Antony Turner concludes that paragraph by stating that "I believe, with respect, that the only explanation that is reasonable in the circumstances is that applicant repudiated the contract."

Paragraph 49(iii), in Case No. HC5264/05, by Turner & Sons (Pvt) Ltd, is to the same effect.

Turner & Sons (Pvt) Ltd's defence was, in the main, predicated on repudiation by conduct of the contract that was executed between the parties. Indeed, Mrs Wood, for Turner & Sons (Pvt) Ltd, in paragraph 2 of her written heads of argument, wrote:

"It is apparent from the applicant's own case that the agreement in question was very loose even if it was binding between the parties."

Counsel concentrated their submissions on the question whether time was of the essence in the performance by Dobrock (Pvt) Ltd of the term relating to payment of the outstanding purchase price.

It was on the assumption that it was of the essence that Turner & Sons (Pvt) Ltd alleged repudiation.

The onus, in my view, lies on Turner & Sons (Pvt) Ltd to show that time was of the essence and that the failure by Dobrock (Pvt) Ltd to act timeously entitled it to rescind the contract.

Turner & Sons (Pvt) Ltd blamed Dobrock (Pvt) Ltd for the delay in paying the balance of the purchase price.

The facts, as I find them, do not bear out the correctness of Turner & Sons (Pvt) Ltd's view.

Paul Turner indicated, in his unchallenged affidavit, that, the tax avoidance scheme was initiated at the instance of Antony Turner, and was for Turner & Sons (Pvt) Ltd's benefit.

My view is that, at that stage, Paul Turner was working as an agent of Turner & Sons. It became, in my finding, the duty of Turner & Sons to impress on him to act with speed if time was of the essence to it.

It is clear to me, that, Antony Turner understood and appreciated that the balance of the purchase price would not be paid out until the share transfer had been effected by Paul Turner; until Antony Turner had resigned as a director of Zambezi Paddle Steamer (Pvt) Ltd; and, until Antony Turner had obtained a capital gains clearance certificate from the Zimbabwe Revenue Authority (ZIMRA).

The delay cannot, therefore, be attributed to Dobrock (Pvt) Ltd.

Peter Jameson Dobson, after all, was desirous that transfer be effected with speed as shown by his enquiries of 4 August and 21 August 2004 which Antony Turner did not acknowledge.

Antony Turner never did challenge the averment, that, when they met at Borrowdale Race Course, he indicated that he was responsible for the delay for he was too busy to make a follow up with Paul Turner.

Paul Turner, after all, was acting, as regards the tax avoidance scheme only, as an agent of Antony Turner.

It is therefore my finding, on the papers, that, it was in fact Antony Turner who was responsible for the delay. He could not, therefore, lawfully repudiate the contract by projecting his own inaction onto Dobrock (Pvt) Ltd.

HH797-15 : PETER KAZINGIZI and THERESA MUCHABAIWA KAZINGIZI vs EQUITY PROPERTIES (PVT) LTD
Ruled By: MATHONSI J

How would one seek to cancel a non-existent agreement?

HB149-16 : MUNATSI SHOKO vs OLD MUTUAL ZIMBABWE LIMITED
Ruled By: MOYO J

It is trite law that once a contract has been entered into it can either be cancelled on notice as per the provisions of the agreement, or mutually by the parties, or through an order of the court - where mutual agreement cannot be reached.

HH114-15 : THEMPSON MUZVAGWANDOGA and DZOKAI MUZVAGWANDOGA vs MAI-KAI REAL ESTATE DEVELOPMENT TRUST and BERNARD MUTANGA and MOLLY DINGANI and THE REGISTRAR OF DEEDS
Ruled By: MAFUSIRE J

This case was a double sale situation. At this stage, I use the phrase “double sale” in a non-legal sense, simply to denote that the immovable property in question was sold twice by the same person to two different parties. Whether or not there was a double sale in the legal sense is one of the ...

This case was a double sale situation.

At this stage, I use the phrase “double sale” in a non-legal sense, simply to denote that the immovable property in question was sold twice by the same person to two different parties. Whether or not there was a double sale in the legal sense is one of the issues I shall have to decide.

The immovable property which was at the centre of the dispute was a subdivision in one of the low density suburbs of Harare (“the property”). The plaintiffs, husband and wife, were the first buyers (“the first sale”). The second buyer was the third defendant (“the second sale”). The seller was the first defendant, a Trust (hereafter referred to as “the trust” or “the seller” or “the developer”). The second defendant was both the founder or settlor and a trustee of the Trust. The other trustees were not disclosed….,.

In substance, the plaintiffs sought specific performance.

To get it they had to get rid of other legal impediments. They were these; the property had now been registered in the name of the third defendant; she said she had been an innocent buyer.

The plaintiffs disputed that. They accused her of having colluded with the second defendant to defraud them of the property. So they sought that the title deed in her name be cancelled.

On the other hand, the second defendant said the Trust had properly cancelled the first sale and that thereafter it had become free to conclude the second sale. The plaintiffs disputed that. So they sought an order declaring that their agreement, the first sale, be declared to be still subsisting.

By the time of the trial, some of the peripheral disputes had fallen away, the parties having streamlined the issues. Those issues were agreed upon as follows:

(i) Was the first sale validly cancelled?

The parties were agreed that, in terms of the first sale agreement, if the sale had validly been cancelled then the plaintiffs would be entitled to half the amount of the purchase price paid by the third defendant in the second sale. That amount was US$48,000=. So half of it was US$24,000=.

(ii) If the first sale was not validly cancelled, the parties agreed that the situation would be a double sale proper.

In that event, the court would have to determine in whose favour, between the plaintiffs and the third defendant, did the balance of equities lie. The party in whose favour the balance of equities lay would be entitled to the property and the other party to damages against the seller. The quantum of such damages would be the average of the two valuations commissioned by the parties; one in the sum of US$112,000= and the other in the sum of US$88,500=. Thus, such average would be US$100,250=.

Most of the facts were common cause. In fact, the parties filed a statement of agreed facts. Evidence was only led on the disputed areas….,.

(b) Was the first sale validly cancelled?

(i) Plaintiffs' case

Much of the dispute was on the aspect whether or not the first sale had been validly cancelled. The plaintiffs' story was told by the first plaintiff and their witness, Mrs Dorothy Kaseke (“Mrs Kaseke”). It was this. He and his wife bought the property in terms of an agreement of sale dated 12 September 2003. The land was vacant. They meant to build a dream home. The purchase price was ZW$75 million. They paid it in full. Soon after payment they took occupation. This was with the consent and blessing of the second defendant. Among other things, he gave them a letter authorising water connection to the property. They built a two bedroomed cottage up to roof level. The building plan had been approved by the City of Harare on 25 October 2004. A copy was produced. Loads of bricks were piled on the edge of the property. They also installed a wooden cabin on the property for their gardener-cum-caretaker who looked after the property. During the rainy seasons they grew maize. These details were thrown in to refute the third's defendant's story that when she visited the property for viewing she had seen no sign of human occupation. She said other than the pile of bricks, she had seen no cottage, no cabin or any maize crop.

The first plaintiff said there was no further contact from the first or second defendants after the agreement of sale. The onus had been on them to offer transfer in accordance with clause 3 of the Agreement of Sale. That clause provided, among other things, that the plaintiffs would execute the transfer documents within fourteen days of being required to do so by the developer. He said no such invitation had been extended - they had waited for over seven years.

The first plaintiff asserted that the seller had not been in a position to pass transfer because it was yet to comply with the numerous conditions of the subdivision permit. These related to, among others, the installation of a water reticulation and sewerage disposal system; provision of culverts, construction of roads; et cetera.

The first plaintiff said they got to know that the property had already been sold and transferred to the third defendant only in May 2010. In June 2010, their gardener-cum-caretaker advised them of visits by several people to the property who were coming for pre-purchase inspections. He said when they investigated they discovered that the third defendant had taken transfer of the property on 12 April 2010 and that she was now herself re-selling it. They discovered that the Trust had purported to cancel the first sale.

The first plaintiff said their gardener had given them an unsigned letter which had been dropped at the property. It was dated 22 June 2009. It was from the seller and addressed to his wife, the second plaintiff. The letter was produced in court. It commenced by quoting the clause in the Agreement of Sale that required the purchaser to pay all the rates and taxes on the property. It then advised that the developer, i.e. the Trust, had paid the capital gains tax, the rates, and the endowment fees (hereafter referred to as “the taxes”), on behalf of the plaintiffs, totalling US$4,000=, and that this had been done to expedite the transfer. The letter concluded by asking the plaintiffs to refund the money within fourteen days after which the developer would instruct its conveyancers to pass transfer to them. The address on the letter was the plaintiffs' domicilium citandi et executandi in terms of the Agreement of Sale.

The first plaintiff said they had never received that letter. Their domicilium address was a property that they had sold to Mrs Kaseke. She had lived there with her family since 2006. They had an arrangement with Mrs Kaseke to pass on their mail to them. Mrs Kaseke had previously testified, and would still come to testify, that at no stage had she received any mail for the plaintiffs ever since she had taken occupation of that address.

Further investigations by the plaintiffs and/or their attorneys established that on 7 May 2010, i.e. a month after the second sale and transfer of the property to the third defendant, the seller had obtained a default judgment in the Magistrate's Court against the second plaintiff, alone, purporting to cancel the first sale. The plaintiffs had proceeded to place a caveat on the property, rescind the default judgment and eventually have the Magistrate's Court proceedings dismissed for want of prosecution.

In court, the first plaintiff was referred to another letter from the Trust to the second plaintiff at the same domicilium address and dated 27 November 2009. That letter commenced by making reference to the previous one. It then proceeded as follows:

“We write with regret that you are in default of your obligations therefore the agreement entered between us have been cancelled; clauses 10, 11 and 14 of the agreement (sic). By copy of this letter we are advising our Legal Practitioners to take the necessary steps to give effect to cancellation.”

The first plaintiff's attention was also brought to a tax invoice from a mail delivery agency called, Courier Connect. The invoice had details of several items allegedly delivered to a number of people, one of them “M. Dzokai”. The date was 27 November 2009. The second defendant said that the invoice was the proof of delivery of the letter of 27 November 2009 that had cancelled the first sale agreement.

The first plaintiff denied that he or his wife had ever received that letter. He said the first time that they had seen the letter had been at the pre-trial conference.

The plaintiffs' witness, Mrs Kaseke, testified that ever since 2006 when they had moved into the plaintiff's previous residence, she and her family had continuously lived there. None of the members of her family had received any mail for the plaintiffs. In the Magistrate's Court case, the return of service in respect of the action for cancellation by the Trust had said that the summons had been served at that address on one Tapiwa, allegedly a cousin of the second plaintiff. Mrs Kaseke said she knew nobody by that name who had stayed with her at the property during that period or any other. The first plaintiff said neither he nor his wife had a relative by that name either.

In summary, the plaintiffs' evidence was that the first sale had never been properly cancelled. The purported cancellation alleged by the second defendant had not complied with the first sale agreement. That agreement had provided that if the purchasers fell in breach and remained in breach thirty days after a written notice sent by registered post, then the seller would be entitled to cancel and re-sell the property to someone else. The first plaintiff's case was that not only had the seller failed to give the requisite thirty days' notice to both him and his wife, as joint purchasers, but also that the letters that the second defendant had relied upon had not even been sent by pre-paid registered post. Regarding the Magistrate's Court proceedings, the first plaintiff's case was that they were a confirmation that the sellers knew that they had not validly cancelled the first sale and that all they wanted then was for a court to rubber stamp the fraud that they had already committed against him and his wife.

(ii) Defendants' case

The defendants' case was told by the second and third defendants. The second defendant produced evidence that by 5 December 2002, i.e. less than 3 months after obtaining the subdivision permit, the seller had complied with all the conditions of the permit save for minor adjustments that the City of Harare had pointed out. He said the seller had been ready to offer transfer soon after they had complied with the conditions of the subdivision but that the plaintiffs had been in default.

The second defendant said when the plaintiffs' case had started in this court he had obtained documents from the local authority that showed, among other things, that the plaintiffs had forged signatures to get approval for the building plans for their two-bedroomed cottage. He had never officially given the plaintiffs vacant occupation of the property.

The first sale agreement provided that the purchasers would be entitled to take vacant possession within fourteen days of “…, the date of registration of the Agreement.” The second defendant said the common understanding between the parties had been that “…, registration of the Agreement” meant registration of transfer. He said this had never been done.

Noting or implying that it was unreasonable for the plaintiffs to have waited for seven long years without as much as engaging him for transfer, the second defendant further pointed out that in terms of the first sale, only after the plaintiffs had fully complied with their monetary obligations would the conveyancers be instructed to offer them transfer. However, in spite of the seller having paid the taxes for them, and in spite of him having written to them seeking reimbursement, the plaintiffs had ignored or failed to comply. He had then taken steps to cancel the first sale. His evidence was that the notice letter and the subsequent cancellation one had properly been delivered at the plaintiffs' domicilium address. In terms of the first sale, a notice delivered by hand was deemed to have been received within 12 hours of such delivery. Therefore, so the second defendant argued, the plaintiffs must be deemed to have received the letters within the 12 hours of delivery by Courier Connect.

The second defendant said that the cottage that the plaintiffs claimed to have built on the property had not been approved by the local authority. Furthermore, the structure had become derelict. The property itself had become neglected. Among other things, it was overgrown with grass. Other than the pile of bricks, there was no evidence of occupation. Following the cancellation of the first sale he had caused the property to be advertised for re-sale. It was the third defendant who had eventually bought it and got transfer. Even though their own cancellation, as sellers, had been proper, he had nevertheless gone on to seek confirmation from the Magistrate's Courts.

The third defendant's evidence was that at no stage, prior to buying the property, had she been aware of the first sale. She had seen an advert in the press and had driven to the site for viewing. Other than the pile of bricks that the estate agent had expressly told her about, she had seen nothing else to suggest that the property was occupied. In particular, she never saw the cottage or the wooden cabin. The place was overgrown with tall grass. There was no maize crop. There was nobody around on the day of her visit. She had just driven around the property and had been satisfied. She had not come out of her vehicle.

