Opposed
Application
MUZENDA
J:
The
applicant made an application seeking the following order:
“IT
IS HEREBY ORDERED THAT:
1.
The cancellation of the Memorandum of Agreement of Sale of Stand
No.11234 Darlington Extension, Mutare Township, measuring
approximately 1,1759 hectares, entered into by the City of Mutare and
Washington Jekanyika, jointly together with Cheneso Muvandi, is a
nullity, of no force and effect.
2.
The Memorandum of Agreement of Sale of Stand No.11234 Darlington
Extension, Mutare Township, measuring approximately 1,1759 hectares,
entered into by the City of Mutare and Washington Jekanyika, jointly
together with Cheneso Muvandi, is declared valid.
3.
The 1st
respondent shall pay costs of suit on a higher scale of attorney and
client.”
The
application is opposed by the 1st
respondent, the City of Mutare.
BACKGROUND
On
20 July 2016 Clayhill Trading (Private) Limited entered into an
agreement of sale of a piece of land, namely Stand No.11234
Darlington Extension, Mutare Township, measuring 1,1759 hectares,
with applicant and her late husband Washington Jekanyika.
The
purchase price was US$62,000-00.
Clause
3 of the agreement of sale stipulated the payment plan: US$20,000-00
was payable against the signing of the agreement; US$20,000-00 was
payable 3 weeks after the signing of cession papers. The balance of
US$22,000-00 was going to be liquidated through monthly instalments
of US$4,000-00 commencing 30 September 2016.
The
preamble to the memorandum of agreement of sale between the seller
and buyer provided that the buyers had to demand transfer from the
Municipality of Mutare of such immovable property so purchased by the
buyer, however the seller was responsible for the payment of all
cession costs, including the city council's cession fees and
capital gain tax, if any (clause 8 of the agreement of sale).
During
the same year, 2016, the first respondent, City of Mutare, entered
into an agreement of sale with the applicant and her husband.
Under
clause 2 of this agreement, the purchase price “was the intrinsic
value paid by Clayhill (Pvt) Ltd.”
Clause
14 thereto stipulates that the purchasers shall demand transfer of
the stand from the seller upon completion on the main building.
The
agreement of sale does not state any conditions for breach or grounds
for cancellation of the agreement of sale.
On
24 September 2019 the City of Mutare wrote a letter to the
applicant's legal practitioners indicating that the agreement of
sale between itself, the applicant and her husband had been
cancelled.
First
respondent alleged in the letter the applicant's late husband, Mr
W. Jekanyika had misrepresented to the city council that he had fully
paid the purchase price of the property to the developer, Clayhill
and that Clayhill had since cancelled the first agreement of sale.
As
a result of the “fraud” committed by the purchasers, the first
respondent was cancelling the agreement of sale.
A
lot of correspondences were exchanged between the city council's
legal practitioners and the purchasers lawyers but nothing came out
of the correspondences until the applicant approached this court.
Clayhill
(Pvt) Ltd had since issued summons against the purchasers claiming an
amount of US$28,000-00 for arrear payments.
It
is important to note that there is no allegation nor prayer by
Clayhill for the cancellation of the agreement of sale or a
misrepresentation on the part of the applicant and her late husband.
The
first respondent, in its opposing papers contends that the
applicant's application should fail for failing to join Clayhill
Trading (Private) Limited as a party to the proceedings.
As
already addressed in the foregoing above, the first respondent went
on to state that applicant and her husband breached the terms of
their agreement with Clayhill by failing to pay the full purchase
price and that led to the cancellation of the agreement of sale by
letter of 21 November 2016 written by Clayhill Property Development.
Hence
the agreement of sale between City of Mutare and the applicant and
her husband was a nullity because at the time it was drafted, the
city council did not hold any rights, interest or title in the stand,
instead such rights were vested with Clayhill, and as such the
cancellation of the agreement was above board and before the
cancellation of that agreement, applicant's legal practitioners
were fully appraised of the whole scenario of the events.
To
the respondent the relief being sought by the applicant has no basis.
The
second respondent is an estate of the late Washington Jekanyika. The
executor had notified the registrar of the court that he will abide
by the decision of this court.
Both
applicant and first respondent had raised preliminary points in their
respective papers and I directed the legal practitioners to
holistically address the court by commencing with points in
limine
and then the main issues.
Applicant's
point in
limine
The
applicants on filing her affidavit raised a preliminary point to the
effect that the first respondent's Town Clerk in filing the
opposing affidavit was not authorised by the council. Hence the
application should proceed as unopposed.
The
applicant amplified her argument by submitting that first
respondent's notice of opposition is fatally defective for warrant
of a proper opposing affidavit.
The
Town Clerk, Mr Maligwa, did not attach authority which he alleges to
have to depose to the affidavit.
