Law Portal
Zimbabwe

Welcome To Law Portal

Welcome, Guest!
[Help?]

SC85-20 - JOHN LEGGETT and EARTHMOVING AND CONSTRUCTION COMPANY PL vs ASSWEL GURUPIRA and JEAN GURUPIRA and SANDRA MUIR and THE REGISTRAR OF DEEDS and THE SHERIFF and THE DEPUTY SHERIFF

  • View Judgment By Categories
  • View Full Judgment

View Appeal


Company Law-viz shareholding re share transactions iro allotment of shares.
Law of Property-viz proof of title re immovable property iro registered rights.
Law of Contract-viz purchase and sale re purchase price iro terms of payment.
Procedural Law-viz rules of evidence re documentary evidence.
Law of Contract-viz specific performance re specific performance ex contractu.
Law of Property-viz passing of ownership re implied lawful right of ownership.
Law of Property-viz double sales.
Law of Property-viz competing claims.
Law of Property-viz res litigiosa re judicial caveat iro the anti-dissipation interdict.
Law of Property-viz res litigiosa re examiner's caveat.
Procedural Law-viz locus standi re factual averments ordinarily available to another party.
Procedural Law-viz affidavits re founding affidavit iro deponent.
Procedural Law-viz automatic bar.
Procedural Law-viz service of court process re proof of service iro contractual service.
Procedural Law-viz appeal re supplementary affidavits iro supplementary heads of argument.
Procedural Law-viz affidavits re supplementary affidavits iro supplementary heads of argument.
Company Law-viz shareholding re asserting rights on behalf of a company iro derivative action.
Company Law-viz shareholding re enforcement of rights on behalf of a company iro the proper plaintiff rule.
Procedural Law-viz locus standi re asserting rights on behalf of a corporate entity iro derivative action.
Procedural Law-viz locus standi re enforcement of rights on behalf of a corporate entity iro the proper plaintiff rule.
Procedural Law-viz findings of fact re assessment of evidence iro the doctrine of estoppel.
Procedural Law-viz default judgment re rescission of default judgement.
Procedural Law-viz final orders re parties affected by a court order iro cited parties to the proceedings.
Procedural Law-viz affidavits re founding affidavit iro deponent.
Procedural Law-viz service of court process re contractual address for service iro domicilium citandi et executandi.
Procedural Law-viz pleadings re un-opposed proceedings.
Procedural Law-viz pleadings re unopposed proceedings.
Company Law-viz shareholding re share transactions iro allotment of shares.
Law of Contract-viz termination of contracts re automatic lapsing of an agreement iro notice of cancellation.
Law of Contract-viz cancellation of agreements re automatic lapsing of a contract iro notice of termination.
Procedural Law-viz rules of evidence re evidence of oath iro sworn affidavit.
Procedural Law-viz rules of evidence re evidence on oath iro sworn affidavit.
Procedural Law-viz evidence of oath re sworn affidavit iro perjury.
Procedural Law-viz evidence on oath re sworn affidavit iro perjury.
Law of Contract-viz essential elements re intent iro simulated agreements.
Law of Contract-viz essential elements re animus contrahendi iro simulated agreements.
Procedural Law-viz affidavits re founding affidavit iro the principle that a case stands or falls on the founding affidavit.
Procedural Law-viz affidavits re founding affidavit iro the rule that a case stands or falls on the founding affidavit.
Procedural Law-viz pleadings re non pleaded issues iro matters for determination by the court.
Procedural Law-viz pleadings re matters not specifically pleaded iro issues for determination by the court.
Procedural Law-viz cause of action re draft order.
Procedural Law-viz final orders re relief overriding extant orders of court.
Procedural Law-viz final orders re relief overriding of an extant court order.

Findings of Fact re: Assessment of Evidence and Inferences iro Evidentiary Concessions & Conduct Resulting in Estoppel

This is an appeal against a judgment of the High Court handed down on 18 May 2016.

BACKGROUND FACTS

The facts which gave rise to this appeal are somewhat convoluted. Earthmoving & Construction Company (Private) Limited, the second appellant (hereinafter referred to as “the Company”), is a private limited company duly registered as such under the laws of Zimbabwe.

The Company had, at the time of incorporation, an authorized share capital of $32, divided into 32,000 ordinary shares with a nominal value of $0.001 each. Of those shares, only two had been issued. and were, at the time that these events evolved, owned by one Sandra Maureen Muir (“Mrs Muir”). This, in effect, gave 100 percent ownership of the issued shares to Mrs Muir.

In turn, the Company is the registered owner of an immovable piece of land, situate in Harare, identified as a certain piece of land situate in the district of SALISBURY TOWN LANDS measuring 3,066 square metres (also known as 98 Churchill Avenue, Gunhill, Harare). This property is the sole asset of the company.

On 27 May 2007, Mrs Muir concluded a written agreement of sale with Mr and Mrs Gurupira, in terms of which Mrs Muir sold to them the two shares in the Company. In terms of the agreement between the parties, the shares purchased by the Gurupiras' would entitle them to the “exclusive right of use and occupation” of the immovable property owned by the company. The purchase price for the shares was recorded as ZW$7,000,000,000= (seven billion dollars), payable as to a deposit of ZW$3,300,000= which was acknowledged as having been paid at the time of signing of the agreement. The balance of ZW$3,370,000,000= was to be paid within six (6) months from the date of the agreement. The rate at which the outstanding balance was to be paid as well as the frequency thereof were left to the discretion of the parties.

Although the purchase price was quoted in the local currency, it is common cause that the Gurupiras made sporadic payments sometimes in fuel, sometimes in US Dollars, and sometimes in Zimbabwe Dollars.

Up until the end of June 2007, the Gurupiras had made payment on eight occasions, with payment being made as described above. The total amount paid to Mrs Muir under this arrangement is in dispute between the parties.

On 4 August 2007, the Gurupiras addressed a letter to Mrs Muir indicating that they were encountering challenges raising the balance of the purchase price and sought an extension of the time to make payment but did not specify an exact date of expected payment. The last date for payment under the agreement was 25 November 2007.

A dispute ensued on the manner of payment, the currency of payment, and the place at which payment should be effected.

The Gurupiras alleged that at some point Mrs Muir started refusing payment in the local currency and demanded that the balance be paid in foreign currency. Mr Gurupira advised Mrs Muir that he could only pay foreign currency if he was able to access it and that he was not always in a position to obtain it. On 12 November 2007, Mr Gurupira instructed his legal practitioners to write to Mrs Muir to provide an account into which payment of the outstanding balance of the purchase price could be deposited. There was no response.

On 23 November 2007, the Gurupiras filed an application in the High Court seeking an order for Mrs Muir to provide a Bank account into which payment of the outstanding balance of the purchase price could be paid. In addition, they sought an order for specific performance by Mrs Muir for the transfer of shares in the company to themselves against a tender of payment of the balance of the purchase price.

This application never saw the light of day having been withdrawn before it could be set down.

The record shows that on 6 September 2007, the Gurupiras made a payment through wire transfer directly to Israel where Mrs Muir was now residing. Also on record is a cheque payment, in February 2008, into a Standard Chartered Bank account bearing Mrs Muir's name.

It is common cause that during the period following the filing of the above mentioned application Mrs Muir concluded a series of agreements with the first appellant, (“Leggett”).

On 11 December 2007, Mrs Muir and Leggett concluded an agreement in terms of which the latter would subscribe to 98 ordinary shares in the company. Subsequently, on 27 May 2008, Leggett concluded an agreement with Mrs Muir in terms of which the former purchased the entire shareholding in the company from Mrs Muir. Just as in the case of the Gurupiras, the purchase entitled him to “exclusive use and occupation” of the immovable property which is the subject matter of this appeal.

Subsequent to the conclusion of the first agreement, the Gurupiras became aware that Mrs Muir had placed advertisements for the sale of the immovable property. As a consequence, on 7 March 2008, under Case No. HC1393/08, the Gurupiras filed an application with the High Court in which they sought, variously, as against the company, interlocutory relief prohibiting the transfer of the immovable property, and, as against Mrs Muir, an order for specific performance in respect of the immovable property. The Registrar of Deeds, the Sheriff for Zimbabwe and his Deputy were also cited as third, fourth and fifth respondents respectively.

On 21 May 2018, the High Court granted an order in favour of the Gurupiras, in default of appearance from Mrs Muir and the company, as claimed in the draft order.

On 16 June 2008 the property was transferred to the Gurupiras under Deed of Transfer No. 4778/08. They proceeded to evict the occupant, one Diniwe Chinyani. She informed Leggett.

An urgent application for rescission of the default judgment was filed on behalf of the company. It was adjudged not urgent and was finally set down for hearing as an opposed matter. However, the matter was referred to trial on the premise that there existed material disputes of fact.

Pending the determination of the application for rescission, the company filed a counter application in which it sought an order for the eviction of the Gurupiras on the premise that it was the owner of the property in question.

