GUVAVA
JA:
INTRODUCTION
[1] This
is an appeal against the whole judgment of the High Court sitting at
Harare dated 10 July 2019 in favour of the respondent. The court a
quo
in this case granted an
interdict against the first and second appellants ordering them to
share the money collected between 2014 and 2018 in accordance with
the partnership agreement and stopping them from interfering with the
management of stands 147 and 151 Mbuya Nehanda Street Harare.
BACKGROUND
FACTS
[2] In
order to understand the basis of this appeal it is necessary to set
out in some detail the background of this matter. The first
and
second appellants ('the appellants') are the owners of commercial
properties known as Stand 147 and 151 Mbuya Nehanda Street, Harare
('the properties'). The third appellant is a law firm
representing the appellants. The respondent is a real estate company,
registered in terms of the laws of Zimbabwe.
[3] The
first and second appellants and respondent entered into a partnership
agreement wherein the respondent would develop and build shops on the
appellant's stands. In terms of this agreement, it would be valid
for a period of 3 years and subject to renewal by both parties. The
parties also agreed that the respondent would develop and effect
certain improvements on the two properties at its own expense. It was
further agreed that upon completion of the development of the
properties, the parties would lease them out with the appellants
being entitled to 67 per cent of the rentals and the respondent to 33
per cent.
[4] Subsequent
to this agreement, the parties entered into a commercial lease
agreement dated 26 August 2010, which resulted in a joint venture
agreement. Following the creation of the lease agreement, a dispute
arose between the parties. The first and second appellants alleged
that the contract between the parties was to operate for a period of
3 years only whereas the respondent alleged that it was for a period
of at least 15 years. The averment by the respondent was made on the
basis of purported terms of a prior verbal agreement which the
parties made before the creation and signing of the partnership
agreement on 10 January 2010.
[5] The
dispute between the parties resulted in numerous litigation between
the parties. On 4 September 2013 the respondent approached the High
Court under case number HC 7215/13 seeking an interdict stopping the
appellants from interfering with the respondent's management of the
properties as agreed in the partnership agreement. The application
resulted in a consent order which was granted by TAKUVA J and whose
operative part reads as follows:
“1.
Pending final disposition of the substantive dispute between the
parties through arbitration proceedings, the status quo
obtaining at the premises in question shall continue to subsist and
the parties' relations shall continue to be regulated by the
existing agreements.
2.
The parties shall proceed with due expedition to refer the dispute
between them to the Commercial Arbitration Centre for resolution by
an Arbitrator who shall dispose of the substantive dispute in
accordance with the provisions of the Arbitration Act.
3.
Each party shall bear its own costs.”
[6] The
dispute was referred to arbitration on 13 October 2013. The
respondent sought a determination regarding whether the joint venture
agreement had ceased to exist, whether it was entitled to take over
the management and control of the developed premises and
alternatively whether the appellants had lawfully cancelled the
agreements.
[7] The
respondent further filed an application for rectification before the
High Court which sought the rectification of the partnership
contracts so as to reflect the true intention of the parties in
relation to the duration period to be covered by the agreement. The
respondent alleged that the arbitrator, retired SMITH J, then wrongly
advised it to withdraw its application for rectification before the
High Court so that he would deal with it himself. The respondent
further alleges that it cooperated without knowing that the
arbitrator was an interested party and he went on to dismiss the
rectification application.
[8] On
29 May 2014, the arbitrator granted an interlocutory award in favour
of the first and second appellants which ordered the respondent to
remit all the rentals collected into the third appellant's trust
account. On 6 December 2016, the arbitrator issued a final award.
The
appellants sought to register the arbitral award under case number HC
1054/17.
[9] On
the other hand the respondent made an application for the setting
aside of the arbitral award under HC1347/17. The applications were
heard together by Phiri J who set aside the arbitral award and
dismissed the appellants' application for registration of the
award. The appellants noted an appeal against this decision before
the Supreme Court under case number SC351/19. Following the setting
aside of the arbitral award by Phiri J, the respondent filed an
application for an interdict against the appellants. The respondent
sought to interdict the appellants from interfering with the
management of the properties and a mandatory interdict ordering that
rentals collected should be shared in terms of the partnership
agreement.
