MAKARAU JP: The facts
giving rise to this application are largely common cause. They are as
follows.
The applicant is in the farming business, operating a farm in
Chakari. In October 2006, it set out to acquire a centre pivot
irrigation system for its farm. Its Managing Director, duly
authorized to act on behalf of the applicant, approached one Douglas
Chihuri, (“Chihuri”), who was selling a center pivot system on
behalf of the respondent.
An agreement of sale was concluded between the plaintiff and Chihuri,
acting for his principal, regarding a 140HA center pivot system
belonging to the respondent.
A purchase price in the sum of $12,000,000-00 and installation
charges of $3,000,000 were agreed upon.
Pursuant to the agreement, an invoice was made out to the applicant
giving the total amount payable as $15 million.
It was made clear to Chihuri that payment would be made through the
African Banking Corporation and would take a few weeks to be
processed.
A month later payment was effected in the agreed sum. This was made
in favour of Chartered Enterprises, Chihuri's trading mantle.
A week after payment had been made, the applicant met with the
respondent to discuss the details of the delivery of the centre
pivot. Chihuri was in attendance. At the meeting, the respondent
unilaterally increased the purchase price of the centre pivot.
Instead of holding the respondent to the agreed price, the applicant
agreed to pay an additional $5million and executed an acknowledgement
of debt to this effect.
The seller also appended his signature to the acknowledgement. So did
Chihuri.
Payment of the $15 million was then made to the respondent according
to his instructions. Still acting as the seller's agent, Chihuri
agreed to have the centre pivot delivered to the applicant.
The respondent did not deliver the centre pivot, prompting the
applicant to bring this application seeking an order compelling the
respondent to deliver a 140HA center pivot to it.
In opposing the application, the respondent denies knowledge of what
transpired between the applicant and Chihuri, but admits that he was
at that time selling two centre pivots, the details of which he gave
to Chihuri. He further confirmed that in time Chihuri advised him
that he had secured a buyer for one of the centre pivots. He also
confirmed that he received the sum of $14 million dollars for the
centre pivot that Chihuri had sold to the applicant on his behalf and
that a balance in the sum of $5 million would be paid in due course.
It was also suggested to him that a further $15 million would be paid
for the same pivot after the applicant had sold his beasts or that he
could collect the beasts himself as further payment for the sold
pivot. He however opted for a cash payment. He did not agree to the
delivery of the pivot in the absence of full payment and did not
deliver the center pivot because he did not receive the full purchase
price of $35 million.
At the hearing of the application, it emerged that the respondent had
sold the centre pivot, the subject of this dispute after being served
with this application but before the matter was determined.
This emerged from supplementary affidavits filed by both parties days
before the hearing and which were filed with my leave. I granted
leave to the parties to file the supplementary affidavits as in my
view, they air the full dispute between the parties and bring out the
real issue for determination in this matter.
In his supplementary affidavit, the respondent deposed that after the
filing of the above application, a director of the applicant caused
his arrest on allegations of fraud. It was alleged in the criminal
proceedings that the respondent had fraudulently misrepresented to
the said director that the centre pivot was available for sale when
he knew that it was not as it was to be sold to a third party. The
respondent was duly prosecuted but was acquitted at the close of the
trial.
In it own supplementary affidavit, the applicant admitted the facts
given in the respondent's additional affidavit but urged me to find
the contents of the affidavit inadmissible on the basis of irelevacy.
Before proceeding further, I will dispose of the admissibility of the
contents of the affidavit.
In my view, once a court grants leave to a party to file an
additional affidavit, that grant of leave necessarily implies that
the contents of the affidavit are admissible. Supplementary
affidavits should only be filed if their contents are relevant to the
dispute before the court.
It is a general rule of evidence that irrelevant evidence is
inadmissible.
Section 26 of the Civil Evidence Act [Chapter 8.01] provides that
evidence that is irrelevant or immaterial and cannot lead to the
proving or disproving of any point in issue shall not be admissible.
This section is simply a codification of the position at common law
which holds that all facts relevant to the issue in legal proceedings
may be proved and where a legally recognized exception to this rule
is not invoked, relevancy remains the fundamental rule governing the
admissibility of evidence.
As indicated above, this is the rule that a court summarily employs
before granting leave to file additional affidavits in motion
proceedings.
In my view, the rule against admissibility of irrelevant evidence is
rooted more in common sense than in a legal principle. It is a common
sense approach by the court to govern that which it will accept or
reject lest it be inundated by evidence of all facts surrounding a
dispute and trials will take longer than is necessary to resolve if
the parties were left at liberty to drag in all they wish or think is
necessary.
It however remains clear that the rule against irrelevant evidence is
against evidence of facts that have little to do with the issue in
dispute.
In casu,
I was of the view that the disposal of the centre pivot pending
litigation is the issue in dispute and thus facts tending to prove
the disposal cannot be irrelevant. Further and in any event, the
facts sought to be rendered inadmissible by the applicant are common
cause and thus no party will be prejudiced by its admission into
evidence.
