Administrative Law re: Presumptions of Regularity and Validity of Official Documents or Advice & Doctrine of Estoppel

Appealed
SC16-20 : INFRASTRUCTURE DEVELOPMENT BANK OF ZIMBABWE vs ENGEN PETROLEUM ZIMBABWE (RIVATE) LIMITED
Ruled By: GUVAVA JA, MAVANGIRA JA and ZIYAMBI AJA

This is an appeal against the decision of the High Court handed down under HH253-16 wherein the court a quo found the appellant liable to pay to the respondent the sum of US$847,847=65 together with costs of suit and interest at the prescribed rate from the date of the granting of the judgment to the date of payment in full.

The appellant is a statutory corporation set up in terms of the Infrastructure Development Bank of Zimbabwe Act [Chapter 24:14] (“the IDBZ Act”). The respondent is an oil company registered in accordance with the Companies Act [Chapter 24:03].

The background to the matter may be summarized as follows:

A company known as Wedzera Petroleum (Private) Limited (“Wedzera”) entered into a verbal agreement with the respondent wherein the respondent would sell bulk petroleum fuels to it from time to time. The respondent would supply the petroleum products on credit and raise invoices to be settled by Wedzera Petroleum. Wedzera Petroleum would, in turn, settle the invoices within ten days from the date on which the invoices would be raised.

In November 2010, the respondent sold to Wedzera, petroleum products worth US$847,847=65. The sale of the petroleum products was made on the basis of two guarantees made by the appellant binding itself to pay in the event that Wedzera Petroleum failed to honour the debt. The two guarantees were drafted on 5 November 2010 and 19 November 2010 for the sums of US$500,000 and US$450,000 respectively.

The guarantees issued by the appellant were in the form of a letter, which bore the letter head of the Infrastructural Development Bank of Zimbabwe. It was addressed to the respondent and signed by one Francis Mugwara (“Mugwara”) the Head of the Short Term Loans Unit.

Part of the first guarantee, dated 5 November 2010, read as follows:

“In consideration of Wedzera Petroleum (Pvt) Ltd…, agreeing to the submission of a guarantee for the supply of fuel products by Engen Petroleum Zimbabwe (Pvt) Ltd, we, Infrastructure Development Bank of Zimbabwe – IDBZ…, do hereby guarantee full payment of USD500,000.00…, being the total amount of the Bank Guarantee to Engen Petroleum Zimbabwe (Pvt) Limited. The payment of the USD500,000 will be after a period of 10 (ten) days from the date of fuel drawdown and is on revolving basis…,.”

The second guarantee, dated 19 November 2010, read as follows:

“In consideration of Wedzera Petroleum (Pvt) Ltd…, agreeing to the submission of a guarantee for the supply of fuel products by Engen Petroleum Zimbabwe (Pvt) Ltd, we, Infrastructure Development Bank of Zimbabwe – IDBZ…, do hereby guarantee full payment of USD450,000…, being the total amount of the Bank Guarantee to Engen Petroleum Zimbabwe (Pvt) Limited. The payment of the USD450,000 will be after a period of 10 (ten) days from the date of fuel draw-down and is on revolving basis…,.”

After the guarantees had been issued, Wedzera Petroleum failed to pay the debts arising from the petroleum products which were sold to it on credit by the respondent.

On 8 March 2011, Wedzera Petroleum wrote to the respondent informing that it (Wedzera Petroleum) was experiencing negative cash flows due to the unavailability of fuel during the months of December 2010 and January 2011 and that it was aware of its indebtedness to the respondent. Wedzera Petroleum further informed the respondent that it would pay its entire indebtedness within 14 days.

Wedzera Petroleum failed to honour its indebtedness as promised.

The respondent wrote to the appellant on 15 March 2011 informing it to liquidate Wedzera Petroleum's debt in accordance with the two guarantees.

The appellant, through a letter dated 31 of March 2011, informed the respondent that upon checking its records it found that it had not issued the guarantees in favour of the respondent against any debts incurred by Wedzera Petroleum. The appellant further informed the respondent that it was unsure of the circumstances under which the purported guarantees had been drafted and issued to the respondent on behalf of Wedzera Petroleum.

Following the failure by Wedzera Petroleum to make due payment of the debt, and the repudiation of the guarantees by the appellant, the respondent issued summons against Wedzera Petroleum and the appellant for the payment of the sum of US$847,847=65.

PROCEEDINGS BEFORE THE COURT A QUO

In the court a quo, Wedzera Petroleum, in its plea, admitted its indebtedness to the respondent but denied liability as it argued that liability had passed to the appellant who undertook to settle the debt due in terms of the two guarantees.

The appellant, in its plea, denied being indebted to the respondent at all. It indicated that according to their records there was no indication that Wedzera Petroleum had applied for, or had been granted any guarantees. It further alleged that the guarantees had been generated through fraud.

At the pre-trial conference, the main issue which was referred to trial was: whether or not the appellant was liable to pay Wedzera Petroleum's debt on the basis of the two guarantees.

At the trial, Wedzera Petroleum was in default. The court a quo, upon application from the respondent, granted default judgment against Wedzera Petroleum in favour of the respondent for the sum of US$847,847=65 together with costs of suit and interest at the prescribed rate.

The trial proceeded against the appellant.

In analysing closing submissions made by counsel, the court a quo noted that the appellant's counsel sought to introduce a new argument which had not been pleaded.

The argument was based on the fact that the appellant was a statutory corporation which derived its powers from the Infrastructure Development Bank of Zimbabwe Act [Chapter 24:14] and that the provisions of the Companies Act [Chapter 24:03] (“the Companies Act”), which codified the Turquand Rule, could not be applied against the appellant in terms of section 30 of the Infrastructure Development Bank of Zimbabwe Act [Chapter 24:14].

The court held that in spite of the provisions of section 30 of the Infrastructure Development Bank of Zimbabwe Act (IDBZ Act) which made the appellant immune to the provisions of the Companies Act, the actions of Francis Mugwara fell squarely within the scope of the presumptions of ostensible authority.

The court found that Francis Mugwara held a senior position in the Bank; that he had subordinate staff under him; he had access to and used the appellant's stationery. He was the Head of the Short Term Loans Unit which Unit had, amongst others, a mandate to issue guarantees.

The court further found that Francis Mugwara's job description empowered him: “…, to generate, manage and control the Bank's short-term lending portfolio as well as [to] supervis[e]…, Regional Offices.”

Further, that his key duties included decision making authority, authority to approve departmental expenses and the budgets for the Unit and the Regional Offices.

The court found that the onus was on the appellant to prove that Francis Mugwara did not have any form of authority to facilitate guarantees and to prove any form of fraud and bribery on his part.

The court found the appellant liable to the respondent for the guarantees which were issued by Francis Mugwara in respect of Wedzera Petroleums's indebtedness. The appellant was thus ordered to pay the respondent the sum of US$847,847=65, or the remaining amount after payment was made by Wedzera Petroleum, together with costs of suit and interest at the prescribed rate from the date of the granting of the judgment to the date of payment.

PROCEEDINGS ON APPEAL

Aggrieved by the findings of the court a quo the appellant noted this appeal on the basis of the following grounds of appeal:

(i) Having found, as it did, that there was no conclusive evidence to establish that one Francis Mugwara had authority to issue the two guarantees relied upon by the respondent on his single signature, the court a quo erred in law in placing a further negative onus of proof on the appellant to establish that one Francis Mugwara had no such authority.

(ii) Having found, as it did, that there was no conclusive evidence to establish that one Francis Mugwara had authority to issue the two guarantees relied upon by the respondent on his single signature, the court a quo erred and misdirected itself on the facts, and in law, in finding, as it did, that Francis Mugwara had actual and/or implied authority to issue the two guarantees relied upon by the respondent in its cause of action.

(iii) The court a quo erred and misdirected itself in law in finding the appellant liable to the respondent on the basis of ostensible authority when such was not pleaded by the respondent in the Summons and Declaration.

(iv) The court a quo grossly erred and misdirected itself on the facts in finding, as it did, or must be taken to have done that the appellant represented to third parties, in particular to the respondent, that one Francis Mugwara had authority to issue the guarantees relied upon by the respondent in its cause of action.

(v) The court a quo erred in law in failing to find that the two guarantees relied upon by the respondent were fraudulently procured and thereafter tendered to the respondent by Wedzera Petroleum (Private) Limited, and, as such, no liability could flow from such fraudulent instruments.

(vi) The court a quo erred on the facts and in law in finding, as it did, that the respondent had acted diligently in accepting the two guarantees tendered to it by Wedzera Petroleum (Private) Limited in the absence, inter alia, of any facility between the appellant and Wedzera Petroleum (Pvt) Ltd.

(vii) The court a quo erred on the facts and in law in failing to find that the conduct of Francis Mugwara, in purporting to issue the two guarantees in the absence, inter alia, of any facility agreement between the appellant and Wedzera Petroleum (Pvt) Ltd and/or the respondent not only offended the internal processes of the appellant but also the procedure set out in the Infrastructure Development Bank of Zimbabwe Act [Chapter 24:14]. Consequently, the court a quo ought to have found that his conduct was a legal nullity and no liability attached to the appellant.

(viii) The court a quo erred in law in effectively finding the appellant liable on the two guarantees on the basis of the Turquand Rule when the application of such rule is specifically ousted by the provisions of section 30 of the Infrastructure Development Bank of Zimbabwe Act.

In my view, it is apparent from the appellant's grounds of appeal that three issues arise for determination. These are the following:

A. Whether or not the court a quo erred in finding that Francis Mugwara had authority to issue the two guarantees relied upon by the respondent.

B. Whether or not the court a quo erred in finding the appellant liable to pay the respondent on the basis of ostensible authority.

C. Whether or not the appellant was liable to pay the respondent on the basis of the Turquand Rule when such was never pleaded by the respondent in its summons and declaration.

I will proceed to deal with each of these issues.

Whether or not the court a quo erred in finding that Francis Mugwara had authority to issue the two guarantees relied upon by the respondent

The appellant argued that Francis Mugwara's contract of employment did not give him authority to act on behalf of the Bank. It also submitted that the court a quo erred in its factual findings to the effect that he had implied authority to act on behalf of the appellant.

In order to fully understand the authority Francis Mugwara possessed there is need to make reference to his key duties in the Bank.

Francis Mugwara held the title of the 'Head of Short Term Loans'. Under this title, he was the second in charge after the office of the Director of Private Sector Projects as shown from the organogram of the Short Term Loans Unit. A summary of Francis Magwara's job was stated as:

“To generate, manage, and control the Bank's short term lending portfolio as well as supervision of Regional Offices.”

Among his key tasks was “marketing of Bank products to achieve bankable portfolio of clients, disbursements of funds on approved facilities, and making presentations to the Private Sector Projects Committee (PSPC) on projects for approval.”

In addition, Francis Mugwara's job description had an incidental clause on error of judgment and the consequences which would affect the Bank if the Head of Short Term Loans made a wrong decision. The clause stated as follows:

“Catastrophic as bad decisions can lead to the insolvency of the Bank through the creation of a Bad Loan portfolio. Reputation of the Bank can be on the line if prompt and correct decisions are not made.”

The court made factual findings that Francis Mugwara had authority to act on behalf of the appellant. The court a quo noted the following:

“…, notwithstanding the Bank's argument that Mugwara's power might have been limited, I find that as much as between himself and the Bank, Mugwara had actual or implied authority to issue those guarantees. I find that as between Engen and the Bank, Mugwara had ostensible authority to issue the guarantee and to bind the Bank to third party recipients.”

A clear reading of Francis Mugwara's key tasks shows that he worked under a Unit which controlled the manner in which guarantees were issued. He was the senior personnel in the Bank as he was second in command from the Director of the Unit. He had access and control of the appellant's stationery to an extent that he had business cards to identify himself. He had the task of marketing Bank products and disbursements of funds on approved loan facilities.

The court a quo found that on these factual findings the key tasks done by Francis Mugwara were enough evidence to show that he had authority to act on behalf of the appellant.

The court a quo also took into account that although criminal proceedings were instituted against Francis Mugwara by the appellant, on the basis of fraud and bribery, the office of the Prosecutor General refused to prosecute the matter on the basis that it was a labour matter. That, in any event, the appellant had failed to provide adequate evidence to sustain a conviction.

The court a quo, in determining the impact of the criminal charges laid against Francis Mugwara, found that the onus to prove fraud and bribery was on the appellant and that the prosecutor had failed to prove that Francis Mugwara had been fraudulent or had received any bribe.

The proof to be proffered by the appellant for fraud and bribery in casu would be proof on a balance of probabilities as the fraud and bribery were being alleged in a civil trial after the criminal charges had failed to materialise.

Proof in civil proceedings is always on a balance of probabilities.

In the case of Zimbabwe Electricity Supply Authority v Dera 1998 (1) ZLR 500 (SC), the court stated the following:

“…, in a civil case, the standard of proof is never anything other than proof on the balance of probabilities. The reason for the difference in onus between civil and criminal cases is that in the former the dispute is between individuals, where both sides are equally interested parties. The primary concern is to do justice to each party, and the test for that justice is to balance their competing claims.

In a criminal matter, on the other hand, the trial is an attack by the State, representing society, on the integrity of an individual. The main concern is to do justice to the accused. If the prosecution fails, the State does not lose.”

Francis Mugwara, having admitted that he issued the guarantees and having alleged that he did so lawfully, it was for the appellant to prove all the allegations laid against him of fraud and bribery.

The appellant did not adduce any proof to the contrary, but, rather, stood on the argument that he had no authority to individually sign a guarantee.

The appellant produced sample guarantees which it alleged were lawfully facilitated for other parties. These sample guarantees were juxtaposed with the guarantees which Francis Mugwara had facilitated and affixed a single signature instead of two signatures as appeared on the sample guarantees. The appellant argued that the fact that the guarantees issued on behalf of Wedzera Petroleum were not counter-signed meant that the guarantees were fake and invalid.

Sample guarantees produced before the court a quo showed that Francis Mugwara would countersign a guarantee with other personnel of the Bank. It is of importance to note, however, that such other personnel would be junior personnel and Francis Mugwara would counter sign to give effect to the validity of the guarantee facilitated by his subordinates.

It thus could not have been extensively irregular that on the two guarantees made in favour of the respondent Francis Mugwara signed the guarantees with no other counter signature as he was the head of the Unit from which such guarantees originated.

The arguments raised by the appellant, that absence of a second signature rendered the guarantees ineffective, thus lacks merit.

The appellant did not adduce any evidence to show that the facilitation of the guarantee was not carried out in-house. The appellant's witnesses could have brought the register for credit facilities issued by the Bank to show that no entry was ever made in favour of Wedzera Petroleum to the respondent.

Francis Mugwara vehemently denied that he had not followed proper procedures in processing the guarantees and stated that records of the guarantees were with the appellant.

In examination in chief, Francis Mugwara admitted to having recorded the guarantees in the Bank's register. The court a quo, in assessing these facts, found that:

“The evidence on whether or not Mugwara could issue guarantees on his single signature was inconclusive. Mugwara said he could. The Bank said he could not. The onus was on the Bank to prove that he could not. It did not refute, satisfactorily, Mugwara's claim that it was only guarantees initiated by subordinates that required to be counter-signed for validity. I find that the Bank failed to discharge the onus on such a key aspect of defence.”

In finding that Francis Mugwara had authority to act on behalf of the appellant, the court a quo made reference to the incidental clause in his job description document. A reading of the clause shows that Francis Mugwara, as the Head of Short Term Loans, had to take due diligence and not make an error of judgment as such error in creating a bad loan portfolio would have catastrophic consequences which could lead the appellant to insolvency.

This clause, in itself, crystalizes the point that he had authority to act on behalf of the appellant in a manner which could extend to issuing guarantees. Only a senior officer of the Bank could possess authority to act on its behalf to an extent where an error of judgment would lead to catastrophic results.

It is a settled principle that this Court will not easily interfere with factual findings made by a lower court unless the findings are grossly unreasonable. See ZINWA v Mwoyounotsva 2015 (1) ZLR 935 (S); Hama v NRZ 1996 (1) ZLR 664 (S); Reserve Bank of Zimbabwe v Corrine Granger and Another SC34-01.

The lower court enjoys the opportunity to see the witnesses on the stand, assess their demeanour and credibility. Such findings of fact cannot easily be interfered with by an Appellate Court as it is limited to the record of proceedings. See Mtimukulu v Nkiwane and Another SC136-01.

It is my view that the court a quo's factual findings cannot be impugned.

Francis Mugwara was a senior employee who could carry out credit facilitation and represent the appellant.

All the above findings lead to the inescapable conclusion that the court a quo's factual findings were correct.

The next inquiry that arises from this finding is the extent of the authority Francis Mugwara had in issuing the guarantees to the respondent; that is, whether or not it was implied or express authority.

Whether or not the court a quo erred in finding the appellant liable to pay the respondent on the basis of ostensible authority

The court a quo found that the authority exercised by Francis Mugwara, in issuing the guarantees, was implied (apparent or ostensible) authority.

The respondent based its arguments for the claim of payment of the guarantees on the ostensible authority which had been exercised by Francis Mugwara. Counsel for the respondent submitted that it was on the basis of this apparent authority exercised in the issuing of the guarantees that the respondent agreed to issue Wedzera Petroleum fuel.

It was the appellant's argument that no such implied authority existed and that on the basis of Francis Mugwara's job description such authority was not given to him.

The appellant also argued that in terms of the Bank's Lending Policy, Francis Mugwara did not have authority to single-handedly facilitate a credit facility, sign it, and issue it without proper procedure being followed.

Ostensible authority, or apparent authority, exists where an agent's words or conduct lead a reasonable person in a third party's position to believe that the agent is authorized to act, even if the principal and the purported agent have never discussed such a relationship.

The effect and meaning of ostensible authority was discussed in Makate v Vodacom Ltd 2016 (4) SA 121 (CC)…, in which the case of Hely-Hutchinson CA v Brayhead Ltd and Another [1968] 1 QB 549 (CA)…, was referred to with approval. The court stated the following:

“Actual authority and ostensible or apparent authority are the opposite sides of the same coin. If an agent wishes to perform a juristic act on behalf of the principal, the agent requires authority to do so, for the act to bind its principal. If the principal had conferred the necessary authority, either expressly or impliedly, the agent is taken to have actual authority. But, if the principal were to deny that she had conferred authority, the third party who concluded the juristic act with the agent may plead estoppel in replication.

In this context, estoppel is not a form of authority but a rule to the effect that if the principal had conducted herself in a manner that misled the third party into believing that the agent has authority, the principal is precluded from denying that the agent had authority.”

The court went on to state the importance of ostensible authority and made the following remarks..,.:

“The concept of apparent authority, as it appears from the statement by, Lord Denning, was introduced into law for purposes of achieving justice in circumstances where a principal had created an impression that its agent has authority to act on its behalf.

If this appears to be the position to others, and an agreement that accords with that appearance is concluded with the agent, then justice demands that the principal must be held liable in terms of the agreement.

It cannot be gainsaid that, on present facts, there is a yearning for justice and equity.”

In Rama Corporation Ltd v Proved Tin and General Investments Ltd [1952] 2 QB 147, SLADE J noted as follows:

“Ostensible or apparent authority which negatives the existence of actual authority is merely a form of estoppel; indeed, it has been termed agency by estoppel, and you cannot call in aid an estoppel unless you have three ingredients:

(i) A representation;

(ii) A reliance on the representation; and

(iii) An alteration of your position resulting from such reliance.”

See also Freeman and Lockyer v Buckhurst Park Properties (Mangal) Ltd [1964] 2 QB 480.

Ostensible authority thus binds a principal over actions done by its agent with relation to third parties. Such principal can thus be estopped from denying liability of the actions of the agent.

In casu, Francis Mugwara was an agent of the appellant; he was the head of the Short-Term Loans Unit and had subordinates under him. His key duties included a mandate to approach companies and commercial institutions in a bid to facilitate that these companies and institutions acquired loan facilities from the appellant.

It was not in dispute that at the time the two guarantees were issued to the respondent on behalf of Wedzera Petroleum, the appellant was running off-balance sheet facilities due to the economic situation which was prevailing in the country at that time. On the basis of such off balance sheet facilities the appellant would issue credit facilities to finance different business ventures.

It is important to note that the first encounter under which Francis Mugwara and the respondent met was not on the issuance of the guarantees. Francis Mugwara had previously made presentations before Mr Mudzengerere, who was the respondent's Managing Director. Francis Mugwara approached the respondent to issue the guarantees on fuel procurement and disbursement. The intended business venture between Francis Mugwara and the respondent did not materialise at that time but a relationship had been formed.

It thus cannot be taken as being irregular that, upon being presented with the guarantees in favour of Wedzera Petroleum, for fuel allocation, Mr Mudzengerere, on behalf of the respondent, accepted these guarantees.

The respondent duly accepted the guarantees on the basis of the conduct and representations which had been made by Francis Mugwara - even before Wedzera Petroleum sought a credit facility from the appellant.

The respondent's cause of action against the appellant, for payment, was on the basis of ostensible authority which had been exercised by Francis Mugwara.

The court a quo duly made factual findings on the exercise of this authority. Clearly, there is nothing illogical or unreasonable from the court a quo's findings.

Francis Mugwara confirmed that he had authority to carry out his duties and the respondent could not be faulted for honouring the guarantees which were issued on behalf of the appellant by its Head of Short Term Loans.

The court a quo found Francis Mugwara to be a reliable witness.

On the basis of the above finding it is therefore my view that the appellant is liable to pay the respondent the sums of money arising from the guarantees.

View Appeal
HH253-16 : ENGEN PETROLEUM ZIMBABWE [PVT] LTD vs WEDZERA PETROLEUM [PVT] LTD and INFRASTRUCTURE DEVELOPMENT BANK OF ZIMBABWE
Ruled By: MAFUSIRE J

This was a civil trial. The first defendant [“Wedzera”] was in default. On application by the plaintiff [“Engen”] in respect to which the second defendant [“the Bank” or “IDBZ”] had nothing to say, I entered a default judgment against Wedzera, in favour of the plaintiff, in the sum of $847,847=65, together with costs of suit and interest at the prescribed rate.

Most of the material facts were common cause.

Engen was an oil company. It sold bulk fuels. Wedzera operated filling stations at which it retailed fuels. IDBZ was a statutory corporation set up in terms of its enabling Act, the Infrastructure Development Bank of Zimbabwe Act [Chapter 24:14] [“IDBZ Act”].

Engen's claim arose out of petroleum fuels sold and delivered to Wedzera in terms of an agreement between them. Wedzera had failed or neglected to pay. Engen claimed IDBZ had guaranteed the due payment by Wedzera up to an amount in the sum of $950,000. That amount was made up of two guarantees, one for $500,000 and the other for $450,000.

But, IDBZ disowned them. It argued that one of its ex-employees had issued them fraudulently or without authorisation.

Engen called two witnesses.

The first, Johannes Mudzengerere [“Mudzengerere”] had been Engen's Managing Director at the relevant time. He had been in charge of Engen's entire operations, including the procurement and disposal of fuel stocks.

Engen's second witness, Francis Mugwara [“Mugwara”], was the man at the centre of the guarantees. He had been subpoenaed just before the trial commenced. He was the one who had signed and issued the impeached guarantees. Figuratively, and perhaps not unexpectedly, the Bank sought to lynch him.

For the Bank, there were also two witnesses.

At the relevant time, Norbert Munengwa [“Munengwa”] had been an Assistant Director in charge of a unit or division called Private Sector Projects. He reported to the Chief Executive Officer. His portfolio covered the crafting of strategies, policy formulation, and business development. Within that sector Francis Mugwara had, at all relevant times, been the Head of the unit called Corporate Banking. It was formerly called the Short Term Loans Unit. He had joined it as Assistant Head, and had subsequently been promoted. He reported to Norbert Munengwa.

The Bank's second witness was Desmond Matete [“Matete”]. He was a qualified lawyer. At the relevant time he was the Director for Legal and Corporate Services. Amongst other duties, he was the custodian of the Bank's legal documents.

There was much convergence, or little controversy, on such key aspects of the evidence as would, in my view, decide the matter. Differences were mainly on peripheral issues and on the parties' application of the law to the facts.

Wedzera used to buy bulk fuels from Engen for cash. As its sales increased, it wanted more fuels - but on credit. Engen obliged. Wedzera signed Engen's standard credit facility application form. Johannes Mudzengerere ran it past Engen's agent for credit rating. He also sought and obtained clearance from Engen's head office in South Africa. Everything seemed in order.

Wedzera had to provide a Bank guarantee to guarantee the due payment for the fuels. These came from IDBZ.

During this period, 2010, the country's economy had just “dollarized”. A multi-currency system had been introduced following the demise of the local currency. Most companies' balance sheets had almost reduced to zero. As a re-capitalisation strategy, the Bank had decided to offer non-traditional or non-generic products that either avoided or minimised direct cash outlays, or that brought in quick income. The witnesses said the Bank was trading off-balance sheet. The Bank's new strategy concentrated on non-direct cash products such as short to medium term loans, Bankers' acceptances, Bills discounting and Bank guarantees. This strategy also involved the bulk importation of petroleum products and the procurement of fertilisers for disposal on the local market.

The Bank had set up a body known as the Private Sector Projects Committee [“the PSPC”]. This committee would grant global approvals and cap the upper monetary limits for any new projects. The members of this committee were the Bank's senior officials, including Norbert Munengwa and Desmond Matete. But heads of divisions, such as Francis Mugwara, were also members. Francis Mugwara was a member.

It was common cause that Francis Mugwara had the Bank's authority to market this new strategic innovation. He had the authority to procure new business, to manage, and grow it.

The point of departure between Francis Mugwara, on the one side, and Nobert Munengwa and Desmond Matete on the other, was the extent of Francis Mugwara's authority - specifically with regards to the issuing of guarantees.

Francis Mugwara claimed he had the authority to issue guarantees in favour of third parties and binding on the Bank, for as long as the amounts on them did not exceed the limits set by the Private Sector Projects Committee (PSPC). He claimed he could issue such guarantees on his single signature. He had access to the Bank's stationery - including sample guarantee forms. He managed Harare, Bulawayo and other towns. He was in charge of all staff falling under his unit. He insisted he had complied with all the standard operating procedures, not least opening an account for Wedzera and issuing it with a facility letter; raising bank charges and completing all other relevant documents. He claimed all the paper work had been placed in the relevant Bank records which Desmond Matete kept. He challenged Desmond Matete to produce those records.

Of some guarantees that were produced in evidence bearing two signatures and which the Bank gave as an example of what a valid guarantee was like, Francis Mugwara said these had been initiated by his subordinates who also had the authority to issue guarantees. However, guarantees by subordinates had to be countersigned by himself, as head of the unit, or else they would be invalid.

Nobert Munengwa and Desmond Matete vehemently disputed that Francis Mugwara could issue guarantees on his single signature and bind the Bank. They said all the Bank's guarantees had to be counter-signed. They said there were elaborate internal standard operating procedures. These had to be followed at all times that the Bank would offer any credit facility to anyone. Of the two guarantees in question, and some two others that Francis Mugwara had also issued on his single signature in favour of other third parties, Nobert Munengwa and Desmond Matete said they were invalid for lack of authority. They had never been brought up to the Private Sector Projects Committee (PSPC) for specific approval.

Nobert Munengwa and Desmond Matete also accused Francis Mugwara of fraud. They said when they had confronted him after Johannes Mudzengerere had called up the guarantees and was pressing for payment, Francis Mugwara had broken down and confessed to having been paid by Wedzera's Managing Director, one Eric Nhodza [“Nhodza”], an amount in the sum of $10,000 in return for the guarantees. The Bank had raised misconduct charges against him. However, he had ducked out of the disciplinary process by resigning.

Francis Mugwara denied the fraud. He denied the confession. He maintained he had issued the guarantees within the scope of his mandate.

It was common cause that the Bank had reported Francis Mugwara to the police. However, it was also common cause that the State had declined to prosecute for lack evidence.

For Engen, Johannes Mudzengerere said his first encounter with Francis Mugwara was when, a few days before the guarantees, Francis Mugwara had arrived at his office offering Engen two million litres of fuel. Francis Mugwara had introduced himself as the Bank's Head of Corporate Unit. He had produced his business card. However, the fuel deal had subsequently fallen through. When Wedzera was increasing its fuel purchases and was asking for supplies on credit, Johannes Mudzengerere had required the provision of security in the form of assets or guarantees from a reputable Bank. A few days later a Wedzera representative and Francis Mugwara had returned to Johannes Mudzengerere's office with a sample guarantee from IDBZ. Johannes Mudzengerere had been satisfied with the wording. He had been comfortable with IDBZ as a “Government Bank”.

The first guarantee had been issued. It was for $300,000. Engen never had to call it up. Wedzera had paid in accordance with the agreement. Wedzera had further increased its fuel purchases. It had provided further guarantees from IDBZ for $500,000 and $450,000.

It was on these last two guarantees that the case before me was all about. Wedzera had failed to pay. Its debt at the time of the default stood at $847,847=65. That was the amount claimed in the summons.

There was no issue about the wording of the guarantees.

When Johannes Mudzengerere called up the guarantees, Francis Mugwara got in touch with Wedzera. Wedzera wrote something to assuage Engen. Johannes Mudzengerere was un-impressed. He pressed for payment. Eventually, he got through to Nobert Munengwa. Nobert Munengwa disowned the guarantees. The Bank's position was that Wedzera was not, and had never been, a customer of the Bank. Among other things, and contrary to standard operating procedures, there was no record of any account having been opened for Wedzera before or after the guarantees had been incepted. No bank charges had been raised as fees for the guarantees. There was simply no paper trail relating to them. As far as the Bank was concerned, the purported guarantees had been an abuse of the Bank's stationery by Francis Mugwara. They were invalid.

Having faced a brick wall, Engen sued. That was essentially the case before me.

Counsel for the plaintiff argued that the Bank's defence was misconceived. From the facts, Francis Mugwara had the actual authority to issue the guarantees in question. He was the Head of the Bank's unit that had the requisite mandate to issue such type of Bank products. Francis Mugwara's contract of employment empowered him to issue such guarantees. Counsel for the plaintiff further argued that if it should be said that Francis Mugwara had no actual authority to issue the guarantees, then he undoubtedly had ostensible authority. The Bank had held him up as one with such authority. He had started off as Assistant Head in the Short Term Loans Unit. He had interacted with the public in that capacity. This unit had subsequently changed its name to Corporate Banking. Francis Mugwara had subsequently been promoted to head it. All this had been in the eyes of the public.

Counsel for the plaintiff highlighted that Francis Mugwara had access to the Bank's stationery. It had provided him with business cards, obviously to assist in the marketing of its products. One such product had been the non-generic, off balance sheet facility that involved minimal cash outlay. There were also other innovations, such as the non-traditional trade in fuels and fertilizers. Francis Mugwara had been mandated to market and manage them. Third parties, like Engen, could hardly be faulted for accepting Francis Mugwara's authority and his guarantees. Nothing warned them that he might be unauthorised. That he might have breached the Bank's in-house standard operating procedures, or that he might have exceeded the bounds of his authority, could not dis-entitle Engen from holding the Bank to the guarantees.

Counsel for the Bank explored Francis Mugwara's contract of employment in some detail and argued that nothing said therein could be said to amount to authority for Francis Mugwara to issue such guarantees on his single signature.

Counsel for the Bank further explored the Bank's standard operating procedures and concluded that Mr Mugwara had manifestly breached all the important check-lists. Among other things, Wedzera had never been a customer of the Bank. There was nothing on record to show that any of the account opening and account operating procedures had been put in place. No fees had been raised. No facility letter had been issued. No customer vetting had been done. The guarantees had never been brought up to the Private Sector Projects Committee (PSPC) for approval. There was not a single meeting convened for this business, let alone any minutes taken in respect of it.

To the Bank, Francis Mugwara was just a rogue.

He had taken a bribe for $10,000 in return for the guarantees. When confronted by Messrs Nobert Munengwa and Desmond Matete, he had confessed. To avoid disciplinary action he had simply resigned. He had an axe to grind with the Bank. He had been blacklisted and was no longer employable in the finance industry.

According to counsel for the Bank, Francis Mugwara had neither the actual nor the ostensible authority to issue those guarantees. Engen had been negligent in accepting them without verification. It should have checked with the Bank for their authenticity. On this particular point, Desmond Matete claimed, in his evidence, that it was the practice and custom in the capital markets that a third party who is given a guarantee, such as the type Francis Mugwara had issued, would run them past its own bankers. The bankers would know how to go about verifying them for authenticity.

Counsel for the Bank discredited Engen's credit rating process of Wedzera. He pointed out that on the credit facility application form, the Standard Chartered Bank, not IDBZ, had been listed as Wedzera's bankers. If Engen had been diligent or prudent enough, it should have been suspicious to be receiving from Wedzera guarantees from IDBZ instead of the Standard Chartered Bank.

In his closing submissions counsel for the Bank sprang a new argument. It had not been pleaded. It had never been referred to before.

It was that the Bank was a statutory corporation the powers of which were set out in its enabling Act. In summary, counsel for the Bank's new argument was that anyone could check what the Bank could or could not do. Among other things, only the Bank's Board and its Chief Executive Officer had the sole mandate to represent the Bank. Francis Mugwara's conduct had been in contravention of the law.

Counsel for the Bank quoted section 21 of the Infrastructure Development Bank of Zimbabwe Act [Chapter 24:14] (IDBZ Act) in extenso. It sets out the procedures and requirements for financing by the Bank. Among other things, there can be no financing for any project without the Bank's Board having first considered it. An elaborate procedure is then set out on how the Board may go about considering a proposal for funding; what sort of things it must look for, and what conditions it may prescribe if the proposal is approved. It was argued that Francis Mugwara, not having followed, or caused to be followed, the statutory procedures, his guarantees were ultra vires the Infrastructure Development Bank of Zimbabwe Act, manifestly void, and, therefore, unenforceable.

Inevitably, reference was made to LORD DENNING'S seminal statement in McFoy v United Africa Co. Ltd [1961] 3 All ER 1169 [PC]…,; If an act is void, then it is a legal nullity. Such an act is not only bad, but also incurably so. There is no need for an order of court to set it aside. Every proceeding founded on it is also incurably bad:

“You cannot put something on nothing and expect it to stay there. It will collapse.”

Counsel for the Bank also referred to section 30 of the Infrastructure Development Bank of Zimbabwe Act (IDBZ Act). By this provision, the Bank is made immune from the provisions of the Companies Act [Chapter 24:04], or of any other law relating to companies.

This has huge significance.

Section 12 of the Companies Act codifies the common law rule of Company Law, also known as the Turquand Rule, after the 19th century English case of Royal British Bank v Turquand (1856) 6 E & B 327; (1843-60) 119 ER 886 in which the rule was first succinctly expounded.

This rule says that any person dealing with a company is entitled to make certain assumptions, such as that the company's internal regulations have been duly complied with. The company is estopped from denying the truth of such assumptions. Anyone is entitled to assume that every person whom the company represents to be its officer or agent has been duly appointed and has authority to exercise the functions customarily exercised by him: see Mills v Tanganda Tea Company Ltd 2013 [1] ZLR 38 [H]…,.

In terms of section 13 of the Companies Act, a company shall be bound in terms of section 12 notwithstanding that the person held out to be the officer or agent for it might have acted fraudulently or forged a document purporting to be sealed or signed on behalf of the company.

Plainly, but for section 30 of the Infrastructure Development Bank of Zimbabwe Act [Chapter 24:14] (IDBZ Act), the Bank could never have mounted the kind of defence that it did herein, for Francis Mugwara's actions fell squarely within the scope of the presumptions of regularity prescribed by section 12 of the Companies Act.

However, in spite of the ousting by section 30 of the Infrastructure Development Bank of Zimbabwe Act (IDBZ Act) of the provisions of the Companies Act and any other law relating to companies; in spite of such further provisions of the Infrastructure Development Bank of Zimbabwe Act as may repose in the Bank's Board the sole power to represent it and to consider all funding proposals, and, furthermore, notwithstanding the Bank's argument that Francis Mugwara's powers might have been limited, I find that, as between himself and the Bank, Francis Mugwara had actual or implied authority to issue those guarantees. I find that as between Engen and the Bank, Francis Mugwara had ostensible authority to issue the guarantees and to bind the Bank to third party recipients.

LORD DENNING MR, in Hely-Hutchinson v Brayhead Ltd & Another [1968] 1 QB 549; [1967] 3 All ER 98 [CA] [quoted with approval by MPATI P in Northern Metropolitan Coal Council v Company Unique Finance [Pty] Ltd & Ors 2012 [3] All SA 498 [SCA]…, explained actual or implied authority as follows:

“[Actual authority] is express when it is given by express words, such as when a Board of Directors pass a resolution which authorises two of their number to sign cheques. It is implied when it is inferred from the conduct of the parties and the circumstances of the case, such as when the Board of Directors appoint one of their number to be Managing Director. They thereby impliedly authorise him to do all such things as fall within the usual scope of that office.”

BEADLE CJ, in Reed NO v Sager's Motors (Pvt) Ltd [1969] [2] RLR 519 [AD]…,; 1970 [1] SA 521 [RAD] [quoted with approval in Seniors Service [Pvt] Ltd v Nyoni 1986 [2] ZLR 293 [SC]] explained apparent or ostensible authority as follows:

“The word 'ostensible', in the Rhodes Motor Company case (1965 (4) SA 40), is used in the sense of 'apparent' and in the language of the law of agency these two terms are synonymous.

If a principal employs a servant or agent in a certain capacity, and it is generally recognised that servants or agents employed in this capacity have authority to do certain acts, then any of those acts performed by such servant or agent will bind the principal because they are within the scope of his 'apparent' authority. The principal is bound even though he never expressly or impliedly authorised the servant or agent to do these acts, nor had he by any special act [other than the act of appointing him in this capacity] held the servant or agent out as having this authority.

The agent's authority flows from the fact that persons employed in the particular capacity in which he is employed, normally have authority to do what he did.”

The principles that emerge from case authority in relation to the ostensible authority of employees in general, and Bank managers in particular, are that the principal [the employer] must have created an impression in the mind of the third party, even though that impression might be wrong, that his agent [the employee] had the requisite authority to transact on behalf of the principal. The third party must show a representation by words or conduct by the principal, not merely by the agent. The representation must have been in such form as would reasonably lead outsiders to act on the strength of it to their prejudice.

The court considers the façade of regularity of the employee's actions purporting to act on behalf of the employer, given all the trappings of his appointment as set in a context....,.

Francis Mugwara's job description empowered him “to generate, manage and control the Bank's short term lending portfolio as well as [to] supervis[e]…, Regional Offices.”

Expressly, he was tasked with ensuring that his unit achieved its set business volumes, and, significantly, he was also tasked with the “disbursements of funds on approved facilities.”…,.

Among Francis Mugwara's key decision making authority aspects was the approval of departmental expenses and the budgets for the Unit and the Regional Offices.

There was one further subtle detail on Francis Mugwara's job description.

Listed as one of the consequences of an error of judgment on his part in relation to, for example, financial/material loss, etc., i.e. what could happen to the organization if he made a wrong decision or failed to perform his job, was this:

“Catastrophic, as bad decisions can lead to the insolvency of the Bank through the creation of a bad Loan portfolio;” and:

“Reputation of the Bank can be on the line if prompt and correct decisions are not made”…,.

During trial, the Bank tried desperately to downgrade Francis Mugwara's position. It tried to strip him of all manner of authority.

I totally disagree.

The evidence on whether or not Francis Mugwara could issue guarantees on his single signature was inconclusive.

Francis Mugwara said he could. The Bank said he could not.

It did not refute, satisfactorily, Francis Mugwara's claim that it was only guarantees initiated by subordinates that required to be counter signed for validity. I find that the Bank failed to discharge the onus on such a key aspect of its defence.

Francis Mugwara was by no means a junior employee. I have found nothing from his contract of employment, or his job description, that precluded him from issuing those guarantees on his single signature.

Admittedly, these documents did not expressly say he could. But, equally, they did not expressly say he could not.

There was simply nothing in them that was specific to any type of product the Bank was offering at the time. But, when one considers, objectively, the overall job description and the trappings of his appointment; when one considers that an error of judgment on his part could lead to the Bank going bankrupt or putting its reputation at risk, I find that the issuing of the guarantees in the manner Francis Mugwara did, fell squarely within the scope of the risk the Bank had assumed when it appointed him to that position.

That, in my view, was implied authority for what Francis Mugwara did....,.

Francis Mugwara's position, as Head of Corporate Banking, who had business cards issued to him by the Bank confirming such status, was not a “nude appointment”. It was an appointment that had to be considered with “all its trappings”: see NBS Bank Ltd v Cape Produce Co [Pty] Ltd & Ors 2002 [1] SA 396 [SCA]; [2002] 2 All SA 262 [SCA].

I find nothing unreasonable in Johannes Mudzengerere's reliance on Francis Mugwara's job description as one who had the requisite authority to issue the guarantees. I find nothing that should have put him on his guard.

HH621-15 : DELTA CORPORATION LTD vs ZIMABWE REVENUE AUTHORITY
Ruled By: HLATSHWAYO J

At the hearing of this matter I dismissed the appeal with costs and indicated that the reasons would follow. These are they.The facts of this case are largely common cause.On 23 May 1996, a firm of accountants, Messrs Deloitte and Touche (hereinafter “Deloitte and Touche”) wrote the following letter to ...

At the hearing of this matter I dismissed the appeal with costs and indicated that the reasons would follow. These are they.

The facts of this case are largely common cause.

On 23 May 1996, a firm of accountants, Messrs Deloitte and Touche (hereinafter “Deloitte and Touche”) wrote the following letter to the then Commissioner of Taxes (COT):

“Dear Sir,

BONUS SHARES (NINTH AND FIFTEENTH SCHEDULES TO THE INCOME TAX ACT)

The above term is not defined in the statute.

We would be grateful if you would advise us whether it is accepted that where a company, in declaring a dividend, allows its shareholders a choice of accepting cash or shares, those who opt for the latter receive “bonus shares”.

Yours faithfully

D and T”

The Commissioner of Taxes (COT) responded, on 8 July 1996, as follows:

“Dear Sirs

BONUS SHARES (NINTH AND FIFTEENTH SCHEDULES TO THE INCOME TAX ACT [CHAPTER 181])

You letter dated 23rd May 1996, reference RHMM/LWH/spw/12080, refers.

Please be advised that where a company declares a dividend which is immediately satisfied by issue of shares of an identical amount, no dividend is paid by the company and such shares constitute bonus shares.

Since there is no distribution of profits by the company and no property passed from the company to shareholders, what company does is to capitalise a portion of its profits. This does not constitute the payment of a dividend for income tax purposes. The fact that the company allows its shareholders an option of accepting cash or shares is not material.

Shares received in lieu of dividend are “bonus shares”.

Yours faithfully

T.I NCUBE (MRS)
For: ACTING COMMISSIONER OF TAXES”

The appellant, apparently acting on the strength of the above letter, did not pay withholding tax on scrip dividends issued subsequent to that letter.

On 24 November 2006, the Commissioner-General (COG) of the Zimbabwe Revenue Authority, who is the successor to the Commissioner of Taxes (COT), wrote to the appellant requesting it to deduct and account for withholding tax for three years prior to that date on scrip dividends issued.

The appellant wrote back, on 5 December 2006, objecting and averred that in 1996 the Commissioner of Taxes (COT) had given a ruling upon the strength of which the appellant had acted. Such ruling, the appellant alleges, is binding on the current respondent.

The respondent disallowed the objection on 30 January 2007 and maintained that the withholding tax was due and payable chiefly because a scrip dividend was a dividend and not bonus shares.

The appellant was aggrieved by the decision and filed the present appeal.

The appellant's case is that the letter by the Commissioner of Taxes (COT) amounts to an advance tax ruling which binds the respondent and suggests that the benefits which are derived from the 1996 letter to Deloitte and Touche accrue to it as well. The appellant also avers that a scrip dividend is equivalent to bonus shares which type of shares are not subject to income tax in terms of the 9th and 15th Schedules to the Income Tax Act [Chapter 23:06]. It is also the appellant's case that a scrip dividend is incorporeal property in lieu of cash. The appellant further contends that it would not be proper for the respondent to demand arrear taxes when it acted in line with an understanding with the Commissioner of Taxes (COT).

The respondent's main line of defence is that the Commissioner of Taxes (COT) letter to Deloitte and Touche, in 1996, did not amount to a tax ruling. Rather, the respondent argues, it was just a confirmation of a position as perceived by Deloitte and Touche. The respondent also avers that if any benefit is to be derived from the said letter, such benefit can only accrue to Deloitte and Touche and not to the present appellant because it was not privy to the communication or transaction between Deloitte and Touche and the Commissioner of Taxes (COT), the respondent's predecessor.

Regarding the standpoint taken by the appellant that the letter from the Commissioner of Taxes (COT) constitutes a tax ruling, one needs to understand the nature and import of an advance tax ruling which is defined in the 4th Schedule to the Revenue Authority Act as “a written statement in the form of a binding general ruling, binding private ruling, and binding class ruling issued by the Commissioner-General regarding the interpretation or application of the relevant Act.”

The procedural requirements for obtaining such a ruling are then spelt out as follows:

“2. Application for Advance Tax Ruling

(1) Subject to the minimum requirements set forth in subparagraph (2), an application for an advance tax ruling must be made in such manner and in such form as the Commissioner General may prescribe, and be accompanied by the fee charged in terms of paragraph 18 of the Second Schedule, if any.

(2) An application must state the following minimum information —

(a) The applicant's name, postal address, and telephone number; and

(b) The name, postal address, and telephone number of the applicant's representative, if any; and

(c) A complete description of the proposed transaction in respect of which the ruling is sought; and

(d) A complete description of the impact the proposed transaction may have upon the tax liability of the applicant, or, where relevant, any connected person in relation to the applicant, including any and all relevant information regarding the financial or tax implications of the proposed transaction; and

(e) A complete description of any transactions entered into by the applicant prior to submitting the application or that may be taken after the completion of the proposed transaction which may have a bearing on the tax consequences of the proposed transaction or may be considered to be part of a series of transactions involving the proposed transaction; and

(f) The proposed ruling being sought; and

(g) A citation of the relevant statutory provisions or issues; and

(h) The reasons why the applicant believes that the proposed ruling should be made; and

(i) A statement of the applicant's interpretation of the relevant statutory provisions or issues, as well as analysis of any relevant authorities either considered by the applicant or of which the applicant is aware, whether those authorities support or are contrary to the proposed ruling being sought; and

(j) A statement, to the best of the applicant's knowledge, that the same or substantially the same or substantially similar issue upon which a ruling is sought is not the subject of an audit, examination, investigation, ruling, application, objection and appeal, or other proceeding currently before the Commissioner-General or the courts involving the applicant or a connected person in relation to the applicant; and

(k) A draft version of the binding private ruling or binding class ruling to be issued; and

(l) A description of the information that the applicant believes should be deleted from the final ruling before the publication of the ruling in order to protect the applicant's confidentiality; and

(m) The applicant's consent to the publication of the ruling by the Commissioner General.

(3) In addition to the minimum information required by subparagraph (2), an application for a binding class ruling must also state the following minimum information —

(a) A description of the class members concerned; and

(b) The impact the proposed transaction may have upon the liability of the class members, or, where relevant, any connected person in relation to the applicant or any class member.

(4) The Commissioner-General may request additional information from an applicant at any time.”

The wording of the above section is peremptory and it is patently conjunctive. All those requirements must be present for any enquiry to be classified as an application for a tax ruling.

Once the inquiry made is lacking in one or more material respects, it cannot be said to be an application for a tax ruling, and, in the absence of such application, any correspondence from the taxing authority cannot be construed as a tax ruling. One cannot obtain one without the other.

The letter by Deloitte and Touche, to the respondent's predecessor, falls woefully short of the requirements detailed above. In fact, the enquiry remains just that and not an application for a tax ruling because it does not comply with paragraph(s) (e), (f), (g), (h), (i), (j), (k), (l) and (m) above.

Even if the letter by Deloitte and Touche could have qualified as an advance tax ruling in the absence of the above noted statutory provisions, the issue now is whether the 'tax ruling' is binding on the current respondent.

Section 5(3) of the 4th Schedule to the Revenue Authority Act provides as follows:

“(3) Any written statement issued by the Commissioner-General interpreting or applying the Income Tax Act [Chapter 23:06] prior to the 1st January 2007, or any other relevant Act prior to the 1st January 2009, is to be treated as and have the effect of a non-binding private opinion, unless the Commissioner General prescribes otherwise in writing.”

The alleged tax ruling was made in 1996 and it related to the interpretation of schedules 9 and 15 to the Income Tax Act. The letter written by the Commissioner of Taxes (COT), therefore, is, by operation of law, a non-binding private opinion, as the Commissioner General (COG) of the respondent has not directed otherwise.

A non-binding private opinion is defined in the following words in section 1 of the 4th Schedule to the Revenue Authority Act:

“'non-binding private opinion' means a written statement issued by the Commissioner General in response to an enquiry by a person in order to provide the person with informal guidance in respect of the tax treatment of a particular set of facts and circumstances or transaction, but which does not have a binding effect.”

Further, the Revenue Act, 4th Schedule, makes it clear, in section 5(2), that a non binding private opinion may not be cited in any proceedings before the Commissioner-General (COG) or the courts “other than a proceeding involving the person to whom a non-binding private opinion was issued.”

The Deloitte and Touche inquiry was not made in a representative capacity, and, hence, only the accounting firm may rely on it and not the appellant.

Where a ruling is intended to benefit a certain class of persons, in terms of section 2(3) of the 4th Schedule to the Revenue Authority Act, a description of the class members concerned must be made by the applicant.

None was made in this case.

The appellant's attention was fully drawn to the above self-evident statutory provisions, and, its insistence on its position on the point can only be regarded as having been frivolous, which frivolity, extending as it does to the rest of the appellant's submissions, inevitably has to be visited by an appropriate order of costs.

The respondent has taken the position that a scrip dividend is not the same as bonus shares, and, for that reason, is not exempt from tax in terms of the 9th and 15th Schedules to the Income Tax Act [Chapter 23:06].

In terms of sections 26 and 28 of the Income Tax Act, shareholders are liable to pay tax on their dividends. The company distributing such dividends is, at law, required to withhold such tax when it distributes the dividends and remit the same to the respondent. See sections 2(1) of both the 9th and 15th Schedules to the Income tax Act.

Dividends, for the purposes of shareholders' taxes, are defined in terms of the 9th and 15th Schedules to the Income Tax Act as follows:

“'dividend' means any amount which is distributed by a company to its shareholders…,.”

The most important principle, in relation to this, emanates from the reading of the section itself.

The wording of the letter from Messrs Deloitte and Touche, to the Commissioner of Taxes, becomes relevant. It speaks to the state of the transaction involved. It says in part “…, where a company, in declaring a dividend, allows…,.”

The very act of declaring a dividend is distribution of an amount to the shareholders.

At this stage, before any further considerations are made, the amount so declared is a dividend and subject to the withholding tax.

The fact that the shareholders are then allowed an election, after the declaration of the dividend, matters not. By then, taxes would already have accrued by operation of law.

The act of declaring a dividend is not linked to the choice the shareholders are given in whether to accept cash or take a scrip dividend. The former precedes the latter. At the point the former is declared, tax is chargeable. Therefore, as at the time a dividend is declared, the appellant is obliged to withhold tax for onward transmission to the respondent. What happens to the dividend after that stage matters not for purposes of taxation.

This position is buttressed by section 1(2) under both the 9th and 15th Schedules to the Income Tax Act. The sections are similar and they provide for the following:

“A dividend shall be deemed to be distributed when it is paid to the shareholder, credited to his account or so dealt with that he becomes entitled to it, whichever occurs first.”

The question whether the appellant capitalized its profits can only be determined by having due regard to the circumstances surrounding the transaction. This position was succinctly put forward by BENJAMIN J in Wilson v Commissioner for Inland Revenue 1926 CPD 63 70 in the following words:

“From a consideration of the judgment in that case, it appears the test to be applied is what was the intention of the company dealing with the matter; did the company intend that the sum dealt with should become income or capital. Thus, INNES CJ, in discussing the case of Bouch v Sproule (12 AC 385) said (at p.357):-

'It was a dispute as to whether the tenant for life or the remainder man was entitled to a bonus dividend applied in part payment of certain bonus shares. That depended upon whether the bonus was income passing to the tenant for life under the will or was an accretion of capital enuring to the ultimate benefit of the remainder man. So that the point which lies at the root of the present appeal fell to be decided: The facts were that the directors distributed certain accumulated profits (which had been temporarily capitalized) as a bonus dividend and allocated the new shares (partly paid up) to each shareholder, applying the bonus dividend in part payment of the new shares. Under these circumstances, it was held…, that the company did not pay or intend to pay any sum as dividend, but intended to do, and did, appreciate the undivided profits as an increase of the capital stock; the bonus dividend was therefore capital of the estate and the life tenant was not entitled to it or the shares.'

Again, in discussing the case of the Commissioner for Inland Revenue v Blott (35 T.L.R 687, 36 T.L.R. 575, 125 L.T 4970 he said (at p.358):

'The principle of Bouch v Sproule was applied – namely, that where the company has the power of capitalizing or distributing profits and decided to capitalize them, then the nature issued in respect of such profits was determined by the company's intention; and it was held that the procedure followed did not alter the real nature of the transaction.'

Again, a little lower down in the judgment he said (at p.361):

'The company ought, in the words of LORD HALDANE, to be 'dominant on the question whether the money in question was to be income or capital for all purposes.'”

It immediately becomes clear that for the shares to be considered bonus shares, it must have been a capitalisation of the undistributed profits at the instance of the company.

Once a dividend is paid out and the shareholder is given the option to use such cash dividend to buy more shares, such shares so bought are not bonus shares. This is no more than the shareholder electing to use his dividend to purchase more equity in a company.

The letter by Deloitte and Touche is clear in its tenor.

The choice is given to the shareholder whether to take the dividend in cash or in shares. There is nothing which stops the company from distributing the dividends in cash. In the same vein, there is nothing which would stop a shareholder from accepting some of the dividend in cash and the other part in shares. The intention of the company is paramount here - it was to distribute dividends to its members. It then gave the members a choice of accepting either cash or shares. The scrip dividend in this case does not cease to be a dividend. It is a dividend dealt in a particular way by the shareholder and not the company and it does not lose its status as a dividend. The scrip dividend, in these circumstances, is a dividend and not 'bonus shares.'

The submission by the appellant that “the company's accumulated profits have, as a matter of accounting practice, therefore been capitalised and thus the shareholder has received nothing out of the assets of the company for his separate use and benefit” cannot be correct.

The election to receive shares in lieu of a cash dividend in itself is a purchase of shares.

The choice given to the shareholder is that which shows that the profits have been distributed and the shareholder has elected to use his dues to buy more equity. Since a shareholder who accepts the dividend in cash is liable to pay tax, the fact that another has elected to deal with their dividend in a different manner does not make the dividend so received and utilised any less a dividend. The election to receive shares is a purchase of shares and the shareholder would have received something out of the assets of the company for his separate use and benefit. By distributing the dividend in the first place, the amount representing that dividend would have ceased to be part of the company's assets. The mere declaration of a dividend payable in one manner or the other means that such dividend ceases to be part of the company's assets and can be used by the shareholder in any manner he or she pleases.

On this premise, the contents of the letter by the Commissioner of Taxes (COT) to Deloitte and Touche do not capture the correct position of the law.

Equally untenable is the argument that a scrip dividend is not a dividend in that it is not an “amount distributed by a company to its shareholder.”

The fact of the matter is that the election only arises after the dividend is declared, the default position is that the dividend will be paid out in cash, an amount. When the shareholder elects to have shares instead, the shareholder would have disposed of his cash dividend and bought shares with it. The cash dividend which finances the purchase of shares is an 'amount.' The scrip dividend in that regard is also an amount.

It is not in doubt that after the appellant declared dividends, it invited its shareholders to decide whether to accept cash for the dividends or accept shares in lieu of cash. The acceptance of shares in lieu of cash simply means that the shareholders would have used their dividends to buy more shares in the appellant. The acceptance of shares in lieu of cash is no more than an instruction by the shareholder that his dividend ought to be used to purchase shares. This is totally independent from the declaration of the dividend. The declaration of the dividend is the act of the company and the acceptance of a scrip dividend is the act of a shareholder after the dividend has been declared.

Now, 'bonus shares' are shares which are given out by the company to its shareholders on a pro-rated basis and they are paid for from the company's undistributed reserve profits.

The intentions of the appellant are clear from the letter.

There was no scheme of the capitalisation of capital going on. The shareholders were given an election which they duly exercised. This is distinctly different from capitalization of undistributed profits.

The moment a company declares a dividend, and issues it out, the profits are distributed in the form of cash. The question of bonus shares does not arise as the company, by declaring a cash dividend, would have distributed the profits to its member. The question of bonus shares, which come about where a company does not distribute profits in cash and gives the members more shares in line with their shareholding in the company, does not arise in this case because the profits were distributed to the shareholder in cash as dividends.

'Bonus shares' are fully paid up using the company's reserve un-distributed profits.

The declaration of a dividend is, in its own, a distribution of profit. As such, the question of bonus shares cannot arise where such shares are paid for by proceeds from a dividend. In other words, a scrip dividend is not the same as a bonus share.

The Commissioner of Taxes was clearly wrong in saying that, in a script dividend situation, there is no distribution of profits and no property is passed from the company to the shareholders.

In a scrip dividend scenario, it is the individual shareholder who invests his dividend by purchasing more shares. In a bonus share arrangement, it is the company which pays for shares from the undistributed reserve profits and distribute the same to the members on a pro-rated basis. Both of these schemes result in shares for the members of a company but a scrip dividend is shareholder-driven and a 'bonus share' scheme is company-driven. As such, the principle relating to the two ought not to be conflated.

Perhaps the most important point to note is that where a dividend is declared, the shareholder becomes entitled to it and it attracts tax as at that point and the choice to take a scrip dividend can only be made after such tax is due by operation of law.

Now, regarding the retrospective effect of the Commissioner-General's (COG) measures, the revenue authority is not entitled, at law, to give anyone unlawful tax breaks and prejudice the fiscus.

Where the revenue authority has made an error, it is allowed to rectify it - even retrospectively.

The appellant relies on Commissioner of Taxes v Astra Holdings (Pvt) Ltd 2003 (1) ZLR 417 (S) for the proposition that the taxing authority is required, at law, to act fairly towards both the taxpayer and the fiscus.

In this light, the allegation is that the appellant has acted on the strength of the Commissioner of Taxes (COT) ruling and requiring it to pay withholding tax going three years back would be unfair.

However, as a matter of law, the respondent is not precluded from assessing a tax legally due only because the taxpayer has relied upon the respondent's predecessor's prior mistaken view of the law. In Dixon v United States 381 US 68 (1965), it was said, in part:

“Commissioner is empowered, retroactively, to correct the mistakes of law in the application of the tax laws to particular transactions. He may do so even where a taxpayer may have relied, to his detriment, on the Commissioner's mistake…,. This principle is no more than a reflection of the fact that Congress, not the Commissioner, prescribes tax law.”

The argument by the appellant, that the decision to have it pay withholding tax for the three prior years is unlawful, is untenable.

The point here is that the appellant cannot require the respondent to continue acting unlawfully in order that its actions be fair.

The main duty on the respondent is to act lawfully, and, in demanding the withholding tax, it acted lawfully. There is no question of the respondent acting unfairly when it acts in accordance with the law; in other words, lawfully. Implicit in lawfulness is fairness.

A similar principle can be derived from Tregers Industries (Private) Limited v Commissioner General of the Zimbabwe Revenue Authority 2006 (2) ZLR 62 (H) wherein GARWE JP…, said:

“The applicant argued that the respondent is 'estopped' by the actions of his subordinates from denying that the applicant's interpretation of section of the Act is correct.

I do not accept this submission.

What the applicant is saying is that irrespective of the correct interpretation, the fact that the respondent's employees accepted that the goods in question were zero rated estops the respondent from arguing to the contrary.

As a matter of law, that cannot be correct.

If an interpretation of the law is not correct, then that interpretation is not correct. The fact that respondent's employees may not have looked into the matter more carefully cannot estop the respondent from arguing that such interpretation is not correct.”

The respondent cannot be estopped from acting lawfully.

What is apparent is that the appellant cannot seek to enforce an unlawful position on the basis that it would be unfair on it should the respondent revert to acting lawfully.

Sight should not be lost of the fact that tax law is strict liability law.

The fact that the respondent's predecessor made a mistake upon which it relied does not save the appellant. It would be still required to remit all taxes as is required at law.

It is for these reasons that I dismissed the appeal with costs.

HB119-11 : LEAHOLM ENTERPRISES (PVT) LTD vs ZIMBABWE REVENUE AUTHORITY
Ruled By: NDOU J

The applicant seems to be relying on such earlier clearance to imply that it legitimately expects the current consignment to be cleared.No legitimate expectation could arise from an ultra vires or erroneous relaxation of the relevant statute by the body responsible for enforcing it. The facts reveal unfairness to the ...

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 of 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.

SC73-17 : TENDAYI TAMANIKWA and FRANK TINARWO vs ZIMBABWE MANPOWER DEVELOPMENT FUND and EMMERSON PAMIRE
Ruled By: GWAUNZA JA, BHUNU JA and UCHENA JA

This is an appeal coupled with a cross-appeal against the judgment of the Labour Court.

Both appellants, in the main appeal, and the respondent in the cross appeal, Emmerson Pamire, were employed by the respondent. Following leakages of confidential information at the work place, the respondent ordered them to sign declaration of secrecy forms. They wilfully disobeyed that order and were suspended from employment pending disciplinary action.

As managerial employees, the first and second appellants had been issued with motor vehicles by their employer. Upon suspension, they were ordered to return the motor vehicles. They both wilfully refused to return the motor vehicles as ordered by the employer.

All the three (3) employees were eventually charged with wilful disobedience to lawful orders before the Disciplinary Authority. They were all found guilty as charged and dismissed from employment on 28 November 2013.

Disgruntled by their dismissal from employment, they approached the Labour Officer, who, in turn, referred the dispute for arbitration in terms of section 93 of the Labour Act [Chapter 28:01].

The terms of reference before the arbitrator, branded, “CLAIMANTS' ISSUES FOR DETERMINATION” were as follows:

“Whether or not the dismissal of the three claimants was fair and lawful?

1. Whether or not the employer was entitled, at law, to institute fresh disciplinary proceedings without complying with the Supreme Court order of 16 July 2013 ordering them to reinstate the claimants without loss of salary and benefits?

2. Whether or not it was lawful for the employer to charge first and third claimants with wilful disobedience of lawful orders arising out of their failure to handover vehicles when the matter of ownership and possession of the vehicles was sub judice (the subject of a legal dispute) which is still pending in the High court in case numbers HC6419/2010, HC6420/10, HC4233/10 and HC4258/2010 which cases were all consolidated under case number HC4258/2010 for purposes of trial?

3. Whether the labour dispute leading to the disciplinary proceedings instituted by the respondent against claimants on 17 July 2013 had prescribed in terms of section 94 of the Labour Act Chapter 28:01 and whether the respondent had a right to charge the claimants for misconduct over the events that allegedly occurred on August 2009?”

