The plaintiff's claim was for specific performance of an agreement of sale for the cession of personal rights and interests held jointly by the first defendant and second defendant in a property known as 5706 Muroro Crescent, Glen Norah B, Harare.The plaintiff asserted that he entered into the agreement with ...
The plaintiff's claim was for specific performance of an agreement of sale for the cession of personal rights and interests held jointly by the first defendant and second defendant in a property known as 5706 Muroro Crescent, Glen Norah B, Harare.
The plaintiff asserted that he entered into the agreement with the first and second defendants on the other hand through the agency of PMA Real Estate Agency (Pvt) Ltd.
The first defendant denied that he ever entered into an agreement of sale with the plaintiff. He denied authorising PMA Real Estate Agency to sell his rights and interests in House No.5706 Muroro Crescent Glen Norah B, Harare.
The first defendant, Zondai Chimbwanda, and the second defendant, Givemore Karimazondo, are joint holders of certain personal rights and interests in the property known as No.5706 Muroro Crescent, Glen Norah B, Harare in equal shares. As holders of equal shares in the said property they agreed between themselves to dispose of their rights and interests in the property. Pursuant to this understanding, the second defendant approached PMA Real Estate and granted them a mandate to sell the said rights and interests.
At the material time, the first respondent was out of the country in Botswana.
In completing the mandate to sell form, the second defendant endorsed both the first and second defendants names as holders of rights and interests in the property.
That form was however signed by the second defendant only.
PMA Real Estate Agency proceeded to advertise the property and the plaintiff expressed interest. On 16 August 2005, the plaintiff executed an irrevocable offer and acceptance form in which he offered a purchase price of $220 million. On 17 August 2005, the second defendant appended his signature to that form in acceptance of the offer as seller.
Thereafter, on 18 August 2005, an agreement of sale was drawn up by PMA Real Estate Agency. The agreement of sale was executed by the plaintiff and the second defendant.
The plaintiff paid a deposit of $214 million to PMA Real Estate and the balance was to be paid in instalments.
The purchase price was subsequently revised upwards to Z$260 million.
The plaintiff paid the balance of the purchase price to PMA Real Estate Agency. The agreement of sale was amended to reflect the new purchase price of Z$260 million (see exb. 5).
It is common cause that when the parties entered into the agreement of sale they knew that the agreement was conditional on the first defendant ratifying the agreement upon his return from Botswana.
The first and second defendants subsequently sold the same rights and interests in the property in question to the third defendant, in September 2005, for the price of Z$350 million.
The third defendant duly paid the purchase price and has since taken occupation of the property.
His effort at obtaining cession was stalled when PMA Real Estate Agency advised the fourth respondent that the same property had been sold to the plaintiff and so no cession should be effected.
The plaintiff therefore brought this suit against the first and second defendants seeking:-
(1) Cession of Stand No.5706 Muroro Crescent, Glen Norah B, Harare into his name, alternatively;
(2) The sum of Z$15 billion being the cost of a house similar to Stand 5706, as at the date of the summons, being 14 November 2007.
The first defendant denied that he had ever agreed to the purchase price purportedly paid to PMA Real Estate by the plaintiff and he also contended that he never ratified the agreement of sale.
The second defendant, in his plea, conceded that he had entered into that agreement conditional on the first defendant ratifying it.
The issues for determination were essentially three, namely:-
(1) Whether there was a binding agreement of sale between the plaintiff and first and second defendants or not;
(2) If the answer to the above is in the affirmative, whether the third defendant was himself an innocent third party purchaser.
(3) If so, who between the two purchasers has dominant rights over the property in dispute.
It is pertinent to note that a conditional sale can only be valid/binding where the condition precedent has been fulfilled.
It is the fulfilment of the condition that gives life to such an agreement.
In casu, the plaintiff and PMA Real Estate were made aware that whatever they were entering into with the second defendant was conditional upon the second defendant ratifying such agreement.
In this regard, it may be noted that ratification is the act of adopting a contract or other transaction by a person who was not bound by it originally: see Osborne's Concise Law Dictionary, 6th Edition, by J. BURKE.
The prerequisite of ratification may be stated as follows:-
“1. The contract must be professedly made on behalf of the principal.
2. There must be a competent principal at the time of the contract.
3. The contract must not be void.
See CHESHIRE, FIFOOT and FURMSTAN's Law of Contract, 11th Edition…,.
