MUZENDA
J:
The
plaintiff, N.R Barber (Private) Limited (hereinafter referred to as
“plaintiff”) is a company duly registered in terms of the laws of
Zimbabwe, whose registered office is 114 Seke Road, Graniteside,
Harare. The plaintiff specialises in mining operations, underground,
open cast, mining plans, transport logistics for ferrying the ore
from one place to the supplier and related business.
The
first letters of the plaintiff stand for Nolan Robert whose surname
is Barber. Incidentally he is the Managing Director and alter ego of
the plaintiff.
The
defendant, Zambezi Gas Zimbabwe (Private) Limited (hereinafter
referred to as the “defendant”) is equally a duly registered
company in terms of the law of Zimbabwe whose offices are situated at
Number 28 Transtobac Complex, Hillside Road Extension, Msasa, Harare.
Mr
Francis Chirimuuta the Managing Partner of Chirimuuta and Associates
is the Board Chairman of the defendant, Mr E. Raradza is the Managing
Director, Mr Thomas Nherera is the Executive Director, for Finance
and Administration, Mr M. Raradza is the Executive Director for
Operations and Marketing, Mrs R.M Kajese being the fifth Director.
The
defendant is a proprietor and hence holder of a coal mine situated in
Hwange under a special Grant Number 4084 in respect of coal reserves
which comprise of approximately 20,000,000 (twenty million) tonnes
mineable and extractable in situ tons of coal. The defendant then
formed a Special Purpose Vehicle under the name of Entuba Coal Fields
of Zimbabwe (Private) Limited whose registered office address is
given as 28 Hillside Road Extension Transtobac Complex, Msasa, Harare
whose directors are Dr C. Msipa, Mr Hlongwani, Mr E. Raradza, Mr T.
Nherera and Mr M. Raradza.
Dr
C. Msipa and Mr Hlongwani are directors of on other entity called
Coal Brick which company is known to the plaintiff. Hence Mr E.
Raradza and Mr T. Nherera are both directors of defendant and Entuba
Coal Fields.
On
28 August 2017 the plaintiff issued summons against the defendant for
the following relief;
(a)
payment of the amount of USD3,885,000, being payment of money due and
owed to the plaintiff by the defendant in terms of an acknowledgment
of debt which was executed by the defendant in favour of the
plaintiff on the 15th February 2017;
(b)
interest on the amount at the prescribed rate of 5% per annum
calculated from the date of summons to the date of payment in full;
and
(c)
costs of suit on attorney client scale.
In
paragraph 3 of the plaintiff's declaration it summarises the
plaintiff's cause of action as follows:
“3.
On the 15th of February 2017 the defendant executed an
acknowledgement of debt in favour of the plaintiff wherein it
admitted that the amount of $3,885,000 (three million eight hundred
and eighty five thousand United States dollars) was due and owed to
the plaintiff as a debt arising from the work done by the plaintiff
at Entuba Mine at the instance and request of the defendant.”
In
paragraph 5 of its declaration the plaintiff adds:
“the
defendant failed to pay the monthly instalments as per the
acknowledgement of debt and the amount of US$3,885,000-00 is now due
and owed to the plaintiff.”
The
defendant entered appearance and filed its plea and the gravamen of
its plea is contained in paragraph 3 which states the following:
“3:
Ad Paragraph 3 Defendant denies;
(a)
The existence of any privity of contract between plaintiff and itself
and denies that any work was allegedly performed on its behalf.
(b)
That plaintiff performed work on its behalf or for whomsoever at its
special instance and request. It puts plaintiff to the proof thereof.
Defendant
consequently denies that there was any legal cause for the alleged
acknowledgement of debt.”
On
the strength of this plea, the defendant prays that the plaintiff's
claim be dismissed with costs.
On
29 January 2018 the parties signed a joint pre-trial conference
minute which streamlined issues for trial as follows:
“1.
Whether there was legal cause for the acknowledgement of debt.
2.
Whether the debt acknowledged by the defendant arises from work done
by the plaintiff at the instance and request of the defendant.
3.
What amount is due by the defendant to the plaintiff?”
