Administrative Law re: Administration Fees

HH81-09 : SAFARI OPERATORS ASSOCIATION OF ZIMBABWE vs ZIMBABWE TOURISM AUTHORITY and MINISTER OF ENVIRONMENT AND TOURISM and COMMISSIONER GENERAL OF POLICE
Ruled By: PATEL J

The applicant herein is an association that comprises licensed tour and safari operators and represents their interests. The first respondent is the Zimbabwe Tourism Authority (the Authority) which is established under the Tourism Act [Chapter 14:20] and is primarily responsible for administering that Act.

Towards the end of 2007, the Zimbabwe Tourism Authority (the Authority) issued Circular No. ZTF/1/2007 addressed to all hunting operators to pay a 2% levy on all trophy fees received by them.

The applicant challenges the legality of that directive.

It seeks a declaratur that its members are not liable to pay any levy or surcharge on trophy fees paid by tourist hunters in designated tourist facilities. It also seeks an order restraining the respondents and their employees from taking any coercive action to enforce the levy.

Initially, in its opposing papers, the Zimbabwe Tourism Authority (the Authority) questioned the locus standi of the applicant as well as the propriety of the declaratory order sought by the applicant.

However, at the hearing of this matter, counsel for the Zimbabwe Tourism Authority did not persist with these ancillary issues.

The sole question for determination herein is whether the levying of the 2% surcharge on trophy fees is intra vires the Tourism Act and the Regulations made thereunder.

Tourism Act and Regulations

Section 2 of the Tourism Act [Chapter 14:20] defines a “designated tourist facility” to mean “any service, premises, place, or thing which the Minister has declared to be a designated tourist facility in terms of section thirty-five.”

Under section 35 of the Tourism Act:

“The Minister, after consultation with the Board, may, by statutory instrument, declare that —

(a) Any service whatsoever provided for tourists; or

(b) Any premises or place in or on which a service referred to in paragraph (a) is provided; or

(c) Any premises, place, or thing, whatsoever, which, in the Minister's opinion, affords an amenity to tourists;
shall be a designated tourist facility.”

The declaration of designated tourist facilities by the Minister was effected through the Tourism (Designated Tourist Facilities) (Declaration and Requirements for Registration) Regulations 1996 (SI106 of 1996).

In terms of section 3 of the Tourism (Designated Tourist Facilities) (Declaration and Requirements for Registration) Regulations 1996, S.I.106 of 1996, “the services, premises, or places specified in the First Schedule are declared to be designated tourist facilities.”

Item (c)(ii) of the First Schedule specifically lists as designated tourist facilities:

“services or facilities provided to tourists by…, hunting operators.”

Section 55 of the Tourism Act [Chapter 14:20] enables the fixing of levies and surcharges and provides, in its relevant portions, as follows:

“(1) After consultation with the Minister responsible for finance and the Board, the Minister may make regulations in terms of section fifty-seven prescribing levies to be paid by any class of registered tourist facilities or licensed persons.

(2) In prescribing any levy in terms of subsection (1), the Minister —

(a) Shall prescribe…,.; and

(b) May —

(i) Require any person conducting or operating a registered tourist facility to include in the price of any services rendered by him a surcharge at such rate as may be prescribed, and may require him to collect such surcharge;

(ii) Fix any other basis on which the levy shall be calculated.”

The levy envisaged by section 55 of the Tourism Act is prescribed in the Tourism (Designated Tourist Facilities) (General) Regulations 1996 (SI 107 of 1996).

Section 18 of the (Designated Tourist Facilities) (General) Regulations 1996, S.I.107 of 1996 requires the payment of a levy “in respect of all registered designated tourist facilities.”

Section 19 stipulates that:

“The levy shall be at the rate of 2 per centum of the gross amount, excluding sales tax or any other tax or duty charged to that [sic] tourist making use of any facility provided at the designated tourist facility concerned.”

Section 20(1) makes the operator of every designated tourist facility responsible for the payment and collection of the levy.

By virtue of section 20(2):

“The operator of a designated tourist facility shall add to the charge for accommodating each tourist thereat a surcharge equal to the amount of the levy payable in respect of the tourist concerned.”

Payment of Fees for Trophies

According to the applicant, its members charge their clients the stipulated 2% in respect of all services, facilities, and amenities provided, including hunting operations.

Furthermore, the tourist in question is charged an additional variable amount depending on the size of the animal to be hunted. Where the tourist fails to hunt any animal, he or she is refunded the additional amount paid. If the tourist is successful in hunting the animal, the trophy belongs to him or her exclusively, and the additional amount paid is retained by the hunting operator.

In these circumstances, the applicant's position is that the trophy per se does not constitute a service or facility provided by the operator.

According to the Zimbabwe Tourism Authority (the Authority), the hunting tourist is charged a pre-determined refundable fee for the right to hunt a specified animal, which right forms part of the facilities and services offered by the hunting operator. The trophy charge is not separately invoiced but is added to the daily rate charged to form part of the gross amount realized by the operator for hunting and all other services rendered to the tourist.

In short, the hunting services for which trophy fees are charged cannot be separated from the other services provided by the operator.

Whether Trophy Qualifies as Facility

The central question for determination in casu is this: Does a hunting trophy constitute a “facility” within the meaning of section 35 of the Tourism Act and Statutory Instrument 106 of 1996 so as to attract the levy and surcharge imposed by section 55 of the Tourism Act and Statutory Instrument 107 of 1996?

The word “facility” is defined in Black's Law Dictionary (5th ed.) and in Webster's New Twentieth Century Dictionary (2nd ed.) to mean:

“The easiness of access, the means by which something can be more easily done.”

It is common cause that hunting operations and safaris are facilities as defined in the legislation. It is also not in doubt that the trophy fee paid by a tourist to a hunting operator is a sum paid to be able to hunt through the hunting facilities provided by the operator. It follows, that, a hunting operation affords the means by which the tourist is able to access the trophy.

On this analysis, the trophy is quite clearly an intrinsic and inseparable part of the hunting services afforded by the operator. It cannot, in ordinary usage, be extricated from the service or facility provided by the operator. To do so would be tantamount to pure artifice.

As I perceive it, access to a trophy by a hunting tourist is analogous to the items provided in so-called mini-bars in hotel rooms. The tourist is charged a fixed rate by the hotel for the use of the room, including the mini-bar, as part of the facilities provided by the hotel. The tourist is at large, should he so desire, to consume items from the mini-bar. If he does, he is then required to pay an additional charge for the specific items that he has consumed.

A hunting trophy, in my view, is no different.

If the tourist succeeds in hunting an animal, he must pay the additional charge for his trophy which he has acquired solely by dint of the facility provided by the hunting operator.

It follows from the foregoing that a hunting trophy constitutes a “facility” as envisaged in the Tourism Act and its Regulations and is therefore subject to the levy and surcharge imposed thereunder.

In the result, the applicant is not entitled to the declaratur and interdict that it seeks and this application must be dismissed with costs.

HH485-16 : PUWAYI CHIUTSI LEGAL PRACTITIONERS vs THE REGISTRAR OF THE HIGH COURT and THE TAXING OFFICER
Ruled By: CHIGUMBA J

This application came before me on the unopposed roll for an order that the respondents refund the applicant the sum of USD$4,641=40 and pay costs of suit on a higher scale in the event that they oppose the granting of the order.

A report was filed on behalf of the first respondent in which the court was advised that the respondents would abide by the decision of the court. None of the respondents had any interest in the matter, except that guidance was sought from the court on the correct legal position.

The court dismissed the application with costs and stated that its reasons for so doing would follow. These are the reasons:

On 26 February 2016, a court application for a refund was filed of record, by Mr Puwayi Chiutsi, the applicant's sole partner. He averred that a bill of costs in case number HC7370-11 had been taxed by the second respondent, who had raised a taxing fee of USD$4,641=40. The taxation was subsequently set aside, on review, in case number HC9821-14 on 11 November 2014. The parties resolved the matter and the bill was withdrawn. On 6 January 2015, the applicant wrote a letter to the respondents seeking a refund of the taxing fee because the bill of costs had been set aside on review and the parties had subsequently settled the matter.

The respondents having refused to refund the taxing fee, we have now been asked to guide the parties on the correct legal position.

The issue that arises for determination is whether a taxing fee which was deducted at the instance of the Registrar of this court, by the taxing officer, is refundable in any circumstances, and/or more particularly, in these circumstances where the bill of costs which was taxed was subsequently set aside on review and the parties reached an amicable settlement?

The applicant submitted that the court should be guided by the case of PT Sigauke v ES Muswerakuenda & The Taxing Officer & Deputy Sheriff Harare HC93-053 as authority for the proposition that a taxing fee is refundable.