The third defendant further testified that after her inspection of the property she had contacted her husband. They firmed up on the decision to buy. For the purchase price, she obtained a loan from her employer, a bank. The second sale was on 7 April 2010. On 12 April 2010, i.e. five days later, transfer had been registered in her name.

In a nutshell, that was the evidence before me on which I had to decide whether or not the first sale had validly been cancelled. The crucial question, in my view, is whether or not the alleged notice and cancellation letters, dated 22 June 2009 and 27 November 2009, complied with the Agreement of Sale. All other issues are diversionary side shows.

For example, it is curious that the plaintiffs would wait for seven years without as much as demanding transfer. Furthermore, the first plaintiff did not refute the second defendant's allegations that he had forged signatures on the application for approval of the building plan for their two-bedroomed cottage. Equally, given that by 2 December 2002 it had complied with virtually all the conditions of the subdivision permit, and, technically, would have been in a position to pass transfer to any of the buyers of the subdivisions, including the plaintiffs, the seller had waited for a number of years before seeking reimbursement of those taxes that they had paid on behalf of the plaintiffs. It is also equally curious that the third defendant, who had driven all the way to view the property, would simply make a cursory inspection from the comfort of her car and go back to expend US$48,000= in buying it. It does not sound right. Conveniently, she did not see the two-bedroomed cottage or the cabin, let alone anyone who could have been staying at the property. Furthermore, the third defendant took transfer in a record time. Within a space of about five days she had concluded the second sale agreement and taken transfer of the property in her name.

But all the above are enquiries that lead to nowhere. Admittedly, they raise eye-brows. But they do not help decide whether or not the first sale was validly cancelled. They may be relevant on the question of the credibility of the witnesses. However, I do not see the matter as being one dependent on the credibility of witnesses on the crucial question whether or not the letters of notice and cancellation aforesaid complied with the Agreement of Sale. I am satisfied that the facts that are common cause on the point are sufficient to decide the issue.

In my view, there was no valid cancellation of the first sale.

In my view, the sellers' two letters in question failed to comply with the Agreement of Sale. There are a number of reasons. In terms of the first sale agreement, the seller, as developer, could properly pay the taxes on behalf of the purchasers and properly seek to be refunded. And until the purchasers had fully complied with their monetary obligations, including, by parity of reasoning, the refund of those taxes, the seller would have had no obligation to tender transfer. So the seller, having paid the taxes on behalf of the plaintiffs, naturally had to notify them and formally seek to be refunded. Clause 16(b) of the Agreement of Sale read:

“Any notice to be given by either party in terms of this Agreement shall be in writing and addressed to the other party at its domicilium citandi et executandi chosen in paragraph (a) hereof or such alternative address in Zimbabwe as that party may from time to time specify in writing for such purpose. Any such notice shall be hand-delivered or sent by prepaid registered post to the address of the other party. A notice left by hand shall be deemed to have been received within 12 hours after it has been delivered and any notice sent by prepaid registered post shall be deemed to have been received 72 hours from time of posting provided that such period shall exclude Saturdays, Sundays and Public Holidays.”

At the hearing, none of the parties spent any time on the nature or proof of delivery of the first letter. I presume this was so because there simply was no evidence as to how and when that letter had been delivered. The invoice from Courier Connect, dated 27 November 2009, was said to relate to the second letter which bore the same date as the invoice. Therefore, there was no proof of delivery of the first letter. It was the second defendant that alleged that he had sent or caused the letter to be delivered.

The law says he who alleges must prove.

The first plaintiff vehemently denied they had received the letter. He said the first time he and his wife had got wind of it was in May 2010 when their gardener-cum-caretaker had given them an unsigned copy. That evidence was consistent with the second plaintiff's averments in her founding affidavit in January 2011 when she had sought rescission of judgment in the Magistrate's Court. It seems to me that whoever had eventually decided to send a copy of that letter to the property must have been convinced that the plaintiffs had never received the original that allegedly had been sent to their domicilium address.

The other problem with the first letter was that it could hardly be construed as the notice of cancellation in terms of clause 9 of the sale agreement as the second defendant implied or insinuated. That clause provided that if the purchaser failed to comply with any of the terms and conditions of the agreement, and remained in default for thirty days after the dispatch of a written “registered” notice “…, requiring such default to be remedied…,” then the developer would be entitled to re-sell the property and refund the purchaser 50% of the purchase price, with the developer retaining the balance as rouwkoop, and regain vacant possession of the property. Despite the imprecision of words used, I have no doubt that by “…, written registered notice…,” the parties meant pre-paid registered post in terms of clause 16(b).

The seller's first letter aforesaid was plainly a notice of the list and quantum of the taxes that it had paid on behalf of the plaintiffs and a request for a refund. Plainly, it was not a notice of cancellation of the agreement. Thus, the letter did not place the plaintiffs in mora regarding breach or cancellation. Furthermore, the letter gave the plaintiffs only fourteen days within which to pay. The agreement provided for thirty days' notice.

The second letter, of 27 November 2009, was purportedly the cancellation letter. It relied on the first letter. But since there was no evidence that the first letter had been delivered in accordance with the Agreement of Sale, or at all, and since the letter was in any event not the notice of breach required by the agreement, the second letter, or rather its purpose, was invalid. It stood on nothing. You cannot put something on nothing and expect it to stay there. It will collapse. Per LORD DENNING MR in Macfoy v United Africa Co. Ltd [1961] 3 ALL ER 1169.

As such, there is no need for me to decide whether the second letter was properly delivered in accordance with the Agreement of Sale.

It is on account of my findings above that I hold that the first sale was never validly cancelled…,.

1. The Agreement of Sale dated 12 September 2003, between the plaintiffs and the first defendant, in respect of the property that was then a subdivision of the Remaining Extent of Sherwood known as Stand 273, measuring 4,026m², but which is now registered as Stand 273 Philadelphia Township of Sherwood A (“the property”) was never validly cancelled.

HB157-16 : NRZ CONTRIBUTORY PENSION FUND vs JOSRO ENTERPRISES (PVT) LTD t/a ASCOT PUB & GRILL
Ruled By: TAKUVA J

The applicant's contention is that the respondent's refusal to sign a written lease agreement renewing the lease entered into on 20th October 2004, which expired on 30th November 2013, constitutes repudiation by the respondent of the landlord-and-tenant relationship between the parties. The basis of the applicant's contention is that from July 2013 it changed its real estate agents ...

The applicant's contention is that the respondent's refusal to sign a written lease agreement renewing the lease entered into on 20^th October 2004, which expired on 30^th November 2013, constitutes repudiation by the respondent of the landlord-and-tenant relationship between the parties.

The basis of the applicant's contention is that from July 2013 it changed its real estate agents from Knight Frank to John Pocock and Company (Pvt) Ltd. The agreement entered into by the parties, on the 20^th of October 2004, was prepared by Knight Frank. It became imperative that John Pocock and Company (Pvt) Ltd assume their mandate to administer the applicant's property at issue in terms of a written agreement prepared by them and not by Knight Frank. Thus, the expiry of the lease on the 30^th of November 2013 was the rightful opportunity to replace the Knight Frank lease agreement with one prepared by John Pocock & Co (Pvt) Ltd.

The respondent admitted that it refused to sign the lease but denied that this is tantamount to repudiation. It contends that once a written lease agreement expires, the tenant becomes a statutory tenant and the lease is automatically extended by operation of the law on the same terms and conditions as those which obtained under the expired lease.

It appears the respondent's contention is not applicable in casu because of the provisions of clause 3.5 of the lease agreement signed by the parties. It provides:

“If the tenant fails to give notice, as provided in this clause, this lease will continue from the termination date of the lease period (or the renewal period) on the same terms and conditions but subject to three calendar months written notice of termination by either party…,.”

In view of the above, there was no justifiable reason for the respondent's refusal to sign a renewal lease prepared by John Pocock and Company in November 2013. I take the view that such refusal constitutes a repudiation of the landlord-and-tenant contractual relationship between the parties.

In light of that, the applicant is entitled to accept the respondent's aforesaid repudiation.

Appealed
HH151-16 : SHORAI NZARA and ARROLA IDEHEN and AMOSOGE IDEHEN and OSARETIN IDEHEN and vs CECILIAH KASHUMBA N.O. and REGISTRAR OF DEEDS and MASTER OF THE HIGH COURT and TAFIRENYIKA KAMBARAMI
Ruled By: MAFUSIRE J

In terms of the Contractual Penalties Act [Chapter 8:04], no cancellation of an instalment sale of land on account of breach where the purchase price is paid over three or more instalments, or by way of a deposit and two or more instalments, is valid unless the purchaser is given not less than 30 days' notice, ...

HH63-13 : BLESSMORE Z. MABVURAMITI vs ALTFIN INSURANCE COMPANY
Ruled By: MAFUSIRE J

The plaintiff's argument, in the letter from his legal practitioners, seems to be confusing the issues of interpellatio and mora ex persona. Even though he accepts that he did not pay the last premium, the plaintiff insists on the contract being treated as having remained alive because, according to paragraph ...

The plaintiff's argument, in the letter from his legal practitioners, seems to be confusing the issues of interpellatio and mora ex persona. Even though he accepts that he did not pay the last premium, the plaintiff insists on the contract being treated as having remained alive because, according to paragraph 7 of the declaration, he “did not receive any correspondence from the defendant to inform him of the cancellation of the contract.”

In Asharia v Patel & Ors 1991 [2] ZLR 276 [SC] the Supreme Court held that where the performance of a contract has not been agreed upon between the parties, performance is due on conclusion or so soon thereafter as is reasonably possible. But, in that situation, the debtor does not fall into mora ipso facto. He must know he has to perform. This is known as mora ex persona. It only arises after interpellatio or demand.

In this case, interpellatio or demand on the plaintiff to pay his instalments was not necessary to place him in mora ex persona. By his own admission, the payment of the premium by him was the key to unlock the indemnity due by the defendant. The time for payment or performance had expressly been agreed upon. That the defendant may not have sent him correspondence about the cancellation of the contract does not change the legal position. If a party to a contract has committed a major breach of the contract the aggrieved party does not always have to go to the law; see KERR “The Principles of the Law of Contract”, 3^rd edition…,.. The aggrieved party is entitled to disregard the contract, wait for the defaulting party to sue and set up the default as a defence.

The above position is aptly summarised in a passage on pages 377 to 378 of KERR's book “The Principles of the Law of Contract”, 3^rd edition…,. It reads:

“If a party to a contract finds that the other party has committed a major breach of the contract he does not necessarily have to go to the law. If he is clearly in the right and does not desire to take any action at all he is entitled to disregard the contract. In such a case if he is sued on the contract by the other party that party's default is a complete defence. Thus, in Goldestein and Wolff v Maison Blanc [Pty] 1948 [4] 446 [C],defendant company in Cape Town placed an order for certain ladies' frocks to be dispatched to them from Johannesburg during the months of January or February 1945. They were in fact railed on 16 April 1945 and when the parcel was tendered to defendant in Cape Town it refused to accept it. The plaintiff then instituted action for the purchase price and tendered delivery. HERBSTEIN J found that time was of the essence of the contract [the goods being fashion goods which both parties knew were purchased for resale during a season limited in time] and that dispatch six or seven weeks late was not in compliance with the contract. He found too that;

'There was no obligation on the defendant, as alleged in the replication, to intimate at the end of February that it no longer required the goods. It was entitled to wait until delivery and then to repudiate (Federal Tobacco Works v Barron & Co, 1904 TS 483; Strachan & Co Ltd v Natal Milling Co [Pty] Ltd, 1936 NPD 376].'

This is in accordance with the rule enunciated many years ago by LORD BLACKBURN in The Mersey Steel and Iron Co. Ltd v Naylor Benzon & Co [1894] 9 AC 434 [HL] and adopted in our law:

'The rule of law…, is that where there is a contract in which there are two parties, each side having to do something…, if you see that the failure to perform one part of it goes to the root of the contract, goes to the foundation of the whole, it is a good defence to say, “I am not going to perform my part of it when that which is the root of the whole and the substantial consideration for my performance is defeated by your misconduct.'”

In an insurance contract, the failure to pay a premium goes to the root and is the very foundation of the contract. Contrary to the assertion by the plaintiff's legal practitioners, the breach was quite material. There was no question of quasi mutual assent. The defendant had repudiated liability.

Appealed
HH86-13 : GOLDEN MILLION ENGINEERING (PVT) LTD vs METTALON GOLD ZIMBABWE (PVT) LTD
Ruled By: KUDYA J

The third issue that was referred to trial was whether proper demand was made for payment before the issue of summons.It is clear to me that the letter of 21 November 2011 did not constitute a letter of demand. It did not set out the amount of indebtedness. It did ...

Appealed
SC05-18 : JENNIFER BROOKER and ADRIENNE PIERCE vs RICHARD MUDHANDA and THE REGISTRAR OF DEEDS
Ruled By: GOWORA JA, HLATSHWAYO JA and BHUNU JA

In Smart v Rhodesian Machine Tools Ltd 1950 (1) SA 735 (SR), TREDGOLD J…, accepted the general rule that where a contract fixes no time for performance, the debtor is not in mora until a reasonable time for performance has elapsed and the creditor has demanded performance. This principle, as stated above, was also highlighted in Asharia ...

View Appeal
HH637-15 : RICHARD MUDHANDA vs JENNIFER BROOKER and REGISTRAR OF DEEDS
Ruled By: MUREMBA J

In Asharia v Patel Others 1991 (2) ZLR 276 (SC)…, GUBBAY CJ said: “The general applicable rule is that where time for performance has not been agreed upon by the parties, performance is due immediately on conclusion of their contract or as soon thereafter as is reasonably possible in the circumstances. But the debtor does ...