On
13 June 2018 the matter proceeded to trial.
Mr
NR Barber, the plaintiff's Managing Director gave evidence. He
stated that between 2013 and 2014 he was tasked to do work at Hwange
by Entuba Mine, a company owned by the defendant company. The total
amount due from Entuba was $3,012,493.46 and on 12 May 2016 the
defendant's Chief Executive Officer Mr Thomas Nherera wrote to the
plaintiff acknowledging its indebtedness to the plaintiff for that
amount.
The
first acknowledgement of debt authored and signed by the defendant's
directors was produced by the plaintiff in court and accepted as
exhibit number 1.
In
the contents of exhibit 1 the witness pointed out that the defendant
thought it acknowledged its indebtedness to the plaintiff in the sum
of $3,012,493.46, a reconciliation of the total capital owed was
going to be carried out and factor in any amount towards fuel expense
issued to the plaintiff during the operations, thereafter interest
was going to be added to the capital.
On
15 February 2017 Mr N.R. Barber told the court that indeed a second
acknowledgement of debt showing a deduction in capital and a figure
of interest was signed by the defendant. The second acknowledgement
of debt, exhibit 2 was produced in court.
Mr
NR Barber further clarified and confirmed that although all the
invoices were reflecting Entuba Coal Mine, those were subsequently
accepted by the defendant and the defendant acknowledged its
indebtedness to the plaintiff and what was more crucial to the
plaintiff were the acknowledgements of debt specifically created,
authored and signed by the defendants which formed the plaintiff's
cause of action.
He
clearly testified that Entuba Mine was a special purpose vehicle
formed by the defendant and he was not surprised when the defendants
delivered to him exhibit(s) 1 and 2. He believed the defendant when
it told him that it was going to take over the debt.
In
any case according to the witness the defendant was the beneficiary
of the product the plaintiff produced.
He
added that at all material times Mr T Nherera was aware of all the
invoices issued to Entuba and Mr T. Nherera used the same invoices to
prepare and reconcile figures which he ultimately used to compile the
acknowledgement of debts.
Mr
N.R. Barber was extensively cross examined by the defendant's
counsel but he maintained his stance and further added that although
the defendant was joined by Linos Masimura well after the signing of
the acknowledgement of debt the defendant did not challenge the
authenticity of the acknowledgment.
Mr
NR Barber was actually surprised when Mr E Raradza and Mr T Nherera
refused to honour the defendant's indebtedness. The amount of
$3,885,000 was calculated and reconciled by the defendant and it
ought to be honoured, he contended.
The
plaintiff's second witness was Mr Antiock Kuraone who was appointed
as agent by the plaintiff to recover the outstanding debt.
When
the witness was appointed he engaged the directors of the defendant,
the Managing Director Mr E Raradza and Mr T. Nherera. The defendants
unreservedly acknowledged owing the plaintiff an amount of
$3,885,000-00 and they produced exhibit no. 2 where the defendant
indicated the proposed date of payment with a cut-off date for last
payment being February 2020.
The
witness reiterated the fact that in as far as the legal cause of the
acknowledgement of debt was concerned, the acknowledgements
themselves prepared by the defendant succinctly disclosed the cause,
that is, for payment of money for the work done for the defendants at
Entuba Mine in Marange.
Exhibit
2 was signed by the Managing Director Mr E Raradza and Director
Finance and Administration Mr T Nherera.
The
two were not forced and cooperated throughout the engagement, he
said.
He
also clarified that at no time did the defendant raise the issue of
liability, the sticking issue that arose when he came into the matter
was basically reconciliation, more particularly, of factoring in the
fuel aspect. Otherwise the parties were in agreement as to the
amount.
During
cross examination by the defendant's counsel, the witness remained
adamant that the issue of legal causa did not arise during the
engagement.
Mr
T. Nherera was fully aware of all the verifications and he (Mr T
Nherera) is the one who did the reconciliation.
Mr
Kuraone rejected the amount of $896,884 as the correct amount and
denied that Mr Masimura engaged him for a revisit on the alleged
reconciliation of the figures contained on the acknowledgements.
After
the acknowledgement what Mr Kuraone and the plaintiff were waiting
for was payment. When the defendant did not honour the payment he
advised the plaintiff to take legal action, which the plaintiff did.
Mr
Kurauone impressed the court as an honest witness, he did not
exaggerate but remained forthright. He actually confirmed Mr N.R.