The respondents' opinion was that a taxing fee is not refundable because its basis is not dependent on execution. They referred the applicant to S.I.426 of 1992 which stipulates that any bill of costs which is taxed by the Registrar or the Taxing Master shall be subject to a taxing fee.

When the matter was initially set down on the unopposed roll, on 27 April 2016, the applicant was directed to serve a copy of its application on the Attorney General. It did so 4 May 2016, and subsequently filed supplementary heads of argument on 10 May 2016 in which it submitted that in terms of section 8 of the State Liabilities Act [Chapter 8:14] the court was precluded from taking any notice of failure to comply with section 6 on its own. At the time that the file came before me, on 18 May 2016, no response had been filed by the Civil Division of the Attorney General's Office.

The taxation of a Bill of Costs is provided for in terms of Order 38 Rule 307 of the Rules of the High Court 1971, as follows:

“ORDER 38 TAXATION OF COSTS AND REVIEW OF TAXATION

307. Costs allowed

With a view to affording the party who has been awarded an order for costs a full indemnity for all costs reasonably incurred by him in relation to his claim or defence and to ensure that all costs shall be borne by the party against whom such order has been awarded, the Taxing Officer shall, on every taxation, allow all such costs, charges, and expenses as appear to him to have been necessary or proper for the attainment of justice or for defending the rights of any party, but save as against the party who incurred the same, no costs shall be allowed which appear to the Taxing Officer to have been incurred or increased through over-caution, negligence, or mistake, or by payment of a special fee to another legal practitioner, or special charges and expenses to witnesses or other persons or by other unusual expenses.”…,.

The Taxing Officer is enjoined to allow all such costs, charges, and expenses as appear to him to have been necessary or proper for the attainment of justice or defending the rights of any party. He must be guided by the tariff of legal practitioner's fees prescribed in the High Court (Fees and Allowances) Rules, regard being had to any amendment to the tariff from time to time; see Order 38 Rule 302.

Section 57 of the High Court Act, 1981 [Chapter 7:06] provides that:

“The Minister may make regulations providing for the fees which shall be payable in respect of instruments, services, or other matters received, issued, provided or otherwise dealt with by the registrar or Sheriff or any other officer to the High Court in the course of his duties or in the office of such office.”

The High Court (Fees) (Civil Cases) Regulations 1992, Statutory Instrument 426 of 1992, were promulgated by the Minister on the basis of the authority given to him to do so by section 57 of the High Court Act. The regulations provided the appropriate fee for all fees in respect of instruments, services or other matters received, issued, provided, or otherwise dealt with by the Registrar or Sheriff or any other officer of the High Court in the course of his duties. The regulations stipulated that any prescribed fee was payable, in peremptory terms. Neither the quantum of the fee or the requirement to pay is discretionary. The schedule set out in S.I.426 of 1992 was substituted by S.I.50 of 2009.

It is common cause that the taxing fee set out in S.I.50 of 2009 (number 8) is USD$20 for each USD$100 allowed or part thereof. There is nothing in these rules which provides for the refund of a taxing fee.

The case of PT Sigauke v ES Muswerakuenda & The Taxing Officer & Deputy Sheriff Harare HC93-053, which the applicant seeks to rely on, concerned an urgent chamber application for stay of execution of a writ of execution that had been issued when judgment was obtained in respect of non-payment of a taxed bill of costs.

My reading of that case is that the court referred to the remedy in its Rules that provided for an application for review of a taxed bill of costs. It expressed its opinion that the applicant could have applied for a review of the bill of costs in terms of the rules, and that, had he done so, the filing of the application for review would have automatically suspended the writ of execution.

The court said that;-

“The taxation was done on the 11th October 2005. A week has since passed, and yet, apart from seeking stay of execution, the applicant has not proffered any evidence that he is pursuing any remedies in terms of the Rules. Had the applicant sought a review of the taxation proceedings, then the review would have acted as an automatic stay of execution.”

Nowhere in that judgment does the court state that the taxing fee is refundable.

For the sake of completeness, the following cases all dealt with the issue of costs, their taxation, the suspension of writs of execution which were issued in respect of taxed bill of costs; ABC Bank Limited v Mackie Diamonds BVA & Anor HH928-15; Tetrad Holdings Ltd v Master of the High Court & 2 Ors HH898-15; Delta Corporation Ltd v ZIMRA HH621-15; Elliot Rodgers v P. Chiutsi HH222-15.

Despite diligent research, I was unable to unearth a single case in which an application of this nature was brought to this court.

The bill of costs which was taxed in case number HC7370-11 was reviewed in case number HC9821-14 on 11 November 2014. According to the applicant's averments in the founding affidavit, the taxation was set aside on review and the parties subsequently agreed to set aside the bill of costs.

None of these averments, in my view, establish a basis on which the taxation fee ought to be refunded to the applicant.

It is clear that the reason why the taxing fee is due and payable is in recognition of the work done by the Registrar of scrutinizing the bill of costs, applying the relevant prescribed rate of fees, allowing or disallowing some items claimed, calculating the amount allowed, and other issues incidental to the setting up of the date of taxation and notice to the parties and so forth. The taxing fee is designed to put a value on the service provided by the Taxing Officer, and, once the service has been provided, the fee must be paid….,.

It is my view that if it was the intention of the legislature that the fee for the Taxing Officer's services be refundable then the regulations, as read with the rules of this court, would have expressly provided for such an eventuality.

If services were rendered in the taxation of the bill of costs, are those services to be provided for free because the bill of costs was set aside or suspended on review?

I think not.

If the order which was granted on review expressly provided for the refund of the taxing fee to the applicant, then such order should have been attached to the application.

As it is, on the papers filed of record, there is no basis on which the court can make a finding that the applicant is entitled to a refund. If the parties withdrew the bill of costs, by consent, surely, their agreement should have provided for the question of the taxing fee.

In the absence of cogent evidence of entitlement to a refund of the taxing fee, through a court order, or some other legal instrument, then the inescapable conclusion is that the fee is not refundable.

It is this court's view that the applicant has failed to establish a legal basis for the refund.

If the prescribed fee for issuing of a summons is USD$5 in terms of item 1 of the High Court (Fees) (Civil Cases) (Amendment) Regulations, 2009 (number 8); in my view, a litigant cannot claim a refund of that fee on the basis that the summons was set aside on review or suspended by agreement, or even that it was withdrawn. That fee is in payment for the services provided by the office that issues the summons, and is payable by each litigant on the issue of the summons. The payment or refund of the fee is not dependent on the success or failure of the litigation.

The same applies to the taxing fee which is prescribed as payment for the services of the Taxing Officer.

Once the services are rendered, the fee becomes due and payable at the prescribed rate, and is not ordinarily refundable. It would be against public policy for monies which constitute revenue which is due to the fiscus to be subject to the vicissitudes of the outcome of litigation. Win or lose, the fee is payable once a bill of costs is taxed.

For the avoidance of doubt, we also hold the view that a litigant wishing to apply for a refund of such a fee is bound to adhere to the provisions of section 6 of the State Liabilities Act [Chapter 8:14] which provides that;-

“6 Notice to be given of intention to institute proceedings against State and officials in respect of certain claims

(1) Subject to this Act, no legal proceedings in respect of any claim for —

(a) Money, whether arising out of contract, delict or otherwise; or

(b)…,.

(i) The State; or

(ii) The President, a Vice-President or any Minister or Deputy Minister in his official capacity; or

(iii) Any officer or employee of the State in his official capacity; unless notice in writing of the intention to bring the claim has been served in accordance with subsection (2) at least sixty days before the institution of the proceedings.”

The Taxing Officer's powers of taxation emanate from the High Court Act, its Rules, and the Regulations which are promulgated by the Minister. Surely, the Minister ought to have been cited as a party to these proceedings. The taxing fee is levied on his authority. It goes into the Government's consolidated coffers.

Any refund of this fee would involve officials of the State.

The State Liabilities Act demands sixty day's notice before the institution of proceedings. This renders this application fatally defective for failure to comply with section 6 of the State Liabilities Act.

It has not been suggested that the Registrar of the High Court and the Taxing Officer benefitted in their personal capacities from the taxing fee. On what basis were they then cited if not in their official capacities as agents of the State?

The State Liabilities Act announces itself to be; 'An Act to impose liabilities upon the State in respect of acts of its employees.'

It follows that the applicant ought to have followed its directives regarding the citation of State officials, and given them the requisite notice. In the event that the State officials are not cited properly, or given the requisite notice, how would an order for the refund of the taxing fee be enforced against them when they are not party to the proceedings?

For these reasons, the application be and is hereby dismissed with costs.

SC52-18 : INNSCOR AFRICA LIMITED and GERIBRAN SERVICES (PRIVATE) LIMITED vs COMPETITION AND TARIFF COMMISSION
Ruled By: MALABA CJ, HLATSHWAYO JA and PATEL JA

This is an appeal against the judgment of the High Court holding that a conglomerate is a “merger” as defined in terms of section 2 of the Competition Act [Chapter 14:28] (“the Act”), and, therefore, notifiable to the respondent in terms of section 3A of the Competition Act if its value exceeded the statutory threshold.