Appealed
SC58-20 : YUSUF GAIBIE and MILLY GAIBIE N.O. vs ALEXANDER CASTANHEIRA and RACHEL CASTANHEIRA
Ruled By: GARWE JA, BHUNU JA and MAKONI JA

This is an appeal against the whole judgment of the High Court sitting at Bulawayo in which it granted absolution from the instance against the appellants' claim.FACTUAL BACKGROUNDThis is a contractual dispute. The appellants and the respondents entered into an Agreement of Sale in respect of a certain piece of ...

This is an appeal against the whole judgment of the High Court sitting at Bulawayo in which it granted absolution from the instance against the appellants' claim.

FACTUAL BACKGROUND

This is a contractual dispute. The appellants and the respondents entered into an Agreement of Sale in respect of a certain piece of land being Stand 710 Bulawayo Township in the District of Bulawayo known as Sunkist Flats situate at No.68 Samuel Parirenyatwa Street/Corner 6th Avenue, Bulawayo (“the property”).

In terms of the agreement, the purchase price of the property was in the sum of Z$11,500,000,000 (eleven billion five hundred million dollars) payable in instalments. The first instalment of Z$5,000,000,000 (five billion dollars) was to be paid upon signing of the agreement and was duly paid. The second instalment of Z$5,000,000,000 (five billion dollars) was payable by 27 January 2006 and the third instalment of Z$1,500,000,000 (one billion five hundred million dollars) upon the respondents taking occupation of the property.

On 27 January 2006, the respondents paid Z$1,800,000,000 (one billion eight hundred million dollars) instead of the agreed Z$5,000,000,000 (five billion dollars). After the respondents failed to pay the remaining amount within the stipulated time, the parties signed an addendum to the Agreement of Sale allowing the respondents an extension of time within which to pay the remaining amount.

It was signed by the parties on 16 February 2006 and it gave the respondents up to 28 February 2006 to pay the remaining balance. Pursuant thereto, the respondents made further payments.

It is common cause that by 28 February 2006 they had not cleared the amount outstanding. A further payment was made on 3 March 2006. By that date, a total of Z$9,200,000,000 (nine billion two hundred million dollars) had been paid by the respondents leaving a balance of $2,300,000,000 (two billion three hundred million dollars).

The respondents allegedly held on to this amount in the belief that the amount was to be paid to the sellers' conveyancers in terms of Clause 4.5 of the Agreement of Sale.

On 15 March 2006, the appellants wrote a letter to the respondents giving them 30 days' written notice to remedy their breach failing which the appellants would cancel the agreement. The letter further required the respondents to pay the sum of Z$2,300,000,000 (two billion three hundred million dollars) to their conveyancers, Messrs Baron & Partners, as provided for in the agreement as well as the outstanding interest charges as provided for in the addendum.

The respondents paid an additional amount of $1,200,000,000 (one billion two hundred million dollars). After getting no further response from the respondents pursuant to the letter of 15 March 2006, in respect of the outstanding amount, the appellants instituted proceedings in the court a quo against the respondents. They claimed cancellation of the Agreement of Sale. They tendered a refund of all the amounts paid as the purchase price as at the date of the summons. They further claimed costs of suit on the attorney and client scale in the event that the respondents opposed the matter.

The respondents denied breaching the Agreement of Sale and stated that they had complied with the agreement by paying the purchase price in full.

The matter was referred to trial on mainly two issues;

(i) The first issue was whether the defendants (the respondents) had breached the contract.

(ii) The other issue was whether the plaintiffs (the appellants) were entitled to cancel the agreement based on the defendants' breach.

The appellants gave evidence on their own behalf and closed their case.

Thereafter, the respondents applied for absolution from the instance arguing that the appellants had not proved a prima facie case as they had failed to prove any breach of the Agreement of Sale and a right to cancel the agreement.

On 5 July 2018, the court a quo granted the respondents' application for absolution from the instance reasoning that the plaintiff's case was full of glaring inconsistencies and unacceptable variances with the pleadings filed of record. It found that the appellants had failed, at the close of their case, to establish a prima facie case.

The appellants, aggrieved by that decision, filed the present appeal on the following grounds;

“GROUNDS OF APPEAL

1. The court a quo erred in law by granting absolution from the instance when the appellants had established a prima facie case of breach of contract by the respondents which breach entitled the appellants to cancel the contract.

2. The court a quo grossly misdirected itself on the facts by concluding that the appellants received the full purchase price set out in the contract when there was sufficient evidence to the contrary and no reasonable court, applying its mind to the evidence on record and the test for absolution from the instance, could have arrived at the same conclusion.

3. The court a quo grossly misdirected itself on the facts by concluding that the appellants had admitted that they had received the full market value of the property agreed upon at the time of contracting when there is no basis for such a conclusion and no reasonable court could have arrived at the same conclusion.

4. The court a quo erred in law by concluding that the appellants are not entitled to cancel the contract on account of breach by the respondents because the appellants allegedly breached the contract first, which alleged breach by the appellants was never pleaded by the respondents as a defence to the appellants` claim.

5. The court a quo erred in law by applying the contra preferentum rule against the appellants when there was no ambiguity at all as to the breach committed by the respondents and the appellants right to cancel the contract.”

Notwithstanding the number of grounds of appeal raised by the appellants, the court takes the view that the present appeal turns on the sole issue of whether or not the court a quo was correct in granting the application for absolution from the instance made by the respondents.

THE APPLICABLE LAW

The law to be applied in the present circumstances was eloquently articulated by MAKARAU JA in Competition and Tariff Commission v Iwayafrica Zimbabwe (Pvt) Ltd SC58-19…, where she said the following:

“[13] The law on when a court may grant absolution from the instance at the close of the plaintiff's case is settled. See Supreme Service Station (1969) (Private) Limited v Fox & Goodridge Limited 1971 (1) ZLR 1 (A) and United Air Charters (Private) Limited v Jarman 1994 (2) ZLR 341 (S). The court granting absolution must be satisfied that there is no evidence before it upon which a reasonable court might find for the plaintiff.

[14] Expressed differently, the court considering an application for absolution from the instance must ask itself if there is no evidence at all on each and every essential averment that the plaintiff must make to sustain the cause of action. If there is some evidence on all the essential averments, absolution should not be granted. If there is evidence on some, but not on all, the essential averments, absolution may be granted, for, in that instance, the plaintiff will not be able to sustain and perfect its cause of action. This is so because an application for absolution from the instance stands on pretty much the same footing as an application for the discharge of an accused person at the close of the State case albeit on a lower threshold of the burden of proof.

[15] It follows then that a court granting absolution must be clear on the essential averments that a plaintiff has to make to sustain the cause of action.”

See also United Air Charters (Pvt) Ltd v Jarman 1994 (2) ZLR 341 (S)…,.

APPLICATION OF THE LAW TO THE FACTS

In casu, it is common cause that the appellants' cause of action was breach of contract.

Clause 1.1 of the agreement, which regulated the purchase price and its payment, provided as follows:

“The purchase price of the property shall be the sum of $11,500,000,000 (eleven billion five hundred million dollars) which shall be payable in accordance with the provisions specified under Special Conditions elsewhere in this agreement.”

The relevant part of the Special Conditions clause provided as follows:

“4.2 THE FIRST PAYMENT in the sum of $5,000,000,000 (Five Billion Dollars) shall be payable upon signing of this agreement by RTGS transfer to an account to be advised.

4.3 THE SECOND PAYMENT in the sum of $5,000,000,000 (Five Billion Dollars) shall be payable on or before the 27th January 2006 by RTGS transfer to an account to be advised, else the Midrate applies thereafter.

4.4 THE THIRD PAYMENT in the sum of $1,500,000,000 (One Billion Five Hundred Million) shall be payable on the Purchaser obtaining occupation of the property.

4.5 The two parties agree that any amounts paid shall be immediately released to the sellers save for any amounts required by law to be of the Conveyancers on account of Capital Gains Tax.

…,.

4.8 In the event that the sum of $10,000,000,000 (Ten Billion Dollars) deposit shall not have been paid in full by the 10th February 2006 the Sellers shall have the right to cancel the Agreement forthwith notwithstanding to the contrary containing this Agreement.”

The addendum to the agreement granted the respondent extension of time to pay the outstanding amount by 28 February 2006.

The appellants argue that the second instalment of Z$5,000,000,000 (five billion dollars) was not paid in full as was required by the agreement and that the respondents only paid Z$1,800,000,000 (one billion eight hundred million dollars) thus leaving a balance of Z$3,200,000,000 (three billion two hundred million dollars). The second instalment ought to have been paid by 27 January 2006.

The respondents do not deny this but seek to aver that the addendum to the agreement granted them an extension to pay the outstanding amounts by 28 February 2006.

While that may be true, it is also correct that by the time the extension provided by the addendum had expired, the respondents had not yet paid the full Z$11,500,000,000 (eleven billion five hundred million dollars) as required by the agreement of sale as read with the addendum. Instead, they had only managed to pay Z$9,200,000,000 (nine billion two hundred million dollars) leaving a balance of Z$2,300,000,000 (two billion three hundred million dollars).

The last payment towards the purchase price was paid on 14 July 2006.

In addition, it is common cause that on 15 March 2006 the appellants wrote to the respondents giving them 30 days' notice in which to pay the outstanding amounts - which they failed to do.

The respondents argued that they paid the purchase price in full to the second respondent's account. The balance of Z$2,300,000,000 (two billion three hundred million dollars) was to be paid to the appellants' conveyancers. By the time the appellants issued summons they (the appellants) had not opened a file with their conveyancers.

It is this Court's view that the respondents have to explain why they failed to pay the amount they claimed was due to the conveyancers upon being advised of the identity of the conveyancers.

It is common cause that the respondents attempted to pay by cheque and it was returned by the Bank in April 2006. It was not clear why the cheque was returned.

Regarding the issue of whether the appellants were entitled to cancel the agreement, it is this Court's view that it is a question of interpretation of the agreement as read with the addendum. This can only be done after the court would have heard evidence from both sides.

As it is, the Court has heard the appellants' side only.

In this vein, therefore, the appellants established a prima facie case of breach of the agreement by the respondents. The full amount, as stated in the agreement, had not been paid at the time of issuance of the summons.

Once evidence has been adduced which constitutes prima facie proof of breach, then, such evidence may become proof, on a preponderance of probabilities, and a plaintiff will succeed in proving his or her case. The courts must be slow to grant absolution from the instance and this point was made in Katerere v Standard Chartered Bank Zimbabwe Ltd HB51-08 which was quoted with approval in Bakari v Total Zimbabwe (Pvt) Ltd SC21-19. It was stated that:

“The court should be extremely chary of granting absolution at the close of the plaintiff's case. The court must assume that, in the absence of very special considerations, such as the inherent unacceptability of the evidence adduced, the evidence is true. The court should not, at this stage, evaluate and reject the plaintiff's evidence. The test to be applied is not whether the evidence led by the plaintiff establishes what will finally have to be established. Absolution from the instance at the close of the plaintiff's case may be granted if the plaintiff has failed to establish an essential element of his claim - Claude Neon Lights (SA) Ltd v Daniel 1976 (4) SA 403 (A); Marine & Trade Insurance Co Ltd v Van Der Schyff 1972 (1) SA 26 (A); Sithole v PG Industries (Pvt) Ltd HB47-05.”

The same point had been made earlier on in Manyange v Mpofu & Ors 2011 (2) ZLR 87 (H)…, where it was stated that;

“The test to be applied as to whether to grant absolution is not whether the evidence for the plaintiff establishes what would finally be required to be established to obtain judgment. It is whether the plaintiff has made out a prima facie case against the defendant on the basis of which the court could or might find for the plaintiff. A reticent defendant should not be allowed to shelter behind the procedure of absolution from the instance. In practice, the courts are loathe to decide upon questions of fact without hearing all the evidence from both sides, and have usually inclined towards allowing the case to proceed. At this stage of the trial, it is not pertinent to evaluate the weight of the evidence adduced or the preponderance of probabilities, save where such findings are manifest from the evidence already heard.”

See also Chombo v Minister of Safety and Security (I3883/2013) [2018] NAHCMD 37.

It bears mention that the appellants only had to prove a prima facie case and their evidence a quo cannot be characterized as having been manifestly unsatisfactory, unreliable, or that it failed to establish an essential element of the claim. An arguable case was made out and the respondents ought to have been put to their defence.

At the hearing of the matter, counsel for the appellants sought to argue that the court a quo did not apply its mind to the matter that was before it for the reason that the judgment of the court a quo is a regurgitation of the respondents (then defendants a quo) submissions. He submitted that the court a quo simply adopted the evidence and submissions of the respondents without independently assessing it and without having regard to the appellants' submissions.

Per contra, counsel for the respondents argued that this was not an issue that had been raised in the grounds of appeal and thus could not be properly raised for the first time at this hearing.

On the merits, she argued that the court a quo did not produce a biased decision and for authority she relied on the case of Stuttafords Stores (Pty) Ltd and Others v Salt of the Earth Creations (Pty) Ltd 2011 (1) SA 267 (CC).

In that case, the Constitutional Court of South Africa, in no uncertain terms, refrained from determining the question whether the extensive use of counsel's heads of argument could lead to a perception of bias because it was not a question before it. It merely expressed its views on such conduct. The views are obiter and not binding.

However, in casu, it is apparent that the court a quo did not regurgitate the submissions made by the respondents in the court a quo. There are differences between the submissions and the final judgment. As a result, the court takes the view that while it may be undesirable for a court to plagiarize counsel's heads of argument in a judgment, this does not necessarily, without more, amount to a misdirection.

DISPOSITION

The appellants have managed to establish that the court a quo misdirected itself in granting absolution from the instance when the appellants had established a prima facie case. The appeal has merit and must succeed.

Accordingly, it is ordered as follows:

1. The appeal be and is hereby allowed with costs.

2. The judgment of the court a quo is set aside and substituted with the following:

“The application for absolution from the instance be and is hereby dismissed.”