SUBMISSIONS
A
QUO
[10] In
making the application, the respondent averred that the written
agreement between the parties did not correctly reflect the intention
of the parties. It was always their intention that the agreement
would operate for a period of 15 years to enable the respondent to
recover its capital and make a reasonable profit. The respondent
further averred that to prove the agreement was meant to exist for 15
years, some of the tenants were made to enter into lease agreements
of 15 years whereby both parties appended their signatures confirming
the partnership would subsist for 15 years. Further the respondent
averred that it had invested about one million dollars into the
project and by the time when the application was made, it had only
recovered about US$250,000.00.
[11] The
appellants opposed the application and argued that the partnership
agreement between the parties was never set aside and was to operate
for 3 years only. The appellants also submitted that the respondent
had no lawful right to collect rentals from the occupants of the
premises in dispute.
[12] The
court a
quo
in dealing with the application found that the respondent had managed
to satisfy the requirements of a temporary interdict which it sought.
The court further found that the arbitral award having been set aside
and that decision having been appealed against, the consent order by
TAKUVA J was in operation in determining how the parties would
interact pending the appeal. The court found that the interim award
changed the status
quo
which had been determined by the order of TAKUVA J and that, the
interim award thus contradicted the consent order. The court held
that the consent order granted by TAKUVA J was an order of a superior
jurisdiction compared to arbitration proceedings. Thus, the only
courts which could interfere with the order are the High Court itself
or other superior courts. As such, the court found that the
arbitrator misdirected himself by varying an order of the High Court.
Thus, the order governing the parties was the consent order and not
the interim order.
[13] On
that basis the court granted the application for an interdict sought
by the respondent and made the following order:
“1.
The money collected since 2014 to 2018 and remitted in the 3rd
respondent's trust account, all arrear rentals the respondent's
collected in form of cash or through their personal accounts and
money sitting in the trust account of the Law Society of Zimbabwe be
shared in accordance to the partnership agreement in proportion of
33% and 67% respectively.
2.
1st
and 2nd
respondents be and are hereby ordered to stop interfering in the
management of both stand 147 and 151 Mbuya Nehanda Street, and
collection of rentals on stand Mbuya Nehanda Street, Harare as
dictated by the partnership agreement pending the outcome of an
appeal filed under SC351/19.
3.
The 1st,
2nd
&
3rd
respondents jointly and severally each paying the other to be
absolved pay the costs of this application.”
[14] Dissatisfied
with the decision of the court a
quo
the appellant noted this present appeal under the following grounds:
“1.
The court
a quo
erred at law and grossly misdirected itself on the facts relating to
an interim interdict application and affording such relief in
circumstances where no such application was before it.
2.
The court a
quo
erred and misdirected itself in finding as it did that Mr Justice
Takuva's order was negated by the interim arbitration award of 29
May 2014. This ignored the common cause position that the consent
order of Mr Justice Takuva contemplated resolution of the dispute in
terms of the relevant law, which law, provides for the relief of an
interim award.
3.
In any event, the court a
quo
grossly erred and misdirected itself in affording interdictory relief
in light of the extant arbitration award of 8 September 2014
dismissing respondent's rectification claim.
4.
The court a
quo
erred and grossly misdirected itself in resuscitating a partnership
agreement whose fate had been sealed by the dismissal of the
rectification claim by the arbitrator, retired Justice Smith and
therefore no basis existed for the court to order any sharing of
rentals and/or management of 1st
appellant's property.
5.
The court a
quo
grossly erred and misdirected itself in granting interdictory relief
where the respondent had not met the requirements of such relief.”
ISSUES
FOR DETERMINATION
[15] It
appears to me that from the five grounds of appeal the determination
of one issue will resolve the dispute. The issue for determination is
whether or not the court a
quo
correctly granted the interdict sought by the respondent.
SUBMISSIONS
ON APPEAL
[16] At
the hearing, Ms.
Mahere
for the appellants, argued that the application made before the court
a
quo
by the respondent was an application for a final interdict. It was
counsel's argument that the draft order sought by the respondent
clearly showed that paragraph 1 was for a final mandatory interdict
whereas paragraph 2 sought a prohibitory interdict of interference.
With that counsel argued that the court misdirected itself when it
considered the requirements of an interim interdict as no such
application was before it.