On the date of hearing, a concession was made to the effect that the appeal lacked merit. The parties advanced argument on costs. The Court made the order that the appeal be dismissed with costs.

It became necessary for the Court to give a full judgment on the meaning of section 2 of the Competition Act [Chapter 14:28].

Factual Background

The first appellant is a limited liability company incorporated in terms of law, trading in the food industry. The second appellant is also a limited liability company incorporated in terms of law, trading in motor spares and accessories. The respondent is a body corporate established in terms of section 4 of the Competition Act.

Sometime in 2015, the first appellant acquired a controlling interest in the second appellant. In terms of section 34 of the Competition Act, as read with the Competition (Notifiable Merger Thresholds) Regulations 2002 (S.I.195 of 2002) (“the Regulations”), all mergers in terms of the Competition Act with a value above the threshold value of US$1.2 million had to be notified to the respondent.

The appellants' conglomerate had a value above the prescribed threshold.

The appellants took the view that their union was not notifiable in terms of the Competition Act as read with the Competition (Notifiable Merger Thresholds) Regulations 2002 (S.I. 195/2002) because it was a conglomerate. A conglomerate is a corporation formed by merging unrelated firms. They alleged that a conglomerate was not a merger in terms of the Competition Act. The appellants based their view on an opinion given by an advocate.

The respondent had initially agreed to the position that the appellants' union, being a conglomerate, did not fall within the statutory definition of “merger” and was thus not notifiable. It later took the view that conglomerates were covered by the definition of “merger” in the Competition Act and were required to be notified if their value exceeded the statutory threshold.

The respondent instituted proceedings in the court a quo, seeking an order declaring the conglomerate formed by the appellants notifiable and compelling them to pay fees in terms of section 34A of the Competition Act as read with the Competition (Notifiable Merger Thresholds) Regulations 2002 (S.I.195/2002).

The parties proceeded by way of a case stated in terms of Rule 199 of the High Court Rules, 1971.

The Statement of Agreed Facts presented by the parties was as follows:

“1. The first defendant and the second defendant entered into a conglomerate merger in 2015 through the acquisition by the first defendant of a controlling interest in the second defendant.

2. The first and second defendants are not competitors nor are they customer and supplier.

3. The plaintiff has insisted on notification of the merger between the defendants on the basis that it is covered by the definition of a merger in section 2 of the Competition Act [Chapter 14:28].

4. The defendants insist that a conglomerate merger is not a notifiable merger in terms of section 2 of the Competition Act [Chapter 14:28].”

The legal issue which the parties placed before the court a quo for determination was whether or not the conglomerate formed by the appellants was a merger in terms of the Competition Act.

The determination of the issue depended on the interpretation of the words “or other person” in the definition of “merger” by section 2 of the Competition Act.

The respondent urged the court a quo to apply the literal rule of interpretation in ascertaining the meaning of “merger”, as used in the Competition Act. It contended that the words “or other person” referred to a person falling outside the categories of persons specifically mentioned in the definition.

The appellants urged the court a quo to apply the eiusdem generis or noscitur a sociis rule to ascertain the meaning of the words “or other person”. According to this interpretation, the words “or other person” would refer to a person who shared qualities similar to those falling within the classes of the persons referred to in the definition of “merger”.

The court a quo held that the conglomerate formed by the appellants was a merger in terms of section 2 of the Competition Act. That meant that it was notifiable to the respondent.

The appellants appealed against the decision of the court a quo on the following grounds:

"1. The court a quo erred in law and misdirected itself by holding that the term 'or other person' in the definition of a 'merger', when used in its ordinary grammatical meaning, includes any other person not specified in that definition who acquires a controlling interest in the business of another.

2. The court a quo erred in law and misdirected itself in holding that the effect of the use of the term 'or other person' in the definition of a merger is to extend the definition of a merger to other classes of persons not previously specifically mentioned.

3. The court a quo erred in law and misdirected itself by holding that the term 'or other person' in the definition of merger ought to be interpreted broadly.

4. The court a quo erred in law and misdirected itself in holding that the term 'or other person' in the definition of 'merger' ought not to be interpreted eiusdem generis and noscitur a sociis.

5. The court a quo erred in law and misdirected itself in holding that the application of the eiusdem generis rule would render the term 'or other person' meaningless or result in an absurdity.

6. The court a quo erred in law and misdirected itself in holding that the transaction between the appellants, commonly known as conglomerate merger, was a merger as envisaged by section 2 of the Competition Act.”

The issue for determination was whether or not the court a quo was correct in its interpretation of the definition of “merger” in section 2 of the Competition Act to include a conglomerate.

The Court held that the court a quo adopted the correct interpretation of section 2 of the Competition Act [Chapter 14:28]. The following are the reasons for the decision;

The Appellants' argument

Counsel for the appellants had submitted that a conglomerate did not fall within the definition of a merger in section 2 of the Competition Act. He had argued that in interpreting the words “or other person”, the eiusdem generis rule ought to have been applied by the court a quo.

His argument was basically that the words “or other person” could not be interpreted widely to mean persons outside the class of those mentioned specifically in the definition. He contended that the words “or other person” were intended to extend the definition to cover “persons” in business relationships at the time they merged.

Counsel for the appellants further submitted that the Legislature's insertion of the words “or other person” in the definition of merger in section 2 of the Competition Act was not intended to include a conglomerate or any mergers other than those formed between persons who were in some form of a business relationship. The basis of his argument was that had it been the Legislature's intention to include conglomerates and other unforeseen mergers in the definition, it would have simply defined a merger as the “acquiring of a controlling interest” without specifically mentioning the categories of customer, competitor, and supplier.

Whether or not a conglomerate is included in the definition of merger in terms of section 2 of the Competition Act

Competition in any marketplace, for the production or supply of goods or services, is necessary for achieving economic growth and development. Competition policy is formulated to encourage, improve, and protect the competition process for the benefit of consumers through monitoring and regulating business conduct that is actually or potentially anti-competitive and capable of depriving consumers of the benefits associated with a competitive market.

One of the forms of business conduct which competition policy seeks to monitor and regulate is corporate merger. Corporate mergers are an important tool for effecting corporate restructuring transactions that are necessary for enhancing general efficiency in the market and ensuring business survival especially in harsh economic environments.

However, corporate mergers can sometimes be harmful or potentially harmful to the competitive structure of the market thereby negating the gains of competition.

An effective merger regulatory framework is necessary for the achievement and maintenance of the balance between the promotion of beneficial corporate restructuring transactions on one hand and protection of the competitive process on the other.

There are three types of mergers recognised under competition law - vertical, horizontal, and conglomerate.

Vertical mergers are those mergers that take place between two related companies as in the case of a customer merging with its supplier.

Horizontal mergers are those that take place between companies that are in direct competition with each other.

Conglomerate mergers are those between two or more firms that engage in unrelated business activities with different customer bases. Such entities are not competitors and do not have a customer and supplier relationship.

All the three types of mergers are potentially harmful to competition notwithstanding the fact that conglomerates are not entered into by competitors, suppliers, and customers. Mergers may cause the elimination of effective competition thereby creating dominant companies that have the capacity and potential of engaging in anti-competitive practices detrimental to consumer welfare, such as price increases and poor service delivery.

For the reason that all mergers recognised under competition law have the potential to negatively affect competition in the market, special laws have been designed to regulate mergers.

The Competition Act [Chapter 14:28], Act No.7 of 1996 came into force in 1998. Section 2 of the Act defined a merger as follows:

“'merger' means –

(a) The acquisition of a controlling interest in -

(i) An undertaking involved in the production or distribution of any commodity or service; or

(ii) An asset which is or may be utilised for or in connection with the production or distribution of any commodity;
where the person who acquires the controlling interest already has a controlling interest in any undertaking involved in the production or distribution of the same commodity or service; or

(b) The acquisition of a controlling interest in an undertaking whose business consists wholly or substantially in –

(i) Supplying a commodity or service to the person who acquires the controlling interest; or

(ii) Distributing a commodity or service produced by the person who acquires the controlling interest;”

This definition was clear as to the types of mergers it covered.

Part (a) covered situations where a person acquired a controlling interest in an undertaking producing the same commodity or service (competitors). That was a horizontal merger.

Part (b) covered situations where a person acquired a controlling interest in a supplier of commodities or distributor of services. That was a vertical merger.

The definition was amended in 2001 by Act 29 of 2001. Section 2 of the Competition Act, as amended, now defines a merger as follows:

“'merger' means the direct or indirect acquisition or establishment of a controlling interest by one or more persons in the whole or part of the business of a competitor, supplier, customer or other person whether that controlling interest is achieved as a result of —…,.”…,.