It is on the basis of the above that I ruled admissible the contents
of the two supplementary affidavits.
I now turn to consider the merits of the application.
The issues that fall for determination in this application are mainly
two in my view.
(i) Firstly, I have to determine
whether or not there was an agreement between the applicant and the
respondent for the sale of the centre pivot for $20 million.
The respondent has sought to argue that the agreed purchase price was
$35 million. He deposed in his opposing affidavit that after the
applicant had paid the first $15 million and had promised a further
$5 million by way of the acknowledgement of debt, the parties agreed
to a further payment of $15 million after the applicant had sold its
beasts.
Relying on these averments by the
respondent Mr Debwe
argued that the correct purchase price of the center pivot cannot in
the circumstances be ascertained without the leading of oral evidence
and thus the application should fail on this basis.
It is common cause that Chihuri, acting as the agent of the
respondent agreed to sell the centre pivot to the applicant for $15
million. The parties agreed later to vary the purchase price to $20
million when after making payment of the initial purchase price, the
applicant promised by way of an acknowledgement of debt to pay an
additional $5 million.
The agency Chihuri to represent the respondent, whilst challenged in
the opposing affidavit, was not advanced in argument.
In my view, Mr Debwe was well advised not to advance the argument in
view of the affidavit by Chihuri and the fact that respondent
accepted the sum of $15 million paid by the applicant through
Chihuri.
By his own conduct of accepting the payment, the respondent put paid
to whatever argument he may have had against the agency of Chihuri.
By this conduct, he gave out and confirmed that Chihuri was indeed
selling the centre pivot on his behalf and is thus bound not only by
what Chihuri did but by what he also personally did.
If there was any doubt about the agency of Chihuri, the respondent
personally removed that doubt by accepting the part payment of the
purchase price and agreeing with the applicant that the balance now
stood at $5 million, thereby putting beyond doubt that the purchase
price was $20 million.
In my view he is thus condemned by his own actions as revealed by the
papers filed of record.
I am aware that the respondent has repeatedly and vehemently denied
in his affidavit that the purchase price of the centre pivot was $20
million.
It is my view that it is not the
number of times a denial is made or the vehemence with which a denial
is made that will create a conflict of fact such as was referred to
by MCNALLY J (as he then was) in Masukusa
v National Foods Ltd and Another
1983 (1) ZLR 232 (H) and in all the other cases that have followed.
A material dispute of fact arises when material facts alleged by the
applicant are disputed and traversed by the respondent in such a
manner as to leave the court with no ready answer to the dispute
between the parties in the absence of further evidence.
In casu,
I believe the papers filed of record present ready answers to the
questions posed by the respondent. He argues that he wanted more than
the $20 million that the applicant contends was the agreed purchase
price.
(i) Firstly, the papers filed of
record clearly show that the respondent's agent negotiated and
agreed to the sum of $20 million.
At law, the actions of the agent bind the principal even if the agent
is breaching his own contract of agency with the principal. There is
thus no need to lead evidence to show what the terms of the agency
contract were regarding the purchase price he had to seek. The
respondent, through the agency of Chihuri agreed to $20 million that
the applicant has paid in full.
(ii) Secondly, it is common cause
that the respondent received the sum of $15 million dollars through
his agent and thereafter acknowledged in writing that the balance due
was $5 million. He did not at that stage query the fact that the
balance was only $5 million instead of $20 million according to his
assertions.
By appending his signature to the acknowledgement of debt which
clearly indicates the balance as $5million he gave out to the
applicant that he agreed with the applicant tin this regard.
Thus in my view, on the basis of the papers, it is clear that the
total purchase price agreed to between parties was in the sum of $20
million which was paid in full.
I find nothing on the papers to indicate that the parties may have
agreed to a price other than $20 million.
The only suggestion that this may be so is the averment by the
respondent in his opposing affidavit to this effect. It is not backed
up by any other evidence. It is contradicted by the facts that are
common cause and is thus clearly simply meant to introduce an
illusory conflict where none exists.
Aligned to the alleged conflict of fact on the agreed purchase price
is whether the respondent agreed to deliver the centre pivot before
payment of the purchase price in full.
Again Mr
Debwe urged me to find
that I could not resolve this dispute in the absence of oral
evidence.
I am afraid I cannot agree.
Having found that the agreed purchase price was $20 million which was
paid in full, it matters not in my view if the respondent agreed to
deliver the centre pivot as delivery is a legal consequence following
the conclusion of a sale agreement. It cannot be the subject of a
separate agreement between the parties.
It is therefore my finding that there is no material conflict of fact
in this application.
The parties concluded an agreement of sale of the centre pivot for
the sum of $20 million which has since been paid in full. The
respondent is bound by the law of sale to deliver the centre pivot to
the applicant.
Having disposed of the first issue, I now turn to the second issue.
It concerns the relief that the applicant is entitled to in the
circumstances of this matter.
It is common cause that the centre pivot that that the respondent
sold to the applicant has since been sold to a third party. It is
also common cause that the respondent sold the centre pivot whilst
fully aware that this application had not yet been determined and
thereby sought to render the outcome of the litigation ineffective by
disposing of the subject matter of the suit before hand.