Barber's testimony and both witnesses were credible. Their evidence
tallies with the exhibits produced in court.
Application
for absolution at the close of plaintiff's case
When
the plaintiff closed its case, the defendant made an application for
absolution from the instance.
I
dismissed the application and indicated that the plaintiff has
established a prima facie case on a balance of probabilities and the
court has to hear the side of the defendants. The reasons for the
decision will be dealt with below.
Defendant's
Evidence
The
defendant called Mr Edward Raradza, its Managing Director; to give
evidence. I will deal with portions of his evidence relevant to the
matter before me.
He
told the court that sometime in September 2013 the defendant and Coal
Producers and Processors Trust Zimbabwe entered into a joint venture
agreement where the two parties formed a Special Purpose Vehicle,
Entuba Coalfields (Private) Limited. The defendant was to avail its
mining concession to the joint venture and Coal Producers Trust was
to provide resources to mine the coal.
The
plaintiff was brought on site to Entuba Coalfields to provide mining
contractor services.
According
to the witness it was Coal Producers Trust which brought the
plaintiff to Entuba and payment of work done by the plaintiff per
Entuba was Coal Producers Trust's responsibility. He repeated what
is contained in the defendant's plea, that there was no contractual
arrangement between the plaintiff and the defendant.
In
July 2015 the Special Purpose Vehicle Entuba Coal Mine Company became
dysfunctional and the defendant repossessed its mining concession.
The defendant was aware of the plaintiff's debt and according to Mr
E Raradza the defendant without any legal obligation thereto,
executed an acknowledgement of debt in favour of the plaintiff in the
amount that the plaintiff had indicated was wrong subject to a
reconciliation being conducted.
He
added that the defendant could not pay because the income flows from
the mining operations did not permit fulfilment of such undertakings
that the defendant had made.
During
cross-examinations by the plaintiff's legal practitioner, Mr
Raradza unequivocally admitted that the directors and the defendant
company confirm that the plaintiff is owed but the only contentious
issue was the amount. He accepted the authenticity of both exhibit 1
and 2 and per exhibit 2 he accepted that he co-signed it but he was
not familiar with issues relating to costing mining invoices. He
admitted that efforts were made to reconcile the figures acknowledged
but was not clear as to when such efforts were made, before the
drafting of exhibit 2 or after it was already signed.
Most
of his evidence actually substantiated the plaintiff's case.
The
defendant's second witness was Mr Thomas Nherera. In principle the
witness dwelt more on corporate divisibility, that as long as there
are two existing companies, the liability of one does not cross the
demarcating line to the other side. Each company is accountable to
its own liabilities. Hence defendant did not enter into any
contractual relationship with the plaintiff and as such there was no
pretext for the writing of the acknowledgement of debt.
He
however brought a very crucial revelation which greatly assisted this
court. He admitted under cross examination that the Managing Director
of defendant and himself were both directors of Entuba. He was its
Chief Executive Officer and he is the one who received all the
invoices from the plaintiff. Using those invoices, he prepared
exhibit 1 and 2. However when exhibit 1 and 2 were prepared and
signed the real motive was to retain business relationship and
rapport with Mr NR Barber but thus far.
He
also admitted that Entuba had no assets at all and was fictitious in
principle.
Mr
T Nherera was evasive during cross-examination and had difficulties
in answering simple questions. He contradicted Mr E Raradza
especially on the aspect of liability of the defendant to the
plaintiff.
Mr
Linos Masimura was the defendant's third witness.
He
holds a Masters in Business Leadership and is involved in mining
operations in Zimbabwe and South Africa. He is the Deputy Managing
Director of the defendant from June 2017. When he joined the
defendant he was briefed about the defendant's status, its
employees and liabilities. He was shown exhibit 1 and 2 and undertook
to do a verification exercise. He visited the mine at Hwange with Mr
E Raradza the Mining Manager and Mr Kurauone. He worked out a
reconciliation thereafter and came out with a figure of $896,884-00
as being the “real” amount per the work done by the plaintiff. He
also worked out the total sum of payments made to the plaintiff, by
Entuba or payments made to plaintiff for work done.
He
strengthened the defendant's plea that there was no legal causa
between the plaintiff and the defendant.