View Appeal
HB179-18 : YUSUF GAIBIE and MAHMOUD GAIBIE vs ALEXANDER CASTANHEIRA and RACHEL CASTANHEIRA
Ruled By: MAKONESE J

The defendants have made an application for absolution from the instance at the close of the plaintiffs case.

The defendants contend that the plaintiffs had failed to lead evidence upon which a court might find in favour of their claims. The application is made on the basis that an essential of the claim, an alleged breach of contract, was not proved in sufficient evidence. Further, the plaintiffs alleged right to cancel the agreement was not proved. The defendants aver that the evidence led by the plaintiffs was fraught with glaring inconsistencies and unacceptable variance with the plaintiffs' pleaded case.

The plaintiffs are opposing the application for absolution from the instance.

The plaintiffs' aver that taking into account the applicable law, and evaluating all the evidence adduced on behalf of the plaintiffs, the pleadings filed of record, the exhibits, and all the discovered documents as well as the viva voce evidence, the application for absolution from the instance is unsustainable and ought to fail with costs.

The plaintiffs aver that they have established a prima facie case of breach of contract and the plaintiffs' right to cancel the contract as a result of such breach. The plaintiffs alleged that the application for absolution from the instance is premised on a mis-interpretation of the terms of the Agreement of Sale, as amended, and a misconception of the consequences at law of the defendants' failure to pay the full purchase price after they were called upon to remedy their breach.

The Factual Background

On the 25th of January 2006 the parties entered into an Agreement of Sale in terms of which the plaintiffs sold to the defendants an immovable property for the agreed price of Z$11,5 billion, subject to certain terms and conditions as set out in the agreement. The plaintiffs alleged that the defendants breached the agreement by failing to pay the purchase price in full despite the extension of time to pay by the 28th of February 2006 in terms of an addendum to the Agreement of Sale signed on the 16th of February 2006.

The defendants deny having breached the agreement of sale and state that they have paid the purchase price in full. They aver that the Capital Gains Tax was paid to the plaintiffs' legal practitioners, who, incidentally, were also the defendants' legal practitioners at the relevant time in accordance with the Agreement of Sale.

The joint pre-trial conference memorandum filed by the parties' legal practitioners set out the following issues for trial;

1. Whether the defendants are in breach of contract.

2. Whether the plaintiffs' cancellation of the Agreement of Sale was in terms of the Contractual Penalties Act [Chapter 8:04].

3. Whether the plaintiffs' attempted to restitute the amount paid by the defendants towards the sale due to breach.

4. Whether the plaintiffs are entitled to cancel the agreement based on the defendants' breach of contract.

5. The onus on the plaintiffs on all the issues.

The Pleadings and Burden of Proof

This being a cause based on breach of contract, the onus of proof rests on the plaintiff to prove breach and the nature thereof. The plaintiffs not only have to allege breach in sufficiently clear terms in their pleadings, but also to prove such breach in evidence. In their pleadings, the plaintiffs allege breach in the following respects:

(a) Failure by the defendants to pay a balance of Z$1,2 billion.

(b) Failure by the defendants to pay the sum of Z$2,3 billion to the conveyancers. The breach, as alleged, is mentioned in paragraphs 4, 5, 6, 7 and 9 of the declaration.

(c) Failure to pay interest in the sum of Z$54,208,814.

In their plea, the defendants denied breaching the terms of the agreement and contend that they have complied fully with the Agreement of Sale.

Assessment of evidence

The plaintiffs filed both the Agreement of Sale and the addendum as part of their case. During the course of the proceedings, the plaintiffs also produced, as exhibit 2a, a schedule showing the defendants' payments totaling Z$9,2 billion made to the first plaintiff, and exhibit 3, a letter from Joel Pincus, Konson and Wolhuter, legal practitioners who were then legal practitioners for the plaintiffs.

The plaintiffs led oral evidence from two witnesses. The first plaintiff confirmed, wholesale, together with all and any defects therein, the evidence, beliefs, and recollections of the second plaintiff.

The evidence of the first plaintiff that he confirmed and adopted the evidence of the second plaintiff was of little probative value to the court.

The first plaintiff had no independent recollection of the matter and did not corroborate the second plaintiff's evidence in any material respects.

It has to be noted that corroboration can only be supplied by independent evidence of a witness giving independent recollections of an incident at issue.

Only one question was put to the first plaintiff, under cross-examination, which question elicited new evidence from the witness. The following exchange occurred between the first plaintiff and the defendants' legal practitioners;

“Q. Who is the registered owner of the property?

A. I am. I gave it to my brother, but I am not the registered owner.”

The only independent aspect of the witness' evidence was that he and not the second plaintiff, and not him and the second plaintiff is the registered owner of the property. The witness, under cross examination, suddenly wept copiously in court. He then informed the court that he and his father had worked hard to acquire the building at issue. He indicated that it was not proper for the property, to “just go like that”. The witness asked the court for a “good judgment”. The first plaintiff certainly displayed his emotions in a rather exaggerated manner.

The second plaintiff gave evidence central to the plaintiffs' claims. He was the single and key witness in this matter.

Clause 1.2 of the Agreement of Sale provides as follows:

“It is recorded herein that the purchase price has been determined and agreed in the context of the prevailing Midrate of Exchange between the Zimbabwean and United States Dollar…,.”

The second plaintiff confirmed that the price was set by him at an equivalent of US$120,000 which was a reasonable price and acceptable to him at the time. The second plaintiff accepted that the midrate only changed between 25 and 3 March 2006.

The suggestion that the purchase price was eroded by the slide of the Zimbabwean dollar, in a period of two months, is baseless.

The second plaintiff confirmed that he signed both the Agreement of Sale and the addendum and he signed both in his own name, and on behalf of the first plaintiff. This is evident from an examination of both documents.

The second plaintiff testified that he co-owns the building with the first plaintiff.

The witness testified that the defendants failed to pay the purchase price by the 27th of January 2006 as stipulated in the Agreement of Sale. Initially, the witness stated that he tried to pursue the defendants to no avail. He stated, further, that upon chasing the defendants he reached no agreement with them. He later conceded that he had signed the addendum with the defendants. After the addendum was signed the witness averred that the defendants were given up to the 28th of February 2006 to settle the balance.

By 28 February, the defendants had not paid the entire purchase price.

He then approached his lawyers who issued a notice to remedy the breach. By the time the notice and demand was issued, the defendants had paid a total of Z$9,2 billion. Such payments were recorded and agreed by the parties prior to issuance of summons.

The witness affirmed that his claim was for cancellation of the contract and that he was tendering a refund of all monies paid by the defendants against such cancellation.

Under cross-examination, an entirely different picture began to emerge.

The plaintiff was moving away and in some instances contradicting his initial evidence. The witness sought to allege that when the addendum was signed, on 16 February 2006, the defendants had already breached the Agreement of Sale by failing to pay the sum of Z$10 billion into his account by 27 January 2006. The witness admitted that, on the face of it, the addendum did not give the sellers the right to cancel the agreement on account of non-payment with the extended time limits. The witness conceded that the addendum gave the sellers the right to levy interest at the rate of 80% or at the NMB Bank investment rate for any further delays in paying off the purchase price. The witness emphatically denied, under cross examination, that he had advised the defendants how much they needed to pay on account of Capital Gains Tax, to the nominated conveyancers, Ben Baron & Partners. The witness repeatedly disputed that the figure of Z$2.3 billion as the amount of Capital Gains Tax in spite of a demand having been made to settle that amount. When it was put to the witness that his lawyers had pleaded on his behalf that Capital Gains Tax was in the sum of Z$2,3 billion the witness stood firm that there was no way he could calculate and demand capital gains tax from the defendants.

Under cross-examination, the witness contradicted his pleadings on the amount, excluding capital gains tax, which remained due to him under the agreement. He pleaded mistakes in the calculations.

The witness further contradicted the terms of the Agreement of Sale and the addendum in material respects.

One glaring contradiction is that the witness sought to argue that capital gains tax was not, contrary to clause 4.5 of the Agreement of Sale, and contrary to the wording of the notice and demand written by his legal practitioners, and the pleadings on record, payable directly to the conveyancers. The witness kept insisting that the money was his money and that it should have been paid to him. Later, in his cross-examination, the witness had departed from his earlier evidence and sought to assert that he had indeed “estimated” capital gains tax in the sum of Z$2,3 billion.

The witness conceded that, up to the time demand was made by his legal practitioners, he had not opened a file at Ben Baron & Partners or supplied the firm with an irrevocable power of attorney as required by the Agreement of Sale.

The witness conceded that the following payments were made to the plaintiffs by the defendant:

(a) Z$9.2 billion into the first plaintiff's account which was nominated in the Agreement of Sale.

(b) Z$2,3 billion in various instalments to Joel Pincus, Konson and Wolhuter.

(c) Z$54,208,844 on account of interest to Joel Pincus, Konson and Wolhuter.

It was accepted, by the second plaintiff, that at the time the last two payments were made, the plaintiffs still did not have an account with the nominated conveyancers for payment of capital gains tax.

Sufficiency of evidence at the close of plaintiffs case

The defendants argue that at the close of the plaintiffs case the plaintiffs failed to lead evidence upon which a court might return a judgment in their favour.

The plaintiffs, however, do not agree.

The plaintiffs urge the court to dismiss the application for absolution from the instance as it is wholly without merit. The plaintiffs argue that they have made a prima facie case for breach of contract, entitling them to cancel the Agreement of Sale. Further, it is alleged by the plaintiffs that there is abundant evidence upon which a court, directing its mind reasonably to such evidence, could or might find for the plaintiffs.

I shall examine the sufficiency or otherwise of the evidence presented by the plaintiffs at the close of their case.

(a) Firstly, the breach of contract pleaded by the plaintiffs was not proved.

In his evidence, the second plaintiff could not explain how the sum of Z$1,2 billion which was stated in his pleadings, and which the defendants were said had failed to pay was calculated or arrived at. The defendants are alleged to have failed to pay such amount in the plaintiffs' pleadings. That the plaintiffs relied on the defendants' failure to pay that amount is clear from the plaintiffs' declaration, which states, in paragraph 4, as follows:

“In breach of the aforesaid terms of the agreement, defendants only paid the plaintiffs' the amounts detailed in annexure 'B' hereto, leaving a balance of $1,200,000,000 plus accumulated interest on all outstanding amount.”

The obligation to pay the sum of Z$1,2 billion, which was termed a material breach, was not proved nor explained by the plaintiffs at all.

(b) Secondly, in their pleadings, the plaintiffs based their allegations of breach of contract upon the alleged failure by the defendants to pay the sum of Z$2,3 billion in respect of Capital Gains Tax on time and as provided under the Agreement of Sale.

In his evidence, the second plaintiff conceded that after payment of Z$9,2 billion into the second plaintiff's account, the defendants met with a Mr Lunat, the plaintiffs accountant, and enquired about the plaintiffs representation at Ben Baron & Partners. What was admitted, however, was that when the defendants intended to pay the Capital Gains Tax, the plaintiffs had no file or account at the nominated conveyancers. It was therefore not possible for the defendants to pay the amount at the offices of the seller's nominated conveyancers.

In the event, the plaintiffs cannot be allowed to rely on the delay in payment of Capital Gains Tax. To do so would be tantamount to allowing the plaintiffs to benefit from their own tardiness or wrongdoing which is not permissible at law.

(c) Thirdly, the plaintiffs, according to their own admission, were in breach of the contract.

Under cross-examination, the second plaintiff conceded that the plaintiffs were in breach of clause 4.7 of the agreement of sale which provides as follows:

“Upon signing of this agreement, the sellers shall furnish the conveyancers herein with an irrevocable power of attorney authorising them to do all such things and sign all such papers as might be necessary to give effect to the transfer.”

The plaintiffs, having breached the terms of the Agreement of Sale, which breach occurred prior to the alleged breach by the defendants, ought not to be permitted to profit from such breach. See Chioza v Siziba SC04-15 where the Supreme Court held that:

“It will seem quite clear that the appellant seeks to benefit unjustly from the transaction. Having sold the property and received the proceeds through his agent, he now seeks the return of the property and thus, so to speak, 'have his cake and eat it'. The respondent, on the other hand, has parted with the full value of the property and stands to incur great financial prejudice if an order for eviction is granted in terms of the counter claim. It would appear then, that the court a quo was correct in its finding that the appellant sought to benefit from its own wrongdoing…,.”

In this instance, the plaintiffs admittedly received the full market value of the property, as set out and accepted by them as at the time of the sale. I make the observation that the plaintiffs ensured that the fluctuating Zimbabwean dollar was pegged at the mid-rate of the United States dollar at the relevant time.

The plaintiffs received the full purchase price for the property.

It is crucial to note that the addendum to the Agreement of Sale provided for a punitive rate of interest of 800% for any late payment.

The second plaintiff, under re-examination, sought to clarify his case on the alleged breach. He stated that there were various instances of breach, the first occurring on the failure to pay by the 27th of January 2006, the second one by failure to pay by the 28th of February 2006 following the delivery of the demand.

The plaintiffs' evidence was clearly at variance with the pleaded cause of action.

The evidence was also contrary to any correct reading of the addendum.

Under re-examination, the second plaintiff stated that, by the end of the notice period, only Z$9,2 billion had been paid to him out of Z$11,5 billion. The defendants had indeed paid the total amount, exclusive of Capital Gains Tax. The witness made reference to a failure to pay Z$10 billion by the 27th of January 2006. This argument presents an inconsistency in the contract of sale.

Under clause 4.2 and 4.3, a total of Z$10 billion was to be paid into an account nominated by the sellers. This account turned out to be the sellers personal account. In terms of clause 4.4 of the agreement the last payment of Z$1,5 billion was only to be made upon the buyers obtaining occupation. The second plaintiff could not state when occupation was taken by the defendants, but conceded that this could not have been in November 2006. No interest, therefore, would have become due and payable before the last payment of Z$1.5 billion became due. Clause 4.5 inconsistently required that the amount required for Capital Gains Tax was to be held by the conveyancers. The pleadings allege that this amount was Z$2,3 billion. Given the amount, it becomes difficult to determine how the defendants could be said to have failed to pay Z$10 billion to the second plaintiff. The amount, less the Z$2,3 billon, came to Z$9,2 billion which was admittedly paid to the plaintiffs.