On 19 March 2014, after a full trial, the High Court gave an order in terms of which the default judgment was set aside with leave being granted for “the respondent” in the main application to file opposing papers.

The main application was heard by the High Court on 21 May and 18 June 2015. By this time, pursuant to an application by the Gurupiras, Leggett had been joined as sixth respondent by order of the court. An issue arose as to whether Mrs Muir was before the court. The Gurupiras argued that she had not applied for the rescission of the default judgment in the sense that only the company had sought such rescission. It also transpired that Mr Stevenson, who purported to represent her on the day of the hearing, had not filed papers on her behalf nor did he appear to have the mandate to represent her.

On 18 May 2016 the High Court handed down its judgment and issued an order:

1. Declaring that the Gurupiras to be the lawful shareholders of the entire shareholding in the first respondent (the company) and that any purported transfer or appointment of directors by the sixth respondent (Leggett) be deemed to be null and void. (sic)

2. Directing the second respondent to sign all necessary documents to effect transfer of the above-mentioned shares. (sic)

3. That should the second respondent fail to sign the necessary documents to effect transfer of the shares, the Sheriff of the High Court be directed to sign all necessary documents to effect transfer of the shares to the Gurupiras.

4. The first and sixth respondents shall bear the costs of this application on an attorney and client scale jointly and severally each causing the other to be absolved. (sic)

5. Dismissing the sixth respondent's counter-application.

It is this decision that Leggett has brought on appeal and Mrs Muir is cited as third respondent to the appeal....,.

Counsel for the respondents also took a point in limine on the appeal by the second appellant. He submitted that legally a company could only be represented by a director and not a shareholder, which the first appellant described himself as. Accordingly, he argued that there there was no proper appeal by the second appellant before the court.

I do not intend to let this argument detain me.

The first and second respondents have been litigating with the second appellant from the onset. In documents filed by the first appellant in defence of the second appellant, the former has always referred to himself as a shareholder and director of the second appellant. 

The point in limine is groundless and is dismissed.

Default Judgment re: Rescission of Judgment iro Approach

This is an appeal against a judgment of the High Court handed down on 18 May 2016.

BACKGROUND FACTS

The facts which gave rise to this appeal are somewhat convoluted. Earthmoving & Construction Company (Private) Limited, the second appellant (hereinafter referred to as “the Company”), is a private limited company duly registered as such under the laws of Zimbabwe.

The Company had, at the time of incorporation, an authorized share capital of $32, divided into 32,000 ordinary shares with a nominal value of $0.001 each. Of those shares, only two had been issued. and were, at the time that these events evolved, owned by one Sandra Maureen Muir (“Mrs Muir”). This, in effect, gave 100 percent ownership of the issued shares to Mrs Muir.

In turn, the Company is the registered owner of an immovable piece of land, situate in Harare, identified as a certain piece of land situate in the district of SALISBURY TOWN LANDS measuring 3,066 square metres (also known as 98 Churchill Avenue, Gunhill, Harare). This property is the sole asset of the company.

On 27 May 2007, Mrs Muir concluded a written agreement of sale with Mr and Mrs Gurupira, in terms of which Mrs Muir sold to them the two shares in the Company. In terms of the agreement between the parties, the shares purchased by the Gurupiras' would entitle them to the “exclusive right of use and occupation” of the immovable property owned by the company. The purchase price for the shares was recorded as ZW$7,000,000,000= (seven billion dollars), payable as to a deposit of ZW$3,300,000= which was acknowledged as having been paid at the time of signing of the agreement. The balance of ZW$3,370,000,000= was to be paid within six (6) months from the date of the agreement. The rate at which the outstanding balance was to be paid as well as the frequency thereof were left to the discretion of the parties.

Although the purchase price was quoted in the local currency, it is common cause that the Gurupiras made sporadic payments sometimes in fuel, sometimes in US Dollars, and sometimes in Zimbabwe Dollars.

Up until the end of June 2007, the Gurupiras had made payment on eight occasions, with payment being made as described above. The total amount paid to Mrs Muir under this arrangement is in dispute between the parties.

On 4 August 2007, the Gurupiras addressed a letter to Mrs Muir indicating that they were encountering challenges raising the balance of the purchase price and sought an extension of the time to make payment but did not specify an exact date of expected payment. The last date for payment under the agreement was 25 November 2007.

A dispute ensued on the manner of payment, the currency of payment, and the place at which payment should be effected.

The Gurupiras alleged that at some point Mrs Muir started refusing payment in the local currency and demanded that the balance be paid in foreign currency. Mr Gurupira advised Mrs Muir that he could only pay foreign currency if he was able to access it and that he was not always in a position to obtain it. On 12 November 2007, Mr Gurupira instructed his legal practitioners to write to Mrs Muir to provide an account into which payment of the outstanding balance of the purchase price could be deposited. There was no response.

On 23 November 2007, the Gurupiras filed an application in the High Court seeking an order for Mrs Muir to provide a Bank account into which payment of the outstanding balance of the purchase price could be paid. In addition, they sought an order for specific performance by Mrs Muir for the transfer of shares in the company to themselves against a tender of payment of the balance of the purchase price.

This application never saw the light of day having been withdrawn before it could be set down.

The record shows that on 6 September 2007, the Gurupiras made a payment through wire transfer directly to Israel where Mrs Muir was now residing. Also on record is a cheque payment, in February 2008, into a Standard Chartered Bank account bearing Mrs Muir's name.

It is common cause that during the period following the filing of the above mentioned application Mrs Muir concluded a series of agreements with the first appellant, (“Leggett”).

On 11 December 2007, Mrs Muir and Leggett concluded an agreement in terms of which the latter would subscribe to 98 ordinary shares in the company. Subsequently, on 27 May 2008, Leggett concluded an agreement with Mrs Muir in terms of which the former purchased the entire shareholding in the company from Mrs Muir. Just as in the case of the Gurupiras, the purchase entitled him to “exclusive use and occupation” of the immovable property which is the subject matter of this appeal.

Subsequent to the conclusion of the first agreement, the Gurupiras became aware that Mrs Muir had placed advertisements for the sale of the immovable property. As a consequence, on 7 March 2008, under Case No. HC1393/08, the Gurupiras filed an application with the High Court in which they sought, variously, as against the company, interlocutory relief prohibiting the transfer of the immovable property, and, as against Mrs Muir, an order for specific performance in respect of the immovable property. The Registrar of Deeds, the Sheriff for Zimbabwe and his Deputy were also cited as third, fourth and fifth respondents respectively.

On 21 May 2018, the High Court granted an order in favour of the Gurupiras, in default of appearance from Mrs Muir and the company, as claimed in the draft order.

On 16 June 2008 the property was transferred to the Gurupiras under Deed of Transfer No. 4778/08. They proceeded to evict the occupant, one Diniwe Chinyani. She informed Leggett.

An urgent application for rescission of the default judgment was filed on behalf of the company. It was adjudged not urgent and was finally set down for hearing as an opposed matter. However, the matter was referred to trial on the premise that there existed material disputes of fact.

Pending the determination of the application for rescission, the company filed a counter application in which it sought an order for the eviction of the Gurupiras on the premise that it was the owner of the property in question.

On 19 March 2014, after a full trial, the High Court gave an order in terms of which the default judgment was set aside with leave being granted for “the respondent” in the main application to file opposing papers.

The main application was heard by the High Court on 21 May and 18 June 2015. By this time, pursuant to an application by the Gurupiras, Leggett had been joined as sixth respondent by order of the court. An issue arose as to whether Mrs Muir was before the court. The Gurupiras argued that she had not applied for the rescission of the default judgment in the sense that only the company had sought such rescission. It also transpired that Mr Stevenson, who purported to represent her on the day of the hearing, had not filed papers on her behalf nor did he appear to have the mandate to represent her.

On 18 May 2016 the High Court handed down its judgment and issued an order:

1. Declaring that the Gurupiras to be the lawful shareholders of the entire shareholding in the first respondent (the company) and that any purported transfer or appointment of directors by the sixth respondent (Leggett) be deemed to be null and void. (sic)

2. Directing the second respondent to sign all necessary documents to effect transfer of the above-mentioned shares. (sic)

3. That should the second respondent fail to sign the necessary documents to effect transfer of the shares, the Sheriff of the High Court be directed to sign all necessary documents to effect transfer of the shares to the Gurupiras.

4. The first and sixth respondents shall bear the costs of this application on an attorney and client scale jointly and severally each causing the other to be absolved. (sic)

5. Dismissing the sixth respondent's counter-application.

It is this decision that Leggett has brought on appeal...,.

ISSUES FOR DETERMINATION ON APPEAL

Although the Gurupiras obtained an order for specific performance against Mrs Muir, which is the main issue in contention in this appeal, the starting point revolves around the issue of rescission of the default judgment of 21 May 2018.