The arbitrator, on the basis of the terms of reference placed before her, found that the employer's orders were lawful as they were meant to advance the employer's business. She accordingly upheld the claimants' conviction. She, however, overturned the penalty of dismissal and substituted it with a lesser penalty of final written warning.

The award reads:

“AWARD

1. The Respondent, Zimbabwe Manpower Development Fund (ZIMDEF), be and is hereby ordered to substitute the dismissal penalty with a final written warning valid for twelve (12) months.

2. Respondent be and is hereby ordered to reinstate the claimants without loss of pay and benefits from the date of dismissal.

3. If reinstatement is no longer tenable parties may negotiate for damages in lieu of reinstatement failure of which either party my approach the arbitrating authority for quantification.”

Dissatisfied with the above order reinstating the three (3) respondents, the employer appealed to the Labour Court. The respondents did not, however, cross-appeal against the arbitrator's award upholding the Disciplinary Authority's verdict convicting them of dismissible acts of misconduct as charged.

The second respondent, in the court a quo, Emmerson Pamire, was, however, partially successful in that Court. The court a quo set aside the arbitrator's award and upheld the decision of the Disciplinary Authority dismissing the first and third respondents from employment as prayed for by the employer.

The appeal against the reinstatement of the second respondent, in the court a quo, was, however, unsuccessful in that the court a quo upheld the arbitrator's order of reinstatement. The court a quo's order reads:

“WHEREFORE IT IS ORDERED THAT:

1. The appeal be and is hereby allowed.

2. The arbitration award issued by arbitrator C K Kadenga dated 8 December 2015 is set aside.

3. The dismissal from employment of 1st and 3rd respondents (Tendayi Tamanikwa and Frank Tinarwo) by appellant is upheld.

4(a) The appellant shall reinstate the 2nd respondent Emmerson (Emmerson Pamire) without loss of salary and benefits; or

(b) If reinstatement is no longer tenable, appellant shall pay 2nd respondent damages in such (sic) either agreed by the parties or assessed by this court.”

Unhappy with the Court a quo's judgment, ordering their dismissal from employment, the first and second appellants, in the main appeal, Tendayi Tamanikwa and Frank Tinarwo, appealed against part of the court a quo's judgment upholding their dismissal from employment. Having appealed only against part of the judgment, they erroneously went on to pray for the setting aside of the whole judgment.

The Notice of Appeal reads:

“TAKE NOTICE that the Appellants hereby appeal against part of the judgment of the Labour Court…,.”…,.

Whereas the relief sought reads as follows:

“RELIEF SOUGHT;

The appellants seek the following relief:

1. That the appeal is allowed with costs.

2. That the judgment of the court a quo is set aside and in its place substituted by the following:

2.1 The dismissal from employment of the 1st and 2nd appellants be and is hereby set aside.

2.2 The Respondent shall reinstate the 1st and 2nd Appellants without loss of salary and benefits with effect from their date of dismissal.

2.3 If reinstatement is no longer suitable, the Respondent shall pay damages to 1st and 2nd Appellants without loss of salary and benefits in an amount to be agreed or assessed by the Labour Court.”…,.

It is plain that the Notice of Appeal and the relief sought by the appellants are irreconcilably contradictory. It is rather irrational for the appellants to appeal against only part of the judgment and then seek to have the whole judgment set aside.

The learned Chief Justice, in his routine supervisory and administrative functions, noted the fatal irregularity and engaged counsel for the appellants with a view to enlighten him about the fatal defect in his Notice of Appeal.

His extra curial intervention was made in good faith to avoid clogging the court with fatally defective appeals. As the Chief Justice was not presiding over a court but merely performing his administrative function there was nothing he could do to prevent counsel from taking his patently defective Notice of Appeal to court.

Disputing the fatality of the defects in his Notice of Appeal, counsel for the appellants steadfastly stuck to his guns and refused to take the learned Chief Justice's wise counsel. It however dawned on counsel, later on, that his Notice of Appeal was defective.

He then filed an application to amend the defective Notice of Appeal on 6 September 2017.

In his application to amend the Notice to Appeal, counsel for the appellants acknowledged that the Notice was defective for want of compliance with Rule 7(b) of the Supreme Court (Miscellaneous Appeals and References) Rules 1975 in two material respects, namely:

1. The mis-naming of the parties in the prayer as described at sub paragraph 2.2; and

2. The non-statement in paragraph 2 of the prayer that only part of the judgment of the court a quo should be set aside.

While accepting that his Notice of Appeal was defective, counsel for the appellants sought to persuade the court that the above defects in his Notice of Appeal were not fatal as they are capable of being amended.

Rule 7 is however couched in peremptory terms admitting no exception. It reads:

“7. Contents of Notice of Appeal

A notice instituting an appeal shall state —

(a) The tribunal or officer whose decision is appealed against; and

(b) The date on which the decision was given; and

(c) The grounds of appeal; and

(d) The exact nature of the relief sought; and

(e) The address of the appellant or his legal representative.”…,.

It is settled law that, save in exceptional circumstances, the term 'shall', denotes the law maker's intention to render the Rule mandatory.

This Court has ruled, on numerous occasions, that failure to comply with mandatory provisions of the Rules of court will render an appeal a nullity.

In Chikura and Another v Al Sham's Global BVI Limited SC17-17 ZIYAMBI JA had occasion to remark that:

“The Rules are made for the proper running of the Court. Failure to comply with its mandatory provisions will render an appeal a nullity. See Matanhire v BP & Shell Marketing Services (Pvt) Ltd 2004 (2) ZLR 147 (S).”

In Freezewell Refrigeration Services (Private) Limited v Bard Real Estate (Private) Limited SC61-03, this Court held that a fatally defective appeal cannot be condoned or amended. It can only be struck off.

The Notice of Appeal, in this case, is, therefore, fatally defective and a nullity at law. For that reason it is incurably bad and beyond repair.

The authorities are clear, and it is now a matter of settled elementary law, that, when a proceeding is a nullity every proceeding based on it is also a nullity as observed by KORSAH JA in Ngani v Mbanje & Another; Mbanje & Another v Ngani 1987 (2) ZLR 111…, where the learned judge, relying on the dicta in McFoy v United Africa Company Ltd ALL ER 1169 remarked that:

“If an act is, in law, a nullity, it is not only bad, but incurably bad. There is no need for the order of the Court to set it aside. It is automatically null and void without more ado. Though it is sometimes more convenient to do so. And every proceeding founded on it is also bad and incurably bad. You cannot put something on nothing and expect it to stay there. It will collapse.”…,.

What this means, in simple terms, is that the application to amend the fatally defective appeal is also in itself fatally defective and a nullity at law.

For the foregoing reasons, this Court unanimously holds that both the Notice of Appeal and the application to amend are fatally defective warranting being struck off without any further ado.

Counsel for the respondents, in the main appeal, has asked for costs on the higher scale. Counsel for the applicants sought to resist costs at the punitive scale arguing that the Chief Justice was not sitting as a court and therefore he was at liberty to disregard his caution.

It is correct that the Chief Justice was not sitting as a court but his views mattered. The administrative function to scrutinise court records and engage lawyers before going to court is a noble objective meant to save time and money by nipping defects in the bud before they get to court.

While counsel for the applicants was not bound by the learned Chief Justice's opinion it was wise to take heed of his caution unless he was sure of what he was doing. Had he taken heed, he would not have taken a dead case to court wasting everyone's time and putting the other party to unnecessary expense.

Those who deliberately defy wise counsel and go on to negligently cause others patrimonial loss must not cry foul when they are made to make good the loss.

Costs at the punitive scale are therefore warranted.

It would, in the court's view, be unjust for counsel for the appellants clients to bear the burden of making good the loss when it is his questionable conduct that caused it.

Legal practitioners must be warned that this is the sort of conduct that may attract costs de bonis propriis. By negating sound advice and incurring unnecessary costs in the process, counsel for the appellants was doing his clients a disservice. For that reason, the court considered that it would be patently unjust and unfair to allow him to benefit from his indecorous conduct.

It is for the foregoing reasons that the court proceeded to issue the following order:

“Whereupon, after reading papers filed of record,

IT IS ORDERED THAT:-

1. The application to amend the Notice of Appeal is dismissed with costs on the higher scale.

2. The Applicant's Counsel, Mr. G Machingambi, is barred from charging fees to his clients for the application to amend the defective Notice of Appeal.

3. The cross-appeal is to be heard.”

HB04-09 : ECKEM WILIAM SITHOLE vs PG INDUSTRIES ZIMBABWE (LIMITED) T/A THE AFRICAN LUMBER COMPANY P/L
Ruled By: NDOU J

It is trite that legitimate or reasonable expectation may arise either from an express promise given on behalf of a public authority or from the existence of a regular practice which the claimant can reasonably expect to continue.

HH173-17 : F. MUTATA and OTHERS vs THE MINISTER OF LOCAL GOVERNMENT, PUBLIC WORKS AND URBAN DEVELOPMENT
Ruled By: CHITAKUNYE J and NDEWERE J

This is an appeal against the judgment of the magistrate sitting at Harare in which he granted an order for the eviction of the appellants from certain premises owned by the Government.

The appellants are retrenched or retired civil servants who occupied houses situate in the Messengers' Camp in Highfields, Harare.

The respondent is the Minister responsible for the Ministry that leased houses in question to the appellants.

During the early years of the appellants' occupation of the houses, the respondent caused them to sign lease agreements. As time progressed, the appellants continued occupying the houses without signed lease agreements. They were now statutory tenants.

As the appellants were no longer civil servants, the respondent later wrote letters demanding that the appellants vacate the houses they were occupying. The appellants resisted the eviction and did not comply with notices of eviction that were subsequently issued out by the respondent.

In 2006, the respondent issued summons for the eviction of each of the appellants and whoever was claiming occupation of the houses through them.

The appellants' plea was to the effect that they had been promised that the houses would be sold to them and that they were thus willing to purchase the houses. In the alternative, the defendants contended that they had been promised alternative suitable accommodation in the event of being evicted from their current houses. They thus demanded to either be sold the houses or to be provided with alternative suitable accommodation.

The appellants' defence, in the court a quo, was basically that they had a legitimate expectation that the houses will be sold to them as sitting tenants or suitable alternative accommodation will be provided by the Government in terms of what they said was Government policy.

The respondent disputed that hence the matter was referred to trial.

At the time of trial, in 2007, the appellants had lived in the houses for periods ranging from 10 to 19 years.

The issues for determination were basically on the respondent's right to evict the appellants and whether the appellants had any legitimate expectation that the houses will be sold to them, or, alternatively, that they should be provided with other suitable accommodation.

The trial magistrate ruled that the defence of legitimate expectation could not avail the appellants as such a defence only applied to procedural rights such as the right to be heard and not on substantive rights such as that the respondent be ordered to sell the houses to the appellants or to provide them with suitable alternative accommodation.

The magistrate's decision was premised on the fact that the appellants had been insisting that the respondent should sell the houses to them or provide them with alternative accommodation to buy failure of which they would not vacate the houses.

In as far as the trial magistrate understood the appellants to be resisting eviction on substantive rights and not procedural rights, he cannot be faulted. Besides the pleadings that have already been referred to, the appellants' witness, Nyasha Masawi, confirmed as much.

Under cross examination, the witness confirmed that upon receiving letters to vacate they went and saw the Minister seeking to be provided alternative accommodation. Upon the Minister's verbal promise to organise alternative accommodation for them, they left. He concluded by saying that: “we expect to be given Stands to move to.”

In his closing submissions, in the court a quo, the appellants' counsel reiterated the appellants' stance that the legitimate expectation the appellants were expecting was for these houses or alternative accommodation to be sold to the appellants. He thus asked court to order the disposal of the houses to the appellants.

In written submissions made at the court a quo's request, counsel repeated the same when he said that: “the delay in evicting the defendants, after the expiry of the leases and the promises of disposal, cemented defendants' legitimate expectation of disposal of the houses to them as sitting tenants.”

Counsel further argued that: “it is the duty of the Ministry of local government, public works and national housing to house the citizens of Zimbabwe rather than evict them like what they want to do in this case. If they are not prepared to dispose of these houses to the defendants it is only just and equitable to have plaintiff hear the side of defendants story in a hearing and map the way forward rather than evict them. They should then afford the defendants the procedural right of legitimate expectation that is available in our law.”…,.

It was clear that the rights the appellants were craving for pertained to substantive and not to procedural rights. They wanted to be sold the houses. The trial magistrate, having found that the defence of legitimate expectation is available only in instances of procedural rights, concluded that since the appellants were seeking substantive rights, their defence was untenable.

The appellants' grounds of appeal were couched as follows:

1. The learned magistrate, in the court a quo, erred by holding that courts cannot interfere in policy matters holding that they are solely for the Government, failing to take into account the basic and rational for Administrative Law is to exert legal control over the way in which administrative authorities exercise their functions in order to ensure that these authorities do not exceed or abuse their powers. The law promotes effective use of administrative power at the same time providing protection against misuse of power.

2. The learned magistrate in the court a quo erred by holding that long stay in Government house does not impute ownership failing to take into account the circumstances that led to the long stay. Due consideration was not given to the undisputed fact that the long stay was caused by the respondent's assurances. The appellants have been staying in the houses for a period ranging between 10 - 20 years, was a result of Ministerial and political promises that they were in the process of disposing the houses to the appellants.

3. The learned magistrate in the court a quo erred by overlooking the extent to which the respondent had gone in promising the appellants that they were going to buy the houses they were occupying. The respondents had, up to present day, registered the appellants' names with City of Harare for the payment of rates, water and electricity bills. According to the appellants, such actions legitimatized their expectations that the houses were going to be sold to them.

4. The learned magistrate in the court a quo erred, clearly misdirected himself, thus his analysis of the matter can successfully be challenged.

Before determining whether the magistrate in the court a quo erred or not, it is pertinent to appreciate the doctrine of legitimate expectation.

In Metsola v Chairman, Public Service Commission & Another 1989 (3) ZLR 147 (SC) …, GUBBAY JA…, had this to say on legitimate expectation:

“Mr. Gillespie laid much emphasis on the legitimate expectation test introduced by LORD DENNING MR in Schmidt & Anor v Secretary of State for Home Affairs [1969] 1 ALL ER 904 (CA) at 909C and upheld by the Privy Council in Attorney General of Hong Kong v N g Yen Shiu [1983] 2 ALL ER 346 (PC) at 350 a-j.

Yet, this catch-phrase is no more than a manifestation of the duty to act fairly. It is clearly connected with the 'right to be heard'. It does not constitute an additional ground for the application of the audi alteram partem principle. In essence, it means no more than that the decision-maker must act fairly and apply the principles of natural justice before reaching any decision that will adversely affect the legitimate expectations of the aggrieved party.”

In Matake & 17 Others v Ministry of Local Government and National Housing & 2 Others 2007 (2) ZLR 96, the basic requirements of this defence were summarised as including the following:

1. The expectation underlying the expectation must be clear, unambiguous, and devoid of relevant qualification.

2. The expectation must be reasonable.

3. The representation must have been induced by the decision-maker.

4. The representation must be one which it was competent and lawful for the decision maker to make, without which reliance cannot be legitimate.

The doctrine of legitimate expectation is really a call for fairness and for the right to be heard before a decision adverse to the expectation of an affected party is made.

In applying the above exposition to the case at hand, it is apparent that, in raising legitimate expectation, the appellants were not seeking a procedural right to be heard but that the houses be sold to them as per their expectation. The pleadings and evidence in court confirm as much. It is in that light that the trial magistrate alluded to the fact that legitimate expectation is for procedural and not substantive rights.

In his heads of arguments, counsel for the appellants made the following concessions:

1. That the appellants cannot argue that the respondent be ordered by this court to sell the houses to them, and seek to defend their eviction on that basis.

2. That the respondent never sold the houses in question to the appellants.

3. That the respondent did not offer the houses to the appellants for sale with the result that all the appellants had to do was to accept such offer for contracts of sale to be concluded.

The above concessions show a change in stance by the appellants.

It is this change that counsel now introduced as the basis for the appeal. In paragraph 8 of the heads of argument counsel stated that:

“The argument is not that respondent must either have sold the houses to appellants, or provided them with alternative accommodation before instituting eviction proceedings. Instead, the contention is this: that having raised their legitimate expectations to purchase the houses, and, alternatively, to provide them with alternative accommodation in the form of Stands to purchase, respondent is bound by the principle of legitimate expectation to hear the appellants before instituting eviction proceedings against them.”

This argument is not in tandem with what transpired in the court a quo.

In the court a quo, the appellants defence was not on the procedural right to be heard before summons were issued, but to have the respondent ordered to sell the houses or to provide them alternative accommodation.

As already alluded to above, the defence of legitimate expectations applies to procedural right, such as the right to be heard, before an adverse decision is made against a party. It is not available in a situation such as this where the appellants were in fact contending that the court should order the respondent to sell the houses to them.

Counsel, having appreciated the limits of the defence of legitimate expectation, correctly made the above concessions.

In respect of the right to be heard, it was clear that the policy that the appellants were relying on was a general policy that the Government had adopted.

The net effect of the concession is that the question to be ascertained is whether there was a change in the alleged Government policy; if so, were the appellants entitled to be heard before being asked to vacate the houses.

As already alluded to, the policy to sell to sitting tenants was a general policy. That general policy was addressed to the respondent's Provincial Administrators. Part of the letter, dated 18 December 2000, addressed to the Provincial Administrators, on the subject, read as follows:

“RE: DISPOSAL OF POOL AND RESERVED HOUSES STILL ON RENTAL

This Ministry is, in terms of the Millenium Economic Recovery Programme, required to, among other things:

(a) Review rentals for houses to market levels; and

(b) Dispose of some of the pool and reserved houses.

You are required to consult with the other heads of Government Ministries in your respective provinces to determine the number of pool and reserved houses to be disposed of without disrupting Government operations. The age of the houses should be used as one of the criteria of selecting the houses to be disposed of.

You are also required to give preference to houses in Messengers' Camps situated in urban centres as these were left out in the 1994 disposal.”

The above was a request for assessment of houses to be disposed of. It was not an offer to sell all the houses to sitting tenants.

Even after the appellants had expressed desire to buy the houses, they were not personally offered the houses for sale.

The general policy was changed before the appellants had been offered the houses.

When the general policy was changed, the appellants were made aware of this by letters addressed to them and advising them to vacate. It is these letters that prompted them to seek audience with the Minister of Local Government. The appellants confirmed holding such a meeting in which it was made clear to them that the houses would not be sold to them as Government policy had changed. It was then that they asked for alternative accommodation and the Minister made a verbal promise to organise alternative accommodation.

Clearly, as at that stage, they had been given a hearing and had accepted that the policy had changed and they were no longer going to be offered the houses for sale.

What they remained with, at the most, was the verbal promise by the Minister to organize alternative accommodation for them. The general policy had not provided for alternative accommodation.

The issue of the change of general policy by Government is something that the court cannot easily interfere with. It is in this light that the courts have said that questions of economic and social policy are matters within the domain of the executive discretion and the courts should exercise great restrain in delving into the details of policy instruments of directing the precise manner of their implementation unless the court is convinced that the assessment in question is manifestly without merit. See Minister of Lands and Others v Commercial Farmers Union 2001 (2) ZLR 457…,.

The same could be said regarding changes to general policies by Government.

What the court will require is that those affected by changes in general policy be afforded a hearing before such is implemented.

In casu, the appellants, upon receiving letters indicating a change of the general policy, approached the responsible Minister and other officers within the Ministry. They were afforded a hearing.

The suggestion that they should have been heard before the general policy was changed would not be realistic. This having been a general policy, to expect the Ministry to have invited each and every person to be affected to input before the change would be unrealistic. What was crucial, in my view. is that the change was communicated and those affected were given audience.

In casu, the court a quo alluded to the change in policy that had occurred such that whilst at one time the appellants were made to expect that the houses will be sold to them, such a policy was changed before the houses had been offered to the appellants.

The appellants' right in the circumstances was to be afforded a hearing before they were evicted. They were indeed heard. It was only after the meetings with the Ministers and other Ministry officials in the period 2002 to 2005 that summons for their eviction were issued out in 2006.

In the circumstances of this case I am of the view that the decision by the court a quo cannot be faulted given the appellants' defence before that court. Even on the procedural right to be heard it cannot be said the appellants were not heard before summons for eviction were issued. The appeal cannot thus succeed.

Accordingly, it is hereby ordered that the appeal be and is hereby dismissed with costs.

HH177-17 : GILBERT JONGA vs NYASHA CHABATA
Ruled By: CHATUKUTA J

The applicant seeks an interdict restraining the respondent from interfering with his farming operations at Subdivision 3 of Farm 45, Glendale (the farm).

This is not the first time that the parties are before this court. The parties are fighting over who has the right to occupy the farm which belongs to the State. On 6 December 2016, the respondent successfully approached this court in case number HC12380/16, on an urgent basis, seeking spoliatory relief. On 9 December 2016, MATANDA-MOYO J ruled in favour of the respondent in case number HC12380/16 and issued the following order:

“TERMS OF FINAL ORDER SOUGHT

That you show cause to this Honourable Court why a final order should not be made on the following terms:

1. The interim order be confirmed.

2. It be and is hereby declared that applicant, his representatives, employees and invitees are entitled to remain in peaceful and undisturbed possession, occupation and use of subdivision 3 of Farm 45 of Glendale in Mazowe District of Mashonaland Central measuring 36.21 hectares.

3. The respondent pays the costs of this (application) on the higher scale of legal practitioner and client.

TERMS OF THE INTERIM ORDER GRANTED

Pending the finalisation of this matter, the applicant is granted the following interim relief –

1. That the respondent restore to the applicant possession of subdivision 3 of Farm 45 Glendale in Mazowe District of Mashonaland Central measuring 36.21 hectares.

2. The Deputy Sheriff be and is hereby authorised and empowered to ensure that such restoration is done and that the applicant remain in peaceful and (undisturbed) occupation of the above property.

3. The respondent and all those claiming through him vacate the said property forthwith of which the Deputy Sheriff is authorised to evict same from the property.

4. That the respondent pays costs of suit.”

On 13 December 2016 the applicant noted an appeal against the judgment of MATANDA-MOYO J.

On 22 December 2016, the respondent destroyed part of the applicant's crop resulting in the present application.

The background to this application was articulated in case number HC12380/16 in which the court found that the respondent is a holder of an offer letter for a portion of the farm measuring 36.21 hectares. The offer letter was issued on 6 November 2015. The applicant produced documents proving that he was in occupation of the Remaining Extent of Farm 45 (Truro) Glendale and Plots 1, 4, and 5 of Dunmaglas Farm in Mazoe. The court found that the portions allocated to the two parties are different.

The applicant contended, in HC12380/16, and still contends in the present application, that the portions are one and the same and he has a 99 year lease over the entire farm. He has been in occupation of the entire portions since 2002 - well before the respondent was issued with the offer letter on 6 November 2015.

Believing that the court in case number HC12380/16 erred in holding that the portions are different and that he was not in possession of the farm, the applicant filed an appeal against that decision in SC771/16.

The applicant avers, in the present case, that, at the beginning of 3 October 2016, he entered into an agreement to grow 100 hectares of maize with the Government under the Special Programme on Maize Production for Import Substitution (popularly known as “the Command Programme”). He was given inputs under the Programme, and, during the first half of November 2016, and before the respondent had filed her application in case number HC12380/16, he planted his maize. On 13 December 2016 he filed the appeal against the decision. On 21 December 2016, the respondent returned to the farm and destroyed 7 hectares of the maize crop. Fearing that the respondent could proceed to destroy further hectarage, the applicant has approached this court on a certificate of urgency for an interdict....,.

The issue before me is not who has the right to occupy the farm. The issue is how to protect the maize crop on the farm, which had been partly destroyed by the respondent, pending the determination of the appeal....,.

I now turn to the merits of the application, the requirements of an interdict are trite, that:-

(a) There is a prima facie right even though open to doubt;

(b) An injury has actually occurred or is reasonably apprehended;

(c) The applicant does not have an alternative remedy; and

(d) The balance of convenience favours the granting of the interim relief.

See Setlogelo v Setlogelo 1914 AD 221; Airfield Investments (Pvt) Ltd v Minister of Lands & Ors 2004 (1) ZLR 511.

It is not in issue that the applicant had a prima facie right, albeit, one which is open to doubt.

The applicant produced a letter, dated 27 October 2015, from the Ministry of Lands, confirming that his application for a 99 year lease over Reveille Farm & Farm 45 had been approved. The respondent conceded that whilst the applicant had not established a clear right to be on the farm, he had established a prima facie right. She conceded that, in November 2015, the applicant had planted only 3ha of maize crop on the farm. This confirms that the applicant was already in occupation of part of the farm as her offer letter is dated 6 November 2015 and she only moved onto the farm in December of the same year.

Even assuming that it were to be found that the applicant does not have any right to occupy the farm, he would be entitled to tend to and harvest his maize crop as such crop does not attach to the land as a permanent fixture; see Bangure v Gweru City Council 1998 (2) ZLR 396 (H)…,.

It is equally not in issue that an injury has already occurred.

The applicant produced pictures showing areas with a thriving maize crop which had been ploughed under. The respondent conceded to have ploughed the crop under on instruction of the Deputy Sheriff.

Both the applicant and the respondent produced documents from Agritex as to the extent of the damage. The applicant produced an assessment report dated 9 December 2017 of the total area planted as at 22 December 2016 (38.7ha), area ploughed under (4.6ha) growth stage of the maize crop (3 to 5 leaf stage). Although the report is dated 9 December 2016 (before the destruction of the crop) it tallies with the contents of the minutes produced by the applicant dated 11 January 2017. The minutes are of a meeting purportedly held on 23 December 2016 at the behest of the Command Programme Bindura committee following the destruction of the crop by the respondent. The minutes confirm the apprehension of all concerned of the harm that was to be caused if the respondent was to continue to destroy the crop.

This apprehension, in my view, confirms that the applicant does not have an alternative remedy other than to approach the court.

The requirement on the existence of an alternative remedy is well explained in Neptune (Pvt) Ltd v Venture Enterprises (Pvt) Ltd HH127-89. At page 8 ADAMS J quotes LEWIS J in Reserve Bank of Rhodesia v Rhodesia Railways 1966 RLR 451 that -

“…, NATHAN, in his well known works on INTERDICTS, states the position as follows, at p32 -

'Lastly, as Van der Linden says, there must be no other ordinary remedy by which the applicant can be protected with the same result….,. The most familiar example, however, which comes to a lawyer's mind is that of damages. It is clear that, if the applicant will have adequate compensation by the award of damages, he will have another ordinary remedy….,. Generally speaking, however, the fact that the applicant has a remedy open to him by way of action for damages is sufficient to bar an interdict where the interference or breach of a right is capable of measurement in money.'

The operative part of the quotation, in fact, the essence of it, really, is, that there is an existing remedy for the protection of the applicant 'with the same result';…, if that is the situation, then, so it seems to me, the interdict should be refused.”…,.

As alluded to earlier, there is no other remedy that would compel the respondent from interfering with the applicant's farming operations other than an order from this court.

The applicant has therefore satisfied the first three requirements.

Both the applicant and the respondent have invested time and other resources into the maize crop. The applicant is the one who expended time, effort, and resources to obtain the inputs. He is the one who worked on the land, planted the crop, and managed the crop until the respondent took over. The respondent has been managing the crop and has equally invested time and other resources since then.

The issue is therefore where the balance of convenience lies.

The applicant submitted that he is the one who entered into an agreement under the Command Programme and is obliged to manage the maize crop and make deliveries in terms of the agreement. In the event that he fails to do so, he is likely to face a claim for damages as in Rollex (Pvt) Ltd v Delta Beverages (Pvt) Ltd HH66-15.

The respondent relies on the resolution of the meeting on 23 December 2016 which resolution transferred the applicant's rights and obligations under the Command Programme agreement to her.

The applicant is beneficiary of the inputs under the Command Programme that are presently in the ground. He is the one who legally has rights and obligations under that programme. The agreement is still binding. The applicant, pursuant to the agreement under the Command Programme is, and must, be responsible for the maize crop. He has already lost part of the crop as a result of the respondent's conduct and may consequently fail to fully meet his obligations under the agreement and expose himself to a legal suit and requires protection by this court.

Under the circumstances, the balance of convenience weighs in his favour.

Despite the intervention of the Command Programme committee, the respondent is not privy to the agreement between the parties. The transfer of the crop to the respondent has no force of law as the resolution of the Committee does not amend the agreement between the applicant and the State and cannot replace the agreement.

Although the parties went to great lengths to argue who has the right to occupy the farm, I have found it not necessary to dwell on the issue. As rightly noted by the applicant, that issue is, following the appeal, for determination by the Supreme Court.

Other numerous submissions were thrown into the fray.

I am of the view that the submissions only cloud the issue at hand and it serves no purpose to allude to them.

What is now common cause is the fact that the applicant has a crop in the ground, part of which was destroyed by the respondent. He has noted an appeal against the decision in HH12380/16 which appeal is to be determined. The respondent cannot therefore proceed with the execution of the judgment in HC12380/16 in the face of the appeal in SC771/16.

The parties were agreed that in the event of an order being granted in favour of the applicant, it served no purpose for me to grant a provisional order. It was consequently agreed that I grant a final order.

The applicant did not seek any costs and accordingly none are awarded.

In the result, it is ordered that:

1. Pending the determination of the appeal in case number SC771/16, the respondent be and is hereby interdicted from interfering with the applicant's farming operations at subdivision 3 of Farm 45, Glendale, Mashonaland Central.

2. There is no order as to costs.

CC16-19 : PERFECT NYATHI vs THE STATE
Ruled By: MALABA CJ, GARWE JCC, MAKARAU JCC, GOWORA JCC, HLATSHWAYO JCC, PATEL JCC, GUVAVA JCC, MAVANGIRA JCC and BERE JCC

This is a referral in terms of section 175(4) of the Constitution of Zimbabwe Amendment (No.20) Act 2013 (“the Constitution”) from the Magistrate's Court (“the court a quo”) sitting at Gwanda.

After hearing argument from both the applicant and the respondent, the Court issued the following order:

“By consent: The matter is struck off the roll with no order as to costs.”

The reasons for the decision now follow.

The applicant testified as an “unconvicted accomplice witness” in the trial of one Dumisani Nyathi (“Nyathi”), who was charged in the court a quo with stock theft in contravention of section 114(2)(a) of the Criminal Law (Codification and Reform) Act [Chapter 9:23] (“the Criminal Law Code”). It was contended that Dumisani Nyathi had stolen fourteen head of cattle belonging to one Jethro Siziba.

All fourteen cattle were recovered from the applicant.

The applicant was arrested on 22 March 2018 on the same charges faced by Dumisani Nyathi and he appeared before the court a quo on 23 March 2018. The applicant alleges that he was released and served with a summons to appear in court on 29 March 2018. He also alleges that he was approached by the prosecutor, who requested him to testify against Dumisani Nyathi as an accomplice witness.

He said the prosecutor informed him that he would be given full immunity if he testified truthfully.

At the trial, the prosecutor indicated to the magistrate that the applicant was an accomplice in the commission of the offence charged against Dumisani Nyathi although he was still to be tried. He requested the court to warn the applicant in terms of section 267 of the Criminal Procedure and Evidence Act [Chapter 9:07] (“the CPEA”).

The applicant was duly warned by the court a quo.

The applicant alleges that, after testifying for the State, he was told, by the prosecutor, that he no longer needed to attend court on 29 March 2018 as per the summons that he had been served with and that he was a free man.

After a full trial, Dumisani Nyathi was acquitted of the charges against him.

The court a quo found that the applicant's evidence, to the effect that Dumisani Nyathi sold him the cattle, needed corroboration and that Dumisani Nyathi's defence had not been sufficiently disproved by the prosecution. The court also held that there was doubt that the applicant bought the fourteen cattle from the accused person, as there was no documentary proof or witnesses to that effect. More importantly, it was found that “the issue of selling cattle to Perfect Nyathi is very crucial and failure to adequately buttress it vitiates the State case.”

It ought to be noted, at this point, that the trial magistrate did not make a specific pronouncement as regards the applicant's liability to prosecution.

The respondent was dissatisfied with the outcome of the trial of Dumisani Nyathi and sought to appeal against the decision in the High Court. However, the official seized with prosecuting the matter was of the view that the appeal against Dumisani Nyathi's acquittal had no merit and that the State ought to pursue charges against the applicant instead.

On 8 November 2018, the applicant was summoned to appear in the court a quo on the charge of stock theft in contravention of section 114(2)(a) of the Criminal Law Code. It was now the State's case that the applicant, with the assistance of Dumisani Nyathi, had hatched a plan to steal the fourteen head of cattle.

On 4 January 2019, the applicant made an application to the court a quo for referral of the matter to the Constitutional Court. The basis of the application was that the applicant's right to a fair trial enshrined in section 69(1) of the Constitution would be infringed if the State was allowed to use him as an accomplice witness and thereafter turn against him and use the same evidence to secure a conviction against him.

It was also contended that the trial magistrate's failure to endorse the applicant's discharge on the record violated his right to a fair trial.

The respondent opposed the application on the basis that it was frivolous and vexatious.

It contended that the magistrate did not endorse on the record that the applicant be discharged from all liability to prosecution for the offence of theft of fourteen head of cattle because he was not satisfied that the applicant had fully answered all lawful questions put to him. The contention was that the applicant had not given evidence which tended to incriminate himself.

After hearing both parties, the magistrate said:

“The court also noted the fact that section 267(2) of the Criminal Procedure and Evidence Act is not clear on whether if immunity is not granted, should the same be endorsed on the record or not. Also, the court considered that there is nowhere in the Rules where it is stated that non-conviction in a matter where an accomplice witness gave evidence means that he/she did not answer fully to the satisfaction of the court and that immunity should be denied. The onus is, after all, on the State/prosecution to prove its case beyond a reasonable doubt and not on the accomplice witness to make sure that his/her testimony secures a conviction.”

It was also the court a quo's finding that the delay by the respondent in prosecuting the applicant was caused by the fact that the prosecutor believed that the applicant deserved immunity from prosecution.

The court a quo said that it was only after the failed attempt to appeal against Dumisani Nyathi's acquittal, and further pressure from the complainant, that the prosecution against the applicant was mounted.

The court a quo decided that the following question be referred to the Constitutional Court for determination:

“Whether the applicant's right to a fair hearing, as provided for in terms of section 169 (sic) of the Constitution, has been infringed by the respondent's decision to prosecute him on the same charges or cognate charges after using him as an un-convicted accomplice witness.”

Section 169 of the Constitution is concerned with the jurisdiction of the Supreme Court.

The section containing provisions on the right to a fair hearing is section 69.

Section 69 of the Constitution has four subsections making provision for different but related matters on the right to a fair hearing, such as having a fair trial within a reasonable time before an independent and impartial court, having access to the courts, and having access to legal representation.

The learned magistrate thought that a decision by the prosecutor to prosecute the applicant on charges in respect of which he had given evidence as an accomplice witness must, without more, give rise to a constitutional question on the alleged violation of the right of the applicant to a fair hearing of the charge he is to face.

The basis of the reasoning by the learned magistrate is not clear when regard is had to the fact that the decision to prosecute the applicant was influenced by the conduct of the trial court in terms of section 267(2) of the Criminal Procedure and Evidence Act [Chapter 9:07].

Where a trial court or a magistrate has not entered on the record of the proceedings the discharge of an accomplice witness from all liability to prosecution for the offence concerned in accordance with the requirements of section 267(2) of the Criminal Procedure and Evidence Act, the reasonable inference is that the trial court was not satisfied that the person answered fully all such lawful questions put to him or her as an accomplice witness. In the circumstances, the decision to prosecute the person for the offence concerned cannot be said to give rise to the constitutional question of violation of the person's right to a fair hearing of the charge.

Section 268 of the Criminal Procedure and Evidence Act protects such an accomplice by prohibiting the adduction of evidence against him or her in a prosecution for an offence in respect of which he or she gave evidence on behalf of the prosecution incriminating himself or herself at any trial in respect of the offence for which he or she is subsequently prosecuted.

The evidence is inadmissible against him or her at the trial.

Section 268 of the Criminal Procedure and Evidence Act is sufficient proof of the fact that mere giving of evidence for the prosecution at any trial in respect of an offence is no guarantee of immunity against prosecution for the same offence.

CC04-20 : INNOCENT GONESE and JESSIE MAJOME vs PARLIAMENT OF ZIMBABWE and SPEAKER OF THE NATIONAL ASSEMBLY and PRESIDENT OF THE SENATE and EMMERSON MNANGAGWA N.O. and PRESIDENT OF ZIMBABWE
Ruled By: MALABA CJ, GWAUNZA JCC, GARWE JCC, GOWORA JCC, HLATSHWAYO JCC, PATEL JCC, GUVAVA JCC, MAVANGIRA JCC and BHUNU JCC

The two applicants are Members of Parliament. They brought two separate applications in terms of section 167(2)(d) of the Constitution of Zimbabwe Amendment (No.20) 2013 (“the Constitution”), as read with Rule 27 of the Constitutional Court Rules.

They alleged failure by Parliament to fulfil the constitutional obligation to act in accordance with the procedure for amending the Constitution prescribed by section 328 of the Constitution.

The allegations in the applications are the same. So are the issues. The two applications were consolidated and heard as one.

The applicants challenged the validity of the proceedings that culminated in the passing of Constitutional Amendment Bill (No.1) 2017.

The relief sought is by way of a declaratory order in the terms that:-

1. Parliament failed to fulfil the constitutional obligation provided for in section 328(5) of the Constitution of Zimbabwe, which requires a Constitutional Bill to be passed by two-thirds of the membership of each House sitting separately, when it passed Constitutional Amendment Bill (No.1) of 2017 on 25 July 2017 and 1 August 2017 in the National Assembly and the Senate respectively.

2. Accordingly, the proceedings in Parliament, pertaining to Constitutional Amendment Bill (No.1) of 2017, on 25 July 2017 and 1 August 2017, be and is hereby set aside.

3. The first respondent pays costs of suit.

The Constitutional Bill was intended to amend section 180 of the Constitution insofar as it related to the procedure for the appointment of the Chief Justice, the Deputy Chief Justice, and the Judge President of the High Court. The proposed amendment would also add to section 180 of the Constitution a provision relating to the appointment of the Senior Judges of the Labour Court and the Administrative Court by the Chief Justice.

The application was filed on 6 September 2017. Before it could be heard, the President signed Constitutional Bill (No.1) 2017 into law.

The applicants filed another application under CCZ58/17. They sought an order setting aside the Constitutional Amendment Act on the basis that Parliament had failed to fulfil a constitutional obligation in the passing of the Constitutional Bill.

There are two distinct challenges to the passing of the Constitutional Bill.

The validity of the passing of the Constitutional Bill is challenged by impugning the proceedings in the National Assembly and the Senate.

In respect of the proceedings in each House, the contention is that the passage of the Constitutional Bill was in contravention of the amending procedure prescribed by section 328(5) of the Constitution. The grounds for the claimed violation of section 328(5) of the Constitution are different.

In respect of the proceedings in the National Assembly, the grounds raise factual questions, whilst the grounds in relation to the proceedings in the Senate raise a question of law.

The Court holds that the applicants have failed to show, on a balance of probabilities, that there was no voting conducted in the National Assembly. They also failed to show that the “Aye” votes did not reach the required minimum threshold of 180 votes.

The Court is of the view that the applicants have not been able to prove failure on the part of the National Assembly to act in accordance with the procedure for the amendment of the Constitution prescribed by section 328(5) of the Constitution.

The constitutional obligation imposed on Parliament, by section 328 of the Constitution, when exercising the power to amend the Constitution is to ensure that the procedures prescribed are complied with.

The Court entertains no doubt that, to amend the Constitution by the method prescribed by section 328, every requirement prescribed by the provision must be observed. The omission to comply with any one of the requirements is fatal to the validity of the proposed amendment.

The applicants established that the Constitutional Bill was not passed with the requisite two-thirds majority in the Senate. There was no compliance with the requirements of the procedure prescribed by section 328(5) of the Constitution.

The reasons for the decision now follow.

The Court notes the fact of the conflicting versions of facts and the interpretation of the applicable constitutional provisions. The granting of the relief sought by the applicants depends on one reality. It is discoverable by the finding of the facts on the matters in dispute, the declaration of the true meaning of the applicable constitutional provisions, and the application of the law to the facts.

The proposed amendment to section 180(1) of the Constitution was the cause of the events which culminated in the cause of action pleaded by the applicants for the relief sought. Nothing turned on the substantive value of the proposed amendment of the Constitution.

Before the proposed amendment, section 180 of the Constitution read as follows:

“180 Appointment of judges

(1) The Chief Justice, the Deputy Chief Justice, and the Judge President of the High Court and all other judges are appointed by the President in accordance with this section.

(2) Whenever it is necessary to appoint a judge, the Judicial Service Commission must -

(a) Advertise the position;

(b) Invite the President and the public to make nominations;

(c) Conduct public interviews of prospective candidates;

(d) Prepare a list of three qualified persons as nominees for the office; and

(e) Submit the list to the President; whereupon, subject to subsection (3), the President must appoint one of the nominees to the office concerned.

(3) If the President considers that none of the persons on the list submitted to him or her in terms of subsection (2)(e) are suitable for appointment to the office, he or she must require the Judicial Service Commission to submit a further list of three qualified persons, whereupon the President must appoint one of the nominees to the office concerned….,.”

Section 180 of the Constitution would read as follows after the proposed amendment:

“180 Appointment of judges

(1) The Chief Justice, the Deputy Chief Justice, and the Judge President of the High Court and all other judges are appointed by the President in accordance with this section.

(2) The Chief Justice, the Deputy Chief Justice, and the Judge President of the High Court shall be appointed by the President after consultation with the Judicial Service Commission.

(3) If the appointment of a Chief Justice, Deputy Chief Justice or Judge President of the High Court is not consistent with any recommendation made by the Judicial Service Commission in terms of subsection (2), the President shall cause the Senate to be informed as soon as is practicable: Provided that, for the avoidance of doubt, it is declared that the decision of the President, as to such appointment, shall be final.

(4) Whenever it is necessary to appoint a judge, other than the Chief Justice, Deputy Chief Justice or Judge President of the High Court, the Judicial Service Commission must -

(a) Advertise the position; and

(b) Invite the President and the public to make nominations; and

(c) Conduct public interviews of prospective candidates; and

(d) Prepare a list of three qualified persons as nominees for the office; and

(e) Submit the list to the President; whereupon, subject to subsection (5), the President must appoint one of the nominees to the office concerned.

(5) If the President considers that none of the persons on the list submitted to him or her in terms of subsection (4)(e) are suitable for appointment to the office, he or she must require the Judicial Service Commission to submit a further list of three qualified persons, whereupon the President must appoint one of the nominees to the office concerned.

(6) The President must cause notice of every appointment under this section to be published in the Gazette.

(7) The offices of senior judge of the Labour Court and senior judge of the Administrative Court must be filled by another judge or an additional or acting judge, as the case may be, of the court concerned, and are appointed by the Chief Justice after consultation with the Judicial Service Commission.”

FACTUAL BACKGROUND

The main contention by the applicants was that there was no proper vote in Parliament.

The allegations of fact on which the applicants' cause of action was based had no support from the evidence produced.

That was the case in respect of what they alleged happened in the National Assembly.

NATIONAL ASSEMBLY

The applicants made the following allegations of fact.

There were 234 Members of the National Assembly present in the House on 25 July 2017 out of a total number of 270. This appears from the Order Paper. There was a debate on the Mid-Term Budget Review and the Economic Outlook Statement presented by the Minister of Finance on 20 July 2017.

The fourth respondent (Emmerson Mnangagwa) moved a motion to adjourn the debate in favour of the presentation of the Constitutional Bill.

There was argument between the second respondent (the Speaker of the National Assembly) and Members of the opposition. Eventually, the second respondent agreed with the fourth respondent. He ruled that the House was to proceed with the third reading of the Constitutional Bill.

The first applicant (Innocent Gonese) moved a motion in terms of Standing Order 152(3) that the Constitutional Bill be sent back to the Committee stage to ensure that it incorporated matters that had not been included in the text.

The motion was disallowed by the second respondent.

Bells rang so that voting could commence. According to the applicants, the House was not properly divided at this stage.

A point of privilege was raised to the effect that there had to be a secret vote.

The raising of the point, that the voting be by secret ballot, was based on the suspicion that some Members of the ruling party had been intimidated to vote for the Constitutional Bill. The contention was that a secret ballot was necessary in the circumstances.

The second respondent ruled that the vote was not going to be by secret ballot.

While the point of privilege was being considered, the tellers were counting Members. The Members who were sitting on the Government benches were counted as part of the “Aye” vote. Those who sat on the opposition benches were counted as being part of the “Noe” vote.

The tellers told the second respondent that the “Aye” votes were 187.

The first applicant raised an objection and pointed out that the second respondent had the obligation to ascertain whether there were more than 180 Members in the House. He argued that the second respondent was obliged, by Standing Order 127, to separate Members who voted in favour of the Constitutional Bill from those who voted against it.

The applicants aver that the process was not in accordance with Standing Order 127. They relied on the un-revised Hansard and the Order Paper to advance their argument.

According to the unrevised Hansard, there was commotion in the House following the communication to the second respondent by the tellers that 187 Members had voted in favour of the Constitutional Bill.

Some Members left the House.

The second respondent acceded to the request that the counted numbers should be verified.

The Sergeant-at-Arms was ordered, by the second respondent, to conduct a recount.

After the recount, the un-revised Hansard records that the second respondent said:

“After the verifications, the figure given of the results of the count is: Ayes – 182 and the Honourable Members who left are Honourable Matuke, Honourable Chinomona, Honourable Ruvai, Honourable Nyamupinga and Honourable Muchenje. Those against – 41. The number of affirmative votes recorded is not less than two-thirds of the membership of the House.

I, therefore, declare the final votes in the House on the Constitutional Amendment Bill to have been in accordance with the provisions of section 328(5) of the Constitution.”

According to the applicants, the irregularities in the vote were as follows -

1. When the bells were rung, the doors of the Chamber were closed. Before the vote was concluded, and before the verification was conducted, an Honourable Member walked in.

2. The second respondent breached the Standing Orders by opening the doors before the process of the vote was completed.

3. No vote took place and the verification process became the vote. The counting of the votes was based on an assumption that those on the Government benches supported the motion. This is not permitted by the Standing Orders and the Constitution.

4. The second respondent failed to properly divide the House, as is required by the Rules.

5. The second respondent did not allow the Chief Whips and the Sergeant-at-Arms, together with the tellers, to move around to make the necessary verifications after the vote.

6. Honourable Pedzisayi was counted twice for the “Aye” votes according to the Order Paper.

The applicants averred that the names of those alleged to have voted with the “Ayes” appear in both the un-revised Hansard and the Order Paper. According to both sources, there were 182 “Aye” votes. Those who voted with the “Ayes” included the names of Honourable Beremauro G, Honourable Mukanduri and Honourable B Tshuma. These Members were not in Zimbabwe on 25 July 2017. They were in Uganda on a Parliamentary visit.

The allegation was also that Honourable D Marapira and Honourable G Mabuwa, who were recorded as part of the Members who voted in favour of the Constitutional Bill, were absent on official leave.

The applicants said that Honourable M Chikukwa, Honourable M Hlongwani, Honourable P Dutiro, Honourable Y Simbanegavi and Honourable D Ndlovu were not present. They were, nonetheless, recorded as being part of the “Aye” vote.

According to the applicants' calculation, there were 171 “Aye” votes against a required threshold of 180 votes in favour of the proposed amendment to the Constitution.

There was a contradiction in the averments.

The applicants alleged that voting did not take place in the National Assembly. They also said that the vote was conducted in an irregular manner. They averred that the required minimum threshold of 180 votes in favour of the Constitutional Bill was not reached in the National Assembly....,.

On the merits, the first and the third respondents averred that the procedural requirement that there must be an affirmative two-thirds vote for a valid Constitutional amendment was complied with.

The second respondent averred that he acted in accordance with Standing Order 127 in the conduct of the vote.

The bells were rung, and all Members present moved into the Chamber. He then appointed tellers and divided the House, by directing that the “Ayes” should go to the right and the “Noes” should go to the left. An objection was raised when the House had already been divided. The unrevised Hansard relied on by the applicants did not capture everything that transpired. The revised Hansard and the audio recording show that voting was conducted properly. There were 182 “Aye” votes as recorded in the corrected Hansard, unlike the numbers relied on by the applicants which are based on the unrevised Hansard.

The first and the second respondents relied on the Journal of the House (“the Journal”) and alleged that it was the correct record of the proceedings of the House. They alleged that the un-revised Hansard, relied upon by the applicants, was subsequently corrected after reconciliation with the audio recording.

Their position was that, contrary to the allegations made by the applicants, the audio recording captured both the division of the House and the conducting of the vote.

The first and the second respondents contended that the applicants' case was based on the report in the unrevised version of the Hansard. The names of those Members who voted were corrected in the Journal in terms of Standing Order 131. They explained that, in terms of the procedure of the Journals Office and the Hansard Operational Manual, the corrected version of the Hansard and the corrected Votes and Proceedings were filed in the Journal of the House, which is bound at the end of each Session.

The Master Copy of the Hansard was prepared by the Hansard Reporters after they had gone through the un-revised version of the Hansard while listening to the audio recording.

The Order Paper relied on by the applicants contained errors, which were corrected using this method.

The second respondent conceded that, according to the corrected records, Honourable Mukanduri, Honourable Beremauro and Honourable Tshuma were out of the country. However, he maintained his position that Honourable Marapira and Honourable Mabuwa were present during the proceedings in the House relating to the voting on the Constitutional Bill. Their inclusion on the list of Members absent with leave was an error which was corrected.

The second respondent maintained that, whilst the Hansard is the official report of the proceedings in Parliament, it does not necessarily constitute an accurate record of what transpired on the day in question. The accurate record is contained in the Journal, which is bound at the end of each Session after it has been proof-read and corrected if necessary. The Journal is a security item and is kept by the Clerk of Parliament.

The second respondent stated in the opposing affidavit, in part, as follows:

“I conducted the vote in terms of Standing Order 127. The un-revised Hansard relied upon by the applicants did not capture that part. The audio record recording at minute 01:58:16-20 (which audio will be played at the hearing if required) and the corrected Hansard (vide 'CC' hereto) clearly show that the voting was done properly…,.

It is also important for this Court to note that, unlike the unrevised Hansard, the Journal (vide Annexure 'BB' hereto) is the correct record of proceedings. See also the alterations of the Master Copy of the Hansard (vide Annexure 'CC') before submitting it to the printers to produce Annexure 'DD' hereto which forms part of the Journal….,.

These allegations are denied.

The audio recording clearly shows what transpired…,. The applicant relied on the 'Unofficial Report Un-revised' Hansard as shown on its cover and the 'Advance copy - Uncorrected Votes and Proceedings' which the applicant is referring to as the 'Order Paper', which may, at times, contain errors, as in this case, and such errors in the names of the division list were corrected in the Journal of the House in terms of Standing Order 131 of the Standing Rules and Orders of the National Assembly.”

The second respondent took the argument further.

He averred that the unrevised Hansard left out four Members, Honourable Muchinguri, Honourable Mukupe, Honourable Madzinga and Honourable D Mpofu, who were present and voted with the “Ayes”. This was confirmed by the Attendance Register and the corrected copy of Votes and Proceedings.

According to this record, the “Aye” votes remained at 182.

It was also the second respondent's contention that the Attendance Register and the corrected copy of the Votes and Proceedings showed those Members who were present and voted for the proposed amendment of the Constitution. According to these records, Honourable Chikukwa, Honourable Hlongwani and Honourable Dutiro were present and voted “Aye”.

In terms of the Attendance Register compiled by the Sergeant-at-Arms, Honourable Simbabegavi was marked absent but she came late and participated in the voting and voted with the “Ayes”.

The second respondent alleged that the Sergeant-at-Arms failed to correct the error.

As for Honourable D Ndlovu, the second respondent said there was an error. The intended entry was Honourable A Ndlovu.

In regard to the issue that Honourable Pedzisayi was counted twice, he admitted that there was an error, which was corrected in terms of Standing Order 131.

The second respondent maintained that the Journal confirmed that 182 Members voted in favour of the Constitutional Bill. He contended that the Constitutional Bill was passed in accordance with the procedure prescribed by section 328(5) of the Constitution.

Finally, the first and the second respondents averred that, at the verification of the votes, the five Members who had voted, but subsequently left the House, were not included in the 182 “Ayes”. They had initially been counted as part of the 187, but were excluded following the verification exercise because they had left before the verification was conducted.

The applicants alleged, in their answering affidavits, that the documents relied on by the first, the second and the third respondents were fabricated, doctored, and tampered with.

The applicants relied on the unrevised Hansard and the Order Paper. They rejected the corrections made to the documents.

The first applicant averred, in the answering affidavit, as follows:

“I also wish to state that the recordings of Parliament, on the 25th of July 2017, must have been recorded and captured on video.

Surely, this Honourable Court has powers, which I do not have, of summoning both the video recording of what happened in Parliament which I notice the respondents do not refer to in their papers.”...,.

The interpretation and application of the provisions of section 328 of the Constitution, in the context of the effect of the principles on the amendment of the Constitution, disclose the invalidity of the passing of the Constitutional Bill in the Senate.

The process confirms the constitutionality of the conduct of the National Assembly....,.

Section 328 of the Constitution provides, in part:

“328 Amendment of Constitution

(1) In this section —

'Constitutional Bill' means a Bill that seeks to amend this Constitution;…,.

(2) An Act of Parliament that amends this Constitution must do so in express terms.

(3) A Constitutional Bill may not be presented in the Senate or the National Assembly, in terms of section 131, unless the Speaker has given at least ninety days' notice in the Gazette of the precise terms of the Bill.

(4) Immediately after the Speaker has given notice of a Constitutional Bill, in terms of subsection (3), Parliament must invite members of the public to express their views on the proposed Bill in public meetings and through written submissions, and must convene meetings and provide facilities to enable the public to do so.

(5) A Constitutional Bill must be passed, at its last reading in the National Assembly and the Senate, by the affirmative votes of two-thirds of the membership of each House.

(6) Where a Constitutional Bill seeks to amend any provision of Chapter 4 or Chapter 16 —

(a) Within three months after it has been passed by the National Assembly and the Senate in accordance with subsection (5), it must be submitted to a national referendum; and

(b) If it is approved by a majority of the voters voting at the referendum, the Speaker of the National Assembly must cause it to be submitted, without delay, to the President, who must assent to and sign it forthwith.”...,.

The amendment of different Constitutional provisions is not done by the same process.

An amendment of a provision other than Chapter 4, Chapter 16 and section 328 of the Constitution requires affirmative votes to be not less than two-thirds of the membership of each House of Parliament.

An amendment of a provision under Chapter 4, Chapter 16 and section 328 requires a referendum in addition to the special majority referred to in section 328(5) of the Constitution.

The Constitution thus follows the tradition whereby certain subjects are too important to be amended by a special majority in Parliament. This means that the issue of constitutional amendment is not an ordinary provision. It is one which enjoys special protection by the Constitution itself.

When interpreting section 328(5) of the Constitution, this underlying principle ought to be borne in mind.

INTERPRETATION OF SECTION 328(5) OF THE CONSTITUTION

The question for determination is whether section 328(5) of the Constitution requires that the amount of the votes in support of the Constitutional Bill must not be less than two-thirds of the total number of persons the Constitution declares that the House consists of. Does the subsection mean that the votes must not be less than two-thirds of the Members of the House who are alive and capable of voting at the time the voting is conducted?

The two Houses of Parliament interpreted the phrase “the membership of each House”, as used in section 328(5) of the Constitution, differently.

The National Assembly interpreted the words to mean the total number of persons the Constitution has declared the House to consist of as its Members. The Senate interpreted the phrase to mean the number of Members of the House who are alive and capable of voting at the time the vote on the proposed amendment to the Constitution is taken at the third reading.

The interpretation must take into account the language used, the context, the subject-matter, the purpose, and the object of section 328(5) of the Constitution. The Court must bear in mind that it is the Constitution it is construing.

Section 328(5) of the Constitution is a fundamental law which prescribes the procedural and substantive requirements for a valid amendment of the Constitution. It sets out an objective standard for the determination of the validity of the amendment. The words “the membership of each House”, as used in section 328(5) of the Constitution, refer to an element of the prescribed requirements of the objective standard for the measurement of the validity of the amendment of the Constitution which is peculiar to each House.

The requirement that the amount of the vote in favour of the Constitutional Bill must be not less than two-thirds of the membership of the House is applicable to votes by each House. The only factor of the requirement of the objective standard for the measurement of the validity of the proposed amendment which differentiates one House from the other, and relates to its membership, is the total number of persons the Constitution declares to be what each House consists of.

Section 120(1) of the Constitution provides that the Senate consists of eighty Senators, who become its members by being elected by the electorate in the manner prescribed. Section 124(1) of the Constitution provides that the National Assembly consists of two hundred and seventy Members, who are elected in the manner prescribed.

It is necessary to consider the meaning and purpose of other provisions of the Constitution that have a bearing on the subject of section 328(5) of the Constitution. No single constitutional provision may be taken out of its context and interpreted by itself.

The fundamental principle is that a Constitution is a mode of limited government, characterised by the apportionment and distribution of powers. The powers concerned must be exercised for the benefit of the people as a whole in accordance with the constitutionally prescribed procedures.

Section 117(2)(a) of the Constitution expressly provides that the power to amend the Constitution conferred on the Legislature must be exercised in accordance with section 328 of the Constitution.

Sections 120(1) and 124(1) of the Constitution are the laws governing the composition of the Houses. The contents of each provision provide the meaning of the words “the membership of each House”, as used in section 328(5) of the Constitution.

The subject-matter of section 328(5) of the Constitution is the objective standard for the measurement of the validity of the amendment.

As an element of the standard by which the validity of the amendment of the supreme law of the land is to be measured, the membership of each House has to be a constant element enjoying a degree of permanence. Considering the fact that amendment of section 328(5) of the Constitution is rendered more difficult by the requirements of section 328(9) of the Constitution, the membership of each House, in the context of section 328(5) of the Constitution, is a constant factor.

Section 138(1) of the Constitution provides that all questions proposed for decision in either House of Parliament are to be decided by a majority of the votes of the Members of that House present and voting.

The provision of a special procedure, under section 328 of the Constitution, for the exercise of the power to amend the Constitution, means that the procedure prescribed by section 138(1) of the Constitution is not applicable to the special process of amending the Constitution.

The exclusion of the procedure for deciding questions proposed for decision in either House of Parliament, prescribed in section 138(1)(a) of the Constitution, from the special process of amending the Constitution is evidence of the intention of the makers of the Constitution to protect the Constitution from fluctuating standards for the measurement of the validity of the amendment of the Constitution.

The effect of the contention by the respondents that the words “the membership of each House”, as used in section 328(5) of the Constitution, mean the total number of Members of the House who are alive and capable of voting at the time the vote is taken is the importation of the procedure prescribed by section 138(1)(a) of the Constitution into the special process of amending the supreme law of the land.

The interpretation of the words “the membership of each House”, as used in section 328(5) of the Constitution, to mean the total number of persons the Constitution declares each House to consist of is consistent with the object of the provision.

The purpose and object of the requirements of the procedure for the exercise of the power to amend the Constitution, prescribed by section 328(5) of the Constitution, is to ensure that the amendment of the Constitution is of common benefit to the people. The procedural and substantive requirements of section 328(5) of the Constitution ensure that there is representation of the people and protection of their interests in the process of the amendment of the Constitution.

In making the Constitution, and committing themselves to it as the supreme law of the land, the people imposed on themselves the obligation to accept an amendment of the Constitution effected by a vote in accordance with the standard of validity prescribed by section 328(5) of the Constitution.

The meaning of the words “the membership of each House” as the whole number of persons the Constitution has declared the House to consist of receives support from the provisions of section 344(3) and (4) of the Constitution. The section reads, in relevant part, as follows:

“344 Quorum and effect of vacancies in Constitutional bodies

(1)…,.;

(2)…,.;

(3) Any reference in this Constitution to the votes of —

(a) Half of the membership of a body whose membership is not a multiple of two;

(b) Two-thirds of the membership of a body whose membership is not a multiple of three; or

(c) Three-quarters of the membership of a body whose membership is not a multiple of four; is to be interpreted to mean that the number of votes must be not less than the whole number next above one-half, two-thirds or three-quarters, as the case may be, of the body's membership.

(4) Any reference to the total membership of Parliament is a reference to the total number of persons who, for the time being, are Members of Parliament.”

Counsel for the applicants argued that the Constitution maintains a distinction between section 344(4) and section 328(5).

He submitted that the Constitution must be interpreted purposively and not in the abstract.

He took the point further and argued that section 344 is not a substantive section. It is a definition section. There is a difference in the construction of the two. Any other interpretation would render section 328(5) meaningless. The provision is meant to make constitutional amendment difficult.

He finally argued that section 328 of the Constitution grades different provisions based on how important they are.

Counsel for the first, second, and third respondents a contrary view.

He argued that the first port of call is the definition of “Member of Parliament” in the Constitution. 'Membership' is derived from 'Member of Parliament'. Hence, in order to understand what “membership” means, regard has to be had to the definition of “Member of Parliament”. Membership depends on the construction of 'Member of Parliament'.

He further contended that the law does not allow for a vacuum.

The interpretation to be given to the provision must be one which best achieves the intention of the lawmakers.

Counsel for the first, second, and third respondents urged the Court to find, in respect of the Senate, that the relevant number is 79. He said the reason was that section 328(5) of the Constitution relates to “membership”, which is derived from “Member”. 'Member of Parliament' relates to a person who is alive and is able to carry out Parliamentary business.

Section 344(4) of the Constitution is related to sections such as section 109(1), which relates to a vote of no confidence in Government, section 114(2), which relates to the revocation of a declaration of war, section 113(2), which relates to the approval of a declaration of a State of Emergency, section 122(8)(f), which relates to the vacation of office by the President of the Senate, and section 126(8)(f), which relates to the vacation of office by the Speaker.

The provisions, which give substance to section 344(4) of the Constitution, show that its application is determined by the subject-matters to which the specific provisions relate and is confined to those provisions. The provisions of section 344(4) cannot be interpreted as giving meaning to section 328(5) of the Constitution. To the contrary, section 344(4) of the Constitution sheds light on what section 328(5) of the Constitution does not mean.

There is no provision which is similar to section 328(5) in the Constitution.

The contrast can be seen in section 113(6) of the Constitution, which provides:

“113(6) If, by a resolution passed by a majority of the members present at a joint sitting of the Senate and the National Assembly, Parliament resolves that a declaration of a State of Public Emergency —…,.”…,.

This provision relates to Members “present”.

The majority that carries the day depends on the Members actually present and voting.

Another example of a similarly worded provision is section 138 of the Constitution, which provides:

“138 Voting and right of audience in Parliament

(1) Except where this Constitution provides otherwise —

(a) All questions proposed for decision in either House of Parliament are decided by a majority of the votes of the Members of that House present and voting;…,.”

The provision under which the Constitution is amended does not relate to the presence of the Members. Its provisions are an exception referred to in section 138(1) of the Constitution.

It means that, in terms of section 328(5) of the Constitution, the controlling concept is the membership of the House, which relates to the total number of persons the House is declared, by the Constitution, to consist of. The number does not fluctuate since it is fixed by the Constitution.

It is a definite number.