The Legislature's intention, in amending the definition of merger, could not have been to cover the vertical and horizontal mergers only, as originally provided for under the 1996 Act. The addition of the words “or other person” to the substance of the definition was intended to broaden the definition to include mergers between parties who did not fall within or were not sharing any characteristics with those in the categories of competitor, supplier, and customer. The meaning of “merger” was broadened to cover a situation where one or more persons acquired or established a controlling interest in an undertaking not falling within the categories of a competitor, supplier, or customer.

What determines the applicability of the definition of “merger”, for purposes of the Competition Act, is the existence of a controlling interest by one or more persons in the whole or part of the business of another person. The definition is inclusive. In other words, the definition was deliberately widened to include all types of mergers. Without the words “or other person”, the definition of 'merger' would have been exhaustive as it would apply only to businesses or undertakings falling within each of the categories specifically stated. The word “other” describes a person who would not belong to any of the categories of persons specifically mentioned.

The definition of a merger in section 2 of the Competition Act [Chapter 14:28] is similar to the definition of merger in the South African Competition Act 89 of 1998 which reads as follows:

“12.(1) For the purpose of this Chapter, 'merger' means the direct or indirect acquisition or direct or indirect establishment of control by one or more persons over all significant interests in the whole or part of the business of a competitor, supplier, customer or other person whether that control is achieved as a result of -…,.”

Commenting on the definition of merger in the South African Competition Act, David Lewis, the then Chairperson of the Competition Tribunal, in a speech titled The Competition Act 1998 – Merger Regulation, said:

“There are a number of key features of merger regulation under the Act that you should appreciate upfront -

(i) Firstly, it incorporates vertical, horizontal and conglomerate mergers;

(ii) Secondly, it is about acquisition of control and the mechanisms for acquiring control are broadly defined;

(iii) Thirdly, control itself is broadly construed.

In short, the merger definition is inclusive – there are few business combinations that would fall outside of the definition of merger. This contrasts markedly with the previous Act that dealt with horizontal mergers only; that is, mergers between competitors only.”…,.

In interpreting the same provision of the South African Competition Act of 1998, the South African Competition Tribunal, in the case of Bulmer SA (Pty) Ltd v Distillers Corporation (SA) Ltd (1) [2001-2002] CPLR 448 (CT) 464, said the following:

“Section 12 refers to a competitor, supplier, customer or 'other person'. The inclusion of the category of 'other person' considerably widens the ambit beyond the more obvious concerns about horizontal and vertical mergers to include all mergers.”

From the above, it is clear that the South African definition of a merger, similar to the definition of a merger in section 2 of the Competition Act [Chapter 14;28], was held to include other mergers outside the horizontal and vertical mergers mentioned. In the same vein, the respondent's argument that the definition of a merger in the Competition Act is inclusive of mergers other than horizontal and vertical mergers cannot be faulted.

For clarity, however, the South African Competition Act of 1998 has since been amended by Act No.39 of 2000 to specifically include all mergers, but, it is clear from the above authorities that even before that amendment the words “or other person” in the former definition of 'merger' were held to include conglomerate mergers.

Commenting on the interpretation of the words “or other person”, IGNATIOUS NZERO, in an article titled “Is there a gap in the definition of corporate mergers in Zimbabwe's Competition Act? Revisiting the Caledonia Holdings (Africa) Limited/Blanket Mine (1983) (Private) Limited Merger” 2015 78.4 THRHR 589…, stated that:

“The phrase 'or other person' can be construed as a catch all phrase that is meant to capture all other forms of mergers outside those specified as between competitors, suppliers, and customers. If the legislature really intended to maintain a same line of persons, it is submitted that it would have used the word 'and', not 'or'. 'And' means in addition to the list provided, suggesting in addition to competitor, supplier, and customer whereas 'or' suggests a diversion from the list. Thus, the use of 'or' entails that the legislature intended to expand the list to include even those persons outside the specified list. There is nothing in the statute or anywhere else to suggest that such a construction is wrong…,.”

The words “or other person” in this context cannot be interpreted eiusdem generis as advocated by the appellants. The eiusdem generis rule was defined, by the learned author GAIL-MARYSE COCKRAM, The Interpretation of Statutes, 3ed…, as follows:

“Where a list of items which form a genus or class is followed by a general expression, the general expression is, in the absence of a contrary intention in the statute, construed eiusdem generis to include only other things of the same class as the particular words.”

The eiusdem generis rule is not a rule of general application to be applied every time general words follow particular words. The rule would be applicable where a general expression follows a list of items that form a genus. The categories of “customer, supplier, and competitor” do not constitute a list of items that form a genus.

In S v Makandigona 1981 (4) SA 439 (ZAD)…, the court reiterated that:

“It must be remembered that the eiusdem generis rule is only one of many rules of construction; it is not to be invoked automatically whenever general words follow particular words. Thus, Craies on Statute Law 7ed says at 181:

'The eiusdem generis rule is one to be applied with caution and not pushed too far, as in the case of many decisions, which treat it as automatically applicable, and not as being what it is, a mere presumption, in the absence of other indications of the intention of the legislature.'”

At p601 of the article titled “Is there a gap in the definition of corporate mergers in Zimbabwe's Competition Act? Revisiting the Caledonia Holdings (Africa) Limited/Blanket Mine (1983) (Private) Limited Merger” 2015 78.4 THRHR 589, IGNATIOUS NZERO makes the observation that the application of the eiusdem generis rule to the words “or other person” would be a mis-interpretation of the provisions of section 2 of the Competition Act. He criticised the legal opinion that suggested that the application of the eiusdem generis rule in the interpretation of section 2 of the Competition Act was appropriate. He stated:

“It is submitted that the application of the rule (eiusdem generis) in determining the meaning of the phrase 'or other person', as used in the statutory definition of a merger, results in absurdity, as it would mean that only economic activities having an effect on the economy of Zimbabwe in the same class as competitor, supplier and customer would constitute a merger whereas other economic activities with similar effect on the economy of Zimbabwe, but which are not in the same genus or class as 'competitor, supplier, customer', would not constitute a merger.

It is submitted that there is enough ammunition provided in the statute to determine the extent to which the legislature intended the statute to apply in general and the types of mergers covered in particular. As such, the application of the eiusdem generis rule was not necessary as it had the effect of creating an artificial gap in the statutory merger definition. The rule should not be applied as a general rule of application, but, rather, cautiously to avoid misinterpretation of statutory provisions.

In particular, in constructing the meaning of 'or other person' used in section 2, it must be remembered that the eiusdem generis rule is only one of many rules of construction; it is not to be invoked automatically whenever general words follow particular words.”

Interpreting words in their context requires the courts to pay due regard not only to the meaning assigned to the grammatical use of language but also the context, which requires consideration of the rest of the statute as well as its subject matter and its content.

This position was affirmed in the case of Stellenbosch Farmers' Winery Ltd v Distillers Corp (SA) Ltd 1962 (1) SA 458 (AD) 476, as quoted by GM COCKRAM…, The Interpretation of Statutes 3rd ed, as follows:

“It is the duty of the court to read the section of the Act which requires interpretation sensibly, i.e. with due regard, on the one hand, to the meaning which permitted grammatical usage assigns to the words used in the section in question, and, on the other hand, to the contextual scene, which involves consideration of the language of the rest of the statute as well as the matter of the statute, its apparent scope and purpose, and, within limits, its background.”

To determine the context in which the words “or other person” have been used, the scope and purpose of the provision in question and the Competition Act at large must be determined first. The scope and purpose of the Competition Act [Chapter 14:28], as provided for in the Act's long title, reads as follows:

“AN ACT to promote and maintain competition in the economy of Zimbabwe; to establish an Industry and Trade Competition Commission and to provide for its functions; to provide for the prevention and control of restrictive practices, the regulation of mergers, the prevention and control of monopoly situations and the prohibition of unfair trade practices; and to provide for matters connected with or incidental to the foregoing.”

It is clear from this title that, among other things, the Competition Act aims to promote and maintain competition in the economy by regulating anti-competitive mergers.

Merger regulation is at the core of competition law, and, in the spirit of regulating anti-competitive mergers, the Legislature enacted the current wide definition which covers all mergers which must be notified to the respondent.

In terms of the Competition Act, when a merger is notified, the respondent decides if the merger undermines competition.

Conglomerate mergers, although not entered into with competitors, suppliers, or customers, just like horizontal and vertical mergers, affect competition. All mergers have the capacity to undermine competition.

The contention by the appellants was that if the Legislature had intended to cover all types of mergers because of their potential negative effects on competition it would have said so without specifying the categories of customer, supplier, and competitor.

