On 11 March 2015, the High Court granted part of the claim sought by Valentine Ziswa and his wife Margaret Ziswa (the cross appellants) against Graeme Shaun Chadwick and Landos (Pvt) Ltd (the cross respondents).The court a quo dismissed the claims of the cross-appellants as against the second cross-respondent in ...
On 11 March 2015, the High Court granted part of the claim sought by Valentine Ziswa and his wife Margaret Ziswa (the cross appellants) against Graeme Shaun Chadwick and Landos (Pvt) Ltd (the cross respondents).
The court a quo dismissed the claims of the cross-appellants as against the second cross-respondent in their entirety and granted part of the claims as against the first cross respondent.
The cross appellants seek a reversal of the dismissal orders issued a quo.
The order issued by the court a quo reads as follows:
“In the result, it is ordered that:
1. The plaintiffs claims against the second defendant are hereby dismissed with costs.
2. The plaintiffs claim (a) against the first defendant succeeds only in the sum of $8,808 which the first defendant is directed to pay the plaintiffs.
3(a) The plaintiffs claim (e) partially succeeds to the extent of the 4km LTC Electric cable while the rest is hereby dismissed.
(b) The first defendant shall pay to the plaintiffs the sum of $84,000 being the replacement value of the LTC electric cable removed from the plaintiffs farm.
4. The first defendant shall pay the plaintiffs the sum of $780 being value of labour hired to clear tobacco stalks and related expenses.
5. The plaintiffs claims (b), (c), (d), (f), (g), (j) and (l) are hereby dismissed.
6. Absolution from the instance is granted in respect of plaintiffs claims (h) and (k).
7. The plaintiffs shall pay 20% of the first defendant's costs of suit.”
The first cross appellant is Valentine Ziswa (Ziswa) while the second cross-appellant is his wife, Margaret Ziswa. I will cumulatively refer to them in this judgment as the lessor.
The first cross-respondent is Graham Shaun Chadwick (Chadwick) and the second cross-respondent is Landos (Pvt) Ltd (the Company).
Graham Shaun Chadwick was a director in Landos (Pvt) Ltd, which he also used as his special purpose vehicle or agent to conduct his farming operations on Ziswa Farm (the farm) and on three other surrounding farms, namely, Gijima, Kelvin, and Landos.
THE BACKGROUND
On 20 March 2015, Graham Shaun Chadwick filed a defective Notice of Appeal against the cross appellants, which did not indicate the part of the judgment he sought to impugn.
He, thereafter, filed a contested chamber application for condonation and extension of time within which to appeal on 11 January 2018, which was dismissed with costs on 21 March 2018.
The effective disposal of the main appeal in this manner left the cross appeal pending.
FACTS
On or before 1 September 2008, Valentine Ziswa and Graham Shaun Chadwick entered into a verbal agreement for the lease of the farm and the inventoried equipment. The description, quantities, and state of the leased equipment was recorded in the comprehensive inventory the parties drew in October 2008.
The tobacco season in Zimbabwe generally runs from September to August and sales generally take place between March and June.
Graham Shaun Chadwick was on the farm during the 2008-2009, 2009-2010, 2010-2011, and 2011-2012 seasons (hereinafter called the first, second, third, and fourth seasons, respectively).
On 9 January 2009, Valentine Ziswa and Graham Shaun Chadwick signed a 10-year lease agreement.
On the same date, Valentine Ziswa and his wife (the First Partner) executed a second “Joint Venture Agreement” (JVA) with Graham Shaun Chadwick (Second Partner) for the “long term development” of the farm.
The two agreements were backdated to 1 September 2008.
Graham Shaun Chadwick not only leased the farm and the inventoried property, but, in addition, undertook to erect permanent structures (in each season) of an equivalent value to the seasonal rental payable.
In terms of clause 1 and clause 2, Graham Shaun Chadwick leased “the land, together with all buildings and other permanent improvements and certain immovables” for the ten year period from 1 September 2008 to 31 August 2018 for the purpose of growing “30ha of tobacco, 40ha of maize, 20ha of wheat and any other crop agreed between the parties.”
In terms of clause 3, the rental payable would be “6 per cent on the US$ of the gross turnover of the crops produced on the said land inclusive of bonuses and hailstorm insurances.”
In respect of tobacco, the rent was to be paid into the lessor's FCA by stop order raised at the auction floor, and cash payments were to be made in respect of other crops.
In addition to the rental, Graham Shaun Chadwick would, in terms of clause 4(d), be responsible for the repairs and maintenance of tractors and the inventoried equipment leased to him with effect from 1 September 2008.
Lastly, clause 9 stipulated that:
“This agreement constitutes the entire agreement between the parties, and no representation or undertakings given by one of them to the other of them prior to the execution hereof, and no variation of the conditions hereof, shall have any force or effect unless recorded in writing and executed by the parties hereof.” (The underlining covers the handwritten portions of the otherwise typeset agreement).
The Joint Venture Agreement (JVA) substantially duplicates the lease agreement. Clause 3 thereof reads as follows:
“3. The rent payable by the lessee to the lessor shall be 6 per cent per centum of the gross turnover in respect of the crops produced on the said land, and payment of such rent/lease shall be secured by means of STOP ORDER given by the lessee in favour of the Company against proceeds of tobacco sold through TOBACCO SALES FLOOR. Such PAYMENT shall be executed and registered as soon (sic) may be after the signing of this lease. 31 MARCH, 3 APRIL, 6 END OF JULY. MAIZE 1.5 TON MONTHLY.” (The underlined words and figures are handwritten)
It was common cause that the two agreements are complementary and separate and distinct. The requirements of the Joint Venture Agreement (JVA) were additional to the rental payable.