During
“conciliation” of figures, he worked with Mr Kurauone who was
representing the plaintiff but when the witness engaged Mr Kurauone
with the figure of $896,884, Mr Kurauone could not accept it.
The
witness is not an accountant, he did not produce a comprehensive
audit report based upon the acknowledgement figures and show the
deductions of double invoicing. The document shown by the witness is
but scanty. It does not show the reconciliation process for one to
come up with the amount of $896,884-00.
The
witness was cross-examined by the plaintiff's counsel and was at
pains to explain how he arrived at that figure of $896,884.00.
He
did not agree with the Managing Director's evidence that the
defendant owes the plaintiff money.
After
the testimony of Mr L Masimura, the defendant closed its case.
Application
for Absolution from the instance
As
indicated herein above after Mr E Matinenga applied for absolution
from the instance. I indicated that I will give my reasons in the
main judgment. These are they.
Mr
Matinenga submitted that at the close of the plaintiff's case, the
defendant has three options open to it.
1.
to proceed to the defence case.
2.
apply for absolution.
3.
apply for the dismissal of the plaintiff's case.
The
defendant opted to apply for absolution from the instance.
The
defendant attacked the plaintiff's declaration and more
particularly the absence of a legal causa between the acknowledgement
of debt and the defendant. There is no privity of contract between
plaintiff and the defendant and that would undermine the fundamentals
of the acknowledgment of debt.
Plaintiff's
relief laid with Entuba and not the defendant, it was argued.
Defendant
also argued there are instances when the courts went outside the
acknowledgment to trace the history of that acknowledgment. Mr
Matinenga vehemently argued that there was no evidence placed before
the court that could move the court to find in favour of the
plaintiff.
Mr
Matapura opposed the application and highlighted evidence of the
produced exhibits 1 – 4. The undisputed acknowledgments of debt.
He
submitted that indeed a prima facie was established by the plaintiff
and defendant had to be put on its defence.
The
Law
In
the matter of Standard Chartered Finance Zimbabwe v Georgias &
Anor 1998 (2) ZLR 547 (H) SMITH J at p552 F – 553 D had this to
say:
“After
the close of Trinity's case Mr de Bourbon moved for absolution from
the instance. In doing so he referred to Supreme Service Station
(1969) (Pvt) Ltd v Fox & Goodridge (Pvt) Ltd 1971 ZLR at 5D where
BEADLE CJ said:
'The
test, therefore, boils down to this: Is there sufficient evidence on
which a court might make a reasonable mistake and give judgment for
the plaintiff? What is reasonable mistake in any case must always be
a question of fact, and cannot be defined with any greater exactitude
than by saying that it is the sort of mistake a reasonable court
might make a definition which helps not at all.'
Further
on, at 5 – 6, the learned Chief Justice went on to say:
'Before
concluding my remarks of the law on this subject I must stress that
rules of procedure are made to ensure that justice is done between
the parties, and, so far as is possible, courts should not allow
rules of procedure to be used to cause an injustice. If the defence
is something peculiarly within the knowledge of a defendant, and the
plaintiff has made out some case to answer, the plaintiff should not
lightly be deprived of his remedy without first hearing what the
defendant has to say. A defendant who might be afraid to go into the
box should not be permitted to shelter behind the procedure of
absolution from the instance. I might usefully quote here what was
said by SUTTON J in Erasmus v Boss 1930 CPD 204 at 207.
In
Theron v Behr 1918 CPD 443, JUTA J at p 451 states that according to
the practice in this court in later years judges have become very
loath to decide upon question of fact without hearing all the
evidence on both sides.
We
in this territory had always followed the practice of the Cape
courts. In case of doubt at what a reasonable court “might” do, a
judicial officer should always, therefore, lean on the side of
allowing the case to proceed…
In
Quintessence Co-ordinators (Pty) Ltd v Government of the Republic of
Transkei 1993 (3) SA 184 (TK) at 185 B – D HANCKE J said:
'The
legal test to be applied at this stage appears to be common cause
namely whether there is evidence upon which a reasonable man might
find for the plaintiff: Claude Neon Lights (SA) Ltd v Daniel 1976 (4)
SA 403 (A) at 409.