The Legislature has a discretion on how it chooses to express its intention in the enactment of laws. The question of whether the intention behind a statutory provision is inelegantly expressed should not concern a court. The duty of a court is to ascertain the intention of the Legislature however it is expressed.

In Van Heerden v Queen's Hotel (Pty) Ltd 1973 (2) SA 14 (RAD) 21, the court explained that:

“In interpreting statutes, courts are not concerned with the elegance of the language used. Statutory instruments are not usually remarkable for the elegance of their language. The court must interpret the words in a statutory instrument so as to give effect to the true intention of the legislature, and once that intention is clear, the fact that the language used in expressing it may not be as elegant as some would like, is not a matter of consequence, especially if the language is grammatical and easily understood.”

Disposition

It was for these reasons that the Court was satisfied that the concession by counsel for the appellant that the appeal lacked merit was well-founded, and, accordingly, dismissed the appeal with costs.

HH978-15 : IGNATIUS MASAMBA vs SECRETARY-JUDICIAL SERVICE COMMISSION
Ruled By: MUNANGATI-MANONGWA J

This is an exception by the defendant to the plaintiff's summons and declaration, as amplified by further particulars, on the grounds that the plaintiff's claim does not disclose a cause of action.

The defendant further avers that the claim is bad in law.

The background to this case is that the plaintiff had sued for damages in the Magistrates' Court in an action he had stated as “trespass on person-battery”. As no appearance to defend was entered, he sought default judgement. The magistrate threw out his application, and, in doing so, stated that the plaintiff had sued for “trespass on land”.

The plaintiff appealed against the decision and the appeal is pending in this court.

Arising out of those circumstances, the plaintiff has, in this matter, instituted an action for damages against the defendant, being Secretary–Judicial Service Commission.

The plaintiff relies on vicarious liability, and is suing the defendant in a representative capacity as the employer of the magistrate who dismissed his case.

The action is defended.

The plaintiff's claim is couched as follows:

“The failure or omission to read accurately all the plaintiff's documents filed of record at court by the plaintiff in this matter, that has a cause of action of 'Trespass to the person-battery' which the magistrate read as 'Trespass to land'…, inexplicably.”

The plaintiff further states that he is suing the defendant in contract and delict in her representative capacity.

The defendant requested for further particulars; upon being furnished with same, the defendant raised an exception to the plaintiff's summons.

The exception is premised on the following grounds:

(i) The summons do not reveal a cause of action for its claim against the defendant thus does not comply with the peremptory provisions of Order 3 Rule 11(c) of this court's rules which specifically provides that a summons shall contain “a true concise statement of the nature, extent, and grounds of the cause of action and of relief or remedies sought in the action.”

(ii) The summons are vague and embarrassing in that it is not clear whether the plaintiff's claim is in contract or in delict. The plaintiff has not averred any of the elements required to succeed in a claim either in delict or contract.

(iii) There is no action known as “professional negligence for mental suffering” which further points to the fact that the claim is vague and embarrassing.

The defendant sought dismissal of the plaintiff's claim with costs at a higher scale.

After service of the exception on the plaintiff, he filed a document headed “Notice of Amendment” in which he sought to amend the claim indicating that at the hearing he was to apply to amend the summons.

No such application was made on the day of the hearing.

Suffice to say, the notice of amendment would not have changed the state of papers as nothing materially changed apart from creating further confusion.

Before the hearing, the plaintiff raised issue that the defendant had not filed her heads of argument on time since they were filed after the plaintiff had filed a response to the exception and filed a notice to amend summons, hence, the defendant was barred.

The defendant's counsel disputed that assertion insisting there was no bar in operation against the defendant.

The court found no merit in the plaintiff's assertion.

Clearly, the defendant filed heads of argument on 2 November 2015 and served same on plaintiff; the plaintiff filed his on the 12th November 2015, hence, there is no issue of delay in that aspect and no bar operated against the defendant.

The court proceeded to hear the matter on the merits.

Counsel for the defendant argued that the plaintiff's summons did not satisfy the mandatory requirements set out in Rule 11(c) of the High Court Rules; that omission rendered them a nullity. She referred the court to the case of Bank of Credit & Commerce Zimbabwe Ltd v Jani Investments (Private) Limited 1983 (2) ZLR 317 (H)…, where, faced with similarly defective summons, the court remarked:

“It will be immediately realised, of course, by someone who runs very quickly as he reads, that the summons is wholly invalid since it discloses no cause of action whatever. Any exception to such summons can only succeed instantly and completely.”

She further argued that the summons was vague and embarrassing as it did not disclose whether the claim was based in delict or contract law.

In response, the plaintiff maintained that a reading of the summons and declaration, which documents were complimentary, made issues clear. Further, he had filed a notice of amendment.

The heads of argument filed by the plaintiff were not helpful as they contained a lot of historical evidence and did not further his case.

I agree with the submissions made by the defence counsel regarding the non-compliance and the inadequacy of the summons and declaration.

A reading of the summons, declaration, and further particulars, clearly reveals that these documents contain long winding explanations duly tainted with allegations of bribery, corruption, and political interference against different court officials.

There is no true and concise statement of the nature, extent, and grounds of the cause of action.

Facts and evidence are all mixed up and one gets to pains as to determine the facts upon which, at law, one can rely on to sustain a claim.

In ODGERS Principles of Pleading and Practice in Civil Actions in the High Court of Justice, 2nd Ed…, it is stated as follows;

“The object of pleadings is to ascertain, definitely, what is the question at issue between the parties and this object can only be attained when each party states his case with precision.”

It is this precision that, in my view, Rule 11(c) of this court's rules advocates for.

The reason behind Rule 11(c) is to ensure that a summons be a document that clearly and concisely sets out the facts that the plaintiff relies on which establish a cause at law for which specific relief can be sought. Compliance with the requirement would create or bring out a case to which the defendant is able to answer. It must be clear, to the defendant, what it is he is alleged to have done giving rise to the plaintiff, at law, to claim the relief sought.

Rule 99(c) of the High Court Rules, although not referred to by the defendant, comes to play. It states that;

“A pleading shall -

(c) Contain a statement, in summary form, of the material facts on which the party pleading relies for his claim or defence, as the case may be, but not the evidence by which they are to be proved.”

There has to be a summary of allegations of fact which, in law, give rise to a claim or justify the relief sought.

In casu, facts in the summons and declaration are so mixed up so as to cloud the case to which the defendant has to answer. In essence, they are vague and embarrassing so as to go to the root of the claim.

The court further agrees with the defendant's submissions that it is not clear under which branch of law the plaintiff is suing.

Be it in delict or contract, the plaintiff has failed to satisfy the elements that sustain a claim under either of the branches.

In purporting to claim delictual damages, the plaintiff's declaration reads as follows:

“(i) There was damage of mental suffering directly arising out of the magistrate's ruling to the plaintiff which is actionable under negligence law.

The plaintiff bases this averment on what he considers to be failure by the defendant to recruit a competent magistrate.”

The issue is: there is no cause of action like 'damage of mental suffering'.

Even if one can sue for mental distress, the facts alleged do not support liability.

The plaintiff appealed against the judgment granted in the Magistrates' Court.

Further, one cannot sue a magistrate for damages when he/she is acting in their professional capacity for mis-interpreting the law or the facts, hence the appeal and review processes.

Of note is the fact that the defendant in this matter is the Secretary–Judicial Service Commission; apart from not being the employer of Ms Dzikiti, the alleged magistrate (the employer being the Judicial Service Commission) the sitting magistrate herself was not cited.

Most important, as the defendant is not an employer in the circumstances no vicarious liability can attach to her.

The contractual claim is stated as follows:

“The plaintiff is suing in contract because the plaintiff paid court fees being in consideration for a competent (a fit and proper ruling).”

The question is; in paying for court fees, did the plaintiff enter into a contract with the sitting magistrate?

This is not so, as court fees are meant for processing of papers and never for the judgment.

HH149-16 : ZIMASCO (PRIVATE) LIMITED vs COMMISSIONER GENERAL OF THE ZIMBABWE REVENUE AUTHORITY
Ruled By: HLATSHWAYO J

On 23 January 2015, after hearing counsel and having gone through papers filed of record, and the parties having failed to settle the matter on the basis of recent precedent, I gave an order dismissing the appeal with costs and indicated that reasons thereof will follow in due course.

I now proceed to set them down below.

The facts of this matter are common cause:

By correspondence dated 13 March 2007, the respondent made a ruling, that, the appellant was obliged to withhold and remit non–resident tax on fees paid to an entity known as Centachrome, an agent based in Switzerland.

Centachrome was appointed “sub-agent” in an agreement entered into by and between the appellant (“producer”), the Minerals Marketing Corporation of Zimbabwe (MMCZ) (“marketing agent”) and Centachrome.