When the provisions are contrasted, it becomes apparent that “the membership of each House”, as used in section 328(5) of the Constitution, does not mean persons who are, at any given time, Members of Parliament.

Section 328(5) of the Constitution has two references to membership of the House. The first relates to the exercise of the power to vote. The vote can only be cast by Members of Parliament who are present and voting. The second reference is to the objective standard for the measurement of the votes cast in favour of the proposed amendment to the Constitution. It is the requirement of that objective standard that the votes in favour of the proposed amendment must not be less than two-thirds of the membership of the House concerned.

For the purposes of the objective standard for the measurement of the validity of amendment of the Constitution, in terms of section 328(5) of the Constitution, the makers of the Constitution decided to fix the minimum threshold to be reached by the votes in favour of the proposed amendment by reference to the constant constitutive element of each House. They were free, in the exercise of the power of sovereignty, to do so. They were not under delegated authority, as the Legislature is.

Section 328(5) of the Constitution is not in conflict with any other provision of the supreme law. The matters it regulates are exclusive to its provisions.

“The membership of each House” is an essential element of the requirement of the objective standard fixed by the fundamental law. It is therefore binding on all Members of the House, individually and collectively, in the exercise of the power to amend the Constitution.

The people decreed, by the supreme law, that the validity of the exercise of the power to amend its provisions be determined by application of an objective standard, which takes into account the representation and the protection of their interests.

When searching for the true construction of a constitutional provision, a court must constantly bear in mind that its authors were not executing a delegated authority, limited by other constitutional constraints. They were establishing a fundamental law. To that extent, the people, in the exercise of the power of sovereignty, were intent upon establishing such principles as seemed best calculated to produce good government and promote public happiness. They did so at the expense of any, and all, existing institutions which might stand in their way.

The objective standard for the determination of the validity of the proposed amendment of the Constitution is applied to the amount of votes in favour of the amendment at the third reading. It is that vote which decides the question whether the Constitutional Bill is passed by the House concerned. Compliance with all the procedural requirements prescribed by section 328 of the Constitution is obligatory.

In enacting the provisions of section 328(5) of the Constitution, the people deliberately chose the formulation of the objective standard for the determination of the validity of an amendment of the Constitution. The objective standard subjects the votes in favour of the proposed amendment to a minimum threshold fixed by reference to the whole number of persons fixed by the Constitution itself as the anchor for the standard. The people settled for the formula prescribed by section 328(5) of the Constitution because they were satisfied that its application would secure the object of protection and promotion of their interests. It is a means of affording indirect popular participation in the process of amending the fundamental law.

Section 344(3) of the Constitution relates to provisions which use the formula for determining the validity of decisions on any questions for decision by the House by requiring the votes in favour of what is proposed to reach a minimum threshold fixed by reference to the membership of the body. The sub-section prescribes what should happen when “the membership of a body” is not a multiple of the denominator to the vulgar fraction to express the minimum threshold.

The words “membership of a body”, as used in section 344(3) of the Constitution, relate to the whole number of members the body is declared by the Constitution to consist of.

It is clear, from section 344(3) of the Constitution, that reference to the “membership of a body” in any provision of the Constitution is reference to the total number of persons the Constitution has declared the body to consist of.

It is important to note, for the purpose of the determination of the question before the Court, that section 344(3) of the Constitution refers to “the membership of a body” when used in the Constitution in reference to the votes of a constitutional body.

Section 328(5) of the Constitution falls into the category of provisions in which the formula fixing the minimum threshold for votes in favour of the proposed action by reference to the membership of the body concerned is used.

The words “the membership of each House” are used in section 328(5) of the Constitution in a constitutive sense to refer to what constitutes each House, as prescribed by the fundamental law. The words refer to what constitutes the full strength of each House.

The correctness of the construction of section 328(5) of the Constitution, linking the minimum threshold the votes in favour of the proposed amendment of the Constitution have to reach to the whole number of Members making up each House, as fixed by the Constitution itself, is supported by the provisions of section 344(4) of the Constitution.

Section 344(4) of the Constitution provides that any reference in the Constitution to “the total membership” of Parliament is reference to the total number of persons who for the time being are Members of Parliament.

The definition of the total membership of Parliament is given immediately after the provisions of section 344(3), where reference is made to “the membership of a body”.

The effect of section 344(4) of the Constitution is that where reference is made in a provision of the Constitution to the “membership of a body”, and that body is one of the Houses of Parliament, reference is not being made to the total number of persons who for the time being are Members of Parliament.

Section 332 of the Constitution defines “Member of Parliament” to mean a Senator or a Member of the National Assembly.

The people decided that the objective standard for the determination of the validity of an amendment of the Constitution should not include an essential element which would depend on the effects of unpredictable occurrences of such events as death or removal from office of Members of either House. This self-restriction in the Constitution serves to guarantee stability and respect for the established constitutional order.

The amendment of the Constitution must not be an easy process.

Section 328 of the Constitution prescribes the procedure for amending the Constitution, reflecting different degrees of difficulty depending on the provision sought to be amended. The amendment of the Constitution is a matter on which the public places a lot of importance. A swift and easy method of amending the Constitution would weaken the sense of security which the rigid Constitution gives. There would be too little distinction from the method for amending ordinary legislation. That would erode the special status of the supremacy of Constitutional Law.

The Constitution would not occupy the special place it occupies today in the country's legal system.

Changing provisions of the Constitution, without following the special procedure provided for in section 328, would expose the Constitution to passing interests. The idea reigns that solidity and security are the most vital attributes of a fundamental law. See BRYCE “The American Commonwealth” Vol 1…,.

The effect and substantive value of the foundational principle of supremacy of the Constitution is that, once ordained by the people, the Constitution and its provisions bind the people themselves. The people must respect and obey the dictates of what has been done by Parliament within the ambit of the limited powers they would have conferred on it and in accordance with the procedure they would have prescribed for its conduct.

Democracy is a limited form of government. The principle of supremacy of the Constitution is to the effect that, once the people have given the representatives they would have put in Parliament, the power to make the final decision by the prescribed amount of votes in favour of the amendment of the Constitution in accordance with the prescribed procedure, they would have bound themselves to accept the amendment as being in the common interests of the entire people.

Therein lies and governs the principle of the rule of law.

It is to the effect that law is the master to be obeyed by the State, every person, and every institution and agency of Government at every level.

When a Member of a House of Parliament casts a vote in favour of the proposed amendment to the Constitution, he or she is discharging a democratic mandate. He or she is not casting the vote for personal interests. The principle of representative democracy guarantees every Member of Parliament not only freedom in the exercise of his or her mandate but also equal status as a representative of the entire people.

In principle, each House complies with its function as a body of representation in its entirety. The law does not differentiate votes in favour of the proposed amendment to the Constitution according to the political affiliation of the Members casting the votes. The voter acts as a Member of the House who is required to act in accordance with his or her conscience within the confines of the duties of the office of membership.

The fact that a political party with a majority of Members of Parliament manages to secure the requisite special majority of two-thirds of the membership of the House to amend the Constitution does not change the fact that, at law, the affirmative votes for the amendment of the Constitution represent the entire citizenry.

The reason is that, although cast by an individual, the vote is an exercise of the power belonging to Parliament as a constitutional body established for the purpose of exercising legislative authority for the common good of the entire people. The people established Parliament as a means by which they would exercise, through representatives, the legislative authority they vested it with for their common interests. The Constitution creates a representative democracy, under-girded by the doctrine of separation of powers.

The interpretation of section 328(5) of the Constitution must seek to give effect to the fundamental values on which a republican form of government is founded.

Section 328 of the Constitution does not only prescribe the procedures that those entrusted with the power to amend the fundamental law have to keep in mind and bear the obligation to act according to their requirements in the exercise of the power. The duty-bearers must also appreciate the rationale behind the limitation on the exercise of the power conferred on them in the context of the dynamism of the relationship with the people. They have to appreciate the legal consequences of failure to act in accordance with the procedures prescribed by section 328 of the Constitution.

ANALYSIS OF THE FACTS

NATIONAL ASSEMBLY

The parties agreed that the applicable figure with regards the National Assembly is 270. They agreed that two-thirds of that number is 180.

The agreement was based on the interpretation of section 124(1) of the Constitution which provides for the composition of the National Assembly.

The question was whether the applicants established, on a balance of probabilities, that there was no vote in Parliament.

The cause of action, as pleaded, was the alleged complete failure by the Speaker to conduct voting proceedings in the House to enable the Constitutional Bill to be passed. In the same breath, the applicants accepted that the voting did take place.

The cause of action, on this version of pleadings, was that the votes cast in favour of the Constitutional Bill failed to reach the minimum threshold of 180 votes required by the provisions of section 328(5) of the Constitution.

The finding of the facts in issue depended on the finding on the accuracy of the sources of information produced as evidence by the parties.

It is necessary to make a finding on the credibility of the evidence adduced by the parties.

Counsel for the applicants argued that the unrevised Hansard and the Order Paper showed that the votes in favour of the Constitutional Bill did not reach the required minimum threshold of 180. He said the 182 votes relied upon by the respondents to prove compliance with the procedural and substantive requirements of section 328(5) of the Constitution included Members who were in Uganda on official duties and those who were absent for undisclosed reasons.

When asked why the records of Parliament were later corrected, counsel for the applicants argued that the “correction” was not a correction; it was a “creation” because the error in the original documents had not been identified. He went on to argue that “the so-called correction” went to the substantive business of Parliament.

He said it introduced a record that differed materially from the one reflective of the contemporaneous objections made by the first applicant during the proceedings of 25 July 2017.

The contention was that the correction was designed to cover up the irregularities in the proceedings conducted by the Speaker.

Counsel for the first, second, and third respondents took the view that there was compliance with the Constitution.

He argued that the applicants' cause of action was premised on the un-revised Hansard and Order Paper, documents subsequently lawfully corrected. He argued that the amended documents of Parliament remain extant until they are set aside. He reasoned that there was a need for an application for a declaration of invalidity of the amended documents because they are an official record of Parliament.

The contention was that there was nothing in the applicants' case on which reliance could be placed for rebuttal of the presumption that the contents of the official documents in the revised version represent the truth.

The Court noted that the applicants produced documents, the contents of which supported some of the averments they made. The respondents did not take issue with the authenticity of the documents produced by the applicants to support their case. The second respondent accepted that the documents were authentic.

The point of departure was that the second respondent took the view that the documents relied upon by the applicants were inaccurate. They were subsequently lawfully corrected. The applicants, on the other hand, rejected the corrections made to the documents, describing them as “creations”.

The evidence showed that the Hansard recorders recorded at ten minute intervals. In addition, there was an audio recording of proceedings. There was also a video recording process which was contemporaneous with both the manual and audio recordings. A closer analysis of the scenario suggests that Parliament had realised that it could not rely on the Hansard recorders' record only. The fact that there were contemporaneous audio and video recordings of the proceedings was an indication of the fact that there was an acceptance of the fact that a manual recording process is potentially inaccurate.

It was difficult to understand why the applicants sought to rely on the manual recording of the Hansard recorders, which was the basis of the unrevised Hansard. It is the audio and video recordings which are used to correct the un-revised Hansard record so that it reflects accurately what transpired in the National Assembly.

The second respondent stated that the un-revised Hansard and the Order Paper used by the applicants were corrected in terms of Standing Order 131. The applicants did not deny that those documents could be lawfully corrected in terms of Standing Order 131.

Standing Order 131 provides that:

“…, if the numbers have been inaccurately reported or an error occurs in the names of the division lists, the chair, on being informed of such errors, must order the Journal of the House to be corrected.”

Standing Order 199, on the Journal of the House, provides:

“199 (1) The Clerk must produce the Votes and Proceedings of the House which must be printed and distributed to Members from day to day.

(2) The Votes and Proceedings so printed, bound, and signed by the Speaker, must constitute the Journal of the House.”

KATHERINE SWINTON, in an article titled “Challenging the Validity of an Act of Parliament: The Effect of Enrolment and Parliamentary Privilege”, Osgoode Hall Law Journal, Vol 14, No.2 (October 1976)…, while writing on Parliamentary practice, said:

“Therefore, the enrolled copy of an Act would appear to be the original copy retained by the Clerk of the Parliaments. This makes no reference to the number of votes recorded nor the number of readings in the passage of the bill, showing only that the House of Commons and Senate passed the bill and royal assent was recorded on stated dates.

To learn of the exact number of votes in favour of a bill and the number of readings, it is necessary to refer to the Journals of the respective Houses or to Hansard.

The Journals are the official record of the proceedings of the House. They are compiled daily from the 'scroll' of the Clerk. The scroll, in reality, foolscap sheets written in longhand by the Clerk, records the events of the House, whether the tabling of documents, the readings of a bill, or the votes on a bill or an amendment.

The Journals made up from the scroll are more comprehensive, as they include the text of amendments and the results of recorded divisions, as well as the date of royal assent to bills, the Speaker's rulings on procedure and questions of privilege, and the text of royal recommendations.

According to BEAUCHESNE, any conflict between the scroll and the Journals would be solved by reliance on the Journals.

The Journals do not serve the same purpose as Hansard, although there is some slight degree of overlap in their content.

Hansard records the verbatim proceedings of the House, that is, the speeches and comments in the Chamber. The Journals are much more cryptic and are similar to minutes of a meeting. Their judicial treatment is also potentially different: the Journals are admissible evidence, whereas Hansard is normally excluded.

In practice, it may be that the Journals can rarely be admitted due to Parliamentary privilege, but, they are at least potentially open to judicial scrutiny.”…,.

When the second respondent produced documents that corrected some of the errors, it was incumbent on the applicants to rebut the respondents' version by tendering evidence which showed that the respondents' version of events could not be possibly true.

In paragraph 58.4 of the first applicant's answering affidavit, he averred:

“This is why, even at this late stage, the second respondent has failed to produce affidavits from the two Honourables Mabuwa and Marapira to prove that they were in Parliament. They were not. I do not recall seeing them there and the Hansard confirms this.”

The second respondent denied the averment and produced documents that proved that the two Members were in the House during the time the voting for the proposed amendment of the Constitution was conducted.

It was not for the second respondent to prove the presence of the Members concerned. It was for the applicants to prove their absence.

The applicants obtained an affidavit from the Honourable Brian Tshuma, who said that at the relevant time he was away in Uganda on Parliamentary business.

That fact did not take the applicants' case any further.

It was confirmed by the corrected record of proceedings.

The applicants did not allege that they had correlated the manual recording and the audio recording in order to verify the accuracy of what the respondents alleged. On the other hand, the second respondent took the trouble to go through the audio recording in order to satisfy himself that the unrevised Hansard tallied with it. As a result of the process, the second respondent made corrections to the master copy of the un-revised Hansard to create documents that accurately reflected what transpired in the House on 25 July 2017.

The applicants cannot deny the correctness of the audio recording without themselves having correlated their unrevised Hansard to the audio recording.

One cannot deny the correctness of a superior recording mechanism on the strength of a document prepared using a potentially inaccurate method of recording without first verifying the contents of the more superior method of recording.

Before criticising the revised Hansard, the applicants needed to correlate the manually prepared Hansard with the audio recording.

The version backed by the evidence with more probative value is the one to be preferred.

The probative value of evidence is impacted upon, negatively or positively, as the case may be, when regard is had to the manner in which the evidence was compiled. The documents produced by the second respondent are corroborated by the audio recording, the more accurate of the means of recording.

The Court would lean towards the party who took the trouble to revisit the audio recording.

The National Assembly is a creature of the Constitution and it is one of the constituent parts of Parliament. There is a presumption of constitutionality as regards the conduct of business of the House. It has been said that the presumption is in favour of every legislative act, and that the whole burden of proof lies on the party who denies its constitutionality: Brown v Maryland 25 US 419, 436 (1827); Lawrence v State Tax Commission of Mississippi 286 US 276, 283 (1932).

Having made the finding that the revised Hansard is the true record of what ensued in the National Assembly, regard must be had to the contents of the revised Hansard in an effort to establish whether or not a vote did take place in the House.

CC04-20 : INNOCENT GONESE and JESSIE MAJOME vs PARLIAMENT OF ZIMBABWE and SPEAKER OF THE NATIONAL ASSEMBLY and PRESIDENT OF THE SENATE and EMMERSON MNANGAGWA N.O. and PRESIDENT OF ZIMBABWE
Ruled By: MALABA CJ, GWAUNZA JCC, GARWE JCC, GOWORA JCC, HLATSHWAYO JCC, PATEL JCC, GUVAVA JCC, MAVANGIRA JCC and BHUNU JCC

It is common cause that after a Constitutional Bill is passed by the National Assembly the Speaker is required to present a certificate which states that the Bill received the affirmative votes of at least two-thirds of the membership of the House. Section 328(10)(a) of the Constitution provides as follows:“(10) ...

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HH321-17 : NORMAN MAFERERA vs SUSAN JANUARY
Ruled By: MATANDA-MOYO J

The plaintiff instituted eviction proceedings against the defendant before this court. He claimed for the eviction of the defendant from Stand No.936 Glen Norah Township, Harare and holding over damages of $330 per month from the date of summons to date of vacation. The plaintiff also sought an order for costs on a higher scale.

The plaintiff claimed that he is the owner of Stand 936 Glen Norah Township and that the defendant is unlawfully occupying the premises.

The defendant opposed the claim on the basis that she is lawfully occupying the property; it being owned by her late father, Bafion January.

The defendant claimed that the initial transfer of the property to Chabuka was done fraudulently, and, hence, any subsequent transfer should be declared null and void.

She denied that the plaintiff is entitled to any holding over damages.

She prayed that the plaintiff's claim be dismissed with costs.

At the pre-trial conference, the issues referred for trial were as follows;

(a) Whether or not the plaintiff is the lawful owner of Stand No.936 Glen Norah Township, Harare.

(b) Whether or not the plaintiff is entitled to holding over damages, and, if so, the quantum thereof.

The plaintiff led evidence on his own behalf. His evidence was that he bought the property from a Mr Felix Katsvamutima Shamuyarira in 2013 for $20,000. At the time of purchase, the property was in the name of Bafion January. At City of Harare there were documents indicating the property had been sold by Bafion January to Felix Katsvamutima.

This witness was advised that the property had to be transferred from Bafion January to Felix Katsvamutima before any transfer to him could be done. Mr Katsvamutima had the property ceded to him, and, thereafter it was ceded to the plaintiff. The rates and water bills were also changed to reflect the plaintiff's name.

The plaintiff insisted that as the owner of the property he was entitled to vindicate his property from the defendant.

The plaintiff said he wanted holding over damages in the sum of $330 per month from date of summons. He testified that the amount was the average rentals payable by tenants in that area.

Under cross-examination, the plaintiff said Felix Katsvamutima bought the house from Bafion January in 1991.On being asked why he failed to take cession of the house for so long this witness said Felix Katsvamutima informed him that he (Katsvamutima) had lost the documents pertaining to the property.

He also mentioned that Bafion January's two children, who witnessed the sale, did not appear on the house card kept at Council but the defendant's name appeared on the card.

When questioned whether he was aware that he bought property acquired fraudulently, this witness responded that if it were so the defendant would have made a police report.

This witness testified that the purchase price was only released to Mr Katsvamutima after cession had passed.

Felix Elijah Shamuyarira testified that he bought the property in question from Bafiona January in 1991. He explained that he grew up using his mother's surname, Chabuka. He later changed his name to his paternal one. Shamuyarira.

He produced documents to that effect.

When he purchased the house, he explained that Ellen Manyanga (Bafion January's ex-wife) and her brothers were in occupation of the house. They indicated they wanted to buy back the house from him. Ellen Manyanga and Bafion January had divorced when the house was sold to Felix Shamuyarira.

This witness only changed ownership with the Council on 3 October 2013. He explained that the delay in transferring property was due to lost documents. He only recovered the documents in 2012. He admitted that he sold the property to the plaintiff before changing ownership into his name. He testified that the sale was above board. Officials from the City council and he even visited the house and met with the defendant, who did not raise any objections when told that the house had been sold. The defendant even assisted this witness in evicting her uncles from the property. It was only after such eviction that the defendant moved into the property.

Under cross-examination, Felix Elijah Shamuyarira denied that he changed his name in order to steal the house. He insisted he bought the house and later sold it to the plaintiff who is the current owner of the house.

Susan Matanhire testified that she was a neighbour to the late Bafion January. Sometime around 2012 she was told that a letter had been received from Felix Elijah Shamuyarira who wanted to know the persons residing at the property. She sent word to the defendant who was then in the rural areas. The two proceeded to Felix Elijah Shamuyarira's offices. Felix Elijah Shamuyarira offered to assist the defendant to evict her uncles who were residing at the property. Thereafter, he indicated the keys were to be brought to him. This witness testified that after the uncles were evicted the defendant moved in.

Felix Elijah Shamuyarira was not happy with the move.

This witness and the defendant approached Felix Elijah Shamuyarira and requested him to assist in recovering documents from one Rashiwe. Felix Elijah Shamuyarira retrieved the documents. This witness heard from the defendant that the bills were coming in the name of Chabuka. After two months, bills were in the name of the plaintiff.

Under cross-examination, she admitted she would not know whether the property was sold or not as she was only a neighbour.

Winnie Musendekwa testified that the defendant updated her on developments relating to the property. She admitted that the defendant advised her that (she), the defendant, had been called by Felix Elijah Shamuyarira to discuss about the property. The defendant refused to go in the absence of her older siblings. This witness testified that she advised the defendant to check with the City Council on whether the property was sold. The defendant advised her that the file could not be located. This witness said she knew Bafion January divorced his wife and there was a court order which directed that the house was to be sold and money generated from the sale was to be shared between the two. However, she testified that Bafion January's wife was given money to pay off Bafion January.

She had no knowledge of how the house documents ended up with Felix Elijah Shamuyarira.

Under cross-examination, she admitted she was not aware of the house being sold. She admitted the estate was not registered.

The defendant testified that the property in question belongs to her late parents. In 2012 she was shown documents by Felix Elijah Shamuyarira that the property was sold to Chabuka in 1991. She first met Felix Elijah Shamuyarira at his offices in response to a letter he had written enquiring on residents at the property. Felix Elijah Shamuyarira was worried about the ballooned City Council bills. She said it was clear Felix Elijah Shamuyarira was not Chabuka. They discussed and Shamuyarira indicated that he would evict the persons occupying the premises. He stressed, though, that the keys were to be handed to him. Those persons were later evicted and the defendant moved into the house.

In January and February 2013 this witness noticed that Council bills were in the name of Chabuka. In March, the bills were reflecting the plaintiff's name.

Under cross-examination, she insisted that Bafion January could not sell the house without his wife's consent, hence the sale was fraudulent. She agreed that whilst the signature of Bafion January, appearing on the Agreement of Sale, was similar to that on the certificate of occupancy she still believed the agreement was forged. She admitted her parents were divorced then. She also admitted that the house was never part of her father's estate. When her mother passed on the house was also not registered as part of her mother's estate.

Analysis of Evidence

From the evidence led, it is common cause that the late Bafion January and his late wife had divorced – Harare Community Court case No.1098/90 refers.

According to that order, the house was to be sold with Bafion January's late wife getting two thirds from the proceeds.

The late Bafion January indeed sold the house to Mr Felix K Chabuka. The late Bafion January instructed his lawyers, Gutu and Jakachira, to defend any proceedings in relationship to the sale. The late Bafion January wrote a letter to that effect to his then lawyers on 23 April 1991. The lawyers had advised the late Ellen Manyanga, through a letter dated 10 April 1991, to collect her share of the money amounting to $3,333=33.

On 23 April 1991, the late Bafion January was responding to a letter from his lawyers that his late wife had the intention to buy the late Bafion January's share of the property.

This then bolsters the plaintiff's version that the said F.K. Chabuka delayed getting transfer in order to allow the late Bafion January's wife to buy back the property.

No evidence was placed before me, by the defendant, to prove that the late Ellen Manyanga bought back the property.

The defendant suggested that Mr Shamuyarira was not the same F.K Chabuka appearing on the Agreement of Sale. She made bold assertions that the said F.K. Chabuka was deceased. To that end, she suggested Mr Shamuyarira was a fraudster intending on defrauding her of the property.

Mr Shamuyarira, in rebuttal of such evidence, produced his birth certificate which showed that his birth certificate was initially registered with the names Felix Katsvamutima Chabuka. The surname was later altered to Shamuyarira from Chabuka; birth entry HRE6303/68 refers.

I am of the view that Mr Shamuyarira did manage to show that Felix Elijah Katsvamutima Chabuka and Felix Elijah Katsvamutima Shamuyarira is one and the same person.

The defendant's suggestion, that Mr Shamuyarira was not the same Chabuka who bought the property, falls away.

Of course, the mere fact that the agreement was concluded in 1991 and transfer only taken in 2013, some twenty two years later, required some explanation.

Mr Shamuyarira explained that, initially, he could not take title to the property as the late Bafion January's wife had wanted to buy back the property.

As I observed above, that has been corroborated by letters produced to that effect from the late Bafion January's lawyers. I have no reason to disbelieve that.

Mr Shamuyarira also explained that the documents were lost as their offices were burnt and they had to move offices. He stumbled upon the documents later.

The Agreement of Sale was produced before the court.

I took note that the signature appearing on the agreement resemble that of the late Bafion January. In any case, no plausible evidence was produced to show that the agreement was forged.

The suggestion was simply an attempt by the defendant to hold on to a property she knew was sold.

I do not, therefore, agree with the defence by the defendant that the property belongs to her late parents.

The evidence before me shows that the defendant's late father sold the house to F.K. Shamuyarira (then Chabuka). Evidence also shows that the said F.K. Shamuyarira paid for the property in full. The late Ellen Manyanga's two thirds share of the proceeds was deposited into Gutu and Jakachira lawyers' trust account.

That sale was lawful.

The plaintiff gave his evidence well. His evidence was simple and straight forward.

He testified that he bought the property from F.K Shamuyarira. F.K. Shamuyarira agreed that he sold the property to the plaintiff. Both parties agreed that the purchase price was paid in full. It is also common cause that cession was done to the plaintiff.

The plaintiff is the owner of the property.

On the other hand, the defendant's witnesses were not very useful. Their evidence did not deal with the crux of the matter; that is, that the late Bafion January did not sell the property.

The defendant's first witness admitted she had no knowledge of whether the property was sold or not. Equally, the defendant's second witness's testimony was speculative. She only said if the house was sold she would have known. She never said she had information that the house was not sold.

It also baffles one's mind why the defendant would not have reported to the police if she had evidence of fraud.

The defendant's evidence was also fraught with inconsistencies. For example, when she was called by Felix Elijah Shamuyarira to his office, where she admitted Felix Elijah Shamuyarira was concerned with the ballooned bills from City Council, she failed to explain why Shamuyarira would want to assist her and why he would be concerned with the high bill if he was not the owner. She never alleged she knew Shamuyarira before. She also failed to explain why she was supposed to surrender the keys to Shamuyarira.

The probable conclusion is that the plaintiff's version of events is the correct one.

Felix Elijah Shamuyarira called her to explain that he had bought the property and needed vacant possession of the same. The defendant's conduct, from 2012 to date, is not consistent with that of a person who believed there was a fraud.

From the evidence, I am of the view that the facts are that the property was sold to F.K. Chabuka in 1991 and F.K. Chabuka, now F.K. Shamuyarira, sold the property to the plaintiff.

HH600-14 : DELTA BEVERAGES (PVT) LTD vs FREEDOM CHIMURIWO and CLERK OF THE MAGISTRATES COURT FOR THE PROVINCE OF MASHONALAND IN HARARE N.O. and MESSENGER OF COURT
Ruled By: CHIGUMBA J

This is a matter in which I was called upon to decide whether section 89(6), as read with section 89(1)(d1) of the Labour Act [Chapter 28:01] ousts the review jurisdiction of the High Court over matters that the Labour Court has exclusive jurisdiction over.

The question for determination is whether the High Court has jurisdiction to entertain an application for review of a labour matter at first instance.

It appears to me, that, by its very nature, the Labour Court is frequently seized with matters whose conduct evokes the biblical David and Goliath pathos. David, being the employee litigants that appear before it, and, Goliath, being represented by the more powerful employer. It is important that labour practitioners pay heed to the need to protect and promote the powers and remedies provided by the Labour Act. This involves becoming intimately acquainted with these provisions, and utilizing them as frequently as possible, in order to streamline them and to provide room for their improvement.

Labour practitioners should not lose sight of the fact that the cost of litigation is cheaper in the Labour Court. Surely, this assists our biblical David in his puny attempts to make Goliath pay what is due and owing to him on termination of employment.

This court should be loathe to collude with and to assist Goliath to bully David into submission, into giving up the enforcement of his rights, simply because Goliath has the financial wherewithal, a bottomless pit, that enables him to go forum shopping, to hop from one court to the next, looking for a suitable remedy with which to hit David on the head with, knock him out, and delay, or avoid, paying what is due at any cost.

Time has come for labour practitioners to recognize that, as officers of the court, they must show respect to the Labour Court and not run to the High Court at the drop of a hat because it is perceived as being more expeditious in disposing of these matters, or because they are more familiar with its rules and procedures.

This matter came to me via the Urgent Chamber Book.

After perusing the application and the opposing papers filed of record, I formed the preliminary view that the applicant had not exhausted domestic remedies, and that the High Court should decline jurisdiction.

I invited the parties to attend on me in Chambers, and to address me solely on that point.

I was not persuaded to change my preliminary view.

I dismissed the application with costs for lack of jurisdiction.

The applicants have now written to me and asked me to provide my reasons for holding such a view.

These are the reasons.

In this urgent chamber application for stay of execution, the applicant sought the following relief:

“INTERIM RELIEF GRANTED

Pending the return date, it is ordered;

1. That execution of the warrant of execution issued under MC16865/14 be and is hereby suspended pending the return date.

2. That the third respondent or any of his officers shall not attach and remove from the applicant's premises any of the applicant's movable or other property.

3. Costs shall be determined on the return date.

TERMS OF FINAL ORDER SOUGHT

That on the return date the respondent show cause why a final order should not be made on the following terms;

1. The application for review is hereby granted.

2. The warrant of execution issued on 31 July 2014, under case number MC16865/14, be and is hereby set aside.

3. The applicant shall be entitled to deduct Income Tax per the Income tax Act [Cap 28:06] on the amounts due to the first respondent in terms of the Arbitral Award of 18 July 2014.

4. The first respondent's legal practitioner, Mr. Lawman Chimuriwo, shall bear the costs of these proceedings de boniis propis.”

The grounds supporting this application were that, the first respondent had instructed the third respondent to attach, remove, and sell the applicant's movable property acting under an “irregularly” issued warrant of execution, and that the judgment debt had been paid in full and that there was no need to proceed with execution.

The certificate of urgency was authored by Johhannes Muchada, a legal practitioner with Messrs Dube, Manikai & Hwacha, the applicant's legal practitioners of record.

Mr. Muchada certified that the application was urgent because the first respondent had acted improperly in instructing the third respondent to attach and remove the applicant's property on the basis of an irregular warrant of execution; the charge being that the warrant of execution was issued without registration of the arbitral award.

Mr. Muchada also certified that the matter was urgent because property had been attached on 17 September and removal was due on the 18th of September 2014.

It was also averred that if the applicant was not heard quickly it would suffer irreparable harm as the attached property would be sold in satisfaction of an irregular warrant.

Attached to the papers filed of record was a court application for review made in terms of Order 33 Rule 256 of the High Court Rules, 1971.

That application was premised on the averment that, a warrant of execution had been issued out on 31 July 2014, which the applicant became aware of on 22 August 2014. It was alleged that when the warrant of execution against property was issued, there was no judgment which had been obtained against the applicant by the first respondent, in that court, and that the arbitral award had not been registered as an order of the Magistrates Court.

It was contended that the warrant of execution had no legal basis, and was null and void, moreso since the applicant alleged that it had discharged its indebtedness to the first respondent in full.

Mr. James Mashava, in his founding affidavit to the application for review, stated that the applicant was seeking an order to set aside the warrant of execution granted by the second respondent despite the fact that the applicant had discharged the judgment debt in full, and without registration of the arbitral award as an order of that court....,.

The first respondent submitted that the procedure adopted when the warrant of execution had been issued by the Clerk of Court was recommended to him by the Resident Magistrate at Harare Civil Magistrates Court when he sought his advice. He said he was advised that the procedure for registration of an arbitral award was different in the Magistrates Court where it was not necessary that a formal written application for registration be filed, unlike in the High Court....,.

The registration of arbitral awards is provided for by sections 98(14) and 98(15) of the Labour Act [Chapter 28:01] which stipulates that:

“(14) Any party to whom an arbitral award relates may submit for registration the copy of it furnished to him in terms of subsection (13) to the court of any magistrate which would have had jurisdiction to make an order corresponding to the award had the matter been determined by it, or, if the arbitral award exceeds the jurisdiction of any Magistrates Court, the High Court.

(15) Where arbitral award has been registered in terms of subsection (14) it shall have the effect, for purposes of enforcement, of a civil judgment of the appropriate court.”

Section 98(14) of the Labour Act allows registration of an arbitral award, for purposes of enforcement, with any court of competent jurisdiction.

In this case, the arbitral award fell within the monetary jurisdiction of the Magistrates Court, which is currently pegged at USD$10,000.

Section 98(15) of the Labour Act provides that the effect of registration of an arbitral award, in terms of section 98(14), is to turn the arbitral award into a civil judgment of the appropriate court.

My reading of section 98 of the Labour Act is that it accepts that an arbitral award is not a court order for purposes of enforcement....,.

Section 20 of the Magistrates Court Act [Chapter 7:10] provides that:

“20 Writs of execution

When a court gives judgment for the payment of money, the amount shall be recoverable, in case of failure to pay the same forthwith or at the time or times and in the manner ordered by the court, by execution against the movable property, and, if there is not found sufficient movable property to satisfy the judgment, then against the immovable property of the party against whom such judgment has been given.”…,.

It is my considered view that section 98 of the Labour Act is based on the premise that an arbitral award is not an order of court and that it requires registration in a court of competent jurisdiction for purposes of execution.

The purpose of registration is to turn the arbitral award into an order of that court.

Section 20 of the Magistrates Court Act provides that in order for a writ of execution to be issued, there must be a judgment of the Magistrates Court, which is founded in money, on which execution will be based.

The procedure adopted by the Magistrate Court, of merely issuing a writ of execution on the basis of an arbitral award is akin to putting the cart before the horse.

In my view, the issuing of a writ of execution must be preceded by the filing, and determination, of an application for registration of the arbitral award as an order of the Magistrates Court.

Only then, may the arbitral award, now a competent order of the Magistrate's Court, be competently enforced via the auspices of a writ of execution emanation from the Magistrates' Court.

My view is supported by the provisions of the Magistrates Court (Civil) Rules 1980 (Order 26) wherein it is stated that:

“(1) The process for the execution of any judgment for —

(a) The payment of money;

(b)…,.

(c)…,.
shall be by warrant issued and signed by the Clerk of the court and addressed to the Messenger.

(2) Such process may be sued out by any person in whose favor any such judgment has been given if such judgment is not then satisfied, stayed, or suspended.”…,.

My reading of Order 26 Rule (1)(a), as read with Rule (2), is that, before execution of a judgment which sounds in money, and before a warrant of execution is issued by the Clerk of Court, there must be proof that there is a judgment which has not been satisfied, stayed, or suspended.

In this case, there was no registration of the arbitral award into a judgment of the Magistrate's Court (in terms of section 98 of the Labour Act), and, so, there was no basis on which a warrant of execution could have been issued.

HH52-09 : NEIL BRUCE vs ECONET WIRELESS (PVT) LTD and CITY OF HARARE
Ruled By: OMERJEE J

The plaintiff is a private person, residing at Stand 64 of Lot 7A Colne Valley, commonly known as No.5 Wellburn Drive, Ballantyne Park, Harare. The first defendant, is Econet Wireless (Pvt) Ltd, a company duly incorporated in accordance with the laws of Zimbabwe and the second defendant is the authority ...

On 8 January 2008, the plaintiff issued summons and a declaration against both defendants seeking an order -

(a) Declaring the lease agreement entered into, on or about 27 February 2007, between the first and second defendants to be of no force or effect.

(b) Requiring the first defendant, on the basis that its cell phone base station encroaches on his land and constitutes a nuisance, to:

(i) Vacate stand 648 Ballantyne Park.

(ii) Remove its cell phone base station.

(iii) Restore stand 648 to the condition it was in prior to erecting the base station.

ALTERNATIVELY:

Requiring the first and second defendants to comply with the requirements of Part V of the Regional, Town and Country Planning Act [Chapter 29:12] (“the Planning Act”).

(b) Costs of suit.

The facts bringing rise to this suit can conveniently be summarised as follows:

1. Sometime in January 2006, the first defendant approached the second defendant with a view to leasing from the latter, a certain piece of land measuring 140 square metres, known as Stand No.648 Ballantyne Park, Colne Valley, Harare ("the Stand").

2. The first defendant wished to lease the Stand for purposes of erecting and subsequently operating a Cellular Base Station ("Mast") thereon.

3. In compliance with the provisions of section 152(2) of the Urban Councils Act [Chapter 29:15] the second defendant caused to be published notices of its intention to lease the Stand to the first defendant, in both the Business Herald and the Herald newspapers of 13 and 20 October 2006 respectively.

4. The twenty-one day limit for lodging objections, as required by section 152(2)(b), having elapsed without receipt of any objections, the first and second defendants, on or about 27 February 2007, proceeded to conclude a lease agreement pertaining to the Stand.

5. Of significance, clause 5 of the lease agreement stipulated that the Stand was to be used for the installation and operation of a Cellular Base Station.

6. On the basis of this lease agreement, the first defendant commenced to construct or erect a Mast on the Stand.

7. When the plaintiff, whose premises is directly adjacent to the Stand, noticed what was transpiring, he addressed letters of protest, dated 24 April 2007, to, amongst others, the second defendant, and, in particular, for the attention of the Acting Town Planner, a Mr. A. Kasiwamhura. This letter read -

"Re: Cellphone Mast in Ballantyne Park

I note with concern that a cellphone mast is being erected in Ballantyne Park adjacent to my boundary wall. I have not had any notification of this at all and I have checked with the two neighbours directly opposite who say they have not been notified either.

I would like work on this structure stopped with immediate effect as correct procedures have obviously not been followed. This structure also extends within the building line on my boundary wall.

Further to this, there are severe health hazards caused by E.M.R. [electromagnetic radiation] associated with cellphone masts and they should not be erected in such close proximity to residential properties, especially if these house children.

I should be grateful if you would give this matter your urgent attention."

8. Neither defendant was moved by these protestations, as both held the view that adherence to and compliance with all the necessary legal formalities had been met, and, therefore, under the circumstances, halting the erection of the mast was not warranted.

Faced with this scenario, the plaintiff, on 8 June 2007, filed with this court, what he purported to be an urgent chamber application seeking interim relief compelling the removal of the mast and restoration of the Stand to its original condition, by the first defendant.

The matter was placed before my brother HLATSHWAYO J, who, in declining to hear it on an urgent basis, ruled that -

"The matter is not urgent because of the delay in instituting legal proceedings after the encroachment was noticed and because of the final nature of the interim relief sought. The matter should be set down on the normal opposed roll."

This prompted the plaintiff to enrol it on the opposed roll of 31 October 2007 using the same set of papers as originally filed.

In his initial papers, the plaintiff had predicated his case on an alleged non-compliance with the provisions of section 152 of the Urban Councils Act, but, subsequently, in his answering affidavit, he introduced the matter of non-compliance with the requirements of the Regional, Town and Country Planning Act [Chapter 29:12].

My brother, CHITAKUNYE J, who presided over the opposed application, ruled that this latter aspect be "struck out" on the basis that it introduced a new cause of action.

He proceeded to dismiss the application in its original form, on the grounds, inter alia, that, it was incapable of resolving without hearing evidence.

Following this, the plaintiff, on or about 8 January 2008, filed this action predicated on the ground that was earlier struck out, namely, that the defendants had failed to comply with and/or had totally ignored the requirements of the Regional, Town and Country Planning Act [Chapter 29:12].

At a pre-trial conference held on 23 October 2008, the following issues were identified as requiring determination -

1. Was the first defendant required, by the law, to obtain a development permit?

2. Was the plaintiff given the required notice to object to the development?

3. Does the first defendant's Base Station constitute a nuisance?

Prior to the commencement of the trial, the parties agreed that issues 1 and 2 predominately involved questions of law and would not therefore require the adduction of evidence.

In addition, the plaintiff, on his own volition, formally withdrew the third issue.

The result was that the case effectively proceeded on the basis of an opposed application.

On the date of hearing the first and second defendants raised certain points in limine, that, in my view, can more conveniently be dealt with together as opposed to separately.

My understanding of the points raised in limine is as follows -

(a) That this court lacks jurisdiction to hear the matter because section 38 of the Regional, Town and Country Planning Act [Chapter 29:12] stipulates that any person aggrieved by a decision of a local planning authority has one month in which to lodge an appeal with the Administrative Court.

In casu, the plaintiff, apart from instituting proceedings in the wrong fora was also now out of time to appeal against the decision made by the second defendant.

(b) That, even if it were accepted that this court possesses review jurisdiction over decisions made by inferior bodies; in casu, the court is precluded from exercising its review powers by reason of non-compliance with Order 33 of the Rules of Court.

I consider that both points in limine are ill-conceived and without merit.

Firstly, an appeal lies with the Administrative Court, only if the decision being challenged is one which was made or deemed to have been made in terms of the Regional, Town and Country Planning Act [Chapter 29:12]. Put differently, not all challenges against decisions made by a local authority lie with the Administrative Court unless they are made in terms of the Regional, Town and Country Planning Act [Chapter 29:12].

This is made abundantly clear when regard is had to the wording of section 38 of the Regional, Town and Country Planning Act. It reads, in relevant part;

"38(1) Any person -

(a) Who is aggrieved by any decision made or deemed to have been made by a local authority in connection with an application for -

(i) A permit or preliminary planning permission; or

(ii) Any permission required in terms of a development order, building preservation order, or tree preservation order; or

(iii) An extension of time as contemplated in paragraph (d) of subsection (1) of section twenty-two or subparagraph (ii) of paragraph (a) of subsection (2) of section twenty-four, may, within one month from the notification of such decision…, appeal to the Administrative Court…,."

All the matters stated in sub-paragraphs (i) to (iii) above are provided for by the Regional, Town and Country Planning Act [Chapter 29:12] i.e. section 26 provides for a planning permit, section 24 for a development order, sections 30 and 31 for building and tree preservation orders, respectively.

It is not in dispute that what transpired in casu is that the second defendant, by virtue of the powers conferred on it by section 152 of the Urban Councils Act, took a decision to lease the Stand to the first defendant.

It is obvious that this decision was neither made nor can it be deemed to have been made in terms of the Regional, Town and Country Planning Act.

In my understanding, the plaintiff is not complaining against the decision made by the second defendant to grant a lease to the first defendant, but, rather, that after obtaining the lease, the first defendant, in complete disregard of the mandatory requirements of the Regional, Town and Country Planning Act [Chapter 29:12], went ahead to erect or construct a mast on the Stand.

It is in this latter respect that the plaintiff is seeking redress.

Needless to say, this is not the type of complaint contemplated by section 38 of the Regional, Town and Country Planning Act, and, therefore, no appeal can be said to lie with the Administrative Court.

The above also puts paid to the second point in limine in that the plaintiff has not alleged any procedural irregularity in the manner the second defendant arrived at its decision to grant the lease, but simply alleges that, by omission and commission, he has been deprived of his rights through the defendants disregard of the mandatory requirements of the Regional, Town and Country Planning Act [Chapter 29:12].

In the circumstances, it cannot be said that the plaintiff is asking this court to review the decision made by the second defendant.

It must here be remembered that a review pertains to an alleged irregularity or illegality that is said to have occurred or been occasioned during the decision making process of a body inferior to the High Court: section 27 of the High Court Act.

Before dealing with the merits of the case, I wish to make the following observation:

A local authority, such as the City of Harare, is empowered by section 152 of the Urban Councils Act to alienate any land it owns through sell, exchange, lease, donation or otherwise dispose of or permit the use of it. In doing so, the local authority is obliged to comply with the requirements as stipulated in that provision.

In casu, this is exactly what the second defendant did and no criticism can be warranted in that regard.

However, it must be remembered that the fact that a local authority or Council is so empowered should not be construed as exempting it or any other person from complying with the requirements of Part V of the Regional, Town and Country Planning Act [Chapter 29:12].

Thus, where it is intended to develop the land alienated by a local authority, all provisions of Part V aforesaid must be adhered with. This includes applying for a planning permit in terms of section 26 of the Regional, Town and Country Planning Act [Chapter 29:12].

I now turn to determine the case on the merits.

The first issue for determination is whether the first defendant was, by law, required to obtain permission to erect or construct the mast?

The resolution of this issue depends on whether the erection or construction of the mast constitutes development as defined by the Regional, Town and Country Planning Act.

Part V thereof provides for the control of development of land and buildings and section 22 defines what is meant by the term "development".

In terms of subsection 1(a) thereof, the carrying out, on land, of any building constitutes development, and, in terms of sub-section 1(b), the altering of the character of the use of any land also constitutes development.

The facts in casu show that the first defendant erected a cellular base station or mast on the Stand.

To my mind, a structure such as this falls within the definition of a building as provided for by the Regional, Town and Country Planning Act. In this regard, section 2 thereof defines "building" as including 'any structure or erection or part thereof, including a swimming pool'.

It thus follows that, by virtue of subparagraph (a) of subsection. (1) of section 22 of the Regional, Town and Country Planning Act the construction of the mast constituted development and was therefore subject to the requirements of Part V of the Regional, Town and Country Planning Act.

Additionally, and, in any event, the facts, as can be gleaned from the papers, reveal that the Stand, measuring 140 square metres, is part of a piece of land that is designated for use as a recreational park.

As already alluded to, section 22(1)(b) of the Regional, Town and Country Planning Act stipulates that the altering of the character of the use of land constitutes development within the meaning of that term in the Regional, Town and Country Planning Act, save if the new use and the old use both fall within the same prescribed group of land uses (sub-paragraph (b)(i)).

The erection or construction of a cellular mast on land designated for use as a recreational park can hardly be described as simply change of use falling within the same prescribed group of uses of land. It is more than that. It amounts to the altering of the character of the use of land and therefore is development as defined by the Regional, Town and Country Planning Act: see, generally, Mutare City Council v Wildlife Society of Zimbabwe 2001 (2) ZLR 275 (S).

What this means is that, in casu, the first defendant was required, by law, to obtain a planning permit in terms of section 26 of the Regional, Town and Country Planning Act.

Section 24 thereof proscribes the carrying out of any development unless permitted in terms of a development order or in accordance with a permit issued in terms of section 26.

I therefore find that the erection of the cellular mast on the Stand was not carried out in terms of any development order nor was it done in accordance with a permit issued in terms of section 26 of the Regional, Town and Country Planning Act.

It follows that the cellular mast erected by the first defendant on the Stand is an illegal structure and ought not to have been erected without first obtaining a development order or planning permit.

From the foregoing, it is obvious that the second triable issue, as identified at the pre-trial conference, must be answered in the negative.

This is so because on receipt of an application for a planning permit, section 26(3) of the Regional, Town and Country Planning Act obliges the local planning authority to require the applicant to give public notice of his application and to serve notice of the application on every owner of property adjacent to the land to which the application relates.

None of this was done.

The appropriate remedy

The plaintiff seeks, as the main remedy, the removal of the mast and restoration of the Stand to its original condition before the impugned development took place.

In my view, such an order is, at this stage, both incompetent and pre-mature. This is so because section 27 of the Regional, Town and Country Planning Act permits for an application to be made to regularise any development that has been carried out without the requisite development order. It reads -

"27 Regularisation of buildings, uses or operations

Where any development has been carried out in contravention of section twenty-four an application may be made in terms of section twenty-six in respect of that development and the local planning authority shall deal with that application in terms of that section but any permit granted thereunder shall take effect from the date on which the buildings were constructed, the operations were carried out, or the use was instituted, as the case may be."

The first defendant, therefore, has open to it recourse to this provision. It is for this reason that, although finding in favour of the plaintiff, I decline to issue the main order sought, but, instead, will issue the alternative order prayed for.

In the result, the application succeeds and it is ordered as follows -

1. That the first and second defendants comply with the requirements of Part V of the Regional, Town and Country Planning Act [Chapter 29:12].

2. That the first and second defendant jointly and severally, the one paying the other to be absolved, shall pay the costs of suit.

SC39-00 : E. FILON vs THE PUBLIC SERVICE COMMISSION and THE MINISTER OF LANDS AND WATER RESOURCES
Ruled By: GUBBAY CJ, McNALLY JA and EBRAHIM JA

The appellant was discharged from the Public Service. He had been suspended from duty by the Secretary to his Minister, and, later, served with charges to which were attached certain documents. The letter containing the charges was signed by a Mr Moyo on behalf of the Secretary to the Ministry.

The appellant duly replied, in writing, to the allegations. He required other documents.

He was not supplied with copies of those documents, nor were his legal practitioners, who also demanded copies of them. He was, however, allowed access to them and to make notes.

The Public Service Commission (“the Commission”) held its enquiry, and, as a result, the appellant was found guilty of misconduct and discharged.

He took the matter on review; the sole point of review being, that, the audi alteram partem rule had been breached because of the respondent's failure to supply the requested documents.

The learned judge a quo rejected that argument.

He was right to do so.

The appellant had access to all the relevant documents. He was supplied with some documents along with the charges, and was given access to the others. His legal practitioner had the opportunity to examine the documents, though it is not clear whether he did so. He replied to the charges, in writing, at some length.

In general, on the audi alteram partem rule and its applicability to proceedings under Public Service disciplinary regulations, see Jiah & Ors v Public Service Commission & Anor 1999 (1) ZLR 17 (S); Chitzanga v Public Service Commission HH28-00.

This was not a case like Binza v Acting Director of Works 1998 (2) ZLR 364 (H), where the employee and the court were denied access to the relevant documents.

Before this Court, the appellant took a different line. He raised several new points for the first time.

As he correctly stated, points of law can be raised for the first time on appeal.

In addition, the appellant is a self-actor, and the courts, within limits, always give the greatest latitude to self actors.

The appellant argued that the disciplinary proceedings were void ab initio on several grounds –

(1) The suspension was defective;

(2) Even if the suspension was valid, it lapsed automatically after three months, as the charges did not involve financial prejudice to the State;

(3) The charges were invalid, having been preferred by someone other than his head of office, head of department, head of ministry, or the Commission itself;...,.

The respondents argue, in respect of point (3), that as section 28 of the Public Service Regulations permits the delegation of disciplinary functions to any person, it must be presumed that Mr Moyo had been duly authorised by the Secretary to sign on his behalf.

As in Marumahoko v Chairman, Public Service Commission & Anor 1991 (1) ZLR 27 (H)…, there is nothing specific to show that the Secretary had authorised Mr Moyo to sign on his behalf.

The maxim omnia praesumuntur rite esse acta should not override the requirements of the Public Service Regulations.

It is likely that Mr Moyo was authorised, but, there is no specific evidence that he was.

However, it should be noted that the letter containing the charges was written “further to” the letter of suspension, which, itself, clearly adumbrated charges being brought. It is also relevant that section 28(2) of the Public Service Regulations states that the Commission may depart from or authorise any departure from the Regulations, or condone any irregularity or departure from any provision of the Public Service Regulations where the irregularity or departure has not resulted, or will not result, in a substantial miscarriage of justice.

It is not clear whether the Commission has formally condoned the irregularity, if indeed it was an irregularity. But, in the circumstances, the irregularity was, in my view, not such as to invalidate the proceedings, being one of the most technical kind and of no real significance.

HH02-10 : JOHN RODGER & OTHERS vs FRIK MULLER & OTHERS
Ruled By: PATEL J

The first and second applicants are directors of the third applicant, which operates safari activities in the Zambezi Valley Area.The first and second respondents are directors of the third respondent, which is also a safari operator.The fourth respondent is the National Parks and Wildlife Management Authority (the Authority) responsible for ...

The first and second applicants are directors of the third applicant, which operates safari activities in the Zambezi Valley Area.

The first and second respondents are directors of the third respondent, which is also a safari operator.

The fourth respondent is the National Parks and Wildlife Management Authority (the Authority) responsible for managing all safari operations in Zimbabwe.

Background

The applicants were granted two written concessions to operate hunting safaris in the Rifa Safari Area for a period of 10 years expiring on the 31st of December 2007.

Before this date, on the 18th of October 2007, the National Parks and Wildlife Management Authority (the Authority) conducted an auction for a new 5 year concession in respect of the applicants' concession area. At that auction, the applicants were prevented from bidding for the concession because they had failed to furnish the requisite Bank guarantee.

According to the first applicant, he then approached the first respondent who undertook to bid on behalf of the applicants after exhausting the respondents' own bidding limit.

The first respondent won the final bid for the sum of $750 billion.

The first applicant then thanked him and was congratulated by all present for having retained the concession.

Subsequently, on the 20th of October 2007, the respondents reneged on their arrangement and sought to retain the concession for themselves.

The respondents deny the applicants averments.

They contend, that, all bidders at the auction were fully aware of the Bank guarantee stipulation, as was clearly stated in the National Parks and Wildlife Management Authority's prospectus, and that there was no arrangement between the parties prior to the auction.

They did, subsequently, discuss the possibility of sub-letting part of the concession area to the applicants but nothing concrete materialised thereafter.

They further aver, that, if their Concession Agreement with the National Parks and Wildlife Management Authority (the Authority) were to be cancelled, they would suffer irreparable harm.

The National Parks and Wildlife Management Authority (the Authority) avers, that, the application is fatally defective in that it does not cite the Minister of Environment and Tourism (the Minister) as required by the Parks and Wildlife Act [Chapter 20:14].

Moreover, the Parks and Wildlife Act stipulates a maximum period of 10 years for hunting concessions and, therefore, the applicants cannot be granted any further extension.

On the 19th of February 2008, the applicants filed an urgent application to assert their rights, and, on the 22nd of February, they were granted a Provisional Order interdicting the respondents from evicting the applicants from the Rifa Safari Area and from interfering with the applicants' operations in that area.

They now seek a Final Order confirming the above relief, and, further interdicting the respondents from exercising any rights in the applicants' concession area pending the determination of Case No. HC891/08.

In that case, the applicants seek the setting aside of the written concession granted by the National Parks and Wildlife Management Authority (the Authority) to the respondents in November 2007. The Concession Agreement was signed by the Minister on the 10th of January 2008...,.

The issues for determination herein, as I perceive them, and as concurred by counsel, are as follows:

1....,.

2....,.

3. Whether there was a clear agreement between the applicants and the respondents whereby the first respondent was to bid on behalf of the applicants at the auction.

4. Whether the agreement between the applicants and the respondents, if any, was legally binding and enforceable as against the National Parks and Wildlife Management Authority (the Authority).

5. Whether the balance of convenience favours the grant or refusal of the relief sought by the applicants....,.

Agency Agreement between the Parties

The affidavit evidence filed by the parties is markedly conflicting as to what precisely transpired during the bidding process at the auction held in October 2007.

Nevertheless, the applicants' version of events is strongly supported by the affidavits deposed to by several independent individuals who were present on the day.

These corroborating affidavits (by Messrs. Evans, Jolliffe, Fundira, Townsend, Dziya and Duckworth) confirm, firstly, that, the first applicant and the first respondent had concluded some arrangement for the latter to bid on behalf of the former, and, secondly, that the first applicant was congratulated by those present for having retained his concession.

Having regard to the foregoing evidence, the applicants' version in this respect is more credible than that of the respondents.

Accordingly, on a balance of probabilities, it is reasonably clear, that, there was an agreement between the parties the effect of which was that the first respondent would act as agent for the applicants in the bidding process at the auction.

Whether Agreement Legally Binding and Enforceable

In terms of the prospectus governing the auction conducted in October 2007, the conditions for participation which are presently pertinent were as follows:

(i) Firstly, only citizens or representatives of wholly owned Zimbabwean companies with no relevant criminal records would be permitted to bid.

(ii) Secondly, all current hunting concession holders “with the exception of the current concession lessee” (viz. the first applicant) were not allowed to participate.

(iii) Thirdly, bidders were required to submit proof of funds by way of a Bank guarantee to be furnished to the National Parks and Wildlife Management Authority (the Authority) two hours before the auction; prospective bidders who failed to do so would not be allowed to bid.

(iv) Fourthly, the National Parks and Wildlife Management Authority (the Authority) reserved to itself the right to vet all bidders.

It is also necessary to consider the concession conditions of sale set out in the prospectus. These conditions directed all participants to obtain auction participation forms on payment of the prescribed fee and to pay a refundable participation deposit of $20 million. At the conclusion of the auction “the highest accepted bidder will be declared the purchaser, subject to the reserve price [and] further vetting” and immediate payment of a surety deposit of $5 billion followed by payment for the concession itself within 14 days.

Although the registration status of the third applicant was questioned by counsel for the first, second, and third respondents by dint of a typographical error in the founding affidavit, I am satisfied that the third applicant is not a South African entity but a company registered in terms of the laws of Zimbabwe.

What is more relevant in casu is the applicants' contention that they were assured by the National Parks and Wildlife Management Authority (the Authority) that they would not be required to provide any Bank guarantee in order to be able to bid at the auction.

Apart from this bald assertion, there is no documentation to support this contention.

Moreover, the above-cited conditions for participation make it clear that all prospective bidders, including the first applicant qua current concession holder, were obliged to provide the requisite Bank guarantee, failing which they would not be allowed to bid at the auction.

Equally significantly, the applicants have proffered no evidence whatsoever that they paid the stipulated auction participation deposit.

Notwithstanding these deficiencies, counsel for the applicants submits, that, the first respondent was duly qualified to bid not only for himself but also as agent for the first applicant.

Since there was nothing to prevent the first respondent from bidding or participating as an agent, it is his status rather than that of the first applicant which must be considered for present purposes.

As already indicated, the National Parks and Wildlife Management Authority (the Authority) reserved the right to vet all bidders before the auction in order to ensure, inter alia, that they were citizens or representatives of local companies and that they had no criminal record for any of the offences specified.

More importantly, at the end of the auction, even the successful bidder was subject to further vetting to ascertain his suitability as a hunting concession holder before the concession could be granted.

These vetting requirements clearly demonstrate, that, the identity and attributes not only of the winning bidder but also of the grantee are crucial to the selection of the concession holder.

The appointment of an agent to bid on behalf of the prospective grantee would clearly subvert and negate the vetting and selection process since it is the agent, rather than his principal, who would have been subjected to full scrutiny. Although the bidding agent might be a local citizen and otherwise suitably qualified, his principal might well be a foreigner or even a convicted fraudster or perpetrator of parks and wildlife offences.

I am fortified in this view by having regard to the terms and conditions incorporated in the concession agreements in casu.

Clause 23 of the first applicant's expired Concession Agreement is virtually identical to clause 23 of the third respondent's current agreement. This latter clause recognises that “the right to operate on the Concession has been given to the right holder and to no other person solely in consideration of the right holder's successful bid of the right to hunt.” It then stipulates, that, in the case of a corporate right holder, no shares may be issued or transferred and no new director may be appointed without the National Parks and Wildlife Management Authority's prior written approval. Additionally, the clause prohibits, in absolute terms, any cession or assignment of any right or obligation under the agreement or of the right holder's annual quota of animals. It also prohibits any sublease or sub-occupation or any hypothecation or encumbrance of the concession without the prior written consent of the National Parks and Wildlife Management Authority (the Authority).

All of this re-affirms the critical significance of the grantee's identity and the fact, that, the rights conferred and obligations imposed under the concession are personal and peculiar to the grantee.

Taking all of the foregoing into account, I am of the firm opinion that any agency agreement of the nature presently under review would operate to circumvent the National Parks and Wildlife Management Authority's vetting requirements and the clear objective behind those requirements.

Any such arrangement, even if it were not contrived as a deliberate subterfuge, cannot be utilised to dilute the obvious privity of contract envisaged between the successful bidder-cum-grantee, on the one hand, and the Minister and the National Parks and Wildlife Management Authority (the Authority) on the other.

It follows, that, the agency agreement in casu, whatever its legal implications and consequences as between the applicants and the respondents, is not legally binding on the National Parks and Wildlife Management Authority (the Authority) and cannot be enforced as against it.

It also follows, that, the applicants have failed to establish the infraction of any clear right entitling them to the interdictory relief that they seek.

Balance of Convenience

The above conclusion renders it unnecessary for me to consider the final issue relating to the balance of convenience as between the parties. However, for the sake of completeness, I deem it appropriate to dispose of this aspect as well.

As regards the applicants, the withdrawal of the hunting concession has obviously entailed the loss of profit and will necessitate the removal of their assets from the concession area. However, their losses are not irreparable and could be redressed by a claim for damages in respect of lost profits and future hunting rights.

Moreover, in terms of clause 14 of the first applicant's Concession Agreement, he was given ample time to remove his improvements and is entitled to compensation from the National Parks and Wildlife Management Authority (the Authority) in respect of those improvements that are retained in situ by agreement.

Insofar as concerns the respondents, almost two years have elapsed since the third respondent was granted its hunting concession. If this subsisting Concession Agreement were to be cancelled or temporarily suspended, the respondents would incur huge losses in terms of moneys already expended on the auction and concession area and the withdrawal of firm contracts with foreign clients amounting to US$350,000.

Moreover, the practical effect of the final order sought by the applicants would be to suspend all operations in the concession area until the action in Case No. HC891/08 is finalised.

As is apparent from questions put to counsel, the time frame for the final determination of that matter is presently uncertain.

As for the National Parks and Wildlife Management Authority (the Authority), the suspension of hunting operations in the Rifa Safari Area will result in the substantial loss of revenue by way of hunting fees payable under the subsisting Concession Agreement. Any such suspension will also involve a diminution in other income generated from foreign and local tourists within the concession area.

All in all, I am abundantly satisfied that the balance of convenience does not favour the applicants. The granting of the relief sought in this matter would cause greater harm and inconvenience to the respondents and the National Parks and Wildlife Management Authority (the Authority) than the harm and inconvenience that the refusal of that relief would cause to the applicants.

Disposition

I have found that there was an agreement between the applicants and the respondents whereby the first respondent was to bid as agent for the applicants at the auction conducted on behalf of the National Parks and Wildlife Management Authority (the Authority) in October 2007. However, in my view, this agreement is not legally binding and enforceable as against the National Parks and Wildlife Management Authority (the Authority) and the applicants have therefore failed to establish any clear right apropos the relief that they seek.

In any event, even if it were to be shown that some right of the applicants has been infringed, the balance of convenience clearly favours the refusal of the order sought by the applicants.

In the result, the application is dismissed with costs.

HH113-09 : DIDYMUS MUTASA vs NGONI NDUNA N.O. and ATTORNEY-GENERAL and COMMISSIONER-GENERAL OF POLICE and ROBERT MCKERSIE
Ruled By: PATEL J

The applicant herein is the Minister of State responsible for Presidential Affairs. He was formerly the Minister responsible for Land Reform and Resettlement. The applicant originally sought an order, inter alia, staying and eventually setting aside the execution of a warrant of arrest issued against him on the 6th of ...

The warrant of arrest was then cancelled on the 9th of October, on the very day that this application was filed, and is no longer of any concern.