Mr
Findlay, counsel for the defendant, accepted that at this stage of
the trial neither the weight of any of the evidence tendered, nor any
evaluation of the probabilities are relevant to the enquiry, save
where such findings are clearly manifest from the evidence. I also
agree with his submission that where the question is exclusively one
of law or involves the application of a legal principle in the light
of the onus-bearing party being required to establish certain
material facts essential to its cause of action, if I uphold the
legal contention in favour of the defendant or find that essential
material facts have not been established at all in order that there
be a finding favourable to the plaintiff, then can properly, in the
exercise of my discretion, grant the application for absolution.'
At
p 554 A the learned judge concluded:
'a
judicial officer should always lean on the side of allowing the case
to proceed.'”
The
evidence produced by the plaintiff more particularly exhibits 1 and
2, in my view is reasonable evidence on which the court might find
for the plaintiff, hence I ordered that the case should continue, and
it did.
Analysis
of plaintiff's Exhibits
Exhibit
1
Exhibit
1 is the first acknowledgment of debt dated 12 May 2016. The exhibit
reads as follows:
“AGREEMENT
OF INDEBTEDNESS
We
acknowledge our indebtedness to your company N R Barber (Pvt) Ltd in
regards to the contract mining work your company carried out for us
at Zambezi Gas's Entuba Coal Concession in Hwange, Zimbabwe.
We
acknowledge the capital amount of USD3,012,493.46 (USD Three million
and twelve thousand four hundred and ninety three dollars and forty
six cent) subject to the reconciliation of the total amount of fuel
issued out to NR Barber (Pvt) Ltd mining team during the period
between 16 May 2014 to 4 June 2014. This amount excluding interest.
This interest will be added after reconciliation of total capital
amount owing as per the contract.
We
are also agreeable to your proposal that as soon as inflows of income
from our mining operations start to come in the proceeds will be
shared amongst us at the agreed percentages that shall be agreed
between Zambezi Gas and NR Barber (Pvt) Ltd at that time. We are also
agreeable to giving you full access to our books of accounts so as to
have full transparency between us.
This
agreement is without prejudice to prior contracts made between our
two parties.” (my emphasis)
The
letter was written by the defendant company and signed by Mr Thomas
Nherera its Chief Executive Officer, defendant's second witness in
this trial. It originates from defendant company written on the
defendant's letter head. The defendant's witnesses acknowledge
same.
Exhibit
2
This
letter was written and signed by Mr E Raradza (the Managing Director
of defendant) and Mr Thomas Nherera (Executive Director Finance and
Administration) dated 15 February 2017 on behalf of the defendant.
It
is equally central to this matter and it needs extensive quotation
and analysis. It is necessary to quote it as is:
“Zambezi
Gas Zimbabwe Private Limited
15
February 2017 Mr J.M Kurauone Harare Attn: Mr Kurauone
Dear
Sir
REPAYMENT
PROPOSAL FOR THE PAYMENT OF N.R BARBER (PVT) LTD
We
as Zambezi Gas Zimbabwe (Pvt) Ltd are committed to the repayment of
the principle debt of USD2,715, 000 (two million seven hundred and
fifteen thousand dollars) and an interest amounting USD1,170,000 (one
million one hundred seventy thousand dollars) to the work done at
Entuba Coal Mine in Hwange between 2014 and 2015. We are proposing
the following repayments starting from February 2017 onwards to
February 2020.
MONTH
AMOUNT (USD)
February
2017 10,000
March
2017 10,000
April
2017 15,000
May
2017 15,000
June
2017 20,000
July
2017 20,000
August
2017 30,000
September
2017 30,000
October
2017 40,000
November
2017 40,000
December
2017 40,000
Total
265,000
January
2018 50,000
February
2018 50,000
March
2018 70,000
April
2018 70,000
May
2018 90,000
June
2018 90,000
July
2018 100,000
August
2018 100,000
September
2018 100,000
October
2018 100,000
November
2018 100,000
December
2018 100,000
Total
1,020,000
January
2019 150,000
February
2019 150,000
March
2019 200,000
April
2019 200,000
May
2019 200,000
June
2019 200,000
July
2019 200,000
August
2019 200,000
September
2019 200,000
October
2019 200,000
November
2019 200,000
December
2019 200,000
Total
2,300,000
January
2020 150,000
February
2020 150,000
Total
300,000
Total
all arrears $3,885,000
We
are hopeful that you will find this a fair way of settling this
outstanding debt.