Centachrome was supposed to facilitate the selling of ferrochrome produced by the appellant, but sold through the Minerals Marketing Corporation of Zimbabwe (MMCZ) in terms of the Minerals Marketing Corporation of Zimbabwe Act [Chapter 21:04] which requires that all minerals mined in Zimbabwe are marketed by and through the MMCZ.

On 11 May 2007, the appellant wrote to the respondent objecting to the ruling. By letter dated 15 November 2007, the respondent disallowed the objection but reduced the penalty to 60% from the initial 100% it had stipulated.

Aggrieved by the decision of the respondent, the appellant noted an appeal to this Court challenging the decision of the respondent on grounds that may be summarised as follows:

(a) The appointment of Centachrome had the effect of making it an agent of the Minerals Marketing Corporation of Zimbabwe (MMCZ) and not an agent of the appellant.

(b) The appellant was not obliged to pay withholding non–resident tax since the money paid to Centachrome was commission and commission is not fees as defined in terms of the 17th Schedule of the Income Tax Act [Chapter 23:06].

(c) The money paid to Centachrome was not derived from a source within Zimbabwe as stipulated by the 17th Schedule of the Income Tax Act [Chapter 23:06]....,.

PENALTIES

In so far as penalties are concerned, the appellant submitted, that, it acted in good faith and on the basis of legal advice, without the intention of evading any liability to tax, and that, accordingly, the respondent ought to have waived the penalties altogether and not merely reduced them by 40%.

However, the respondent maintained it had taken into account those mitigating factors in arriving at the partial reduction of the penalty, and that its decision was in line with previous cases of a similar nature.

Unfortunately, I was not referred to any authorities to justify interference with a discretion exercised by the respondent.

HMT45-19 : JAMES DRYNAN vs MAGISTRATE N. N KUTURE and ZIMBABWE NATIONAL ROADS ADMINISTRATION
Ruled By: MUZENDA J

On 18 September 2018, the applicant filed a court application for review seeking the following relief spelt out in the draft order:

“1. The decision of the first respondent in which she made an order for the rescission of default judgment in court case number 127/18 in favour of second respondent be and is set aside.

2. The application of second respondent for rescission of default judgment be remitted for rehearing before a different magistrate.”

On 28 September 2018, the second respondent filed its opposing papers.

BACKGROUND

On 5 February, the applicant initiated summons at the Magistrates Court claiming US$651 from the second respondent, the Zimbabwe National Roads Administration.

The applicant, on 21 May 2013, attempted to receive an exemption over a number of his motor vehicles from Zimbabwe National Roads Administration for the period extending 1 June 2013 to 31 May 2014.

The Zimbabwe National Roads Administration officials demanded a letter from a commercial garage certifying such automobiles inoperative for a specified period.

From 2013 to 2018, a number of correspondences took place between the applicant and the second respondent.

In January 2018, the applicant was told, by the Zimbabwe National Roads Administration, to pay a total of $696 licencing penalty and penalty fees up to 30 April 2018.

The applicant admitted to pay $45 but resolved to claim $651, being the difference between $699 and $45, which amount he argued was excessive and unjustified in his view.

On 25 February 2018, a default judgment was granted in favour of the applicant.

On 12 March 2018, the Zimbabwe National Roads Administration filed an application for rescission of judgment.

The second respondent also filed, on the same date, an ex parte application for stay of execution.

On 26 March 2018, the applicant filed his opposing papers for the rescission of judgment as well as stay of execution.

On 13 July 2018, the magistrate, the first respondent in this application, heard the application for rescission and stay and deferred her ruling to 27 July 2018.

It is common cause, that, both applications, for rescission and stay of execution, were granted.

The second respondent was given leave by the magistrate to file a notice of appearance to defend. It filed it, and, then, proceeded to file an exception to the current applicant's summons.

Meanwhile, the applicant embarked on a vitriolic attack of the judicial officer, the magistrate, through writing of letters up to the Chief Justice.

When the second respondent caused the exception to be set down for argument, the trial magistrate, recused herself, patently because of the attack by the applicant.

The exception was set down for 11 September 2018 and postponed to 20 September 2018 so that a different magistrate would deal with the matter.

Before the matter could be heard, as already indicated, the applicant filed a court application for review.

Meanwhile, the hearing of the exception was deferred indefinitely until the finalisation of the review application.

On 24 June 2019, I gave the following order, indicating that I would give reasons for that order:

“IT IS ORDERED THAT:

1. Points in limine raised by the 2nd Respondent is upheld.

2. Application for review is dismissed with costs on attorney client scale.”

On the very date, 24 June 2019, the applicant submitted a letter addressed to the Registrar which he wanted to be placed before me raising my attention “on matters which he might have overlooked in an attempt to deal expeditiously with the proceedings before him” to use the applicant's own words.

As a matter of comment, I read the letter, but, at that stage, the court was functus officio. I could not revisit the proceedings.

I opted not reply the letter, serve to mention, that, the very points raised by the applicant had been extensively covered by the applicant in a document he produced in court.

I had read the document, and, in principle, covered the chronicle of what has built up in the matter before the application.

I wonder why the applicant assumed that I had not appreciated what he had submitted, but, presumably because I had dismissed his application, he thought that I had missed the point.

I had not, and, the following are my reasons for upholding the second respondent's preliminary points.

The second respondent submitted, that, the application for review is fatally defective for want of compliance with Order 33 Rule 257 of the High Court Rules of Zimbabwe.

Rule 257 of the High Court Rules provides:

“The Court application shall state, shortly and clearly, the grounds upon the applicant seeks to have the proceedings set aside or corrected and the exact relief prayed for.”

The applicant did not outline these reasons on the application.

They appear in paragraph 70 of his founding affidavit and stretches from paragraph 71 to paragraph 80.

Even assuming that the grounds were stated by the applicant; they are not short and precise, and, maybe the applicant followed Rule 256.

In addition, the exact relief prayed for by the applicant does not appear on the face of the application.

It is peremptory that the provisions of Rule 257 must be complied with, as well spelt out by MAKONI J…, in the matter of Fabiola N. Gonye v Fadzai Mtombeni N.O. and Others HH356-17.

“The import of the above Rule is that an applicant seeking a review must approach this court by way of court application unless it is a proceeding in terms of any other law other than Rule 256. It is incumbent upon such application to state clearly in terms of which law is proceeding under in filing the application for review right at the outset. Where no such clear statement is made in the court application it will be taken that the applicant is proceeding in terms of Rule 256.”

Hence, failure to comply with this Rule constitutes a fatal flaw.

“As regards the failure on the part of Chataura to comply with Rule 257 of the High Court Rules, it seems to me, that, non-compliance would constitute good grounds for dismissing this application. Rule 257 requires that an application to bring proceedings under review shall state shortly and clearly the grounds upon which the applicant seeks to have the proceedings set aside or corrected and the exact relief prayed for. In the Pen Transport, Mushaishi and Marumahoko cases referred to earlier, the courts clearly stated that failure to comply with Rule 257 constituted a fatal flaw. The time has surely come to say enough is enough and to dismiss the defective applications without considering the merits:” see Chataura v Zimbabwe Electricity Supply Authority 2001 (1) ZLR 30 (H) per SMITH J.

In the matter of Dandazi v Wankie Colliery Co. Ltd 2001 (2) ZLR 298 (H) the rationale of compliance with Rule 257 of the High Court Rules was reiterated and the court held:

“At this stage, I wish to make an observation which is relevant to many review applications that are brought to the High Court. In terms of Order 33 Rule 257, it is a requirement that: the court application shall state, shortly and clearly, the grounds upon which the applicant seeks to have the proceedings set aside or corrected and the exact relief prayed for.

This is not an idle requirement.

It was inserted in the rules of the court so that an applicant for review may apply his mind to the grounds upon which he seeks a review and be able to state them clearly and in brief form.

Often, in review applications, all sorts of grounds are lumped together in the body by the founding affidavit making it very difficult for the presiding judicial officer to determine the grounds upon which the matter is to be reviewed.”…,.

This is exactly what the applicant did in this application.

He vehemently argued, that, the grounds for review or relief sought, are part of the affidavit.

I conclude, that, in the light of the above cases cited, that is a gross irregularity; such non-compliance with Rule 257 of the High Court Rules goes to the root of the application, which only can be addressed by dismissing the application.

The applicant's grounds for review is that of bias and irrationality on the ruling of the Magistrate.

Such a ground must equally be stated in the court application: see Dandazi v Wankie Colliery Co. Ltd 2001 (2) ZLR 298 (H).

A failure to do so is a gross irregularity which renders a matter improperly before the court and that is where the court held that:

“If, as in the present case, the grounds are based on bias and gross irregularity in the proceedings, then, those grounds must be stated in the application. A failure to do so, as was the case in this application, is a failure to comply with Order 33 Rule 257. The consequence of that failure is that the matter is not properly before the court and the applicant must not be heard.”…,: see also the matter of Minister of Labour & Others v Pen Transport (Pvt) Ltd 1989 (1) ZLR 293 (S) per GUBBAY JA…,.