1. In this appeal, the court has to determine the effect of the order for rescission given by MAFUSIRE J.

2. Consequent thereto is the issue as to whether Mrs Muir, following upon the rescission of the default judgment, was before the court a quo for the determination of the main application.

3. Additionally, there should be a determination as to whether the court a quo was correct in finding that the Gurupiras were entitled to specific performance. For the proper determination of this aspect on the merits, it stands to reason that Leggett and the company could only appeal if Mrs Muir was a party to the proceedings. Her absence militates against their contentions in that regard.

4. Lastly, the court had to decide whether Leggett was entitled to relief in respect of the shareholding transferred to him by Mrs Muir.

Given the issues raised in the rather extensive grounds, I have decided to deal with each ground of appeal separately ad seriatim.

AD GROUNDS 1 and 2 - WHETHER THE COURT A QUO ERRED IN FINDING THAT MUIR HAD BEEN PROPERLY SERVED, THAT, AS A CONSEQUENCE, MUIR WAS NOT BEFORE THE COURT AND HAD FAILED TO OPPOSE THE APPLICATION FOR SPECIFIC PERFORMANCE

These two grounds are interlinked as they are concerned with the same issue.

The application for the rescission of the default judgment was the sine qua non for any party seeking to oppose relief being claimed by the Gurupiras to have the leave of court to appear in opposition to such application.

As regards this issue, it was contended that the High Court had said that the issue was whether or not Mrs Muir was before the court. It was contended that due to the findings of fact made by MAFUSIRE J the court had to find that the judgment had been rescinded, thus affording her a right to oppose the relief sought by the Gurupiras.

Per contra, counsel for the respondents submitted that Mrs Muir had not appealed against the finding that she was not before the High Court. As a consequence, there was no opposition filed by her to the order sought by the Gurupiras.

The court a quo made the following critical findings;

It found that Mrs Muir had been properly served with the application. Further to that, it found that due to her failure to have the judgment granted in default rescinded as against her, she was not before the court.

The application for rescission was, on the order of the High Court, converted to a trial given the seeming myriad material disputes of fact on the papers. The witnesses called included Leggett, one Diniwe Chinyanga, L. T Nhari, a forensic documents examiner, and Thomas David Stevenson.

The last witness was appearing in his capacity as the legal practitioner of record for Mrs Muir.

Mrs Muir, however, did not launch an application for the rescission of the order made against her nor was she one of the witnesses who gave evidence before the High Court in support of the application for rescission of the default judgment.

Counsel for the appellants, Leggett and the company, submitted that the court a quo should have had regard to the evidence given to the court during the trial wherein the rescission of the default judgment was being considered.

It is pertinent to note that when the matter was heard by MAFUSIRE J, on 10 and 11 February 2014, there was only one party referred to as the plaintiff - and that was the company. Mrs Muir was cited as the third respondent in that matter. This is because the company had made the application for rescission. It cited Mrs Muir as a respondent. She did not file any papers. The judgment reflects that there was no appearance by Mrs Muir. The learned judge found that there had been no proper service of the application to compel specific performance as against Mrs Muir. He found, as a consequence, that there had not been proper service on Mrs Muir.

The critical question that begs an answer is what was before his Lordship. In other words, was Mrs Muir before his Lordship in an application for the setting aside of a judgment granted in default?

Such an application is governed by Rule 63 of the Rules of the High Court, 1971. Rule 63 is couched as follows:

(1) A party against whom judgment has been given in default, whether under these rules or under any other law, may make a court application, not later than one month after he has had knowledge of the judgment, for the judgment to be set aside.

(2) If the court is satisfied, on an application in terms of sub-rule (1), that there is good and sufficient cause to do so, the court may set aside the judgment concerned and give leave to the defendant to defend or to the plaintiff to prosecute his action on such terms as to costs and otherwise as the court considers just.

(3) Unless an applicant for the setting aside of a judgment in terms of this Rule proves to the contrary, he shall be presumed to have had knowledge of the judgment within two days after the date thereof.”

In my view, it was incumbent upon Mrs Muir, in the pursuit of the protection of her rights under the agreement with the Gurupiras, to apply, in terms of Rule 63, to have the judgment against her rescinded or set aside.

Even the order issued by MAFUSIRE J is of no assistance to her cause. It orders that “the plaintiff shall file its notice of opposition within ten days of the date of the order” - and it is common cause that the plaintiff in those proceedings was the company.

Notwithstanding his remarks on service, there is no order granting leave to Mrs Muir to file opposing papers. This is due to her absence from the proceedings from the beginning.

The court a quo found that, despite the presence of Mr Stevenson, who purported to act on her behalf, Mrs Muir was not before it. The court said:

It is trite that where the Notice of Opposition or affidavit is to be signed by a person other than the respondent, that person must show that he is authorised to do so. The authors Herbestein & Van Winsen - The Civil Practice of the High Courts of South Africa, 5th Ed, p437 put it this way;

'Where an application is made by an agent on behalf of a principal, an averment of the agent's authority is essential, unless it appears from the affidavits filed in the application that the principal is aware of and ratified the proceedings. A statement that the applicant is acting in the capacity of agent for the principal in question is a sufficient allegation of authority to make the application.'”

In casu, Mr Stevenson filed an affidavit. It is not clear whether it is an opposing or supporting affidavit. In it he avers that he renounced agency after being asked by Mrs Muir to hand over her files to some other legal practitioners. In paragraph 7 he asserts;

I have been prevailed upon by interested parties to the instant matter to act on behalf of the second respondent in the absence…,.

It is a telling assertion.

He filed the 'affidavit' without a mandate from Mrs Muir but did so due to some pressure from 'interested parties.'”

In the light of these facts, as emanating from the record, the finding that Mrs Muir was not before the court a quo is beyond impeachment.

Counsel for the appellants proceeded to argue that the finding by MAFUSIRE J, that there had in fact not been proper service of the application, was pertinent in this regard.

He contended that it could not be argued that the company and Mrs Muir could be said to have been in default, and, therefore, no order could be made against either of them.

These comments are made against the finding by the court a quo that Mrs Muir did not file an application for rescission, which finding has not been appealed against. The court stated:

In casu, Muir has not placed any facts before this Court, either in the application for rescission or in the present matter, that she was not served with the application. None of the witnesses, in the application for rescission, could testify on her behalf on that aspect.”

According to the learned authors, HERBSTEIN and Van WINSEN, The Civil Practice of the High Courts of South Africa, 5ed…, Rule 31(2)(b) of the Uniform Rules of the High Courts of South Africa provides that a defendant may, within twenty days after gaining knowledge of a default judgment granted against him, apply to court upon notice to the plaintiff to set aside the judgment.

I must say that I much prefer the wording in that rule to the one in our Rule 63.

The former is clear and admits of no doubt as to who should make the application. It is the defendant.

On p715, the learned authors state the following:

An applicant for the rescission of a default judgment must show good cause and prove that at no time did he renounce his defence, and has a serious intention of proceeding with the case. In order to show good cause, an applicant must give a reasonable explanation for the default, the application must be made bona fide and must show that a bona fide defence to the plaintiff's claim (exists).”

The contentions by counsel for the appellants, that Mrs Muir was not in default and was so found by MAFUSIRE J must, therefore, be considered in the light of the provisions of Rule 63 above.

The judgment of the learned judge in the court a quo is clear. As a consequence, when MAFUSIRE J found that the plaintiff had not been in wilful default such finding could only have related to the company. Mrs Muir never made an application for the rescission of the default judgment entered against her, and, as a consequence of such failure, the judgment, as it related to an order aimed at her personally, was not set aside. As a consequence, the setting aside of the order did not mean that she had purged her default. She had not sought an order permitting her to oppose the application filed against her.

According to the agreement of sale, the domicilium citandi et executandi was 98 Churchill Avenue. The return of service by the Deputy Sheriff stated that service had been effected at the domicilium citandi et executandi. The court a quo found that service had been effected because that is the address for service chosen by Mrs Muir in the agreement. The court stated:

It is trite that the return of service of an officer of the court, whether he be the Sheriff, the Deputy Sheriff or the Messenger, has to be accepted as prima facie proof of what was stated therein, capable of being rebutted by clear and satisfactory evidence. See Gundani v Kanyemba 1988 (1) ZLR 226 (SC).”

It is on record that she left Zimbabwe in September 2008. The documents were served in March 2008. She needed to explain why the return of service was not correct and why she had not seen the documents. There was no explanation from her. The return must therefore be accepted as correct.

In the absence of an application for rescission challenging such manner of service, a court hearing an application for rescission of a default judgment does not have the jurisdictional base to proceed and make conclusions touching on that process. It can only do so once good and sufficient cause has been established for the setting aside of the judgment. In this case there was none as related to Mrs Muir.

In the final analysis, the finding by the court a quo that the judgment against Mrs Muir was not set aside is unassailable. Grounds 1 and 2 of the appeal accordingly are without merit and must be dismissed.