[17] Counsel
further argued that the court a
quo
failed to correctly apply the requirements of a final interdict as
had been sought by the respondent. It was argued that the respondent
had no clear right to claim as the dispute between the parties
pertaining to the partnership agreement was ongoing and as such no
clear right could be deduced from the ongoing dispute. Also, it was
counsel's argument that the respondent failed to satisfy the
requirement that it did not have alternative remedies as it could
still claim damages, specific performance or an order of contempt of
court against the appellants.
[18] Per
contra,
Mr. Hashiti,
counsel for the respondent, argued that the court a
quo
correctly granted the draft order which was sought by the respondent
as the respondent had satisfied all the requirements in making its
application. Counsel further argued that the only remedy the
respondent had in the face of the appellants continued disturbance of
its management of the properties, was for the respondent to seek for
an interdict which was correctly granted by the court.
APPLICATION
OF THE LAW TO THE FACTS
[19] The
respondent made an application for a final interdict before the court
a
quo.
In its founding affidavit it listed the requirements it had to
satisfy in making the application, being: existence of a clear right,
imminent danger, irreparable harm and absence of other remedies. The
respondent's draft order reads as follows:
“1. The
money collected since 2014 to 2018 and remitted in the 3rd
respondent's trust account, all arrear rentals the respondent's
collected in form of cash or through their personal accounts and
money's sitting in the trust account of the Law Society of Zimbabwe
be shared in accordance to the partnership agreement in proportion of
33% and 67% respectively.
2.
1st
and 2nd
respondents be and are hereby ordered to stop interfering in the
management of both stand 147 and 151 Mbuya Nehanda Street, and
collection of rentals on stand 151 Mbuya Nehanda Street, Harare as
dictated by the partnership agreement.
3.
The 1st,
2nd
&
3rd
respondents jointly and severally each paying the other to be
absolved pay the costs of this application on an attorney and client
scale.”
[20] The
court a
quo
in determining the application made by the respondent however went on
to consider the requirements of an interim interdict. The court noted
as follows:
“The
applicant seeks both a mandatory and prohibitory interdict. The
requirements of a temporary interdict are trite. They are;
1.
a prima
facie
right, though it may be open to doubt;
2.
a well-grounded apprehension of irreparable harm;
3.
the balance of convenience must favour the grating of the interdict;
4.
absence of any other satisfactory remedy.
….
I
will proceed to consider whether the applicant satisfied the
requirements of the temporary interdicts sought.”
[21] From
the above remarks made by the court a
quo
it is clear that the court fell into error when it considered the
application before it as an application for an interim interdict when
in fact it was an application for a final interdict.
[22] The
requirements that must be established in an application for a final
interdict have been set out in a long line of cases in this
jurisdiction. In the case of Econet
Wireless Holdings & Ors v Min of Finance & Others
2001
(1) ZLR 373 (S) at 374 B this Court had occasion to once again
succinctly set them out.
The
court held that:
“What
the appellants in this case sought was a final interdict. In order to
succeed in obtaining such an interdict they had to establish: (a) a
clear right; (b) an injury actually committed or reasonably
apprehended; and (c) the absence of similar protection by any other
ordinary remedy. See Setlogelo
v Setlogelo
914
AD 221 at 227; Sanachem
(Pty) Ltd v Farmers Agri-care (Pty) Ltd & Ors
1995
(2) SA 781 (A) at 789 B-C; Charuma
Blasting & Earthmoving Svcs (Pvt) Ltd v Njanjai & Ors
2000
(1) ZLR 85 (S) at 89 D; Blue
Rangers Estates (Pvt) Ltd v Muduviri & Another
2009 (1) ZLR 368 (S).”
Whereas
the requirements for an interim interdict were aptly stated in
Airfield
Investments (Pvt) Ltd v Minister of Lands & Ors
2004 (1) ZLR 511 (S). The Court cited with approval the case of L
F Boshoff Investments (Pty) Ltd v Cape Town Municipality
1969 (2) SA 256 (C) at 267 A-F, CORBETT J (as he then was) wherein
the court said an applicant for such temporary relief must show:
“(a) that
the right which is the subject matter of the main action and which he
seeks to protect by means of interim relief is clear or, if not
clear, is prima
facie
established though open to some doubt;
(b) that,
if the right is only prima
facie
established, there is a well-grounded apprehension of irreparable
harm to the applicant if the interim relief is not granted and he
ultimately succeeds in establishing his right;
(c) that
the balance of convenience favours the granting of interim relief;
and
(d) that
the applicant has no other satisfactory remedy.”