I allowed the applicant to make submissions relating to both the points in limine and the merits.

However, having looked at the preliminary points capably addressed by the second respondent, I am of the view, that, the applicant's papers are not in order and the points in limine were accordingly upheld with an order of costs on a punitive scale.

SC19-14 : DAVID TENDAYI MATIPANO vs GOLD DRIVEN INVESTMENTS (PRIVATE) LIMITED
Ruled By: MALABA DCJ, ZIYAMBI JA and GOWORA JA

On 9 March 2011, the High Court granted an order of provisional sentence in the sum of USD2,322,089=52 against the respondent in favour of Metropolitan Bank Zimbabwe (Pvt) Ltd. The respondent, who was cited as the defendant, was in default of entry of appearance to defend.Pursuant to that judgment, the ...

Pursuant to that judgment, the judgment creditor caused a writ to be issued on 14 April 2011 for the payment of the debt.

David Tendayi Matipano, the appellant, was the Deputy Sheriff for Harare. Acting on instructions from the lawyers of the judgment creditor, on 14 April 2011, the Deputy Sheriff attached 634,600 tonnes of tobacco at the premises of the respondent. On 29 April 2011, the Deputy Sheriff conducted a sale in execution of the tobacco stocks. However, the proceeds of the sale were insufficient to settle the judgment debt. Consequently, on 3 May 2011, the Deputy Sheriff attached more tobacco stocks in a bid to raise the sum of USD2,322,089=52. A sale by public auction of the attached stocks was scheduled for 20 May 2011. Prior to the scheduled date of the sale, the respondent and the judgment creditor agreed that the stocks were to be sold by private treaty in order to realise a better price. On 30 May 2011, a sale by private treaty of the stocks was concluded by the respondent and the buyer and payment was effected.

On 19 May, in anticipation of the successful conclusion of the sale, the judgment creditor instructed the Deputy Sheriff to cancel the sale scheduled for 20 May 2011 and the sale was cancelled. Subsequently, in June 2011, the Deputy Sheriff, in letters addressed to the respondent's legal practitioners, demanded payment of commission in the sum of USD226,297=25. The respondent queried the amount being demanded for commission. When the amount remained unpaid, the Deputy Sheriff gave instructions to an auctioneer to sell tobacco stocks in its possession for recovery of the alleged commission.

The respondent then paid.

On 3 February 2012, the respondent instituted an application in the High Court against the Deputy Sheriff in which it demanded a partial refund of the sum paid as commission. On 27 June 2012, the High Court issued an order in favour of the respondent in the following terms:

“1.It is declared that the commission levied by the respondent in case No HC1201/11, in respect of goods attached on 3 May 2011, under High Court (Fees and Allowances) Rules S.I. 35/2009 is unlawful.

2. The respondent is ordered to levy his commission on writ of execution against movable property dated 13 April 2011 in respect of goods attached on 3 May 2011 issued in case No HC1201/11 in terms of clause 8(1)(c) of the High Court (Fees and Allowances) Rules S.I.57/2011.

3. It is ordered that the respondent shall refund the applicant all sums of money paid in excess of the amounts due to him under clause 8(1)(c) of the High Court (Fees and Allowances) Rules S.I. 57/2011.

4. The respondent shall pay the applicant's costs.”

It is against this order that the Deputy Sheriff now appeals. The grounds of appeal are as follows -

1. The learned judge erred in finding, in effect, that the court had jurisdiction to determine that the fees the appellant should have been allowed by the Sheriff even though the Sheriff had himself not been asked to determine them.

2. The learned judge erred in failing to find that the respondent's application was not properly before the court, and, more particularly, erred -

a) In finding, in effect, that the Sheriff was not empowered to interpret the tariff of fees which he is empowered to administer;

b) In finding that the respondent had the right to approach the court even though he had failed to require the judgment creditor to have a bill of costs taxed; and

c) In finding, in effect, that the respondent had locus standi to seek a declaratory order relating to the fee the appellant could charge the judgment creditor.

3. The learned judge erred in finding that the respondent's papers disclosed a cause of action, and, in particular, erred -

a) In finding, in effect, that the mere fact that a sum paid is said to have been not wholly due gives rise to an enforceable claim;

b) In finding that the respondent's cause of action was the unjust enrichment of the appellant when no averment to that effect was contained in its papers;

c) In failing to find that the payment made by the respondent was a voluntary one, and, accordingly, that any overpayment made would not have been refundable;

d) In finding that the High Court decisions cited by the appellant pertaining to the making of payments under protest contradict the decision of this Honourable Court also cited by the appellant;

e) In finding that a fee raised in excess of that specified in the tariff is per se unlawful;

f) In any event, in finding that the unlawfulness of a sum charged gives rise to a claim for a refund.

4. The learned judge erred in any event in finding that:-

a) The issue to be determined was the choice of law under which the appellant was entitled to charge a fee instead of the date at which the fee was to be calculated;

b) The fee payable to the appellant was incurred at the date of cancellation of the sale instead of the date of attachment of the respondent's tobacco.

Alternatively, erred in failing to find that the appellant was entitled to charge a fee on the proceeds of the sale by private treaty as well as on cancellation of the sale of the remaining tobacco (sic).

It was contended, firstly, that the matter was not properly before the High Court because it is not the forum in which disputes concerning the quantum of a fee payable to a Deputy Sheriff are decided in the first instance.

It was suggested that the respondent should have insisted on a taxation of the fees due to the Deputy Sheriff before paying, or, alternatively, that the respondent should have paid under protest and sought taxation. Having failed to do either, it was argued that the respondent had been left without remedy.

The respondent contends that the money was not due, and, further, that since the legislation under which the commission was levied had been repealed then the demand under the repealed legislation is unlawful and wrongful, and, in the circumstances, is a legal nullity.

WAS THE SHERIFF EMPOWERED TO DETERMINE THE QUESTION AS TO THE APPROPRIATE TARIFF AND AS A CONSEQUENCE DID THE HIGH COURT LACK JURISDICTION TO DETERMINE THE DISPUTE?

It is common cause that at the time that the Deputy Sheriff attached the respondent's tobacco stocks he was entitled to raise his charges under S.I.35 of 2009. However, when the judgment creditor stopped the sale in execution scheduled for 20 May 2011, S.I.35 of 2009 had been repealed by S.I.57 of 2011, which came into effect on 13 May 2011. Central to the dispute was the percentage utilised by the Deputy Sheriff to calculate his commission for work rendered. It is common cause that when S.I.57 of 2011 came into force and repealed S.I.35 of 2009; it effectively reduced the percentage rates that the appellant could charge as commission. Hence, the dispute between the parties translated into which of the two statutory instruments was applicable at the time that the Deputy Sheriff sought to raise charges for his commission, and, as correctly stated by the learned judge in the court a quo, the dispute raised a question of law and not fact.

I do not accept that this is a case where the interpretation of the applicability of Rule 457(3) comes into question. For the contention that the jurisdiction of the High Court does not extend to the determination of disputes relating to fees charged by a Deputy Sheriff, reliance is placed on the provisions of Rule 457 of the Rules of the High Court 1971. Order 50 Rule 457 states that:

“(3) Necessary charges and allowances for all work necessarily done for which no provision is contained in such tariff, and every question arising under and relative to the tariff, shall be determined by the Sheriff.”

The submission by the Deputy Sheriff that the High Court had no jurisdiction to determine the dispute because of the wording of Rule 457(3) is devoid of merit.

The Rules are made under the High Court Act and my reading of the Rule in question does not lead me to conclude that the jurisdiction of the court has been ousted. Contrary to what was argued on behalf of the Deputy Sheriff, what was before the learned judge in the court a quo was the applicable statutory instrument.

Once it is accepted that the issue before the court a quo was to do with the applicable tariff to be applied in the calculation of the commission, then it stands to reason that the issue was one of law and firmly within the purview of the High Court. The High Court was undoubtedly seized with jurisdiction.

In my view, the Sheriff, contrary to the submissions proffered on behalf of the Deputy Sheriff, is not empowered to decide issues relating to the applicable law that the Deputy Sheriff is entitled to rely on in levying fees and charges. What Rule 457 provides for is for the Sheriff to determine the accuracy or otherwise of charges raised by his deputy. He cannot, and is not empowered to, determine the applicable statutory instrument. That is an issue which is solely within the purview of a court.

In any case, the respondent had sought a declaratur, and the High Court is empowered to issue a declaration as to the rights of parties. Sections 13 and 14 of the High Court Act [Chapter 7:06] provide in relevant part:

“13 Original civil jurisdiction

Subject to this Act and any other law, the High Court shall have full original civil jurisdiction over all persons and over all matters within Zimbabwe.