Yours
faithfully
E
RARADZA (ER)
T
NHERERA (TN)
MANAGING
DIRECTOR, EXECUTIVE DIRECTOR FINANCE & ADMINISTRATION”
Exhibit
1 and 2 gave rise to the action taken by the plaintiff. The following
aspects seem not to be controverted by the parties;
(a)
defendant and the plaintiff are known to each other in business.
(b)
the defendant's own agents/directors Mr E Raradza (the Managing
Director) and Mr T Nherera (Executive Director: Finance &
Administration) wrote exhibit 2 above proposing to settle the debt of
the exact amount owed by the defendant to the plaintiff in the sum of
$3,885,000.00.
(c)
the defendant unconditionally undertook and promised to pay specified
amounts of money per month from 2017 to the month of February 2020.
(d)
the acknowledgment of debt are of a specific sum of money and made in
writing by the defendant's authorised agents and accepted by the
plaintiff.
(e)
the defendant is bound by the actions of its agents, Mr E Raradza and
Mr T Nherera resultantly; the defendant through, the actions of its
agents rendered itself liable as the principal.
(f)
Exhibit 2 written by the defendant acknowledging indebtedness to the
plaintiff is not denied by defendant in its pleadings, hence it is
deemed authentic and accepted by the defendant.
Contrary
to what is contained in the defendants plea more particularly
paragraph 3 thereto, the defendant in its letter of 15 February 2017
unreservedly acknowledge that the US$3,885,000 was due “to the work
done at Entuba Coal Mine in Hwange between 2014 and 2015.”
The
opening of the letter/acknowledgment of debt dated 15 February 2015
reads as follows:
“We
as Zambezi Gas Zimbabwe (Pvt) Ltd are committed to the repayment of
the principle (sic) debt of ……”
This
in this court's view is not disputed by the defendant if the
foregoing are issues of common cause then what is the reason
proferred by defendant to impugn or perjure the acknowledgment of
debts duly signed by it?
Exhibit
2 is self-explanatory to the aspect of legal cause raised in
defendant's plea.
Defendant
in its own letter to the plaintiff admits that the amount due to
plaintiff was for work done at Entuba Coal Mine in Hwange and that it
was committed to the repayment in full, albeit, in staggered figures.
The acknowledgment did not question the motive or otherwise by the
defendant to pay or not to pay.
The
plea by the defendant was not sustainable.
If
it had denied authorising the 15 February 2017 letter maybe one would
have understood that.
When
the defendant on its own letter head signed by its own directors
acknowledging the amount due and proposing sums of payments per
month, then disown such evidence, defies all logic.
The
acknowledgments of debt authored by the defendant contained the legal
causa of the debt. They had written confirmations of the matter in
dispute and acknowledged the exact amount due to the plaintiff.
Entuba
Coal Mine was created by the defendant's directors. The registered
office of Entuba was the same with that of the defendant, 28
Transtobac Complex, Hillside Road Extension, Msasa Harare. Mr Thomas
Nherera was Entuba Coal Mine's Chief Executive and defendant's
Managing Director Mr E Raradza was a co-director of Entuba. Entuba
was formed to operate defendant's mining concession in Hwange and
all the invoices for Entuba were send to defendant's address for
the attention of Mr T Nherera.
Entuba
Cola Mine was hence purely an alter ego of Mr Raradza and Mr Nherera.
One cannot differentiate defendant from Mr Raradza and Mr Nherera and
from Entuba.
This
court has found that the work done at Entuba by plaintiff at Hwange
mine was at the instance of the defendant. This is clearly accepted
by the defendants in exhibit 1 and 2 and Mr E Raradza ungrudgingly
accepted this during trial.
It
is therefore found that there is a legal causa to the acknowledgment
of debt as admitted by the defendant's directors.
Exhibit
1 and 2 captures the previous transactions and embodies such to show
how the amounts arose from work done on behalf of the defendants.
Defendant
voluntarily wrote to the plaintiff confirming its indebtedness and in
terms of exhibit 2, defendant outlines the estimated period of
settlement of the debt until the whole sum is liquidated.
