The plaintiff, Zimbabwe United Passenger Company, better known as ZUPCO, issued summons in 2006 for the eviction of the defendants or any persons occupying the premises through them, to vacate premises known as No.9 Hood Rd, Southerton, Harare.
Zimbabwe United Passenger Company (ZUPCO) also sued for costs, jointly and severally, on a higher scale.
The background to the claim was that Zimbabwe United Passenger Company (ZUPCO) initially entered into a one year lease agreement with the defendants in November 2001, which lease commenced in January 2002 to the end of that year.
Subsequently, on 25 November of 2003, a letter had been written by the then Chief Operating Officer, as well as the then Acting Finance Controller, communicating the renewal of the lease agreement for a five year period with effect from 1 January 2004 to December 2009.
This being during the Zimbabwean dollar era, rentals payable were pegged at Z$1,000,000 and were to be reviewed quarterly.
The lease was to be renewable for a further five years on agreed terms and conditions.
Endorsed in handwriting on the letter was also, that, the actual lease agreement would be submitted for signing.
No written agreement, however, was ultimately ever signed.
The first and second defendants are Mr Jayesh Shah and Gift Investments (Pvt) Ltd, respectively. Mr Jayesh Shah was the Managing Director of Gift Investments (Pvt) Ltd at the relevant time.
In seeking the defendants vacation from the premises, Zimbabwe United Passenger Company (ZUPCO), in its declaration, stated that the defendants had become statutory tenants with effect from 31 December 2003, and, that it now required the premises for its own use.
In the alternative, Zimbabwe United Passenger Company (ZUPCO) pleaded that the termination of the first lease, and, upon failure to reduce the new agreement into a written lease, an implied lease agreement was entered into for a period of five years with rentals reviewable quarterly.
Further, they pleaded that the agreement could be terminated on three months notice.
Upon breach for failure to pay rentals, Zimbabwe United Passenger Company (ZUPCO) pleaded that it was entitled to terminate the lease agreement.
Zimbabwe United Passenger Company (ZUPCO) later amended its claim to insert a further alternative claim, being that, on 15 October 2003, the first defendant, Jayesh Shah, had corruptly paid a bribe to the then Chairman of ZUPCO, Professor Nherera, and to its then Chief Executive Officer, Mr Bright Matonga, in order to induce the renewal of the lease from 1 January 2004 to 31 December 2009.
It was also averred, in the amendment, that, ZUPCO's board was not aware of this and only became privy of this through an affidavit deposed to by Jayesh Shah indicating that he had paid US$20,000 at US$10,000 apiece, to each of them, for the purposes of inducing the extension of the lease.
Zimbabwe United Passenger Company (ZUPCO) therefore averred that the extension of the lease was not enforceable.
The defendants refused to vacate.
The essence of their plea was that there was a lease agreement communicated to them, by way of a letter, indicating that the terms were to be reduced to writing. The defendants further emphasised, that, the fact that no standard lease agreement was ultimately signed, did not mean there was no lease agreement.
They denied breaching the lease and put Zimbabwe United Passenger Company (ZUPCO) to the strictest proof thereof.
As regards the purported bribe, the defendants stance was that they paid in circumstances that amounted to extortion and that Zimbabwe United Passenger Company (ZUPCO) was bound by the terms of the agreement as its then Chief Executive Officer and the then Chairperson of ZUPCO, to whom the money had been paid, had been acting in their official capacity.
Whilst summons were issued in 2006, due to delays by the parties themselves, the matter was finally only heard in 2015.
Even then, there was a break in the trial as the parties had unsuccessfully tried to find each other.
Of significance is that by the time trial was heard, in 2015, the lease period in the disputed lease had long since expired and had not been renewed.
The Evidence
Professor Chipo Dyanda gave evidence on behalf of Zimbabwe United Passenger Company (ZUPCO) in her capacity as the Chairperson of the ZUPCO Board at the time of the trial, and having been a Board member in 2002.
Her evidence in chief was that the Board had made a resolution, in 2005, that it needed the premises for its own use due to its growing fleet. Whereas in 2002, when the premises had originally been leased, they had a negligible fleet; her evidence was that by 2005 their fleet had grown such that they now needed the premises. The fleet had grown to about 100 buses at the time.
This need had been communicated in writing to the defendants and notice had been given asking them to vacate by 31 May 2005.
It had also been communicated in that letter, that, the rentals payable were below market value and would be increased from Z$1 million a month to Z$34 million.
She further explained, that, its Northern Division has had to rent premises in Chitungwiza which she said would not have been necessary if they had access to their own property. Accidents were said to sometimes occur as shunters fail to manoeuvre the limited space at these other depots.
About 350 buses were said to have been bought between 2011 and 2014 and some were being refurbished. The size of the fleet was described as approximately 500 buses.
ZUPCO's efforts to diversify its operations include a cargo division was also highlighted to, as well as its intended acquisition of new buses which will take its fleet to approximately 600.
She stated, that, at the very least, given the resistance to leave, ZUPCO's expectation had been that the defendants would vacate once the lease expired, since the lease that the defendants placed reliance on had not been renewed.
She also emphasized ZUPCO's status as a State enterprise which needs to effectively discharge duties and was being hampered from doing so by the continued occupation of the premises by the defendants.