I find the conduct of the respondent in this regard a mockery of this
court and its proceedings.
It was not put in issue by the
respondent that the centre pivot was not res
litigiosa at the time
that he sold it to a third party. I will therefore proceed to deal
with the matter on the basis that it was.
In doing so I am aware that there
is a possible distinction as to when the subject matter of litigation
becomes res litigiosa
depending on whether the suit before the court concerning the object
is an action in rem or
a personal action.
The authorities seem to suggest
that in an action in rem,
the subject matter becomes res
litigiosa upon service
of summons whereas in all other actions, the subject matter becomes
res litigiosa
upon litis contestatio
or the closure of pleadings. (See Opera
House (Grand Parade) v Cape Town City Council 1986
(2) SA 656 (CPD) at 659 G-J).
In any event and for the
avoidance of doubt, although the applicant is suing ex
contractu, to enforce
a personal right against the respondent, at the time the centre pivot
was sold, the parties had filed both the application and the opposing
affidavits and thus the matter had in my opinion reached litis
contestatio and the
application could have at that stage been set down for hearing.
The sale of res
litigiosa has been
dealt with by the courts for decades. The position at law appears
settled. I believe I can do no better than refer to the words of
INNES CJ in Caronel v
Gordon Estate & G.M. Co 1902
T.S. 95 at 101 when he had the following to say:
“Now,
it is undoubtedly the case that under Roman law any right which was
res
litigiosa
could not be alienated. But a thing only became res
litigiosa
when there was an action in rem
concerning it; the doctrine of litigiosity had no place in regard to
merely personal action. Coming to Roman-Dutch law, there is some
authority for the proposition that the same rule
prevailed............... I think then that the weight of Roman-Dutch
law authority does not forbid the alienation of res litigiosa. But
even if the doctrine of litigiosa is to be applied, it would be
necessary to fix some point or stage in process of an action at which
it shall begin to operate. This is desirable and necessary in the
interests of the public who may have dealings with a litigant.
Now
the only point or stage in the process at which to fix the vesting of
this right to prohibit alienation would be litis
contestatio.”
My reading of the above remarks
by INNES CJ is that prior to the right of litigiosity vesting, the
res can be alienated
but after litis
contestio had been
reached, litigiosity operates to prohibit the alienation of the res.
I am fortified in coming to this
conclusion by the further but separate remarks made by BARRY J in
Hall v Howe
1929 TPD 591 where after referring to old Roman-Dutch authorities,
the learned judge held that res
litigiosa could be
alienated provided that if the litigant succeeded in his claim
against the seller, he, the litigant could recover the property in
dispute from the new possessor.
The doctrine was raised recently
in PS Booksellers (Pty)
Ltd And Another v Harrison and Others
2008 (3) SA 633 (C) where MEER J also referred to the old Roman–Dutch
authorities and to Opera
House (Grand Parade) Restaurant (Pty) Ltd v Cape Town City Council
(supra) emphasized the
right of the first buyer to recover the res
from the third party by summary process. In paragraph 107 of his
judgment, he had this to say:
“It
seems to me that, notwithstanding the different phraseology employed
by different sources relating to the safe-guarding of the third
party's interest(s) in the res, extensive concern for such
interest(s) is in each case the same and that there is what may be
accepted as unanimity of this point.
The position is that it is now
generally accepted that despite the fact that a thing is res
litigiosa this does not preclude or prevent it from being alienated
or similarly dealt with, so long as the rights of the non-alienating
litigant in the res are protected . . .
This means - when applied to
the instant case - that respondent, albeit that the Rotunda Hotel
site is res litigiosa, can only be restrained from dealing with it as
it (respondent) proposes doing . . . if applicant's rights in and to
the site, viz as owner in the event that it is restored to it on the
conclusion of the pending action, are not, and will not be,
prejudiced by such dealing.”
While I have not been able to
come across a case in point, from the above authorities I am coming
to the conclusion that after litis
contestaio has been
reached, res litigiosa
cannot be alienated and where it has been alienated the plaintiff, if
successful, can recover it from the possessor.
The old authorities suggest that the non alienating party can
summarily recover the res from the third party.
In Hall v Howe (supra),
the point is made that if successful, the non-alienating plaintiff,
if successful can recover the res by execution from the new
possessor.
The authors Silberberg &
Shoeman, in The Law of Property 3rd
Ed at page 304 put the position lucidly in my view as follows:
“This
means that the sale of a res
litigiosa
is valid inter
partes,
but the purchaser is bound by the judgment in the action and the
successful plaintiff can recover it from the new possessor by
execution and without fresh proccedings”.
In the result, and on the basis of the foregoing, I make the
following order:
1. The applicant is by execution,
to take delivery of the 140HA centre pivot sold to it by the
respondent.
2. The respondent shall bear the
applicant's costs of suit on a legal practitioner and client scale.
Chikumbirike & Associates, applicant's legal
practitioners
Debwe & Partners, respondent's legal practitioners