It was also common cause, that, Graham Shaun Chadwick was an active councillor for the Zimbabwe Tobacco Association (ZTA) for six (6) years and had been its Vice-President for another two (2) years.
He introduced the Zimbabwe Tobacco Association (ZTA) proforma lease and Joint Venture (JV) agreements, and, together with Valentine Ziswa, supplemented and annotated the terms and conditions therein by hand.
Graham Shaun Chadwick grew maize during the first season only and abandoned it in subsequent seasons in preference to the more lucrative tobacco crop. He never grew wheat on the farm.
Graham Shaun Chadwick did not abide by the direct deduction method prescribed in the agreements. He did not disclose to the lessor his prior preferential stop order obligations to the Zimbabwe Leaf Tobacco Company (Pvt) Ltd.
By 10 May 2010, Graham Shaun Chadwick had repaired a weir, put in a pump and generator, laid underground irrigation pipes, erected a centre pivot, paid for the labour for the reconstruction of a burnt down tobacco barn “maintained” all 14 barns by putting in place the necessary appurtenances for curing tobacco, repaired furnaces and sheds, and, at a cost of US$2,700 constructed 11 two roomed staff houses.
By letter dated 22 February 2011, Graham Shaun Chadwick offered to increase lease rental to 8%.
The offer was not accepted.
Instead, the lessor made the counter offer proposed in the detailed draft agreement, which the lessor signed on 13 March 2011.
The counter-offer was, in turn, rejected by Graham Shaun Chadwick.
Between 10 January 2012 and 18 May 2012, the parties failed to amicably resolve the lessor's demands for arrear rentals, maintenance of the leased equipment, and the repatriation of leased property that Graham Shaun Chadwick allegedly took to other farms.
In frustration at the impasse, the lessor sought to exercise a lien over the tobacco produce that was on the farm.
They were, by consent, interdicted by Graham Shaun Chadwick and Landos (Pvt) Ltd, on 24 May 2012 in case No. HC5477/12.
On 10 June 2012, the Ziswas instigated the arrest of Graham Shaun Chadwick for theft of some of the 2008 inventoried property. The complete police docket, compiled by Sergeant N'andu (IO), was produced by consent as exhibit 5.
Sergeant N'andu (the IO) first attended at the farm on 12 June 2012. On 19 June 2012, he conducted a verification or “exit” inventory with Valentine Ziswa and a proxy of Graham Shaun Chadwick, at the direction of the Area Public Prosecutor for Rusape (APP).
By letter dated 2 July 2012, Graham Shaun Chadwick cancelled the lease agreement and immediately vacated the farm.
On 5 September 2012, the Area Public Prosecutor for Rusape declined to prosecute, adjudging the criminal complaint to be a civil dispute.
On 26 September 2012, the lessor issued summons against the defendants claiming an aggregate sum of US$456,699 under 13 heads. These comprised of the following claims:
(a) Arrear rentals of US$64,160 for the fourth farming season;
(b) A refund of rates and levies of US$1,980 paid to the Makoni Rural District Council for the fourth farming season;
(c) The lessor's share of the hailstorm insurance proceeds of US$5,500 in respect of the second farming season;
(d) The outstanding developments for the first three farming seasons, represented by the value of the centre pivot that was removed from the farm, in the sum of US$67,507;
(e) Other enumerated property valued at US$187,707 that was also removed from the farm;
(f) The estimated damages to recovered property of US$15,905;
(g) US$7,600 for the damage to the fence and gates on the farm;
(h) US$15,008 for the repairs to the damaged tobacco barns and flue pipes;
(i) US$780 for removing the fourth season tobacco stalks;
(j) US$26,313 for vandalized overhead water storage tanks, pipes, workers houses, electrical underground cables, dams, pump unit, boreholes, and transformer;
(k) US$15,000 for maize deliveries contractually due to the lessor during the second to fourth farming seasons;
(l) US$4,240 for the tobacco seedlings grown on the farm and sold to other farmers;
(m) US$45,000 damages for loss of income in respect of the 2012/2013 tobacco cropping season caused by the premature and abrupt termination of the agreements.
THE PROCEEDINGS A QUO
The lessor made the following contentions:
The two agreements had separate and distinct obligations. Landos (Pvt) Ltd had a direct and substantial interest in the two agreements, and was, together with Graham Shaun Chadwick, therefore liable for the various contractual breaches that gave rise to the 13 claims.
The lessor's documentary and oral evidence established both liability and quantum in respect of claim (a), (d), (e), (f), (g), (h), (j), (k) and (l) at the higher rate of 8 per cent and not at the 6 per cent in the two agreements.
The lessor abandoned claim (m) and conceded that Graham Shaun Chadwick and Landos (Pvt) Ltd be absolved from the instance in respect of claims (b), (c) and (i) on the ground that the lessor had failed to established the due amounts.
Graham Shaun Chadwick conceded that the annotations formed part of the terms agreed by the parties on 9 January 2009.