Ratification may be express or tacit. Ratification may be implied from an act or conduct showing an interest to adopt the contract.
In casu, the plaintiff alleged that the first defendant ratified the agreement of sale that had been entered on his behalf as joint-holder of rights and interest by the second defendant.
In support of his case, the plaintiff gave evidence and called two witnesses from PMA Real Estate Agency, namely, Simon Mukondo and Jerry Ndemera.
The first defendant gave evidence. The second defendant did not avail himself for trial though he had participated in the proceedings up to the pre-trial conference stage.
In his evidence, the plaintiff alluded to the fact that he himself never came into contact with the first defendant. His assertion that the first defendant ratified the agreement of sale was based on reports he received from PMA Real Estate Agency. He thus could not vouch for certainty that the first defendant, either by word of mouth or in writing, ratified the agreement.
All the documentary exhibits he tendered in support of his case did not have the first defendant's signature.
The conduct that he could only refer to was again based on reports he received from PMA Real Estate that the first defendant had given his consent to the agreement of sale subject to an upward increase in the purchase price.
He had no direct evidence of the first defendant ratifying the Agreement of Sale.
Mr Simon Mukondo gave evidence next. He is a co-shareholder in PMA Real Estate Agency. He is also the Principal Registered Agent of PMA Real Estate Agency.
His evidence was to the effect that PMA Real Estate Agency was given mandate to sell by the second defendant. The second defendant had made it clear the rights and interests were jointly held. That mandate to sell was signed by the second defendant as seller. The co-holder of rights and interests, the first defendant, did not sign the mandate to sell and did not, in his own right, give such mandate.
The second defendant did not provide a power of attorney, or some other written authority, from the first defendant, for him to dispose the first defendant's rights and interests in the property in question.
Despite this omission, PMA Real Estate Agency proceeded to advertise and sell the rights and interests as instructed by the second defendant. This, PMA Real Estate did on the second defendant's word that he had such mandate and that the first defendant would ratify the agreement of sale upon his return from Botswana.
The agreement of sale was executed on 18 August 2005.
It was Mr Mukondo's evidence that on the next day after execution, Mr Jerry Ndemera and the second defendant approached him in his office. They advised him that the two of them had been in touch with the first defendant on the phone who was still in Botswana. They advised that the first defendant had dictated terms for them to re-do the agreement. They had the dictated terms on a piece of paper. That piece of paper was tendered into evidence as part of the plaintiff's bundle of documents. The document in question is on page 7 of the said bundle. The terms on the document were that:
1. That the selling price should be increased to Z$260 million;
2. That the payment would be strictly cash of Z$220 million and balance of Z$40 million would be paid in two instalments in the months of September and October; and
3. That the seller who was present tenant would vacate when schools calendar for 3rd term 2005 ended;
4. The last point was that once the last payment was done, in October, the seller would become a tenant paying rent.
As at that stage, when these terms were brought to his attention, Mr Mukondo had not seen or spoken to the first defendant.
Mr Mukondo said that he saw the first defendant for the first time when the first defendant came with the second defendant in the company of a woman he thought/believed was the first defendant's wife.
When this trio came, the first defendant demanded to be paid the purchase price. They refused to release the money to him contending that they could not do so before cession. The first defendant had then offered that cession be done that same day but this was not done. The first defendant had then said that if he was not paid on that day then the purchase price would go up.
The first defendant was not made to sign the Agreement of Sale or any other document relating to the Agreement of Sale of his rights and interests in the property in question.
The next witness was Mr Jerry Ndemera. At the material time he was employed by PMA Real Estate Agency as Sales Manager.
In his evidence, Mr Ndemera confirmed that PMA Real Estate Agency dealt with the second defendant upon the second defendant's word that he had the mandate to sell from the co-holder of rights and interests in the property.
There was no request or insistence on the second defendant furnishing the requisite power of attorney or and other written authority from the first defendant.
PMA Real Estate Agency were spurred to act simply on the second defendant's assurance.
It was not till after the Agreement of Sale had been concluded that he saw the first defendant.
On his first meeting with the first defendant, the first defendant did not agree with what had been entered into. According to Mr Ndemera, the first defendant came to see him on the day page 7 of the plaintiff's bundle of documents was written.
Mr Ndemera contradicted Mr Mukondo's evidence on how this document came to be.