Nevertheless, the applicant still seeks an interim order barring the first respondent, who was the presiding magistrate in a criminal matter before the Chinhoyi Magistrates Court, from compelling him to testify in that matter. He also seeks a final order setting aside the subpoena issued on the 2nd of October 2009 for him to attend and testify in the criminal matter.

The latter involves the prosecution of the fourth respondent under the Gazetted Lands (Consequential Provisions) Act [Chapter 20:28] and has been set down to resume on the 4th of November 2009.

Objections in Limine

Counsel for the fourth respondent has raised several objections in limine:

(i) Firstly, that the applicant's plea on the merits is one of State privilege, and, as such, it must be raised by way of a sworn affidavit from the head of the Ministry concerned, viz. the Ministry responsible for land resettlement, and not by the applicant himself;

(ii) Secondly, that the applicant's founding affidavit, and his lawyer's supporting affidavit, must both be disregarded as the former contains no substantive averments and the latter cannot be used in support of an affidavit that avers nothing of substance.

As regards the first objection, counsel relies on FELTOE: A Guide to Administrative and Local Government Law in Zimbabwe (2006)…,.

While I have no doubt that the learned author is correct in his general statement of the procedure to be applied, I am not persuaded that his proposition necessarily and invariably applies to every claim of privilege by a witness in terms of section 295 of the Criminal Procedure and Evidence Act [Chapter 9:07], viz. on the grounds of public policy and/or public interest.

In my view, the form in which the privilege is claimed would depend upon the nature of the evidence in question and the context in which the evidence is called for.

In the instant case, it seems to me that the privilege has been appropriately raised through the supporting affidavit of the applicant's lawyer. Accordingly, the fourth respondent's objection in this regard cannot be sustained.

Turning to the second objection, it appears that the deponent to the supporting affidavit, Itayi Ndudzo, personally attended the Magistrates Court on the 6th of October 2009 and had personal knowledge of the relevant proceedings and the record thereof.

As is correctly conceded by the fourth respondent's counsel, a legal practitioner can depose to issues of procedure and issues of fact that only he and not the client can depose to.

The applicant himself had no knowledge of what transpired at the Magistrates Court, except by way of hearsay, and properly associates himself with the averments contained in Itayi Ndudzo's affidavit on the basis that the latter was fully seized with the matter and in attendance at the court at the relevant time.

It follows that the preliminary objection on this point must also fail.

Basis of Application

The present application is by way of criminal review in terms of section 29 of the High Court Act [Chapter 7:06].

It was raised, in the course of argument, by counsel, that, the application is formally defective in that it has not been brought as a court application pursuant to Rule 256 of the High Court Rules, 1971 and that the review jurisdiction of this Court must be exercised with the concurrence of another judge.

As regards the first point, I take the view that Rule 256 is confined to civil matters and proceedings and does not apply to criminal reviews. In any event, it seems unnecessary for me to decide the point for present purposes, as I am inclined to entertain this matter on the robust approach adopted in State v Strowitzki 1995 (2) SA 525…, to wit:

“It is not the form of the procedure used which matters so much as the nature and substance of the application itself.”

As for the second point, the final order sought by the applicant requires the setting aside of the subpoena issued by the Magistrates Court.

This clearly falls within the purview of subparagraph (ii) of section 29(2)(b) of the High Court Act and would require the concurrence of another judge by virtue of the peremptory proviso to section 29(5)(b): see Attorney-General v Makamba 2004 (2) ZLR 63 (S)…,.

On the other hand, the interim relief sought herein is to bar the first respondent from compelling the applicant to testify pending the granting of the final order.

This relief, in my view, lies within the ambit of the general powers conferred by subparagraph (vi) of section 29(2)(b) and can be granted by a single judge in terms of section 29(5)(b) of the High Court Act.

Propriety of Application

Section 229 of the Criminal Procedure and Evidence Act [Chapter 9:07] regulates the process for securing the attendance of witnesses as follows:

“(1) In this section —

'prescribed officer' means the registrar, assistant registrar or clerk of the court or any officer prescribed by rules of court.

(2) Either party desiring to compel the attendance of any person to give evidence or to produce any books, papers or documents in any criminal case may take out of the office prescribed by rules of court the process of the court for that purpose.

(3) When the accused desires to have any witnesses subpoenaed and satisfies the prescribed officer of the court that —

(a) He is unable to pay the necessary costs and fees; and

(b) Such witnesses are necessary and material for his defence; the prescribed officer of the court shall subpoena such witnesses.

(4) In any case, where the prescribed officer of the court is not so satisfied, he shall, upon the request of the accused, refer the application to the judge or magistrate who may grant or refuse such application or may defer giving his decision until he has heard the other evidence in the case or any part thereof.”

It is averred, on behalf of the applicant, that, the subpoena that is impugned in casu was issued as an order of court and not merely through the office of the clerk of court. Accordingly, the first respondent was functus officio vis-à-vis the subpoena and his decision in that regard is properly reviewable by this Court.

In his affidavit, filed at the direction of the Court, the first respondent affirms that the subpoena was originally issued by the Clerk of Court at the request of the fourth respondent. Subsequently, following the reluctance of the police to serve the subpoena, the first respondent directed that the subpoena be “reissued to the police to serve the witnesses for the defence today.”

The first respondent's position is that, in essence, he merely ordered the police to serve the subpoena originally issued by the Clerk of Court.

Assuming that this evidence accurately reflects what transpired in the issuance and re-issuance of the subpoena, the subpoena was issued, not by the first respondent but by the Clerk of Court acting in terms of subsections (2) and (3) of section 229 of the of the Criminal Procedure and Evidence Act.

It follows that the validity of the subpoena, on its merits, was never canvassed before the first respondent and, therefore, he cannot be said to be functus officio in that regard.

Ordinarily, the applicant's claims of privilege and the validity or otherwise of the subpoena should, in the first instance, be ventilated before the Magistrates Court. Nevertheless, on the basis that the subpoena was originally issued by an officer of the court and subsequently reissued by order of the court, it may properly be regarded as an order of the court itself.

Moreover, whether the subpoena is regarded as an administrative order issued by the clerk or as an order of the court, this Court is endowed with the requisite jurisdiction in either case, by virtue of its inherent jurisdiction at common law as well as its statutory jurisdiction under section 26 of the High Court Act, “to review all proceedings and decisions of all inferior courts of justice, tribunals and administrative authorities within Zimbabwe.”

I therefore deem it perfectly appropriate to deal with the merits of this application in order to avoid further delays in the administration of justice.

Merits of Application

According to the fourth respondent, the evidence of the applicant is necessary for the purposes of his defence in his prosecution before the Magistrates Court under section 3 of the Gazetted Lands Act.

His defence, in essence, is that he was given an “offer letter” by the applicant which constitutes the requisite “lawful authority” entitling him to remain in occupation of the farm without contravening section 3 of the Gazetted Lands Act. His evidence is that this offer letter was returned to the applicant in order to correct a spelling error in his name and that the letter was then never handed back to him. He now wants the applicant to testify on his behalf by confirming that the offer letter was in fact originally issued to him.

The applicant challenges the propriety of his testimony on several grounds:

In particular, he relies on the grounds of inadmissibility of evidence and non-compellability of witnesses as set out in sections 252, 295 and 297 of the Criminal Procedure and Evidence Act [Chapter 9:07]. These sections provide as follows:

“252. No evidence as to any fact, matter, or thing shall be admissible which is irrelevant or immaterial and cannot conduce to prove or disprove any point or fact at issue in the case which is being tried.”

“295. No witness shall, except as in this Act is provided, be compellable or permitted to give evidence in any criminal proceedings as to any fact, matter or thing, or as to any communication made to or by such witness, as to which, if the case were depending in the Supreme Court of Judicature in England, such witness would not be compellable or permitted to give evidence by reason that such fact, matter or thing or communication, on grounds of public policy and from regard to public interest, ought not to be disclosed and is privileged from disclosure: Provided that…,.”

“297. No witness in any criminal proceedings shall, except as provided by this Act or any other enactment, be compelled to answer any question which, if he were under examination in any similar case depending in the Supreme Court of Judicature in England, he would not be compelled to answer by reason that his answer might have a tendency to expose him to any pains, penalty, punishment or forfeiture or to a criminal charge or to degrade his character: Provided that…,.”

The applicant's reasons for not testifying in the fourth respondent's criminal trial are threefold:

(i) Firstly, that the evidence sought does not constitute a valid defence to the charge and is therefore irrelevant and inadmissible;

(ii) Secondly, that he cannot be compelled to divulge matters involving land allocation as these are privileged by dint of public policy and public interest; and

(iii) Thirdly, that he is only being called as a witness in order to degrade his character and he cannot be compelled to do so.

By virtue of section 3(1) of the Gazetted Lands Act, “no person may hold, use or occupy Gazetted land without lawful authority.”

The term “lawful authority” is defined in section 2(1) of the Gazetted Lands Act to mean;

“(a) An offer letter; or

(b) A permit; or

(c) A land settlement lease” and “offer letter” means “a letter issued by the acquiring authority to any person that offers to allocate to that person any Gazetted land, or a portion of Gazetted land, described in that letter.”

As recent case authority demonstrates, mere verbal authority to occupy Gazetted Land or a general policy statement to that effect does not satisfy the requirement of lawful authority for the purposes of section 3 of the Gazetted Lands Act: see Chirikure & Others v Kenmast Farming (Pvt) Ltd & Others HH106-05; Chimuka & Others v Minister of Lands & Others HC4837/07.

The accused occupier must provide proof of a valid offer letter, permit, or land settlement lease.

Generally speaking, the mere production of an offer letter would, unless the origin or authenticity of the letter is questioned, avail as a complete defence to a charge of contravening section 3 of the Gazetted Lands Act.

However, where the offer letter in question is lost or destroyed, the evidence of the issuing authority or other public official may be necessary in order to establish that the letter was in fact issued to the occupier concerned at the relevant time. Such evidence would undoubtedly constitute the requisite lawful authority and a valid defence against a charge of contravening section 3 of the Gazetted Lands Act.

Having regard to the foregoing, I am satisfied that the testimony required from the applicant, as to whether he did or did not issue an offer letter to the fourth respondent in relation to the land in question, is highly relevant and clearly admissible for the purposes of the fourth respondent's acquittal or conviction under section 3 of the Gazetted Lands Act.

Moreover, given that such evidence is to be elicited from the applicant in relation to what he himself did or did not do vis-à-vis the fourth respondent as the authority responsible for issuing offer letters, there can be no question of him having to divulge any official secret or other confidential information inimical to public policy or the public interest.

I am therefore quite unable to perceive any logical basis for the privilege claimed by the applicant on the facts of this case.

As for the possible degradation of his character, there is nothing meaningful in the founding papers to substantiate the apprehended attack on his character. Ultimately, any such apprehension must be weighed against the constitutional right of every accused person to be afforded a fair criminal trial as enjoined and guaranteed by section 18(3) of the Constitution, and, in particular, the right “to obtain the attendance and carry out the examination of witnesses to testify on his behalf.”

It follows that the applicant has failed to establish any basis for justifying the interim relief that he seeks. Accordingly, this Court cannot interfere with the subpoena issued by the Chinhoyi Magistrates Court by barring the first respondent, or any other magistrate, from compelling the applicant to testify at the fourth respondent's criminal trial.

As regards costs, the applicant's counsel conceded, at the hearing of this matter, that the first respondent should not have been cited in his personal capacity and that he was entitled to his wasted costs, including the costs of appearance by counsel.

It is accordingly ordered that the applicant shall pay the first respondent's costs on a legal practitioner and client scale.

As for the other respondents, although the applicant has failed on the merits of his application, I am not persuaded that his approach to this Court was so unjustified or unnecessary as to warrant a punitive award of costs.

The second, third, and fourth respondents are therefore only entitled to their costs on the ordinary scale.

In the result, this application is dismissed with costs as aforesaid.

SC03-21 : AFRITRADE INTERNATIONAL LIMITED vs ZIMBABWE REVENUE AUTHORITY
Ruled By: PATEL JA, BHUNU JA and BERE JA

This is an appeal against the judgment of the Fiscal Appeal Court dismissing an appeal against the determination of the respondent requiring the appellant to pay value added tax (VAT) on the importation of certain goods into Zimbabwe.BackgroundThe appellant is a foreign company incorporated in the British Virgin Islands and ...

Background

The appellant is a foreign company incorporated in the British Virgin Islands and operating from Guernsey in the Channel Islands. The respondent is a body corporate responsible for the collection of VAT and other imposts in Zimbabwe.

The appellant was a supplier of basic commodities to local companies, including the West Group of Companies (West Group). In 1992, it concluded an agency agreement with Douglas and Tate (Pvt) Ltd (Douglas & Tate), a subsidiary of West Group. By 1999, it was supplying basic commodities to West Group and other local customers under a US$10 million line of credit registered with the Reserve Bank of Zimbabwe (the RBZ).

On 1 October 2007, the Reserve Bank of Zimbabwe (RBZ) unveiled the Basic Commodities Supply Side Intervention (BACOSSI), a facility designed to end the chronic shortages of basic commodities in Zimbabwe. After negotiations between the appellant and the RBZ, the latter purchased certain non-BACOSSI goods, valued at US$7,987,207=54, that were in the Douglas & Tate warehouse. The appellant also supplied BACOSSI goods, valued at US$11,698,174, to the RBZ in 2008.

After conducting investigations, the respondent raised taxation schedules against the appellant for outstanding value added tax (VAT), on both BACOSSI and non-BACOSSI transactions, initially on 17 March 2009 and later on 15 July 2009. The total charge raised was US$6,302,712=13, inclusive of interest and penalties. This was subsequently corrected, on 13 October 2009, by reducing the charge to US$6,249,496=70.

The appellant lodged an objection to the assessment on 25 September 2009. It also applied for condonation for the late filing of the objection.

The respondent dismissed the application for condonation and disallowed the objection.

The appellant appealed against both decisions to the Fiscal Appeal Court on 12 October 2009. The respondent filed its reply on 12 November 2009. At a pre-trial hearing on 17 September 2014, the delay by the appellant in filing its Notice of Objection as well as the failure by the respondent to file its documents timeously were both condoned by consent.

Judgment of the Fiscal Appeal Court

At the hearing of the matter, the appellant called the evidence of one Kenneth Sharpe, who was the founder and Chairman of West Group and a director of Douglas & Tate.

He confirmed the foreign status of the appellant. His evidence was that West Group, Douglas & Tate, and the appellant were not related companies.

The court a quo found that he was not a credible or reliable witness. This was because he contradicted material parts of his evidence-in-chief under cross-examination. Furthermore, his evidence left gaps that could only be filled by the directors, employees, officials, or agents of the appellant itself.

On the merits, the court a quo relied on the documentary evidence, i.e. the unsigned agreement between the appellant and the Reserve Bank of Zimbabwe (RBZ) and the relevant documents generated in South Africa, to find that it was the appellant that imported the goods in question into Zimbabwe. It was the appellant who beneficially owned and possessed the goods before they entered Zimbabwe and brought or caused them to be brought into the country.

It was accordingly held that the appellant was the importer of both the BACOSSI and non-BACOSSI goods.

The court further found that the activities of the appellant in Zimbabwe, from 2004 onwards, which were carried on continuously and regularly, constituted trading in the country for the purposes of VAT liability. The appellant was not a registered operator, but, every trader is liable to be registered for VAT purposes and is deemed to be a registered operator as the principal for goods supplied or imported on its behalf by its agent.

The appellant was carrying on the business of supplying goods through the agency of Douglas & Tate, which released the goods only on the instructions of the appellant after the latter had received payment in accordance with the relevant waybills and invoices.

The court held that the appellant was the importer of the goods in question and was therefore liable for the payment of VAT in both the pre-BACOSSI and BACOSSI eras when it supplied goods in furtherance of its business activities.

Furthermore, the appellant was required to be registered and had to be treated as a registered operator. Its failure to charge or receive VAT did not exonerate the appellant as VAT is deemed to be included in the purchase price. Additionally, it bore the obligation to remit VAT in foreign currency in accordance with the legislation in force at the relevant time.

As regards the appointment of the Chief Executive Officer (CEO) of West Group as the public officer of the appellant, the court found that this was above board. In terms of the governing provisions, the respondent was allowed to compulsorily appoint the CEO of West Group, the holding company of Douglas & Tate, which was the agent of the appellant in Zimbabwe, as its public officer and representative registered operator for the collection of VAT.

With respect to the appellant's argument that the respondent had used an arbitrary exchange rate to convert Rand denominated transactions to United States dollar values, the respondent averred that the relevant invoice values, together with the appropriate conversions, were supplied by the appellant's own agents.

The court found that the onus was on the appellant to establish that the conversions were arbitrary. However, it did not lead any evidence in this regard and the respondent's averments were not denied.

In the event, the court held that the appeal before it was not sustainable in its entirety. However, the appellant's objections raised important legal points and its grounds of appeal were not frivolous. The appeal was accordingly dismissed with no order as to costs.

Grounds of Appeal and Relief Sought

There are six grounds of appeal in casu. They impugn the judgment of the court a quo in the following respects:

(i) Rejecting the evidence given on behalf of the appellant as being unreliable.

(ii) Holding that the appellant, and not the Reserve Bank of Zimbabwe (RBZ), was the importer of the goods in question.

(iii) Holding that the respondent was entitled to go behind the contents of the bills of lading which it had processed and approved to find that the appellant was the importer of the goods into Zimbabwe.

(iv) Finding that the appellant operated a business in Zimbabwe.

(v) Holding that the appellant was to be treated as a registered operator and finding that the appellant was liable to pay VAT on the imported goods.

(vi) Considering the issue of whether or not any company had been lawfully appointed as an agent to pay any tax due by the appellant, and in finding that such an appointment had in fact been lawfully made.

The appellant prays that the appeal be allowed with costs and that the judgment of the court a quo be set aside and substituted with an order allowing the appeal a quo with costs and directing the respondent to withdraw the contested VAT assessments issued by it against the appellant in this matter....,.

Identity of Importer: Zimtrade or Reserve Bank of Zimbabwe (RBZ)

The second and third grounds of appeal pertain to the identity of the importer of the goods in question. Was it the Reserve Bank of Zimbabwe (RBZ), as is contended by the appellant, or was it the appellant itself?

Also relevant in this context are the contents of the bills of entry that had been submitted for processing and approval by the respondent's Department of Customs and Excise.

Counsel for the appellant submits that a bill of entry is a document that is filed by the importer.

In casu, one such bill of entry filed and approved in August 2008 identifies the appellant as the exporter/consignor, based in Guernsey. The importer/consignee is identified as the Reserve Bank of Zimbabwe (RBZ). All the other relevant bills of entry in this case contain the same information as to the identities of the exporter and the importer.

The bills of entry were issued in terms of the Customs and Excise Act.

Counsel for the appellant relies on the provisions of sections 37(1)(e), 39(1) and 40(1) of the Customs and Excise Act in support of his submission that the entries in question were made by the Reserve Bank of Zimbabwe (RBZ) as the importer.

The respondent incorrectly took the position that the appellant was the importer of the goods concerned because it owned the goods before they entered into Zimbabwe from South Africa.

The respondent, which bore the evidentiary burden in this respect, did not place any evidence before the court a quo to disprove the correctness of the bills of entry....,.

As regards the bills of entry, counsel for the respondent points to the definition of “entry” in section 2 of the Customs and Excise Act which makes it clear that the information contained in a bill of entry must be correct.

Most of the declarants on the bills in casu were employees of Mitchell Cotts Freight Zimbabwe, a freighting company. Therefore, so he submits, it was not the Reserve Bank of Zimbabwe (RBZ) but the freighting agent that completed the bills of entry.

The evidence indicates that the freighting agent was paid by the subsidiary of West Group, i.e. Douglas & Tate, which acted for the appellant.

Counsel for the respondent further submits that the bills of entry were not prepared by the respondent or the Reserve Bank of Zimbabwe (RBZ) or by any other official. Consequently, no presumption of regularity could attach to them and their designation of the RBZ as the importer is therefore not reliable or conclusive....,.

In response, counsel for the appellant submits that the contents of the bills of entry are crucial because they were officially accepted for the purposes of importation and the liability to pay tax. They show that the Reserve Bank of Zimbabwe (RBZ), which had a beneficial interest in the goods at the time when entry was made, was the importer of those goods. There was no evidence to rebut the contents of the bills of entry. In this respect, the fact that the freighting agents signed them as the declarants is irrelevant.

In terms of section 12 of the Civil Evidence Act, a bill of entry, being a public document, does not have to be made exclusively by a public officer. The bills of entry in casu were made on ZIMRA forms and their contents were accepted by ZIMRA officials. Furthermore, copies of any documents kept by a public official can be used in evidence....,.

There is a total number of 12 bills of entry on record, covering the period from 20 June 2008 to 26 August 2008. All of these bills identify the appellant as the exporter and the Reserve Bank of Zimbabwe (RBZ) as the importer. The declarants on the first seven (7) bills were representatives of Big Star Cargo Services, while the declarants on the next five (5) bills were representatives of Mitchell Cotts Freight Zimbabwe.

There can be no doubt that, prima facie, the entries on these bills of entry support the appellant's contention that it was not the importer of the goods in question....,.

As I have already stated, ex facie the contents of the bills of entry in casu the appellant was the exporter and the Reserve Bank of Zimbabwe (RBZ) was the importer of the goods in question. In light of the factual findings made by the court a quo, it becomes necessary to evaluate the legal correctness of those entries in the specific circumstances of this case.

Section 12(1) of the Civil Evidence Act [Chapter 8:01] defines a “public document” as a document made by a public officer for public use.

In terms of section 12(2) of the Civil Evidence Act, a copy of a public document is admissible in evidence as prima facie proof of the facts stated therein.

By virtue of section 12(3) of the Civil Evidence Act, a copy of a document, other than a public document, the original of which is in the custody of a State official, is also admissible in evidence.

In casu, there can be no doubt that the bills of entry produced in evidence are admissible documents within the contemplation of section 12(3) of the Civil Evidence Act. The fact that the entries therein were not made by a public officer or official of the State does not detract from their status as admissible evidence, for the obvious reason that their originals were, or should have been, in the custody of a State official.

The court a quo was very much alive to the presumption of regularity attaching to the bills of entry.

It accepted that those bills were “public documents whose contents are prima facie correct” and that, therefore, “the evidentiary onus to disprove the correctness of the contents of the bills of entry shifted to the respondent.”

HH424-13 : HONEY AND BLANCKENBERG vs LOURENCE ERASMUS VERMAAK and OTHERS
Ruled By: TSANGA J

The BackgroundThe applicant, Honey and Blanckenberg, instituted interpleader, in terms of Rule 30 of the High Court Rules, for the court to declare to whom it should pay an amount of $70,000 currently held in trust as rentals for certain companies.According to the applicant's affidavit, the companies in question are ...

Appealed
SC09-21 : ANDERSON MANJA and 98 OTHERS vs SHERIFF OF ZIMBABWE and GURTA MINING AG
Ruled By: MAVANGIRA JA, UCHENA JA and MATHONSI JA

This is an appeal against the whole judgment of the High Court handed down on 3 June 2020 which upheld the second respondent's claim to immovable property and/or mining claims located in Mashonaland West placed under judicial attachment by the first respondent for sale in execution of a judgment.The judgment ...

BACKGROUND FACTS

The appellants were employed by Amble Mining (Private) Limited. A labour dispute between them and their employer yielded an arbitral award which was registered as a judgment of the High Court. Upon execution of that judgment, a chrome mine comprising of mining claims, 110 compound houses, a shop, 6 round thatched guest houses, 3 separate guest houses, and a workshop were seized by the Sheriff.

The Sheriff sought to recover the judgment debt of USD1,199,251=88.

Following attachment, the second respondent, a company incorporated in terms of the laws of Switzerland, claimed all the property as its own.

The appellants did not admit the claim. This forced the Sheriff to institute interpleader proceedings in the court a quo to settle the conflicting claims.

The second respondent admitted that the mining claim once belonged to the judgment debtor. Its case, however, was that it had bought the property from the judgment debtor in 2009 during which year it also took transfer of the claims.

As proof of the sale, the second respondent produced a Board Resolution of a company known as Maranatha Ferrochrome (Private) Limited, the holding company of Amble Mining (Private) Limited.

The second respondent also produced a copy of a certificate of registration of the mining claim issued by the Ministry of Mines and Mineral Development in its name.

In addition to that, the second respondent also produced two letters written by the Acting Provincial Mining Director for Mashonaland West.

The letters in question are contradictory.

The first, dated 31 May 2018, stated that the mining claims belonged to the judgment debtor. The second, dated 5 July 2018, apologised for what it referred to as a “gaffe” in the earlier letter and stated that the mining claims belonged to the second respondent.

The appellants' case was that there was collusion between the Acting Provincial Mining Director, the second respondent, the judgment debtor, and Maranatha Ferrochrome (Private) Limited in order to confound creditors.

The appellants moved for the lifting of the veil of incorporation so as to expose the second respondent, the judgment debtor, and Maranatha Ferrochrome (Private) Limited as companies of the same Group.

The purported sale of the mining claims would be shown to be a sale between subsidiary companies.

The court a quo found that after producing the documents I have alluded to, the second respondent had discharged the onus of proving ownership. It had set out a prima facie case of ownership which had the effect of shifting the onus to the judgment creditors, the appellants herein, to prove otherwise.

The court a quo further found that the appellants did not adduce any evidence. As such, the prima facie case provided by the second respondent “mutated” to proof of ownership.

The appellants were aggrieved and noted this appeal on four (4) grounds.

GROUNDS OF APPEAL

1. The court a quo grossly erred by granting inter-pleader claim in the circumstances where the second respondent failed to prove ownership of the attached property on a balance of probabilities.

2. The court a quo grossly erred by failure to consider connivance between the judgment debtor and the second respondent to defeat execution of a court order.

3. The court a quo grossly erred by shifting the burden of proof to the appellants instead of the second respondent.

4. The court a quo erred by granting costs on an attorney client scale against the appellants where there was no basis for such.

THE APPEAL

Although there are four grounds of appeal, they crystallize around essentially one issue that falls for determination in this appeal. It is whether the court a quo erred in upholding the claimant's claim to the property.

It was submitted, on behalf of the appellants, that, the second respondent did not discharge the burden of proving ownership because the evidence tendered by the second respondent shows that itself, Maranatha Ferrochrome (Private) Limited, and the judgment debtor are one and the same thing. The whole arrangement, so the argument goes, to transfer the mining claims from the judgment debtor to the second respondent was meant to shield the property from execution.

To illustrate that point, counsel for the appellants drew attention to the Board Resolution relied upon as evidence of the existence of a sale agreement involving the mining claims. It was argued that a resolution is not a sale agreement but is a pre-requisite for the conclusion of a sale agreement by a company. If indeed the judgment debtor had gone on to enter into an agreement of sale, in terms of which it alienated the property to the second respondent, it was argued, then the latter would have produced, not only the agreement of sale, but also proof of payment as consideration for the mining claims.

Apart from that, counsel submitted, the fact that it is common cause that Andrew Lawson, who attended the Board of Directors' meeting of 13 October 2009, in Italy, at which the resolution was made, is also a director of the judgment debtor, is suggestive of the resolution being a sham and the transfer of the claims being an elaborate hoax.

In view of its centrality in the resolution of this appeal, the resolution, which is an extract from the minutes of an Extraordinary Meeting of the Board of Directors of Maranatha Ferrochrome (Private) Limited held on 13 October 2009 is reproduced below:

“Minutes of an Extraordinary Meeting of the Board of Directors of Maranatha Ferrochrome (Pvt) Ltd held on Tuesday 13 October 2009 in the offices of Sineco Spa in Ceparano, Italy

Present:
Mr Gialuigi Ghezzi - Chairman
Mr Giorgio Barelli – Director
Mr Andrew Lawson – Director

Apologies:
Mr. George Mashavatu – Director

The following resolutions were agreed and passed unanimously by the board of directors of Maranatha Ferrochrome (Private) Limited -

1. Maranatha Ferrochrome (Private) Limited hereby agrees to sell all mining claims and leases owned by this company and its subsidiary, Amble Mining (Pvt) Ltd, Gurta A.G. of Switzerland. These claims are, in total, to be sold for a sum of USD1,350,000 (one million three hundred and fifty thousand united state dollars). It was noted that Mr. Andrew Lawson has authority to sign and accept ownership of the said claims and mining lease on behalf of Gurta A.G. by means of a Power of Attorney from Gurta A.G.

2. Mr Keith Beck – ID NO. - 32-058218 N00 is hereby empowered to transfer ownership of the above-mentioned mining claims and leases on behalf of Maranatha Ferrochrome (Pvt) Ltd and Amble Mining (Private) Limited.”…,.

A simple interpretation of this resolution, which is obviously not an agreement of sale, is that Andrew Lawson, a director of the alleged seller of the mining claims (Maranatha) was given a power of attorney by the alleged purchaser of those claims, the second respondent, to receive delivery of the claims from the same seller in which he is a director. He was to hold the claims on behalf of the alleged new owner.

This was a classic case of the seller selling to itself.

It is also remarkable, that, after agreeing to sell the mining claims, the alleged seller does not appear to have progressed further to accomplish the mission. No sale agreement was produced. In addition, the closest the second respondent came to proving movement of funds to purchase the claims, is an invoice dated 18 December 2018 setting out the values of the 54 Blocks of Ngezi mining claims being US$1,050,000. It also shows the value of the 6 Blocks of Mapanzura mining claims, being US$300,000.

It is needless to say that the invoice, being neither a receipt nor a bank statement, does not prove anything.

I mention, in passing, that, if indeed money had changed hands, the second respondent would not have had any difficulties producing proof of payment.

Counsel for the appellants also made reference to the lease agreements produced by the second respondent.

Again, because of its importance in shedding light to the dispute between the parties, I reproduce the pertinent part of the standard document hereunder:

“LEASE AGREEMENT

A settlement agreement was negotiated between Upthrow Trading (Private) Limited, Maranatha Ferrochrome (Pvt) Ltd, Amble Mine (Private) Limited, Gurta AG, Glossy Investments (Private) limited and Honourable Paul Mangwana and signed in Italy on 3 October 2013. In terms of this settlement agreement, following the completion of the handover of the mining claims, Maranatha Ferrochrome (Private) Limited representing Gurta AG who are the legitimate owners of the mining claims in Ngezi do hereby offer the Lease Agreement Arrangement for the property known as:

WHITE HOUSE ROOM 3

The lessee hereby agrees to rent the said property (on) for a period of 3 months with effect from 1 September 2015 expiring on 3 November 2015 subject to the payment of monthly rentals amounting to US$25 to Maranatha Ferrochrome (Private) Limited. Lease may be terminated by either party giving two weeks as notice of termination.”…,.

Again, a simple interpretation of the lease agreements which the second respondent entered into with its alleged tenants shows that six (6) years after the second respondent had purportedly purchased the mining claims and their environs from the judgment debtor, the latter was still being listed on the lease agreements as having an interest in the property.

Not only that, the second respondent was still not visible on the ground to an extent that the leases were written on the letterhead of Maranatha Ferrochrome (Private) Limited - the parent company of the judgment debtor.

If that set of facts was not disconcerting enough, then, it should indeed be remarkable to note that Maranatha Ferrochrome (Private) Limited was also receiving rentals for the leased properties.

Those facts cannot be ignored.

The documents from the Ministry of Mines and Mineral Development, relied upon by the second respondent, had their own challenges.

Counsel for the appellants submitted that the certificate of registration purportedly showing that the claims had changed hands was a photocopy. Although the second respondent was challenged to produce the original, it failed to do so.

More importantly, when the Ministry was requested to confirm the status of the mining claims, it initially wrote a letter dated, 31 May 2018, signed by one M. Maisera, the Acting Deputy Provincial Mining Director for Mashonaland West, which states in part:

“This office acknowledges receipt of your letter dated 24 May 2018 in which information of mines held by Amble Mining (Private) Limited is requested.

According to records held by this office, Amble Mining (Private) Limited is the holder of the following chrome blocks…,.”

It is common cause that the listed blocks are those that were placed under attachment and form the dispute between the parties.

There may have been a change of the Acting Provincial Mining Director for Mashonaland West because, on 5 July 2018, S. Mpindiwa, writing under that title, was singing a different tune.

In S. Mpindiwa's letter to the appellants' legal practitioners, he/she apologised for what he/she referred to as “a gaffe” in stating that the judgment debtor owned the mining claims. Instead, that office then stated that the mining claims were long transferred to the second respondent.

Unfortunately, the letter did not explain how the “gaffe” came about.

Counsel for the appellants pointed to this contradiction as proof..., that the information from the Ministry of Mines could not be relied upon.

View Appeal
HH351-20 : THE SHERIFF OF ZIMBABWE and GURTA AG vs ANDERSON MANJA and 98 OTHERS
Ruled By: CHIKOWERO J

JUSTIFICATIONThe HOLY BIBLE, CONCORDANCE AUTHORIZED KING JAMES VERSION, 2013 p1078 reads, in Ecclesiastes 4:09-12:“9. Two are better than one; because they have a good reward for their labour.10. For, if they fall, the one will lift up his fellow: but woe to him who is alone when he falls; for ...

JUSTIFICATION

The HOLY BIBLE, CONCORDANCE AUTHORIZED KING JAMES VERSION, 2013 p1078 reads, in Ecclesiastes 4:09-12:

“9. Two are better than one; because they have a good reward for their labour.

10. For, if they fall, the one will lift up his fellow: but woe to him who is alone when he falls; for he has not another to help him up.

11. Again, if two lie together, then they have heat: but how can one be warm alone?

12. And, if one prevail against him, two shall withstand him; and a threefold cord is not quickly broken.”

I therefore refer to a number of legal sources as well as illustrations in determining this inter pleader application.

CLAIMANT BEARS THE ONUS TO PROVE THAT THE ATTACHED PROPERTY BELONGS TO IT AND MUST DISCHARGE THAT ONUS ON A BALANCE OF PROBABILITIES

In Sabarauta v Local Authorities Pension Fund and the Sheriff SC77-17, UCHENA JA, writing for the Zimbabwe Supreme Court, said:

“Interpleader proceedings are instituted by the Sheriff in respect of property attached by him when a third party claims ownership of that property. In such proceedings, it is necessary for the party claiming the attached property to prove ownership by clear and satisfactory evidence.”

In The Sheriff for Zimbabwe v Mahachi and Leomarch Engineering HMA34-18, MAFUSIRE J puts it thus…,:

“One common thread running through such cases, and several others on the point, is that there is a rebuttable presumption that where someone is found in possession of movable goods, they are presumed to be the owner of that property.

Where someone else other than the possessor claims to be the owner of those goods, they have the onus to prove, on a balance of probabilities, that they are the owner. There are no hard and fast rules on how they may go about proving such ownership. Every case depends on its own facts. The claimant may have to produce some evidence, such as receipts or other documents, if available, to prove ownership. A bald assertion that they are the owner is not enough.”…,.

The facts of each matter ultimately resolves the question whether clear and satisfactory evidence has been tendered by a claimant to satisfy the court, that, on a balance of probabilities, the property attached belongs to the claimant. The road to proving ownership is not a one way street.

WHERE THE CLAIMANT HAS PRODUCED SUFFICIENT EVIDENCE TO CONSTITUTE PRIMA FACIE PROOF OF OWNERSHIP THE ONUS SHIFTS TO THE JUDGMENT CREDITOR TO DISPROVE SAME BY PRODUCING EVIDENCE TO THE CONTRARY

The claimant does not need, at this stage, to prove, on a balance of probabilities, that the attached property belongs to it. All that is required of it is to show, on the face of it, that the property probably belongs to it.

That is what prima facie proof means in civil cases.

The onus then shifts to the judgment creditor to disprove the claimant's prima facie evidence of ownership by producing its own evidence to the contrary.

If the contrary evidence satisfies the court, the claim fails and execution proceeds. The converse is true.

The judgment creditor cannot successfully disprove the claimant's prima facie evidence of ownership by making unsubstantiated assertions in its own opposing affidavit. Neither can it do so through composing heads of argument based on the bare assertions in the opposing affidavit.

It follows also that argument at the hearing of the inter pleader application is no substitute for a judgment creditor's failure to produce contrary evidence to disprove the claimant's prima facie evidence of ownership of the attached goods.

If the judgment creditor cannot disprove the claimant's prima facie evidence of ownership, the result is this: What was prima facie evidence of ownership is transformed into proof on a balance of probabilities. The attached goods are then declared not executable and their release from attachment ensues.

This procedure has a parallel in Criminal Law.

If the State establishes a prima facie case against an accused who then opens and closes his defence case without without leading any evidence at all that person will be convicted. The conviction is not based on the prima facie case. It is no longer that. It has graduated to become proof beyond a reasonable doubt for want of any competing evidence.

In (1) Smit Investments Holdings SA (Proprietary) Limited (2) Genet Mining (Proprietary) Limited v (1) The Sheriff of Zimbabwe (2) Pungwe Mining (Private) Limited SC33-18 PATEL JA, with whom MALABA CJ and HLATSHWAYO JA concurred, said…,:

“In a bid to prove its ownership of the assets, the first appellant produced statements of account for Mbada Mine which showed that some payments, but not all, had been made by Mbada Mine. In addition, both appellants produced detailed agreements concluded with Mbada Mine (on 15 July 2012 and 22 July 2015), respectively, which stipulated that ownership of the assets would remain with the appellants until the full purchase price was paid. It was the court a quo's finding that the agreements were not authentic and that there was collusion between the appellants and Mbada Mine.

It was alleged, by the second respondent, that, the agreements were doctored by Mbada Mine and the appellants ex post facto and that there was no paper trail to show that the assets belonged to the appellants.

However, no evidence was led to substantiate the second respondent's allegations of collusion.

The court relied on the bald averment by the second respondent that the documents were not authentic and simply took that to be correct.

It is the second respondent that levelled allegations of inauthenticity and collusion. Consequently, it is the second respondent that should have proven the same.

This position was succinctly captured in the case of Circle Tracking v Mahachi SC4-07, where the court held that the principle that he who alleges must prove is a basic concept of our law.

No evidence was adduced by the second respondent to substantiate the alleged inauthenticity of the agreements.

The appellants produced documents which show that the assets had been procured by them and initially belonged to them. They also produced the agreements concluded with Mbada Mine in 2012 and 2015 which show that ownership was reserved in favour of the appellants until the full purchase price was paid. The relevant provisions are contained in clauses 4.3 and 11.6 of the first appellant's agreement and clause 7.7 of the second appellant's agreement.

The second respondent alleged that the documents supporting the appellants' claims were a recent fabrication meant to frustrate the execution of the assets, but, the dates when the agreements were concluded reveal that they were executed well before the second respondent instituted any legal proceedings in this matter. There is also nothing in the record to give credence to the allegations that the documents were fabricated by the appellants in collusion with Mbada Mine. It is my view, therefore, in the absence of any evidence to the contrary, that the agreements are genuine and that their provisions and the agreed compacts contained therein must be accepted as being authentic, as well as commercially and legally cognizable.”

This court's decision in the Sheriff of Zimbabwe v Senital (Pvt) Ltd t/a Frank B Mine and Zimbabwe United Passenger Company Ltd HB233-18 underscores this point. There, MAKONESE J expressed it in these words…,:

“The claimant refuted the allegations that the property belonged to the judgment debtor, and, in a bid to prove ownership of the attached property, the claimant attached some receipts and agreements of sale as proof of the attached assets. An agreement of sale is taken as prima facie proof of ownership. Where a claimant tenders some acceptable proof of ownership the onus must necessarily shift to the judgment creditor disproving the claimant's ownership of the attached goods.”

Similarly, CHITAPI J explained in The Deputy Sheriff Marondera v Hombarume and 7 Ors HH521-18…,:

“In my view, this claimant's claim is not far fetched. The claimant did not just attach the registration book as proof of legal ownership. He attached the official motor vehicle extract from Central Vehicle Registry. It gives details of the importation of the vehicle by the claimant and proof of payment of import duty and police clearances. In such a situation, the onus to prove that the third claimant is not the owner of the vehicle must shift to the judgment creditor. Where the claimant places before the court acceptable evidence of ownership or of some other legally recognizable ground warranting release of the attached property from execution, the onus shifts on the party who impugns such evidence to controvert it.”...,.

THE FACTS

The judgment creditors were employees of Amble Mining (Private) Limited. The latter traded as Amble Mine.

On 24 May 2010, an Independent Arbitrator granted an award ordering the Mine to reinstate the 99 employees with effect from March 2006 without loss of salary and benefits. As an alternative, the Mine was to pay them certain sums for back pay, damages for loss of employment, punitive damages, housing allowance, cash in lieu of leave and cash in lieu of notice. The total amount was US$1,199,251=88.

The date when the matter was referred to the Arbitrator is not disclosed in the papers. Also kept under wraps is the history of the labour matter leading up to the award.

Amble Mining (Pvt) Ltd is the judgment debtor.

On 28 June 2017, the employees filed a court application for registration of the arbitral award. The application to register the award as an order of this court was granted, unopposed, on 16 August 2017.

A Writ of Execution Against Movable Property must have been issued. I have not seen it. What I have perused, both in the court record relating to registration of the arbitral award and the present matter is a Writ of Execution against immovable property. It was issued on 18 June 2018. In the writ is a statement speaking to a nulla bona return of service. The nulla bona return of service was not placed before me. I do not know when it was issued. I am also in the dark as to where the Sheriff had sought to effect the attachment.

However, as regards the immovable property, the Sheriff was instructed to attach and execute what was said to be the judgment debtor's property being a certain chrome mine comprising of:

(i) The mining claim, being a block of 25 mining claims known as BEE 47 registered as No. G310 BM.

(ii) 110 compound houses.

(iii) 1 x shop.

(iv) 6 x round thatched guest houses tiled/geyser.

(v) 3 separate guest houses.

(vi) Workshop.

This was to realize the sum of US$1,199,252=99 which was the alternative remedy to reinstatement.

On 26 June 2018 the Sheriff wrote to the Provincial Mining Director, Mashonaland West Province attaching the mining claim in question together with everything else listed on the writ of execution against immovable property.

Gurta AG is the claimant. It is a company incorporated in terms of the laws of Switzerland. It is therefore a peregrinus. It has paid security for costs.

Gurta AG filed an affidavit with the Sheriff claiming ownership of all the attached property. The affidavit was deposed to by Carlo Ghezzi. He is a Board member and Chairman of the claimant.

The claimant admits that the mining claim used to belong to the judgment debtor. However, the claimant purchased the same sometime in 2009 and took transfer the same year.

In an endeavor to prove its claim, Gurta AG annexed certain documents to the affidavit delivered to the Sheriff.

Those documents are copies each of the certificate of registration of the mining claim after transfer; a Board Resolution of Maranatha Ferro Chrome (Pvt) Ltd, signed by the chairman and secretary on 15 October 2009, reflecting that the Board agreed, on 13 October 2009, to sell all its mining claims as well as those of its subsidiary, Amble Mining (Pvt) Ltd, to Gurta AG for US$1,350,000; an unsigned document on Maranatha Ferrochrome's letterhead said to be an invoice relating to the Sale and a Lease Agreement on Maranatha Ferrochrome's letterhead, dated 9 September 2015, in terms whereof Joseph Wirima rented one of the rooms at the mining claim for a period of 3 months running from 1 September 2015 to 30 November 2015 at a rental of US$25 per month.

The judgment creditors rejected the claim.

This led to the Sheriff instituting these inter-pleader proceedings.

The claimant, in a bid to prove its claim before this court, again filed an affidavit by the same deponent. It annexed thereto copies of the same documents as previously laid before the Sheriff. This time, it attached also copies of two letters written by the Acting Provincial Mining Director Mashonaland West on behalf of the Secretary for Mines and Mining Development. The letters are dated 5 July 2018. One was addressed to the judgment creditor's then legal practitioners, Citizens Legal Society and Advisory Trust. The other was addressed to the Sheriff's office.

In both letters, the Ministry of Mines and Mining Development, through the author, set the record straight by advising that the mining claim in question belongs to the claimant as evidenced by records reflecting transfer as having been effected to Gurta AG on 26 October 2009.

The author apologized to both addressees for a mistake which had been made in an earlier letter to Citizens Legal Society and Advisory Trust on 31 May 2018 which stated that the mining claims, and two other claims, belonged to the judgment debtor.

THE JUDGMENT CREDITORS' POSITION

Besides the letter of 31 May 2018 from the Ministry of Mines and Mining Development (which was superseded by the letters of 5 July 2018 from the same Ministry) the judgment creditors did not produce any evidence to contradict that tendered by the claimant.

They alleged collusion between the Acting Provincial Mining Director, Mashonaland West, the claimant, the judgment debtor, and Maranatha Ferrochrome (Pvt) Ltd to cook up the documentary evidence which the claimant placed before me.

I was told that there was therefore no sale of the mining claim in question to the claimant because all the documents speaking to such sale and transfer of the claim were fabricated.

The judgment creditors, in opposing papers, heads of argument, supplementary heads of argument, and oral argument at the hearing said this:

No paper trail leading up to transfer of the mining claim to the claimant had been put before me. There was therefore neither sale nor transfer of the mining claim in favour of Gurta AG. The claim was still registered in the name of the judgment debtor and therefore executable.

The argument was premised upon section 275 of the Mines and Minerals Act [Chapter 21:05] which reads in relevant part:

“275 Registration of transfer of mining locations and transfer duty payable

1. When any registered mining location or any interest therein is sold or otherwise alienated in any manner whatsoever, the seller or person who so alienates shall notify the mining commissioner of the transaction within sixty days of the date of such transaction, and shall inform him of the name of the person to whom such location or interest is sold or otherwise alienated and of the amount of the valuable consideration, if any, agreed upon and the date of the transaction.

2. When any registered mining location, or any interest therein, has been sold or otherwise alienated, whether before or after the first November, 1961, in any manner whatsoever, for valuable consideration, transfer duty at the rate fixed by Parliament shall be paid by the purchaser, which terms shall include any person becoming entitled to such location or interest therein by way of sale, exchange or other like transaction;

1….,.

2….,.

3….,.

4. Subject to this Act, any person entitled to be registered as the holder of a registered mining location, or any interest therein, shall make application to the mining commissioner for the transfer of such location or interest, and every such application shall be in writing and signed by or on behalf of the applicant, and shall be accompanied by the following particulars -

(a) The last issued certificate of registration or of special registration of the location or the holder's copy of the mining lease, as the case may be;

(b) Certificates by the transferor and transferee in the prescribed form;

(c) A duplicate original grosse or notarially certified copy of any and every existing written agreement affecting or bearing upon the sale, alienation, exchange or transfer;

(d) In the event of there being no such existing written agreement, certificates by the transferor and transferee to that effect;

(e) The original or notarially certified copy of any power of attorney which may be required to authorize an agent to act on behalf of any party to the transfer; if the original power is lodged with the mining commissioner and the applicant does not wish the mining commissioner to retain it, he shall furnish with it a copy which the mining commissioner shall compare with the original, certify to be a true copy and retain;

(f) If such application is in respect of the transfer of any mining location registered for precious stones or any interest therein, a certificate from the secretary that the Minister has granted the permission required under section two hundred and eighty two in respect of such transfer.

5. The mining commissioner shall, on receipt of such application and other documents, and of the transfer duty or, if no such duty is or may in the future be payable or the whole of such duty has been remitted under subsection (9) of the prescribed fee, and if he is satisfied that the other provisions of this Act have been complied with, register transfer by making the necessary entries in his registers and other records: Provided that -

(i) No transfer, as aforesaid, shall be valid unless it has been registered by the mining commissioner, and no such registration shall be made -

(a) Where such location is liable for forfeiture or under attachment;

(b) Until dues, fees, royalties, rents or other moneys due and payable to the mining commissioner under this Act in respect of the property to be transferred have been paid;

(c)…,.

(d) Where the transferee is not a permanent resident of Zimbabwe, unless the mining commissioner, after consultation with the Reserve Bank of Zimbabwe, is satisfied that all requirements imposed by or under the Exchange Control Act [Chapter 22:05] have been complied with;

(i)…,.

(ii)…,.

(8) The mining commissioner shall also, on receipt of the prescribed fee, issue to the transferee a certificate in the form prescribed and such certificate shall record the interest of the transferor, whether whole or otherwise, in such block.”

The judgment creditor's alternative argument was this:

Should I find that there was a sale then I should pierce the corporate veil on two grounds:

(i) Gurta AG, Amble Mining (Pvt) Ltd, and Maranatha Ferrochrome (Pvt) Ltd were companies in the same Group. The first two were subsidiaries of the third. Therefore, the sale was between subsidiary companies.

(ii) Secondly, there was fraud involved because the sale and transfer of the mining claim were designed to defeat the judgment creditors' entitlement to attach the mining claim by taking it out of the judgment debtor's hands.

THE ANALYSIS

I am satisfied that the claimant established, prima facie, that the mining claim belongs to it. The precise legal position is that the holder of a mining claim has the right to work such claim to the exclusion of everyone else.

The totality of the documentary evidence tendered by the claimant satisfies me in this regard.

It is true that the date stamp on the copy of the certificate of registration on record is not legible to the extent that the day and month of registration of the transfer is not visible. But the year of registration of that transfer is reflected on the document as being 2009. The two letters from the Ministry of Mines and Mining Development, dated 5 July 2018, clearly state the date of registration of the transfer as 26 October 2009. So, the letters cure the deficiency appearing on the copy of the certificate in question.

What I have is a copy of the certificate, not the original.

The transfer number for the certificate in question is given in the letter which was addressed to Citizens Legal Society and Advisory Trust. It is TR 6627. That is the transfer number appearing on the copy of the Certificate of Registration after transfer tendered by the claimant. When issuing a duplicate original Certificate of Registration to a holder, the office of the Mining Commissioner obviously retains the original on file.

The Certificate of Registration is documentary evidence issued and signed by the Mining Commissioner in Harare. The letters of 5 July 2018 are pieces of documentary evidence authored by the Acting Provincial Mining Director, Mashonaland West in Chinhoyi. All three documents confirm that the claimant is the registered holder of the claim in question since 2009.

No contrary evidence was led by the judgment creditors to demonstrate that the certificate of registration was cancelled by the Mining Commissioner for whatever reason or disowned by him as being inauthentic or that the letters of 5 July 2018 contain falsehoods.

This court is not the Mining Commissioner. This court does not issue certificates of registration of mining claims. The person who must be satisfied that section 275 of the of the Mines and Minerals Act has been complied with is the Mining Commissioner. It is him, and not myself, who is under obligation to receive, peruse, and be satisfied with the documentation required before he issues a certificate of registration.

No evidence was placed before me, by the judgment creditor, to demonstrate that the certificate of registration in question was issued outside the statutory requirements.

The judgment creditor's criticism of the Board resolution to sell the mining claim to the claimant, the invoice, and the lease agreement, cannot be evidence tendered by the judgment creditor disproving the authenticity of the sale and transfer.

The courts have accepted that business persons often record their dealings in terms which perfectly make sense to them but are often wanting in clarity to the legal mind. One must therefore read commercial documents sensibly. A mere reading of a commercial document, standing alone, may not make much sense because the context of its making may not appear within the four (4) corners of the document.

This is how I have looked at the invoice, the lease agreement, and the Board resolution.

For example, the lease agreement entered into on 9 September 2015, at Ngezi Mining Area, with the tenant, Joseph Wirima, is recorded as:

“A Settlement Agreement was negotiated between Upthrow Trading (Pvt) Ltd, Maranatha Ferro Chrome (Pvt) Ltd, Amble Mining (Pvt) Ltd, Gurta AG, Glossy Investment (Pvt) Ltd and Honourable Paul Mangwana and signed in Italy on 3 October 2013. In terms of this Settlement Agreement, following the completion of the handover of the mining claims, Maranatha Ferro Chrome (Pvt) Ltd, representing Gurta AG who are the legitimate owners of the mining claims in Ngezi, do hereby offer the Lease Agreement/Arrangement for the property known as: WHITE HOUSE ROOM 3…,.”

The judgment creditor led no evidence from Joseph Wirima (the tenant), C Mutema (the witness to the lease agreement), Upthrow Trading (Pvt) Ltd, Glossy Investments (Pvt) Ltd and Honourable Paul Mangwana.

In respect of Joseph Wirima and C Mutema, there was no evidence that the lease agreement between the former and the claimant, represented by Maranatha Ferro Chrome (Pvt) Ltd, was inauthentic and not entered into on 9 September 2015 but after the attachment of the mining claim on 27 June 2018 - almost 3 years later.

Similarly, the judgment creditor adduced no evidence from Upthrow Trading (Pvt) Ltd, Glossy Investments (Pvt) Ltd and Honourable Paul Mangwana on the nature of the Settlement Agreement between these companies, Paul Mangwana, the judgment debtor, and the claimant.

(1) Smit Investments Holdings SA (Proprietary) Limited (2) Genet Mining (Proprietary) Limited v (1) The Sheriff of Zimbabwe (2) Pungwe Mining (Private) Limited SC33-18, Sheriff of Zimbabwe v Senital (Pvt) Ltd t/a Frank B Mine and Zimbabwe United Passenger Company Ltd HB233-18, and The Deputy Sheriff Marondera v Hombarume and 7 Ors HH521-18 are clear that where the claimant has made out a prima facie case that it is the owner of the attached goods the onus shifts to the judgment creditor to controvert such evidence.

Evidence can only be controverted by other evidence, not through heads of argument or oral submissions - the sole purpose of which is to endeavour to punch holes into a case which is already prima facie established.

The sale and transfer of the mining claim occurred in 2009.

This arbitral award was not yet in existence. Accordingly, there was no basis for the judgment creditor's assertions of fraudulent conduct and collusion between the claimant, the judgment debtor, and Maranatha Ferro Chrome (Pvt) Ltd.

There was no execution to defeat at the time of sale and transfer of the mining claims.

It was not even disclosed by the judgment creditor when it is that litigation in their labour case with the judgment debtor was instituted: see S v Stead 1991 (2) ZLR 54 (S); Mkombachoto v Commercial Bank of Zimbabwe Ltd and Another 2002 (1) ZLR 21 (H).

Still, on lifting the corporate petticoat of Gurta and peering behind it, I see no other exceptional circumstance justifying the same.

The judgment creditor told me, both in heads of argument and at the hearing, that, Maranatha Ferro Chrome (Pvt) Ltd, the judgment debtor, and the claimant are a single economic entity. I was therefore invited to go behind the claimant's skirt, disregard the three companies' separate corporate personalities and order execution of the mining claim, even though registered in the claimant's name, to satisfy the judgment debt owed by Amble Mining (Pvt) Ltd.

Counsel for the judgment creditor referred me to Deputy Sheriff Harare v Trinpac Investments (Pvt) Ltd and Anor HH121-11.

That case is distinguishable.

Here, there is no evidence at all as to who the shareholders of the claimant are. There is completely no evidence to prove that they are the same persons as the shareholders of the judgment debtor and its holding company, Maranatha Ferro Chrome (Pvt) Ltd. Neither is there any evidence that the directorship of the claimant is the same as that of the other two companies.

The bare allegation that the claimant is a 'baby' of the “Ghezzi family” was not substantiated. I therefore refuse to interfere with the claimant's corporate regalia: see Sibanda v JLF (Pvt) Ltd & Anor SC117-04.

HAS CLAIMANT PROVED ITS CASE ON A BALANCE OF PROBABILITIES?

In The Sheriff for Zimbabwe v Mahachi and Leomarch Engineering HMA34-18, MAFUSIRE J stated that there are no hard and fast rules on how a claimant goes about proving ownership of attached goods.

I fully subscribe to that view.

Examples abound, both at law and in life experiences. It is not every case where ownership is proved through production of receipts and agreements of sale. Also, in encouraging pupils to think outside the box, teachers would sometimes say, even after John had answered a question:

“Yes, there are many ways of killing a cat, Mary what is the answer?”

The route does not always matter. What is important is a safe journey.

For example, it is a fact notorious for judicial notice to be taken of that people in most African countries would, if travelling by air, have to board a plane to London or Paris first before connecting to a flight back to their African destinations. That does not make London or Paris the destination.

Olivia Charamba and The Fishers of Men realised this when they sang:

“Kana uchienda
Uchienda
Kwaunoda
Kwaunoda
Kune nzira
Kune nzira
Dzakawanda
Dzakawanda
…,..
Nzira dzekuenda kuGweru:
Kune Kadoma;
Chivhumudhara;
…,.”

These Shona lyrics simply mean that a traveller has a choice on the route to take to a destination. The gospel musician and her band then gave the example of the availability of two options when travelling to the Midlands Province city of Gweru: either through the Mashonaland West town of Kadoma or through the Mashonaland East town of Chivhu (also called “Chivhumudhara” or “The Republic of Enkeldorn”).

The judgment creditors were rigid.

They were of the view that ownership could only be proven by the claimant producing the documentation listed in section 275 of the Mines and Minerals Act [Chapter 21:05]. That was too narrow a view of the matter.

They appear not to have been alive to the law relating to shifting of the onus as laid down by the Supreme Court and applied in numerous decisions of this court. The result is that they did not realize that they had no defence to the claim right from the word go.

Full instructions appear not to have been taken and exhaustive legal research seems not to have been conducted by their legal practitioners.

On perusal of the claimant's initial affidavit and annexures laying claim to the property, the legal practitioners should have gone to the office of the Mining Commissioner in Harare to peruse the Ministry of Mines and Mining Development's file relating to the claim in question rather than being content in seeing permanent and unshifting onus on the shoulders of a party who did not bear the same.

The legal practitioners should thereafter have fully researched on the law relating to interpleader matters.

The law on interpleader claims is simple and readily available both in the textbooks and decided cases of the Supreme Court and this court. In the course of this judgment, I referred to some of those decisions. I also referred to the words of wisdom from two legal practitioners: the first an academic and the other one of the finest court lawyers that this nation has produced.

My view is that the two sets of legal practitioners who represented the judgment creditor in this matter, at different stages, should clearly have done better.

COSTS

The claim should never have been opposed. At the very least, the judgment creditor's legal practitioners should have gathered sufficient facts and evidence, both oral and documentary, for purposes of properly advising their clients.

I add that considering that the judgment creditors were a staggering 99 persons, the importance of the matter, its effect on them, and the monetary value of the arbitral award, a thorough job needed to be done to advance their interests rather than exposing them to further unwarranted financial prejudice in the form of legal fees and costs. If properly advised, the judgment creditors may not have opposed this claim.

It is for these reasons that I exercise my discretion on costs. I do not order punitive costs. The fault in defending the claim, as I have found, lies elsewhere.

ORDER

In the result, the following order shall issue:

1. The claimant's claim to all the immovable property which was placed under attachment in execution of judgment in HC5852/17 be and is hereby granted.

2. All the mining claims attached in terms of the letter written to the Provincial Mining Director, Mashonaland West, dated 26 June 2018, are declared not executable.

3. The judgment creditors shall jointly and severally, the one paying the others to be absolved, pay the claimant and the applicant's costs of suit.

SC19-21 : CHEVHU HOUSING CO-OPERATIVE SOCIETY LIMITED AND OTHERS vs CREST BREEDERS INTERNATIONAL (PVT) LTD AND MINISTER OF LANDS AND RURAL SETTLEMENTS
Ruled By: BHUNU JA, MATHONSI JA and KUDYA AJA

The appellants are nine cooperative societies which have been dishing out residential Stands at a piece of land known as Saturday Retreat Estate (the land) for quite some time. The land is held by the first respondent by Deed of Transfer number 4035/86 and was acquired by the Government of Zimbabwe for urban development by Acquisition of Land Order dated 20 March 2014.

Following the acquisition, the second respondent herein, who is the acquiring authority, filed an application against the first respondent in the Administrative Court (the court a quo) for confirmation of the compulsory acquisition order.

The matter was settled between the parties as a result of which a consent order was issued by the court a quo on 13 January 2015.

The consent order confirmed the compulsory acquisition and made provision for compensation due to the first respondent in terms of the agreement of the parties therein.

Almost five years after the consent order was granted in the matter involving the two respondents, the appellants approached the court a quo seeking a rescission of that judgment in terms of Rule 449 of the High Court of Zimbabwe Rules, 1971.

The basis of the rescission of judgment application was that the judgment was granted either in error or fraudulently in the absence of the appellants.

Before the court a quo, the first respondent raised a number of points in limine, namely;

(i) That the application was filed out of time without seeking condonation for the delay;

(ii) That the appellants lacked locus standi in judicio to seek a rescission of an agreement in which they were not a party; and

(iii) That there was no fraudulent misrepresentation in the grant of the consent order.

By judgment delivered on 6 March 2020, the court a quo upheld the preliminary points. This appeal is against that judgment of the court a quo.

This Court finds that the appeal is completely devoid of merit. It ought to be dismissed with costs.

BACKGROUND

By Government Gazette Extraordinary published on 7 September 2001, a preliminary notice in terms of section 5(1) of the Land Acquisition Act [Chapter 20:10], of the intent to acquire the land for resettlement purposes, was issued.

Subsequent to that, the acquisition for resettlement was not pursued, presumably upon a realisation that the land was earmarked for urban settlement.

Notwithstanding that, the appellants later occupied the land and started parcelling out residential Stands to their members. Their case is that they were offered the land for that purpose by the Government as it was by then State land given that a preliminary notice of intent to acquire the land had been published in 2001.

As I have said, it was not until 20 March 2014 that the Government commenced the process of the lawful compulsory acquisition of the land for urban development.

On that date, the second respondent issued an acquisition of land order. As required by law, the second respondent brought an application before the court a quo, under case number LA6/14, for confirmation of the compulsory acquisition and compensation to the first respondent.

The proceedings in the court a quo led to the signing of a settlement between the first and second respondents, on 18 December 2014, which was incorporated in the consent order sought to be rescinded. The Order reads:

“BY CONSENT IT IS ORDERED THAT:

1. The compulsory acquisition of the immovable property, being the remaining extent of Saturday Retreat Estate situated in the District of Salisbury measuring One Thousand and Fifty Seven comma three eight one (1,057,3810) hectares held under Deed of Transfer 4035/1986 (“the Property”) by the respondent be and is hereby confirmed.

2. The respondent is entitled to full compensation for the compulsory acquisition of its urban land.

3. The manner of compensation shall be as set out in the Memorandum of Agreement entered into between the Government of Zimbabwe and the respondent, dated 18 December 2014, a copy of which is annexed to this order as Annexure A.

3.1 The respondent be and is hereby allocated the unoccupied portion of the property measuring 401 hectares.

3.2 The respondent is hereby appointed the sole and exclusive developer of the property defined in the Deed of Settlement measuring 401 hectares.

3.3 The terms and conditions of such appointment shall be governed by the Agreement entered into between Government of Zimbabwe, represented by the Ministry of Local Government and Urban Development, and the respondent, a copy of which is annexed to this order as Annexure A.

4. The Government of Zimbabwe shall sign all such documents, pass all such instruments, give such instructions, and do all things necessary to give effect to this Court order.

5. There shall be no order as to costs.”

Following the consent order, the Deed of Transfer, in terms of which the first respondent held the land, was endorsed on 18 December 2015 to the effect that it now vests in the President.

It is common cause that the appellants became aware of the grant of the court order sought to be rescinded as far back as 2015. The application for rescission of judgement was only filed on 13 December 2019, about 4 years later, without seeking condonation.

PROCEEDINGS A QUO

Before the court a quo, the appellants' case was that the court a quo was misled into granting the consent order and therefore granted the order in error.