The second plaintiff conceded that the Agreement of Sale was drafted by himself.

It follows that the second plaintiff is the proferens in this matter, therefore, by operation of the contra proferentem sale, any obscurity, vagueness and lack of clarity around the issue of what clause was breached must be resolved against the plaintiffs; see Blumo Trading (Pvt) Ltd v Nelmah Milling Co and Anor HH39-11.

In concluding the analysis of the evidence led by the plaintiffs, I find that the plaintiffs' evidence fell far short of establishing a prima facie case for breach of contract.

The plaintiffs' evidence was so discredited under cross-examination that no reasonable court examining the evidence could or might find in its favour. The plaintiffs' pleaded case contradicted the viva voce evidence in material respects. The alleged breach was not established.

The second plaintiff departed from the pleaded case in several respects. His evidence is not reliable.

By choosing to extend the true limits, and signing an addendum to provide expressly for penalties for late payment and not reserving the right to cancel the Agreement of Sale, the plaintiff exercised an election to remain in the agreement and to receive the full market value for the property.

There is sufficient evidence that the plaintiffs received, in full, the value of the property at the relevant time, pegged against the United States midrate at the time. The plaintiff is attempting to have his cake and eat it at the same time.

The Law applicable

One of the leading case law authority, in this jurisdiction, on the test to be applied when deciding whether to grant an application for absolution from the instance at the close of the plaintiffs' case is United Air Charters (Pvt) Ltd v Jarman 1994 (2) ZLR 341 where GUBBAY CJ stated as follows…,;

“The test in deciding an application for absolution from the instance is well settled in the jurisdiction. A plaintiff will successfully withstand such an application, if, at the close of his case, there is evidence upon which a court, directing its mind reasonably to such evidence, could or might (not should or ought to) find for him…,. Moreover, in considering an application for absolution, the court should lean favour of continuing the case rather the dismissing it…,.”

See; Claude Neon Lights (SA) Ltd v Daniel 1976 (4) SA 403 (AD) and Manyange v Mpofu & Ors 2011 (2) ZLR 87 (H).

The test to be applied in this instance is whether, at the close of the plaintiffs' case, there is any evidence upon which the court, directing its mind reasonably to such evidence, could or might find in favour of the plaintiffs. The court must also examine whether the plaintiff has failed to adduce any evidence or adduced insufficient evidence to establish an essential element of the claim. The court is enjoined to make an overall assessment of all the evidence adduced on behalf of the plaintiffs and the pleadings filed of record together with exhibits and annexures, as well as viva voce evidence to establish whether the evidence is sufficient to proceed to hear the case for the defendants.

I am satisfied, that, in applying the applicable law to the facts of this dispute, it becomes evident that the plaintiffs case is full of glaring inconsistencies and unacceptable variance with the pleadings filed of record. The second plaintiffs' evidence, by all accounts, was at direct variance with the pleadings. The plaintiffs sought to correct his evidence under re-examination. The net result was that this court concluded that the plaintiffs failed, at the close of the plaintiffs' case, to establish a prima facie case.

In the result, and accordingly, absolution from the instance is granted. The plaintiffs are ordered to pay costs of suit.

SC107-20 : COLCOM FOODS LIMITED vs TARUVA TARUVA
Ruled By: GWAUNZA DCJ, GUVAVA JA and MATHONSI JA

This is an appeal against the whole judgment of the Labour Court handed down on 1 June 2018 dismissing, with costs, an appeal made by the appellant against an arbitral award made by an arbitrator on 18 July 2017.FACTUAL BACKGROUNDThe appellant is a holding company with subsidiaries which include Ballantyne ...

FACTUAL BACKGROUND

The appellant is a holding company with subsidiaries which include Ballantyne Butchery (Private) Limited t/a Dan Meats and Triple C (Private) Limited. From August 2007, it employed the respondent as the Finance Manager of Ballantyne Butchery (Private) Limited t/a Dan Meats.

About January 2009, the appellant re-assigned the respondent to another subsidiary, Colcom Trading (Private) Limited, as Finance Manager, on the same employment conditions. He was again moved to Colcom Services (Private) Limited on the same conditions in 2011.

The fortunes of the appellant took a down turn about March 2013. As a result, a restructuring exercise was undertaken the effect of which was to include the respondent in a list of those who were to be retrenched from employment. Thereafter, the parties haggled for some time about the terms of retrenchment. During the course of that exercise, an opening occurred when the Finance Manager of Triple C (Private) Limited, another subsidiary of the appellant, immediately resigned leaving the post vacant.

The appellant seized the opportunity, and, by letter dated 11 March 2013, it offered the post to the respondent. As the position was the same grade as that held by the respondent, the transfer to Triple C (Private) Limited was said to be a lateral one. The offer letter written to the respondent made it clear that the appellant would gladly “clarify any clause in the contract” which the respondent felt needed clarification.

The employment letter containing the terms and conditions of employment was attached and a request was made for the respondent to signify his acceptance by signing an acceptance slip at the end of the letter. The respondent had misgivings about the terms contained in the letter and endorsed his reservations of what he termed “varied terms and conditions” in long hand at the bottom of each page of the appointment letter. Notwithstanding his reservations, the respondent signed the “acceptance of new contract” slip on 23 May 2013. He however indicated that he would continue reporting at his old station “under protest.”

The respondent was advised to report for duty at Triple C (Private) Limited on 27 March 2013.

He did not do so insisting on remaining at his former station from where he had been transferred. In fact, he lodged a complaint of an unfair labour practice with a Labour Officer. By letter dated 27 May 2013, the group Human Capital Director of the appellant put the respondent on terms to report for duty at his new employment station. The letter reads in relevant part:

“RE: YOUR FAILURE TO REPORT FOR DUTY AT TRIPLE C

It has come to our notice that you have not reported for duty at Triple C as per the letter of transfer which you signed for in acknowledgment of receipt on 23rd May 2013 and indicated therein that you were to report for duty as required of you but under 'protest.'

Your 'protest' arises from what you term 'variation of terms and conditions' of your employment.

While we were in the process of attending to the 'issues' you raised as alleged variations of terms and conditions of employment, we note, with regret, that you have already lodged a claim of unfair labour practices with the office of a Labour Officer on the same issues. In the circumstances, our due consideration of your 'concerns' has been rendered irrelevant by you.

However, in the meantime, please note that we expect you to report at Triple C and exercise your duties as Finance Manager than to sit idle in your office as you are doing. Should you fail to do so by 0800 hours on 29th May 2013, your conduct will be a repudiation of your employment to which we will accept your wishes and pay you your terminal benefits.

Please therefore be guided accordingly.

Kind regards
Z.Matsika
Group Human Capital Director.”

The respondent again defied the order to report for duty at Triple C (Private) Limited. The appellant then served the respondent with a notice of termination of the employment contract on 30 May 2013. He was advised that his terminal benefits, together with three months' notice pay, would be processed and paid into his Bank account.

The respondent was unhappy with that turn of events. He had already reported a case of unfair labour practice by the appellant alleging material variation of his contract, repudiation of the employment contract, and non-payment of benefits and arrears. In due course, the Labour Officer issued a Certificate of No Settlement. Resultantly, the dispute was referred to arbitration.

The arbitrator found in favour of the respondent. In the arbitral award, issued on 18 July 2017, the arbitrator found that the appellant was the respondent's employer.

He found that the employment contract had been unlawfully terminated and that there had been a unilateral variation of its terms. Reinstatement, or damages in lieu of it were ordered in the event that reinstatement was no longer possible. The arbitrator also ordered the appellant to pay damages for contractual breaches in the sum of US$29,686=39 for profit share and reimbursement of US$1,200 in school fees.

The appellant was aggrieved and took to the Labour Court on appeal.

The appellant contended that the respondent's failure to report for duty, as directed, amounted to a repudiation of the contract of employment and that there was no unilateral variation of the contract on its part.

It was the court a quo's finding that the appellant unlawfully terminated the employment contract which it had unilaterally varied. The fact that no disciplinary hearing was conducted violated the respondent's right to be heard. The appeal was dismissed.

It is against that judgment of the court a quo that this appeal was lodged.

GROUNDS OF APPEAL

The appellant raised the following grounds of appeal;

1. The court a quo (erred) in not finding that the respondent had sued the wrong party as his employer, and, accordingly, that the arbitrator had, in not finding that Triple C (Private) Limited was the respondent's employer, committed an error in law.

2. The court a quo erred in coming to the conclusion that there had been an unlawful variation of the terms of the respondent's contract of employment and so erred in not considering the circumstances under which he had been transferred and also the fact that an employment relationship cannot remain static.

3. The court a quo erred in not coming to the conclusion that the respondent had, by not reporting for duty after his transfer, repudiated his employment and that the acceptance of such repudiation by the employer did not constitute unfair dismissal.

4. A fortiori the court a quo erred in coming to the conclusion that the appellant ought to have brought disciplinary proceedings against the respondent.

At the commencement of the hearing of the appeal, counsel for the appellant abandoned the first ground of appeal. He indicated that he would motivate the appeal on the basis of the remaining three grounds. Accordingly, the first ground is struck out and will not be related to in this judgment.

ISSUE FOR DETERMINATION

While there are still three grounds of appeal, they all dovetail to only one issue for determination in this appeal. It is whether or not the respondent's contract of employment was lawfully terminated.

SUBMISSIONS ON APPEAL

Counsel for the appellant submitted that the respondent's employment was lawfully terminated on notice after he refused to assume duty at Triple C (Private) Limited. He submitted that there is a distinction between a dismissal from employment which follows disciplinary proceedings and a termination of employment on notice. Both, the court a quo and the arbitrator, so the argument goes, fell into grave error in making a finding that the appellant was required to institute disciplinary proceedings against the respondent before terminating his employment.

It was further argued, on behalf of the appellant, that the offer to employ the respondent at Triple C (Private) Limited came in the context of retrenchment proceedings which were ongoing at the time.

Indeed, according to the minutes of a meeting held by the parties on 25 March 2013 to negotiate a retrenchment package, it is the respondent himself who made a proposal “to be given right of first refusal of new jobs if they arise.” The respondent had made the request because, according to him, “there (were) no jobs out there.” When the Finance Manager of Triple C (Private) Limited resigned, an opportunity presented itself to avoid retrenching the respondent by offering him the job as requested.

According to the appellant, the respondent accepted the offer of the job, albeit under protest. His concerns were still being looked into but he was expected to report for duty. He refused to do so preferring to remain idle. Counsel for the appellant submitted that the stance taken by the respondent left the appellant in a quandary because it had nowhere else to deploy him. It was the intransigence of the respondent, in continuing to report at his former station where there was no work to be performed, which invited the termination of his contract of employment on notice. Counsel for the appellant maintained that the appellant was entitled, at law, to terminate the employment on notice. He placed reliance on a number of authorities to make that submission.

Counsel for the respondent took the view that there are two issues that are dispositive of the appeal;

(a) The first one is whether or not the appellant unilaterally varied the employment contract.

In that regard he made reference to the letter of transfer dated 21 May 2013 which made it clear that the transfer was a lateral one. This meant that the respondent would continue to enjoy the same benefits he enjoyed prior to being transferred.

The view taken by the respondent is that the appellant tinkered with the conditions of his employment thereby repudiating it.

(b) The second one is whether the subsequent termination was lawful.

In that regard, the court a quo correctly found that the employment contract was unlawfully or unfairly terminated. In fact, the court a quo was of the view that a disciplinary hearing should have been conducted in terms of the appellant's Code of Conduct. In arriving at that position the court a quo relied on section 12B(1) of the Labour Act [Chapter 28:01] which provides that an employee is unfairly dismissed if the employer fails to show that he, she, or it dismissed the employee in terms of an employment Code.

ANALYSIS

It is common cause that no disciplinary proceedings were instituted against the respondent and that he was not charged with any act of misconduct for which he could be dismissed from employment. It is also common cause that when the parties reached a deadlock about the respondent assuming duty at a new base, to which he had been transferred, the appellant served him with a notice of termination of employment.

The issue for determination is the lawfulness of that course of action.

In considering the lawfulness of the appellant's actions, it is important to start from the standpoint that upon the respondent being transferred to Triple C (Private) Limited, he signed the letter of appointment on the space provided for “acceptance of new contract.” He then registered his concerns with the appellant as he was entitled to do. The respondent also went on to report a dispute to a Labour Officer. This was also proper and the dispute would have been dealt with according to the law.

His biggest undoing was the dogged refusal to report for duty assigned to him. It meant that the parties could not contractually move forward together.

The appellant did not opt to charge the respondent with misconduct and certainly did not dismiss him for misconduct.

I agree with counsel for the appellant that termination of employment does not amount to dismissal all the time and that while dismissal results in termination of employment there may be termination without dismissal.

Dismissal ordinarily arises from disciplinary proceedings while termination may be done on notice.

Indeed, section 12 of the Labour Act [Chapter 28:01] deals with “Duration, particulars and termination of employment contract” while, on the other hand, section 12B is on “Dismissal.” That, on its own means a lot. The two sections provide for two different methods of bringing an employment contract to an end. The first method is through termination while the second is through dismissal.

It is now settled in our jurisdiction that, despite the provisions of section 12B of the Labour Act [Chapter 28:01] dealing with dismissal of an employee from employment in terms of an employment Code of Conduct, an employer retains the right to terminate employment on notice as provided for under the common law. Section 12B of the Labour Act does not concern itself with the general termination of employment by means other than in terms of a Code of Conduct be it an employer's Code of Conduct or the national Code of Conduct.

It is section 12(4) of the Labour Act [Chapter 28:01] which deals with the concept of termination of employment on notice.