His evidence was to the effect that this document was written by the first defendant on the day the first defendant came to their offices. He is the one who in fact provided the first defendant with the piece of paper to write on when the first defendant indicated there were some terms to be changed.
The contradiction was in that Mr Mukondo had said Mr Ndemera had indicated to him that the first defendant had dictated those terms on the phone from Botswana and not that the first defendant had come to their offices.
Despite Mr Ndemera's contention that this document was written by the first defendant, he was unable to explain why the first defendant did not append his signature thereto. Instead, the signature thereon is that of Mr Ndemera, just as he had signed for the second seller in exhibit. 1, the Agreement of Sale.
If indeed the first defendant had, on this occasion, ratified the Agreement of Sale, albeit with an increased purchase price and additional terms, he would at least have signed on this document to signify his approval of the transaction, if those terms were accepted by the plaintiff.
It was Mr Ndemera's evidence that the first defendant must have come to their offices on 2 or 3 times. Somehow, he was not made to sign the Agreement of Sale which the plaintiff says he had ratified.
It may also be noted that both Mr Mukondo and Mr Ndemera indicated that when the first defendant came to PMA Real Estate offices he demanded payment. When asked to sign the Agreement of Sale, the first defendant said he wanted to be paid before he could sign.
This, in my view, is inconsistent with a party who had ratified the agreement and had assumed his obligations as contained in the Agreement of Sale.
Further, both Mr Mukondo and Mr Ndemera admitted, that, when the first defendant came in the company of his wife, this was after a PMA Real Estate employee had been to the first defendant's residence with an armed police officer. At that residence, they had forced the first defendant's mother to append her signature to a document tendered in as exhibit. 8.
That document invited the first and second defendants to come and activate the process of transfer.
The visit by the first defendant and his wife was therefore to complain about that visit by a PMA Real Estate employee and the armed police officer. This is the visit Mr Mukondo apparently recalled.
It is clear to me, that, though the first defendant visited PMA Real Estate Agency offices he never signed the Agreement of Sale or any document showing that he consented to the sale of his rights and interests in the property in question.
He never ratified the Agreement of Sale in writing.
The tacit ratification that Mr Mukondo and Mr Ndemera alluded to needed to be proved.
The conflict in the evidence of Mr Mukondo and Mr Ndemera, as key witnesses to the issue of ratification, on such aspects as who authored the document on page 7 of the plaintiff's bundle of documents, the number of visits made by the first defendant to PMA Real Agency, and the fact of a PMA Real Estate Agency employee visiting the first defendant's residence in the company of an armed police officer to force matters, creates doubt on the credibility of their testimony.
They did not impress me as reliable witnesses.
They may have had cause to believe the second defendant when he told them that he had the first defendant's mandate to sell and that the first defendant would ratify the Agreement of Sale, but, that was not adequate. They ought to have obtained consent or mandate from the first defendant himself to proceed with the sale.
They could easily have demanded that the second defendant furnishes them with a Power of Attorney for them to action the second defendant's mandate to sell.
Equally, when the first defendant availed himself at their offices, they ought to have clarified the issue by ensuring that he ratified the agreement in an unequivocal manner. To seek to rely on tacit ratification or consent to the agreement was always going to be difficult.
The onus is on the plaintiff to prove, on a balance of probabilities, that the first defendant ratified the Agreement of Sale for it to be binding on him.
A careful analysis of the evidence adduced in court on this issue does not show that the plaintiff discharged such onus.
The evidence showed that when the second defendant entered into the Agreement of Sale he made it clear that he was also doing so for and on behalf of his co-holder of rights and title and that the co-holder would have to come and ratify the agreement. The first defendant was a competent co-holder to ratify the agreement had he wanted to. The Agreement of Sale was not void. It was capable of ratification.
The failure is on the fact that the plaintiff has not proved, on a balance of probabilities, that the first defendant adopted the agreement of sale.
As the Agreement of Sale was conditional upon the first defendant's ratification, it follows that there was no valid agreement of sale to bind the first defendant.
In the circumstances, the first defendant was free to enter into a sale agreement with anyone that the joint holders of rights and interests in the property preferred.
In this case, they sold their rights and interests to the third defendant. There was no legal impediment to such a transaction.
The plaintiff's remedy, if at all he felt hard done, is against those who led him to part with his money when the agreement had not been ratified.
Accordingly, the plaintiff's claim is hereby dismissed with costs.