Proof of Service, Return of Service, Address and Manner of Service re: Approach

This is an appeal against a judgment of the High Court handed down on 18 May 2016.

BACKGROUND FACTS

The facts which gave rise to this appeal are somewhat convoluted. Earthmoving & Construction Company (Private) Limited, the second appellant (hereinafter referred to as “the Company”), is a private limited company duly registered as such under the laws of Zimbabwe.

The Company had, at the time of incorporation, an authorized share capital of $32, divided into 32,000 ordinary shares with a nominal value of $0.001 each. Of those shares, only two had been issued. and were, at the time that these events evolved, owned by one Sandra Maureen Muir (“Mrs Muir”). This, in effect, gave 100 percent ownership of the issued shares to Mrs Muir.

In turn, the Company is the registered owner of an immovable piece of land, situate in Harare, identified as a certain piece of land situate in the district of SALISBURY TOWN LANDS measuring 3,066 square metres (also known as 98 Churchill Avenue, Gunhill, Harare). This property is the sole asset of the company.

On 27 May 2007, Mrs Muir concluded a written agreement of sale with Mr and Mrs Gurupira, in terms of which Mrs Muir sold to them the two shares in the Company. In terms of the agreement between the parties, the shares purchased by the Gurupiras' would entitle them to the “exclusive right of use and occupation” of the immovable property owned by the company. The purchase price for the shares was recorded as ZW$7,000,000,000= (seven billion dollars), payable as to a deposit of ZW$3,300,000= which was acknowledged as having been paid at the time of signing of the agreement. The balance of ZW$3,370,000,000= was to be paid within six (6) months from the date of the agreement. The rate at which the outstanding balance was to be paid as well as the frequency thereof were left to the discretion of the parties.

Although the purchase price was quoted in the local currency, it is common cause that the Gurupiras made sporadic payments sometimes in fuel, sometimes in US Dollars, and sometimes in Zimbabwe Dollars.

Up until the end of June 2007, the Gurupiras had made payment on eight occasions, with payment being made as described above. The total amount paid to Mrs Muir under this arrangement is in dispute between the parties.

On 4 August 2007, the Gurupiras addressed a letter to Mrs Muir indicating that they were encountering challenges raising the balance of the purchase price and sought an extension of the time to make payment but did not specify an exact date of expected payment. The last date for payment under the agreement was 25 November 2007.

A dispute ensued on the manner of payment, the currency of payment, and the place at which payment should be effected.

The Gurupiras alleged that at some point Mrs Muir started refusing payment in the local currency and demanded that the balance be paid in foreign currency. Mr Gurupira advised Mrs Muir that he could only pay foreign currency if he was able to access it and that he was not always in a position to obtain it. On 12 November 2007, Mr Gurupira instructed his legal practitioners to write to Mrs Muir to provide an account into which payment of the outstanding balance of the purchase price could be deposited. There was no response.

On 23 November 2007, the Gurupiras filed an application in the High Court seeking an order for Mrs Muir to provide a Bank account into which payment of the outstanding balance of the purchase price could be paid. In addition, they sought an order for specific performance by Mrs Muir for the transfer of shares in the company to themselves against a tender of payment of the balance of the purchase price.

This application never saw the light of day having been withdrawn before it could be set down.

The record shows that on 6 September 2007, the Gurupiras made a payment through wire transfer directly to Israel where Mrs Muir was now residing. Also on record is a cheque payment, in February 2008, into a Standard Chartered Bank account bearing Mrs Muir's name.

It is common cause that during the period following the filing of the above mentioned application Mrs Muir concluded a series of agreements with the first appellant, (“Leggett”).

On 11 December 2007, Mrs Muir and Leggett concluded an agreement in terms of which the latter would subscribe to 98 ordinary shares in the company. Subsequently, on 27 May 2008, Leggett concluded an agreement with Mrs Muir in terms of which the former purchased the entire shareholding in the company from Mrs Muir. Just as in the case of the Gurupiras, the purchase entitled him to “exclusive use and occupation” of the immovable property which is the subject matter of this appeal.

Subsequent to the conclusion of the first agreement, the Gurupiras became aware that Mrs Muir had placed advertisements for the sale of the immovable property. As a consequence, on 7 March 2008, under Case No. HC1393/08, the Gurupiras filed an application with the High Court in which they sought, variously, as against the company, interlocutory relief prohibiting the transfer of the immovable property, and, as against Mrs Muir, an order for specific performance in respect of the immovable property. The Registrar of Deeds, the Sheriff for Zimbabwe and his Deputy were also cited as third, fourth and fifth respondents respectively.

On 21 May 2018, the High Court granted an order in favour of the Gurupiras, in default of appearance from Mrs Muir and the company, as claimed in the draft order.

On 16 June 2008 the property was transferred to the Gurupiras under Deed of Transfer No. 4778/08. They proceeded to evict the occupant, one Diniwe Chinyani. She informed Leggett.

An urgent application for rescission of the default judgment was filed on behalf of the company. It was adjudged not urgent and was finally set down for hearing as an opposed matter. However, the matter was referred to trial on the premise that there existed material disputes of fact.

Pending the determination of the application for rescission, the company filed a counter application in which it sought an order for the eviction of the Gurupiras on the premise that it was the owner of the property in question.

On 19 March 2014, after a full trial, the High Court gave an order in terms of which the default judgment was set aside with leave being granted for “the respondent” in the main application to file opposing papers.

The main application was heard by the High Court on 21 May and 18 June 2015. By this time, pursuant to an application by the Gurupiras, Leggett had been joined as sixth respondent by order of the court. An issue arose as to whether Mrs Muir was before the court. The Gurupiras argued that she had not applied for the rescission of the default judgment in the sense that only the company had sought such rescission. It also transpired that Mr Stevenson, who purported to represent her on the day of the hearing, had not filed papers on her behalf nor did he appear to have the mandate to represent her.

On 18 May 2016 the High Court handed down its judgment and issued an order:

1. Declaring that the Gurupiras to be the lawful shareholders of the entire shareholding in the first respondent (the company) and that any purported transfer or appointment of directors by the sixth respondent (Leggett) be deemed to be null and void. (sic)

2. Directing the second respondent to sign all necessary documents to effect transfer of the above-mentioned shares. (sic)

3. That should the second respondent fail to sign the necessary documents to effect transfer of the shares, the Sheriff of the High Court be directed to sign all necessary documents to effect transfer of the shares to the Gurupiras.

4. The first and sixth respondents shall bear the costs of this application on an attorney and client scale jointly and severally each causing the other to be absolved. (sic)

5. Dismissing the sixth respondent's counter-application.

It is this decision that Leggett has brought on appeal...,.

ISSUES FOR DETERMINATION ON APPEAL

Although the Gurupiras obtained an order for specific performance against Mrs Muir, which is the main issue in contention in this appeal, the starting point revolves around the issue of rescission of the default judgment of 21 May 2018.

1. In this appeal, the court has to determine the effect of the order for rescission given by MAFUSIRE J.

2. Consequent thereto is the issue as to whether Mrs Muir, following upon the rescission of the default judgment, was before the court a quo for the determination of the main application.

3. Additionally, there should be a determination as to whether the court a quo was correct in finding that the Gurupiras were entitled to specific performance. For the proper determination of this aspect on the merits, it stands to reason that Leggett and the company could only appeal if Mrs Muir was a party to the proceedings. Her absence militates against their contentions in that regard.

4. Lastly, the court had to decide whether Leggett was entitled to relief in respect of the shareholding transferred to him by Mrs Muir.

Given the issues raised in the rather extensive grounds, I have decided to deal with each ground of appeal separately ad seriatim.

AD GROUNDS 1 and 2 - WHETHER THE COURT A QUO ERRED IN FINDING THAT MUIR HAD BEEN PROPERLY SERVED, THAT, AS A CONSEQUENCE, MUIR WAS NOT BEFORE THE COURT AND HAD FAILED TO OPPOSE THE APPLICATION FOR SPECIFIC PERFORMANCE

These two grounds are interlinked as they are concerned with the same issue.

The application for the rescission of the default judgment was the sine qua non for any party seeking to oppose relief being claimed by the Gurupiras to have the leave of court to appear in opposition to such application.

As regards this issue, it was contended that the High Court had said that the issue was whether or not Mrs Muir was before the court. It was contended that due to the findings of fact made by MAFUSIRE J the court had to find that the judgment had been rescinded, thus affording her a right to oppose the relief sought by the Gurupiras.

Per contra, counsel for the respondents submitted that Mrs Muir had not appealed against the finding that she was not before the High Court. As a consequence, there was no opposition filed by her to the order sought by the Gurupiras.

The court a quo made the following critical findings;

It found that Mrs Muir had been properly served with the application. Further to that, it found that due to her failure to have the judgment granted in default rescinded as against her, she was not before the court.