Mr
Tanaya,
to advance his argument, cited section 136(2) of the Urban Councils
Act [Chapter
29:15]
which basically provides as follows:
“Functions
of town clerk
(1)
The town clerk shall be responsible for -
(a)
the proper administration of the council; and
(b)
managing the operations and property of the council; and
(c)
supervising and controlling the activities of the employees of the
council in the course of their employment.
(2)
For the purposes of subsection (1),the town clerk, in addition to any
other duties that may be assigned to him by the council shall -
(a)……..
(b)
where so authorised by the council, sign orders, notices, or any
document requiring authentication, or execution on behalf of the
council…”
As
such, applicant, contended, the town clerk was required to produce a
resolution on which he relies on not depose to the opposing
affidavit. To the applicant, the town clerk has no automatic
authority to oppose this matter.
First
respondent, in response to this point in
limine
submitted that the absence of the resolution does not prove that the
town clerk did not have authority.
The
town clerk is the chief executive officer of the first respondent and
in charge of the entity including litigation and defending council.
Ms
Gutuza
went on to cite the case of Tian
Ze Tobacco Co. (Pvt) Ltd v Muntuyedwa
and also the matte of Zimbabwe
Open University v Magaramombe and Another.
In
summary the first respondent submitted that the averment in the
deponent's opposing affidavit is adequate and in its view there was
no need to attach the resolution reached by the full council meeting.
Given
the nature of the facts in this application more particularly the
stance adopted by the first respondent towards the application the
applicant's contention holds firm.
It
was incumbent upon the council to deliberate on the facts of this
matter and consider whether there was any basis to oppose the
application brought about by the applicant and also seriously outline
the basis of such opposition.
This
analysis would be dealt with below on the aspect of costs but given
the provisions of section 136(2) I agree with the applicant's
counsel, that there was need for a special resolution passed by the
council mandating the town clerk to depose to an opposing affidavit
on its behalf.
At
the same time, this court will not lose sight of the fact that there
is an opposing affidavit before it which affidavit contains material
documents that are going to be of a great assistance in the
resolution of this application.
It
will be in the interests of justice that I will condone the failure
to file that resolution by the first respondent and allow the first
respondent to be heard on merits.
Applicant's
point in
limine
though
valid is dismissed.
First
Respondent's point in
limine
On
29 October 2019 the first respondent filed its opposing affidavit and
raised a preliminary point to the effect that applicant ought to have
joined Clayhill Trading (Private) Limited from whom applicant
allegedly purchased the stand in dispute.
According
to first respondent Clayhill is still the holder of all rights,
interests and title in the stand and it cancelled the agreement
between it and applicant.
First
respondent added that given the nature of relief being sought by the
applicant, the ultimate order cannot be effectively carried out,
without the involvement of Clayhill.
This
non joinder is fatal to applicant's case.
In
response to the preliminary point raised the applicant contented that
there was no need for the applicant to cite Clayhill because
applicant's course of action arises out of a contract between
applicant, her husband and first respondent, Clayhill is not party to
that agreement. By the doctrine of privity of contract, there is
nothing that affects the company that arises from the four corners of
the agreement.
It
is the council which is the holder of real rights on the property in
question.
The
applicant attached copy of summons commencing action issued by
Clayhill against the late Washington Jekanyika and the applicant;
where Clayhill is claiming US$28,000-00 being the balance in respect
of immovable property sold by plaintiff to the defendants pursuant to
the agreement of sale.
When
Ms Gutuza
was asked by the court to explain why joinder was necessary, she
submitted that the city council did not want to expose itself to
litigation from Clayhill.
It
is not in dispute that Clayhill has already chosen who and what to
sue for arising out of the agreement of sale relating to stand in
question.
No
one is left to speculate.
Thus
the very fundamental basis relied upon by the first respondent is
palpably answered by the company itself; Clayhill wants to be paid
$28,000-00 by applicant not by the first respondent.
In
light of this positive development, there is virtually no need to
have a joinder where the company has expressly shown that its
interest is in the recovery of the balance of the purchase price not
recovery of the stand for reallocation.
The
point in
limine
by the first respondent has no merit and it is dismissed.
On
the merits of the application the following issues are uncontroverted
in my respectful view:
(1)
Applicant and her husband, the late Washington Jekanyika purchased
Stand No.11234 Darlington Extension, Mutare for $62,000-00, paid cash
of $20,000-00 upon signing of the agreement of sale and from the
calculation between the cost price and balance being claimed on the
summons alluded to above, it is clear that the applicant paid another
instalment of $14,000-00, to make a total of US$34,000-00.
(2)
At the agreement of sale between Clayhill and the applicant another
agreement of sale was concluded between City of Mutare, applicant and
the late W. Jekanyika.
(3)
The applicant took occupation of the purchased stand and started to
develop it.
(4)
The selling company is suing the applicant for an amount of
$28,000-00 as balance outstanding. The company (Clayhill) is not
praying for the cancellation of the agreement of sale on grounds of
fraudulent misrepresentation not for the cancellation of sale between
the City of Mutare and the purchaser.