The error was in the sense that the first respondent was not the owner of the land in question, it having been acquired by the Government in 2001, and, following such acquisition, it was allocated to the appellants.

Further, the appellants have an interest in the land and had to be consulted before the consent order was granted.

In addition, the appellants contended that the consent order was fraudulently obtained in the sense that the first respondent fraudulently misrepresented to the second respondent, and the court, that, it had entered into agreements with them in terms of which the occupants agreed to pay $4 per square metre of land occupied by them. According to the appellants no such agreements were entered into.

The first respondent's case before the court a quo was that the application for rescission of judgment was filed out of time without seeking condonation at the time they had become aware of the consent order and had thus been complicit for years.

Further, the first respondent took the view that the appellants did not have locus standi to contest an agreement entered into in settlement of an application for confirmation of compulsory acquisition of urban land and compensation thereof.

As they lay a claim through the Government, the appellants could not possibly be cited in proceedings brought in the process of acquisition.

Regarding the agreement relating to payment for the land occupied by the appellants' members, the first respondent insisted that indeed it had agreements with individual occupiers. The appellants had been in illegal occupation of the land which was only lawfully acquired in 2014. The first respondent maintained that it had separate arrangements with some of the occupiers who are paying for the land directly to it.

FINDINGS A QUO

The court a quo found that the delay of almost 5 years in bringing the application was too long, and, as such, condonation should have been sought giving an acceptable explanation for failure to act expeditiously.

It found, further, that there was need for relative certainty and finality in litigation.

On the aspect of the alleged fraudulent misrepresentation to obtain the consent order, the court a quo found that none had been proved in court.

Regarding the appellants' locus standi, it was the court a quo's finding that none of the appellants were privy to the agreement entered into between the first and second respondents. As such, they had no legal standing to seek a rescission of an agreement they were not party to.

As I have already stated, the court a quo upheld the points in limine.

THE APPEAL

The appellants were aggrieved by the judgment of the court a quo and noted an appeal to this Court on four grounds of appeal. They are:

1. The learned judge a quo erred at law in failure to dispose of the first point in limine by the first respondent.

2. The learned judge a quo erred at law in holding that the appellants lacked locus standi to apply for rescission of the judgment granted by the court on 13 January 2015.

3. The Honourable Court erred at law, in so far as it may be taken to have upheld the first point in limine, in holding that there was need for the appellants to apply for condonation of the late noting of the application for rescission and that the appellant failed to prove fraud.

4. The honourable lower court erred at law in allowing a judgment obtained through fraudulent means to stand.

The grounds of appeal are inelegantly crafted, they are repetitive and lack clarity and conciseness required by the Rules.

Be that as it may, only two issues for determination on appeal arise from them. They are:

1....,.

2. Whether the appellants had locus standi....,.

WHETHER THE APPELLANTS HAD LOCUS STANDI

The appellants sought rescission of judgment on the basis that it was induced by fraud and that they should have been consulted before any compromise was reached between the Government of Zimbabwe and the first respondent.

Their interest in the land, so they contended, lay in the sense that the land had long been acquired by the State, in 2001, and allocated to them about 2004.

According to the appellants, the first respondent had lost any rights in the land upon its acquisition in 2001, with the rights in the land having been transferred to them by the Government.

They asserted that the first respondent misled both the Government and the court a quo into believing that there existed agreements between it and the appellants when no such agreements were concluded.

A distinction must be drawn between locus standi to seek a rescission of judgment in terms of Rule 449 and the right to overturn a Deed of Settlement concluded between the Government of Zimbabwe and the first respondent.

In my view, the former is a procedural issue which can be determined on the preliminary arguments made before the court a quo. On the other hand, the latter is a substantive issue going to the merits of the case.

I entertain no doubt that any party affected by the judgment of the court, even when not cited in the proceedings, has locus standi to bring an application for the rescission of the judgement granted in its absence.

That is the furthest one can go.

As to whether, having made the application for rescission of judgment, the appellants made a case for such rescission, that is an issue going to the merits of the application and not locus standi to litigate.

In finding that the appellants had no locus standi to rescind the agreement the court a quo was deciding the merits of the case.

It was unnecessary to do so having upheld the other points taken in limine.

Our finding in that regard, however, does not assist the appellants in this appeal given that the upholding of the other points in limine by the court a quo cannot be faulted.

Regarding the question of the acquisition of the land, this court settled the issue of the legal effect of a section 5 Notice not pursued after being gazetted in the case of TBIC Investments (Pvt) Ltd & Anor v Mangenje & Ors SC13-18.

In that case, this Court stated that the effect of section 16B(2)(a) of the former Constitution, providing that all identified agricultural land vested in the State was to revive, resuscitate, and validate the acquisition of all identified agricultural land listed in the 7th Schedule of the then Constitution.

At p7 of the cyclostyled judgment BHUNU JA, writing for the court, stated:

“The language used in section 16(2) of the former Constitution is clear and unambiguous admitting no ambivalent interpretation. The only meaning to be ascribed to the section is that once land is gazetted and listed in Schedule 7 it automatically stands acquired by the State with full title by operation of law. The mere fact that the notice was at one time withdrawn or expired is irrelevant.”

That the land in question was acquired by the State in 2001 does not advance the appellants' appeal in any way. This is because the case was determined on preliminary points raised by the first respondent and not on the merits.

Even the contestation of the agreements allegedly concluded by the first respondent with individual occupiers did not yield any positive results for the appellants.

The first respondent presented evidence, in its opposing affidavit, which the court a quo accepted, to the effect that it had concluded agreements with the individual occupiers of the land for them to pay for it directly to the first respondent.

This may have annoyed the co-operative societies as they would have wanted the money paid to them.

Their annoyance, however, is of no moment in the administration of justice.

The finding made by the court a quo, that no fraud was proved, was a factual one based on its acceptance that indeed agreements had been made with the individual occupiers.

It is well settled that an Appellate Court will only interfere with the factual findings of the lower court where the decision is irrational to the extent that no sensible court could have made it.

That view was repeated in Shuro v Chiuraise SC20-19…, where the following passage appears:

“It is an established tenet of our law that an Appellate Court should be slow in interfering with the factual findings made by a lower court and that this should happen only where it is clear that the decision of the lower court is irrational, in the sense that no sensible court, seized with the same facts, could have reached such a conclusion…,.

In short, an Appellate Court can only interfere with the findings of a lower tribunal where it is convinced that the findings by the lower court are not supported by the evidence or are otherwise irrational: see Hama v National Railways of Zimbabwe 1996 (1) ZLR 664 (S).”

It has not been shown that the findings of the court a quo are irrational or that they are not supported by evidence.

Quite to the contrary, the court a quo considered the evidence and found no fraud as it certainly was not there. No basis for interference has been established....,.

Clearly, this is a case of disgruntled illegal land occupiers who are frustrated by the decision taken by the Government to intervene and restore order and sanity in the allocation of land for urban settlement.

There is no basis in law for reversing the lawful acquisition of land, and the agreement as to compensation, which resulted in the consent order sought to be impugned.

HB01-15 : MARIA RABEKA vs LARISSA STOCKIL and ASSISTANT MASTER OF THE HIGH COURT and REGISTRAR OF DEEDS N.O.
Ruled By: MAKONESE J

Section 18(1) of the Wills Act [Chapter 6:06]..., provides as follows:“Effect of subsequent birth, legitimation or adoption of children on Will(1) If, after a testator has made a Will -(a) A child is born, of whom the testator is the mother or, the child being legitimate, the father; or(b) An ...

Section 18(1) of the Wills Act [Chapter 6:06]..., provides as follows:

“Effect of subsequent birth, legitimation or adoption of children on Will

(1) If, after a testator has made a Will -

(a) A child is born, of whom the testator is the mother or, the child being legitimate, the father; or

(b) An illegitimate child of the testator is legitimated or, in accordance with customary law, is legitimated or otherwise acknowledged or recognised as a child of its father; or

(c) The testator adopts a child in accordance with the law relating to adoption;
then, unless the Will makes some other provision for the child or unless it clearly appears that the testator intended otherwise, the child shall be entitled to the following benefits from the testator's estate –

(i) If the Will makes no provision for any child of the testator, the child shall be entitled to any benefit that he would have received if the testator had died intestate; or

(ii) If the Will makes provision for any other child or children of the testator, the child shall be entitled to the same benefits as, or to benefits of equivalent value to those that are receivable under the Will by –

A. The other child or children, where there is only one such other or where the Will treats all such other children equally; or

B. The other child or other children, as the case may be, who receive the benefits of smallest value, where the Will treats the other such children differently.

2. The benefits payable in terms of this section to a child referred to in paragraph 9(a), (b) or (c) of subsection (1) shall be deemed to be –

(a) A legacy payable under the Will concerned, if the Will makes no provision for any child of the testator or if the Will provides for a legacy to be paid to each other such child or to the child who receives the benefits of smallest value, as the case may be:”

The applicant has made the bald allegation that all the five children were fathered by the late Manuel Arthur Da Silva without providing any evidence save that two of the children, namely, Trent Da Silva and Eliza Da Silva have birth certificates in which their last name is recorded as Da Silva.

As provided in section 18(1) of the Wills Act, an illegitimate child can only be entitled to benefit from the testator's estate where that illegitimate child of the testator is legitimated.

It is now settled law that the fact that the father's name appears on the child's certificate does not mean that the father has any rights of guardianship or custody.

Needless to say, that, the fact that the father's name appears on the child's birth certificate does not have the effect of legitimating the child: see the case of Katedza v Chunga and Others HC50/03.

The applicant did not attempt to explain how the children born out of the union with the late Manuel Arthur Da Silva were legitimated.

It ought to be noted, that, in terms of our law, the natural father may adopt the child or make application for guardianship under the Guardianship of Minors Act [Chapter 5:08].

In casu, notwithstanding the fact that the late Manuel Arthur Da Silva may have maintained the children he had with the applicant, and that two of the children's birth certificates bear the surname of their father, there is no indication that the late Manuel Arthur Da Silva undertook to take any lawful steps recognized under our law to legitimate the children.

I am satisfied that on the facts presented by the parties, the applicant's illegitimate children have not been legitimated for the purposes of section 18(1) of the Wills Act.

View Appeal
SC61-21 : COSMA CHIANGWA vs DAVID KATERERE and ROBERT CAMPBELL LOGAN and ISRAEL GUMUNYU and REGISTRAR OF DEEDS and EDMOND CHIVHINGE and MASTER OF THE HIGH COURT
Ruled By: BHUNU JA, MATHONSI JA and CHITAKUNYE AJA

This is an appeal against the whole judgment of the High Court (“the court a quo”) handed down on 15 June 2011 wherein the court a quo granted an application for a declaratur that the sale and transfer of Stand 382 Good Hope Township to the appellant was null and ...

FACTUAL BACKGROUND

The matter before the court a quo was a court application for a declaration of the sale and registration of Stand 382 Good Hope Township of Subdivision B of Good Hope into the appellant's name as being null and void.

In November 1999, the first respondent entered into an agreement of sale in terms of which he purchased an immovable property, namely, Stand 382 Good Hope Township of subdivision B of Good Hope, from the estate of the late Johanna Maria Francisca Logan as represented by the executrix testamentary of the estate.

The immovable property was transferred to the first respondent on 2 April 2007 by virtue of Deed of Transfer number 1597/2007.

On 1 October 2006, one Tsungirai Musenha and the appellant, represented by the third respondent, filed an application in the Magistrates Court, in Case No.12060/06, citing Robert Adrian Campbell-Logan, estate late Maria Johana Campbell-Logan, and the Registrar of Deeds as respondents.

They alleged therein that the second respondent had sold to them and they had purchased Stand Numbers 412 and 382 Good Hope Township of Subdivision B of Good Hope.

On 5 October 2006, a rule nisi was granted by the Magistrate's Court, interdicting the three (3) respondents and all those acting through them from disposing or transferring to anyone Stand Numbers 412 and 382 respectively being subdivisions of the remainder of subdivision B of Good Hope held under Deed Number 6180/95 pending the return date.

The return date was, however, not stated in the order.

On 29 November 2006, the sixth respondent issued Letters of Administration appointing the third respondent as executor dative to administer the estate of the late Maria Johanna Francisca Campbell-Logan, for the sole purpose of effecting transfer of Stand Number 382 into the name of Cosma Chiangwa, (the appellant herein).

On 4 July 2007, Stand 382 was transferred into the name of the appellant by Deed of Transfer 4079/2007.

This prompted the application in the court a quo wherein the first respondent sought an order that the sale, registration, and transfer of the property in question to the appellant be declared null and void; that the appointment of the third respondent as executor dative of the estate of the late Maria Johanna Francisca Campbell-Logan be declared null and void; and that the first respondent be declared the sole owner of the property in question....,.

The appellant..., contended that the first respondent had no real rights over the property in question and that the Registrar of Deeds had confirmed, by letter, that the property belongs to him....,.

Section 10 of the Deeds Registries Act [Chapter 20:05] provides that:

“10 When registration takes place

(1) Deeds executed or attested by a registrar shall be deemed to be registered upon the affixing of the registrar's signature thereto:

Provided that no such deed which is one of a batch of interdependent deeds, intended for registration together, shall be deemed to be registered until all the deeds of the batch have been signed by the registrar.

(2) If, by inadvertence, the registrar's signature has not been affixed to a deed at the time at which the signature should have been affixed in the ordinary course, the registrar may affix his signature thereto when the omission is discovered, and the deed shall thereupon be deemed to have been registered at the time at which the signature should have been affixed.

(3) All endorsements or entries made on title deeds or in registers in connexion with the registration of any deed executed or attested by a registrar shall be deemed to have been effected simultaneously with the registration of such deed, although in fact they may have been made subsequent thereto.”…,.

By virtue of this section, the first respondent's title was deemed to have been registered on 2 April 2007 under transfer number 1597/2007 when the registrar affixed his signature.

Section 11 of the Deeds Registries Act further provides for deeds to follow sequence of their relative causes in these words:

“(1) Save as otherwise provided in this Act or as directed by the court —

(a) Transfers of land and cessions of real rights therein shall follow the sequence of the successive transactions in pursuance of which they are made, and, if made in pursuance of testamentary disposition or intestate succession, they shall follow the sequence in which the right to ownership or other real right in the land accrued to the persons successively becoming vested with such right;

(b) It shall not be lawful to depart from any such sequence in recording in any deeds registry any change in the ownership in such land or of such real right unless the registrar is satisfied that the circumstances are exceptional and has consented to such departure:”…,.

From the foregoing, it was clear that the first respondent's registration of title preceded the appellant's....,.

Unfortunately for the appellant, sections 10 and 11 of the Deeds Registries Act protected the first respondent's position as the Registrar had affixed his signature on 2 April 2007.

HH11-09 : THE MASTER OF THE HIGH COURT vs SITHANDIZILE DHLAMINI MOYO (as executor dative of Estate Late Willas Moyo) and GERTRUDE MOYO and SITHEMBISO KUSODZA
Ruled By: GUVAVA J

This is an application by the Master of the High Court for the removal of the first respondent as executor of the estate of the late Willas Mukati Moyo. The application has been filed in terms of section 117 of the Administration of Estates Act [Chapter 6:01] (“the Act”).

The facts upon which the applicant bases this application are as follows:

The respondents are the surviving spouses of the late Willas Mukati Moyo (the deceased). The estate was registered with the Assistant Master in Gweru by the first respondent. She received a Certificate of Authority from the Assistant Master, dated 15 June 2006, which empowered her to withdraw the balance which was in a Kingdom bank Account belonging to the deceased. She was also authorized to take transfer of a residential Stand known as Photo Studio, Stand Number 822 Gweru Township and a Mazda B1800 Registration Number 352-551G.

Following the registration of the estate, the applicant received complaints that the first respondent was benefiting in the estate to the exclusion of the other beneficiaries.

It was also common cause that the first respondent was operating a lodge as a business on the property and was receiving all the proceeds from the business for her own use.

There was also a complaint that she was disposing of the deceased's movable assets.

The applicant, on 31 August 2007, called a meeting at his office in order to resolve the dispute.

Following this meeting, the applicant decided that the first respondent should be removed as executor and approached this court, by way of chamber application, in accordance with the provisions of section 117 of the Administration of Estates Act....,.

On the merits, the first respondent denies, that, at the time of the deceased's death, the second and third respondents were still married to the deceased. She states that the second respondent left the matrimonial home in 1993 and the third respondent in 1998. They did not attend the deceased's funeral and it was only after the estate was registered that she was approached by the respondents with proof of their existing marriages. She thus submits that her conduct is above reproach.

She further states, that, her appointment was carried out by the Assistant Master in accordance with the Administration of Estates Act, and, thus, there is no basis for this application.

The first respondent also states, that, the business of the lodge, which is being conducted on the premises, was established by her after the death of the deceased. She states that she established the business on her own in order to maintain herself following the death of the deceased. She denied that she had disposed of any movable property of the estate. She further denied that she was benefiting from the estate to the exclusion of the other beneficiaries. She further states that the only dispute between her and the second and third respondents is over her vacation of the matrimonial home and her removal as executor of the deceased's estate....,.

I now turn to the merits of this matter.

Section 117 of the Administration of Estates Act [Chapter 6:01] provides as follows:

“117 Master may apply for removal of executor, tutor or curator from office

(1) The Master may apply to a judge in chambers for the removal of an executor, tutor or curator from his office on the ground -

(a) That he was not qualified for appointment to such office or that his appointment was for any other reason illegal; or

(b) That he has failed to perform satisfactorily any duty or requirement imposed upon him by or in terms of any law; or

(c) That he is mentally or physically incapable of performing satisfactorily his duties; or

(d) That, in his opinion, such person is no longer suitable to hold such office;
and the judge may, upon such application, remove the executor, tutor or curator concerned from his office or make such other order as he sees fit.

(2) Where an executor, tutor or curator has been removed from his office, the Master shall revoke any letters of administration or confirmation, as the case may be, which have been granted to such person.”

It seems to me, that, in order for an application in terms of this provision to succeed, the applicant must establish that it falls under any one of the grounds set out in subsection (1).

In the case of Van Nierkerk NO v Master of the High Court 1996 (2) ZLR 105, the court was faced with a similar application and the court held that the removal of an executor should never be undertaken lightly. The court held, further, that, in order to justify a removal in terms of this section, the court must be satisfied that the executor had failed to perform satisfactorily any duty or requirement imposed on him by or in terms of the law.

The applicant, in this case, did not state, in his application or heads of argument, the grounds upon which he relied for the removal of the executor.

Whilst it is not fatal to the application, as it can be ascertained from the facts in the founding affidavit, I would think that it is desirable to do so.

During the hearing however, counsel for the applicant submitted that he was relying on subsection (1)(a) of the above section.

Counsel for the applicant submitted, that, the first respondent should be removed from office on the basis that her appointment was not in accordance with the law as the estate was too large to be administered summarily in terms of section 32(1) of the Administration of Estates Act.

Section 32(1) of the Administration of Estates Act provides as follows:

“(1) If any person dies whose estate is unrepresented and in so far as the same is in Zimbabwe, appear to the Master to be under the value of such amount as the Minister may specify in terms of subsection (2), the Master may -

(a) Cause such estate to be administered and distributed in accordance with by an executor dative to be by him summarily appointed for that purpose; or

(b) Dispense with the appointment of an executor dative and direct how such estate shall be administered and distributed.”

It seems to me, that, section 32(1) of the Administration of Estates Act allows the Master to deal summarily with an estate if he considers it to be a small estate. In other words, where the Master determines that the estate is a small estate, an executor is appointed without following the normal procedures incumbent upon such appointment nor is the executor required to carry out a full administration of the estate.

In this case, the Assistant Master sitting at Gweru made such an appointment.

It seems to me, however, that, in making the appointment, he failed to comply with the provisions of the Administration of Estates Act.

In deciding whether or not an estate falls within the ambit of this section, the value of the estate must be below an amount which is prescribed by the Minister from time to time by statutory instrument.

In terms of the Administration of Estates (Specified Amount) Notice 1994, published in S.I.155/94, SI155/94 the prescribed amount is $60,000. This statutory instrument has not been amended since 1994 in spite of the skyrocketing values of property in this country.

It seems to me, that, in view of the values of the property market, no estate would ever fall within the ambit of this section.

In my view, it is incumbent for the Minster to review the prescribed amount from time to time in the same manner that he reviews the value of an estate for which duty is payable.

In this way, an unnecessary burden is not placed on the Masters office, and the public, by being obliged to provide full administration in what is essentially a small estate which would not require full administration.

The estate before me involves an immovable property in the City of Gweru. It has been described as a residential property with a business of a lodge being conducted on its premises. It also involves a motor vehicle and some cash.

Whilst no value of this estate has been given in the papers before me, it is quite apparent that such an estate, as described, could not have been valued below $60,000 - even in 2006 when it was registered.

Immovable property values at that time were already in the million dollar range.

It seems to me that such an estate cannot be defined as a small estate. The Assistant Master should therefore not have proceeded in terms of section 32 of the Administration of Estates Act.

It was submitted, on behalf of the first respondent, that, at the relevant time, there was a circular from the applicant directing that all estates dealing with customary law marriages should be dealt with in terms of section 32 of the Administration of Estates Act.

Unfortunately, the circular was not placed before the court so that the court could determine the meaning of the circular for itself.

It however seems to me, that, even if such a circular does exist, it would not be in accordance with section 32 of the of the Administration of Estates Act.

The appointment of the first respondent, as executor of the estate of the late Willas Mukati Moyo, thus, in my view, was unlawful.

In the result, I make the following order:

1. The first respondent be and is hereby removed as executor dative of the Estate of the Late Willas Mukati Moyo.

2. The Certificate of Authority granted to the first respondent, on 15 July 2006, is hereby revoked.

3. That there be no order as to costs.

SC68-21 : SIBONILE DUBE vs PAUL MUREHWA and MINISTER OF LOCAL GOVERNMENT, PUBLIC WORKS AND NATIONAL HOUSING N.O.
Ruled By: GUVAVA JA, MAVANGIRA JA and KUDYA AJA

This is an appeal against the entire judgment of the High Court sitting at Harare, in which the court granted a declaratur in favour of the first respondent; asserting that he was the lawful holder of rights and interests in the property known as Stand 6401 Retreat, Waterfalls.The court also ...

FACTUAL BACKGROUND

The first respondent made an application before the court a quo seeking to be declared the bona fide holder of rights and interests in the property known as Stand number 6401 Retreat, Waterfalls (hereafter referred to as “the property”). The first respondent also sought to have all those in occupation of the property declared unlawful occupiers and to vacate the property.

The appellant opposed the application.

The first respondent submitted, that, he had joined the Joseph Chinotimba Housing Co-operative Society sometime in 2009, and had, as a member, been allocated the property. He had proceeded to dig a well on the property and to buy the necessary building materials. According to the first respondent, the appellant invaded the property sometime in 2014 claiming that it was her own and proceeded to construct a temporary structure using some of the material that he kept and stored on the property.

With regard to the appellant's claim that the property was hers, as it had been allocated to her by her own co-operative known as Samora Machel Housing Co-operative, the first respondent submitted that her co-operative had no authority to do the alleged allocation. He submitted that this was so because the second respondent (the managing authority), had written to the appellant's cooperative reiterating its consistent position that Stand numbers 6392 to 6414 (under which the property falls) had been allocated to the Joseph Chinotimba Housing Co-operative.

The first respondent further submitted, that, consistent with its position, the second respondent had entered into a lease agreement with him over the said property thereby giving him rights, interests, and title to the property.

The first respondent averred that neither the appellant nor her cooperative had any recognisable interests and rights whatsoever over the said property.

He argued that the purported allocation of the property to the appellant had no legal basis as the second respondent had confirmed that he was the only recognised holder of rights in the property.

The appellant, on the other hand, averred, that, she was allocated the same property by her co-operative, namely, the Samora Machel Co-operative, as a vacant Stand and she had proceeded to make lawful developments thereon.

She argued that there was no basis for the first respondent's application since there had already been a full trial pertaining to the same matter in the Magistrates Court wherein the first respondent had failed to prove his ownership of the property.

The appellant also submitted that there were material disputes of facts which could not be resolved on the papers and that the first respondent had therefore used the wrong procedure in filing the application.

It was the appellant's case, that, the allocation of the property to her found favour with the Apex Board which was the authority responsible for allocating land to its members, including co-operatives. According to her, the second respondent had allocated the property to the Apex Board, which, in turn, allocated the property to her.

She averred that the property had therefore been lawfully allocated to her and the first respondent was accordingly in unlawful occupation of the same.

The appellant therefore argued, that, as the allocation to her was done by her co-operative, with the blessings of the Apex Board, the allocation was above board and remained valid.

She averred that the first respondent's lease agreement was not conclusive proof of ownership and his allocation was based on an illegality.

She therefore sought to have the first respondent's application dismissed with costs.

The second respondent's then Acting Permanent Secretary deposed to an affidavit confirming that the property had been allocated to the first respondent under the Joseph Chinotimba Housing Co-operative. He confirmed that the first respondent had been issued with a lease agreement over the said property. The second respondent further confirmed that the appellant did not have a lease agreement with the Ministry, and, as such, she was an invader on the property.

His stance was therefore that the order that was sought by the first respondent ought to be granted.

THE DECISION OF THE COURT A QUO

The court a quo noted that the cause of action in the Magistrates Court had been for eviction whilst the application before it was for a declaratur.

The court found that the second respondent had made it clear that the property in issue had been allocated to the Joseph Chinotimba Housing Co-operative and had also confirmed that the first respondent had a valid lease agreement for the Stand. The court found that the first respondent had managed to establish that he had rights over the said property emanating from the lease agreement as well as correspondence and a sworn statement from the second respondent and the relevant Ministry's official.

The court a quo also noted that the appellant sought to rely on an allocation form from her co-operative - which form did not have the Ministry's letter-head or logo but only bore a stamp. The court further took into consideration the fact that the said allocation form was a 2012 document, whereas, on record, there were documents from 2014, 2016, 2017 and 2018 indicating the Ministry's position pertaining to the first respondent's co-operative and lending support to the first respondent's claim.

In the result, the court a quo declared the first respondent to be the lawful holder of rights and interests in the property. It further ordered the appellant to vacate the property and give vacant possession to the first respondent.

Aggrieved by the decision of the court a quo, the appellant noted the present appeal on the following grounds;

GROUNDS OF APPEAL

“1. The court a quo grossly erred and misdirected itself in making a finding that there were no material disputes of fact when it was apparent from the papers filed of record that there were issues which could not be resolved without hearing oral evidence.

2. The court a quo erred and grossly misdirected itself in granting the declaratur in circumstances where the first respondent had failed to prove that he had rights and disregarded overwhelming evidence which proved that the appellant had rights in the property.

3. The court a quo grossly erred and misdirected itself on relying (sic) on evidence whose authenticity and origins had been challenged given that same had not been availed at an earlier stage and whose authenticity was only going to be tested through viva voce evidence.

4. The court a quo grossly erred and misdirected itself at law in completely disregarding the decision of the Magistrates Court on the similar facts of the dispute under Case Number 101166/18 and thereby effectively overruling the factual findings of the extant judgment which is already a subject of an appeal in the High Court under Case Number CIV 25/19.

5. The court a quo grossly erred and seriously misdirected itself in failing to apply the principles of estoppel in view of the evidence placed before the court and given that the application was based on the similar set of facts and documents used in an initial litigation between the appellant and first respondent.

6. The court a quo seriously erred and misdirected itself in dismissing appellant's preliminary point to the effect that the matter and dispute between the parties was pending in the High Court under case number CIV 25/19 and further erred in granting eviction that is a subject matter of the pending appeal.”

In her prayer, the appellant prays for the appeal to be allowed with costs and for the order of the court a quo to be set aside so as to dismiss the application for a declaratur with costs on an attorney-client scale.

SUBMISSIONS BEFORE THIS COURT

At the hearing of this appeal, counsel for the first respondent raised a preliminary objection to the appellant's grounds of appeal one, two, three, and five.

He submitted that they were defective on the basis that they were not clear and concise. He therefore moved the court to strike them out.

Counsel for the appellant conceded that some of the grounds were defective and abandoned grounds two, three, five and six.

She therefore motivated the appeal only in terms of grounds of appeal one and four.

On the merits, counsel for the appellant argued, that, in the court a quo, the first respondent sought to overturn the decision of the Magistrates Court but had disguised the proceedings as stet a declaratory order.

She averred, that, the first respondent applied for a declaratur based on the same facts and evidence as had been placed before the Magistrates Court, which court found that the first respondent had not proved that he had title to the property and thus had no basis to evict the appellant.

She further averred that the court a quo erred in failing to take into account the fact that there was a pending appeal in the High Court dealing with the rights of the parties, thereby running the risk of having two conflicting judgments from the same court.

Counsel for the appellant submitted, that, by hearing the matter, the court a quo, in essence, reviewed factual findings made by the Magistrates Court; which findings were the subject of an appeal before the same court. She argued that the court a quo ought to have stopped the first respondent from litigating this matter in view of the pending appeal. Thus, the court a quo erred in granting consequential relief which was the subject of an appeal.

Counsel for the appellant also argued, that, the first respondent failed to provide sufficient evidence to prove that he had rights in the property. She averred that the first respondent relied on a lease agreement whose validity was challenged and was rejected by the Magistrates Court. She argued that due process was not followed in the issuing of the first respondent's lease agreement as it did not go through the Apex Board.

Counsel therefore submitted, that, there were material disputes of fact in relation to the allocation of the Stand which could not be resolved a quo without leading oral evidence and thus prayed for the appeal to be allowed.

Counsel for the first respondent submitted, that, there were no material disputes of fact in this matter as most of the relevant facts were clear.

He submitted, that, the first respondent has a valid lease agreement which has not been cancelled or revoked and thus remains extant. He further averred that it was an established fact that the second respondent does not recognize the appellant as the legitimate holder of rights over the property. He argued that the appellant's housing co-operative did not challenge or dispute that the first respondent's co-operative had been duly issued with the necessary authority over the property. The appellant, therefore, had no basis to challenge what her own co-operative had accepted.

It was counsel for the first respondent's argument that there were no material disputes of fact at all in the circumstances.

Counsel for the first respondent further argued, that, the present matter had not been argued in the Magistrate's Court as claimed by the appellant. He averred that the parties in the Magistrates Court matter were materially different from the parties in the present matter and that the causes of action and relief sought in the respective matters were different. In the light of these differences, counsel for the first respondent submitted, that, the court a quo's finding, that the matter before it and the one that was before the Magistrate's Court were different, cannot be faulted.

He therefore sought the dismissal of the appeal with costs on the legal practitioner and client scale.

APPLICATION OF THE LAW TO THE FACTS

Whether or not the court a quo erred by finding that there were no material disputes of fact which warranted the matter to be referred to trial

The appellant contends, that, the court a quo erred in making a finding that there were no material disputes of fact in this matter.

She avers that the issues pertaining to the validity of the lease agreement, the competing legitimate rights over the property, and the allocation of the property were disputed, and, as such, they could not be resolved through the evidence placed on record without hearing viva voce evidence.

With regard to this issue, the first enquiry is to ascertain whether or not there is a real dispute of fact which could not be resolved without hearing evidence.

In Supa Plant Investments (Pvt) Ltd v Chidavaenzi 2009 (2) ZLR 132 (H)…, MAKARAU JP…, expressed the following sentiments:

“It is my view, that, it is not the number of times a denial is made or the vehemence with which a denial is made that will create a conflict of fact such as was referred to by McNALLY J (as he then was) in Masukusa v National Foods Ltd and Another 1983 (1) ZLR 232 (H) and in all the other cases that have followed.

A material dispute of fact arises when material facts alleged by the applicant are disputed and traversed by the respondent in such a manner as to leave the court with no ready answer to the dispute between the parties in the absence of further evidence.”

In the case of Eddies Pfugari (Pvt) Ltd v Knowe Residents Association & Anor SC37-09, in assessing whether the court a quo erred in resolving the disputes raised on the papers without hearing evidence, this Court stated the following:

“The position is now well established, that: in motion proceedings, a court should endeavour to resolve the dispute raised in affidavits without the hearing of evidence. It must take a robust and common sense approach and not an over fastidious one; always provided that it is convinced, that, there is no real possibility of any resolution doing an injustice to the other party concerned.”

In Muzanenhamo v Officer in Charge CID Law and Order & Ors CC03-13, PATEL JA…, stated as follows:

“As a general rule, in motion proceedings, the courts are enjoined to take a robust and common sense approach to disputes of fact and to resolve the issues at hand despite the apparent conflict. The prime consideration is the possibility of deciding the matter on the papers without causing injustice to either party.”

In casu, I am in no doubt that the court a quo was correct in resolving the matter on the papers.

The position is now well established, as reflected by the case authorities, that, not every dispute of fact in motion proceedings must be sent for trial. A material dispute of fact, it has been stated “arises when material facts alleged by the applicant are disputed and traversed by the respondent in such a manner as to leave the court with no ready answer to the dispute between the parties in the absence of further evidence.”

The court a quo found, that, there were no material disputes of fact in this matter because the facts that the appellant sought to rely on were based on the findings of the Magistrates Court where the cause of action before the court had been for eviction whilst the application before it was for a declaratur.

The learned Judge in the court a quo noted that:

“The first respondent sought very much to rely on what had transpired in the Magistrates Court where a claim for eviction had been raised by the applicant. The first respondent seeks to say that the allocation of Stands should have been done through the Apex Board hence the lease was not properly issued.

What is before me is a valid lease, it has not been indicated that the lease itself is not valid.

The complaints raised by the first respondent emanate from agreements between the Apex Board and the other entity where the parties had agreed on the modus operandi pertaining to the allocation of those particular Stands.”

I am also of the view, that, sufficient facts were established by way of affidavits and relevant documentary evidence to establish, on a balance of probabilities, that, the first respondent was the legitimate holder of real rights in the property.

A valid lease agreement was furnished. The lease agreement had not been cancelled and it remains operative. Furthermore, the first respondent also produced affidavits from the second respondent, who is the authority responsible for the management of State land.

The said documents verified and confirmed that the first respondent was the legitimate and recognised holder of rights to the property. His entitlement to the property was thereby established.

The appellant's contentions, that there were material disputes of fact, based as they were on bare denials that were not supported by any documents, were thus of no avail to her case.

The law is clear, that, bald and unsubstantiated allegations do not establish a litigant's purported or announced position: see Akhtar v Min of Public Commission SC173-97.

The court a quo's decision cannot therefore be faulted because the evidence placed before it established, on a balance of probabilities, that, the first respondent had rights emanating from the lease agreement with the second respondent whilst the appellant only made bare allegations which were not sufficient to prove the existence of any material disputes of facts.

In the circumstances, the appellant's first ground of appeal lacks merit and is hereby dismissed.

Whether or not the court a quo erred in granting the declaratur

It is the appellant's case that the matter before the Magistrates Court was based on the same evidence placed before the court a quo. She avers that the court a quo erred in granting the declaratur in a situation where that matter was subject to an appeal in the same court. She avers that there is therefore a possibility of having two conflicting decisions in the same matter emanating from the same court.

The appellant further averred that the lease relied on by the first respondent was not valid and for that reason the court misdirected itself when it declared the first respondent as the lawful holder of rights over the property when in fact it was the appellant who had an agreement with the Apex Board which was the allocating authority of the said property.

The court a quo found that the first respondent's case was more probable than the appellant's.

It is settled in our jurisdiction that the standard of proof in civil matters is “a balance of probabilities.”

In ZESA v Dera 1998 (1) ZLR 500 the court held, that, in a civil case, the standard of proof is never anything other than proof on the balance of probabilities. It stated that the reason for the difference in onus between civil and criminal cases is that in the former the dispute is between individuals, where both sides are equally interested parties. The primary concern is to do justice to each party, and the test for that justice is to balance their competing claims. McNALLY JA stated…,:

“So, in a criminal case, one is primarily concerned with doing justice to the accused. In a civil case, one is concerned to do justice to each party. Each party has a right to justice, and so the test for that justice has to balance their competing claims. Hence the 'balance of probability' test.”

In Bruce N.O. v Josiah Parkers and Sons Ltd 1972 (1) SA 68 (R)…, proof on a balance of probabilities was interpreted in the following manner:

“It must carry a reasonable degree of probability but not so high as required in a criminal case. If the evidence is such that the tribunal can say 'we think it more probable than not' the burden is discharged; but, if the probabilities are equal, it is not.”

See also Milner v Minister of Pensions 1947 2 All ER 372…, and Thulisani Dube Nyamambi v Bongani Ncube HB82-15.

In casu, the first respondent produced as Annexure C, a valid lease agreement between him and the second respondent. It was signed by the first respondent on 16 June 2016 and by the second respondent's representative on 27 September 2016.

It is significant, that, the second respondent, through its then Acting Permanent Secretary, filed an affidavit. He indicated therein, that, according to the second respondent's records, in 2008, the Ministry, through the office of the resident Minister, allocated blocks of Stands to about 28 housing co-operatives at Retreat Farm. Stand 6401 is within the range of the block of Stands 6392-6414 which was allocated to the Joseph Chinotimba Co-operative Society. The said block of Stands was never allocated to the Samora Machel Housing Co-operative.

He further stated that there was an agreement between the second respondent and the Housing Co-operatives that each respective co-operative would recommend to the second respondent beneficiaries who were paid up in terms of land servicing fees so that lease agreements could be issued to them. The Joseph Chinotimba Housing Co-operative, being the co-operative to which the above mentioned block of Stands was legitimately issued, recommended, on 15 August 2013, that a lease be issued to the first respondent. The Samora Machel Housing Co-operative never had the right to, neither did it recommend a beneficiary to the property, as the Stand had never been allocated to it.

The Acting Permanent Secretary further categorically stated that the appellant does not have a lease agreement with the second respondent and is in fact an invader on the property.

The said allocation of the property on 15 August 2013 is backed by Annexure A1, a document of even date on the letterhead of the Joseph Chinotimba Housing Co-operative Society. Payments made by the first respondent are reflected on Annexure A2, a membership card on which are reflected monthly payments for the period spanning between January 2009 and December 2014.

In addition, and in further support of the first respondent's case, is a letter from the second respondent dated 27 May 2014 and addressed to the chairman of the Samora Machel Housing Co-operative advising of complaints that had been received from the Joseph Chinotimba Housing Co-operative Society in connection with Stands 6392- 6414 Retreat Township. The letter states, inter alia:

“Please be advised that according to our records submitted by the Harare South Housing Union, stands 6392–6414 Retreat Township belong to Joseph Chinotimba Housing Co-operative, and, as such, your co-operative should leave those stands for occupation by the rightful owners from Joseph Chinotimba Housing Co-operative.”

In another letter, dated 19 December 2017, from the second respondent, addressed to “To Whom It May Concern” the second respondent categorically stated the following:

“This letter serves to confirm that PAUL MUREHWA 27-127113-l-27 has a valid lease agreement for Stand 6401 Retreat Township with the Ministry of Local Government, Public Works and National Housing. The lease agreement number is A/3823/16. Please note that he is the only recognized legal owner of the residential Stand in question.”

Yet another letter from the second respondent, dated 21 June 2018, and addressed to the chairman of the Joseph Chinotimba Housing Co-operative pertinently states as follows:

“RE: REQUEST FOR OFFICIAL POSITION OF LEASE AGREEMENT: JOSEPH CHINOTIMBA HOUSING CO-OPERATIVE SOCIETY: RETREAT TOWNSHIP

Please be advised, that, according to the land management policy for State land, when a co-operative is offered a piece of land, the co-operative, in turn, recommends its members to the State land office for lease processing on individual Stands once the member has fulfilled the co-operative's requirements. The Lease document is thus a legal document which is entered into between Government and the co-operative beneficiary who should enjoy vacant possession of the Stand upon being allocated.

The Lease Agreement is the one which will eventually be used to process the title deed for the Stand in favour of the lessee. In addition, the Lease Agreement is also required when building plans are being submitted for approval to the relevant Local Authority.

For all the lessees who have paid the full purchase price, the Government is now awaiting completion of construction of buildings so that we can process title in favour of the beneficiaries. Please note that no other person is allowed on the Stand except the one who has a Lease Agreement with the Ministry.”…,.

On the other hand, the appellant sought to rely on an allocation form issued by her co-operative - but this was not sufficient evidence to prove her entitlement to the property and particularly so in the face of all the evidence furnished by the first respondent in support of his case. The documents that the appellant sought to rely on did not bear the second respondent's logo and these documents could not further the appellant's case.

The court a quo rightly noted that the appellant sought to rely on what had happened in the Magistrates Court, where the proceedings had been for eviction, yet the application before it was for a declaratur.

On the evidence that was placed before it, with particular reference to the valid lease agreement between the first and second respondents, the court could not have arrived at any other conclusion other than that the first respondent had real rights to the property in question.

The court a quo further noted, that, the second respondent had made it clear that the property in question had been allocated to the Joseph Chinotimba Housing Co-operative, which was the co-operative that the first respondent belonged to. In fact, the second respondent, through the Resident Minister, had allocated the block of Stands 6392 to 6414 to the Joseph Chinotimba Housing Co-operative. The Stand that was allocated to the first respondent fell within the said block. The property in question, being the Stand that was allocated to the first respondent by his co-operative, had not been allocated to the Samora Machel Housing Co-operative to which the appellant belonged. Furthermore, the Apex Board, which the appellant sought to rely on as the allocating authority, did not have the power to supersede the authority of the second respondent, which was the ultimate authority over the land.

It is settled that this Court will not easily interfere with factual findings made by a lower court unless there has been such a gross misdirection by that court on the facts so as to amount to a misdirection in law, in the sense that no reasonable tribunal applying its mind to the same facts would have arrived at the conclusion reached by the lower court: Chioza v Siziba SC16-11.

In assessing whether the court a quo misdirected itself in finding that the first respondent had rights to the property, regard may be had to the case of Reserve Bank of Zimbabwe v Granger & Anor SC34-01, wherein this Court stated the following:

“An appeal to this Court is based on the record. If it is to be related to the facts there must be an allegation that there has been a misdirection on the facts which is so unreasonable that no sensible person who applied his mind to the facts would have arrived at such a decision. And a misdirection of facts is either a failure to appreciate a fact at all or a finding of fact that is contrary to the evidence actually presented.”

In Barros & Anor v Chimphonda 1999 (1) ZLR 58 (S)…, the court stated the following:

“These grounds are firmly entrenched. It is not enough that the Appellate Court considers that if it had been in the position of the primary court it would have taken a different course. It must appear that some error has been made in exercising the discretion. If the primary court acts upon a wrong principle; if it allows extraneous or irrelevant matters to guide or affect it; if it mistakes the facts; if it does not take into account some relevant consideration; then, its determination should be reviewed and the Appellate Court may exercise its own discretion in substitution provided always it has the materials for so doing. In short, this Court is not imbued with the same broad discretion as was enjoyed by the trial court.”

DISPOSITION

In casu, the question therefore relates to whether or not the court misdirected itself in granting a declaratur in favour of the first respondent.

In the circumstances of this case, the decision of the court a quo, to declare, on a balance of probabilities, that the first respondent was the legitimate holder of rights in the property, cannot be impugned. This Court has therefore found no basis on which to interfere with the decision of the court a quo.

This appeal is without merit. On the question of costs, I see no reason for departing from the rule that costs follow the cause.

It is accordingly dismissed with costs.

Appealed
SC82-21 : TRIANGLE LIMITED and HIPPO VALLEY ESTATES LIMITED vs ZIMBABWE REVENUE AUTHORITY and OTHERS
Ruled By: GWAUNZA DCJ, MATHONSI JA and CHITAKUNYE AJA

This is an appeal against the judgment of the High Court sitting at Masvingo, delivered on 24 June 2020, which dismissed with costs the application made by the two appellants for a declaratory order and an interdict.FACTUAL BACKGROUNDThe two appellants are sugar-producing giants in the Lowveld while the first respondent ...

FACTUAL BACKGROUND

The two appellants are sugar-producing giants in the Lowveld while the first respondent (Zimbabwe Revenue Authority) is the statutory body charged with revenue collection in Zimbabwe. The remainder of the respondents are either sugar cane farmers or associations representing such farmers (Zimbabwe Sugarcane Development Association, Zimbabwe Cane Farmers Association, Mkwasine Sugarcane Farmers Trust, Commercial Sugarcane Farmers Association of Zimbabwe, Hippo Valley Productive Farmers Association, Zimbabwe Sugarcane Development Association Royal Trust, Chipiwa Mpapa Mill Group, Chiredzi Productive Cane Growers, Farai Dumo Augustine Musikavanhu and Roy Bhila).

The respondents will be referred to in this judgment, for convenience, as Zimbabwe Revenue Authority and the farmers respectively.

The appellants and the farmers entered into two types of agreements, either a “Cane Milling Agreement” or a “Cane Purchase Agreement” in terms of which the appellants would either provide milling services to the farmers and market their sugar and molasses or outrightly purchase the sugar cane.

The dispute which arose between the parties did not involve the outright purchase and sale of sugar cane. As such this judgment does not deal with that scenario at all. The judgment concerns itself with the cane milling agreements entered into between the parties.

In terms of the cane milling agreements, the charge for milling and marketing services, payable by the farmers to the appellants, was calculated in terms of a pre-determined ratio referred to as the “Division of Proceeds” (DoP) ratio. It was fixed at 23 percent of the proceeds the farmers would get; meaning that, the appellants would retain 23 percent of the proceeds while remitting the balance of 77 percent to the farmers.

Regrettably, in fixing the milling and marketing charge, the appellants did not include Value Added Tax (VAT) as required by law. It follows, that, no Value Added Tax was paid by the appellants to the Zimbabwe Revenue Authority in that regard.

It was in the process of auditing the appellants Value Added Tax (VAT) assessments for the period 2009 to 2017 that the Zimbabwe Revenue Authority decided that the milling and marketing charges of 23 percent of the proceeds levied by the appellants against the farmers attracted VAT.

The Zimbabwe Revenue Authority proceeded to issue assessments of value added tax (VAT) for those years and demanded payment of same from the appellants. These assessments related to the past supplies where the appellants ought to have, but failed, to collect and remit VAT to the Zimbabwe Revenue Authority.

The appellants objected to the assessments which objections were all disallowed by the Zimbabwe Revenue Authority. The appellants appealed to the Fiscal Appeals Court but paid the assessed value added tax (VAT) to the Zimbabwe Revenue Authority notwithstanding.

An appeal does not exonerate a tax payer from paying the assessed tax.

After effecting payments to the Zimbabwe Revenue Authority, the appellants sought to recover such value added tax (VAT) from the farmers on the basis that they were obliged to charge and collect the VAT from the consumers of the service, the farmers, but had not done so.

The appellants were of the view, that, it was only fair and reasonable that the farmers should re-imburse them of the value added tax (VAT) paid by them to the Zimbabwe Revenue Authority.

There being no convergence between the farmers, who had obtained advice from the Zimbabwe Revenue Authority, that, the 23 percent Division of Proceeds ratio was inclusive of value added tax (VAT), and the appellants, the latter filed an application in the court a quo.

In their application, the appellants sought declaratory relief that they were legally entitled to continue charging and collecting value added tax (VAT) from the farmers - over and above the 23 percent milling charge.

The appellants also sought to be reimbursed the monies they paid to the Zimbabwe Revenue Authority on past assessments.

In addition, they accused the Zimbabwe Revenue Authority of interfering with contractual issues between them and the farmers by rendering advice to the farmers on the value added tax (VAT) dispute.

Accordingly, the appellants sought an order interdicting the Zimbabwe Revenue Authority from what they called “gratuitously interfering in pricing and contractual issues” between them and the farmers.

The application was opposed by the Zimbabwe Revenue Authority and most of the respondents.

DECISION A QUO

It was the view of the court a quo, that, the entire dispute revolved around the interpretation of section 69 and section 72 of the Value Added Tax Act [Chapter 23:12].

Regarding the past supplies of sugar cane to the appellants, the court a quo found, that, the literal meaning of section 69 of the Value Added Tax Act suggests, that, it is irrelevant whether the registered operator has charged VAT or not. If the price does not reflect the tax component, section 69 of the Value Added Tax Act operates such that there is a presumption that a price not reflecting VAT included that tax.

It was the finding of the court a quo, that, the section serves to “estop” a registered operator, who has not reflected value added tax (VAT) on the price, from denying that the price includes that tax.

It also found, that, section 69 of the Value Added Tax Act precludes such registered operator from subsequently claiming VAT not reflected on the price.

In the court a quo's view, permitting the appellants to recoup value added tax (VAT) in retrospect would render nugatory the deeming provision of section 69 of the Value Added Tax Act as the deeming provision cannot be interpreted to mean different things to two different people.

Regarding the claim for value added tax (VAT) on present and future supplies of sugarcane, which the contracts of the parties are still silent on, the court a quo took the view, that, it was up to the parties to re-negotiate or clarify the terms of their contracts in order to plug the existing lacunae.

If they do not, then, section 69 of the Value Added Tax Act will continue to apply.

The court a quo was not persuaded that a case was made for an interdict against the first respondent.

It recognised, that, the appellants had made a formal request to the first respondent to intervene and educate the farmers on the tax implications of their agreement. They could not, thereafter, cry foul after such intervention.

In addition, the court a quo found no evidence of the first respondent's interference with the pricing issues between the appellants and the farmers.

On the question of costs, the court a quo found no basis for departing from the general rule, that, costs follow the result. It dismissed the application with costs granted in favour of only those respondents who participated in the suit.

The appellants were aggrieved. They noted this appeal to this Court on the following grounds;

GROUNDS OF APPEAL

1. The learned judge of the court a quo erred and misdirected himself in finding that section 69 of the Value Added Tax Act [Chapter 23:12] operated to preclude the appellants from recovering value added tax (VAT) for past supplies on an alleged milling service which the first respondent considered to have been rendered to farmers.

2. Further, the court a quo erred and misdirected itself in failing to pronounce, definitively, on the appellants right and entitlement to charge, levy, and collect value added tax (VAT), and the farmers respective obligation to pay same, in addition to the value of the alleged milling service, with respect to current and future supplies pursuant to the first respondent's decision to impose tax.

3. The learned Judge of the court a quo erred and misdirected himself in failing to find, that, the letter by the first respondent to the farmers, with respect to the farmers tax obligations, strayed upon purely contractual matters which it was not competent for the first respondent to prescribe to parties.

4. The court a quo erred in awarding costs against the appellants, and in favour of the respondents in general, and, at any rate, most especially as it relates to the second (Zimbabwe Sugar Cane Development Association), fifth (Commercial Sugar Cane Farmers Association of Zimbabwe), seventh (Zimbabwe Sugar Cane Development Association Royal Trust), eighth (Chipiwa Mpapa Mill Group), and tenth (Farai Dumo Augustine Musikavanhu) respondents in particular.

ISSUES

The grounds of appeal may be four, but they speak to essentially two narrow issues for determination in this appeal. They are:

1. Whether or not the court a quo erred in refusing to grant the declaratur and the interdict.

2. Whether or not the court a quo erred in granting costs against the appellants.

SUBMISSIONS ON APPEAL

Counsel for the appellants anchored his arguments on the legal effects of the decision taken by the first respondent, contained in its letter dated 9 September 2019. Following meetings held by the parties, the first respondent determined that:

“1. The VAT Act, under section 6, provides that VAT shall be charged and levied where a service is provided. Facts at hand indicated that millers provide milling services to the farmers and they retain 23% from the sugar proceeds…,.

Given the above legislative requirements, VAT is therefore applicable on the milling fees, and, as discussed in the meeting, VAT is recovered as depicted in the following scenario…,.”

It was submitted, that, the moment the first respondent made the decision to commence recovering value added tax (VAT) on milling services, when, prior to that, it had not done so, the provisions of section 72(1) of the Value Added Tax Act [Chapter 23:12] were triggered.

The section provides:

“(1) Whenever the value added tax is imposed or increased in respect of any supply of goods or services in relation to which any agreement was entered into by the acceptance of an offer made before the tax was imposed or increased, as the case may be, the registered operator may, unless agreed to the contrary in any agreement in writing and notwithstanding anything to the contrary contained in any law, recover from the recipient, as an addition to the amounts payable by the recipient to the registered operator, a sum equal to any amount payable by the registered operator by way of the said tax on increase, as the case may be, and any amount so recoverable by the registered operator shall, whether it is recovered or not, be accounted for by the registered operator under this Act as part of the consideration in respect of the said supply.”

To the extent that value added tax (VAT) was only imposed on the milling fees, by letter quoted above, so the argument goes, when it had not been claimed previously, the appellants were entitled to recover it from the recipients of the milling services by virtue of that provision.

It was submitted, further, that, the deeming provisions of section 69 of the Value Added Tax Act do not preclude the appellants from recovering the value added tax (VAT) paid to the first respondent. This is so because the section is a shield in the hands of the revenue collector. It is an administrative tool for the facilitation of easy collection of taxes without disruptive disputes with registered operators.

In counsel for the appellants view, section 69 of the Value Added Tax Act cannot be used to estop the operator from recovering value added tax (VAT) paid to the collector.

Per contra, counsel for the first respondent submitted, that, given that the contracts for milling services did not reflect value added tax (VAT), section 69 of the of the Value Added Tax Act applies. To that extent, in respect of past supplies, the contract price is deemed to be inclusive of VAT.

It was submitted further, that, in the absence of an agreement with the farmers to vary the contract price, even by the application of basic principles of Contract Law, the appellants could not unilaterally vary the price by levying value added tax (VAT).

On the effects of section 72 of the Value Added Tax Act, it was submitted, that, the section may be regarded as a law–changing provision. In the event that the law changes to include value added tax (VAT), where it was not applicable, so it was argued, or to increase the applicable VAT, then, by dint of section 72 of the Value Added Tax Act, the agreement is varied accordingly.

The net effect of those submissions is that the section has no application where value added tax (VAT) was excluded in the agreement when it should have been included.

Regarding the alleged interference with contractual rights and obligations by the first respondent, counsel for the first respondent submitted, that, the advice rendered by the first respondent was not only at the invitation of the appellants themselves but also in fulfilment of a statutory obligation. The first respondent is obliged to educate taxpayers on their tax obligations.

The requirements for an interdict were not met.

Counsel for the rest of the respondents in attendance, in chorus, associated themselves with submissions made on behalf of the first respondent....,.

Counsel for the appellants did not prosecute the issue of the interdict sought against the first respondent with any degree of enthusiasm.

It is not without reason that this is so:

(a) Firstly, evidence placed before the court a quo shows, that, the appellants invited the first respondent to intervene and educate the farmers on the tax implications of their contracts with the appellants. That the first respondent interpreted their contracts in a manner not favourable to the appellants can scarcely found a cause of action.

(b) Secondly, and more importantly, the requirements for the grant of an interdict were not met.

I can only advert to the fact that the court a quo made factual findings relating to the failure by the appellants to prove that the first respondent had interfered with the contractual issues.

It also made a finding that the advice rendered by the first respondent was only confined to value added tax (VAT) matters falling within the statutory province of the first respondent as a revenue collector.

Surely, one cannot be interdicted from carrying out a lawful duty.

The court a quo also made a finding that the use of the term “gratuitously interfering” was too imprecise and unenforceable.

On appeal, the appellants failed to set out a basis for interference with those findings.

It is trite, that, it is only where the factual findings of the lower court are clearly irrational, to an extent that no sensible court seized with the same facts could have reached such a conclusion, that the Appellate Court will interfere: see Hama v National Railways of Zimbabwe 1996 (1) ZLR 664 (S); Shuro v Chiuraise SC20-19.

No such threshold was attained in the present case. As such, this Court cannot interfere.

View Appeal
HMA28-20 : TRIANGLE LIMITED and HIPPO VALLEY ESTATES vs ZIMBABWE REVENUE AUTHORITY and OTHERS
Ruled By: ZISENGWE J

The parties in this application are embroiled in a bitter dispute over the implications of their failure to specifically include Value Added Tax (abbreviated herein as “VAT”) matters in agreements for the milling of sugarcane.

The applicants are both companies duly incorporated in terms of the laws of Zimbabwe whose names over the years have become synonymous with sugar and sugar cane production in Zimbabwe. They grow, source, and mill sugar-cane and market its products. They carry on this agro-based business in and around the Lowveld towns of Triangle and Chiredzi.

The first respondent is the Zimbabwe Revenue Authority (ZIMRA): a statutory body whose chief mandate is to assess, collect, and enforce the payment of all revenues on behalf of the State. It is established in terms of the Revenue Authority Act [Chapter 23:11].

Save for the 10th (Farai Dumo Augustine Musikavanhu) and 11th (Roy Bhila), the rest of the respondents are organisations representing the interests of sugarcane farmers in the Lowveld (Zimbabwe Sugar Cane Development Association, Zimbabwe Cane Farmers Association, Mkwasine Sugar Cane Farmers Trust, Commercial Sugar Cane Farmers Association of Zimbabwe, Hippo Valley Productive Farmers Association, Zimbabwe Sugar Cane Development Association Royal Trust, Chipiwa Mpapa Mill Group and Chiredzi Productive Cane Growers Association).

The 10th (Farai Dumo Augustine Musikavanhu) and 11th (Roy Bhila) respondents are individual sugar cane farmers.

They were probably singled out on account of the positions they hold as Members of Parliament for the Chiredzi South and Chiredzi North constituencies respectively over and above their roles as sugar-cane farmers. They also occupy and serve in specialised Parliamentary capacities.

BACKGROUND

Solely for purposes of convenience and brevity, the second to eleventh respondents (Zimbabwe Sugar Cane Development Association, Zimbabwe Cane Farmers Association, Mkwasine Sugarcane Farmers Trust, Commercial Sugarcane Farmers Association of Zimbabwe, Hippo Valley Productive Farmers Association, Zimbabwe Sugarcane Development Association Royal Trust, Chipiwa Mpapa Mill Group, Chiredzi Productive Cane Growers Association, Farai Dumo Augustine Musikavanhu and Roy Bhila) will be referred to simply as “the farmers” and the first respondent as “ZIMRA”.

It is common cause, that, pursuant to the terms of either of two types of written agreements between them, the farmers supply the sugar cane that they produce to the applicants. These contracts are generally referred to by the parties as the “Cane Milling Agreement” and the “Cane Purchase Agreement.”

Under the former, the basic idea (as is implicit in the name) is that the applicants merely provide a milling service to the farmers. In addition, the applicants also proceed to market, on behalf of the farmers, the sugar and molasses thereby produced as well as other by-products, and, thereafter, remit to the farmers the proceeds thereof after deducting the expenses associated with the milling of the sugarcane and marketing of the sugar and the other by-products.

It is further common cause, that, under the cane milling arrangement, there is an existing agreement that the charge for the milling is calculated according to a pre-determined ratio referred to as the “Division of Proceeds” (DoP) ratio. This ratio currently stands at 23 percent of the proceeds which the applicants retain in the wake of the marketing of the products of the milling process. The farmer gets the remainder.

The Cane Purchase Agreement operates differently.

According to the parties, this agreement involves a direct and complete sale of the sugar cane by the farmers to the applicants with risk and benefits passing to the latter upon the delivery of the cane.

During oral submissions in court, counsel for the applicants referred to a rather convoluted method by which the purchase price of the cane is computed under this arrangement; suffice it to say that there is no convergence as among the parties as to whether the supplies of cane that gave rise to the current dispute constitute a Cane Milling Agreement or a Cane Purchase Agreement.

Be that as it may, it is common cause, that, in a decision (which has since been appealed against to the Fiscal Appeals Court), the first respondent determined that the set-up which currently obtains, chiefly characterised by the distribution of proceeds arrangement, constitutes one which attracts value added tax (VAT).

Therein lies the genesis of the dispute.

This is because the simple question to be answered is whether the 23 percent retained by the applicants, post the milling and marketing, incorporates value added tax (VAT) (as contended by the farmers) or it does not (as maintained by the applicants).

It is further common cause that the Zimbabwe Revenue Authority (ZIMRA), having made the decision that the aforementioned arrangement was one that attracts value added tax (VAT) in terms of the law, and that the applicants were therefore legally obligated to have, all along, charged and collected from the consumers (i.e. the farmers) and remitted the amounts so collected to it, directed that the said amounts be paid to it.

In compliance with that decision, the applicants aver, that, they have since calculated the outstanding amounts in this regard and remitted the same to the first respondent.

Through the current application, the applicants seek;

(i) A declaratory order to the effect that they are legally entitled to recover from the farmers the value added tax (VAT) which they have since paid to the first respondent; and

(ii) Secondly, that they are legally entitled to continue charging and collecting value added tax (VAT) from the farmers over and above the 23 percent milling charge.

The applicants also take exception to the fact that the first respondent (through some of its officials) took it upon itself to render certain advice to the farmers which advice they contend amounts to an unwarranted interference in matters that are purely contractual.

Part of that advice related to the first respondent's interpretation of the tax implications of the failure to include value added tax (VAT) matters in the cane supply agreements.

The terms of the declaratur sought by the applicants are captured in the draft order annexed to the application which reads:

“Wherefore, after reading papers filed of record and hearing counsel, IT IS ORDERED THAT:

1. The application succeeds with costs.

2. It be and is hereby declared that -

(a) The conduct by the first respondent to give advice to the applicants and the second to eleventh respondents on what are purely contractual matters is ultra vires its functions and responsibilities as an administrative authority and therefore unlawful.

(b) To the extent that they are liable to pay VAT for milling costs, the applicants are entitled to charge, levy, and collect such VAT in accordance with the VAT Act on and in addition to the value for the milling charge.

3. The first respondent be and is hereby ordered and directed to refrain from gratuitously interfering in pricing and contractual issues between the applicants and the second to eleventh respondents.

4. The respondents shall, jointly and severally, the one paying the others to be absolved, pay the applicants costs of suit on an attorney–client scale.”

The applicants raised a number of arguments in support of their contention that they should be permitted to recover that which they have since paid to the Zimbabwe Revenue Authority (ZIMRA) in the wake of the latter's aforementioned determination.

The main thrust of their argument, as I see it, however, is that the very fact that the Act makes it clear that the burden to pay the tax in question rests on the consumers, who in this case are the farmers, yet it was them (applicants) who were compelled to pay it, necessarily implies that they can recover the same from the farmers.

Reliance was placed, inter alia, on the elucidation by GOWORA JA, of the tripartite relationship in the value added tax (VAT) equation. This was in the case of ZIMRA v Packers International (Private) Limited SC28-16 where the following exposition was made:

“The system of collection of VAT, as embodied in the VAT Act, involves the imposition of tax at each step along the chain of manufacture of goods or the provision of services subject to VAT;”

And further that:

“…, tax under the VAT Act consists of monies that have been taxed on goods and services paid by consumers for onward transmission to the Commissioner. All that is required of an operator is to calculate the amount so paid, submit a return, and make payment.”

Flowing from this basic premise, according to the applicants, are two applicable precepts that emanate therefrom, namely, unjust enrichment and equity.

The latter, though not specifically pleaded in their papers, was nevertheless amply canvassed during the oral submissions in court.

Regarding unjust enrichment, it was averred, that, should the court not find in the applicants favour, an injustice will ensue in that the respondents will have been unjustly enriched at their expense.

For the requirements and application of the principle of unjust enrichment, the following cases were cited as authority; Industrial Equity v Walker 1996 (1) ZLR 269 (H); Chioza A.M. v Siziba S.W. SC04-15; and Trojan Nickel Mine Ltd v Reserve Bank of Zimbabwe HH169-13.

