MALABA
DCJ:
This is an appeal against the judgment of the High Court dated the 5
January 2012 by which a claim by the appellant against the respondent
for payment of money for goods delivered as per contract was
dismissed following the upholding of a special plea in abatement.
The
grounds of appeal allege a misdirection on the part of the court a
quo
in accepting the allegations placed before it as a special plea.
The
brief background to the dispute is that the appellants issued summons
against the respondent in the High Court on 14 July 2009 claiming
payment of a sum of ZAR4,627,863-93 for goods manufactured and
delivered at the respondent's specific instance and request in
March 2008.
The
appellants alleged that the respondent authorized one Eddie Cross and
Simon Spooner to enter into an oral agreement with them, in terms of
which the order for the manufacture of the goods was placed.
They
alleged that in performance of the contract the goods comprising of
T-shirts, wraps, and headscarves, which the respondent wanted to use
for its election campaign in the June 2008 presidential election
campaign were manufactured and delivered.
In
the main plea the respondent denied any knowledge of the alleged
contract with the appellant. It denied entering into or authorising
anyone to enter into the alleged contract with the appellant. It
denied purchasing or receiving any of the goods.
Therefore
the matter went to trial, but before trial commenced the respondent
filed a special plea in bar on 30 November 2009. The contents of the
plea were as follows:
“The
Defendant pleads in bar of the Plaintiffs' claims as amended as
follows:
1.
The Defendant denies that it is obligated to the plaintiffs either in
contract or in delict.
2.
The defendant is a political association with its headquarters in
Zimbabwe accordingly it is a Zimbabwean based association.
3.
The contract alleged by plaintiffs would have been tainted with
illegality for want of compliance with the Exchange Control Act [Cap.
22:05] as read with the Exchange Control Regulations, 1996 contained
in Statutory Instrument 109 of 1996.
4.
The alleged contract would have required payment to be made by
Defendant to first plaintiff outside Zimbabwe.
5.
The Defendant does not have any free funds nor did it then hold any
money in a foreign currency account.
6.
Accordingly the alleged contract if void for illegality and the
plaintiff's claims ex
contractu
should be dismissed.”
At
the hearing of the special plea the appellants argued that the
allegations made did not meet the requirements of a special plea.
The
learned judge however took the view of the respondent's legal
practitioners and held that the requirements of a special plea had
been met. In upholding the special plea, the learned judge said that:
“The
issue that the defendant raised in this matter is that of illegality.
In that the plaintiffs were attempting to enforce a contract tainted
with illegality for want of compliance in the Exchange Control Act
[Cap. 22:05] as read with the Exchange Control Regulations, 1996
contained in Statutory Instrument 109 of 1996 as the contract would
have required payment to be made by defendant to first plaintiff
outside Zimbabwe.
Ideally
a plea of illegality should be raised before the trial and not in
limine
as stated in Abreu
v Campos
1975 (1) RLR 198 at page 204H-205A. In Adler
v Elliot
1988 (2) ZLR 283 (S) illegality was raised as an exception as it
appeared on the papers. Illegality was also raised as an exception
that the summons disclosed no cause of action in the case of York
Estate Ltd v Wareham
1950 (1) 3A 125 (SR) where the summons had set out the factual basis
that was then used to argue the point of illegality. In Barker
v African Homesteads Touring and Safaris (Pvt) Ltd and Anor
2003 (2) ZLR 6 (S) illegality for contravening section 8 (now section
11) of the Exchange Control Regulations raised in
limine
was upheld both by the High Court and an appeal in the Supreme Court
resulting in the plaintiffs claim being dismissed. Consequently, the
submission by the plaintiffs that illegality should not have been
raised as a special plea and can only be raised on the merits is
clearly untenable.”
The
unanimous view of the court is that the court a
quo
misdirected itself by upholding the special plea on the allegations
that were placed before it.
The
allegations reflected a material dispute of facts arising from the
defendant's plea.
As
a result, the court a
quo
was required to resolve the dispute by the hearing of evidence on
whether or not the denial by the respondent of having entered into a
contract with the appellants was true. If the denial was found to be
substantiated, that would have terminated the action proceedings.
There would be no question of illegality of the contract. The
special plea would not have arisen in the circumstances.
A
special plea is a plea in trial susceptible of a replication and must
be heard separately on the adduction of evidence. Doelcam
v Pitchanik and Ors
1999 1 ZLR 390 (H) 396G-E.
In
this case the court a
quo
did not resolve the dispute of fact on which the special plea was
founded. It determined the issue of illegality of a contract which
one of the parties was denying having entered into. The special plea
was based on speculation of fact of a contract which the respondent
denied entering into.
Mr
Uriri
who appeared for the respondent, conceded that the court misdirected
itself in considering the issue of illegality of the contract which
on the plea, did not concern the respondent without first determining
whether or not as a matter of fact a contractual relationship existed
between the parties.
It
was in light of the clear misdirection by the court a
quo
that it was not found necessary of to hear Mr Fitches
for the appellant. As a result it is ordered as follows:
1.
The appeal succeeds with costs.
2.
The judgment of the court a
quo
is such abide and substituted with the following:
'The
special plea is dismissed with costs'.
3.
The matter is remitted back to the court a
quo
for confirmation of trial.
GOWORA
JA: I agree
OMERJEE
AJA: I agree
Joel
Pincus & Wolhuter
c/o Kantor & Immerman, appellant's legal practitioners
Coghlan
& Welsh c/o Honey & Blackenberg,
respondent's legal practitioners