The application for rescission was, on the order of the High Court, converted to a trial given the seeming myriad material disputes of fact on the papers. The witnesses called included Leggett, one Diniwe Chinyanga, L. T Nhari, a forensic documents examiner, and Thomas David Stevenson.

The last witness was appearing in his capacity as the legal practitioner of record for Mrs Muir.

Mrs Muir, however, did not launch an application for the rescission of the order made against her nor was she one of the witnesses who gave evidence before the High Court in support of the application for rescission of the default judgment.

Counsel for the appellants, Leggett and the company, submitted that the court a quo should have had regard to the evidence given to the court during the trial wherein the rescission of the default judgment was being considered.

It is pertinent to note that when the matter was heard by MAFUSIRE J, on 10 and 11 February 2014, there was only one party referred to as the plaintiff - and that was the company. Mrs Muir was cited as the third respondent in that matter. This is because the company had made the application for rescission. It cited Mrs Muir as a respondent. She did not file any papers. The judgment reflects that there was no appearance by Mrs Muir. The learned judge found that there had been no proper service of the application to compel specific performance as against Mrs Muir. He found, as a consequence, that there had not been proper service on Mrs Muir.

The critical question that begs an answer is what was before his Lordship. In other words, was Mrs Muir before his Lordship in an application for the setting aside of a judgment granted in default?

Such an application is governed by Rule 63 of the Rules of the High Court, 1971. Rule 63 is couched as follows:

(1) A party against whom judgment has been given in default, whether under these rules or under any other law, may make a court application, not later than one month after he has had knowledge of the judgment, for the judgment to be set aside.

(2) If the court is satisfied, on an application in terms of sub-rule (1), that there is good and sufficient cause to do so, the court may set aside the judgment concerned and give leave to the defendant to defend or to the plaintiff to prosecute his action on such terms as to costs and otherwise as the court considers just.

(3) Unless an applicant for the setting aside of a judgment in terms of this Rule proves to the contrary, he shall be presumed to have had knowledge of the judgment within two days after the date thereof.”

In my view, it was incumbent upon Mrs Muir, in the pursuit of the protection of her rights under the agreement with the Gurupiras, to apply, in terms of Rule 63, to have the judgment against her rescinded or set aside.

Even the order issued by MAFUSIRE J is of no assistance to her cause. It orders that “the plaintiff shall file its notice of opposition within ten days of the date of the order” - and it is common cause that the plaintiff in those proceedings was the company.

Notwithstanding his remarks on service, there is no order granting leave to Mrs Muir to file opposing papers. This is due to her absence from the proceedings from the beginning.

The court a quo found that, despite the presence of Mr Stevenson, who purported to act on her behalf, Mrs Muir was not before it. The court said:

It is trite that where the Notice of Opposition or affidavit is to be signed by a person other than the respondent, that person must show that he is authorised to do so. The authors Herbestein & Van Winsen - The Civil Practice of the High Courts of South Africa, 5th Ed, p437 put it this way;

'Where an application is made by an agent on behalf of a principal, an averment of the agent's authority is essential, unless it appears from the affidavits filed in the application that the principal is aware of and ratified the proceedings. A statement that the applicant is acting in the capacity of agent for the principal in question is a sufficient allegation of authority to make the application.'”

In casu, Mr Stevenson filed an affidavit. It is not clear whether it is an opposing or supporting affidavit. In it he avers that he renounced agency after being asked by Mrs Muir to hand over her files to some other legal practitioners. In paragraph 7 he asserts;

I have been prevailed upon by interested parties to the instant matter to act on behalf of the second respondent in the absence…,.

It is a telling assertion.

He filed the 'affidavit' without a mandate from Mrs Muir but did so due to some pressure from 'interested parties.'”

In the light of these facts, as emanating from the record, the finding that Mrs Muir was not before the court a quo is beyond impeachment.

Counsel for the appellants proceeded to argue that the finding by MAFUSIRE J, that there had in fact not been proper service of the application, was pertinent in this regard.

He contended that it could not be argued that the company and Mrs Muir could be said to have been in default, and, therefore, no order could be made against either of them.

These comments are made against the finding by the court a quo that Mrs Muir did not file an application for rescission, which finding has not been appealed against. The court stated:

In casu, Muir has not placed any facts before this Court, either in the application for rescission or in the present matter, that she was not served with the application. None of the witnesses, in the application for rescission, could testify on her behalf on that aspect.”

According to the learned authors, HERBSTEIN and Van WINSEN, The Civil Practice of the High Courts of South Africa, 5ed…, Rule 31(2)(b) of the Uniform Rules of the High Courts of South Africa provides that a defendant may, within twenty days after gaining knowledge of a default judgment granted against him, apply to court upon notice to the plaintiff to set aside the judgment.

I must say that I much prefer the wording in that rule to the one in our Rule 63.

The former is clear and admits of no doubt as to who should make the application. It is the defendant.

On p715, the learned authors state the following:

An applicant for the rescission of a default judgment must show good cause and prove that at no time did he renounce his defence, and has a serious intention of proceeding with the case. In order to show good cause, an applicant must give a reasonable explanation for the default, the application must be made bona fide and must show that a bona fide defence to the plaintiff's claim (exists).”

The contentions by counsel for the appellants, that Mrs Muir was not in default and was so found by MAFUSIRE J must, therefore, be considered in the light of the provisions of Rule 63 above.

The judgment of the learned judge in the court a quo is clear. As a consequence, when MAFUSIRE J found that the plaintiff had not been in wilful default such finding could only have related to the company. Mrs Muir never made an application for the rescission of the default judgment entered against her, and, as a consequence of such failure, the judgment, as it related to an order aimed at her personally, was not set aside. As a consequence, the setting aside of the order did not mean that she had purged her default. She had not sought an order permitting her to oppose the application filed against her.

According to the agreement of sale, the domicilium citandi et executandi was 98 Churchill Avenue. The return of service by the Deputy Sheriff stated that service had been effected at the domicilium citandi et executandi. The court a quo found that service had been effected because that is the address for service chosen by Mrs Muir in the agreement. The court stated:

It is trite that the return of service of an officer of the court, whether he be the Sheriff, the Deputy Sheriff or the Messenger, has to be accepted as prima facie proof of what was stated therein, capable of being rebutted by clear and satisfactory evidence. See Gundani v Kanyemba 1988 (1) ZLR 226 (SC).”

It is on record that she left Zimbabwe in September 2008. The documents were served in March 2008. She needed to explain why the return of service was not correct and why she had not seen the documents. There was no explanation from her. The return must therefore be accepted as correct.

In the absence of an application for rescission challenging such manner of service, a court hearing an application for rescission of a default judgment does not have the jurisdictional base to proceed and make conclusions touching on that process. It can only do so once good and sufficient cause has been established for the setting aside of the judgment. In this case there was none as related to Mrs Muir.

In the final analysis, the finding by the court a quo that the judgment against Mrs Muir was not set aside is unassailable. Grounds 1 and 2 of the appeal accordingly are without merit and must be dismissed.

Proof of Service, Return of Service, Address and Manner of Service re: Contractual Service and the Domicilium Citandi

This is an appeal against a judgment of the High Court handed down on 18 May 2016.

BACKGROUND FACTS

The facts which gave rise to this appeal are somewhat convoluted. Earthmoving & Construction Company (Private) Limited, the second appellant (hereinafter referred to as “the Company”), is a private limited company duly registered as such under the laws of Zimbabwe.

The Company had, at the time of incorporation, an authorized share capital of $32, divided into 32,000 ordinary shares with a nominal value of $0.001 each. Of those shares, only two had been issued. and were, at the time that these events evolved, owned by one Sandra Maureen Muir (“Mrs Muir”). This, in effect, gave 100 percent ownership of the issued shares to Mrs Muir.

In turn, the Company is the registered owner of an immovable piece of land, situate in Harare, identified as a certain piece of land situate in the district of SALISBURY TOWN LANDS measuring 3,066 square metres (also known as 98 Churchill Avenue, Gunhill, Harare). This property is the sole asset of the company.

On 27 May 2007, Mrs Muir concluded a written agreement of sale with Mr and Mrs Gurupira, in terms of which Mrs Muir sold to them the two shares in the Company. In terms of the agreement between the parties, the shares purchased by the Gurupiras' would entitle them to the “exclusive right of use and occupation” of the immovable property owned by the company. The purchase price for the shares was recorded as ZW$7,000,000,000= (seven billion dollars), payable as to a deposit of ZW$3,300,000= which was acknowledged as having been paid at the time of signing of the agreement. The balance of ZW$3,370,000,000= was to be paid within six (6) months from the date of the agreement. The rate at which the outstanding balance was to be paid as well as the frequency thereof were left to the discretion of the parties.

Although the purchase price was quoted in the local currency, it is common cause that the Gurupiras made sporadic payments sometimes in fuel, sometimes in US Dollars, and sometimes in Zimbabwe Dollars.