It was contended, that, the facts of this case point to the fact that all the pre-requisites for a finding for the applicant on the basis of unjust enrichment have been met.

The nub of the equity argument is that justice and fairness simply demand that the applicants be allowed to recoup from the farmers that which they paid to the Zimbabwe Revenue Authority (ZIMRA) in compliance with the latter's determination.

It is clear that this is merely an extension or adjunct of the unjust enrichment contention.

The applicants further referred to various sections of the Act which, in their view, fortify their position. Reliance was placed in this regard to section 9(2) which provides as follows:

“The value placed on any supply of goods or services shall, save as is otherwise provided in this section, be the value of the consideration for such supply, as determined in accordance with subsection 3, less so much of such value as represents tax: Provided that -

(a)…,.;

(b) Where the portion of the value of the said consideration which represents tax is not accounted for separately by the registered operator, the said portion shall be deemed to be an amount equal to the tax fraction of that consideration.”

Similarly, reliance was placed on section 9(5) of the Act which provides:

“Where goods or services are deemed to be supplied by a registered operator in terms of subsection (2) or (8) of section 7, the supply shall be deemed to be made for a consideration in money equal to the lesser of -

(a) The cost to the registered operator of the acquisition, manufacture, assembly, construction, or production of goods or services, including -

(i) Any tax charged in respect of the supply to the registered operator of such goods or services or of any components, materials, or services utilised by him in such manufacture, assembly, construction or production;

(ii) Where such goods or any right referred to in subsection (2) of section seven, when held by the registered operator, constituted trading stock as defined in section 2 of the Taxes Act, any further costs, including tax incurred by him in respect of such goods or right;

(iii) Any costs, including tax, incurred by the registered operator in respect of the transportation or delivery of such goods or the provision of such services in connection with the transfer of such goods or the provision of such services as contemplated in subsection (8) of section seven; and

(iv) Where such goods or services were acquired under a supply in respect of which the consideration in money was in terms of subsection (4) of this section deemed to be the open market value of the supply or would in terms of that provision have been deemed to be the open market value of the supply were it not for the fact that the recipient would have been entitled under subsection (3) of section fifteen to make a deduction of the full amount of tax in respect of that supply, such open market value to the extent that it exceeds the consideration in money for that supply: or

(b) The open market value of such supply.”

THE POSITION OF THE RESPONDENTS

The third (Zimbabwe Cane Farmers Association) and fourth (Mkwasine Sugar Cane Farmers Trust) respondents did not ultimately participate in the proceedings on account of the fact that the former did not file any opposing papers and the latter filed its heads of argument outside the prescribed time and was therefore barred.

In a similar vein, there was no appearance by or on behalf of the sixth (Hippo Valley Productive Farmers Association), ninth (Chiredzi Productive Cane Growers Association) and eleventh (Roy Bhila) respondents on the day of the hearing.

Effectively, therefore, only the positions of the first (Zimbabwe Revenue Authority), second (Zimbabwe Sugar Cane Development Association), fifth (Commercial Sugar Cane Farmers Association of Zimbabwe), seventh (Zimbabwe Sugar Cane Development Association Royal Trust), eighth (Chipiwa Mpapa Mill Group), and tenth (Farai Dumo Augustine Musikavanhu) respondents were before the court.

ZIMBABWE REVENUE AUTHORITY's POSITION (ZIMRA)

Regarding the implications of the failure by the applicants and the farmers to specifically incorporate value added tax (VAT) matters in their Division of Proceeds (DoP) arrangements, ZIMRA articulated two distinct positions, namely;

(i) That which relates to past supplies of cane; and

(ii) That which attends to present and future supplies of cane.

In respect of past supplies of sugarcane, the Zimbabwe Revenue Authority (ZIMRA) averred that a proper construction of section 69 of the Value Added Tax Act shows, that, in the absence of the express mention of value added tax (VAT) component in any price for goods or services, then the price will be deemed to contain the said tax.

As far as the alleged impropriety of the advice it rendered to the farmers, it contended that whatever advice it gave to the farmers was not only within its legal powers to give but also that it did so at the behest of the applicants.

It further averred, that, it has a duty to provide education to taxpayers not only to impart knowledge of the same but also to inculcate and engender a spirit of compliance.

First (ZIMRA) respondent's position on VAT implications for present and future supplies of cane

In its papers opposing this application, the Zimbabwe Revenue Authority (ZIMRA) does not commit itself on what the tax implications in respect of present and future supplies are. It opted, instead, to confine itself to the question of past supplies.

However, it soon became apparent that its position is that the applicants are not only at liberty to charge, levy, and collect from the farmers the said tax, but that they are in fact obligated to do so.

It suffices, however, to note that this does not address the issue of whether this will be over and above the 23 percent being charged for the milling of the cane.

THE FARMERS POSITION

As earlier stated, only the positions of the second (Zimbabwe Sugar Cane Development Association), fifth (Commercial Sugar Cane Farmers Association of Zimbabwe), seventh (Zimbabwe Sugar Cane Development Association Royal Trust), eighth (Chipiwa Mpapa Mill Group), and tenth (Farai Dumo Augustine Musikavanhu) respondents were effectively before court.

Save for a few instances of divergence (which will be highlighted below) the farmers were united not only in their resistance to the application but also on the grounds thereof.

The rallying point in their opposition to the quest by the applicants to recover the tax for past supplies was section 69 of the Value Added Tax Act. Their position essentially mirrors that of the Zimbabwe Revenue Authority (ZIMRA).

Over and above the import of section 69 of the Value Added Tax Act, however, a few additional arguments were presented to buttress their position and these are:

1. The very fact that the Zimbabwe Revenue Authority (ZIMRA) has determined that the 23 percent milling charge includes value added tax (VAT) as far as the second (Zimbabwe Sugar Cane Development Association), eighth (Chipiwa Mpapa Mill Group) and tenth (Farai Dumo Augustine Musikavanhu) respondents are concerned, is dispositive of the whole dispute.

They go as far as contending that the decision of ZIMRA is binding.

They further assert, that, in their view, the applicants have merely abdicated from their responsibility to remit the value added tax (VAT) so collected to ZIMRA and the consequences attendant thereto cannot be visited on them.

2. That the endeavour, on the part of the applicants, to recover the value added tax (VAT) they paid from them amounts to an attempt to vary the implied terms of their contract.

3. That, as far as the fifth (Commercial Sugar Cane Farmers Association of Zimbabwe) respondent is concerned, its cane supply arrangement with the applicants is governed by neither a cane milling agreement nor a cane purchase agreement, but, rather, by what it terms a “memorandum of understanding.” A copy of which was attached.

4. A further point raised by the fifth respondent (Commercial Sugar Cane Farmers Association of Zimbabwe) was that the very fact that invoices relating to disbursements of the individual farmer's share of proceeds is silent on the collection of value added tax (VAT) necessarily implies that VAT was included in the 23 percent milling charge.

During oral addresses in court, yet another argument was presented, namely, that, the Division of Proceeds (DoP) ratio was decided upon by the Minister responsible for the superintendence of the sugar sector, namely, the Minister of Industry and Commerce.

It was averred, in this regard, that, during the negotiations leading up to those figures (of 23 percent and 77 percent) it was in the contemplation of the parties that value added tax (VAT) was incorporated in the 23 percent milling charge.

In apparent departure from the positions held by the other respondents, the seventh respondent (Zimbabwe Sugar Cane Development Association Royal Trust) maintained that section 69 of the Value Added Tax Act applies to all supplies of cane; past, present, and future.

THE ISSUES

In my view, there are two broad issues up for determination in this dispute, and, from each, two sub-questions arise. The two broad questions are:

(1) Whether the 23 percent cane milling charge includes or excludes value added tax (VAT); and

(2) Whether there has been an unjustifiable interference by the first respondent the Zimbabwe Revenue Authority (ZIMRA) in purely contractual matters between the applicants and the farmers.

The sub-questions in respect of (1) above are:

(a) Whether or not the applicants are entitled to recover from the farmers value added tax (VAT) which they (i.e. applicants) paid to ZIMRA for past supplies; and

(b) Whether or not the applicants are entitled to charge, levy, and collect from the farmers value added tax (VAT) over and above the 23 percent milling charge.

The sub-questions from (2) above are:

(a) Whether the applicants have satisfied the requirements for the declaratur sought in paragraph 2(a) of the draft order; and

(b) Whether the applicants have satisfied the requirements for the interdict sought in paragraph 3 of the draft order....,.

Untenable is the argument advanced on behalf of the second (Zimbabwe Sugar Cane Development Association), eighth (Chipiwa Mpapa Mill Group) and tenth (Farai Dumo Augustine Musikavanhu) respondents that the very fact that ZIMRA has deemed that the 23 percent milling charge as being inclusive of value added tax (VAT) is determinative of the issue.

The Zimbabwe Revenue Authority (ZIMRA), as with any other individual or entity is bound by the provisions of the law (in this case the Value Added Tax Act). Its interpretation of its provisions is also subject to judicial review. The court is still enjoined to determine the correctness or otherwise of that interpretation....,.

WHETHER THE 23% CANE MILLING CHARGE INCLUDES OR EXCLUDES VALUE ADDED TAX (VAT)

This is arguably the most significant question as it lies at the very heart of the dispute.

As indicated above, the applicants used various arguments in support of their contention that the 23 percent milling charge must be taken as excluding value added tax (VAT).

They relied, inter alia, on subsections 2 and 5 of section 9 of the Value Added Tax Act.

I however fail to see how section 9(2)(b) of the Value Added Tax Act assists the applicants.

Section 9 of the Value Added Tax Act, in general, is aimed at the determination of the value of supply of goods or services. Paragraph 2(b), in particular, is a proviso to the general provision that the value to be placed on any supply of goods or services is the value of the consideration.

This proviso however addresses a situation where the registered operator neglects to separately account for the value of the consideration which represents tax in which case it will be deemed to be the tax fraction of the consideration.

Implicit in this proviso is that the tax fraction is to be calculated from that consideration: not in addition to the consideration. A fraction of something is a piece, part, portion, or component of something. Put in context, therefore, the tax fraction is incorporated in not excluded from or to be added to the 23 percent milling charge which is the consideration.

Sub-section (5) of section 9 of the Value Added Tax Act equally does not avail the applicants.

It is simply a method aimed at assisting in the computation of the consideration of the supply of the goods or services in question in instances of “deemed supply”. The basic idea being that this involves a calculation of all the expenses incurred in or attendant to the acquisition of the goods or services (or any lesser amount) or simply the open market value of such supply.

Needless to say that this provision does not even come close to unlocking the current legal logjam, let alone assist the applicants....,.

The real issue as I see it, lies in the interpretation of sections 69 and 72 of the Value Added Tax Act and their application to the facts of this matter....,.

REGARDING PAST SUPPLIES OF CANE

As indicated earlier, in this regard, the Zimbabwe Revenue Authority (ZIMRA) relied almost exclusively on the provisions of section 69 of the Value Added Tax Act (and the farmers adopt a similar stance) which provides as follows:

“69 Prices deemed to include tax

(1) Any price charged by the registered operator in respect of any taxable supply of goods or services, shall, for the purposes of this Act, be deemed to include any tax payable in terms of paragraph (a) of subsection (1) of section six in respect of such supply, whether or not the registered operator has included tax in such price.”

According to ZIMRA, the significance of this section is that where the price/charge (which, in this case, the milling price which is pegged at 23 percent of the value of the proceeds from the cane) is silent on the value added tax (VAT) component thereof, it is deemed, ex lege that VAT is included in that price.

Put in perspective, therefore, according to the first respondent, the Zimbabwe Revenue Authority (ZIMRA), it is deemed that the consumer of the goods or service (in this case the farmer) has already paid value added tax (VAT) in that price, and, by logical extension, all the registered operator (in this case the applicants) needs to do is to remit it to ZIMRA.

Any purported attempt to recover the same from the consumer is untenable because that would not only amount to taxing the consumer twice but also runs contrary to the tenor and spirit of that section.

The Zimbabwe Revenue Authority (ZIMRA) further contended, that, doing so would inevitably lead to a fresh computation of the value added tax (VAT) payable because the one calculated and subsequently paid by the applicants was on the basis of section 69 of the Value Added Tax Act.

In a nutshell, accepting the position adopted by the applicants would yield higher figures for the value added tax (VAT) payable.

The applicants took a contrary view and argued;

(i) Firstly, that there is no need to resort to the deeming provision of any legislation when in fact the issue in question is adequately provided for elsewhere in that Act.

This is because, so the argument goes, it should only be resorted to in instances of omission on the part of a party with the duty to comply with a statutory obligation.

(ii) Secondly, they contended that section 69 of the Value Added Tax Act only serves to remove as a potential defence in situations such as the present when ZIMRA demands from it the value added tax (VAT) component of any price where same is not expressly stated therein.

However, according to them, it offers no sanctuary to a consumer when the registered operator now seeks to recover from him (i.e. consumer) that which they paid pursuant to ZIMRA's decision.

In my view, the position adopted by the applicants cannot be sustained.

Firstly section 9(2) and section 9(5) of the Value Added Tax Act, which they relied on, have already been found to be of no application to the current dispute.

Secondly, the plain and literal meaning of the section suggests that it is irrelevant whether or not the registered operator has in fact charged the tax in question; where the price does not reflect the tax component thereof it is presumed that the tax is incorporated in that price.

In other words, the phrase “whether or not the registered operator has included tax in such price” operates a twin blow to the registered operator: it serves to estop him from denying that the price in reality did not include tax in a bid to avoid accounting for the tax to the Commissioner. At the same time, it precludes him from purporting to claim from the consumer the tax that he may or may not have collected from the consumer.

The question of who bears the obligation under the Value Added Tax Act to pay the tax (who is obviously the consumer), which the applicants expended so much effort on, is hardly the issue.

To contend that section 69 of the Value Added Tax Act should be construed so as to permit the registered operator to pursue the consumer for the recovery of the tax they paid to the Zimbabwe Revenue Authority (ZIMRA) would, in my view, run contrary to the clear intention of the legislature.

The legislature must obviously have been alive to the fact, that, in most day to day supply of goods and services, the customer disappears without trace soon after the transaction.

How then would the registered operator be able to recoup the tax that he claims he did not in fact charge and collect?

Even if the customer could be traced, there would be an unnecessary proliferation of disputes between him and the registered operator as to whether the price included value added tax (VAT) or not.

It would create unnecessary uncertainty and confusion in the market place where the consumer will never know whether or not the price charged includes value added tax (VAT) and where he always runs the risk of being informed ex post facto that the price he paid actually did not include tax.

If the applicants are permitted to recover the tax in question from the farmers then the deeming provision will be rendered nugatory. It would mean the price cannot then be deemed to include tax - it is as simple as that.

Further, related to the above, the deeming provision cannot be interpreted to mean two different things to two different people.

The interpretation that the applicants want to foist on section 69 of the Value Added Tax Act will result in a mathematical or accounting incongruence and an absurdity in logic.

The Zimbabwe Revenue Authority (ZIMRA), in its papers, vividly illustrate the mathematical inconsistency that will arise when they juxtapose the outcomes of the two contrasting positions using the hypothetical figure of $1,000 as proceeds for the sale of sugar thus:

(a) Where section 69 of the Value Added Tax Act is invoked

Proceeds from sale of sugar = $1,000
Price for milling services at 23% of the proceeds = ($1,000 x 23%) = $230
VAT due after deeming that that price includes VAT = ($230 x 15/115) = $30

(b) Where the applicants recover the section 69 ($30) VAT from the farmers

Proceeds from sale of sugar = $1,000
Price for milling services at 23% of the proceeds = ($1,000 x 23%) = $230
VAT due after deeming that that price includes VAT = ($230 x 15/115) = $30
VAT due after the applicants recover the $30 VAT from the farmers = 15% ($230-30+30) = $34.50

What the applicants are moving the court to accept will also yield a further absurd result in the following context:

Where, from the standpoint of the first respondent, the Zimbabwe Revenue Authority (ZIMRA), vis a vis the applicants, value added tax (VAT) is deemed to be included in the price; yet, from the standpoint of the applicants vis-a-vis the farmer, the price is deemed not to include the tax.

It could never have been the intention of the legislature to produce such an absurd or anomalous situation.

The net result of the interpretation should be uniform, consistent, and certain not only to the parties but also to other persons similarly situated.

Section 69 of the Value Added Tax Act effectively places the registered operator on guard on the consequences of his failure to specifically include in his price the value added tax (VAT) component thereof.

Viewed differently, it is the responsibility of the registered operator to ensure that value added tax (VAT) matters are addressed in his dealings with the consumer. It is not a responsibility that the registered operator jointly shares with the consumer because the duty to account to the Commissioner ultimately rests with him (i.e. Registered Operator).

There can never be a conflation of the roles, duties, and responsibilities among the various parties: the burden to pay the tax lies with the consumer (the farmer), the duty to charge, collect, and remit the tax lies with the registered operator (the applicants).

In the context of this case, whether occasioned by inadvertence, oversight, or a mis-interpretation of the nature of the contract, the consequences of the failure to specifically include the value added tax (VAT) are that VAT is deemed included in the milling price.

During the proceedings, resort was made by the applicants to section 72(1) of the Value Added Tax Act which provides as follows:

“72 Contract price or consideration may be varied according to rate of value-added tax

(1) Whenever the value added tax is imposed or increased in respect of any supply of goods or services in relation to which any agreement was entered into by the acceptance of an offer made before the tax was imposed or increased, as the case may be, the registered operator may, unless agreed to the contrary in any agreement in writing and notwithstanding anything to the contrary contained in any law, recover from the recipient, as an addition to the amounts payable by the recipient to the registered operator, a sum equal to any amount payable by the registered operator by way of the said tax or increase, as the case may be, and any amount so recoverable by the registered operator shall, whether it is recovered or not, be accounted for by the registered operator under this Act as part of the consideration in respect of the said supply.”

In my view, this provision is meant to address the adjustments that may have to be made in contractual situations wherein, at the time the offer was made, there was no value added tax (VAT) imposable on that contract or it stood at a certain level; however, by the time the acceptance is made, that type of contract, by operation of the law, now attracts VAT or had been increased.

The imposition of or the increase in the value added tax (VAT) was not in the contemplation of the parties thereby necessitating an adjustment in the price.

This provision is clearly not applicable to the current dispute.

There was no imposition of a “new” tax which hitherto did not exist, nor was there an increase of the value added tax (VAT) chargeable and payable.

The parties merely failed to take into account a tax which was already in existence.

PRESENT AND FUTURE SUPPLIES OF CANE

Therefore, against the backdrop of a finding that the parties (whether through inadvertence, oversight, or mis-apprehension) failed to address value added tax (VAT) matters in their contracts, one cannot legitimately vouch for the perpetuation of the status quo.

It behoves the parties to re-negotiate or clarify the terms of their contract to plug that lacuna.

It suffices to state, that, failure to do so may very well result in section 69 of the Value Added Tax Act being continuously invoked....,.

THE DECLARATUR AND INTERDICT SOUGHT IN PARAGRAPHS (2a) AND 3 OF THE DRAFT ORDER RESPECTIVELY

The relief sought in each of the above emanates from the same alleged culpable conduct. In both instances, the applicants complain that the first respondent, the Zimbabwe Revenue Authority (ZIMRA), has, in the past, overstepped its mandate (i.e. it acted ultra vires its functions and responsibilities) and has unjustifiably (and gratuitously) interfered in matters that are purely contractual as between themselves and the farmers.

The Declaratur

In MDC v The President of the Republic of Zimbabwe & Ors HH28-07, MAKARAU JP…, on the strength of the approach by VAN DIJKHORST J, in Family Benefit Friendly Society v Commissioner for Inland Revenue and Anor 1995 (4) SA 120, summarises the factors to be considered in an application for a declaratur. She stated that the applicant or plaintiff must show that:

1. It is an interested person;

2. There is a right or obligation which becomes the object of the inquiry;

3. It is not approaching the court for what amounts to a legal opinion upon an abstract or academic matter;

4. There must be interested parties upon which the declaration will be binding;

5. Considerations of public policy favour the issuance of the declaratory.

As far as the first requirement is concerned, it can hardly be disputed that the applicants are interested persons.

To the extent that they stand to be affected by any opinion or advice rendered by the first respondent, the Zimbabwe Revenue Authority (ZIMRA), to the contracting parties in the sugar-cane supply agreements, the applicants do have an interest thereto.

The second requirement, however, poses a stern challenge to the applicants.

In MDC v The President of the Republic of Zimbabwe & Ors HH28-07, the court reviewed a number of decisions on the import of this requirement (among them Electrical Contractors Association (South Africa) and Another v Building Industries Federation (South Africa) (2) 1980 (2) SA 516 (T); Durban City Council v Association of Building Societies 1942 AD 27; and Caluza v Independent Electoral Commission and Another 2004 (1) SA 631 (Tk) and concluded as follows:

“It appears to me, from a reading of the above authorities, that, what is required to be contended is a legal right and not a factual basis upon which a right may then be founded.

In casu, all the declaratory orders do not relate to a right. Nowhere has the applicant, as a political party with the majority of opposition seats in Parliament, contended that its rights are in issue and what those rights are.

I would therefore hold, that, the declarators sought in this application are incompetent as they relate to a factual situation and not to any rights, existing or future, that the applicant has or may have.

As has been stated in the authorities, the applicant must set forth its contention as to what the alleged right is. This, the applicant has failed to do. It is not for me to speculate as to what that right is or may be.”

In my respectful view, the applicants in the present case find themselves in a similar situation.

Apart from alleging a certain factual situation as obtaining (namely, the giving of advice by the first respondent, the Zimbabwe Revenue Authority (ZIMRA), they have not asserted precisely what right they purport to have.

For that reason, the application for the declaratur in paragraph 2(a) must fail.

The Interdict

The parties sparred on the precise nature of the relief sought in paragraph 3 of the applicants draft order.

It was submitted, on behalf of the applicants, that, what they seek is in fact an interdict although they did not characterise it as such in their papers.

The requirements for an interdict are well known; they may be summarized as:

1. A clear right on the part of the applicant;

2. Actual or reasonably apprehended injury; and

3. Absence of any other remedy by which the applicant can be protected with the same results.

See Flame Lily Investments Company (Pvt) Ltd v Zimbabwe Salvage (Pvt) Ltd & Anor 1980 ZLR 378; Setlogelo v Setlogelo 1914 AD 221.

As far as the first requirement is concerned, the current application is blighted by several shortcomings:

(i) Firstly, the imprecision of the term “gratuitous interference” renders the relief sought virtually unenforceable. When does interference cross the line from 'normal' (hence acceptable) to 'gratuitous' (and therefore merits censure)?

(ii) Secondly, there is no evidence that the first respondent, the Zimbabwe Revenue Authority (ZIMRA), has interfered in the pricing issues between the applicants and the farmers.

The evidence placed during this application shows that the advice which the first respondent (ZIMRA) gave relates to value added tax (VAT) matters.

The paragraph of the letter by the first respondent, the Zimbabwe Revenue Authority (ZIMRA), which the applicants find offensive reads:

“Having gone through the report by Ernst and Young Consultants on the review of Division of Proceeds (D.o.P.) and the cane purchase agreement, I noted that the two documents are silent on tax issues. In that regard, the legislation provides that VAT is included in the 23% milling charge.”

It is clear that the advice given only related to the first respondent, the Zimbabwe Revenue Authority (ZIMRA), on value added tax (VAT) matters in view of the circumstances which the parties to the contract found themselves in.

That advice can neither be termed gratuitous nor unjustified interference.

It does not, in the least, relate to pricing.

In any event, tax issues in the context of this case can hardly be referred to as pricing (or contractual) matters - they are matters of statutory interpretation.

(iii) Thirdly, there is an email from one Bigboy Shava, acting on behalf of the second applicant, which e-mail is dated 12 June 2019, directed to the first respondent (ZIMRA), among other issues, urging the latter to essentially register and educate the farmers on the implications of its (i.e. first respondent's) tax directive (which the applicants were and still are challenging).

It was then that meetings were held on 28 August and 6 September 2019.

These meetings were followed up with the letter dated 9 September 2019.

Therefore, the applicants, having requested the first respondent, the Zimbabwe Revenue Authority (ZIMRA), to address the farmers on the tax implications of their agreement cannot turn around and cry foul and allege gratuitous interference.

In the circumstances, there can be no justification in granting the interdict sought....,.

1. The application for a declaratur, as sought in paragraph 2(a) of the draft order be and is hereby dismissed.

2....,.

3....,.

4. The application for an interdict, as sought in paragraph 3 of the draft order, be and is hereby dismissed.

HB25-15 : DORCAS MHLANGA vs BENJAMIN PHAKATSHANE
Ruled By: MUTEMA J and MOYO J

The late Addison Mhlanga was of Malawian extraction who came and naturalized himself in Zimbabwe.

He married one Dinah Ndlovu but did not have children. The two then adopted Esther Ncube (nee Nkala) as their child. Dinah Ndlovu pre-deceased Addison Mhlanga. Addison Mhlanga died intestate on 22 September 2003 at age 85 years.

He owned Stand Number 49257 otherwise known as Block 26/919 Mpopoma Township, Bulawayo.

The adopted child, Esther Ncube (nee Nkala), died on 19 November 2012 leaving three children, viz Sibonile Ncube, Zanele Ncube and Sikhangele Ncube.

At an edict meeting before the Additional Assistant Master, on 19 March 2013, Esther's relatives agreed that the respondent be appointed executor dative to administer the estate of the late Addison Mhlanga.

Apparently, the respondent is related to the late Addison Mhlanga's late wife, Dinah Ndlovu, the latter having been the respondent's maternal aunt.

Ordinarily, the sole asset of Addison Mhlanga's deceased estate, viz the Mpopoma house alluded to supra, was set to devolve upon Esther's estate, which, in turn, was set to be inherited by Esther's three daughters mentioned above.

Following an advertisement in the Chronicle Newspaper and the Government Gazette of Addison Mhlanga's estate by the respondent, the appellant, out of the blue, and having changed the surname on her birth certificate from Nkhulambe to read Mhlanga on 7 May 2013, lodged an application, on 10 May 2013, in the Magistrates Court Bulawayo to have an edict meeting for the appointment of herself as heir to Addison Mhlanga's estate claiming to be the sole surviving daughter to Addison Mhlanga.

The application was dismissed, and, dissatisfied with the outcome, the appellant lodged the current appeal before this court. Two main grounds of appeal were raised and they are these:

“1. The learned magistrate erred at law in dismissing appellant's claim when -

1.1 There was evidence to the effect that the deceased, Addison Mhlanga, disclosed, during his lifetime, that appellant was his daughter.

1.2 The appellant had a birth certificate showing that the deceased Addison Mhlanga's father (sic).

1.3 The deceased, at the time of his death, had allowed the appellant to reside at his house and she continues to do so now.

1.4 The now deceased, Esther Nkala, did not reside at the said house – 26/919 Mpopoma, Bulawayo after the death of Addison Mhlanga.

1.5 Appellant's lobola was paid to the deceased, Addison Mhlanga, during his lifetime.

2. The learned magistrate also erred at law in accepting, that, the late Esther Nkala's children were entitled to inherit from the late Addison Mhlanga's estate because Esther Nkala was his adopted daughter when no document was produced to prove that she was and had been adopted.”

The appellant's prayer is that she be declared the late Addison Mhlanga's daughter and that the late Esther Nkala's children are not entitled to inherit from the late Addison Mhlanga's estate.

I will deal with the grounds of appeal hereunder seriatum....,.

THAT APPELLANT HAD A BIRTH CERTIFICATE SHOWING ADDISON MHLANGA AS HER FATHER

This ground of appeal seemed to be the main thrust of her argument. Reliance was placed upon the provisions of section 7 of the Births and Deaths Registration Act [Chapter 5:02] which state that:

“7. Evidence of certified copy of entry in register

A document purporting to be a copy of any entry in any register certified under the hand of the Registrar-General or a registrar to be a true copy, shall, on its production by any person for the purpose of any law, be prima facie evidence in all courts of the dates and facts therein stated.”

The contention here was advanced, that, the provision quoted above is peremptory and non-compliance with it amounted to a mis-direction.

Reliance for the proposition was the case of Schierhot v Minister of Justice 1926 AD 99…, where INNES CJ spelt out the general principle governing non-compliance with statutory provisions in these words:

“It is a fundamental principle of our law, that, a thing done contrary to the direct prohibition of the law is void and of no force or effect. And the disregard of a peremptory provision in a statute is fatal to the validity of the proceedings affected.”

With respect, I consider counsel for the appellant's interpretation of the phrase 'prima facie evidence' too simplistic.

The phrase prima facie is Latin for 'at first sight' or 'sufficient to establish a fact or raise a presumption unless disproved or rebutted' or 'on first appearance but subject to further evidence or information.'

This therefore means, that, evidence which is prima facie is not absolute as contended for by counsel for the appellant.

In the instant case, there is an abundance of evidence rebutting the prima facie evidence of the appellant's birth certificate.

It is common cause, that, from her birth, the appellant, up until she attained 23 years of age, had her birth certificate bearing the surname of Nkhulambe.

She said she changed the surname to Mhlanga in 2001.

That would be after her marriage in 2000, and a year after the alleged knowledge of her paternity.

She does not tell how this change of surname was effected.

She also said because she was sharing the letters BHD with another person, this prompted her to acquire a new birth certificate on 7 May 2013 – three days prior to her filing an application in the Magistrates Court for an edict meeting to have her declared heir to Addison Mhlanga's estate on the basis that she was the sole surviving daughter.

BHD relates to birth entry number.

Section 18 of the Births and Deaths Registration Act [Chapter 5:02] deals with change of name.

Section 18(3) of the Births and Deaths Registration Act provides:

“18 Change of name in register

(3) Where the birth of a person has been registered for births and the surname of the person is changed, otherwise than by adoption, the person concerned…, may apply to the Registrar-General for the registration of the surname and the Registrar General shall, on payment of the prescribed fee, and on being satisfied that –

(a) A notarial deed, as defined in the Deeds Registries Act [Chapter 20:05], setting forth the change of surname has been registered in the Deeds Registry; and

(b) The change of surname has been advertised in the Gazette;
register the change of surname in the appropriate register for births but without deleting the original surname.

(4) Notwithstanding subsection (3), the Registrar-General may register a change of surname in the appropriate register for births but without deleting the original surname even where a notarial deed has not been registered, if he is satisfied –

(a) That the change of surname is for a lawful purpose; and

(b) That the change of surname is not being effected for purposes of fraud or misrepresentation; and

(c)…,.

(5) After the registration of a change of name under this Act, every certified copy of the entry concerned shall omit the original surname unless otherwise requested by the applicant.”

What can be gleamed from section 18 of the Births and Deaths Registration Act, as appertaining to the instant case in material respects, are the following:

1. There is no evidence adduced or furnished that the appellant ever applied to the Registrar General for change of surname. This could have been shown by a copy of such application and/or receipt for payment of the appropriate fee;

2. Even though the Registrar-General is empowered to register a change of surname where a notarial deed has not been registered, such notarial deed ought to exist to show that the same was in fact effected by a notary public.

In casu, it has not been alluded to, let alone furnished.

I did ask counsel for the appellant whether a notarial deed was ever executed and he said he did not know.

If the appellant, through her legal practitioner, does not know the fact, then, who should?

It raises eyebrows for the appellant not to have requested that her original Nkhulambe surname, which she had used till after marriage, be included in every certified copy of her birth certificate.

Over and above the foregoing, there is no proof that the appellant first changed her Nkhulambe surname in 2001 to Mhlanga except for her ipsissima verba.

This should not have been impossible to prove.

Even if that were so, it would be stretching coincidence to absurdity to hold, that, the appellant discovered that her birth certificate shared the same BHD with another person which then necessitated acquisition of the current birth certificate - some three days prior to her filing the application in the Magistrates Court for the convening of the edict meeting for her to be declared sole surviving daughter of the late Addison Mhlanga hence the sole heiress to his estate; a decade after Addison Mhlanga's death; one year after Esther Ncube (nee Nkala)'s death; and several years knowing that there existed this dispute pertaining to the estate.

The prima facie evidence of the birth certificate sought to be relied upon as proof that the appellant is the late Addison Mhlanga's biological daughter was sufficiently rebutted to hold no water.

Another insurmountable hurdle besetting the appellant's case is the legal position that a child conceived by or born of a wife during the course of her customary marriage, whether legitimate or as a result of adultery, belongs to her husband: Shumba v Shumba HB25-05.

This is in conformity with the presumption against bastardisation of a child born as a result of adultery: see Kulumo v Diyana & Ors 1944 SRN 35; Hlale v Dziyake 1938 SRN 34; Ndoro v Mapfumo 1942 SRN 166; and Elizabeth & Mzeze v Gwandibva 1941 SRN 121.

The appellant cannot therefore bastardise herself.

SC106-21 : CAIRNS FOODS LIMITED vs NETRADE MARKETING (PVT) LTD
Ruled By: MATHONSI JA, CHIWESHE JA and CHITAKUNYE JA

Alleging trademark infringement, the appellant brought an application to the High Court (the court a quo), in terms of section 9A(2) of the Trade Marks Act [Chapter 26:04] against the respondent. What was sought was an interdict against the use of the offending mark and ancillary relief.

On 23 October 2019, the court a quo handed down judgment dismissing the application with costs.

This appeal is against that whole judgement of the court a quo.

FACTUAL BACKGROUND

The appellant and the respondent are companies registered in Zimbabwe and involved in the business of producing and marketing food products. In particular, they are both in an endeavour of packaging and retailing fruit jam. On 10 October 1995, the appellant successfully registered the word “SUN” with device of various fruits under it as its trade mark for fruit jam.

The certificate of registration issued by the Registrar of Trademarks reads in part;

“The Trade Mark shown above has been registered in Part A of the Register in the name of CAIRNS FOODS LIMITED, a Zimbabwean company, of Upton Road, Ardbennie, Harare, in Class 29 under No. 1479/95 as of the 10th October 1995 in respect of jams.

Registration of this trade mark shall give no right to the exclusive use of the device of various fruits except in the precise relation and association on the representation hereon.”…,.

From then, the appellant has continued to use the mark on its package of “sun jam.”

On 9 March 2011, the respondent also successfully registered its own trademark which consists merely of the words “ROYAL SUN.” It has no fruits and sun devise accompanying it.

The respondent's own certificate of registration reads in relevant part thus;

“The Trade Mark shown above has been registered in Part A of the Register in the name of Netrade Marketing (Private) Limited, a company incorporation according to the laws of Zimbabwe whose legal address is No.23 Kenilworth Road, Newlands, Harare, Zimbabwe in Class 29 under no. 288/2011 as of the 9th March 2011 in respect of meat, fish, poultry and game, meat extracts, preserved, dried and cooked fruits and vegetables, jellies, jams, compotes, eggs, milk and milk products, edible oils and fats.

Registration of this mark shall give no right to the exclusive use of the word 'ROYAL' separately from the mark.”…,.

In its business venture, the respondent also packages and markets fruit jam.

For purposes of putting that product on the market, the respondent came up with a logo or appellation containing its trademark 'Royal Sun' with a variety of fruits under it and the words 'Mixed Fruit Jam' at the bottom of it all.

I mention, in passing, that, the said logo is not registered as part of the respondent's trade mark apart from the words “Royal Sun.” It is, however, common cause, that, its mixed fruit jam is marketed under that logo.

It is the use of the logo, together with the respondent's registered trademark 'ROYAL SUN' which irked the appellant.

PROCEEDINGS IN THE COURT A QUO

The appellant filed an application in the court a quo on 7 August 2017. The application was made in terms of section 9A(2) of the Trademarks Act [Chapter 26:04] for an interdict against what it regarded as an infringement of its trade mark by the respondent. It also sought to interdict the respondent from passing off its products as those of the appellant by the use of a trademark or words nearly resembling the appellant's trade mark registration number 1479/95.

The appellant's case was that it has been marketing its fruit jam under the word 'Sun' and the device mark for over fifty (50) years. As a result, it has secured and acquired reputation and goodwill for its sun jam. According to the appellant, the respondent started promoting and selling its fruit jam under the name 'ROYAL SUN' thereby causing confusion.

As proof of such confusion, the appellant cited a case in which one wholesaler which distributes the appellant's sun jam product mistakenly placed the respondent's royal sun jam in its catalogue promoting the appellant's sun jam. To the appellant, this was enough proof that the packaging of the two products is strikingly similar.

It is on that basis that the appellant alleged a trademark infringement.

Regarding the delict of passing-off, the appellant's case was that its 'SUN' mark is distinctive, has been in use for over fifty (50) years, and, as such, it is well known to members of the public. Having gained a lot of goodwill, which the respondent is riding on, a case of passing off was made. In the appellant's view, the use of 'ROYAL SUN' is calculated to deceive the transacting public, cause confusion and injury to the goodwill.

In opposing the application, the respondent's case was that having registered its trademark in Class 29 under number 288/2011 in respect of jams and other goods, such registration was of full force and effect. It entitled the respondent to use the registered trade mark, and, as such, it could not be interdicted from doing that which is permitted by law.

Further, the respondent insisted, that, it has been marketing a broad range of products under its 'ROYAL SUN' get up. Its goods are well recognised throughout the country. Jam was only added into the mix later as there was no desire to set up a new mark for only jam.

In any event, so the respondent argued, its mark is distinct from and cannot possibly be confused with that of the appellant as the visual get up of its mark is very distinct from and cannot possibly be confused with that of the appellant. Consumers cannot be deceived or confused.

The respondent insisted, that, there was no likelihood of confusion created in the mind of customers, because, unlike the appellant, it uses its logo on a wide range of products. The customers are very familiar with its products and know very well they do not originate from the appellant.

FINDINGS OF THE COURT A QUO

The court a quo undertook a comparison of the two marks. It found that the respondent's mark is the words 'ROYAL SUN' which extends to jams while that of the appellant is “a representation or a design.” For that reason, the court a quo reasoned;

“…, it is apparent that the parties respective trademarks are far from identical neither does the respondent's mark so nearly resemble applicant's registered trade mark as to be likely to deceive. Clearly, the applicant's mark is a design while the respondents mark are the words 'ROYAL SUN.'”

It was the court a quo's finding, that, the appellant had incorrectly pleaded “its causa” because there is no trade mark in respect of the word 'Sun' independently of the representation. In the court a quo's view, the appellant's trademark was not the word 'Sun'. What was registered as a trade mark was the representation or device and not the word 'Sun'.

The court a quo concluded, that, the appellant had failed to establish any infringement of its trademark.

Regarding passing off, the court a quo agreed with the respondent, that, the evidence of the wholesaler who mistook the respondent's royal sun jam for the appellant's sun jam could not be introduced in the answering affidavit.

It accordingly found, that, the appellant had failed to demonstrate any actionable passing off. That way, the application was dismissed with costs.

PROCEEDINGS ON APPEAL

The appellant was riled by the judgment of the court a quo and launched the present appeal on five (5) grounds, namely:

1. The court a quo erred and grossly misdirected itself in its finding that the appellant had only registered a representation or device and not the word SUN when in fact the appellant's mark consists of both the word SUN and a device/representation of fruits.

2. The court a quo erred at law in failing to consider that the dominant/distinctive feature of the appellant's mark is the word SUN and the respondent did not need to reproduce the appellant's trade mark as a whole for there to be a trademark infringement - the use of the word SUN in itself amounted to trade mark infringement.

3. The court a quo erred and grossly misdirected itself in its interpretation of the disclaimer on the appellant's mark when the appellant's claim pertained to the unauthorised use of the dominant part of its mark being the word SUN and not the representation of the fruits which was disclaimed.

4. The court a quo erred and grossly misdirected itself in its finding that the appellant had failed to prove that its mark had acquired goodwill and reputation when in fact the particulars of the reputation and goodwill were canvased in the appellant's founding affidavit and were not disputed by the respondent in its opposition.

5. The court a quo grossly misdirected itself in comparing the two logos of the appellant and the respondent when the appellant's claim was not about the respondent's logo but the use of the words Royal Sun.

These grounds of appeal zero in on one main issue for determination in this appeal: it is whether the court a quo erred and misdirected itself in making a finding that the respondent did not infringe the appellant's trademark.

Counsel for the appellant submitted, that, the court a quo misdirected itself by not applying the test used to determine the existence or otherwise of a trade-mark infringement as set out in the case authorities made available to it. Instead, so it was argued, the court a quo embarked on an unnecessary forensic examination of how the two trade marks looked like. In this process, the court a quo identified six (6) differences in the two thereby arriving at the erroneous conclusion that there was no infringement.

It was further submitted on behalf of the appellant, that, the court a quo was under the mistaken view that the word 'Sun' was not a registered trademark and concerned itself with the design accompanying that word. In counsel's view, the true nature of a trade mark goes beyond the design but encompasses the word 'Sun' as well.

Counsel for the appellant went on to submit, that, regarding passing off, all its requirements were established in this case. This was moreso regard being had that the same product marketed by the appellant under its registered trade mark, that is fruit jam, was being sold by the respondent under a confusing and deceptive banner. The appellant had shown that goodwill of its product had been acquired over a lengthy period. There was also evidence of confusion created by the respondent's use of a strikingly similar name and logo for its own jam.

Per contra, counsel for the respondent submitted, in the main, that, the respondent was not guilty of un-authorised use of a registered trade mark. Quite to the contrary, the respondent registered its own trademark and used it lawfully. Once the 'Royal Sun' trade mark was registered, the respondent was lawfully entitled to its use in its business endeavour.

It was therefore incompetent, so it was argued, for the appellant to seek to interdict the use of a registered trade mark because a court of law cannot interdict what is lawful.

Counsel for the respondent suggested, that, the appellant should have sought the remedy of the expungement of the offending trademark from the register of trade-marks. For that reason, the appeal ought to fail.

In addition, it was argued on behalf of the respondent, that, the word 'Sun' being generic in nature, cannot be subject of exclusive use unless it is used in a way that causes confusion.

According to counsel for the respondent, the appellant pleaded confusion on the part of customers when the Trade Marks Act talks of deception before an infringement could be said to exist.

In any event, there was no evidence of confusion.

It was submitted for the respondent, that, the two marks are not similar, and, as such, the notional customer cannot make a mistake between them. In counsel's view, the court a quo's decision should be upheld.

THE LAW

Perhaps the starting point in examining the law governing trademarks is the effect of registration itself.

A trademark is defined in the interpretation provision, namely, section 2 of the Trade Marks Act [Chapter 26:04] (the Act), in the following words:

“Trade mark means a mark which is used or proposed to be used in relation to goods or services for the purpose of:

(a) Indicating a connection in the course of trade between the goods or services and some person having the right either as proprietor or as a registered user to use the mark whether with or without any indication of the identity of that person; and

(b) Distinguishing the goods or services in relation to which the mark is used, or proposed to be used, from the same kind of goods or services connected in the course of trade with any other persons, but, does not include a certification mark.”…,.

In terms of section 5(4) of the Trademarks Act, the register of trade marks is prima facie evidence of any matter required or authorised by or under the Act to be entered therein.

In resolving the dispute between the parties, therefore, the contents of, and what appears in the register, is critical.

The provision governing infringements of trademarks is section 8(1) of the Trade Marks Act [Chapter 26:04] which reads;

“(1) Subject to this section and sections ten and eleven, a registered trade mark shall be infringed by any unauthorised use in the course of trade, whether as a trademark or otherwise of a mark that is identical to the registered trade mark or so nearly resembling it as is to be likely to deceive or cause confusion, where that mark is used in relation to the same or similar goods or services as those in respect of which the trade mark is registered.”…,.

Subsection (3) of section 8 makes it clear, that, the right to the use of a trade mark given by registration in Part A or Part B of the Register shall be subject to any conditions or limitations entered on the Register.

The application before the court a quo was made in terms of section 9A of the Trademarks Act. It provides for entitlement to and the nature of civil remedies for infringement in the following:

“(1) Subject to this Act, an infringement of a registered trade mark shall be actionable at the suit of the proprietor and any registered user of the mark.

(2) Subject to this Act, in any proceedings for an infringement of a registered trademark, there shall be available to the plaintiff all such remedies by way of damages, interdict, attachment, the rendering of account, the delivery of improperly marked goods or of articles used or intended to be used for marking goods or otherwise as are available in respect of the infringement of any other proprietary right.”

The provisions relating to trade mark infringement have been the subject of a number of judicial pronouncements in both this jurisdiction and South Africa. Generally, authorities are agreed, that, in infringement proceedings, what the court is required to do is to consider the notional use to which the party seeking to enforce registration puts its trademark and protect the monopoly created by the terms of registration: see Bata Ltd v Face Fashions CC & Anor 2001 (1) SA 844 (SCA).

The test for infringement was eminently stated in Plascon Evans Paints Ltd v Van Riebeeck Paints (Pty) Ltd 1984 (3) SA 623 (A)…, relied upon by counsel for the appellant in advancing the argument that there exists the likelihood of deception or confusion. The court stated:

“…, a comparison between the mark used by the defendant and the registered mark, and, having regard to the similarities and differences in the two marks, an assessment of the impact which the defendant's mark would make upon the average type of customer who would be likely to purchase the kind of goods to which the marks are applied.

The notional customer must be conceived of as a person of average intelligence, having proper eyesight and buying with ordinary caution. The marks must be viewed as they would be encountered in the market place and against the background of relevant surrounding circumstances. The marks must not only be considered side by side, but also separately…,. If each of the marks contain a main or dominant feature or idea the likely impact made by this on the mind of the customer must be taken into account.

As it has been put, marks are remembered rather by general impressions or by some significant or striking feature than by photographic recollection of the whole.”…,.

It has been accepted, that, one should not peer too closely at the mark and the alleged infringement to find similarities or differences but merely at the dominant impression given by the appearance of the mark: see Mobil Oil Zimbabwe (Pvt) Ltd v Travel Forum 1990 (1) ZLR 67; Puma AG Rudolf Dassier Sport v Global Warming (Pty) Ltd 2010 (2) SA 600 (SCA).

As for passing off, this court, quoting with approval a number of South African authorities, succinctly set out the basic principles which apply to it, in the case of Woolworth & Co (Zimbabwe) (Pvt) Ltd v The W Store & Anor 1998 (2) ZLR 402 (S)…, where GUBBAY CJ stated:

“These principles are lucidly identified, with reference to leading authorities in Caterham Car Sales & Coachworks Ltd v Birkin Cars (Pty) Ltd 1998 (3) SA 938 (SCA) where, at 947E-948B, HARMS JA said:

'The essence of an action for passing off is to protect a business against a misrepresentation of a particular kind, namely, that the business, goods, or services of the representor is that of the plaintiff or is associated therewith…,.: in other words, it protects against deception as to a trade source or to a business connection….,.

Misrepresentation of this kind can be committed only in relation to a business that has goodwill or a drawing power…,.

Goodwill is the totality of attributes that lure or entice clients, or potential clients, to support a particular business…,. The components of goodwill are many and diverse…,. Well recognised are the locality and the personality of the driving force behind the business…,.

These components are not necessarily all present in the goodwill of any particular business. The only component of goodwill of a business that can be damaged by means of a passing-off is its reputation, and, it is for this reason, that, the first requirement for a successful passing off action is proof of the relevant reputation.”

It is apparent that passing off seeks to protect a product from the deceptive tendencies of a competitor who represents its product as that of the other. As a result of such deception or misrepresentation there should be injury or damage to reputation. Therefore, proof of reputation is a pre-requisite for passing off to be established: see also Zimbabwe Gelatine (Pvt) Ltd v Cairns Foods (Pvt) Ltd 2003 (1) ZLR 352 (S)…,.

APPLICATION OF THE LAW TO THE FACTS

Earlier on, I made reference to the specific trade mark registered for protection against use by any other party by the appellant as appears on the certificate of registration issued to it by the Registrar. By virtue of the trademarks register, the mark that is registered consists of the word 'SUN' a depiction of a Sun and various fruits underneath.

It is clear from the conditions of registration endorsed on the certificate that the appellant has no right to exclusive use of the device of various fruits except when they are used in the precise relation and association on the representation embodying the entire mark.

My understanding of that condition is that, while the various fruits may be used by any other party, their combination with the word 'SUN' and/or the picture of a sun will constitute an infringement.

This is so, because, by virtue of the definition of trade mark in section 2 of the Trade Marks Act [Chapter 26:04], the mark consisting of the word 'SUN' the picture of the sun and the fruits device qualifies as the appellant's registered trademark. The acceptance of that mark, in its form, and the issuance of a certificate of registration, triggered the protection accorded to a registered proprietor by section 8(1) of the Trademarks Act.

I entertain no doubt whatsoever, that, the court a quo fell into grave error in finding that the word 'SUN' was not registered and that what was registered “was the representation or device and not the word Sun.”

In fact, such a factual finding could not possibly be made by a court applying its mind to the facts. It is so grossly unreasonable in its defiance of logic as to attract interference on appeal. It is irrational.

Having said that, it follows, that, any use of a mark which so nearly resembles that registered by the appellant or one which is likely to deceive or cause confusion constitutes an infringement which is actionable in terms of section 9A of the Trade Marks Act.

As already pointed out, the respondent registered a trademark consisting merely of the words 'Royal Sun'. It did not register a device or representation of various fruits or a combination of fruits and the words “mixed fruit jam”. Therefore, the respondent's protected mark is only 'Royal Sun' and nothing more.

More than five (5) years after registering its 'Royal Sun' trade mark, precisely in December 2016, the respondent commenced using, not just the trademark, but a combination of it and the various fruits as well as the words “Mixed Fruit Jam” to sell jam.

The effect of such invention, if that it may be called, is that the respondent commenced selling “Royal Sun mixed fruit jam” using a logo which also contains various fruits.

The question which then arises is whether that was an infringement of a trade mark as to entitle the appellant to the relief provided for by section 9A of the Trademarks Act.

I totally agree with counsel for the appellant, that, the court a quo misdirected itself by undertaking a forensic audit of the two marks.

The law does not require the court to closely peer at the mark and the offending mark to find similarities and differences.

The proper test to be applied is an assessment of the impact which the respondent's mark would have on the average customer leisurely doing shopping at a supermarket, for instance. Would such a customer likely know the difference? This is so because marks are generally remembered by their general impression and not the details the court a quo looked for.

It occurs to me, that, had the court a quo applied the proper test, it would no doubt have come to the conclusion, that, the notional customer encountering Royal Sun Mixed fruit jam with the visual get up of the mark used on the respondent's logo would be deceived or confused into believing it is that of the appellant.

Deception or confusion is a matter of first impression not an outcome of a study.

The respondent cannot, in all fairness, suggest that the use of the words 'Royal Sun' in conjunction with the various fruits and the words 'Mixed fruit jam' was a mere coincidence.

Regarding the reputation of the appellant's product, it was not disputed that it has been on the market for a lengthy period, it was well known by consumers, and has acquired reputation. The word Sun has nothing to do with fruit jam. It was already in use in that class of products when the respondent chose to deploy it for the sale of jam as well.

While no case was made for expunging the respondent's trade mark from the register, the evidence before the court a quo established both an infringement and passing off in the use of its trademark with the fruits and the words mixed fruit jam on the logo.

To that extent, the relief provided for by section 9A(2) of the Trade Marks Act, which, inter alia, is an interdict against the use of the logo and its delivery, was available and should have been afforded the appellant. I am aware that the respondent's trade mark is used in respect of other products. That is well and good, but, an infringement was established only in the category of jams.

DISPOSITION

The law protects the proprietor of a registered trade mark against the use of a mark similar to or closely resembling the proprietor's trademark.

The combination of the respondent's registered trade mark, with other objects, was actionable at the instance of the appellant.

The appellant was entitled to interdict the use of the logo because it creates a deception or confusion between the appellant's jam product and that of the respondent.

The appeal has merit and should be upheld, but, the relief to be accorded to the appellant should be limited; firstly, to jam products, and, secondly, to the offending logo and not the trademark per se.

Regarding the issue of costs, the appellant has been substantially successful. It is entitled to its costs in the usual way wherein costs follow the result.

In the result, it be and is hereby ordered as follows:

1. The appeal succeeds with costs.

2. The judgment of the court a quo is set aside and substituted with the following;

“(a) The respondent be and is hereby interdicted and restrained from infringing the applicant's Trade Mark Number 1479/95 in Class 29 by the use of a logo with a combination of the words 'ROYAL SUN' together with a device or representation of various fruits and the words 'Mixed Fruit Jam' or any other words which nearly resemble the appellant's Trademark Number 1479/95 for its jam product to deceive or cause confusion in relation to the appellant's sun jam products.

(b) The respondent be and is hereby interdicted and restrained from using any mark, trade name, label, or get up likely to result in its jam products being taken to be those of the applicant without clearly distinguishing such jam products from those of the applicant.

(c) The respondent be and is hereby interdicted from passing off its jam products as those of the applicant registered under Trade Mark Number 1479/95.

(d) The respondent shall deliver to the applicant, or the Sheriff, for destruction, all packaging, labels, posters, wrapping, advertising matter, documents and other material in its possession bearing the ROYAL SUN MIXED FRUIT JAM which resembles the applicant's registered trademark.

(e) The respondent shall bear the costs of the application.”

Appealed
SC110-21 : UPSET INVESTMENTS (PRIVATE) LIMITED vs CHITUNGWIZA MUNICIPALITY
Ruled By: GARWE JA, HLATSHWAYO JA and BHUNU JA

This is an appeal against the judgment of the High Court dismissing the appellant's claim for US$119,300 being the balance of the purchase price for a 20-tonne Hyundai Excavator sold and delivered by the appellant to the respondent.

In dismissing the appellant's claim, the court a quo upheld the respondent's counterclaim and ordered the appellant to refund US$140,000 to the respondent, being the deposit paid towards the purchase of the excavator and front-end loader.

The brief summary of the case

The facts giving rise to the claim and counterclaim are hotly contested. The brief facts of the case are that the respondent is a Municipal Council duly constituted as such in terms of the Urban Councils Act [Chapter 29:15], whereas the appellant is a company in the business of selling excavators and front-end loaders.

Sometime in 2014, the parties concluded a contract of sale of a twenty-tonne excavator. The terms of the contract are in dispute.

The appellant's claim is, that, sometime in 2014, it sold and delivered, in good working order, a refurbished 20-tonne excavator for US$209,300 at the respondent's instance and request. The purchase price was payable in instalments with an initial deposit of US$90,000 and the balance of US$119,300 payable on delivery.

The appellant's complaint is, that, despite effecting delivery at the respondent's premises, on 19 June 2014, the latter refused or neglected to pay the balance of the purchase price.

The respondent denies breaching the contract of sale as alleged or at all and has counterclaimed for a refund of the deposit it paid on account of defective performance.

Its defence is that, on 16 May 2014, it floated a tender for the purchase of a brand new twenty-tonne Tracked Excavator to the tune of US$182,000. The advertisement read:

“MUNICIPALITY OF CHITUNGWIZA TENDER NOTICE NO. 05/11

Tenders are hereby invited, in terms of section 211 of the Urban Councils Act (Chapter 29:15) from reputable and legally registered companies and institutions to provide specified brand new plant and machinery to the Municipality of Chitungwiza….,.

Supply and Provision of Specified Plant and Machinery

1. Jet Machine (high velocity clearing machine).

2. Tracked Excavator (30 tonne).

3. Front End loader (3 tonne).

Tender specifications are available at Chitungwiza Municipality Head Office.”

The appellant won the tender to supply the respondent with a brand new 20-Tonne Tracked Excavator at the cost price of US$182,000 and a brand new 3-Tonne Front End Loader at the cost price of US$105,000.

It was therefore a material term of the contract that the appellant was to deliver a brand new excavator and front end loader.

The appellant, however, in breach of contract, delivered a refurbished dysfunctional excavator.

It was also a material term of the contract that the respondent would pay US$140,000 deposit for both machinery and the balance upon delivery. The respondent paid the deposit in terms of the contract but the appellant, in breach of contract, delivered a pre-owned, dysfunctional excavator without the necessary accessories.

To date, the appellant has not delivered the brand new machinery in terms of the contract.

That being the case, the respondent counterclaimed for specific performance in terms of the contract, or, alternatively, a refund of the deposit of US$140,000 paid in anticipation of the fulfilment of the terms and conditions of the contract.

The respondent also claimed payment of damages in the sum of US$30,000 for breach of contract as well as storage charges at the rate of US$20 per day from the date of summons to the date of collection of the defective refurbished excavator.

The claims for damages and storage charges were not persisted with and are not the subject of this appeal.

Thus, the court a quo was left with only two issues for determination. The issues were defined at the pre-trial conference as follows:

“1(a) Whether or not plaintiff (appellant) should be compelled to deliver a brand new excavator.

OR ALTERNATIVELY

(b) Whether or not the defendant (respondent) is entitled to a refund of the deposit paid.

2. Whether or not the plaintiff (appellant) is entitled to payment of the outstanding amount.”

Determination of the two issues by the court a quo

Upon consideration of the evidence before it, the court a quo found, that, the appellant was guilty of breach of contract. It dismissed the appellant's claim and sustained the respondent's counter-claim. Consequently, it ordered as follows:

“In the result, I order as follows:

1. The plaintiff's claim is dismissed.

2. The plaintiff pays the defendant US$140,000, being the refund of the deposit paid by the defendant towards the purchase of the Excavator and Front End Loader.

3. The plaintiff pays to the defendant costs of suit.”

The Appeal

Aggrieved by the above order, the appellant appealed to this Court for relief on five grounds. The five grounds of appeal attack the judgment a quo basically on failure to appreciate the sufficiency of evidence and failure to apply the turquand rule in its favour.

Analysis of the Facts and the Law

It is clear right from the outset, that, the cardinal question to be answered is the validity and fulfilment of the contracts allegedly concluded by the parties. In simple terms, the court a quo had to determine whether the contract was for brand new or refurbished machinery.

The parties relied on different contracts for their competing claims.

The terms of the two contracts are incompatible and at variance with each other. The respondent relied on the tender as advertised in the Herald newspaper with a wide circulation in the area. The appellant, however, denied having responded to the notice floated in the newspaper. Its Managing Director, Darlington Chirara, testified that he responded to a different notice pinned on the notice board at the respondent's registry office. It was his testimony that the notice was a tender for the procurement of a refurbished twenty-tonne crawling excavator and a refurbished three-tonne front end loader.

The appellant's sole witness, Darlington Chirara, was however unable to verify or prove the existence of the notice he claimed to have responded to on behalf of the appellant. Under cross-examination by counsel for the respondent, this is what he had to say:

“Q. Do you have proof to show that there was such a notice?

A. I do not have any documentary evidence. I could not have removed the notice that was on the notice board because others were supposed to come and see that notice.”…,.

What the appellant said under cross examination is ample proof, that, apart from his mere say so, he has no evidence of the existence of the offer he says he accepted for the provision of refurbished second hand machinery.

It is trite, that, a valid contract is constituted by an offer and acceptance.

The appellant, by his own admission, failed to establish the existence of the tender for the provision of refurbished second hand machinery. The onus was on the appellant to establish the existence of all the essential elements of a valid contract. Failure to establish the existence of such tender, on the alleged terms and conditions, was fatal to its case as there can be no acceptance without an offer.

The respondent's version was, that, it tendered for the procurement of a brand new twenty-tonne excavator and three-tonne front end loader by floating a tender in the Herald Newspaper. After observing all the legal requirements and procedures, it awarded the appellant the tender, as amended for the acquisition of a twenty-tonne tracked excavator instead of a thirty-tonne as originally tendered. The appellant duly accepted the tender and undertook to perform the contract in accordance with the given terms and conditions.

The respondent proffered evidence of the described tender notice by producing a copy of the relevant Herald newspaper cutting. It further produced copies of the related minutes of the procurement Board duly constituted in terms of section 210 of the Urban Councils Act [Chapter 29:15]. The meeting was held at the respondent's offices on 17 September 2013. It was attended by the appellant's two directors, namely, S. Mlambo and D. Chirara, who were accompanied by its legal practitioner Mr Mucheriwesi of Mushangwe and Company Legal practitioners. The respondent was represented by its Chamber Secretary, Human Resources Manager, Deputy Finance Director of Works and a medical doctor.

The minutes of that meeting speak for themselves.

The record of proceedings captures the recommendations of the Procurement Board as follows:

“…, that the tenders for the tenders of the supply of new machinery/equipment be awarded as follows:

“1. Scotia Steel (Pvt) Limited – jet machine for US$119,113=50.

2. Upset Investments (Pvt) Ltd – Tracked Excavator, 20 tonne for US$162,000.

3. Upset Investments (Pvt) Ltd Front End Loader, 3–ton for US$105,000.”

The meeting, having been apprised of the recommendations of the Procurement Board, agreed that:

“Upset investments (is) to supply and deliver brand new equipment within 10 days after receipt of 50% deposit of the total value. Further, the Chitungwiza Municipality undertook to pay legal fees as the lawyer's invoice sic). All payments were to be made through Upset Investments lawyers, Mushangwe and Company Legal Practitioners.”…,.

The documentary evidence proffered by the respondent was corroborated in every material respect by oral evidence from four witnesses.

In its plea, in reconvention, before the court a quo, the appellant however gave the impression that it responded to an amended extended tender of the original advertised tender. It was its plea in reconvention, that, the amended tender did not require the provision of new machinery. Paragraphs 4 and 5 of its plea in reconvention read:

“Ad paragraph 4

It is denied, when plaintiff in reconvention advertised its tender, it was not won by its deadline. It was then extended and revised.

Ad paragraph 5

The defendant, in reconvention, will aver that it submitted its bid during the extension. According to the specifications, it was not a requirement that the excavator ought to be brand new. The tonnage of same was also reduced.

It affirms that the tender won by the defendant in reconvention is not the same with the one initially advertised as evidenced by the discrepancy in tonnage of the excavator.”

While the Procurement Board minutes record the amendment downsizing the weight of the excavator from 30 tonnes to 20 tonnes, there is no record of the amendment of the requirement for the provision of brand new machinery. On the other hand, the appellant contended, without proof, that it responded to a notice pinned on the respondent's notice board for the supply of refurbished second hand machinery.

It is noteworthy, that, the appellant vacillated between saying that it responded to a notice pinned on the notice board and saying that it responded to an amended tender revised notice.

Such vacillation and inconsistency undermines the appellant's case.

The appellant's assertion, that the respondent offered to buy refurbished second hand machinery is not backed up by any proof of recommendations from the Procurement Board as is required by law.

Section 210(4) of the Urban Councils Act [Chapter 29:15] requires that any procurement of goods, materials, or services be subject to recommendations of the Procurement Board. The section provides as follows:

“A municipal council shall not procure any goods, materials, or services unless its municipal procurement board has made recommendations to the council thereon and the council has considered such recommendations.”

The section is couched in peremptory terms because it constitutes a prohibition coupled with the use of the mandatory term 'shall not'.

The appellant was unable to proffer any evidence of the Procurement Board having tendered for the procurement of second hand refurbished machinery. The evidence on record shows, that, before the full Council met to adjudicate over that tender, the then Town Clerk G. Tanyanyiwa, had, fifteen days earlier, written to the appellant advising him that he had won the tender to supply second hand refurbished machinery. The letter reads:

“Date 6/07/2011
Dear Sir/ Madam

REF: SUPPLY OF REFURBISHED TWENTY TONNE CRAWLING EXCAVATOR AND 3 TONNE FRONT END LOADER

Reference is made to the above.