In terms of the non-payment of rentals at the material time the summons were issued, what she put to the court was that the defendants had persistently, at the material time, refused to pay the rentals asked for and were at one time paying as little as $1 due to the high rate of inflation at the time.
Her evidence was whilst the finer details were operational issues, in any event ZUPCO was not seeking any backdated rentals.
The reason why the defendants had refused to vacate was said to be because they had a lease agreement which was valid until 2009.
She stressed, that, with 2009 having come and gone, whatever had been the basis for his refusal to vacate had ended.
She also emphasised that ZUPCO's position, in any event, had been that there was no lease agreement since the purported lease had not been reduced to writing.
Mr Shah, who was the Managing Director of Gift investments (Pvt) Ltd at the time the lease agreement was entered into, gave evidence.
He had negotiated the lease on behalf of Gift Investments (Pvt) Ltd.
The gist of his evidence was that apart from leasing the premises from Zimbabwe United Passenger Company (ZUPCO), Gift Investments (Pvt) Ltd had also been a supplier of buses and spares to ZUPCO.
He said, as at February 2005, it was owed a sum of Z$2,735,561,369=86 by ZUPCO from which he stated that ZUPCO could have offset its rentals since it was at that time that ZUPCO had given notice of its rental increase.
The reason for the defendants objection to the payment of increased rentals, at the time, was said to be because the amount represented a 3,400% increase.
The defendants preference had been that the matter be referred to the Rent Board which it said Zimbabwe United Passenger Company (ZUPCO) had not done.
There were other subsequent letters as regards rental increases which he said all included increases that were exorbitant.
Mr Shah stressed, that, having been forced to pay the then Chairperson of ZUPCO, Professor Nherera, and the then CEO, Mr Matonga, US$20,000 the quest for his eviction was spurred by his subsequent refusal to pay them a further bribe of US$5,000 for every bus supplied by Gift Investments (Pvt) Ltd to Zimbabwe United Passenger Company (ZUPCO).
He said he had refused and had instead reported the matter to various arms of Government.
Whilst he conceded refusing to pay the rentals that were being asked for on account of the sums being exorbitant, he stated he was never technically in arrears as claimed since the defendants paid what they deemed due in the absence of the Rent Board's approval.
He also stressed that Zimbabwe United Passenger Company (ZUPCO) in fact owed it money and that spares had been ordered on its account which they were still holding in stock. These stocks, held on behalf of ZUPCO, were said to be well over a million dollars.
He also complained of the defendant's refusal to take into consideration the fact that improvements had been done to its premises and that permanent structures had been put up.
A commitment was said to have been made to give him the option to purchase and it was said that investments on the premises had been made on that ground.
He maintained that the purported eviction was because of the refusal to pay the two ZUPCO officials US$5,000 per bus - this was despite the fact that the two officials had long since left ZUPCO.
The need by Zimbabwe United Passenger Company (ZUPCO) of its own premises was denied.
Only Mr Shah gave evidence, but, it was very apparent from his evidence, that, his interests and those of Gift Investments (Pvt) Ltd were in fact inseparable.
The second defendant, who was legally represented, opted to not to give evidence despite having cross examined the first defendant, as if their interests were separate, and having asked leading questions of the first defendant.
The purpose of this cross-examination appears to have been to merely enter information into the record.
Not surprisingly, the plaintiff's counsel raised valid objections to the stance that had been adopted by the second defendant's counsel when it became clear, that, the second defendant would not be giving evidence as there would be no opportunity to cross examine the second defendant.
The High Court Rules 1971 are clear on co-defendants who are represented by different legal practitioners and where their interests are the same:
“443. Legal practitioner for co-defendants: cross-examination: order of addresses Co-defendants may be represented by different legal practitioners
Where the interests of the defendants are the same, the case shall proceed as though the defence were joint and not separate. Where the interests of the defendants are different, the legal practitioner for each defendant shall be allowed to cross-examine plaintiff's witnesses and to address the court in such order as the court shall decide.”
Of significance is that where the interests of the co-defendants are the same, the Rules are clear that the case shall proceed as though the defence were joint and not separate.
It was very clear from Mr Shah himself, that, at the material time, he was the Managing Director of Gift Investments (Pvt) Ltd and that he continues to have interests in this company as a major investor.
At the start of the trial, the defendants had indicated that they were proceeding by way of separate representation on account of Mr Shah having been a former director and having separate interests.
Where interests are said to be separate, the rules of the High Court 1971 provide as follows:
“444. Procedure where co-defendants are opposed in interest to each other
Where co-defendants are opposed in interest to each other, permission may be given to each defendant, or set of defendants, to open and prove their cases separately as well as to cross examine each other's witnesses.”
No such permission was sought to cross-examine.
The separation of Mr Shah from Gift Investments (Pvt) Ltd, at the start of the trial, had been in attempt to argue that the lease agreement had not been entered into with Gift Investments (Pvt) Ltd, but, with Mr Shah.
I had dismissed this argument in the application for absolution from the instance: see ZUPCO v Jayesh Shah & Anor HH644-16.
The cross examination of Mr Shah, by the second defendant, as co-defendant, was therefore not proper and is disregarded in this case.