(5)
In terms of the agreement of sale concluded between applicant and
City of Mutare (first respondent) there is virtually no clause
pertaining to which conditions would justify cancellation of the
contract concluded between the parties. Though not addressed by the
parties, it appears the first respondent was paid by the developer
before the developer (Clayhill) was allowed to offer such stands for
sale to the public.
(6)
City of Mutare remained the title holder both for purposes of cession
or transfer that is why the second agreement of sale between
applicant and the first respondent had to be drafted.
Transfer
of ownership between City of Mutare and applicant would only be
processed after the property had been fully developed.
All
these aspects are common cause and this court asked the first
respondent its basis for opposing the application.
If
Clayhill is fully paid the balance, it means the matter between it
and applicant would have been resolved, and by necessary implication
the subject stand has to remain with the applicant and the estate of
her husband.
After
going through the opposing papers filed on behalf of the first
respondent, it is apparent that the first respondent, mero
motu
proceeded to cancel the agreement of sale it had entered into with
the purchaser without having heard from them.
That
was not proper.
As
long as the administrative authority is involved in making such
decisions, it is required to comply with the dictates of
administrative justice, that requirement applies even when the first
respondent was acting in terms of a contract.
The
first respondent was duty bound to hear the applicant and her husband
first and even ask them to reduce their response in writing.
No
such evidence was produced by the first respondent.
Hence
cancellation of the agreement was arbitrary and cannot be allowed to
stand.
The
first respondent also contended that what prompted her to cancel the
agreement was that the late Washington Jekanyika fraudulently did not
disclose that he had not fully paid the purchase price to Clayhill.
This
court will not dwell much on this issue simply because the first
respondent stated that it learnt this from Clayhill and as already
covered hereinabove the summons issued by Clayhill do not allude to
any fraud on the part of W. Jekanyika; what Clayhill needs is its
payment of the balance of $28,000-00.
In
any case fraud should not only be pleaded but must be established by
way of tangible evidence.
I
am hence satisfied that the first respondent failed to justify its
cancellation of the agreement of sale with applicant and her husband
on a balance of probabilities; there is no condition which could have
been relied upon in the agreement of sale, which if breached by the
purchasers could have justified the cancellation of such a contract.
Costs
The
applicant prayed for costs on a punitive scale of attorney-client.
A
lot of correspondence between the first respondent's office and
applicant's legal practitioners exchanged hands, including
documents pertaining to the matter more particularly the summons
issued by the developer Clayhill where it was claiming $28,000-00
from the purchasers.
Surely
at that stage of proceedings and letter written by applicant's
lawyers to first respondent about that, should have caused the first
respondent to reconsider its stance about the application.
It
did not.
Even
after heads of argument were filed and served on the first respondent
it persisted with the opposition of the application.
The
court is aware that any order of costs adversely affect the rate
payer but the aptitude of the first respondent's action clerk
exhibits a nonchalant attitude bordering on recklessness and abuse of
court process all done in the name of public entity whose resources
should better be ploughed towards service delivery than defending
indefensible, unilateral and unjust conduct by its officials.
This
judgment must be brought to the attention of the Mayor and
councillors to censure in strongest terms the behaviour of the town
clerk.
In
future legal costs of this type should be met by the city official
personally, however in this case the first respondent stated that he
was authorised to oppose the matter by the council so the
council/public entity will be ordered to pay applicant's wasted
legal costs.
As
a result the following order is granted:
1.
The cancellation of the Memorandum of Agreement of Sale of Stand
11234 Darlington Extension, Mutare Township, measuring 1,1759
hectares, entered into by City of Mutare and Washington Jekanyika
jointly together with Cheneso Muvandi is a nullity, on no force.
2.
The Memorandum of Agreement of Sale of Stand No.11234 Darlington
Extension, Mutare Township, measuring approximately 1,1759 hectares,
entered into by the City of Mutare and Washington Jekanyika, jointly
together with Cheneso Muvandi, is declared valid.
3.
The 1st
respondent to pay respondent's costs on attorney-client scale.
Tanaya
Law Firm, applicant's
legal practitioners
Bere
Brothers,
1st
respondent's legal practitioners
Mativenga
Nkomo Legal Practice,
2nd
respondent's legal practitioners
1.
HH626/15 per Mathonsi J (as he then was)
2.
3.
See U-Tow Trailers (Pvt) Ltd v City of Harare and Another 2009 (2)
ZLR 259 (H) per Makarau JP (as she then was)
4.
U-Tow Trailers (supra)
on p268A-B
5.
Muzondo and Others v Usayiwevanhu and Others HH107/12; SPF
& Anor v LBCCT/ALB & Anor 26492/13 [2016] ZAG PPHC 378;
Chikwanira v Mutonhora & Anor HH224/16; Mkandla
& Anor v Ncube & Anor HB93/14
6.
See Binza v Acting Director of Works & Anor 1998 (2) ZLR 364 (H)