Up until the end of June 2007, the Gurupiras had made payment on eight occasions, with payment being made as described above. The total amount paid to Mrs Muir under this arrangement is in dispute between the parties.

On 4 August 2007, the Gurupiras addressed a letter to Mrs Muir indicating that they were encountering challenges raising the balance of the purchase price and sought an extension of the time to make payment but did not specify an exact date of expected payment. The last date for payment under the agreement was 25 November 2007.

A dispute ensued on the manner of payment, the currency of payment, and the place at which payment should be effected.

The Gurupiras alleged that at some point Mrs Muir started refusing payment in the local currency and demanded that the balance be paid in foreign currency. Mr Gurupira advised Mrs Muir that he could only pay foreign currency if he was able to access it and that he was not always in a position to obtain it. On 12 November 2007, Mr Gurupira instructed his legal practitioners to write to Mrs Muir to provide an account into which payment of the outstanding balance of the purchase price could be deposited. There was no response.

On 23 November 2007, the Gurupiras filed an application in the High Court seeking an order for Mrs Muir to provide a Bank account into which payment of the outstanding balance of the purchase price could be paid. In addition, they sought an order for specific performance by Mrs Muir for the transfer of shares in the company to themselves against a tender of payment of the balance of the purchase price.

This application never saw the light of day having been withdrawn before it could be set down.

The record shows that on 6 September 2007, the Gurupiras made a payment through wire transfer directly to Israel where Mrs Muir was now residing. Also on record is a cheque payment, in February 2008, into a Standard Chartered Bank account bearing Mrs Muir's name.

It is common cause that during the period following the filing of the above mentioned application Mrs Muir concluded a series of agreements with the first appellant, (“Leggett”).

On 11 December 2007, Mrs Muir and Leggett concluded an agreement in terms of which the latter would subscribe to 98 ordinary shares in the company. Subsequently, on 27 May 2008, Leggett concluded an agreement with Mrs Muir in terms of which the former purchased the entire shareholding in the company from Mrs Muir. Just as in the case of the Gurupiras, the purchase entitled him to “exclusive use and occupation” of the immovable property which is the subject matter of this appeal.

Subsequent to the conclusion of the first agreement, the Gurupiras became aware that Mrs Muir had placed advertisements for the sale of the immovable property. As a consequence, on 7 March 2008, under Case No. HC1393/08, the Gurupiras filed an application with the High Court in which they sought, variously, as against the company, interlocutory relief prohibiting the transfer of the immovable property, and, as against Mrs Muir, an order for specific performance in respect of the immovable property. The Registrar of Deeds, the Sheriff for Zimbabwe and his Deputy were also cited as third, fourth and fifth respondents respectively.

On 21 May 2018, the High Court granted an order in favour of the Gurupiras, in default of appearance from Mrs Muir and the company, as claimed in the draft order.

On 16 June 2008 the property was transferred to the Gurupiras under Deed of Transfer No. 4778/08. They proceeded to evict the occupant, one Diniwe Chinyani. She informed Leggett.

An urgent application for rescission of the default judgment was filed on behalf of the company. It was adjudged not urgent and was finally set down for hearing as an opposed matter. However, the matter was referred to trial on the premise that there existed material disputes of fact.

Pending the determination of the application for rescission, the company filed a counter application in which it sought an order for the eviction of the Gurupiras on the premise that it was the owner of the property in question.

On 19 March 2014, after a full trial, the High Court gave an order in terms of which the default judgment was set aside with leave being granted for “the respondent” in the main application to file opposing papers.

The main application was heard by the High Court on 21 May and 18 June 2015. By this time, pursuant to an application by the Gurupiras, Leggett had been joined as sixth respondent by order of the court. An issue arose as to whether Mrs Muir was before the court. The Gurupiras argued that she had not applied for the rescission of the default judgment in the sense that only the company had sought such rescission. It also transpired that Mr Stevenson, who purported to represent her on the day of the hearing, had not filed papers on her behalf nor did he appear to have the mandate to represent her.

On 18 May 2016 the High Court handed down its judgment and issued an order:

1. Declaring that the Gurupiras to be the lawful shareholders of the entire shareholding in the first respondent (the company) and that any purported transfer or appointment of directors by the sixth respondent (Leggett) be deemed to be null and void. (sic)

2. Directing the second respondent to sign all necessary documents to effect transfer of the above-mentioned shares. (sic)

3. That should the second respondent fail to sign the necessary documents to effect transfer of the shares, the Sheriff of the High Court be directed to sign all necessary documents to effect transfer of the shares to the Gurupiras.

4. The first and sixth respondents shall bear the costs of this application on an attorney and client scale jointly and severally each causing the other to be absolved. (sic)

5. Dismissing the sixth respondent's counter-application.

It is this decision that Leggett has brought on appeal...,.

ISSUES FOR DETERMINATION ON APPEAL

Although the Gurupiras obtained an order for specific performance against Mrs Muir, which is the main issue in contention in this appeal, the starting point revolves around the issue of rescission of the default judgment of 21 May 2018.

1. In this appeal, the court has to determine the effect of the order for rescission given by MAFUSIRE J.

2. Consequent thereto is the issue as to whether Mrs Muir, following upon the rescission of the default judgment, was before the court a quo for the determination of the main application.

3. Additionally, there should be a determination as to whether the court a quo was correct in finding that the Gurupiras were entitled to specific performance. For the proper determination of this aspect on the merits, it stands to reason that Leggett and the company could only appeal if Mrs Muir was a party to the proceedings. Her absence militates against their contentions in that regard.

4. Lastly, the court had to decide whether Leggett was entitled to relief in respect of the shareholding transferred to him by Mrs Muir.

Given the issues raised in the rather extensive grounds, I have decided to deal with each ground of appeal separately ad seriatim.

AD GROUNDS 1 and 2 - WHETHER THE COURT A QUO ERRED IN FINDING THAT MUIR HAD BEEN PROPERLY SERVED, THAT, AS A CONSEQUENCE, MUIR WAS NOT BEFORE THE COURT AND HAD FAILED TO OPPOSE THE APPLICATION FOR SPECIFIC PERFORMANCE

These two grounds are interlinked as they are concerned with the same issue.

The application for the rescission of the default judgment was the sine qua non for any party seeking to oppose relief being claimed by the Gurupiras to have the leave of court to appear in opposition to such application.

As regards this issue, it was contended that the High Court had said that the issue was whether or not Mrs Muir was before the court. It was contended that due to the findings of fact made by MAFUSIRE J the court had to find that the judgment had been rescinded, thus affording her a right to oppose the relief sought by the Gurupiras.

Per contra, counsel for the respondents submitted that Mrs Muir had not appealed against the finding that she was not before the High Court. As a consequence, there was no opposition filed by her to the order sought by the Gurupiras.

The court a quo made the following critical findings;

It found that Mrs Muir had been properly served with the application. Further to that, it found that due to her failure to have the judgment granted in default rescinded as against her, she was not before the court.

The application for rescission was, on the order of the High Court, converted to a trial given the seeming myriad material disputes of fact on the papers. The witnesses called included Leggett, one Diniwe Chinyanga, L. T Nhari, a forensic documents examiner, and Thomas David Stevenson.

The last witness was appearing in his capacity as the legal practitioner of record for Mrs Muir.

Mrs Muir, however, did not launch an application for the rescission of the order made against her nor was she one of the witnesses who gave evidence before the High Court in support of the application for rescission of the default judgment.

Counsel for the appellants, Leggett and the company, submitted that the court a quo should have had regard to the evidence given to the court during the trial wherein the rescission of the default judgment was being considered.

It is pertinent to note that when the matter was heard by MAFUSIRE J, on 10 and 11 February 2014, there was only one party referred to as the plaintiff - and that was the company. Mrs Muir was cited as the third respondent in that matter. This is because the company had made the application for rescission. It cited Mrs Muir as a respondent. She did not file any papers. The judgment reflects that there was no appearance by Mrs Muir. The learned judge found that there had been no proper service of the application to compel specific performance as against Mrs Muir. He found, as a consequence, that there had not been proper service on Mrs Muir.

The critical question that begs an answer is what was before his Lordship. In other words, was Mrs Muir before his Lordship in an application for the setting aside of a judgment granted in default?

Such an application is governed by Rule 63 of the Rules of the High Court, 1971. Rule 63 is couched as follows:

(1) A party against whom judgment has been given in default, whether under these rules or under any other law, may make a court application, not later than one month after he has had knowledge of the judgment, for the judgment to be set aside.

(2) If the court is satisfied, on an application in terms of sub-rule (1), that there is good and sufficient cause to do so, the court may set aside the judgment concerned and give leave to the defendant to defend or to the plaintiff to prosecute his action on such terms as to costs and otherwise as the court considers just.

