MAKONI
J: The
applicants brought the present proceedings in terms of Rule 348A(5a)
of the High Court Civil Rules 1979 (The Rules).
They
seek an order suspending the sale in execution of Stand Number 834
Adylin Township of Lot 2A Bluffhill measuring 1211 square meters held
by the second applicant under Title Deed Number 549/07 (the
property).
They
seek a suspension for a period of 12 months from the date of the
order with a condition that within that period, the first applicant
clears its indebtedness to the first respondent in full. They also
seek an order of costs against the respondent.
The
brief background to the matter is that the respondent and in case
number HC4944/12 obtained a judgment against the applicants on 10
October 2012. On 11 March 2013 the applicants were served with a
Notice of Attachment of movable and immovable property.
On
19 March 2013, the applicant filed the present proceedings.
The
applicants seek the order on the basis that the second applicant and
his family resides at the property which is the subject of execution.
He does not have any other house. If the property is sold, undue
hardship and irreparable harm will be suffered by the second
applicant and his family. He will not be in a position to buy some
other house.
He
further avers that the first applicant had made significant inroads
towards extinguishing the debt and it has the capacity to pay off the
amount outstanding. The first applicant is owed substantial amounts
by several debtors chief among them the ZRP who owes it
USD1,200,000.00. They were therefore praying to be given a period of
12 months within which to clear the debt.
The
application is opposed and the respondent raised two points in
limine,
viz
locus
standi
of
the first applicant and that the property was bonded in favour of the
respondent and had been specially declared executable by an order of
court.
Locus
standi
It
was submitted on behalf of the respondent that the first applicant
lacks
the locus
standi
to bring an application in terms of Rule 348A(5a) and (5b) as it is a
body corporate, does not own the property in issue and was not in
occupation of attached property.
The
point was conceded by Mr Chinyama.
The concession, in my view, is proper.
Rule
5(a) provides:-
“Without
derogation from subrules (3) to (5), where the dwelling that has been
attached is occupied
by the execution debtor or members of his family,
the execution debtor may, within ten days after service upon him of
the notice in terms of Rule 347, make a chamber application in
accordance with subrule 5(b) for the postponement or suspension of –
(a)
the sale of the dwelling concerned; or
(b)
the eviction of its occupants.” (my own underlining)
In
Rule 348A(1) dwelling is defined as “a building or part of a
building including a flat, designed as a dwelling for a single
family……..”
If
Rule 348A(5a) is read together with the meaning of dwelling in Rule
348A, it will be clear that Rule 348A(5a) is not available to body
corporates.
The
Rule is designed for individuals who would be in occupation of the
attached property or whose family members are in occupation of the
attached property.
The
first applicant therefore, has no substantial interest in the
property and in non-suited in bringing the present proceeding.
Mortgaged
property and are declared specially executable by an order of court
It
was submitted on behalf of the respondent that Rule 348A does not
apply to sale of immovable property specially declared executable by
an order of a competent court.
Mr
Mutasa
referred to the case of Priscilla
Moda v
Homelink
(Pvt) Ltd and Anor HB195/11
at 13.
Mr
Chinyama
submitted that the rules in question does not specifically exclude
such properties.
It
is common cause that the second applicant's immovable property was
hypothecated to the respondent as security for due payment of the
amounts loaned to the first applicant. It is also common cause that
the applicants failed to repay the loan resulting in the respondent
instituting foreclosure proceedings. The respondent sought an order
that the property be specially executable and the applicants did not
contest the grant of such relief. The court duly granted the order
sought.
In
the Meda case (supra),
NDOU J (as he then was) dealt with the case which is almost on all
fours with the present matter. At p 3 of the cyclostyled judgment he
stated the following:-
“In
my humble view, execution of mortgaged property is different from the
property being referred to in order 40 Rule 348A. The difference is
that we dealing here with foreclosure proceedings. In foreclosure
proceeding, the security which the mortgager pledged is the one that
is sold after institution of judicial proceedings for the amount of
the debt, where after a writ of execution against the property is
issued. In one word, if the mortgagor does not pay the capital when
due, or if he commits any breach of the conditions of the contract
entitling the mortgage to foreclose then the latter is entitled to
have the secured property sold and obtain the amount of his debt from
the proceeding the sale – Benson v Hirschlorin 1936 NPD 277. A
mortgagor cannot claim a stay of execution in terms of Rule 348A
(supra).”
Further
down in the judgment NDOU J has this to say regarding property
declared specially executable by an order of the court;
“Having
made an order directing the sale of the house, applicant, cannot now
bring an application in terms of Rule 348A(5a) stopping the sale on
the basis she has made a reasonable offer. She is thus precluded from
doing so as allowing the application would have the effect of
rescinding, through the back door, the order that has been made by a
competent court. By declaring the house “specially executable”
the court has given the 1st
respondent the right to sell the house in execution to recover what
is owed to it.
The
mortgagor's first and foremost duty is to pay the debt secured and
the mortgage's corresponding right is to 'call up' or
'foreclose' the bond. The significance of mortgage bonds and all
other forms of hypothecation lies in the fact that they provide the
creditor with a 'real security' for the payment of his claim for
if the debtor is unable to raise the necessary funds to pay the debt
which is secured, the creditor is entitled to demand that the
property, that being the thing which is subject matter of his
security, be sold and that the proceeds of such sale are used for the
satisfaction of his claim
–
The
Law of Property (3rd
Ed) Silberberg and Schoeman at 419 and 429.” (own emphasis)
He
concluded by stating the following:-
“On
the basis of the aforesaid, it is respectfully submitted that Rule
348A is not applicable to foreclosure proceedings and to the sale of
immovable property which was been declared to be specially executable
as in this case. Accordingly, the present application must be
dismissed with costs on a legal practitioner and client scale. As
averred in the foreclosure proceedings filed it was a term of the
loan agreement and Deed of Hypothecation that Applicants would pay
Respondents legal costs on a legal practitioner and client scale. See
Scotfin
Ltd v Ngomahuru (Pvt) Ltd 1997 (2) ZLR 567.”
I
associate fully with the views expressed by NDOU J in Meda (supra).
In
casu,
the second applicant mortgaged to the respondent the property in
question to secure a debt advanced to the first applicant. When the
first applicant defaulted, the respondent instituted foreclosure
proceedings wherein it ought an order to have the property specially
executable. The applicants did not context the granting of such a
relief. They only sprung to action when the property was attached in
execution and filed the present proceedings.
As
was stated by NDOU J in Meda (supra),
this is seeking rescission of a judgment made by a competent court
declaring the property executable, through the back door.
In
view of the above, I will therefore uphold the points in
limine
as raised by the respondent and make the following order.
(i)
The application is dismissed with costs.
Chinyama
& Partners,
Applicants' Legal Practitioner
Costa
and Madzonga,
Respondent's Legal Practitioner