It regulates the period of notice to be given for such termination. In Chirasasa v Nhamo N.O. and Anor 2003 (2) ZLR 206 (S), the court upheld the termination of employment where the parties had failed to agree on new conditions of employment. It was stated:

“In this case, the appellants agreed that there was no act of misconduct alleged against them. The parties had failed to agree on the new terms and conditions of employment proposed by the second respondent to meet the operational requirements of its business. The second respondent had a right to terminate the contracts of employment with the appellants by giving them one calender months' notice and could exercise it without obtaining prior written approval of the Minister.”

The above reasoning was followed by this Court in Colcom Foods Limited v Kabasa SC12-04 where the following passage appears:

“In this case, it was conceded that there was no allegation of misconduct levelled against Kabasa. He was not being retrenched. It was his refusal to accept that his status was that of Human Resources Manager that caused the decision to terminate his employment with Colcom on notice. On the authority of Chirasasa's case supra, Colcom was entitled to terminate Kabasa's employment on notice.”

The court went on to state, in that case, that, as it was not an act of misconduct for the employee to refuse to accept the change in his conditions of service, the employer was not bound to terminate his employment in terms of the disciplinary procedure laid down in the employment Code of Conduct.

On the basis of that authority, it is clear that the court a quo was wrong in drawing the conclusion that the appellant should have conducted a disciplinary hearing following the respondent's refusal to report for duty. There was no need to proceed in terms of a Code of Conduct.

Quite recently, in the case of Nyamande and Anor v Zuva Petroleum (Private) Limited 2015 (2) ZLR 186 (S), this Court reiterated the correctness of the assertion that an employer has the right to terminate employment on notice. CHIDYAUSIKU CJ endorsed it in these words…,-

“The respondent appealed to the Labour Court. The Labour Court allowed the appeal. In its judgment, the Labour Court had this to say:

'In my view, therefore, the submission that section 12B came to do away with the possibility of terminating a contract of employment on notice is a misunderstanding of the law as it stands. In an event, the provisions of section 12(4) of the Act are clear and allow no ambiguity as also the provisions of section 12B. None of the sections have the effect of doing away with the termination of a contract of employment on notice.'

In essence, the Labour Court came to the conclusion that neither section 12B nor section 12(4) of the Act abolished the employer's right to terminate employment on notice. I respectfully agree with this conclusion.”

The learned Chief Justice went on, at p190 A-B, to make the following pronouncement:

“As I have already stated, it is common cause that once upon a time both the employer and the employee had a common law right to terminate an employment relationship on notice. That common law right, in respect of both the employer and the employee, can only be limited, abolished, or regulated by an Act of Parliament or a statutory instrument that is clearly intra vires an Act of Parliament. I am satisfied that section 12B of the Act does not abolish the employer's common law right to terminate employment on notice in terms of an employment contract for a number of reasons.”

Having come to the conclusion that the appellant was entitled to terminate the employment without invoking the employment Code of Conduct, by giving the respondent notice of termination, it becomes superfluous to relate to the issue of the alleged variation of the terms and conditions of employment.

The authorities I have cited make it clear that a deadlock in negotiations over new terms of employment may entitle the employer to terminate on notice. See Colcom Foods Limited v Kabasa SC12-04.

I have said that the respondent shot himself in the foot by refusing to comply with transfer instructions - especially after he had accepted a new contract by signing it. If he was aggrieved by what he regarded as a unilateral alteration of his contract, he should have pursued his grievance while reporting for duty. By his intransigence he opened himself up for termination on notice.

On the other hand, the appellant had a lawful right to abandon discussions with the respondent and opt for termination on notice. There was no requirement for a disciplinary hearing because it was not an act of misconduct for the respondent to refuse to take up the new employment.

The judgment of the court a quo is wrong. It ignores all the rich authorities on the subject of termination on notice. It ought to be vacated.

Regarding the issue of costs, I see no reason why the costs should not follow the result.

In the result, it is ordered that:

1. The appeal succeeds with costs.

2. The judgment of the court a quo be and is hereby set aside and in its place be substituted the following:

“The appeal is hereby allowed and the arbitral award set aside with costs.”

HH39-11 : BLUMO TRADING (PVT) LTD vs NELMAH MILLING COMPANY (PVT) LTD and NELSON MAHUPETE
Ruled By: PATEL J

The plaintiff in this matter claims the sum of US$24,100 as special damages, being loss of profits arising from an alleged breach of contract by the defendants.It also claims restitution of US$10,000 paid as a deposit to the first defendant under the same contract.The defendants deny any breach on their ...

The plaintiff in this matter claims the sum of US$24,100 as special damages, being loss of profits arising from an alleged breach of contract by the defendants.

It also claims restitution of US$10,000 paid as a deposit to the first defendant under the same contract.

The defendants deny any breach on their part and allege that it was in fact the plaintiff that acted in breach of contract.

Evidence for the Plaintiff

Wayne Victor Moss is the Chief Executive Officer of the plaintiff company which, together with CCC Pigs (Pvt) Ltd, is a subsidiary of Colcom Foods Limited. He testified as follows:

On the 18th of January 2010, he signed the Agreement in casu with the defendants. In essence, the Agreement was for the sale of 500 tons of maize (at US$235 per ton) for a total purchase price of US$117,500. The maize was to be sourced by the first defendant from the Grain Marketing Board (the GMB).

On the same date, the second defendant signed a contract of suretyship guaranteeing the delivery of maize in terms of the Agreement. He said that the first defendant had a credit facility with the Grain Marketing Board (GMB) for 2,000 tons.

On the 21st of January, he withdrew a total of US$100,000 from the bank. He paid the agreed deposit of US$10,000 to the second defendant and then proceeded with him to the Grain Marketing Board (GMB) with US$90,000 in cash.

The Grain Marketing Board (GMB) was not aware of the transaction and had no release orders in the name of the first defendant. He was told by the GMB's Credit Controller (Mawanza) that he could obtain only 300 tons of maize at a higher price of US$300 per ton if he paid the US$90,000 into the first defendant's account with the GMB. This was because the first defendant's facility was for a maximum of 300 tons and because its account with the GMB was in debit at that time.

The second defendant then undertook to resolve the matter the following day.

The witness subsequently visited the Grain Marketing Board (GMB) on four consecutive days and was given the same explanations by Mawanza. He then met the GMB Marketing Manager (Mandizvidza) who cautioned him against dealing with the first defendant. Mandizvidza later furnished a letter confirming the first defendant's credit standing with the GMB at the relevant time.

The plaintiff did not proceed with the transaction as it became evident that the first defendant did not have the capacity to deliver as agreed.

The Agreement was cancelled on the 2nd of February and this was confirmed by the plaintiff's lawyers in their letter of the 4th of March to the first defendant. The defendants offered to restitute the US$10,000 deposit in January and October 2010, but have not made any payment to date.

The plaintiff had a contract with CCC Pigs (Pvt) Ltd, signed immediately after the Agreement with the defendants, for the onward supply of 500 tons of maize at a price of US$290 per ton. This represented a profit margin of US$55 per ton equating to a total profit of US$22,500. The plaintiff had arranged for the transportation of the maize at a cost of US$200 per truck. In order to meet its contract with CCC Pigs the plaintiff had to order 508 tons of maize from South Africa at a price of US$317 per ton.

Under cross-examination, the witness conceded that the deposit of US$10,000 was not paid on signature of the Agreement but on the 21st of January and that the sum of US$90,000 was not deposited into the GMB's bank account as agreed. The payments were a few days late and not strictly in accordance with the terms of the Agreement. However, this was not unreasonable in the circumstances of the transaction and the second defendant had accepted the delays. Moreover, the witness did not have the Grain Marketing Board's (GMB) bank account details.

Odson Dzanga is the plaintiff's Financial Manager. He accompanied Wayne Victor Moss to the Grain Marketing Board (GMB) on the 22nd of January 2010. He confirmed that the GMB would only have released 300 tons of maize upon payment of the US$90,000 in cash. He added that the first defendant's account with the GMB was in arrears standing at about US$54,000 as at the 8th of January 2010.

Emson Mandizvidza has been employed by the Grain Marketing Board (GMB) as its Marketing Manager since 2003. His duties include checking the credit facilities of customers, and, in conjunction with the Credit Controller, authorising release orders on credit sales. He corroborated the testimony of Wayne Victor Moss and Odson Dzanga regarding their visit to the GMB on the 22nd of January and his discussion with Moss in the presence of the second defendant. He also confirmed the contents of his letter of the 13th of May 2010 concerning GMB prices and the first defendant's credit status.

Between the 18th and 22nd of January 2010, the first defendant's credit facility was on hold because of its outstanding arrears of US$54,000, and, in any event, that facility did not enable it to buy 500 tons of maize from the Grain Marketing Board (GMB). At that time, the first defendant's credit facility was limited to 300 tons per month.

In practice, a credit customer wishing to increase its credit limit would have to apply, in writing, and the application would then be assessed by the Risk Management Committee (the RMC) which meets once a week.

In December 2009, the first defendant applied to increase its credit limit to 2,000 tons per month. This application was turned down by the Risk Management Committee (RMC) before the 18th of January. As at that date, there was no application from the first defendant to increase its credit limit. Even if it had lodged an application, this would only have been processed the following week and it would not have been possible to approve any increase on the 22nd of January. The Grain Marketing Board (GMB) sued the first defendant for the outstanding US$54,000 in April 2010 in Case No. HC2191/10. At the present time, the first defendant is no longer a credit client of the Grain Marketing Board (GMB).

Wanda van den Bergh is a grain broker. Her evidence was that she introduced Wayne Victor Moss to the second defendant in January 2010. The agreement between them was for the first defendant to supply maize to the plaintiff for onward sale to CCC Pigs (Pvt) Ltd. She was not aware of the first defendant's credit facility with the Grain Marketing Board (GMB).

Evidence for the Defendants

Nelson Mahupete, the second defendant, is the Chairman and Managing Director of the first defendant.

His evidence was that in December 2009 he applied to the Grain Marketing Board's (GMB) credit controllers (Mawanza and Pfumbidza) to increase the first defendant's credit facility from 300 tons to 2,000 tons per month. They agreed to increase the facility to 1,500 tons - provided the outstanding debt of US$54,000 due to the GMB was cleared.

After the Agreement was concluded with the plaintiff, Wayne Victor Moss only paid the deposit of US$10,000 after three (3) days. Moreover, he did not effect transfer of the US$90,000 into the Grain Marketing Board's (GMB) account but arrived at the GMB offices with the cash equivalent. He then declined to pay that amount towards the first defendant's account with the GMB. If he had done so, the first defendant would have fulfilled the contract to deliver 500 tons of maize.

As regards the debt of US$54,000 owed to the Grain Marketing Board (GMB), the first defendant has already paid US$33,250 towards this and the balance is to be cleared as per an agreed payment plan.

Under cross-examination, the second defendant conceded that the 500 tons of maize in question was for pig feed but denied that it was intended for CCC Pigs (Pvt) Ltd.

He disputed the averment to that effect made by Mandizvidza in his statement to the CID Serious Fraud Squad on the 12th of February 2010.

As regards the release orders for 500 tons of maize, he admitted that he did not have them in his possession on signature of the Agreement on the 18th of January or at the Grain Marketing Board (GMB) offices on the 21st of January.

He has been charged with fraud in respect of the present contract. The criminal trial has commenced and is yet to be completed.

Vavavirayi Mawanza has been the Grain Marketing Board's (GMB) Credit Controller since January 1999.

His evidence was that Grain Marketing Board (GMB) release orders are first signed by him and then by the Marketing Manager before they are issued. In August 2009, the first defendant applied for a credit facility, and, in September, it was granted a facility for 150 tons per fortnight or 300 tons per month. In December 2009, the GMB released a total of 268 tons of maize to the first defendant. The latter then applied for a facility of 2,000 tons per month. On the 18th or 19th of December, he verbally advised the second defendant that he could only approve a facility of 1,500 tons on condition that the first defendant paid an additional US$200,000 towards its account with the GMB.

As at the 8th of January 2010, the first defendant's account was in debit of about US$54,000. On the 22nd of January 2010, Wayne Victor Moss came to the Grain Marketing Board (GMB) wanting to pay US$90,000 into the first defendant's account. The witness refused his request and said that the first defendant should make the payment itself. Moreover, it would not have been possible for Moss to have paid the GMB through its own bank account.

In his statement to the CID Serious Fraud Squad, dated the 15th of February 2010, he declared that “the accused (second defendant) has a buying limit of 150 tonnes at a time.”

There was no mention of an increased limit of 1,500 tons having been conditionally approved.

Tatenda Pfumbidza is an Assistant Credit Controller with the Grain Marketing Board (GMB).

He confirmed that an existing credit client must apply, in writing, for any increase in its credit facility and that, if its application is approved, the Marketing Department and the client must be advised of the increased limit in writing.

When the first defendant applied for an increased limit of 2,000 tons, in December 2000, it was told to make an additional payment of “more than US$100,000” towards its account with the Grain Marketing Board (GMB). This application was not approved because the additional payment was not made.

In February 2010, the second defendant approached him for a credit reference. He then wrote two reference letters dated the 5th and 8th of February. He conceded that the letters were silent as to the conditions of release and the tonnage that could be released to the first defendant. Moreover, he accepted that the letters were not addressed to the plaintiff or to Wayne Victor Moss and that they were written after the events giving rise to the plaintiff's action in casu.

Breach of Agreement by Plaintiff

It is a fundamental premise of every contract that both parties will duly carry out their respective obligations. See Green v Lutz 1966 RLR 633; ESE Financial Services (Pty) Ltd v Cramer 1975 (2) SA 805 (C)…,.

As is explained by CHRISTIE: Business Law in Zimbabwe…,.:

“There is a presumption that in every bilateral or synallagmatic contract, i.e. one in which each party undertakes obligations towards the other, the common intention is that neither should be entitled to enforce the contract unless he has performed or is ready to perform his own obligations….,.

…,. Conversely, a party who has caused the other to commit a breach cannot found a claim on the breach…,.”