[23] There
can be no doubt from the above cited authorities that the
requirements to be considered and assessed by a court when faced with
an application for an interim and final interdict are different. The
court a
quo,
in
casu,
however assessed the respondent's application on the requirements
of an application for interim interdict which had not been sought or
motivated by the respondent. The court could not have properly
assessed whether or not the respondent had satisfied the requirements
for an interim interdict as the respondent's founding affidavit was
making a case for a final interdict.
[24] In
Gwaradzimba
N.O. v CJ Petron & Co. (Pty) Ltd
2016 (1) ZLR 28 (S) the Court emphasised the importance for a court
to determine all issues raised before it. The court held that:
“The
position is well settled that a court must not make a determination
on only one of the issues raised by the parties and say nothing about
other equally important issues raised 'unless the issue so
determined can put the whole matter to rest' – Longman
Zimbabwe (Pvt) Limited v Midzi & Ors
2008 (1) ZLR 198, 203 D (S).
The
position is also settled that where there is a dispute on some
question of law or fact, there must be a judicial decision or
determination on the issue in dispute. Indeed the failure to resolve
the dispute or give reasons for a determination is a misdirection,
one that vitiates the order given at the end of the trial.”
[25] In
PG
Industries Zimbabwe (Pvt) Ltd. v Bvekerwa & Others
SC53/16 the court held the following:
“The
position is settled that where there is a dispute on a question, be
it on a question of fact or point of law, there must be a judicial
decision on the issue in dispute. The failure to resolve the dispute
vitiates the order given at the end of the proceedings.”
Also,
in Nzara
and Ors v Kashumba N.O. and Ors SC18/18
at page 13 of the cyclostyled judgment held that:
“The
function of a court is to determine the dispute placed before it by
the parties through their pleadings, evidence and submissions. The
pleadings include the prayers of the parties through which they seek
specified orders from the court. This position has become settled in
our law. Each party places before the court a prayer he or she wants
the court to grant in its favour. The Rules of court require that
such an order be specified in the prayer and the draft order.
These
requirements of procedural law seek to ensure that the court is
merely determining issues placed before it by the parties and not
going on a frolic of its own. The court must always be seen to be
impartial and applying the law to facts presented to it by the
parties in determining the parties' issues.”
[26] From
the above referred authorities it is clear that this Court has
pronounced itself on the importance of a courts to be guided by the
papers and pleadings placed before them. A court must neither stray
from the issue it is asked to determine nor must it create an issue
for the parties. It must not go on a frolic of its own.
[27] In
casu,
the respondent placed before the court a
quo
an application for a final order. The draft order sought clearly
showed that the respondent was seeking a final interdict as per para
1 of the draft order for the sharing of the rentals which had been
collected since 2014 to 2018 in terms of the partnership agreement.
Paragraph 2 was more of an interim relief which sought to prohibit
the appellants from interfering in the management of the properties
pending the outcome of the appeal which had been filed under
SC351/19.
[28] The
court a
quo
thus grossly misdirected itself in granting the draft order on the
basis of the requirements of an interim interdict which had not been
motivated by the respondent. The court a
quo
ought to have been guided by the papers placed before it by the
parties before making its determination on the application which was
being sought by the respondent. The respondent made an application
for a final interdict and went on to motivate the requirements for
such application. There was no application for an interim interdict
before the court and as such the order granted by the court was
erroneously granted.
[29] The
court finds merit in the arguments made by counsel for the appellant
and on this basis alone the appeal must succeed. The appellants have
succeeded and they are thus entitled to their costs. I am not however
persuaded by the argument that the appellants have made out a case
that justifies that they should have been awarded costs on a legal
practitioner client scale before the court a
quo.
DISPOSITION
[30] In
the result, it is accordingly ordered as follows:
1.
The appeal succeeds with costs.
2.
The judgment of the court a
quo
is set aside and substituted with the following:
“The
application be and is hereby dismissed with costs.”
MAVANGIRA
JA: I
agree
BHUNU
JA: I
agree
Garabga,
Ncube & Partners,
appellants' legal practitioners
Zinyengere
& Rupapa,
respondent's legal practitioners