14 High Court may determine future or contingent rights

The High Court may, in its discretion, at the instance of any interested person, inquire into and determine any existing, future or contingent right or obligation, notwithstanding that such person cannot claim any relief consequential upon such determination.”

The Deputy Sheriff did not argue that the High Court does not have original jurisdiction to issue a declaratur, and to the extent that the powers of the High Court have not been impugned in that respect, I hold that the respondent established a cause of action which was then confirmed in the order that was issued in favour of the respondent….,.

WHETHER THE FEE TO BE CHARGED BY THE DEPUTY SHERIFF IS CALCULATED AS AT THE DATE OF ATTACHMENT OR THE DATE OF SALE OR CANCELLATION THEREOF

It was contended on behalf of the Deputy Sheriff that, in terms of para 8(1)(c) of the tariff, a fee is earned by a Deputy Sheriff by the attachment of the goods and not by the withdrawal of the writ by the judgment creditor. This submission is premised on the provisions of the High Court Rules 1971, Order 40 Rule 327, which provides as follows:

“327. Writ may be withdrawn or suspended

(1) A writ of execution may, on payment of the fees incurred, be withdrawn or suspended at any time by notice to the sheriff or his deputy by the party who has sued out such writ.”

Contrary to the assertion by the Deputy Sheriff, I do not read in that provision an entitlement by the Deputy Sheriff to payment of fees based on the mere attachment of goods, whether movable or immovable. Rather, Order 40 is concerned, generally, with the process of attachment and Rule 327 permits the withdrawal or suspension of a writ at any time and seeks to protect the payment of fees to the Deputy Sheriff for any work done in connection with the writ. It does not set out the manner in which the Deputy Sheriff is obliged to levy and calculate his fees.

The inescapable conclusion is that the applicable law in calculating the commission is the tariff of fees set out in the High Court (Fees and Allowances) (Amendment) Rules.

In order to resolve the dispute as to which is the relevant tariff, it is necessary to have regard to the specific provisions of the tariff. Section 8 of the tariff provides in relevant part:

“(1) In respect of execution -

(a) When a writ is paid on presentation, ten per centum of the amount of the writ, with a minimum of….,.

(b) When a writ is withdrawn by the judgment creditor, or the judgment debtor's estate is placed under sequestration or liquidation before any movable property has been attached, a fee of USD10=.

(c) When a writ is withdrawn or suspended by the judgment creditor, or the judgment debtor's estate is placed under sequestration or liquidation after movable property has been attached but before sale, ten per centum of the value of the property attached, but such value shall not exceed the amount directed to be recovered.

(d) When a writ is paid by the judgment debtor to the Deputy Sheriff after movable property has been attached but before sale, ten per centum of the amount so paid.

(e) After sale in execution, ten per centum of the net amount recovered, or, if the Deputy Sheriff acted as auctioneer, ten per centum of that amount.

(2) No fee shall be allowed on the value of movable property attached but subsequently claimed by a person other than the judgment debtor and released in consequence to that claim, unless the property was attached at the express direction of the judgment creditor.”

The High Court held that section 8(1) lists all the situations in which the Deputy Sheriff is entitled to claim his commission. The learned judge also found that the fee accrues on the date on which the event listed in the section occurs. The fee does not accrue through the attachment, which is a process comprising various events.

He was correct.

The fee accrues after the occurrence of any of the following events;

(i) On a sale in execution;

(ii) Payment by the debtor upon presentation of the writ; or

(iii) Withdrawal or suspension of the writ by the judgment creditor.

In this case, the writ was withdrawn by the judgment creditor - which event triggered the calculation of the fees due to the Deputy Sheriff.

As the withdrawal of the writ was effected after the repeal of S.I.35 of 2009 by S.I.57 of 2011 it stands to reason that the fees had to be calculated in terms of the provisions of S.I 57/2011 which governed that event.

I find the contention by the Deputy Sheriff that the fee accrued as a result of the attachment legally unsustainable. The learned judge found that the Deputy Sheriff had levied fees under the wrong statutory instrument and determined that the respondent was entitled to a refund. The order granted was a declaration that the commission levied by the appellant was unlawful.

DISPOSITION

The appeal has no merit. It is therefore dismissed with costs.

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Administrative Law re: Administration Fees

HH81-09 : SAFARI OPERATORS ASSOCIATION OF ZIMBABWE vs ZIMBABWE TOURISM AUTHORITY and MINISTER OF ENVIRONMENT AND TOURISM and COMMISSIONER GENERAL OF POLICE
Ruled By: PATEL J

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Ruled By: CHIGUMBA J

SC52-18 : INNSCOR AFRICA LIMITED and GERIBRAN SERVICES (PRIVATE) LIMITED vs COMPETITION AND TARIFF COMMISSION
Ruled By: MALABA CJ, HLATSHWAYO JA and PATEL JA

HH978-15 : IGNATIUS MASAMBA vs SECRETARY-JUDICIAL SERVICE COMMISSION
Ruled By: MUNANGATI-MANONGWA J

HH149-16 : ZIMASCO (PRIVATE) LIMITED vs COMMISSIONER GENERAL OF THE ZIMBABWE REVENUE AUTHORITY
Ruled By: HLATSHWAYO J

HMT45-19 : JAMES DRYNAN vs MAGISTRATE N. N KUTURE and ZIMBABWE NATIONAL ROADS ADMINISTRATION
Ruled By: MUZENDA J

SC19-14 : DAVID TENDAYI MATIPANO vs GOLD DRIVEN INVESTMENTS (PRIVATE) LIMITED
Ruled By: MALABA DCJ, ZIYAMBI JA and GOWORA JA

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Law Portal Zimbabwe

Administrative Law re: Administration Fees

HH81-09 : SAFARI OPERATORS ASSOCIATION OF ZIMBABWE vs ZIMBABWE TOURISM AUTHORITY and MINISTER OF ENVIRONMENT AND TOURISM and COMMISSIONER GENERAL OF POLICE Ruled By: PATEL J

HH485-16 : PUWAYI CHIUTSI LEGAL PRACTITIONERS vs THE REGISTRAR OF THE HIGH COURT and THE TAXING OFFICER Ruled By: CHIGUMBA J

SC52-18 : INNSCOR AFRICA LIMITED and GERIBRAN SERVICES (PRIVATE) LIMITED vs COMPETITION AND TARIFF COMMISSION Ruled By: MALABA CJ, HLATSHWAYO JA and PATEL JA

HH978-15 : IGNATIUS MASAMBA vs SECRETARY-JUDICIAL SERVICE COMMISSION Ruled By: MUNANGATI-MANONGWA J

HH149-16 : ZIMASCO (PRIVATE) LIMITED vs COMMISSIONER GENERAL OF THE ZIMBABWE REVENUE AUTHORITY Ruled By: HLATSHWAYO J

HMT45-19 : JAMES DRYNAN vs MAGISTRATE N. N KUTURE and ZIMBABWE NATIONAL ROADS ADMINISTRATION Ruled By: MUZENDA J

SC19-14 : DAVID TENDAYI MATIPANO vs GOLD DRIVEN INVESTMENTS (PRIVATE) LIMITED Ruled By: MALABA DCJ, ZIYAMBI JA and GOWORA JA

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Law Portal
Zimbabwe

HH81-09 : SAFARI OPERATORS ASSOCIATION OF ZIMBABWE vs ZIMBABWE TOURISM AUTHORITY and MINISTER OF ENVIRONMENT AND TOURISM and COMMISSIONER GENERAL OF POLICE
Ruled By: PATEL J

HH485-16 : PUWAYI CHIUTSI LEGAL PRACTITIONERS vs THE REGISTRAR OF THE HIGH COURT and THE TAXING OFFICER
Ruled By: CHIGUMBA J

SC52-18 : INNSCOR AFRICA LIMITED and GERIBRAN SERVICES (PRIVATE) LIMITED vs COMPETITION AND TARIFF COMMISSION
Ruled By: MALABA CJ, HLATSHWAYO JA and PATEL JA

HH978-15 : IGNATIUS MASAMBA vs SECRETARY-JUDICIAL SERVICE COMMISSION
Ruled By: MUNANGATI-MANONGWA J

HH149-16 : ZIMASCO (PRIVATE) LIMITED vs COMMISSIONER GENERAL OF THE ZIMBABWE REVENUE AUTHORITY
Ruled By: HLATSHWAYO J

HMT45-19 : JAMES DRYNAN vs MAGISTRATE N. N KUTURE and ZIMBABWE NATIONAL ROADS ADMINISTRATION
Ruled By: MUZENDA J

SC19-14 : DAVID TENDAYI MATIPANO vs GOLD DRIVEN INVESTMENTS (PRIVATE) LIMITED
Ruled By: MALABA DCJ, ZIYAMBI JA and GOWORA JA