In terms of clause 3 of the Agreement in this case, the plaintiff undertook to pay a deposit of US$100,000 “upon the signing of this agreement”, US$90,000 into the bank account of the Grain Marketing Board (GMB) and US$10,000 in cash to the defendants.

It is common cause that Wayne Victor Moss did not pay the deposit of US$10,000 and did not transfer the sum of US$90,000 into the Grain Marketing Board's (GMB) bank account upon signature of the Agreement. Instead, he paid the US$10,000 deposit only on the 21st of January, and, on the same date, tendered US$90,000 in cash to the GMB.

It is therefore clear that the plaintiff did not perform its obligations strictly in accordance with clause 3 of the Agreement.

However, it is equally clear that the defendants accepted the late payment of the US$10,000, and, furthermore, they actively attempted to pressurise Wayne Victor Moss to pay the US$90,000 in cash to the Grain Marketing Board (GMB), particularly as it was not practically possible for him to make that payment into the GMB's bank account.

At that stage, he was obviously willing and able to make both payments in performance of the plaintiff's obligations.

Given the attitude and conduct of the parties, the delay of three (3) days in tendering the payments and the departure in the mode of payment to the Grain Marketing Board (GMB) were not material to the plaintiff's undertakings under the Agreement; and, although the plaintiff did not strictly comply with its payment obligations, such non-compliance was accepted by the defendants.

In short, they positively acquiesced in that non-compliance and are therefore estopped from raising it as a defence to the plaintiff's claim.

Breach of Agreement by Defendants

Turning to the defendants' undertakings, these were spelt out in clauses 4 to 7 of the Agreement.

(a) Firstly, once the plaintiff had paid the deposit, the first defendant was obliged, under clause 4, to cede its release orders for 500 tons of maize “which it has already received or will shortly receive from GMB.”

(b) Secondly, after paying the deposit, the plaintiff was authorised, by clause 5, “to immediately upload the maize from GMB.”

(c) Thirdly, by virtue of clause 6.1, the first defendant warranted that “it does currently, or it will, by Tuesday 19 January 2010, have a release order or release orders in its name from GMB for 500 tons of maize.”

(d) Finally, clause 7.1 entitled the plaintiff to cancel the contract “should the seller not have a release offer [sic] or release offers [sic] in its name by Friday 22 January 2010.”

It is submitted, for the defendants, that the undertakings stipulated in the Agreement are dubious in their meaning. Consequently, in as much as the Agreement was drafted by the plaintiff's lawyers, its provisions must be construed strictly as against the plaintiff on the one hand and leniently as against the defendants on the other.

While this may be the general purport of the so-called contra proferentem or contra stipulatorem rule of interpretation, it is trite that this rule may only be invoked where the provision to be applied is ambiguous in its meaning or effect. See CHRISTIE: Business Law in Zimbabwe…,.

In the instant case, I do not perceive any such ambiguity in the terms of the Agreement. In my view, the combined effect of clauses 4 to 7 of the Agreement was this:

The defendants warranted that they either had the requisite release orders or would have them in their possession by the 19th of January; they undertook to cede the release orders to the plaintiff upon payment of the stipulated deposit; the plaintiff would then take delivery of 500 tons of maize; and, in the event that the defendants did not have the release orders by the 22nd of January, at the latest, the plaintiff was entitled to cancel the Agreement.

The test for determining the repudiation of a contract by way of anticipatory breach was expounded by NIENEBAR JA in Datacolor International (Pty) Ltd v Intamarket (Pty) Ltd 2001 (1) SA 581 (A)…, as follows:

“…, the emphasis is not on the repudiating party's state of mind, on what he subjectively intended, but on what someone in the position of the innocent party would think he intended to do; repudiation is, accordingly, not a matter of intention, it is a matter of perception.

The perception is that of a reasonable person placed in the position of the aggrieved party. The test is whether such a notional reasonable person would conclude that proper performance (in accordance with a true interpretation of the agreement) will not be forthcoming. The inferred intention accordingly serves as the criterion for determining the nature of the threatened actual breach.

…, due to the co-contractant's repudiation, the innocent contractant is excused from any steps that he must take in preparation for his own performance…,. In these circumstances, the purchaser will not fall into mora by failing to tender performance…, as long as he signifies his willingness to perform.”

Similarly, LORD WRIGHT, cited with approval in Chinyerere v Fraser N.O. 1994 (2) ZLR 234 (H)…, observed as follows in Ross T. Smyth & Co. Ltd v T.D. Bailey, Son & Co. [1940] 3 All ER 60 (HL)…,.:

“I do not say that it is necessary to show that the party alleged to have repudiated should have an actual intention not to fulfil the contract. He may intend in fact to fulfil it, but, may be determined to do so only in a manner substantially inconsistent with his obligations, and in no other way.”

The evidence before the Court shows that the first defendant did not have the requisite release orders from the Grain Marketing Board (GMB), either by the 19th or the 22nd of January, nor did it hold a credit facility with the GMB for 500 tons of maize at that time. Conversely, on the 21st of January, the plaintiff had paid the cash deposit of US$10,000 to the defendants and was prepared to pay the remaining deposit of $90,000 in cash to the GMB.

It follows that the defendants were patently in breach of the warranty contained in clause 6.1, and, because of their evident inability to fulfil the contract timeously, they were in anticipatory breach of their obligations under clauses 4 and 5 to cede the release orders and deliver 500 tons of maize. Consequently, the plaintiff was entitled to withhold any further payment under the Agreement.

Cancellation of Agreement

At common law, an anticipatory breach ordinarily entitles the innocent contractant to cancel the contract. As is observed by KERR: The Principles of Contract Law (6th ed.)…,.:

“…, repudiation before the due date for performance by a party prospectively in default constitutes anticipatory breach of contract on which the aggrieved party may take action if he so elects.”

In the instant case, clause 7.1 of the Agreement expressly allowed the plaintiff to cancel the contract in the event of the first defendant's failure to have the requisite release orders in its name by the 22nd of January 2010.

Thus, as at that date, the plaintiff was entitled to cancel on two separate grounds, viz;

(i) The defendants' actual breach of warranty as well as;

(ii) Their anticipated failure to cede the release orders and deliver the stipulated tonnage of maize in breach of clauses 4 and 5 of the Agreement.

In the event, the plaintiff lawfully cancelled the Agreement on the 2nd of February 2010, as was confirmed by its lawyers in their letter of the 4th of March 2010 to the defendants....,.

Claim for Special Damages

Clause 7 of the Agreement stipulates the plaintiff's remedies in the event of cancellation.

Both counsel for the plaintiff and counsel for the defendants have opted not to proffer any enlightenment on what was intended by the parties, presumably because that intention is not easily discernible from the vague and seemingly contradictory elections set out in this clause.

It then becomes necessary to consider the plaintiff's rights and remedies at common law.

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Law Portal Zimbabwe

Termination of Contracts and Notice of Cancellation re: Approach, Repudiation, Debtors Mora and Effect of Breach of Contract

HH14-09 : TENDAI MUZA vs CHRISTINA MUWIRIMI and FATIMA MURWISI and MUNICIPALITY OF CHITUNGWIZA Ruled By: MTSHIYA J

HH71-09 : AGRO CHEM DEALERS (PVT) LTD vs STANLEY GOMO and CITY OF HARARE and RONALD AJARA and THE REGISTRAR OF DEEDS Ruled By: GOWORA J

HH41-08 : ZODELLA ENTERPRISES (PVT) LIMITED vs LUXMORE NDENDA Ruled By: GOWORA J

SC21-09 : ZIMBABWE EXPRESS SERVICES (PRIVATE) LIMITED vs NUANETSI RANCH (PRIVATE) LIMITED Ruled By: ZIYAMBI JA, GWAUNZA JA and GARWE JA

HH165-12 : MINING INDUSTYRY PENSION FUND vs FARTINGALE DESIGN (PVT) LTD AND LETINA UNDENGE Ruled By: KUDYA J

HB12-12 : KENNEDY GWAMURE vs DINGANI TSHUMA Ruled By: NDOU J

HB12-12 : KENNEDY GWAMURE vs DINGANI TSHUMA Ruled By: NDOU J

HB12-12 : KENNEDY GWAMURE vs DINGANI TSHUMA Ruled By: NDOU J

HH03-09 : RACHEL MEYERS-MBIDZO N.O vs JOHN MARK CHIPUNZA AND REGISTRAR OF DEEDS Ruled By: MTSHIYA J

HH03-09 : RACHEL MEYERS-MBIDZO N.O vs JOHN MARK CHIPUNZA AND REGISTRAR OF DEEDS Ruled By: MTSHIYA J

HH40-08 : DHLIWAYO RODGERS vs SHAUN MANDAA KUDINGA Ruled By: MTSHIYA J

SC17-09 : ELIZABETH MUTIZHE vs LOVENESS GANDA and THE REGISTRAR OF DEEDS and FANNIE MUTIZHE Ruled By: MALABA DCJ

HH93-09 : HAVEN CHIKUMBU vs BRYDEN TECHINICAL SERVICES (PRIVATE) LIMITED AND THE REGISTRAR OF DEEDS AND THE DEPUTY SHERIFF FOR HARARE Ruled By: CHITAKUNYE J

HH144-09 : NEGOWAC SERVICES (PRIVATE) LIMITED vs 3D HOLDINGS (PRIVATE) LIMITED AND GIFTCARE ELECTRICAL (PVT) LTD t/a REG ELECTRICAL WHOLESALERS Ruled By: MTSHIYA J

HH145-09 : TAKAVADA MAPFUMO vs PREMIER SERVICE MEDICAL INVESTMENTS (PVT) LTD AND DEPUTY SHERIFF AND RANGANAYI CHARLES MUBVUMBI Ruled By: UCHENA J

HH154-09 : PETHIAS CHITSUNGO vs D. MASUKU and RUWA LOCAL BOARD Ruled By: MTSHIYA J

HB37-09 : MARGRET CAROL COLER vs MAXWEL SHUMBA Ruled By: KAMOCHA J

HB46-09 : HERBERT SIKHOSANA vs ESTATE LATE A MTSANA and SHOWLAST NCUBE and NAPFUTALI SIBANDA and ZANELE NCUBE and NOKUTHULA MTHETHWA and ORS Ruled By: NDOU J

HB94-09 : NOMALANGA SIBANDA vs GIVEN NYATHI and SEHLISO NYATHI and THE REGISTRAR OF DEEDS, BULAWAYO and BEN BARON AND PARTNERS Ruled By: KAMOCHA J

HH11-10 : NABANE ROY TSHUMA vs TONGAI MUSEMBURI and TENDAI MUSEMBURI and MACKSON TOTSHANE NCUBE and THE REGISTRAR OF DEEDS Ruled By: KARWI J

HH25-10 : MAXWELL MATSVIMBO SIBANDA vs GWYNNE ANNE STEVENSON Ruled By: CHITAKUNYE J

HH67-10 : JAMES MUTETWA vs BARRIE DIXON and MARKO MAVHURUNE N.O. (as Executor Estate Late Samuel Mushaninga) and KENIAS MUTYASIRA N.O. (as Executor Estate Late Salome Chisvo) and REGISTRAR OF DEEDS Ruled By: MAKARAU JP

HH107-10 : CHIROSWA MINERALS (PRIVATE) LIMITED and BASE MINERALS (PRIVATE) LIMITED vs MINISTER OF MINES and MORIS TENDAI NYAKUDYA and VAMBO MILLS (PRIVATE) LIMITED Ruled By: BHUNU J

View Appeal SC36-13 : DINESH MANIAL NARAN vs RONNAH MAFURIRANO and THE REGISTRAR OF DEEDS Ruled By: CHIDYAUSIKU CJ, ZIYAMBI JA and MAKONESE AJA

HH160-10 : TONDERAI HAMANDISHE and GAMUCHIRAI SANGARE vs MAFFACK PROPERTIES (PVT) LTD Ruled By: MTSHIYA J

HH161-10 : NEVER BVOCHORA vs DOUGLAS TOGARASEI MWONZORA (In his capacity as The executor Dative of the Estate Late I.V. Rukatya) Ruled By: HUNGWE J

HB12-10 : BETTY GASELA vs LEONARD MALINGA and BULAWAYO CITY COUNCIL and THE REGISTRAR OF DEEDS Ruled By: KAMOCHA J

HB63-10 : SALLY MAPLANKA vs B. A. NCUBE HOLDINGS Ruled By: NDOU J

HH11-13 : FLORENCE SIGUDU vs MINISTER OF LANDS AND RURAL RESETTLEMENT N.O. and PHINEAS CHIHOTA Ruled By: PATEL J

HH147-11 : FANUEL MWAYERA vs MOLLY CHIVIZHE and STANLEY CHIVIZHE and THE REGISTRAR OF DEEDS and GILBERT JONGA Ruled By: CHITAKUNYE J

Appealed HH158-11 : TRUSTCO MOBILE (PTY) LIMITED and TRUSTCO GROUP INTERNATIONAL (PTY) LIMITED vs ECONET WIRELESS (PRIVATE) LIMITED and FIRST MUTUAL LIFE ASSURANCE COMPANY (PRIVATE) LIMITED Ruled By: MUTEMA J

HB65-13 : ANATOTH MINING (PVT) LTD vs BRIGHTON NYAMUCHO and GARLOREM RESOURCES (PVT) LTD t/a KIMS INVESTMENTS Ruled By: KAMOCHA J

HB158-13 : KERRIES ENGINEERING (PVT) LTD vs MAKOMO RESOURCES (PVT) LTD Ruled By: MAKONESE J

HH338-14 : MAFIRAMBUDZI FAMILY TRUST vs LIBERTY MADZINGIRA and PANNAH NHIWATIWA and THE REGISTRAR OF DEEDS N.O. and THE SHERIFF Ruled By: TAKUVA J

View Appeal SC43-13 : ECONET WIRELESS (PVT) LTD vs TRUSTCO MOBILE (PROPRIETARY) LTD and TRUSTCO GROUP INTERNATIONAL (PROPRIETARY) LTD Ruled By: MALABA DCJ, ZIYAMBI JA and GARWE JA