(3) Unless an applicant for the setting aside of a judgment in terms of this Rule proves to the contrary, he shall be presumed to have had knowledge of the judgment within two days after the date thereof.”

In my view, it was incumbent upon Mrs Muir, in the pursuit of the protection of her rights under the agreement with the Gurupiras, to apply, in terms of Rule 63, to have the judgment against her rescinded or set aside.

Even the order issued by MAFUSIRE J is of no assistance to her cause. It orders that “the plaintiff shall file its notice of opposition within ten days of the date of the order” - and it is common cause that the plaintiff in those proceedings was the company.

Notwithstanding his remarks on service, there is no order granting leave to Mrs Muir to file opposing papers. This is due to her absence from the proceedings from the beginning.

The court a quo found that, despite the presence of Mr Stevenson, who purported to act on her behalf, Mrs Muir was not before it. The court said:

It is trite that where the Notice of Opposition or affidavit is to be signed by a person other than the respondent, that person must show that he is authorised to do so. The authors Herbestein & Van Winsen - The Civil Practice of the High Courts of South Africa, 5th Ed, p437 put it this way;

'Where an application is made by an agent on behalf of a principal, an averment of the agent's authority is essential, unless it appears from the affidavits filed in the application that the principal is aware of and ratified the proceedings. A statement that the applicant is acting in the capacity of agent for the principal in question is a sufficient allegation of authority to make the application.'”

In casu, Mr Stevenson filed an affidavit. It is not clear whether it is an opposing or supporting affidavit. In it he avers that he renounced agency after being asked by Mrs Muir to hand over her files to some other legal practitioners. In paragraph 7 he asserts;

I have been prevailed upon by interested parties to the instant matter to act on behalf of the second respondent in the absence…,.

It is a telling assertion.

He filed the 'affidavit' without a mandate from Mrs Muir but did so due to some pressure from 'interested parties.'”

In the light of these facts, as emanating from the record, the finding that Mrs Muir was not before the court a quo is beyond impeachment.

Counsel for the appellants proceeded to argue that the finding by MAFUSIRE J, that there had in fact not been proper service of the application, was pertinent in this regard.

He contended that it could not be argued that the company and Mrs Muir could be said to have been in default, and, therefore, no order could be made against either of them.

These comments are made against the finding by the court a quo that Mrs Muir did not file an application for rescission, which finding has not been appealed against. The court stated:

In casu, Muir has not placed any facts before this Court, either in the application for rescission or in the present matter, that she was not served with the application. None of the witnesses, in the application for rescission, could testify on her behalf on that aspect.”

According to the learned authors, HERBSTEIN and Van WINSEN, The Civil Practice of the High Courts of South Africa, 5ed…, Rule 31(2)(b) of the Uniform Rules of the High Courts of South Africa provides that a defendant may, within twenty days after gaining knowledge of a default judgment granted against him, apply to court upon notice to the plaintiff to set aside the judgment.

I must say that I much prefer the wording in that rule to the one in our Rule 63.

The former is clear and admits of no doubt as to who should make the application. It is the defendant.

On p715, the learned authors state the following:

An applicant for the rescission of a default judgment must show good cause and prove that at no time did he renounce his defence, and has a serious intention of proceeding with the case. In order to show good cause, an applicant must give a reasonable explanation for the default, the application must be made bona fide and must show that a bona fide defence to the plaintiff's claim (exists).”

The contentions by counsel for the appellants, that Mrs Muir was not in default and was so found by MAFUSIRE J must, therefore, be considered in the light of the provisions of Rule 63 above.

The judgment of the learned judge in the court a quo is clear. As a consequence, when MAFUSIRE J found that the plaintiff had not been in wilful default such finding could only have related to the company. Mrs Muir never made an application for the rescission of the default judgment entered against her, and, as a consequence of such failure, the judgment, as it related to an order aimed at her personally, was not set aside. As a consequence, the setting aside of the order did not mean that she had purged her default. She had not sought an order permitting her to oppose the application filed against her.

According to the agreement of sale, the domicilium citandi et executandi was 98 Churchill Avenue. The return of service by the Deputy Sheriff stated that service had been effected at the domicilium citandi et executandi. The court a quo found that service had been effected because that is the address for service chosen by Mrs Muir in the agreement. The court stated:

It is trite that the return of service of an officer of the court, whether he be the Sheriff, the Deputy Sheriff or the Messenger, has to be accepted as prima facie proof of what was stated therein, capable of being rebutted by clear and satisfactory evidence. See Gundani v Kanyemba 1988 (1) ZLR 226 (SC).”

It is on record that she left Zimbabwe in September 2008. The documents were served in March 2008. She needed to explain why the return of service was not correct and why she had not seen the documents. There was no explanation from her. The return must therefore be accepted as correct.

In the absence of an application for rescission challenging such manner of service, a court hearing an application for rescission of a default judgment does not have the jurisdictional base to proceed and make conclusions touching on that process. It can only do so once good and sufficient cause has been established for the setting aside of the judgment. In this case there was none as related to Mrs Muir.

In the final analysis, the finding by the court a quo that the judgment against Mrs Muir was not set aside is unassailable. Grounds 1 and 2 of the appeal accordingly are without merit and must be dismissed.

Passing of Ownership, Proof of Title and Jus in re Propria re: Implied Lawful Right of Ownership

This is an appeal against a judgment of the High Court handed down on 18 May 2016.

BACKGROUND FACTS

The facts which gave rise to this appeal are somewhat convoluted. Earthmoving & Construction Company (Private) Limited, the second appellant (hereinafter referred to as “the Company”), is a private limited company duly registered as such under the laws of Zimbabwe.

The Company had, at the time of incorporation, an authorized share capital of $32, divided into 32,000 ordinary shares with a nominal value of $0.001 each. Of those shares, only two had been issued. and were, at the time that these events evolved, owned by one Sandra Maureen Muir (“Mrs Muir”). This, in effect, gave 100 percent ownership of the issued shares to Mrs Muir.

In turn, the Company is the registered owner of an immovable piece of land, situate in Harare, identified as a certain piece of land situate in the district of SALISBURY TOWN LANDS measuring 3,066 square metres (also known as 98 Churchill Avenue, Gunhill, Harare). This property is the sole asset of the company.

On 27 May 2007, Mrs Muir concluded a written agreement of sale with Mr and Mrs Gurupira, in terms of which Mrs Muir sold to them the two shares in the Company. In terms of the agreement between the parties, the shares purchased by the Gurupiras' would entitle them to the “exclusive right of use and occupation” of the immovable property owned by the company. The purchase price for the shares was recorded as ZW$7,000,000,000= (seven billion dollars), payable as to a deposit of ZW$3,300,000= which was acknowledged as having been paid at the time of signing of the agreement. The balance of ZW$3,370,000,000= was to be paid within six (6) months from the date of the agreement. The rate at which the outstanding balance was to be paid as well as the frequency thereof were left to the discretion of the parties.

Although the purchase price was quoted in the local currency, it is common cause that the Gurupiras made sporadic payments sometimes in fuel, sometimes in US Dollars, and sometimes in Zimbabwe Dollars.

Up until the end of June 2007, the Gurupiras had made payment on eight occasions, with payment being made as described above. The total amount paid to Mrs Muir under this arrangement is in dispute between the parties.

On 4 August 2007, the Gurupiras addressed a letter to Mrs Muir indicating that they were encountering challenges raising the balance of the purchase price and sought an extension of the time to make payment but did not specify an exact date of expected payment. The last date for payment under the agreement was 25 November 2007.

A dispute ensued on the manner of payment, the currency of payment, and the place at which payment should be effected.

The Gurupiras alleged that at some point Mrs Muir started refusing payment in the local currency and demanded that the balance be paid in foreign currency. Mr Gurupira advised Mrs Muir that he could only pay foreign currency if he was able to access it and that he was not always in a position to obtain it. On 12 November 2007, Mr Gurupira instructed his legal practitioners to write to Mrs Muir to provide an account into which payment of the outstanding balance of the purchase price could be deposited. There was no response.

On 23 November 2007, the Gurupiras filed an application in the High Court seeking an order for Mrs Muir to provide a Bank account into which payment of the outstanding balance of the purchase price could be paid. In addition, they sought an order for specific performance by Mrs Muir for the transfer of shares in the company to themselves against a tender of payment of the balance of the purchase price.

This application never saw the light of day having been withdrawn before it could be set down.

The record shows that on 6 September 2007, the Gurupiras made a payment through wire transfer directly to Israel where Mrs Muir was now residing. Also on record is a cheque payment, in February 2008, into a Standard Chartered Bank account bearing Mrs Muir's name.

It is common cause that during the period following the filing of the above mentioned application Mrs Muir concluded a series of agreements with the first appellant, (“Leggett”).