You have been awarded the tender to supply the municipality with the above equipment. You are required to supply the equipment within 30 days from receipt of deposit which is going to be paid within the next 2 weeks. May you treat this order with urgency since there are disease outbreaks and we would like to use the equipment to arrest the spread of disease.”

It is needless to say, that, the above letter was false and in fact misleading, because, no such tender had been awarded by the respondent at that stage.

On the basis of the summation of the evidence in this case, no fault can be laid at the learned judge a quo's door for holding that the ruling contractual terms were as advertised in the Herald newspaper. The letter by G. Tanyanyiwa was pre-emptive and patently unlawful as he had no mandate to award such tender to the appellant without authority from Council.

In dealing with the unlawful and unbecoming conduct of G. Tanyanyiwa, the learned judge a quo had this to say:

“I do not believe that a Town Clerk's actions have the power to override the provisions that is (sic) peremptory. Therefore, the letter of Mr G. Tanyanyiwa, which was written on 6 July 2011, before the full Council meeting had been held on 21 July 2011, notifying the plaintiff that it had won the tender to supply refurbished machinery is therefore of no force or consequence. It does not bind the defendant. So the contract that was purportedly entered into and between the plaintiff and the defendant, pursuant to the letter which was written by G. Tanyanyiwa, is a nullity.”

In apparent concession that the Town Clerk acted unlawfully and unprocedurally, the appellant sought to rely on the Turquand rule in an attempt to sanitise and regularise G. Tanyanyiwa's unlawful and irregular conduct.

The Turquand rule is derived from the famous British case of Royal British Bank v Turquand 1856 199 ER 886.

In that case, the directors of the respondent company could borrow on behalf of the company under a company resolution. Two directors of the company signed a bond on behalf of the company, under the company seal, without the requisite company resolution. When pressed for payment, the company objected on the basis that the directors had signed without company resolution. The court held, that, when dealing with a corporate body, parties are not bound to do more than peruse the statutes of the company: and if the power to transact is given in the statute, then, the party so contracting has the right to infer that the authority to so contract on the part of the corporation has been perfected by the necessary resolutions.

In other words, a party contracting with a company is entitled to assume that all the internal procedures have been complied with, provided the company has the power to transact.

This case can easily be distinguished from Royal British Bank v Turquand 1856 199 ER 886 on two grounds:

(a) First, the respondent, being a Municipality, was expressly prohibited by section 210(4) of the Urban Councils Act from contracting without the necessary recommendations from the Procurement Board and approval from Council.

A statutory prohibition is mandatory and binding on the parties as everyone is presumed to know the law regardless of whether one has read and understood the law.

No such statutory prohibition bound the respondent in Royal British Bank v Turquand 1856 199 ER 886.

The finding by the learned judge in the court a quo, that the unsanctioned contract to provide refurbished machinery was a legal nullity, as it was prohibited by law, is beyond reproach.

The argument, that section 210 of the Urban Councils Act constitutes internal issues unbeknown to the appellant is therefore baseless and without any foundation at law. The respondent had therefore no capacity to transact in contravention of the law.

(b) Second, the letter written to the appellant by the Town Clerk, G. Tanyanyiwa, conveying the message that the appellant had won the tender to supply the machinery was false in fact and misleading. It was written without Council authority fifteen days before the adjudication of the tender. The letter was fraudulently calculated to prejudice other bidders, and the respondent, because it was meant to abort the whole purpose of the tender to identify the most suitable bidder for the supply of the advertised new machinery.

As correctly observed by the learned judge a quo, the Turquand rule cannot override a statutory prohibition. This is for the simple reason that the rule was not designed to promote and perpetuate illegality. It is meant to protect gullible members of the public who innocently contract with company agents oblivious of their failure to observe internal procedures.

Reliance on case law where the rule was applied in our jurisdiction was therefore misplaced, because, in this case, the purported contract was void ab initio and a nullity at law on account of fraud and statutory prohibition.

View Appeal
HH100-17 : UPSET INVESTMENTS (PRIVATE) LIMITED vs CHITUNGWIZA MUNICIPALITY
Ruled By: MUREMBA J

The plaintiff issued summons claiming the following:

“(i) Payment of the sum of US$119,300 being the remaining balance of the agreed purchase price for one x 20 Tonne Hyundai Excavator, sold and delivered by the plaintiff to the defendant, at its specific instance and request.

(ii) Interest at the prescribed rate calculated from the date of delivery, being 19th of June 2014, to the date of full payment.

(iii) Costs of suit on a legal practitioner and client scale.”

In its declaration, the plaintiff averred the following:

In 2011, the parties entered into a procurement contract in which the defendant ordered one by 20 tonne hydraulic excavator from the plaintiff. The agreed purchase price was US$209,300 inclusive of VAT. The defendant was obliged to pay 50% deposit towards the purchase price. The remaining balance was payable upon delivery of the excavator.

In partial fulfilment of the agreement, the defendant paid, in instalments, the sum of US$90,000 as part deposit to the agreed purchase price.

The plaintiff accordingly delivered the excavator on 19 June 2014 which delivery was accepted. The excavator was accepted in good working order by the defendant at its premises.

The defendant has, despite demand, refused or neglected to pay the outstanding balance of US$119,300....,.

To the merits, the defendant averred, that, the plaintiff delivered a defunct Hyundai Excavator contrary to the undertaking that it made that it would deliver a new excavator. It had to incur unnecessary costs in having the excavator checked by an independent company. The defendant averred, that, it will only effect payment of the balance after delivery of a brand new and properly functioning machinery.

The defendant also made a counter claim. It averred the following:

On 16 May 2014, it advertised a Tender Notice in the Herald newspaper in terms of section 211 of the Urban Councils Act [Chapter 29:15]. The notice was inviting tenders for the supply of brand new machinery, viz:

(i) One Jet machine Chigu Velocity clearing machine.

(ii) One Tracked Excavator 30 tonne.

(iii) One Front End Loader.

On 18 July 2011, the defendant in reconvention won the tender to supply it with a 20 tonne Tracked Excavator and a 3 tonne Front End loader. It was a term of the agreement that:

(a) The defendant in reconvention would deliver a brand new excavator and a brand new front-end loader.

(b) The plaintiff in reconvention would pay the deposit of the agreed purchase price before delivery of the machinery.

(c) The plaintiff in reconvention would pay the outstanding purchase price upon delivery of the machine.

The plaintiff in reconvention paid the initial deposit to the defendant in reconvention on 29 January 2014 in the sum of US$140,000. On 19 June 2014, the defendant in reconvention delivered a dysfunctional excavator in breach of the agreement terms.

It has refused and failed to deliver a brand new machinery.

The plaintiff in reconvention has been prejudiced by the breach. The plaintiff in reconvention is entitled to specific performance of the agreed terms of the contract. Alternatively, it is entitled to restitution of US$140,000 being the deposit paid as part of the purchase price and damages for breach of contract. Consequently, it claims for:

“(a) An order compelling the defendant in reconvention to deliver brand new excavator and Frond End loader to the plaintiff in reconvention in terms of the agreement.

(b) Alternatively, an order compelling defendant in reconvention to pay the sum of US$140,000 being the deposit paid as part of the purchase price.

(c) An order compelling defendant in reconvention to pay US$30,000 as damages for breach of contract.

(d) An order compelling defendant in reconvention to pay US$20 per day from date of summons to date of collection being storage fees for the excavator.

(e) An order compelling defendant in reconvention to pay interest at the rate of 5% per annum from the date of demand to date of payment in full.

(f) Costs of suit on a legal practitioner client scale.”

The defendant in reconvention pleaded as follows to the counter-claim:

When the plaintiff in reconvention advertised its tender notice, the tender was not won by the deadline. The tender notice was then revised and extended.

It (the defendant in reconvention) submitted its bid during the extension.

According to the specifications of the re-advertised tender notice, it was not a requirement that the excavator be brand new. Even its tonnage had also been reduced. The tender that was won by the defendant in reconvention was not as per the initially advertised tender notice as evidenced by the discrepancy in tonnage of the excavator.

The defendant in reconvention averred, that, at all material times, the plaintiff in reconvention was fully aware that the excavator to be supplied would be pre-owned.

When the excavator was delivered, it was inspected by all responsible authorities and then certified to be in good working condition. The parties did not agree that the machinery to be supplied would be brand new.

The defendant in reconvention prayed for the dismissal of the counter claim with costs on a higher scale.

In its replication, the plaintiff in reconvention averred the following:

The excavator was supposed to be new. It disputes that the tender that was won by the defendant in reconvention was not the one that was initially advertised. The defendant in reconvention was paid the deposit for both the excavator and front end loader after a meeting was subsequently held. It disputes that the excavator that was delivered was in good working condition.

At the pre-trial conference, the parties agreed that the issues for trial were:

1(a) Whether or not the plaintiff should be compelled to deliver a brand new excavator; or, alternatively

1(b) Whether or not the defendant is entitled to a refund of the deposit paid.

2. Whether or not the plaintiff is entitled to payment of the outstanding amount.

To prove its case, the plaintiff led evidence from one witness, Darlington Chirara, who is its Managing Director since 2007.

His evidence was as follows:

In June 2011, he went to Chitungwiza Municipality head office chasing after his payment. At the Registry section notice board there was a tender notice asking for a refurbished 20 tonne Crawling Excavator and a 3 tonne Front End loader. Tender documents were going for US$5,000.

He went back the next day and bought the tender documents which included a tender form which was supposed to be filled in duplicate and attached to the quotation. He filled in the tender form for the excavator and attached it to his quotation and had them stamped by the defendant's registry section on 9 June 2011 on receipt.

The tender document, together with the tender form and the quotation, were produced as exhibit(s) 4 and 5…,.

The tender reference number for the supply of the excavator is CH.05/11.

Darlington Chirara said, that, on the tender form, he filled in the condition of the machinery as a 200g Model, a Hyundai Model which had already done 2,972 hours as it was a second hand. Its under-carriage life percentage was 76% meaning that 24% was already worn out or gone because of use.

He said that in exhibit 5, which is the quotation, he quoted a 20 tonne excavator valued at $182,000.

He said that, on 7 July 2011, he received a letter from the defendant saying that the plaintiff had won the tender to supply a refurbished 20 tonne excavator and a 3 tonne front-end loader.

The letter was produced by consent as exhibit 6 in the supplementary bundle.

The letter was written on 6 July 2011 to the directors of the plaintiff, by G. Tanyanyiwa, who was the then Town Clerk. It is on the defendant's letter head. It reads:

“REF: Supply of refurbished 20 tonne Crawling Excavator and 3 tonne Front Loader

Reference is made to the above.

You have been awarded the Tender to supply the Municipality with the above equipment.

You are required to supply the equipment within 30 days from receipt of deposit which is going to be paid within the next 2 weeks.

May you please treat this order with urgency since there are disease outbreaks and we would like to use the equipment to arrest the spread of diseases.”...,.

During cross-examination, Mary Mukonyora, who is the defendant's Acting Chamber Secretary, said that she got employed by the defendant on 1 October 2012 as Head of Human Resources, and, in 2015, she assumed the position of Acting Chamber Secretary.

She admitted, that, the letter notifying the plaintiff of having won the tender to supply a 20 tonne refurbished excavator and a 3 tonne front end loader, which was written by G. Tanyanyiwa, the then Town Clerk, on 6 July 2011 (exhibit 6) and the minutes of the Procurement Board recommending that the plaintiff supplies a 20 tonne excavator and 3 tonne front end loader were consistent.

She said that she, however, doubted the authenticity of the letter of G. Tanyanyiwa. She said that she doubted if it was genuine.

She, however, admitted, that, other than this document which was written by G. Tanyanyiwa, there is no any other document from the defendant which notified the plaintiff of having won the tender....,.

George Makunde, the current Town Clerk of the defendant, testified as follows:

He said that he joined the defendant in August 2012 and got to know about this case through a perusal of the defendant's documents.

He outlined the procedure that is followed by the defendant in procuring equipment.

He said that a Tender Notice is flighted in a national newspaper guided by section 30 and 31 of the Procurement Act [Chapter 22:14] inviting the submission of tenders. The Procurement Committee/Board then deliberates on the submitted tenders and makes recommendations in terms of the award of the tender to the winner of that particular tender. The recommendation is made to a formally constituted full Council of the defendant in the form of a report. Full council then makes a resolution on the issue which resolution then allows or authorises the Town Clerk, as the Chief Executive Officer or Accounting Officer, to then notify the winning tenderer for the provision of the goods or service so required.

The witness alluded to the Tender Notice that was flighted by the defendant; the minutes of the Procurement Committee of 23 June 2011; and the minutes of the full Council meeting of 21 July 2011 that Mary Mukonyora referred to in her evidence.

His evidence on all these documents was similar to that of Mary Mukonyora in all material respects....,.

The witness said that he suspected that the letter that was written by the then Town Clerk, G. Tanyanyiwa, on 6 July 2011, notifying the plaintiff that it had won the tender to supply a refurbished excavator and front-end loader was as a result of a collusion between Mr. Tanyanyiwa and the plaintiff because it was written before the full Council of the defendant had made a resolution on 21 July 2011 to award the tender as per recommendations by the Procurement Committee which had set on 23 June 2011....,.

What is disturbing about this case is that, on 23 June 2011, when the defendant's Procurement Committee/Board set and recommended, in its report to full Council, that the tender for the supply of a brand new excavator and front end-loader be awarded to the plaintiff, Mr G. Tanyanyiwa, the then Town Clerk, was in attendance.

In terms of procedure, the recommendation was subject to adoption as a resolution by a full Council meeting. Such a meeting was only held on 21 July 2011.

The Town Clerk, Mr. G. Tanyanyiwa, even attended that meeting as well.

At that meeting, full Council passed a resolution that the plaintiff be awarded the tender to supply a brand new excavator and front end loader.

What is buffling is that, on 6 July 2011, well before full Council had sat, Mr. G. Tanyanyiwa wrote to the plaintiff notifying it that it had won the tender to supply a refurbished excavator and frond-end loader.

Two questions arise:

(i) Firstly, why did he notify the plaintiff that it had won the tender before full Council had held a meeting to pass the recommendation as a resolution?

(ii) Secondly, why did he tell the plaintiff that it had won the tender to supply refurbished machinery?

These queries or questions show that the then Town Clerk was not conducting himself properly in the discharge of his duties.

This is worsened by the fact, that, he was in attendance at the full Council meeting which was later held on 21 July 2011 which adopted the recommendations of the Procurement Committee/Board which stated that the plaintiff was to supply brand new equipment.

When the adoption of the recommendation was made, he knew that he had already notified the plaintiff that it had won the tender to supply refurbished equipment - but he did not inform the Council.

Obviously, that is a sign that he knew that what he had done was improper.

This is further evidenced by the fact, that, after full Council had passed the resolution to award the tender to the plaintiff, he did not write a letter notifying the plaintiff about it as he was supposed to do as per procedure.

The critical question now is: is the defendant bound by the irregular conduct of its employee, the Town Clerk, who told the plaintiff that it had won the tender to supply refurbished machinery when in fact it wanted to be supplied with brand new machinery?

The plaintiff's counsel submitted, that, by virtue of the turquand rule, the defendant is bound.

I must point out from the onset, that, the turquand rule is a principle of company law.

In terms of the turquand rule, if a party transacts with a company only to later discover that the director lacked the authority to bind the company, the company may be forced to honour the transaction if the transaction was completed in good faith by the other party.

The rule is based on the English case of Royal British Bank v Turquand 1856 119 ER 886, wherein it was held, that, people transacting with a company are entitled to assume that internal company rules have been complied with even if they are not. The exceptions to this rule are:

(i) Firstly, if the outsider was aware of the fact that the internal requirements and procedures have not been complied with (in other words, he acted in bad faith).

(ii) Secondly, if the circumstances under which the contract was concluded on behalf of the company were suspicious.

Counsel for the plaintiff went on to cite the case of Potchefstroom se Stadsraad v Kotze 1960 (3) SA 616 AA…,. The case involved a municipality. The turquand rule was held to be applicable to municipalities.

In that case, the Town Clerk, just like in this case, had written a letter to the respondent cancelling the lease agreement between the municipality and the respondent when the municipality had not authorised the cancellation of the lease agreement. The municipality was now demanding money for rent from the respondent and a dispute arose as the respondent refused to pay saying that the lease agreement had been cancelled. The court held that:

“A municipality, in the normal exercise of its functions, necessarily concludes contracts with members of the public. It would be unbusiness-like if the respondent had been duly bound, when he received the Town Clerk's letter, to make enquiries to ensure that the Town Clerk was in fact authorised by the Town Council to convey the cancellation.”

Applying the law to the present case, counsel for the plaintiff submitted, that, the internal workings of Council are not known to the plaintiff, and, as such, there is a presumption of regularity in the adherence to Council procedures which makes it impossible for the defendant to escape liability on the basis that Mr. Tanyanyiwa had not been authorised by the defendant to write the letter that he wrote on 6 July 2011.

To begin with, with all due respect, I am not in agreement with the reasoning in Potchefstroom se Stadsraad v Kotze 1960 (3) SA 616 AA that the turquand rule is applicable to municipalities.

I see no basis for saying that.

Municipalities and companies are different entities.

In terms of section 131 of the Urban Councils Act [Chapter 29:15], a Town Clerk is an employee of the defendant (municipality) and his duties are outlined in section 136. These involve the administration of council, managing operations and property of council, supervise the activities of council employees, and any other duties that may be assigned to him by the Council.

The Urban Councils Act does not give the Town Clerk powers to take over the functions of Council when it comes to procurement issues and make binding decisions on its behalf.

The Urban Councils Act has provisions which deal with how goods and services are procured and those provisions are worded in peremptory terms as they use the words 'shall' and 'shall not'.

In terms of section 210(1) of the Urban Councils Act, every municipal council shall appoint a Procurement Board which is responsible for arranging tenders and for making recommendations to Council in regard to the acceptance of tenders and the procurement of goods, materials, and services.

In terms of section 210(4) of the Urban Councils Act:

“A municipal council shall not procure any goods, materials, or services unless its municipal procurement board has made recommendations to the council thereon and the council has considered such recommendations.”…,.

I do not believe that a Town Clerk's actions have the power to override the wording of the provisions that is peremptory.

Therefore, the letter of Mr. G. Tanyanyiwa, which was written on 6 July 2011, before the full Council meeting had been held on 21 July 2011, notifying the plaintiff that it had won the tender to supply refurbished machinery is therefore of no force and consequence. It does not bind the defendant.

So the contract that was purportedly entered into by and between the plaintiff and the defendant pursuant to the letter which was written by G. Tanyanyiwa is a nullity.

Assuming that the turquand rule is applicable to municipalities, as was held in Potchefstroom se Stadsraad v Kotze 1960 (3) SA 616 AA, it would not be proper to hold the municipality bound by the actions of a Town Clerk because a Town Clerk is not a functionary of the municipality but an employee.

A councillor, instead, would bind the municipality because a council is run by councillors, not by its employees.

I would equate a councillor to a director of a company.

In terms of the turquand rule, an employee of a company does not bind the company if he purports to act on behalf of the company.

So, in the present case, even assuming that the Tender Notice was properly advertised, the letter that was written by the then Town Clerk, Mr. G. Tanyanyiwa, would not bind the defendant because he had no authority to enter into contracts on behalf of the defendant as he was not a councillor, but just an employee.

HH99-18 : C F (PVT) LTD vs ZIMBABWE REVENUE AUTHORITY
Ruled By: KUDYA J

This is an appeal against four amended income tax assessments number 20211442 for the year ending 31 December 2009; 20211443 for the year ending 31 December 2010; 202211446 for the year ending 31 December 2011; and 20211448 for the year ending 31 December 2012 that were issued against the appellant by the respondent on 27 June 2014….,.

On 25 July 2014, the appellant objected to the amended assessments in terms of section 62 of the Income Tax Act [Chapter 23:06]. On 22 October 2014, all the objections were disallowed save for a few relating to penalties.

The appellant gave notice of its intention to appeal on 30 October 2014 and duly filed the present appeal on 18 December 2014.

The appellant called the evidence of two witnesses, an independent tax consultant, LM, who worked for the respondent for the 16 years to 2006 and its Managing Director. In addition, it produced four voluminous documentary exhibits in excess of 500 pages, exhibits 1 to 4.

The respondent called its Chief Investigations Officer, OM, who has held that office since 2011 but with a total of 14 years experience, produced a 9 paged documentary exhibit, exhibit 5, and relied on the mandatory R11 documents.

Background

The appellant was incorporated on 29 September 1995 and underwent two name changes, on 24 April 1996 and 9 October 2014….,.

The second name change was precipitated by the acquisition of the South African registered sister company by the appellant's holding company on 1 June 2005.

Sometime in 2010…, the respondent commenced the tax compliance investigation on the appellant that resulted in the amended tax assessments that gave rise to this appeal. The appellant's main business activities in the four years in question were in the importation, distribution, and marketing of motor vehicles and spare parts of a specified brand….,.

The 1996 Distributor-Assembler Agreement

Initially, on 24 June 1997, the appellant entered into a detailed 53 article distributor-assembler three year agreement, the original agreement, with NML, a Japanese conglomerate engaged in the development, manufacture, and assembly and worldwide distribution and sale of an international brand of various models of motor vehicles and spare parts, retroactively from 1 April 1996….,.

The appellant had access to the conglomerate's trademarks, trade names, and engineering technology and was authorised to purchase, manufacture, assemble, market, distribute, and sell certain models of the brand, knocked down components, and spare parts through a network of dealers appointed by the appellant and approved by the conglomerate in Zimbabwe.

The ordering, production, shipment prices, and payment of the vehicles and components, in an amount sufficient to cover the price, was regulated by Articles 5 to 7 of exhibit 3….,.

The appellant met the full cost and expenses of the shipment and demurrage, and storage costs of the vehicles and spare parts. The risk for loss or damage passed to the appellant once the goods crossed the ship's rail at the port of shipment - but ownership and title of the goods was retained by the conglomerate until the payment obligation had been discharged.

It was discharged by payment into an L/C bank account opened in the name of the conglomerate by a bank acceptable to the conglomerate by irrevocable letters of credit at sight in favour of the conglomerate at which point the appellant simultaneously received the shipping documents for the relevant goods through that opening bank.

Because the timelines for ordering and the confirmation of the orders and payment preceded the production of the vehicles, ownership passed to the appellant on delivery of the vehicle FOB past the ship's rail at the port of shipment.

The appellant was solely responsible for securing Government licences and permits required to complete payments for and importation of the ordered goods….,.

The terms and conditions contemplated a cash before delivery sale.

The conglomerate could export and deliver to, and sell in Zimbabwe, brand vehicles in its own name through the agency of the appellant and pay the appellant for the services rendered.

The conglomerate played an active advisory role in the establishment of the appellant's business and was entitled to receive prescribed mandatory reports at specified periods and to inspect the appellant's operations.

The appellant undertook to maintain sufficient working capital and investment capital to enhance its business activities.

Each party was, in terms of Article 39-2, responsible for any and all expenditure incurred and assumed in the performance of its duties, obligations, and responsibilities.

Article 44 provided that:

“This agreement does not constitute either party as the agent or legal representative of the other party for any purpose whatsoever. Neither party is granted any expressed or implied right or authority to assume or to create any obligation or responsibility on behalf or in the name of the other party or to bind the same in any manner whatsoever.”

The appellant was also required to purchase a specified minimum number of vehicles, gain market share, and, in the event of a decline due to circumstances beyond its control, implement agreed counter measures to arrest the decline or risk termination of the agreement.

It appears to me, that, these were standard terms and conditions found in international contracts for the facilitation of international trade as demonstrated by their striking similarity with the conditions found in Lendalease Finance (Pty) Ltd v Corporacion de Mercadeo Agricola & Ors 1976 (4) SA 464 (A) especially in regards to the payment arrangements and the passing of both risk and ownership.

The 1 August 2007 Memorandum of Understanding

The appellant and the related party…, whom I shall refer in this judgment as the intermediary, signed a memorial of the procedures for importation of vehicles into Zimbabwe in the Memorandum of Understanding dated 1 August 2007.

The intermediary was required to place monthly production orders with the brand suppliers. The importation value of the consignment was reflected in a manual invoice issued by the intermediary to the appellant. The vehicles were imported into Zimbabwe and held in the appellant's bonded warehouse as consignment stock with the intermediary retaining ownership of the vehicles until payment was made. Once payment was made, the invoice was stamped by customs officials and duty and other imposts paid for the consignment by a clearing agent before ownership was transferred to the appellant. The appellant, in turn, invoiced and transferred the vehicles to an authorised dealer for sale.

The Distribution Agreement of 25 April 2011

On 25 April 2011, the appellant and the conglomerate entered into a “Distribution Agreement”…, consisting of 39 Articles with retroactive effect…, from 1 February 2007.

It appeared to be a reproduction of an incomplete Distribution Agreement dated 31 January 2007 that was only signed and initialled by the appellant's Managing Director….,.

It substituted the original agreement.

The preamble, structure, and, in most respects, the contents, mirrored word for word the original agreement. The noticeable change was the wholesale removal of the right to purchase knocked-down kits for assembling from and the transfer of technological assistance and assembly by the conglomerate to the appellant.

Articles 21, 22 and 23 mirrored word for word Articles 5, 6 and 7 of the original agreement in respect of the ordering, production, and shipment of the vehicles and spare parts.

Article 24, like Article 10 in the original agreement, dealt with the supply of spare parts whose purchase prices were computed on a cost, insurance and freight (CIF) or free on board (FOB) basis derived from a price list provided by the conglomerate.

The grounds for termination were generally similar to those in the original agreement.

The Memorandum on Sales and Purchase of the Conglomerate Vehicles of 25 April 2011

The appellant and the conglomerate entered into a memorandum on Sales and Purchases of brand vehicles with the intermediary, retroactive from 1 February 2007, soon after signing the Distribution Agreement.

The appellant appointed and the conglomerate approved the appointment of the intermediary as the intermediary for the sale and purchase of the vehicles from the conglomerate under the Distribution Agreement.

The three parties agreed that the intermediary would purchase the vehicles from the conglomerate and sell them to the appellant.

The parties all incorporated the ordering, pricing, and payment and supply of spare parts provisions in Articles 21, 23 and 24 of the Distribution Agreement. They further agreed that any violation or default of those provisions, by the intermediary, would be ascribed to the appellant.

The Management Services Agreement between the Appellant and the Intermediary of 2 March 2009

On 2 March 2009, the appellant and the intermediary entered into a Management Services/Technical Services Agreement which was governed by the laws of Zimbabwe and took effect on 1 March 2009.

They were motivated by the introduction of the multi-currency financial regime in Zimbabwe. It was to run for an indefinite period. The intermediary undertook to:

“Provide administrative services, financial services and support and logistical services and support to help appellant achieve its goals in terms of gaining market share, growth and profitability…, ensure that new developments and systems will be properly communicated together with appropriate facilitation of technical support, system materials and training…, (and) be available to provide help and guidance on any aspect of the business mentioned, at the request of appellant.”

In regards to the computation of the fees, the parties agreed that:

“The intermediary will calculate the fees based on both the turnover reported by appellant and also the level of input that has been provided in terms of this agreement. The fees to be provided for shall be 2% of turnover; however, this will not necessarily be the amount finally invoiced. The amount finally invoiced shall not exceed 4% of turnover.”

And, in respect of payment, they agreed that:

“Payment of the management fees shall ordinarily be made in the year following that on which the fees have been based on receipt of an invoice from the intermediary. For cash flow purposes, it will be permissible to make part payments, but, at least two half-yearly payments will be required.”

The implementation and operation of the agreements

The evidence of the appellant's Managing Director was that the intermediary, a Mauritian registered short-term credit financier interposed between the conglomerate and the appellant in the purchase of the vehicles and spare parts destined to Zimbabwe.

Customers in Zimbabwe would place an order on the brand model of their choice, either to the appellant or an approved dealer appointed by the appellant. The appellant would group the orders and submit a bulky order of the required stock of vehicles, four (4) months in advance, to the intermediary, which, in turn, placed orders with the conglomerate.

The conglomerate would build the ordered vehicles for the intermediary.

The intermediary would purchase the vehicles, in its own name, from the conglomerate, and consign them directly to the appellant's bonded warehouse in Zimbabwe.

The intermediary retained ownership of the consignment in bond until it was paid.

Ownership vested in the appellant upon payment of the purchase price equivalent to the value for duty purposes.

Thereafter, the appellant would, where applicable, pay customs duty, surtaxes, and VAT based on the agreed value, through a clearing agent, before the consignment was released from the bonded warehouse and delivered to the approved dealer and end user.

The appellant used to import stock from a South African related party and the conglomerate under value rulings 18 and 29 of 2001 before the advent of the French holding company. These were replaced by value ruling 15 of 2007, on 5 November 2007, following upon protracted negotiations between the appellant and the respondent that commenced on 26 March 2006….,.

A sample of the documents used in the consignment of the vehicles from the intermediary to the appellant were captured on pp14 to 38 of exhibit 2 and pp1 to 9 of exhibit 5.

These were commercial invoices, telegraphic transfers, and Zimra certificates of origin, bills of entry, and customs clearance certificates.

These commercial invoices…, denoted the intermediary as the supplier and the appellant as the purchaser and consignee.

The vehicles were fully described by model, chassis and engine number, colour, and year of manufacture.

The order number, dates of issue and delivery, method of shipment, origin and destination together with the terms of payment, the free on board purchase price, the cost of freight, insurance and total CIF price, denominated in United States dollars, were also indicated.

The certificates of origin…, certified that each vehicle was manufactured by the supplier in South Africa and bore the same information contained in the commercial invoice in regards to the supplier, consignee, and description of the vehicle.

The bills of entry…, were completed by the clearing agent and identified the intermediary as the exporter or consignor.

They identified the country of supply and destination, the description, and total invoice value of each vehicle separately from the freight and insurance charges.

The customs clearance certificates…, for each vehicle were issued by Zimra.

They contained the full description of the vehicle shown in the commercial invoice. The cost, freight, and insurance price for each vehicle sold was captured in a combined invoice…, issued by the intermediary to the appellant, which the appellant submitted to its bankers with instructions to pay the intermediary by telegraphic transfer….,.

The sequence of dates on these documents showed that an advance payment by telegraphic transfer was made on 12 February 2007, the certificate of origin was presented on 15 April 2007 while the commercial invoice was issued on 24 April 2007 and the vehicle was cleared by a bill of entry at the port of entry on 9 May 2007. Thereafter, a customs clearance certificate was issued on 19 June 2007.

It was common ground, that, the intermediary's consignment was delivered to Zimbabwe and warehoused by the appellant in bond.

It was common cause, that, the appellant did not suffer any exposure to foreign currency risk or credit risk since the end users were required to make payment before the relevant vehicles were dispatched from South Africa…, in 2009 and 2010.

However, in 2011 and 2012, the appellant was exposed to foreign currency risk through the importation of inventory, the liability of which was settled in South Africa in a carrying amount of US$264,729 and US$294,956 respectively….,.

It was common ground that the appellant received vehicle prepayments in the sum of US$2,064,187…, in 2010 that was subsequently revised to US$4,693,512…, in the 2011 financial statements, US$3,086,165 in 2011…, and US$755,673…, in 2012.

Summary of the Tripartite Arrangement

The nature and scope of the tripartite arrangement between the parties was concisely set out by counsel for the respondent in paragraph 5 of his written heads of argument.

A customer placed an order to the appellant through an approved dealer appointed by the appellant. The appellant placed orders with the intermediary, which, in turn, procured the motor vehicles from the conglomerate.

The appellant received the motor vehicles in Zimbabwe and kept them in a bonded warehouse.

Ownership of the motor vehicles remained with the intermediary until duty had been paid by the appellant.

The purchase of a motor vehicle by a customer resulted in the payment of duty to the respondent by the appellant before the vehicle was released to the customer.

The intermediary was paid the transaction value of the motor vehicle, which, according to the letter of the appellant to the respondent, of 8 August 2007, included a 5% administration charge and interest of the selling price on the price list…, in which was incorporated its mark-up of between 7.5% and 10%.

The appellant was responsible for rentals, marketing expenses, and payment of duty.

It sold the vehicles to the dealers at a mark-up of 7.5% and the dealers sold the vehicle to the end customer.

Concessions made at the commencement of the appeal hearing

At the commencement of hearing, the appellant confirmed the concession first made in the letter of 19 June 2014, that, it was remiss in failing to charge the intermediary a mark-up of 7% for transit services rendered in the sum of US$2,240 for 2009, US$2,505=87 for 2010 US$2,198=13 for 2011 and US$3,273=40 for 2012 in respect of vehicles exported by the intermediary to Zambia, Malawi and Tanzania.

Again, the appellant conceded, that, it paid management fees to the intermediary when such fees were not due in the sum of US$130,000 in 2009, US$140,000 in 2010, US$256,629 in 2011 and US$140,000 in 2012.

In the same vein, the respondent conceded, that, it wrongly raised notional interest at the rate of 24% in the sum of US$97,279=92 in respect of the 2012 loan to GS and in the sum of US$106,953=12 for 2010, US$266,879=52 for 2011 and US$124,666=80 for 2012 in respect of the loans availed to ADI.

Assessment of witnesses

The appellant acted in a devious manner in regards to management fees. Its conduct amounted to a deliberate act of transfer pricing which was done with intent to avoid tax.

The production of backdated agreements gave the impression that these were created as a response to the tax investigation.

This was apparent from the purported agreement of 31 January 2007 which had the appellant's signatures only that was rejected by the respondent and resulted in the production of duly signed agreement of 25 April 2011 backdated to 1 February 2007.

The Managing Director misled the court that the appellant provided functional analysis input under duress, contrary to his letter of 12 July 2013 in which he requested two weeks within which to provide the requested information, thus affording the appellant in excess of a month from the date of the initial request.

He disputed making prepayments to the intermediary yet the financial statements, in note 17 on p71 of exhibit 1, show that US$4,693,512 was paid in 2010 and US$3,086,165 in 2011 before the vehicles were exported in bond.

He falsely averred, and thus copied the evidence adduced by the Tax Consultant in his presence, that, the audits for his company commenced in November of each year in contradistinction to the timelines indicated in the audit engagement letter.

The tax consultant prevaricated on what the respondent's generally prevailing practice in regards to provisions was.

The chief investigations officer failed to demonstrate how he arrived at the apportionment ratio he used in his functional analysis. He testified that the appellant misled the respondent by claiming ownership of the consignment stock at the time he applied for the value ruling, contrary to the contents in the letters written by the appellant at that time.

The issues referred for determination

At the pre-trial hearing of 2 June 2015, the following issues were referred for determination. In view of the concessions made by the respondent at the commencement of trial, it is no longer necessary to outline in respect of the loans advanced by the appellant to GS and ADI.

Sharing of profits/transfer pricing

1. Whether or not the respondent is precluded from adopting its current stance on this issue on account of either:

1.1 The value ruling issued by it; or

1.2 The fact that duties and taxes were assessed and paid to it on a different basis.

2. Whether the respondent is entitled to invoke section 24 of the Act to deem income to have accrued to the appellant which was not actually received by it.

Expenses relating to Leave Pay and Audit Fees

1. Whether it was proper of the appellant and open to the appellant to make provision for the costs in question.

2. Whether the respondent was precluded from issuing amended assessments by virtue of the provisions of section 47 of the Act.

Penalties

1. What, if any, penalties are payable to the respondent.

I proceed to deal with each issue in turn.

Sharing of profits/Transfer Pricing

The respondent's current stance

The position adopted by the respondent during the investigation, objection, determination, and espoused in correspondence with the appellant, and in evidence and argument at the appeal hearing was to disregard the values of the motor vehicles received into the country by the appellant that were accepted by the Commissioner-General in the Value Ruling No.15 of 2007 of 5 November 2007 issued under sections 106 and 113 of the Customs and Excise Act [Chapter 23:02] in preference to the values derived from the functional analysis purportedly computed in terms of section 24 the Income Tax Act.

The Value Ruling

The Value Ruling No.15 of 2007 was issued on 5 November 2007. It replaced two other value rulings, Numbers 18 and 29 of 2001.

The transaction value accepted by the respondent, in the first value ruling, was based on the “invoiced prices plus dutiable adjustments” and in the second value ruling it was based on the invoice price plus Yen12,500 on each complete CKD kit and automobile CBU plus dutiable adjustments value and an uplift on the spare parts of 5% of the invoice price plus dutiable adjustments.

The transaction value of the consignment stock provided in section 113(2) of the Customs and Excise Act also included all costs, charges, and expenses incidental to the sale and handling and transport costs from the port of exportation to the port of importation in Zimbabwe.

The application preceding Value Ruling 15 of 2007 was necessitated by the change of ownership in the appellant through the purchase of 75% of the appellant's capital by a French company which also wholly owned the share capital in the intermediary. The holding company instigated the substitution of the conglomerate and the South African company in the supply matrix by the intermediary with the result that the appellant was designated as the importer and the intermediary as the supplier in the Value Ruling Number 15 of 2007.

The Ruling stated that:

“MOTOR VEHICLES

Invoiced prices plus dutiable adjustments are acceptable.

SPARE PARTS

Invoiced prices plus dutiable adjustments are acceptable.

Transaction Value, TV, Method applicable.

Subject also to the inclusion of all costs, charges, and expenses not mentioned above which are incidental to the sale and to placing the goods on board the means of transport they are removed from country of exportation. Any subsequent costs, charges, and expenses incurred in delivering the goods to the place of importation in Zimbabwe should also be included in terms of the Customs and Excise Act.”

The covering letter of the same date explained that:

“Based upon the information you have provided regarding your importations from the intermediary - RSA, the following value ruling number 15/2007 has been issued by the Commissioner General of the Zimbabwe Revenue Authority in terms of section 106 and 113 of the Customs and Excise Act [Chapter 23:02] as amended.

The value for duty purposes will consist of the total price paid or payable (directly or indirectly) for the goods, plus any necessary dutiable adjustments referred to in section 113 of the Customs and Excise Act [Chapter 23:02].

Your necessary dutiable charges/adjustments include the cost (not already included in the invoice) of any packages, packing, loading, handling, transport, and insurance associated with the transportation of the goods to the place of importation in Zimbabwe.

Provided that the relative amounts can be distinguished from the price of the goods and the necessary documentary evidence is furnished with the customs entry, the cost of transport and insurance beyond the place of importation may not be included in the value for duty purposes.

The Commissioner General has made the ruling in accordance with the principles of the WTO valuation code based upon the present terms and conditions of trading between yourselves and the supplier concerned, as made known to the Department.

Any changes of these terms and conditions of trading must be notified to this office immediately.”

In a further covering letter of the same day, the respondent confirmed that the appellant was the importer.

However, this view was contrary to the insurance attestation on pp73 and 74 of exhibit 2, covering the 2007 calendar year, in which the French based insurance brokers certified that the intermediary's vehicles sold to the appellant were validly insured against damage and that the insurance policy was subject to automatic renewal from year to year. The risks covered were identified in bold print as:

“all risks from the warehouse of the seller to the warehouse of the consignee in Zimbabwe, on CIF value.”…,.

Sections 104 to 119 in Part X of the Custom and Excise Act [Chapter 23:02] deal in detail with the computation of the value for duty purposes.

The value, for duty purposes, is derived from the transaction value of the goods or services imported or due to be imported into Zimbabwe. The formula is provided in section 105(1) and in the opening words of section 106(1) of the Custom and Excise Act in these terms:

“105 Value for duty purposes

(1) For the purpose of assessing the amount of any duty payable on any imported goods and for the purpose of any declaration or oath which may be required by this Act or any other enactment in relation to any question of value or duty in connection with the importation of goods, or goods which are likely to be imported, the value of such goods shall, subject to this Act, be the transaction value thereof as established or determined in terms of sections one hundred and six to one hundred and twelve.

106 Transaction value: primary method of valuation

(1) Subject to this Act, the value for duty purposes of any imported goods shall be the transaction value of the goods, that is to say, the price actually paid or payable for the goods when sold for export to Zimbabwe, adjusted in terms of section one hundred and thirteen, if —“…,.

The price actually paid or payable on imported goods is defined in section 104 of the Customs and Excise Act as the aggregate of all payments made or to be made on these goods by the importer to the seller that is to the satisfaction of the Commissioner and the value determined by the Commissioner of any consideration or services rendered or to be rendered by the importer for the benefit of the seller.

The concept of related parties is captured in section 104(3) of the Customs and Excise Act to include individuals who, inter alia, are officers or commissioners in each other's businesses or corporate bodies in which any other person, directly or indirectly, owns, controls or holds at least 5% of the issued shares of both or both are so controlled by a third person or control a third person or are members of the same family.

In terms of section 104(4) of the Customs and Excise Act, any sole agent or distributor or concessionaire of the other who falls into any of the categories listed in subsection (3) is deemed to be a related party under Part X of the Customs and Excise Act.

There are five other elaborate methods of computing the transaction value of goods for duty purposes set out from section 107 to section 112 of the Customs and Excise Act.

These comprise of the first alternative method and second alternative method which are based on the values of identical and similar goods, respectively, exported to Zimbabwe at about the same commercial level and the same quantity at about the same time.

The third alternative deductive method is based on comparative sales between unrelated parties of similar or identical goods less any commissions, mark-up, cost of sales, transport, loading and unloading, handling and insurance costs within Zimbabwe from the place of importation and any duty or tax payable locally on importation or sale of the goods.

The fourth alternative method relies on the manufacturer's production costs plus mark-up.

The final alternative method is a fall back method, which incorporates the preceding four methods with necessary modifications.

The respondent is precluded from resorting to fictitious or higher alternative values from the country of origin or to any prescribed minimum custom values.

The adjustments prescribed by section 113 of the Customs and Excise Act are additional to the price actually paid or payable by the importer to the seller to the extent that they were incurred by the buyer and were excluded in the price actually paid or payable. These includes: packing, loading and unloading, handling, transport and insurance, royalties and licence fees for the use of intellectual property rights, transport and insurance from the place of manufacture to the place of export to place of importation into Zimbabwe but the costs incurred within Zimbabwe, from the place of importation, are excluded from the transaction value.

It is clear from the provisions of section 114 of the Customs and Excise Act, that, the value of any imported goods in the Bill of Entry does not constitute the value determined and accepted by the Commissioner for duty purposes.

In correspondence, and the determination to the objection, as well as in pleadings, evidence, and argument, the respondent advanced two reasons for abandoning the Value Ruling in the present matter and electing to assess the appellant for income tax purposes on a different basis:

(i) The first was that the Value Ruling applied to the determination of the duty value of the imported motor vehicles, which constitute the subject matter of the income tax appeals.

(ii) The second and alternative contention was that the respondent was not bound by the Value Ruling as from 1 March 2009 and throughout the tax years in which the appeals relate because the appellant reneged on one of the terms and conditions going to the root of the Value Ruling in that it failed to inform the Commissioner General of the Management Fees/Technical Fees Agreement entered into with the intermediary on 2 March 2009.

Whether the Customs and Excise Value Ruling binds the Commissioner in an Income Tax matter

Counsel for the appellant contended, that, the Commissioner was bound by the Value Ruling in question in the present income tax appeals even though it was made to resolve a Customs and Excise question.

Counsel for the respondent made contrary submissions on the point.

Counsel for the appellant contended, that, as a single entity, the Zimbabwe Revenue Authority was obliged by the fundamental provisions section 68 of the Constitution and section 3(1)(a) of the Administrative Justice Act [Chapter 10:28] to act in a lawful, reasonable, and fair manner in utilising its opinion formed under the Customs and Excise Act on the transaction value of the imported motor vehicles to the computation of the purchase price under the Income Tax Act.

He contended, that, the Commissioner could not possibly justify the change of opinion, reflective as it was of his state of mind, in the finding that the relationship between the appellant and intermediary did not influence the transaction value.

He further contended, that, the importer had proved, to the satisfaction of the Commissioner, that, the transaction value closely approximated the values referred to in section 106(2) of the Customs and Excise Act.

Counsel were however agreed, that, there was no specific section in the Scheduled Acts which require the Commissioner to act in the manner advocated by counsel for the appellant.

The foundational provisions of the Revenue Authority Act [Chapter 23:11]

It is indisputable, that, the respondent is created by section 3 of the Revenue Authority Act [Chapter 23:11] as a single entity with the seamless functions outlined in section 4, amongst which is the assessment, collection, and enforcement of the payment of all revenues under the administrative purview of a single Commissioner-General appointed in terms of section 19.

However, in terms of section 20 and 21, the Board also appoints Commissioners in charge of such departments or divisions that the Board may establish but who serve under the control of the Commissioner General and who administer the Scheduled Acts listed in the First Schedule amongst which are the Customs and Excise Act and the Income Tax Act.

The Commissioner-General is empowered to exercise the functions conferred on each of these Commissioners and may delegate such authority to any member of staff.

The delegated authority, unless set aside by him, is deemed to be his authority.

In terms of section 34D, the Commissioner General may personally, or by proxy, make an advance tax ruling on any provision of any of the Acts in the First Schedule of his own accord or on application by an interested person to a taxable transaction.

Tax is defined in the Fourth Schedule as “any tax, duty, fee, levy, charge, penalty, fine or any money levied, imposed, collected or received in terms of any of the Acts specified in the First Schedule” while “relevant Act in relation to an advance tax ruling means any one the Acts specified in the First Schedule in respect of which the ruling is made or sought.”

The context and the 13 minimum contents of an Advance Tax Ruling are provided in paragraph 2(2) of the Fourth Schedule to the Revenue Authority Act.

Sub-paragraphs (2)(c) to (f) require a complete description of the proposed transaction for which the ruling is sought and its impact on the tax liability of the applicant and a citation of the relevant statutory provisions or issues and reasons why the proposed ruling should be made.

It is apparent to me, contrary to the contention propounded by counsel for the appellant, in paragraph 12(b) of his written heads of argument, that, the application for the Value Ruling, set out in exhibit 2, does not meet these minimum requirements in respect of the Income Tax Act.

In this regard, the submission made by counsel for the appellant, in paragraph 10 of his written heads of argument, to the effect that one ruling in respect of one Schedule Act fits all the other Scheduled Acts in regards to the same imported item, is devoid of any merit.

The differentiation applied by the respondent was lawfully grounded in the minimum requirements for an Advance Tax Ruling provided in paragraph 2(2) to the Fourth Schedule of the Revenue Authority Act.

Again, the Value Ruling falls woefully short of the requirements of paragraph 6 of the same Schedule failing as it does to apply to the relevant Income Tax Act.

While the facts and circumstances may be the same as in the value ruling, the four requirements in paragraph 6 are conjunctive; so, the failure to fulfil any one is fatal to the appellant's contention seeing it falls outside the time frame of the advance ruling and the requirement to update the Commissioner with any new information affecting the value ruling.

The attempt to export the favourable interpretation in paragraph 4(1) of the Fourth Schedule to the Revenue Authority Act, from the Customs and Excise Act to the Income Tax Act, flounders on the phrase “apply the relevant Act” defined with reference to the specified Act in respect of which the ruling was made or sought.

The value ruling was not sought and obtained in terms of the Income Tax Act but in terms of the Customs and Excise Act.

In the alternative, counsel for the appellant submitted, that, like should be treated alike otherwise it would be unconscionable for the respondent to alter its opinion merely for the sake of extracting as much income tax from the appellant as it did with respect to customs duty on the same facts and circumstances.

He submitted, that, by making the Value Ruling, the respondent, in essence, determined, as contemplated by section 106(2) of the Customs and Excise Act, that the two related parties acted at arm's length, a consideration in convergence with the requirements of section 24 of the Income Tax Act.

He argued, that, the juxtaposition of a different and contradictory opinion on the purchase price, under the Income Tax Act, to the transaction value under the Customs and Excise Act of the self-same imported vehicles, was both illogical and unlawful.

The judicial definition of an opinion

The word opinion is not defined in any of the Taxes Acts. It has been judicially defined in a number of cases:

In Judes v District Registrar of Mining Rights, Krugersdorp 1907 TS 1046…, INNES CJ equated a decision, in the absence of a qualification, with a final determination.

Both Herbert Porter & Co Ltd and Another v Johannesburg Stock Exchange 1974 (4) SA 781 (W)…, and Knop v Johannesburg City Council 1995 (2) SA 1 (A)…, defined decision as “the final and definite result of examining a question” and “adjudication in the juristic sense, i.e. a final and definite result in consequence of examining a question”, respectively.

These definitions were adopted in Media Workers Association of South Africa & Ors v Press Corporation of South Africa Ltd (Preskor) 1992 (4) SA 791 (A)…,. This was a labour matter in which the relevant statutory provision stipulated that “an assessor shall be a person, who, in the opinion of the Chairman of the Court, has experience in the administration of justice or skill in any matter which may be considered by the Court.”

By reference to The Shorter Oxford Dictionary, it was held, at 796E, that, an opinion was a matter of speculation which could not be proved by any available evidence to be right or wrong.

In the local case of R v Foster 1962 (1) SA 280 (SR)…, BEADLE CJ held that:

“Opinion means something different from 'intention'…,. If the long and complex definition of 'opinion' in the Shorter Oxford Dictionary is examined, it will be seen that the meaning of 'opinion' includes only such things as 'a judgment' or 'a belief of something'. It does not include merely an intention.”

However, in R v Sibanda & Ors 1965 RLR 363…, an opinion of a court was equated with a judgment derived from objective facts and not a belief.

In my view, the publication and contents of the Value Ruling No.15 of 2007, and the accompanying correspondence, demonstrated that the Commissioner-General was alive to the powers vested in him generally by Part X, and, in particular, by section 106 and 113 of the Customs and Excise Act.

It seems to me, that, the provisions in Part X delineate almost all the possible ingredients that constitute a transaction value for the purposes of computing the duty value of an imported item under the Customs and Excise Act.

In summary, the ruling was that the sum payable to the intermediary was the value for duty purposes and that amount was religiously treated by the appellant as the purchase price of the motor vehicles in all its tax returns from the time it took effect.

And rightly so, for those ingredients, in my view, are similar to the considerations which must necessarily constitute the purchase price of such an imported item for Income Tax purposes.

In ruling on the transaction value for duty purposes, the Commissioner General made a final and definitive determination amounting to an “adjudication in the juristic sense, i.e. a final and definite result in consequence of examining a question” or a 'judgment' as indicated in Knop v Johannesburg City Council 1995 (2) SA 1 (A) and R v Foster 1962 (1) SA 280 (SR), respectively.

That final and definite determination was that the relationship between the appellant and the intermediary did not influence the price actually paid for the goods concerned.

The opinion of the Commissioner was that the parties acted at arm's length in setting the transaction value.

The finding was based on the objective assessment of the information provided to the Commissioner, which information would, more or less, be used to determine the purchase price of the imported vehicles.

The introduction of a different statute would not change the value of the motor vehicles nor the finding that the parties had an arm's length relationship, especially in view of the respondent's refusal to refund the duty, surtax, and VAT paid on the higher transactional value.

Clearly, the appellant cannot approbate and reprobate in respect of the same motor vehicles simply because the imposts are levied under two different statutes.

Contrary to the submission by counsel for the respondent, in paragraph 11.2 of his written heads of argument, I am satisfied, that, the assessment and payment of import duties and taxes based on the transaction value of these vehicles, which was objectively ascertained by the respondent, is binding on the respondent.

The appellant has shown that it knows of no other means and the respondent has not discharged the evidentiary onus that shifted to it of showing how the purchase price required for the computation of taxable income on these vehicles could have been arrived at other than in the same way that was used to ascertain the transaction value.

HH99-18 : C F (PVT) LTD vs ZIMBABWE REVENUE AUTHORITY
Ruled By: KUDYA J

The appellant relied on..., an extract from the Commissioner's Assessors Handbook, a private and confidential internal document issued by the respondent for the guidance of his employees in applying the provisions of the Income Tax Act.The appellant's first witness introduced paragraph 145(e) of the Assessor's Handbook into evidence...,.An extract of ...

The appellant relied on..., an extract from the Commissioner's Assessors Handbook, a private and confidential internal document issued by the respondent for the guidance of his employees in applying the provisions of the Income Tax Act.

The appellant's first witness introduced paragraph 145(e) of the Assessor's Handbook into evidence...,.

An extract of the relevant paragraph..., reads:

“[145] This subsection details the expenses which a client is not entitled to deduct from his income. The deductions not allowed are:

(e) Income taken to a reserve fund or capitalised in any way. In practice, this paragraph is not applied to specific reserves created in respect of leave pay, directors fees, bonuses and the like. Such reserves and provisions will be allowable deductions if -

(i) The amounts are voted on or before the date of the relative accounts or the annual general meeting at which they were considered; and

(ii) The income is taxable in the year of assessment following that in which it is allowed as a deduction.”...,.

The answer as to whether paragraph 145(e) of the Commissioner's Assessors Handbook constitutes a practice generally prevailing in the Commissioner's office is provided by section 37A(11) to (13) of the Income Tax Act and paragraph 4(6), and 5(3) to the Fourth Schedule of the Revenue Authority Act.

Section 37A(11) to (13) of the Income Tax Act stipulates that:

“(11) Where a specified taxpayer has furnished a return in terms of subsection (1), the taxpayer's return of income is treated as an assessment served on the taxpayer by the Commissioner-General on the due date for the furnishing of the return or on the actual date of furnishing the return, whichever is the later.

(12) Notwithstanding subsection (1), the Commissioner General may make an assessment under section 46 and 47 on a specified taxpayer in any case in which the Commissioner-General considers necessary.

(13) Where the Commissioner-General raises an assessment in terms of subsection (12), the Commissioner General shall include with the assessment a statement of reasons as to why the Commissioner General considered it necessary to make such an assessment.
[Section inserted by Act 12 of 2006].”

It seems to me that subsection (12) allows the Commissioner to reopen an assessment, such as the self-assessments in question, provided he is not precluded from doing so by either proviso (i), (ii) or (iii) of section 47(1) of the Income Tax Act.

The 6 year prescription prescribed in proviso (ii) and proviso (iii) do not apply to each of the provisions under consideration.

The first proviso, if proved on a balance of probabilities by the taxpayer, would preclude such a re-opening.

The appellant maintained, that, paragraph 145(e) of the Assessors Handbook established such a practice.

Paragraph 4(6) to the Revenue Authority Act deals with binding rulings while paragraph 5(3) of the same Act deals with non-binding rulings. They stipulate that:

“(6) A publication or other written statement issued by the Commissioner-General does not have any binding effect unless it is an advance tax ruling.”

And 5(3):

“(3) Any written statement issued by the Commissioner General interpreting or applying the Income Tax Act [Chapter 23:06] prior to the 1st January 2007, or any other relevant Act prior to the 1st January 2009, is to be treated as and have the effect of a non-binding private opinion, unless the Commissioner-General prescribes otherwise in writing.”

It was common cause, that, the extract from the Assessor's Handbook was neither an Advance Tax Ruling nor a non-binding private opinion issued by the Commissioner to a taxpayer. Nor did it meet the prescribed requirements for a general binding ruling or a private binding ruling in paragraphs 10(3) and 11(5), respectively, to the Fourth Schedule in question.

However, it could liberally be interpreted to fall into the category of “any written statement issued by the Commissioner interpreting or applying the Income Tax Act [Chapter 23:07] prior to 1 January 2007” contemplated by paragraph 5(3) above.

The evidence of the first witness of the appellant attested to its existence during the time of her employment with the respondent - prior to 1 January 2007.

It would therefore have the effect of a non-binding private opinion, which, in terms of paragraph 5(2) “may not be cited in any proceeding before the Commissioner-General or the courts other than a proceeding involving the person to whom the non-binding private opinion was issued.”

It was common cause, that, the extract in the Commissioner's handbook was never issued to any taxpayer - let alone the appellant.

It was therefore remiss of the appellant to seek to rely on it to establish a practice generally prevailing in the respondent's office.

By operation of law, the appellant is precluded from relying on it to establish a generally prevailing practice.

HB46-15 : ZENZO NTULIKI vs TIMOTHY SEAN WHITE and OFFICER COMMANDING MATEBELELAND SOUTH PROVINCE and THE SHERIFF OF ZIMBABWE N.O.
Ruled By: MOYO J

This is an application wherein the applicant seeks a provisional order whose interim relief is couched as follows:

“(1) That the applicant shall be allowed unhindered access to the farm known as Lot 2 of Lot 36 Essexvale also known as Avalon Farm, Esigodini and to carry out thereupon all normal farming activities.

(2) That the respondents, its agents, assignees, associates, or employees be and are hereby interdicted and stopped from interfering with the applicant's operation of the farm known as Lot 2 of Lot 36 Essexvale also known as Avalon farm.”

The facts of the matter are that the applicant was allocated Lot 2 of Lot 36 of Essexvale (Avalon) in Umzingwane Matebeleland South Province by the Ministry of Lands in an offer letter dated 4 December 2014.

He then went to the farm and sought to occupy same.

He alleges that an agreement had been reached with the first respondent who had agreed to vacate the farm in January 2015, but, that, on 10 January 2015, the first respondent reneged on his word and stopped the applicant's workers from moving into the farm.

The applicant alleges, that, the first respondent then went on to evict the rest of his workers who were at the farm. He alleges that the first respondent has disturbed his peaceful possession of the farm.

The first respondent has raised points in limine in opposition to the urgent application:

(i) He avers, that, there is no urgency in this matter as evidenced by the fact that the applicant has never been in occupation of the farm in the first place.

He avers that he has always been in lawful occupation of the farm and that he never suggested that he would vacate the farm by 10 January 2015.

He alleges that the applicant sent his workers to the farm without the first respondent's consent thereto.

He avers, that, his legal practitioners then wrote to the applicant advising him that due process had to be followed in taking over the farm and that he could not forcibly dispossess him of the farm.

(ii) The first respondent also raises another point in limine which is to the effect that the relief sought in the provisional order is incompetent as the provisional order seeks interim relief that is the same as the terms of the final order sought and has in fact the import of a final order as opposed to interim relief.

Firstly, I will therefore move on to deal with the issue of the relief sought.

It is clear that the terms of the final order sought are similar to the interim relief and they are:

“(1) That the Provisional order set out herein be and is hereby confirmed.

(2) That the respondent shall pay the costs of suit at an attorney client scale.”

The interim relief itself, which I have alluded to earlier herein, has the import of a final order as it is to the effect that the applicant be given unhindered access to the farm and that he carries therein normal farming activities as well as that the respondent be interdicted and stopped from interfering with the applicant's operations on the farm.

This clearly is a final order couched as interim relief.

It is indeed undesirable to have such a state of affairs because the applicant virtually seeks to obtain final relief without having proved its case. This is because interim relief is obtained merely on establishing a prima facie case as opposed to a proven case: refer to the case of Kuvarega v Registrar General 1998 (1) ZLR 188 (H).

This is an irregularity; the applicant, in my view, wants to be granted final relief on a platform that requires that only a prima facie case be established.

This is not proper and the application cannot succeed by reason of this irregularity.

Again, on the issue of urgency, the problem is that the applicant seems to have sought to occupy the farm without following due process.

The applicant must wait for the law to take its course before creating an urgency for himself.

It would seem the applicant failed in his bid to despoil the first respondent, rather than that he was in peaceful and undisturbed possession as he clearly failed to obtain the possession in the first place.

Again, even if I were to overlook that irregularity; on the merits of the application, the applicant would still need to satisfy the three requirements for an interdict, these being;

“(1) A right which, though prima facie, is open to some doubt;

(2) A well grounded apprehension of irreparable injury;

(3) The absence of any other remedy.”

This is enunciated in the case of Zesa Staff Pension Fund v Mushambadzi SC57-02.

The applicant in this case has produced an offer letter, so, one could hold that the first requirement has been met; a prima facie right has been established, although it is open to some doubt when one looks at the first respondent's papers. The requirement is nonetheless satisfied.

The second remedy, of a well-grounded apprehension of irreparable injury…, is the second in line to be satisfied. I have underlined the words well grounded to emphasize the aspect of the foundation of the fear, it need not be just a fear but a well grounded fear.

In my view, the applicant, upon receipt of the offer letter, as annexed to his papers, should have followed due process in seeking to occupy the farm.

By due process, I mean, that, rather than confronting the first respondent and advising his imminent take over of the farm, he should have left it to the land authorities to notify the first respondent to vacate the land and give him a reasonable period within which to leave; this, moreso in light of the letter from the Ministry of Lands, dated 17 May 2007, acknowledging that the first respondent is at the farm, which is the subject matter of this dispute, and he has made an application to the Ministry of Lands for an offer letter.

Section 3(2)(a) of the Gazetted Land (Consequential Provisions) Act [Chapter 20:28] provides thus:

“Every former owner or occupation of Gazetted Land (a) referred to in paragraph (a) of the definition of 'Gazetted Land' in section 2(1), shall cease to occupy, hold or use that land forty-five days after the fixed date, unless the owner or occupier is lawfully authorized to occupy, hold or use that land.”

This then takes us to the next question of; what is lawful authority?

Lawful authority, in my view, is authority given by the land acquiring authority.

The letter that the first respondent understands to authorize him to remain in occupation of the farm is by the Chief Lands officer from the Ministry of Lands. The offer letter given to the applicant is by the Ministry of Lands.

It is my considered view, that, the Ministry of Lands cannot allow a party to occupy land, then offer the land to another without following the requirements of the rules of natural justice that demand that the one who understands has a right to remain in occupation, should be duly notified of the intention to take that right away, make representations, if any, and a decision be taken subsequently after all concerned have been heard.

It is not disputed, that, the first respondent has remained in occupation of the farm for years by virtue of the written assurance given to him by the same Ministry, which has now given the applicant an offer letter, without first duly notifying the first respondent of the current position.

In my view, administrative decisions should be taken within the ambit of the law.

Whilst the Lands Ministry, as the acquiring authority, is vested with all rights in relation to State land, such authority should be exercised with due consideration of the rules of natural justice.

They wrote to the first respondent and made him believe that he could remain in occupation of the land; they should have, at the time they took the decision to offer the land to someone else, advised the first respondent as such.

The first respondent also challenges the purported offer letter to the applicant as being fake, for the simple reason that it now offers the applicant what the first respondent believes he is rightfully occupying by virtue of authority from the Lands Ministry.

Unfortunately, the Ministry of Lands, as well as the Chief Lands officer who purportedly authored the letter dated 17 May 2007, were not cited as parties to these proceedings.

When I pointed this out to the applicant's counsel, he submitted, that, he chose to have the application proceed without the citation of and service of the application on the Ministry.

This creates difficulty in that we are now faced with two conflicting scenarios created by the same Ministry but they are not here to enlighten the court on which is which.

The court finds itself hamstrung in this situation as only the lands office could vouch for the authenticity of the offer letter that is being challenged.

The applicant should follow due process in the eviction of the first respondent; the applicant cannot, on this platform, seek to evict the first respondent by means of a provisional order.

The requirement for a well grounded fear is not satisfied, in my view, for the afore-stated reasons; for, the applicant had not taken effective control of the farm, neither had the Ministry of Lands taken effective steps to give him possession and control of the farm in light of the conflicting correspondence by the same office.

For the applicant to have a well-grounded fear, that the first respondent wants to dispossess him of the farm or to disturb his effective control, the applicant must have occupied the farm after following due process.

This is not the situation in this case.

There is also the requirement of the lack of an alternative remedy that the applicant had to satisfy in addition to the other two.