HH535-15 : BLESSMORE CHANAKIRA vs SHEPHERD MALCOM N.O. and REGISTRAR OF DEEDS and PHIL RUSCH Ruled By: NDEWERE J

HH128-06 : DOBROCK HOLDINGS (PVT) LTD and TURNER AND SONS (PVT) LTD vs TURNER AND SONS (PVT) LTD and ANTHONY TURNER and MARTIN KING and ZAMBEZI PADDLE STEAMER (PVT) LTD and DOBROCK (PVT) LTD Ruled By: KUDYA J

HH797-15 : PETER KAZINGIZI and THERESA MUCHABAIWA KAZINGIZI vs EQUITY PROPERTIES (PVT) LTD Ruled By: MATHONSI J

HB149-16 : MUNATSI SHOKO vs OLD MUTUAL ZIMBABWE LIMITED Ruled By: MOYO J

HH114-15 : THEMPSON MUZVAGWANDOGA and DZOKAI MUZVAGWANDOGA vs MAI-KAI REAL ESTATE DEVELOPMENT TRUST and BERNARD MUTANGA and MOLLY DINGANI and THE REGISTRAR OF DEEDS Ruled By: MAFUSIRE J

HB157-16 : NRZ CONTRIBUTORY PENSION FUND vs JOSRO ENTERPRISES (PVT) LTD t/a ASCOT PUB & GRILL Ruled By: TAKUVA J

Appealed HH151-16 : SHORAI NZARA and ARROLA IDEHEN and AMOSOGE IDEHEN and OSARETIN IDEHEN and vs CECILIAH KASHUMBA N.O. and REGISTRAR OF DEEDS and MASTER OF THE HIGH COURT and TAFIRENYIKA KAMBARAMI Ruled By: MAFUSIRE J

HH63-13 : BLESSMORE Z. MABVURAMITI vs ALTFIN INSURANCE COMPANY Ruled By: MAFUSIRE J

Appealed HH86-13 : GOLDEN MILLION ENGINEERING (PVT) LTD vs METTALON GOLD ZIMBABWE (PVT) LTD Ruled By: KUDYA J

Appealed SC05-18 : JENNIFER BROOKER and ADRIENNE PIERCE vs RICHARD MUDHANDA and THE REGISTRAR OF DEEDS Ruled By: GOWORA JA, HLATSHWAYO JA and BHUNU JA

View Appeal HH637-15 : RICHARD MUDHANDA vs JENNIFER BROOKER and REGISTRAR OF DEEDS Ruled By: MUREMBA J

Appealed SC58-20 : YUSUF GAIBIE and MILLY GAIBIE N.O. vs ALEXANDER CASTANHEIRA and RACHEL CASTANHEIRA Ruled By: GARWE JA, BHUNU JA and MAKONI JA

View Appeal HB179-18 : YUSUF GAIBIE and MAHMOUD GAIBIE vs ALEXANDER CASTANHEIRA and RACHEL CASTANHEIRA Ruled By: MAKONESE J

SC107-20 : COLCOM FOODS LIMITED vs TARUVA TARUVA Ruled By: GWAUNZA DCJ, GUVAVA JA and MATHONSI JA

HH39-11 : BLUMO TRADING (PVT) LTD vs NELMAH MILLING COMPANY (PVT) LTD and NELSON MAHUPETE Ruled By: PATEL J

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Law Portal
Zimbabwe

HH14-09 : TENDAI MUZA vs CHRISTINA MUWIRIMI and FATIMA MURWISI and MUNICIPALITY OF CHITUNGWIZA
Ruled By: MTSHIYA J

HH71-09 : AGRO CHEM DEALERS (PVT) LTD vs STANLEY GOMO and CITY OF HARARE and RONALD AJARA and THE REGISTRAR OF DEEDS
Ruled By: GOWORA J

HH41-08 : ZODELLA ENTERPRISES (PVT) LIMITED vs LUXMORE NDENDA
Ruled By: GOWORA J

SC21-09 : ZIMBABWE EXPRESS SERVICES (PRIVATE) LIMITED vs NUANETSI RANCH (PRIVATE) LIMITED
Ruled By: ZIYAMBI JA, GWAUNZA JA and GARWE JA

HH165-12 : MINING INDUSTYRY PENSION FUND vs FARTINGALE DESIGN (PVT) LTD AND LETINA UNDENGE
Ruled By: KUDYA J

HB12-12 : KENNEDY GWAMURE vs DINGANI TSHUMA
Ruled By: NDOU J

HB12-12 : KENNEDY GWAMURE vs DINGANI TSHUMA
Ruled By: NDOU J

HB12-12 : KENNEDY GWAMURE vs DINGANI TSHUMA
Ruled By: NDOU J

HH03-09 : RACHEL MEYERS-MBIDZO N.O vs JOHN MARK CHIPUNZA AND REGISTRAR OF DEEDS
Ruled By: MTSHIYA J

HH03-09 : RACHEL MEYERS-MBIDZO N.O vs JOHN MARK CHIPUNZA AND REGISTRAR OF DEEDS
Ruled By: MTSHIYA J

HH40-08 : DHLIWAYO RODGERS vs SHAUN MANDAA KUDINGA
Ruled By: MTSHIYA J

SC17-09 : ELIZABETH MUTIZHE vs LOVENESS GANDA and THE REGISTRAR OF DEEDS and FANNIE MUTIZHE
Ruled By: MALABA DCJ

HH93-09 : HAVEN CHIKUMBU vs BRYDEN TECHINICAL SERVICES (PRIVATE) LIMITED AND THE REGISTRAR OF DEEDS AND THE DEPUTY SHERIFF FOR HARARE
Ruled By: CHITAKUNYE J

HH144-09 : NEGOWAC SERVICES (PRIVATE) LIMITED vs 3D HOLDINGS (PRIVATE) LIMITED AND GIFTCARE ELECTRICAL (PVT) LTD t/a REG ELECTRICAL WHOLESALERS
Ruled By: MTSHIYA J

HH145-09 : TAKAVADA MAPFUMO vs PREMIER SERVICE MEDICAL INVESTMENTS (PVT) LTD AND DEPUTY SHERIFF AND RANGANAYI CHARLES MUBVUMBI
Ruled By: UCHENA J

HH154-09 : PETHIAS CHITSUNGO vs D. MASUKU and RUWA LOCAL BOARD
Ruled By: MTSHIYA J

HB37-09 : MARGRET CAROL COLER vs MAXWEL SHUMBA
Ruled By: KAMOCHA J

HB46-09 : HERBERT SIKHOSANA vs ESTATE LATE A MTSANA and SHOWLAST NCUBE and NAPFUTALI SIBANDA and ZANELE NCUBE and NOKUTHULA MTHETHWA and ORS
Ruled By: NDOU J

HB94-09 : NOMALANGA SIBANDA vs GIVEN NYATHI and SEHLISO NYATHI and THE REGISTRAR OF DEEDS, BULAWAYO and BEN BARON AND PARTNERS
Ruled By: KAMOCHA J

HH11-10 : NABANE ROY TSHUMA vs TONGAI MUSEMBURI and TENDAI MUSEMBURI and MACKSON TOTSHANE NCUBE and THE REGISTRAR OF DEEDS
Ruled By: KARWI J

HH25-10 : MAXWELL MATSVIMBO SIBANDA vs GWYNNE ANNE STEVENSON
Ruled By: CHITAKUNYE J

HH67-10 : JAMES MUTETWA vs BARRIE DIXON and MARKO MAVHURUNE N.O. (as Executor Estate Late Samuel Mushaninga) and KENIAS MUTYASIRA N.O. (as Executor Estate Late Salome Chisvo) and REGISTRAR OF DEEDS
Ruled By: MAKARAU JP

HH107-10 : CHIROSWA MINERALS (PRIVATE) LIMITED and BASE MINERALS (PRIVATE) LIMITED vs MINISTER OF MINES and MORIS TENDAI NYAKUDYA and VAMBO MILLS (PRIVATE) LIMITED
Ruled By: BHUNU J

View Appeal
SC36-13 : DINESH MANIAL NARAN vs RONNAH MAFURIRANO and THE REGISTRAR OF DEEDS
Ruled By: CHIDYAUSIKU CJ, ZIYAMBI JA and MAKONESE AJA

HH160-10 : TONDERAI HAMANDISHE and GAMUCHIRAI SANGARE vs MAFFACK PROPERTIES (PVT) LTD
Ruled By: MTSHIYA J

HH161-10 : NEVER BVOCHORA vs DOUGLAS TOGARASEI MWONZORA (In his capacity as The executor Dative of the Estate Late I.V. Rukatya)
Ruled By: HUNGWE J

HB12-10 : BETTY GASELA vs LEONARD MALINGA and BULAWAYO CITY COUNCIL and THE REGISTRAR OF DEEDS
Ruled By: KAMOCHA J

HB63-10 : SALLY MAPLANKA vs B. A. NCUBE HOLDINGS
Ruled By: NDOU J

HH11-13 : FLORENCE SIGUDU vs MINISTER OF LANDS AND RURAL RESETTLEMENT N.O. and PHINEAS CHIHOTA
Ruled By: PATEL J

HH147-11 : FANUEL MWAYERA vs MOLLY CHIVIZHE and STANLEY CHIVIZHE and THE REGISTRAR OF DEEDS and GILBERT JONGA
Ruled By: CHITAKUNYE J

Appealed
HH158-11 : TRUSTCO MOBILE (PTY) LIMITED and TRUSTCO GROUP INTERNATIONAL (PTY) LIMITED vs ECONET WIRELESS (PRIVATE) LIMITED and FIRST MUTUAL LIFE ASSURANCE COMPANY (PRIVATE) LIMITED
Ruled By: MUTEMA J

HB65-13 : ANATOTH MINING (PVT) LTD vs BRIGHTON NYAMUCHO and GARLOREM RESOURCES (PVT) LTD t/a KIMS INVESTMENTS
Ruled By: KAMOCHA J

HB158-13 : KERRIES ENGINEERING (PVT) LTD vs MAKOMO RESOURCES (PVT) LTD
Ruled By: MAKONESE J

HH338-14 : MAFIRAMBUDZI FAMILY TRUST vs LIBERTY MADZINGIRA and PANNAH NHIWATIWA and THE REGISTRAR OF DEEDS N.O. and THE SHERIFF
Ruled By: TAKUVA J

View Appeal
SC43-13 : ECONET WIRELESS (PVT) LTD vs TRUSTCO MOBILE (PROPRIETARY) LTD and TRUSTCO GROUP INTERNATIONAL (PROPRIETARY) LTD
Ruled By: MALABA DCJ, ZIYAMBI JA and GARWE JA

HH535-15 : BLESSMORE CHANAKIRA vs SHEPHERD MALCOM N.O. and REGISTRAR OF DEEDS and PHIL RUSCH
Ruled By: NDEWERE J

HH128-06 : DOBROCK HOLDINGS (PVT) LTD and TURNER AND SONS (PVT) LTD vs TURNER AND SONS (PVT) LTD and ANTHONY TURNER and MARTIN KING and ZAMBEZI PADDLE STEAMER (PVT) LTD and DOBROCK (PVT) LTD
Ruled By: KUDYA J

HH797-15 : PETER KAZINGIZI and THERESA MUCHABAIWA KAZINGIZI vs EQUITY PROPERTIES (PVT) LTD
Ruled By: MATHONSI J

HB149-16 : MUNATSI SHOKO vs OLD MUTUAL ZIMBABWE LIMITED
Ruled By: MOYO J

HH114-15 : THEMPSON MUZVAGWANDOGA and DZOKAI MUZVAGWANDOGA vs MAI-KAI REAL ESTATE DEVELOPMENT TRUST and BERNARD MUTANGA and MOLLY DINGANI and THE REGISTRAR OF DEEDS
Ruled By: MAFUSIRE J

HB157-16 : NRZ CONTRIBUTORY PENSION FUND vs JOSRO ENTERPRISES (PVT) LTD t/a ASCOT PUB & GRILL
Ruled By: TAKUVA J

Appealed
HH151-16 : SHORAI NZARA and ARROLA IDEHEN and AMOSOGE IDEHEN and OSARETIN IDEHEN and vs CECILIAH KASHUMBA N.O. and REGISTRAR OF DEEDS and MASTER OF THE HIGH COURT and TAFIRENYIKA KAMBARAMI
Ruled By: MAFUSIRE J

HH63-13 : BLESSMORE Z. MABVURAMITI vs ALTFIN INSURANCE COMPANY
Ruled By: MAFUSIRE J

Appealed
HH86-13 : GOLDEN MILLION ENGINEERING (PVT) LTD vs METTALON GOLD ZIMBABWE (PVT) LTD
Ruled By: KUDYA J

Appealed
SC05-18 : JENNIFER BROOKER and ADRIENNE PIERCE vs RICHARD MUDHANDA and THE REGISTRAR OF DEEDS
Ruled By: GOWORA JA, HLATSHWAYO JA and BHUNU JA

View Appeal
HH637-15 : RICHARD MUDHANDA vs JENNIFER BROOKER and REGISTRAR OF DEEDS
Ruled By: MUREMBA J

Appealed
SC58-20 : YUSUF GAIBIE and MILLY GAIBIE N.O. vs ALEXANDER CASTANHEIRA and RACHEL CASTANHEIRA
Ruled By: GARWE JA, BHUNU JA and MAKONI JA

View Appeal
HB179-18 : YUSUF GAIBIE and MAHMOUD GAIBIE vs ALEXANDER CASTANHEIRA and RACHEL CASTANHEIRA
Ruled By: MAKONESE J

SC107-20 : COLCOM FOODS LIMITED vs TARUVA TARUVA
Ruled By: GWAUNZA DCJ, GUVAVA JA and MATHONSI JA

HH39-11 : BLUMO TRADING (PVT) LTD vs NELMAH MILLING COMPANY (PVT) LTD and NELSON MAHUPETE
Ruled By: PATEL J