On 11 December 2007, Mrs Muir and Leggett concluded an agreement in terms of which the latter would subscribe to 98 ordinary shares in the company. Subsequently, on 27 May 2008, Leggett concluded an agreement with Mrs Muir in terms of which the former purchased the entire shareholding in the company from Mrs Muir. Just as in the case of the Gurupiras, the purchase entitled him to “exclusive use and occupation” of the immovable property which is the subject matter of this appeal.

Subsequent to the conclusion of the first agreement, the Gurupiras became aware that Mrs Muir had placed advertisements for the sale of the immovable property. As a consequence, on 7 March 2008, under Case No. HC1393/08, the Gurupiras filed an application with the High Court in which they sought, variously, as against the company, interlocutory relief prohibiting the transfer of the immovable property, and, as against Mrs Muir, an order for specific performance in respect of the immovable property. The Registrar of Deeds, the Sheriff for Zimbabwe and his Deputy were also cited as third, fourth and fifth respondents respectively.

On 21 May 2018, the High Court granted an order in favour of the Gurupiras, in default of appearance from Mrs Muir and the company, as claimed in the draft order.

On 16 June 2008 the property was transferred to the Gurupiras under Deed of Transfer No. 4778/08. They proceeded to evict the occupant, one Diniwe Chinyani. She informed Leggett.

An urgent application for rescission of the default judgment was filed on behalf of the company. It was adjudged not urgent and was finally set down for hearing as an opposed matter. However, the matter was referred to trial on the premise that there existed material disputes of fact.

Pending the determination of the application for rescission, the company filed a counter application in which it sought an order for the eviction of the Gurupiras on the premise that it was the owner of the property in question.

On 19 March 2014, after a full trial, the High Court gave an order in terms of which the default judgment was set aside with leave being granted for “the respondent” in the main application to file opposing papers.

The main application was heard by the High Court on 21 May and 18 June 2015. By this time, pursuant to an application by the Gurupiras, Leggett had been joined as sixth respondent by order of the court. An issue arose as to whether Mrs Muir was before the court. The Gurupiras argued that she had not applied for the rescission of the default judgment in the sense that only the company had sought such rescission. It also transpired that Mr Stevenson, who purported to represent her on the day of the hearing, had not filed papers on her behalf nor did he appear to have the mandate to represent her.

On 18 May 2016 the High Court handed down its judgment and issued an order:

1. Declaring that the Gurupiras to be the lawful shareholders of the entire shareholding in the first respondent (the company) and that any purported transfer or appointment of directors by the sixth respondent (Leggett) be deemed to be null and void. (sic)

2. Directing the second respondent to sign all necessary documents to effect transfer of the above-mentioned shares. (sic)

3. That should the second respondent fail to sign the necessary documents to effect transfer of the shares, the Sheriff of the High Court be directed to sign all necessary documents to effect transfer of the shares to the Gurupiras.

4. The first and sixth respondents shall bear the costs of this application on an attorney and client scale jointly and severally each causing the other to be absolved. (sic)

5. Dismissing the sixth respondent's counter-application.

It is this decision that Leggett has brought on appeal...,. 

ISSUES FOR DETERMINATION ON APPEAL

Although the Gurupiras obtained an order for specific performance against Mrs Muir, which is the main issue in contention in this appeal, the starting point revolves around the issue of rescission of the default judgment of 21 May 2018.

1. In this appeal, the court has to determine the effect of the order for rescission given by MAFUSIRE J.

2. Consequent thereto is the issue as to whether Mrs Muir, following upon the rescission of the default judgment, was before the court a quo for the determination of the main application.

3. Additionally, there should be a determination as to whether the court a quo was correct in finding that the Gurupiras were entitled to specific performance. For the proper determination of this aspect on the merits, it stands to reason that Leggett and the company could only appeal if Mrs Muir was a party to the proceedings. Her absence militates against their contentions in that regard.

4. Lastly, the court had to decide whether Leggett was entitled to relief in respect of the shareholding transferred to him by Mrs Muir....,.

AD GROUND 3 - WHETHER THE COURT A QUO ERRED IN FINDING THAT THE GURUPIRAS HAD ESTABLISHED AN ENTITLEMENT TO THE TRANSFER OF SHARES

Counsel for the appellants contended that the Gurupiras had not established an entitlement to the transfer of shares in their names.

In my view, this submission could only be made on behalf of Mrs Muir and not the two appellants.

Although Mrs Muir was adjudged not to be before the court a quo, a critical examination of the submissions, both in the High Court and this Court, will tend to show that almost all the points being raised related to Mrs Muir and her relationship with the Gurupiras. I can only say that this is an unfortunate development in the sense that, whatever the relationship between Leggett and Mrs Muir was, it was clear on the papers that counsel for the appellants appeared on behalf of the two appellants, Leggget and the company - and not Mrs Muir.

Leggett was not, and could not claim to be privy to the transaction between Mrs Muir and the Gurupiras. He concedes as much in all the affidavits deposed to by him. On that score, he is not in a position, nor would I find that he was, authorized to speak to it.

When the High Court granted the application for rescission of the default judgment, it set aside the interdict and the order for the transfer of the property to the Gurupiras. The learned judge however also ordered that the following pertinent issues be determined in the main application:

3. The following residual issues shall be determined in the main application in HC1393/08:

3.1 Whether or not the agreement of sale between the first and second defendants, namely, Asswell Africa Gurupira, of the one part, and the third defendant, namely, Sandra Maureen Muir, of the other part was duly performed;

3.2 Whether or not the transfer of shares in the plaintiff company (Private) Limited, by the third defendant to one John Leggett, should be set aside;

3.3 Whether or not the first and second defendants should vacate the premises situate on the property more fully described in paragraph 2 above and which is also known as 98 Churchill Avenue, Gunhill, Harare;

4 The plaintiff shall file its notice of opposition or other such papers in HC1393/08 within ten (10) days of the date of this order and thereafter the filing of any further documents shall be in accordance with the Rules.”

Pursuant to this, on 2 November 2009, the Gurupiras filed a counterclaim in which they sought an order for the setting aside of the transfer of shares in the company from Mrs Muir to Leggett. Concomitant with that prayer was a prayer for the transfer of those shares to the Gurupiras.

I note that at the commencement of the hearing in the court a quo counsel for the respondents moved an application for the amendment of the draft order on behalf of the Gurupiras.

The court a quo recorded that the application was granted with the consent of both counsel for the appellants and Stevenson. This is what the court said:

On the day of hearing, Mr Mpofu moved for the amendment of the Draft Order. Both Mr de Bourbon and Mr Stevenson did not oppose the amendment. It was therefore granted.”

The granting of the application to amend the draft order disposed of the point taken by the company and Leggett regarding the competency of the order sought by the Gurupiras.

The coming into the picture of Leggett did not, in my view, change the substance of the agreement between Mrs Muir and the Gurupiras. The latter purchased the two issued shares that Mrs Muir had in the company. The purchase of those shares bestowed rights upon them. According to the agreement, they were entitled to certain rights in the immovable property owned by the company. The pertinent paragraphs of the agreement are set out hereunder and read:

C. The authorized share capital of the Company is divided into 32,000 (thirty-two thousand) ordinary shares of $1.00 each, of which authorized share capital 2 (two) ordinary shares (the shares) have been issued as follows:

SANDRA MAUREEN MUIR 2 CERTIFICATE No 1 & 3. She being the sole beneficial owner thereof;

D. The said shares confer on the holders thereof an exclusive right of occupation and use of the property;

E. The parties warrant that at the date of execution hereof and at the date of payment in terms of clause 2 of this agreement they are and they will be residents of Zimbabwe;

F. The purchaser warrants that he is using Zimbabwe dollars;

G. The seller is desirous of selling the shares, which shares confer on the holder hereof the exclusive right of use and occupation of the property and the improvements thereupon;”

From a perusal of these pertinent clauses in the agreement, the purchase by the Gurupiras of the two issued shares at the time of the sale entitled them to the exclusive use and occupation of the immovable property owned by the company. There was no novation of the agreement. There was no evidence that the agreement was ever cancelled. If it was, Mrs Muir did not choose to establish such fact before the court a quo. This she was obliged to do in order to oppose the claim for specific performance brought against her by the Gurupiras.

Specific Performance re: Approach, Impossibility of Performance and the Exceptio Non Adimpleti Contractus

This is an appeal against a judgment of the High Court handed down on 18 May 2016.

BACKGROUND FACTS

The facts which gave rise to this appeal are somewhat convoluted. Earthmoving & Construction Company (Private) Limited, the second appellant (hereinafter referred to as “the Company”), is a private limited company duly registered as such under the laws of Zimbabwe.

The Company had, at the time of incorporation, an authorized share capital of $32, divided into 32,000 ordinary shares with a nominal value of $0.001 each. Of those shares, only two had been issued. and were, at the time that these events evolved, owned by one Sandra Maureen Muir (“Mrs Muir”). This, in effect, gave 100 percent ownership of the issued shares to Mrs Muir.