Hence
not only an amount is acknowledged but also a promise to pay and
specific dates provided by the defendant in writing.
Assuming
that the defendants are stating the truth that the court should treat
Entuba and defendant as separate legal entities which I do not
accept, from the day exhibits 1 and 2 were written by the defendant
such acknowledgments bound the defendant and exhibit 2 became the
cause of action at the instance of the plaintiff.
The
defendant in its plea presents a bare denial based on law. It
persisted that there was never any contractual relationship between
it and the plaintiff and during trial, it tried to point a picture
that exhibits 1 and 2 were prepared out of compassionate grounds with
the intention to maintain good business relationships with Mr NR
Barber, the Managing Director for plaintiff.
The
reading of exhibits 1 and 2 shows a totally different picture.
Exhibits
1 and 2 show that defendant adopted the liability and undertook to
settle the amounts due.
The
figure of $3.012,493.46 was revised as the capital figure and on
exhibit 2 the capital principal debt became $2,715,000. Such a
reconciliation is consistent with the undertaking of the defendant in
its letter of 12 May 2016, exhibit 1.
The
Managing Director, Mr E Raradza and the Chief Executive Officer, Mr T
Nherera wanted to convince the court that they had no knowledge of
mining concepts of invoicing but defendant's Board Chairman is a
legal practitioner of long outstanding and experience - surely he
would have explained to the defendant the legal effect of exhibit 1
and 2 and it is assumed in the circumstances that such advise was
given to the defendant and it proceeded to prepare them.
Mr
Masimura came to join the defendant well after exhibits 1 and 2 had
been prepared. The alleged reconciliation was post facto and could
not affect exhibits 1 and 2.
Mr
T Nherera is in charge of defendant's finance and he is the one who
initiated both exhibits 1 and 2, the only reasonable inference
relating to exhibits 1 and 2 in this court's view is that they
reflect the actual amount owed to the plaintiff.
The
amount of $896,884 does not appear in defendant's plea.
It
only emerges in exhibit No. 4; defendant's legal practitioner's
letter dated 24 August 2017 written in reply to plaintiff's letter.
It was never tendered to the plaintiff as being the amount due to the
plaintiff. It was not even admitted by the defendant in its papers.
There is no evidence to show that the figure came as a result of
conciliating $3,012,493.46 contained in exhibit 1.
The
court concludes that the amount of $3,885,000 acknowledged by the
defendant on 15 February 2017 is the capital debt inclusive of
interest due to the plaintiff.
The
Law
In
the matter of Bared van Wyk v Tarcon (Pvt) Ltd SC49/2014, PATEL JA on
p 3 of the ecyclostyled judgment stated the law as follows:
“In
the circumstances, I am inclined to take the view, in the absence of
evidence to the contrary, adduced before the court a quo, that the
claim in casu was based on a Stated Account. There was an agreed
acknowledgment of liability signed on behalf of the respondent. All
that appears to have been required thereafter is its Chairman's
approval of the payment plan or method of discharging that agreed
liability.
As
was recognized by the learned judge, it is competent to sue a debtor
on his admission of liability as set out in an acknowledgment of debt
without founding the action on the original transaction giving rise
to that acknowledgment. See Mahomed Adam (Edms) Beperk v Raubenhumer
1966 (3) SA 646 TRD and the authorities there cited.”
The
above legal position is very apposite to the matter before me.
I
do not agree with the defendant's argument to the effect that the
court should go beyond the acknowledgment of debt to see the motive
or basis behind its birth or existence.
The
plaintiff has managed to prove its case on a balance of probabilities
and in effect the defendant to a large extent agrees with plaintiff's
evidence on material aspects.
Disposition
Plaintiff's
claim succeeds and it is ordered as follows;
1.
Judgment be and is hereby entered for plaintiff in the sum of
USD3,885,000.00 (three million eight hundred and eighty five thousand
United States dollars);
2.
Interest on the amount of US$3,885,000 at the rate of 5% per annum
calculated from the date of summons to the date of payment in full;
and
3.
Costs of suit on an attorney client scale.
Dondo
and Partners, plaintiff's legal practitioners
Chirimuuta
and Associates, defendant's legal practitioners