This requirement has not been fulfilled for the simple reason, that, in paragraph 5.7 of the founding affidavit, the applicant states thus:

“I have lodged the (sic) complaint with the Zimbabwe Republic Police who are still handling the matter…,.”

This, in essence, shows that the applicant has initiated proceedings in terms of section 3 of the Gazetted Land (Consequential Provisions) Act.

In terms of that section, at section 3(5) of the Gazetted Land (Consequential Provisions) Act, a provision is made for the eviction of a former owner who has been convicted in terms of that section. This therefore clearly means, that, the applicant has initiated criminal proceedings which will, if the first respondent is convicted, lead to the eviction of the first respondent from the farm.

This, in my view, amounts to an alternative remedy as the relief sought would be achieved through the prosecution of the first respondent in terms of the Gazetted Land (Consequential Provisions) Act.

It is for the aforestated reasons that I find that this application should fail.

I accordingly dismiss the application with costs.

HB48-15 : EBENEZER TRUST vs THE MINISTER OF LANDS AND RURAL RESSETTLEMENT and P. K. MHLANGA N.O. (as Acting District Lands Officer) and RHODIE MASHINGAIDZE and CHIEF MASUKU
Ruled By: MOYO J

This is an urgent application premised on the principle of mandamus van spolie.

The applicant's case is that he has been in peaceful and undisturbed possession of Maleme Farm in the Matobo District of Matebeleland South Province.

In paragraph 29 of the applicant's founding affidavit he states thus:

“That coercion has become so disruptive that the applicant is unable to continue its activities on the farm and the applicant's employees are concerned about their personal welfare. Since 5 February 2015, the third respondent, and certain individuals acting under him, have performed the following acts:

(a) They entered the farm without applicant's knowledge or consent on numerous occasions.

(b) They have locked pumps with their own padlocks and have stolen the pump's crankshaft. The applicant has over US$200,000 worth of chickens which require water.

Without a method of watering the said chickens, the birds will die.

The applicant, and the students at the training institute, have vast market gardening projects which require water.

As the area is arid, without an adequate supply of water, all of those projects will be destroyed.

Already, three hectares of cabbage seedlings have been lost which would have returned USD$15,000 and one hectare of tomatoes has been lost with the value is USD$20,000.

(c) Additionally, the said persons also locked up the gates to my farm with their own locks in an attempt to prevent anyone from entering or exiting the premises.

(d) The third respondent, and those acting under or through him, have instructed my workers to stop working and vacate the property. They have threatened applicant's workers with physical harm if they do not stop.

(e) On the 6 of February 2015, the said persons occupied my homestead and also took occupation of the applicant's office located on the property. The same people have started harvesting and selling the produce that the Trust and the communities were cultivating.”

The applicant approached this court for a spoliation order on an urgent basis for the aforestated reasons.

The background of the matter is that the land in dispute is owned by a Trust and although it was gazetted in 2003, the applicant has been allowed to remain in occupation of the remaining extent of the farm after new farmers were given other lots that were taken off the farm.

There has been numerous agreements and co-operation agreements between the Government of Zimbabwe and the applicant which does community work and assists the community in many different farming projects as well as the running of an agricultural training institute within the same farm.

The fourth respondent, Chief Masuku, advised the court that indeed he was part of a District Lands meeting way back after the farm had been gazetted, which saw it fit to leave the applicant on the farm as the community was benefitting immensely from the Trust.

The third respondent's case is that he was allocated this farm which was gazetted in 2003 and he has attached an offer letter dated 3 December 2014.

HB59-15 : NOMUSA NCUBE (as Executrix Dative of Estate Late Alice Nkala) vs GOODWILL NKALA
Ruled By: MOYO J

I find that the estate is testate for the simple reason that the Letters of Administration state, that, the applicant is an executor testamentary meaning that she was appointed so in terms of a will left by the deceased.Such an opinion is made in the case of Songore v Gweme ...

HH823-15 : AT INTERNATIONAL LTD vs ZIMBABWE REVENUE AUTHORITY
Ruled By: KUDYA J

The answer sought in this appeal is whether, the appellant, a foreign registered company is liable to pay value added tax in Zimbabwe.The appellant disputed liability for value added tax (VAT) arising from the purported importation of goods into and the carrying on of trade in Zimbabwe and appealed against ...

The answer sought in this appeal is whether, the appellant, a foreign registered company is liable to pay value added tax in Zimbabwe.

The appellant disputed liability for value added tax (VAT) arising from the purported importation of goods into and the carrying on of trade in Zimbabwe and appealed against a contrary determination of the respondent.

Introduction

The appellant is an International Business Company incorporated on 19 May 2005 in the British Virgin Islands in Guernsey in the Channel Islands but is not permitted to trade in that jurisdiction. The respondent is a body corporate responsible for the collection, amongst other imposts, of value added tax in Zimbabwe.

The Facts

The original intention of the appellant in Zimbabwe, prior to 1992, was to invest in property and participate in the construction of the Chitungwiza road…,.

Instead, the appellant became a supplier of basic commodities to local companies that included the WG (hereinafter referred to as the holding company).

It concluded an agency agreement with D & T, a subsidiary of the holding company, in 1992.

By 1999, it was supplying basic commodities under a US$10 million line of credit registered with the Reserve Bank of Zimbabwe to the holding company and other local customers…,.

On 1 October 2007, the Governor of the Reserve Bank of Zimbabwe unveiled the Basic Commodities Supply Side Intervention, BACOSSI, facility designed to end the chronic shortages of basic commodities in Zimbabwe…,.

The facility commenced in May 2008 and continued until the introduction of the multi-currency regime on 29 January 2009.

In May 2008, officials of the Reserve Bank of Zimbabwe (RBZ) amongst whom was the Governor and the Senior Division Chief Strategic Planning and Special Projects (SDC) visited the warehouse of D & T in Chitungwiza. The RBZ was referred to the appellant by D & T.

The appellant and the Reserve Bank of Zimbabwe (RBZ) commenced negotiations which culminated in the purchase of the non-Bacossi basic commodities that were in the D & T warehouse valued at US$7,987,207=54. The two parties also concluded an agreement in which the appellant supplied basic commodities to the RBZ, in Zimbabwe, the bacossi goods, valued at US$11,698,174 between July and September 2008.

The Baccossi Agreement was reduced to writing…, but was not signed by the parties apparently because the appellant was unhappy with the preamble to the agreement.

A verbal agreement, purportedly concluded between the Reserve Bank of Zimbabwe (RBZ), represented by the Governor, and the appellant, represented by a named Ukrainian lady, governed the supply relationship between them.

The respondent conducted a tax investigation of the purchases, in foreign currency, of the Reserve Bank of Zimbabwe from the appellant for the period between May 2006 and September 2008. The investigations revealed non-payment of value added tax (VAT) on the supplies made in that period…,.

They also revealed that D & T was paid commission, in terms of an agreement between them, on the invoiced supplies from 1 January 2006 to 31 January 2009.

On 9 February 2009…, the respondent made written demand on the Finance Director of the holding company, who was also the public officer of D & T, for the payment of value added tax (VAT) on the invoiced income paid to the appellant during that period.

On 13 February, a meeting was held at the Reserve Bank of Zimbabwe (RBZ) between the Senior Division Chief Strategic Planning and Special Projects, the investigators of the respondent, and the liaison officer of the appellant, who was also the Sales and Marketing Director of the holding company of D & T, the appellant's agent.

On 12 March, the respondent appointed the CEO of the holding company of D & T as the public officer for the appellant in terms of section 61 of the Taxes Act on the ground that his company was closely linked and connected to the appellant's local trading activities.

The CEO objected to the appointment on 17 and 20 March 2009 on the ground, that, he was not an agent, employee, director, or signatory to the bank account of the appellant; but, the respondent did not relent in its demand.

On 20 March 2009, at the respondent's offices, a meeting was held between three representatives of the respondent and two tax advisors from a local firm of accountants.

In reply to counsel for the respondent's oral submissions, counsel for the appellant disputed that the appellant was represented at the meeting and suggested that the tax accountants represented D & T.

The purpose of the meeting was to get the respondent's version on the value added tax (VAT) issues pertaining to both the appellant and D & T.

The VAT head from the tax advisors provided the respondent with two letters of his firm's mandate to represent the client.

It is inconceivable that he would not have received full instructions from his client, as he indicated, were that client D & T.

I am satisfied, from the heading of the minutes minuted by the tax advisors, that, they represented the appellant and not D & T.

In any event, the briefing given him by the respondent related to the alleged activities of the appellant, including the payment of 0.1% commission on the gross sales of the appellant in Zimbabwe to D & T.

On 30 March, the public officer of D & T disputed the legality of the appointment of his CEO as a public officer for the appellant. He, nonetheless, compiled and delivered the monthly breakdowns of the income received by D & T during the period from January 2006 to 31 January 2009 requested in the letter of 9 February.

On 25 March 2015…, the appellant wrote to the respondent objecting to the appointment of the public officer outside its registered place of business in Guernsey and to the tax liability claim.

The basis of the objection was that it did not maintain offices nor employ staff nor was it a value added tax (VAT) registered operator obligated to charge VAT on goods purchased from its foreign based operations and supplied to clients in Zimbabwe.

The relevant part of the letter reads:

“We object to your claim that we have a tax liability in Zimbabwe as we do not have a self-established presence in the country. Our involvement with Zimbabwe clients, and the West Group, is limited to the supply of our stock to agents who operate on a commission basis to store and handle our stock that we hold in Zimbabwe, for which we have always operated with Reserve Bank Approval.”

The objection by the appellant, of 25 March, and the further objection of its compulsorily appointed public officer, were dismissed by the respondent on 31 March 2009.

On 1 April, the respondent proceeded to appoint the holding company, and its subsidiaries, as an agent for the collection of value added tax (VAT) due from the appellant, purportedly in terms of section 48 of the Value Added Tax Act…,.

On 3 April 2009, the appellant, through its authorised signatories, wrote to the CEO of the holding company appointed as its public officer and copied the letter to the head of investigations of the respondent, and the Senior Division Chief Strategic Planning and Special Projects on the tax enquiry conducted by the respondent disputing tax liability on two grounds:

(i) The first was that it was not the importer; and

(ii) The second was that the sale to the importer, the Reserve Bank of Zimbabwe (RBZ), took place outside Zimbabwe.

I believe exhibit 2 may have been written by the compulsorily appointed public officer for the appellant between May 2009 and 17 June 2009, and not on 15 April 2008, as it is highly unlikely that the author possessed prescient powers to predict the events that were to take place between January and May 2009.

It was addressed to the prospective external legal practitioner of the Reserve Bank of Zimbabwe (RBZ).

The writer summarised the history of the relationship between the appellant and the holding company and one of its subsidiaries, D & T, before and during the bacossi period. He also dealt with the relationship between these parties and the Reserve Bank of Zimbabwe and exonerated the appellant from value added tax (VAT) liability.

In response, on 17 June 2009, the external legal practitioner of the Reserve Bank of Zimbabwe (RBZ) wrote a six page legal opinion to the Senior Division Chief on the US$4m tax dispute….,.

The legal practitioner in question had apparently held a meeting, on 21 April, with the Senior Division Chief of the central bank and two representatives of the holding company. He believed, that, his mandate to protect the interests of the Reserve Bank of Zimbabwe (RBZ) coincided with the interests of the appellant. He had engaged the lawyers of record of the appellant.

He identified the common problem to be the demand for value added tax (VAT) on the appellant in respect of the supply of Bacossi goods and its agent on commission received from the appellant.

Apparently, the appellant declined to supply him with information on its business profile, shareholders and directors, summary of significant business activities in the 12 months to the date of the letter and on the nature and extent of its business activities in Zimbabwe, its certificate of registration, any Board resolutions on Bacossi transactions, and its local call account.

In the absence of this information, he could not state, with certainty, that the appellant was not conducting local trading activities nor exclude it from value added tax (VAT) liability other than on the mere say so of its agent, D & T.

He advised that the Reserve Bank of Zimbabwe (RBZ) was liable for the payment of value added tax (VAT), in local currency, on the basis of the bills of entry that identified it as the importer.

He urged the Reserve Bank of Zimbabwe (RBZ), for strategic reasons that he set out in the opinion, to tender the duty in local currency hoping, that, if the respondent accepted the payment, the appellant would automatically be exempted from liability.

On 1 July 2009, the Senior Division Chief wrote to the appellant's legal practitioner of record. She confirmed the importation of Bacossi goods and the acceptance of liability for value added tax (VAT) by the Reserve Bank of Zimbabwe (RBZ)….,.

On 20 August 2009, three members of the respondent investigations team held a meeting with four RBZ employees at the RBZ amongst whom was the Senior Division Chief (SDC).

In that meeting, the Reserve Bank of Zimbabwe (RBZ) repudiated the concession made by the Senior Division Chief (SDC) and laid liability at the doorstep of the appellant.

However, in view of the national importance of the project and the profile of the major beneficiaries, the Reserve Bank of Zimbabwe (RBZ) resolved to seek exemption for payment of value added tax (VAT) on these goods from the Ministry of Finance by 25 August 2009.

A further meeting was held on 7 October 2009, in the Governor's boardroom at the Central Bank, between the Reserve Bank and the holding company, to discuss the appellant/RBZ value added tax (VAT) liability of US$3.2m….,.

In attendance were the Governor, his advisor, bank secretary, and a strategic planning executive for the Reserve Bank of Zimbabwe (RBZ) and the Sales and Marketing Director, indicated in exhibit 2 as the liaison officer of the appellant, and another officer of the holding company.

Notwithstanding that the respondent was not claiming value added tax (VAT) from the central bank, the Governor prevaricated on whether the Reserve Bank of Zimbabwe (RBZ) accepted liability or not. In one vein he accused the Senior Division Chief (SDC) of erroneously accepting liability for the central bank without his express authority, and, in the other, he was prepared to pay the VAT as long as it was charged in Zimbabwe dollars.

The Sales and Marketing Director for the holding company declined to answer for the appellant insisting that D & T acted as liaison for the appellant as the foreign supplier and local buyers.

The underlying suggestion from her contribution was that the appellant was not liable for value added tax (VAT).

In addition, the concluding remarks of the meeting suggested the existence of minutes of meetings between the Reserve Bank of Zimbabwe (RBZ) and the appellant.

The investigation prompted the respondent to raise against the appellant schedules for outstanding value added tax (VAT) on both the non-Bacossi and Bacossi transactions, initially on 17 March and later on 15 July 2009, in the sum of US$6,302,712=13 inclusive of interest and penalties, which it corrected by the exclusion of zero rated products on 13 October 2009 by reducing the amount to the sum of US$6,249,496=70.

The computations of the principal value added tax (VAT) due in each month for the non Bacossi commodities were in the sum of US$1,198,081=13. The respondent added an equal amount in penalties and a further amount of US$206,799=52 in interest and requested payment of US$2,602,961=79 for the non-Bacossi commodities.

In regards to the Bacossi commodities, it claimed a principal sum of US$1,754,726=10 and a penalty in an equal amount and interest from 21 July 2008 to 23 October 2009 in the sum of US$137,082=72 totalling US$3,646,534=92….,.

The appellant lodged an objection to the assessment in terms of section 32 of the Value Added Tax Act [Chapter 23:12] through its legal practitioners of record on 25 September 2009.

It also applied for condonation from the Commissioner for filing the objection outside the normal time limits. It set out four grounds for condonation and eight grounds of objection.

The respondent dismissed the condonation and disallowed the objection.

The appellant appealed both decisions to this Court on 12 October 2009. The respondent filed its reply on 12 November 2009.

In the objection, the appellant denied ever doing business in Zimbabwe and indicated, that, the local transactions were imports carried out by the holding company, the Reserve Bank of Zimbabwe (RBZ), and other local companies.

It averred, that, the appellant was authorised by the Reserve Bank of Zimbabwe (RBZ) to sell the goods in foreign currency using free funds from non-resident entities.

It supplied goods in bond to its local agent, D & T, for commission.

The local buyer took delivery of the goods after paying the appellant from free funds.

On receipt of payment, the appellant instructed D & T to pay duty and value added tax (VAT) before releasing the goods.

The appellant averred, that, the value added tax (VAT) claim on non-Bacossi goods constituted a double claim for VAT already paid by D & T.

The appellant called the evidence of the founder and chairman of the holding company and director of D & T.

He confirmed the foreign status of the appellant and its relationship with D & T before the Reserve Bank of Zimbabwe came onto the scene.

The holding company, D &T, and the appellant, were not related companies.

The contact between the appellant and D & T was facilitated by his Russian partners in 1992.

The relationship between the appellant and D & T was one of principal and agent.

The Central Bank appeared on the scene in May 2008. At that time, the agent, D & T, imported the goods into Zimbabwe that were supplied by its principal, the appellant.

The Central Bank concluded two agreements with the appellant:

(a) The first related to the purchase of the goods stored in the warehouse that had been imported by D & T, referred to in the appeal as the non Bacossi goods.

(b) The second agreement concerned the Bacossi goods under which the Central Bank directly imported in excess of 400 truckloads of goods from South Africa between July and September 2008.

At Beitbridge, the goods were checked against the bill of entry before they were taken to the bonded warehouse, and, unlike direct home consumption imports, the bill of entry was not surrendered at that stage.

D &T stored the Bacossi goods for the Reserve Bank for a fee.

The relationship between the appellant and D & T was suspended during the duration of the Bacossi imports.

The goods were received and secured by the Reserve Bank of Zimbabwe (RBZ).

The Reserve Bank of Zimbabwe (RBZ) would take the goods from the warehouse once D & T received a release order from the appellant confirming receipt of the purchase price, and, after D & T had paid duty and value added tax (VAT) for the goods.

The clearing agent invoiced D & T for clearance fees; D & T, in turn, added these to the storage fees for the account of the Reserve Bank of Zimbabwe.

He identified the South African export documents and the Zimbabwean import documents encompassing pp33-90 of exhibit 1. Amongst these documents were local bills of entry that identified the importer as the Reserve Bank of Zimbabwe.

The witness confirmed his managing director's assertion, in the letter of 30 March to the respondent, that, D & T was not paid commission by the appellant during the subsistence of the Bacossi imports.

It was on the basis of this evidence, that, counsel for the appellant submitted, that, the sole witness was credible and reliable in all material respects.

I do not agree with the contention by counsel for the appellant, that, the witness was a credible and reliable witness who gave his evidence well.

Under cross examination, he contradicted material parts of his evidence-in-chief.

He abandoned his earlier version that the relationship of principal and agent between the appellant and D & T was suspended during the Bacossi imports. He categorically stated, in cross-examination, that, the relationship did not change for both the Bacossi and non Bacossi imports as the appellant continued to pay D & T, in foreign currency, commission at the rate of 1% of the value of each transaction.

The appellant maintained its grip on the goods in the warehouse and directed its agent to pay duty and value added tax (VAT), and, thereafter, release the goods after confirming receipt of the transaction value of each consignment from the Reserve Bank of Zimbabwe.

He incorrectly stated that value added tax (VAT) was paid for the non-Bacossi goods.

That VAT was never paid was demonstrated by the abandonment of the double claim ground at the hearing of this appeal.

He did not participate in the discussions that culminated in the agreement between the appellant and the Central Bank. He was not privy to the terms and conditions of the agreement. He did not interact with any of the directors and authorised signatories of the appellant.

He had met an officer of the appellant whose name appears in the last paragraph on p112 of exhibit 1 once in Harare.

He was not a director, employee, or official of the appellant or the clearing agent.

His version on the motivation of the clearing agent to invoice D & T rather than the Reserve Bank of Zimbabwe (RBZ) was not confirmed by evidence from the clearing agent or the Central Bank.

He did not produce any evidence to show that D & T included the charges of the clearing agent in the storage fees levied on the Central Bank.

The evidence of the sole witness left gaps that could only be filled by the directors, employees, officials, or agents of the appellant.

His averments preceding the incorporation of the appellant, on 19 May 2005, underscored his unreliability and the need for the testimony of the active officers or agents of the appellant.

It is simply incomprehensible how he could have dealt with the appellant before it was incorporated.

The respondent's investigation established that the Reserve Bank of Zimbabwe (RBZ) purchased non Bacossi goods between May 2006 and June 2008 contrary to his testimony that the purchase started in May 2008.

I am satisfied that he was not a credible and reliable witness.

Rule 5(c) Documents

The respondent did not file Rule 5(c) documents within 14 days of entering his reply as required by Rule 5.

The material correspondence contemplated by Rule 5(c) would consist of the notice claiming the outstanding value added tax (VAT), the letter of objection, and the Commissioner's response to the objection.

Rather, at the hearing, and soon after the appellant had closed its case, counsel for the respondent produced the purported documents from the bar.

The documents consisted of a letter of objection dated 21 October 2014, a set of original value added tax (VAT) assessments issued by the respondent against the appellant on that date for the period May 2006 to August 2008, the letter of objection of 25 September 2009, and the unsigned agreement on the supply of basic commodities between the appellant and the Reserve Bank of Zimbabwe.

It did not file the ruling dismissing the condonation sought and disallowing the objection.

In the letter of objection, the appellant refers to “assessments, the last of which are dated 15 July 2009.”

The earlier assessments of 17 March and 22 May and the letters of 24 June and 10 September 2009, referred to in the notice of appeal, were not produced in evidence nor did they form part of the Rule 5(c) documents or the pleadings.

The respondent must simply comply with the law to obviate unnecessary delays associated with his failure to abide by the law in this regard.

The documents constitute a type of record of proceedings, which helps this Court understand the real dispute between the parties and the basis on which the determination appealed against was made.

That the objection was dismissed on the ground that it was filed out of time was only disclosed in the respondent's reply to the notice and grounds of appeal.

Rule 5(c) documents are simple documents that the respondent always has in its possession - even before filing his reply. This kind of dilatoriness on its part is totally inexcusable.

The respondent is directed to comply with Rule 5(c) in all future cases.

Condonation

At the pre-trial hearing of 17 September 2014, by consent of the parties, the delay in the filing of the notice of objection by the appellant and the failure to file Rule 5(c) documents timeously by the respondent were condoned.

The Issues

The four issues referred for appeal were:

(a) Was the appellant the importer of the goods in question into Zimbabwe?

(b) Does the appellant operate a business in Zimbabwe?

(c) In terms of section 6 of the Value Added Tax Act [Chapter 23:12] who was responsible for the payment of value added tax (VAT) on the imported BACOSSI goods, and, separately, on the imported non-BACOSSI goods?

(d) Was the appellant liable to pay any outstanding value added tax (VAT) in foreign currency?

I proceed to resolve each issue in turn.

Was the appellant the importer of the goods in question into Zimbabwe?

It was common cause, that, the onus was on the appellant to establish the identity of the importer of the basic commodities in question.

Counsel for the appellant submitted, that, the evidence of the sole witness called by the appellant, and the documentation produced, established, on a balance of probabilities, that, the Reserve Bank of Zimbabwe, rather than the appellant, was the importer.

Counsel for the respondent submitted, that, the evidence and documentation showed the appellant as the importer.

The Import Documentation in Exhibit 1

The exportation of goods from South Africa is facilitated by the production of the Republic of South Africa Exchange Control Declaration F178…, also known as the foreign currency payment declaration and the South African bill of entry.

The F178 foreign currency payment declarations in exhibit 1 were marked SL15 to SL20 for ease of reference….,.

These were issued to the appellant for the basic commodities destined for Zimbabwe.

Attached to the foreign currency declarations are commercial invoices of the South African vendor, indicating both the purchaser and vendor and the purchase price….,.

The South African vendor is indicated as the exporter/consignor. The appellant is shown as the consignee.

Attached to some of the foreign currency declaration forms are customs road consignment notes/delivery notes CIF Harare and export clearing and forwarding instructions raised by the transporter.

The vendor is described as the shipper while the appellant is described as the consignee….,.

The customs road manifest placed the responsibility for customs clearance and delivery of the goods under official supervision at the destination on the appellant as consignee.

The appellant paid the South African clearing agent….,.

The customs road freight manifest…, identified the two different clearing agents in South Africa and Zimbabwe. The consignee in Zimbabwe, on one of the road manifests, was D & T.

The Zimbabwe Customs and Excise require the South African exchange control declaration and the commercial invoice of the South African vendor and their attachments for the goods to enter Zimbabwe.

Zimbabwe Revenue Authority Bills of Entry, Form 21, together with commercial invoices issued in the name of the appellant, were presented, accepted, and processed by Zimbabwe Customs at Beitbridge.

The commercial invoices, from the appellant, were generated by the appellant under its letter head….,.

The importer is shown as the Reserve Bank of Zimbabwe (RBZ), delivery CIF Harare to the agent of the appellant on condition the goods are not released unless pre-paid to the offshore account in the appellant's name with the Royal Bank of Scotland.

The local bills of entry, Form 21, are marked SL and WP in exhibit 1….,.

All the SL bills of entry were generated by the clearing agent MCFZ between 25 July and 8 August 2008 while all the WP bills of entry were generated by a different clearing agent, BCS, between 20 and 28 June 2008.

These bills identify the appellant as the exporter/consignor and the Reserve Bank of Zimbabwe as the importer/consignee.

No duty was charged for all the SL consignments while duty was demanded from the declarant/clearing agent for two (2) of the WP consignments.

The ones for which no duty was levied were released on the strength of the customs release orders attached to each bill of entry. There are invoices issued by MCFZ to D & T account Reserve Bank of Zimbabwe (RBZ) for import handling fees….,.

The invoices of 31 July and 26 August 2008 show that the clearing fees submitted to D & T were inclusive of value added tax (VAT).

It was on the basis of the bills of entry that counsel for the appellant submitted that the appellant was not liable for value added tax (VAT) as it was not the importer.

In his supplementary written heads of argument, filed with the leave of the Court on 27 January 2015, he relied on section 12 of the Civil and Evidence Act and R v Karge & Anor 1971 (3) SA 470 (T)…,.

Section 12 of the Civil Evidence Act reads:

“12 Public and Official Documents

In this section —

'public document' means a document —

(a) Which was made by a public officer pursuant to duty to ascertain the truth of the matters stated in the document and to make an accurate record thereof for public use; and

(b) To which the public have a right of access;

'public officer' means a person holding or acting in a paid office in the service of the State or a local authority.

(2) A copy of or extract from a public document which is proved to be a true copy or extract or which purports to be signed and certified as a true copy or extract by the official who has custody of the original, shall be admissible in evidence on its production by any person and shall be prima facie proof of the facts stated therein.”

In R v Karge & Anor 1971 (3) SA 470 (T)…, HIEMSTRA J stated that:

“A public document is one made by a public officer in the execution of a public duty; it must be intended for public use and the public must have a right of access to it (Northern Mounted Rifles v O'Callaghan 1909 TS 174 at pp176-177). The mere production will furnish prima facie proof of the contents, provided that it is the public duty of the person who keeps the register or the records to make entries satisfying himself of the correctness thereof.”

Counsel for the appellant submitted, that, these bills of entry were public documents that were proffered and accepted, in terms of the Customs and Excise Act, established that the Reserve Bank of Zimbabwe (RBZ), and not the appellant, was the importer.

In his response of 4 February 20105, counsel for the respondent conceded, that, the bills of entry were public documents provided by the respondent for the entry of goods into Zimbabwe.

He, however, forcefully argued, that, the other evidence led by the appellant, together with the unsigned agreement of the supply of basic commodities between the appellant and the Reserve Bank of Zimbabwe (RBZ) eclipsed all reference in the bills of entry of the RBZ as the importer.

It is indisputable that Customs officials employed by the respondent are public officers who hold paid office in the service of the State. The bills of entry are public documents whose contents are prima facie correct.

I accept, that, the evidentiary onus to disprove the correctness of the contents of the bills of entry shifted to the respondent.

The respondent used the unsigned agreement as an antidote for the bills of entry.

The preamble indicates, that, the appellant was represented by the liaison officer, who it will be recalled was also the Sales and Marketing Director of the holding company, while the Reserve Bank of Zimbabwe (RBZ) was represented by its Senior Division Chief, Strategic Planning and Special Projects.

The preamble further suggested local incorporation and a local business address for the appellant.

The main body of the agreement identified the products, their quantities and transactional values.

The main features were that the appellant was responsible for delivering the goods CIF Harare or any other destination in Zimbabwe and was to be paid cash on delivery weekly for three (3) months. It was also responsible for weighing, inspection, and packaging at loading sites outside Zimbabwe where the Reserve Bank of Zimbabwe (RBZ) could conduct random inspections at the appellant's expense. The RBZ undertook to facilitate expeditious clearance of the goods at the Zimbabwe ports of entry.

While the respondent had the duty to disprove that the importer was the Reserve Bank of Zimbabwe (RBZ), the true, overall, and unchanging onus to prove the correct terms and conditions in the agreement reached between the appellant and the RBZ lay on the appellant.

In other words, the onus to establish that the terms and conditions in their agreement were different from those captured in the unsigned agreement was on the appellant.

The appellant did not lead any evidence on this aspect.

The evidence placed before the court, by the appellant, was that the agreement was not signed because of what counsel termed “erroneous information in the preamble.”

The erroneous information related to its place of incorporation and business address.

I agree with counsel for the respondent, that, the unsigned agreement placed the duty to import the goods into Zimbabwe on the appellant.

Again, the delivery of the goods, cost insurance and freight Harare, strongly suggests that the appellant imported the goods into Zimbabwe.

It would not make sense for the Reserve Bank of Zimbabwe (RBZ) to undertake to expeditiously facilitate the quick clearance of its imports.

The obligatory cost, insurance and freight Chitungwiza bonded warehouse delivery clause and the expeditious clearance clause suggests that the appellant was the importer.

The strategic planner for the Reserve Bank of Zimbabwe (RBZ) stated, in the minutes of 13 February 2009, that, the appellant was responsible for the importation of basic commodities under the bacossi project and that the goods in the Chitungwiza bonded warehouse belonged to the appellant from where they were received, secured, and dispatched by the RBZ.

She also stated that D & T was a representative of the appellant that looked after all the interests of the appellant in Zimbabwe.

She was supported by other officials of the Reserve Bank of Zimbabwe (RBZ) such as the Special Advisor to the Governor, in the minutes of 20 August 2009, and the Governor on 20 October 2009.

She even intimated the existence of cross-shareholding between the appellant and D & T preceding the bacossi project.

She, however, subsequently confirmed, that, the Reserve Bank of Zimbabwe (RBZ) imported the Bacossi goods from the appellant and accepted liability for value added tax (VAT) in her letter of 1 July 2009.

The concession reinforced the assertions of the public officer for D & T in his letter to the respondent of 30 March 2009, the testimony of the sole witness, the letter of the appellant of 3 April 2009 to the purported public officer and copied to both the Reserve Bank of Zimbabwe (RBZ) and the respondent, the purported public officer's letter to the prospective external legal advisor of the RBZ, erroneously dated 15 April 2008, and that legal advisor's letter to the RBZ of 17 June 2009.

The onus to call evidence to establish what the correct factual position of the Reserve Bank of Zimbabwe (RBZ) was lay on the appellant.

This much was admitted by counsel for the appellant, in his heads of argument, by reference to Commissioner of Taxes v 'A' Company 1979 (1) RLR 29 (A)…,; 1979 (2) SA 409 (RAD)…,; 41 SATC 59 (RAD)…,.

The appellant did not produce the bill of entry from South Africa which would have shown who the exporter of the goods from South Africa was.

The sole witness stated, that, the importer of the non-bacossi goods was D & T.

The definition of 'export' and 'exporter' in section 2 of the Customs and Excise Act [Chapter 23:02] and 'exported' and 'export country' in section 2 of the Value Added Tax Act denote the removal of goods from Zimbabwe.

Exporter is defined in the Customs and Excise Act as “any person in Zimbabwe who takes goods or causes goods to be taken out of Zimbabwe and includes any employee or agent of such person and the owner of such goods as are exported.”

On the other hand, to import is “to bring goods or cause goods to be brought into Zimbabwe” and an “importer in relation to goods includes any owner of or other person possessed of or beneficially interested in any goods at any time before entry of the same has been made and the requirements of this Act fulfilled.”

In my view, the business activities of the appellant fell outside the definition of “exporter” but squarely fit the definition of “importer.”

It was a misnomer to refer the appellant, in the bill of entry, as an exporter.

An importer is identified with ownership or possession of the goods or beneficial interest in the goods before entry and the fulfilment of the requirements of the Customs Act.

Entry is defined, in section 2 of the Customs Act “in relation to clearance of goods for importation, means the presentation in accordance with this Act of a correctly completed and signed declaration on a bill of entry in writing.”

The documents generated in South Africa show that the Reserve Bank of Zimbabwe (RBZ) was not the owner nor possessor nor beneficiary of the goods before the correctly filled and signed bills of entry were presented to customs officials of the respondent.

Rather, these South African derived documents show, beyond even a shadow of doubt, that, the goods were for the benefit of the appellant who owned and possessed them before any of the bills of entry were presented to customs officials.

Even though the sole witness stated that D & T was the importer of the non-bacossi goods, it was clear that it was operating as an appendage of the appellant.

There was preponderance of evidence establishing that D & T acted at all times as an agent importer on behalf of the appellant.

I am satisfied, that, notwithstanding the contents of the bills of entry and other documents complied by or at the instance of the appellant to the contrary, the appellant was the owner or possessor of the goods; who also had a beneficiary interest in them before they entered Zimbabwe; who brought them or caused them to be brought into Zimbabwe.

I hold, that, the appellant was the importer of both the non-Bacossi and the Bacossi goods.

HHB62-15 : MICHAEL BIDDLECOMBE vs THE STATE
Ruled By: TAKUVA J and MOYO J

This is an appeal against the decision of the Magistrates Court sitting at Gwanda, in which the appellant was ordered to stand trial on allegations of contravening the provisions of section 3 of the Gazetted Land (Consequential Provisions) Act [Chapter 20:28] (hereinafter “the Act”).

The factual allegations were, that, on 19 May 2006, the State acquired Famona Farm in terms of section 16(B)(2)(a)(iii) of the Constitution of Zimbabwe by publishing General Notice 128 of 2005 in the Government Gazette (Extraordinary) of the 19th of May 2006.

The appellant then failed to comply with the provisions of section 3 of the Gazetted Land (Consequential Provisions) Act. Specifically, it was alleged, that, the appellant failed to vacate the acquired land within 45 days from the fixed date which was the 20th day of December 2006.

Essentially, the charge was, that, the appellant had continued to occupy the farm without lawful authority.

After the ruling, the appellant appealed to this court.

On 9 September 2013, both parties filed what they termed “Stated case on a point of law arising on appeal.” The document states:

“Background and Accepted Facts

1. On the 29th November 2010, the above cited appeal was called before this Honourable Court.

2. Upon hearing the parties briefly, the court directed that counsel for the respondent must investigate the authenticity of the letters filed of record by the appellant.

3. Such letters related to Famona Farm, the farm in respect of occupation of which the criminal charges against the appellant were levelled, which charges the appellant moved, unsuccessfully, to quash, leading to the present appeal.

4. The letters purported that Famona Farm had been transferred from the control of the Ministry of Environment and Tourism.

5. Further, the letters reported that the Ministry of Environment and Tourism desired to leave the farm, for stated reasons, in the control and administration of the appellant and his company, GAMESTONE SAFARIS.

6. Counsel for the respondent had investigated the letters and can confirm before this Honourable Court, that, the letters have been written with the authority of the Ministry of Environment and Tourism and that this Ministry has consented that the appellant and GAMESTONE SAFARIS remain in occupation and control of the farm.

7. The parties, therefore agree that:

7.1 Famona farm has been acquired by the State;

7.2 The State is now the owner of the farm;

7.3 The administration of Famona Farm, however, has been removed from the Ministry of Lands, Agriculture and Rural Resettlement, to the Ministry of Environment and Tourism;

7.4 The Ministry of Environment and Tourism administers the farm on behalf of the State.

POINTS OF LAW

At the present time, with the leave of this Honourable Court, the parties agree that they will, when the appeal is called, argue only the following points of law:

8.1 Whether the letters produced of record by the appellant, emanating from the Ministry of Environment and Tourism, amount to a 'permit' or other legal authority for the appellant to remain on the farm;

8.2 Whether, therefore, the charges against the appellant were incompetent, standing to be quashed by the trial court, by reason that the appellant had lawful authority to remain on Famona Farm.”

The appellant's argument is two-pronged:

(i) Firstly, he argues, that, he had lawful authority in the form of letters from certain Government departments to remain on the farm.

(ii) Secondly, he relies on the defence of mistake of law.

I will deal with these grounds seriatum, but, before I do that, let me examine the essentials of the offence the appellant was charge with.

Section 3(1) and (3) of the Gazetted Land (Consequential Provisions) Act read as follows:

“(1) Subject to this section, no person may hold, use, or occupy gazetted land without lawful authority;

(2)…,.

(3) If a former owner or occupier of gazetted land, who is not lawfully authorized to occupy, hold, or use that land, does not cease to occupy, hold or use that land after the expiry of the appropriate period referred to in subsection (2)(a) or (b), or, in the case of a former owner or occupier referred to in section 2(b), does not cease to occupy his or her living quarters in contravention of proviso (iii) to section 2(b), he or she shall be guilty of an offence and liable to a fine not exceeding level seven or to imprisonment for a period not exceeding two years or to both such fine and such imprisonment.”

Section 2 of the Gazetted Land (Consequential Provisions) Act, in which the definitions are contained, is also relevant in the following parts:

1. In its definition of lawful authority, as follows;

“'Lawful authority' means -

(a) An offer letter; or

(b) A permit; or

(c) A land settlement lease: and

'Lawfully authorized' shall be construed accordingly.”

2. In its definition of offer letter:

“'Offer letter' means a letter issued by the acquiring authority to any person that offers to allocate to that person any gazetted land, or a portion of gazetted land, described in that letter;” and

3. In its definition of permit:

“'Permit' when used as a noun, means a permit issued by the State which entitles any person to occupy and use resettlement land.”

From the above, it is clear, that, the following are the essential elements of the charge;

(a) The accused must be a former owner or occupier;

(b) Of gazetted land;

(c) Who has not ceased to occupy, hold, or use that land;

(d) After the expiry of the appropriate period referred to; and

(e) Has no lawful authority to occupy or use that land.

In casu, the only issue is whether or not the appellant has lawful authority to occupy or use that land.

It was contended, on the appellant's behalf, that, he had permission to remain on the farm. This permission arose from the various negotiations, representations, and undertakings by Government officials.

The essence of the representations was that the farm would be removed from the control of the Ministry of Lands, Agriculture and Rural Resettlement, the acquiring authority, to the control of the Ministry of Environment and Tourism because of the business operations carried out on the farm.

Further, an undertaking was then made to the appellant and the company, that, upon such transfer, the Ministry of Environment and Tourism would sign a 25 year lease with the appellant.

The appellant attached the following correspondence by consent of the respondent:

1. Appendix 1, a letter, dated 1 November 2007, advising the appellant of the initiative to transfer the farm from the Ministry of Lands, Agriculture and Rural Resettlement, to the Ministry of Environment and Tourism;

2. Appendix 2, a letter from the Director General of the Zimbabwe Parks and Wildlife Management Authority, confirming the strategic location of and business at the farm on 18 February 2008.

3. Appendix 3, a letter, dated 9 November 2010, served as apparent from the stamp and signature acknowledging receipt of a copy on the Minister of Lands and Rural Resettlement on 9 November 2010, which advised that a 25 year lease was being prepared in favour of the company.

4. Appendix 4, letter from the appellant, dated 16 November 2010, accepting the offer of a 25-year lease.

5. Appendix 5, letter, dated 20 February 2012, advising that deliberations were being held between the Ministries of Lands & Rural Resettlement and Environment and Tourism, concerning the farm in issue.

6. Appendix 6, a letter, dated 12 July 2012, advising that the farm had been formally transferred from the control of the Ministry of Environment and Tourism.

The respondent, while acknowledging the authenticity and sources of the above letters, insisted, that, the appellant did not have lawful authority because he does not possess an offer letter issued by “the acquiring authority” i.e. the Ministry of Lands.

However, the respondent conceded, that, a proper interpretation of the definition of a permit in the Gazetted Land (Consequential Provisions) Act is that it can be issued by “any State organ” unlike an offer letter that can only be issued by the “acquiring authority.”

Put differently, it was conceded, that, the definition of a 'permit' is wide.

In my view, the land reform policy is multi-faceted in that it focuses on different uses of acquired land.

What happens in practice is that once land is gazetted and acquired by the State through the “acquiring authority” that authority can transfer the land to another ministry for occupation and use in accordance with that ministry's requirements and needs.

Gazetted land, for example, can be transferred from the Ministry of Lands to the Ministry of Local Government for urban expansion. It can also be transferred to the Ministry of Environment and Tourism in order to boost or promote proper management of Government's wildlife policy.

For these reasons, the argument, that, notwithstanding such transfers, the Ministry of Lands retains the mandate to authorize the use and occupation of such transferred land becomes untenable, not only because it defies logic and common sense, but, because it contradicts the clear meaning of the definition of the word 'permit' in the Gazetted Land (Consequential Provisions) Act.

In casu, the inter-ministerial process has since been finalised in July 2012, as seen from appendix 6.

As matters stand, the farm in issue is now under the control of the Ministry of Environment and Tourism, which, based on their business operations and record, is willing to permit the appellant and the company to occupy and run the farm on the basis of a twenty-five year lease.

In view of the wide definition of the word permit, I find that the letters of 16 November 2010 and 12 July 2012, in particular, constitute a permit as defined in section 2 of the Gazetted Land (Consequential Provisions) Act.

Consequently, the appellant had lawful authority to occupy and use the farm in issue.

As regards the second ground of appeal, the contention is that the appellant was misled into breaching the provisions of the Gazetted Land (Consequential Provisions) Act by Government officials.

The argument is, that, subjectively, the appellant believed, based on what was stated and undertaken to him, that, he had the right to remain on the farm. He believed that all steps requisite to the regularization, or formalization of his stay were being taken. Indeed, a firm decision to transfer control of the farm from one Ministry of another was taken in July 2012.

It is trite law, that, while ignorance of the law is generally not an excuse, a person may be excused from criminal liability where such a person has been misled into breaching the law by Government agents: see S v Davy 1988 (1) ZLR 386 (SC) where GUBBAY JA…, stated as follows:

“It necessarily follows, that, in my opinion, the rule that ignorance or mistake of law is no excuse which judicial officers have applied for so long in this country in conformity with both English Law and the decision of the South African courts prior to the advent of de Blom's case supra remains valid.

Its strength has hardly been shaken.

It is, however, subject to the exception, that, where the accused acted upon incorrect advise as to the law given by a Government official who is primarily responsible for the administration of the particular statute to which the matter relates, his ensuing mistake of law is a good defence: see S v Zemura, supra at 377E–G.

As expressed by LEWIS AJP in S v Bledig & Anor 1974 (1) RLR 100 (AD) at 109A:

'There is something in the nature of an estoppel present when the State prosecutes a person for certain conduct when he has been induced by advice received from a responsible representative of the State to embark on such conduct.'

Clearly, the exception is grounded in reasons of public policy.

Where the State has misled a man into a contravention of the law, as a matter of public policy, he should be entitled to an acquittal. But, care must be taken not to extend the exception beyond the strict limits of Zemura's case, for, to do so, would be 'extremely dangerous and would tend to frustrate the enforcement of statutory provisions:' see Bledig's case supra at 108 in fine.”

In casu, it is clear from the numerous correspondence referred to that the appellant was indeed misled by Government officials into breaching the provisions of the Gazetted Land (Consequential Provisions) Act.

It is unfortunate, that, the Ministry of Environment and Tourism has taken a long time to finalise the 25 year lease with the appellant. However, this bureaucratic delay is not of the making of the appellant, and should, therefore, not place him at any disadvantage: see DPP and Minister of Justice and Constitutional Development v Phillips (803/2011) [2012] ZASCA 140 (28 September 2012).

I find, therefore, that, the appellant's occupation of the farm was not illegal on the grounds that he had lawful authority to remain on the farm.

Accordingly, the appeal is allowed.

HMA21-19 : MR MBOZVI vs CHENGETAI SIDHUNA
Ruled By: MAWADZE J and MAFUSIRE J

The dispute between the parties centred on a property described as Stand 238 Phase 1 Checheche (“the property”). It is one of those council-owned township properties that local authorities sell on a rent-to-buy basis. It is under the Chipinge Rural District Council.

In the court a quo, the respondent (“Chengetai”) sued the appellant (“Mbozvi”) for eviction and holding over damages. The court granted the orders.

Mbozvi appealed. We heard argument on 27 March 2019 and reserved judgment.

This now is the appeal judgment.

In her claim, Chengetai alleged that Mbozvi “…, unilaterally entered…,” her property in January 2017 without her authority. She alleged she had acquired the property in November 2007; that she had partially developed it to window level but that the defendant was staying there illegally and without paying rentals.

The claim was poorly presented. The drafting was sloppy. For example, there was no reason why Mbozvi's name was not cited in full when all his particulars were available.

But, that is besides the point.

In his defence, Mbozvi took an objection in limine. He said Chengetai had no locus standi in judicio to evict him or to seek holding over damages because the property was his.

But, it seems this objection went nowhere. It seemed abandoned or forgotten somewhere along the way. It was not even on the list of issues at the pre-trial conference.

The objection was ill-conceived anyway, especially if regard is had to the nature of the claim and the nature of the defence.

On the merits, Mbozvi denied that he had “…, unilaterally entered…,” the property. He alleged he had lawfully acquired it from one Tafirenyika Maturo (“Tafirenyika”), to whom Chengetai had transferred her right, title, and interest.

In its judgment, the court a quo ruled, that, there had never been a transfer from Chengetai to Tafirenyika but that what had happened had all been a fraudulent scheme to strip Chengetai of her ownership. As such, since no thief or fraudster can in law transfer rights in a thing, Mbozvi's claim to the property was held to be defective. The court also ruled that Chengetai was entitled to holding over damages.

The case went like this.

Chengetai opened and shut her case with only the evidence from herself. She said the property was allocated to her by the Chipinge Rural District Council in 2007. She produced the offer letter from Council dated 29 November 2007. All this was common cause.

But, there was a subtle detail on the letter that was at war with her case.

The letter had two parallel lines drawn in long hand running diagonally across it and between which the words “Stand No.238 PHASE 1” were inscribed, also in long hand. Mbozvi said that was the evidence of the cession of the property from Chengetai, or of the original allocation to her having been cancelled. She denied it. But, she proffered no other explanation for that endorsement.

In a boxing match, that would be a point for Mbozvi.

Chengetai said she had submitted some developmental plans to the Council for the construction of a 3-roomed cottage on the property. As proof, she produced some drawings endorsed with a date stamp from the Chipinge Rural District Council in 2012.

But, again, a subtle detail on the drawings contradicted the flow of her evidence.

Mbozvi said the plans were for a different property, not Stand 238. Indeed, the drawings cited a different property. They were titled “PROPOSED COTTAGE ON STAND No.120 INFILL CHECHECHE GROWTH POINT”. Chengetai said the reference to Stand 120 was a mistake which the Council had promised to rectify but had never done.

But, again, in a boxing match, this would be another point for Mbozvi.

Beyond this evidence and these two documents, Chengetai's evidence proved nothing further. Everything else she said was a bare denial of the cogent and overwhelming evidence by Mbozvi through himself and his very relevant witnesses, namely, Tafirenyika, his wife Leona or Loren Chiona (“Leona”) and Mbozvi's friend, Collen Gapara (“Collen”) who had facilitated the sale deal between Tafirenyika and Mbozvi.

Mbozvi's case was this.

He heard the property was on sale. He went to inspect it. He liked it. Together with a sister and his wife, they went to inspect Council records. These reflected Tafirenyika as the “owner”. Tafirenyika worked and stayed in South Africa. Mbozvi called him. They agreed on a purchase price of fifty thousand Rand (R50,000).

Tafirenyika referred them to his wife, Leona, whom he said had all the authority to represent him.

The sale deal was concluded. The purchase price was paid. They went to Council offices for the usual cession. This was done.

He took occupation in 2015 and started building the partially constructed house. He completed the structure; tiled the floors; installed water and electricity; planted some trees and flowers around the yard; put up a security wall along the perimeter and started staying there from January 2016.

Until he received her summons, in March 2018, he had never heard of Chengetai and her claim to the property.

To all that, Chengetai denied ever selling the property to anyone.

She denied ever dealing with Tafirenyika or his wife, Leona. She was adamant none of them was known to her.

Mbozvi set to demolish her case. He called Collen.

Collen's evidence corroborated Mbozvi's in relation to the sale by Tafirenyika. One important aspect of that corroboration was that it was his advice to Mbozvi to clear the property first with the Council before committing himself to Tafirenyika. He was present at the Council offices when the records were pulled out and inspected. They all reflected Tafirenyika as the “owner”. Another important aspect of the corroboration was that when Mbozvi took occupation there was a partially built structure which Mbozvi completed in 2016.

Even the court a quo accepted Collen gave his evidence very well and that he remained unshaken under cross-examination.

But, the sale and transfer from Tafirenyika to Mbozvi was less contentious. Fireworks were in respect of the sale and transfer from Chengetai to Tafirenyika.

Chengetai swore she knew nothing about it or that Tafirenyika and his wife, Leona, were ever known to her.

So, Mbozvi called Leona.

She stayed at Checheche Growth Point. She said it was Chengetai herself that had come to her house, personally, on 4 February 2015, to inform her that she had sold the property to her husband, Tafirenyika. Tafirenyika had already telephoned her (Leona) about the deal. Before coming to Leona's house, Chengetai had first telephoned her for directions. The purpose of Chengetai's visit was to arrange transfer of cession at the Council offices. They agreed on a date, 6 February, i.e. two days later.

Leona's evidence, on the cession transfer at the Council's office, was quite elaborate. In brief, it was this:

She had her husband's national registration particulars. Chengetai had hers. Together, they were moving from office to office signing documents. Chengetai would sign first. She would sign in place of Tafirenyika.

After completion of the sale and transfer she and Chengetai actually became friends.

Next, Mbozvi called Tafirenyika.

His formal evidence was that he worked and lived in South Africa. He was married to Leona under customary law. They had three children together. He was the one who sold the property to Mbozvi. Everything was done through Leona, his wife, whom he had granted all the authority.

Critical aspects of Tafirenyika's evidence were these:

He met Chengetai for the first time in South Africa. He did not know her before. She had been in the company of two people, one of them Zviedzo Chipfunde (“Zviedzo”), an old school mate of his. Zviedzo was then married to Chengetai. He told him Chengetai was selling a Stand for thirty thousand Rand (R30,000). He reached an agreement with her. He paid her a deposit of twenty thousand Rand (R20,000). The balance of ten thousand Rand (R10,000) would be paid on the transfer of cession.

Tafirenyika's critical evidence continued:

Towards December, Chengetai was demanding the balance of the purchase price. He told her they needed to change ownership first. They agreed that since he was busy he would give her his wife's contact details through whom the transactions would be carried out.

Back in Zimbabwe, Chengetai did contact Leona and went to see her at home. Together, they arranged and facilitated the change of ownership. Chengetai subsequently returned to South Africa and collected the balance of R10,000 after both she and Leona had confirmed the cession at Council offices.

To all that testimony, Chengetai's position was just a bare denial.

She denied she knew Tafirenyika or his wife, Leona. She denied she had sold her property to them. She denied she had been to South Africa during the period mentioned by Tafirenyika. She denied she had received that kind of money from Tafirenyika or anyone else in connection with the property. She denied the cession at the Council offices and alleged that all the documents suggesting a cession of rights by her were forgeries or fraudulent.

Mbozvi's witnesses were forthright, straightforward, and unshaken. Cross-examination was lame.

For example, counsel for Chengetai, put it to Tafirenyika, that, Leona was a mere concubine of his since there was no registered marriage between them. He pestered Tafirenyika why he did not apply to be joined to the proceedings if ever he wanted to defend his sale of the property to Mbozvi and protect him!

This was absolutely ironic.

It was the process issued by counsel for Chengetai himself, on behalf of Chengetai, and his presentation of the case that were patently incompetent.

For example, the summons excluded very relevant parties like Tafirenyika and the Chipinge Rural District Council, the true owner of the property, and the records for which reflected Tafirenyika as the owner. Not only that, but Chengetai's case was closed with no evidence from any of the Council officials testifying on what had really transpired regarding the property and whether there had really been a fraud.

There was an aspect of Mbozvi's evidence and that of his witnesses that left Chengetai rather exposed.

They asked how on earth they could have ever guessed Chengetai's national registration particulars which were inserted on the cession documents. At first, she denied they were hers. But, she subsequently admitted them. She gave no explanation how Mbozvi and his witnesses could have got them.

Mbozvi's documentary evidence should have won him the case. In a boxing match, it would be the technical knock-out punch. It was completely in consonant with his testimony and that of his witnesses.

Firstly, he relied on Chengetai's own original offer letter from Council and highlighted the cancellation endorsed on it. Next, he discredited the drawings or building plans as belonging to a different property altogether.

The critical cession document from Chengetai to Tafirenyika was produced through Leona.

It was one of those standard cession forms used by rural district councils which are printed on council stationery. Blank spaces were completed in long hand. It had four sections: the first for completion and signing by the cedent; the second for completion and signing by the cessionary; the third for official use, and the fourth, and last, for approval by the Minister of Local Government.

Completed, the relevant portions of the cession document read as follows:

“The undersigned…,___CHENGETAI SIDHUNA___, National Reg. No: ___13–174976 A 13___ do hereby cede, assign and transfer to…,___MATORO (sic) TAFIRENYIKA___ Nat Reg No: ___13 – 200661 T 13___ All my rights and title to and interest in lease number ___238___ at ___CHECHECHE___ Business centre in Chipinge Rural District from ___6___ day of ___FEBRUARY 2015___.”

Above the word “CEDENT” was a signature, in very clear print: “C h e n g e t a i” with the letter “e” quite distinct and somewhat stylish. There were also signatures by two witnesses.

The section for the cessionary read as follows:

“I … ___MATORO (sic) TAFIRENYIKA___ Nat Reg No ___13–200661 T 13___ Address ___1107 Phase 2 CHECHECHE___ Do hereby accept transfer of the Agreement of number _____(blank)____ Business Centre in Chipinge Rural District, as from the ___6___ day of ___February 2015___”

As with the cedent, the cessionary's signature was a distinct name in print “LOREEN CHIONA”. There were also signatures by two witnesses.

The last two sections of the cession document, which were for official use and approval, were left blank.

Counsel for Chengetai latched onto this.

He said the alleged cession was incomplete and unapproved....,.

The court a quo accepted the argument. It fell into error.

There is nothing magical about a cession of rights. In Chauke & Anor v Mangena HMA09-19 in which a similar argument arose, I said there is wise Shona saying: “kupedzera miseve pamakunguwo idzo hanga dziripo!” meaning, wasting all the arrows on worthless crows when more treasured guinea fowls abound: in other words, to major in minors.

Simply put, a cession is the transfer or giving up of rights and interest by one party which the other party accepts or receives. The cession is pivoted on an agreement that is legitimate. The transferor or giver of the right is the cedent. The receiver is the cessionary.

No formalities are required for a valid cession: see R.H. CHRISTIE: Business Law in Zimbabwe, Juta & Co Ltd, 1998…,.

In Mberi v Mbewe & Anor HH420-15, after reviewing a number of cases on the point such as Gomba v Makwarimba 1992 (2) ZLR 26 (SC); Hundah v Murauro 1993 (2) ZLR 401 (SC); Pedzisa v Chikonyora 1992 (2) ZLR 445 (SC) and Magwenzi v Chamunorwa & Anor 1995 (2) ZLR 332 (S), I said, in a great number of cases of this nature, the local authority, which is the true owner of the property, is little concerned with what the tenant-to-buy does with his rights and interest in the property.

The local authority normally consents in advance of the alienation or disposal of such rights, or it subsequently ratifies. The consent can be tacit or express.

In the present case it was both.

That, when Mbozvi and his team went to inspect the Council records, before he committed himself to Tafirenyika, they found the property reflecting Tafirenyika as the owner was not challenged.

Thus, unless the Council had given tacit approval to the sale from Chengetai to Tafirenyika, there could be no explanation why the records were in Tafirenyika's name.

But, there was more.

Produced in evidence was a very detailed rent-to-buy agreement between the Chipinge Rural District Council and Tafirenyika in respect of the property. It was signed by Leona as lessee and by Chengetai as a witness.

Nothing could be better evidence of the express consent by the local authority and of the transfer of rights from Chengetai to Tafirenyika.

The court a quo said all these documents were a fraud to strip Chengetai of her ownership of the property....,.

Counsel for Chengetai successfully persuaded the court a quo to find meaning and substance in a letter from the Chipinge Rural District Council, written to himself by the Growth Point Manager on 10 April 2018 and which he had solicited for.

Relevant portions of that letter read as follows:

“Your letter dated 25 March, 2018 refers. Ms Chengetai's Sidhuna's letter on same subject dated 18 September, 2017 also refers.

Please note that the Stand cession process is a long and arduous process which takes place at five different levels, namely, the sub-office at Checheche, then Heads of Departments have to consent to it before submitting to ZIMRA. After ZIMRA's concurrence, the matter will finally come back to the Lands and Assets Office at the Main Office before being finally presented to the Chief Executive Officer to complete the signing of a lease agreement thereto.

As you observed, there is no complete cession yet and there is no lease agreement yet between Council and the incumbent, Tawanda Mbozvi. The forms are still at the Checheche sub-office, held back because of an incomplete process. Implicitly, the first level has therefore not yet been satisfied by the parties to warrant it to move up to the second stage where the Heads of Departments will peruse the documents before they can be passed on to ZIMRA.

The Stand is therefore not yet formally…, in the buyer's or cessionary's ownership, albeit the nominated cessionary already having been clearly cited for practical functional purposes – and this we always do as instructed and agreed between the seller and the buyer. In the case of any objection by the parties, we always delay or defer process until we are granted a green light by the parties…,.

In the matter at hand, there is agreement between the incumbent, Tawanda Mbozvi, and Tafirenyika Matoro who claims to have bought the property from Chengetai Sidhuna…,. The dispute, therefore, lies between Chengetai Sidhuna and Tafirenyika Matoro who passed ownership of Sidhuna's property to Mbozvi.

Essentially, therefore, Council fully recognises Sidhuna's objection to processes that were transacted in our offices. She is the holder of the more critical Council stand documents and her consent to the process is therefore paramount.

To that effect, Council has deferred the cession process of Stand 238, given the apparent validity of Chengetai Sidhuna's formal complaint since September 2017.

By copy of this letter, we advise the three parties on our records (being Mbozvi, Matoro and Sidhuna) to convene or otherwise resolve matters and instruct us accordingly….,.”

The letter is an example of double-speak....,.

The cession from Chengetai to Tafirenyika was complete as signified by the lease-to-buy agreement between the Council and Tafirenyika. The cession between Tafirenyika and Mbozvi was complete as signified by, firstly, a handwritten agreement between Tafirenyika and Mbozvi, and, secondly, the cession addendum from Tafirenyika to Mbozvi, both in December 2015.

All these documents were part of the Council records.

View Appeal
HH264-21 : MUSA KIKA vs MINISTER OF JUSTICE LEGAL & PARLIAMENTARY AFFAIRS and THE CHIEF JUSTICE HONOURABLE LUKE MALABA N.O. and OTHERS
Ruled By: ZHOU J, CHAREWA J and MUSHORE J

IntroductionThis judgment is in respect of two matters, HC2128/21 and HC2166/21. The two matters were heard together because the substance of their complaints is the same.Both matters were brought by way of application. HC2128/21 was instituted as an urgent court application while HC2166/21 was brought as an urgent chamber application.Both ...

Introduction

This judgment is in respect of two matters, HC2128/21 and HC2166/21. The two matters were heard together because the substance of their complaints is the same.

Both matters were brought by way of application. HC2128/21 was instituted as an urgent court application while HC2166/21 was brought as an urgent chamber application.

Both applications are opposed by some of the respondents.

Opposing papers, answering affidavits, and heads of argument were filed following a case management meeting with the parties representatives at which the dates for filing the papers were set by consent.

In case no. HC2128/21 the applicant, a legal practitioner and director of the Zimbabwe Human Rights NGO Forum, cited the Minister of Justice, Legal and Parliamentary Affairs, and all the judges of the Constitutional Court and Supreme Court as well as some of the judges of the High Court, on the basis that they are acting judges of the Supreme Court or have been called upon to act as such.

The judges were cited in official capacities.

The Judicial Service Commission (JSC) was joined in the proceedings, at its instance, at the case management conference.

In HC2166/21 the respondents cited are the Judicial Service Commission (JSC), the Chief Justice of Zimbabwe, Honourable Luke Malaba N.O. and the Attorney General N.O. The applicants in that case are Young Lawyers Association of Zimbabwe and Frederick Charles Moses Mutanda, a liberation war veteran.

Background

On 7 May 2021, the Constitution of Zimbabwe Amendment (No.2) Act 2021 became law after being assented to by the President. The contentious aspects of the Amendment Act which are the subject of the instant applications are found in its section 13.

That section repealed section 186 of the Constitution 2013 and substituted it with a new section 186.

Upon gathering that section 186 of the Constitution, introduced by the Amendment, would apply to the second to eighteenth respondents (Luke Malaba, Elizabeth Gwaunza, Paddington Garwe, Rita Makarau, Anne-Mary Gowora, Ben Hlatshwayo, Bharat Patel, Antonia Guvava, Susan Mavangira, Chinembiri Energy Bhunu, Tendai Uchena, Nicholas Mathonsi, Charles Hungwe, Felistus Chatukuta, Alfas Chitakunye, Samuel Kudya and Lavender Makoni) the applicants instituted the two applications. The applicant in Case No. HC2128/21 seeks the following relief:

“IT IS DECLARED THAT:

1. In accordance with provisions of sections 186(1)(a) and 186(2) (of the Constitution of Zimbabwe 2013) in their original form and notwithstanding provisions of Constitutional Amendment Number 2, second to eighteenth respondents hold office they reach the age of seventy years, whereupon they must, by operation of law, retire.

2.The attempt to subvert the position encapsulated in the "original" section 186(1)(a) and 186(2) of the Constitution of Zimbabwe 2013 is contrary to law and therefore in breach of applicant's right to the protection of the law as set out in section 56(1) of the Constitution of Zimbabwe 2013.

IT IS CONSEQUENTLY ORDERED THAT:

3. LUKE MALABA, must or did, at midnight on 15 May 2021, cease to hold the office of CHIEF JUSTICE OF ZIMBABWE.

4. Any action, conduct, or deed of LUKE MALABA post the 15th of May 2021, purportedly as CHIEF JUSTICE OF ZIMBABWE, is null and void and of no effect.

5. ln accordance with the provisions of section 181 of the Constitution 2013, with effect from midnight on the 15th of May 2021, ELIZABETH GWAUNZA became/becomes the ACTING CHIEF JUSTICE OF ZIMBABWE until such a time as a substantive CHIEF JUSTICE OF ZIMBABWE is appointed.

6. In accordance with the provisions of section 181 of the Constitution 2013, with effect from midnight on the 15th of May 2021, PADDINGTON GARWE became/becomes the ACTING DEPUTY CHIEF JUSTICE OF ZIMBABWE until such a time as a substantive DEPUTY CHIEF JUSTICE OF ZIMBABWE is appointed.

7.There shall be no order as to costs."

During argument, counsel for the applicant abandoned the relief sought in paragraph 6 of the draft order and moved that the draft be amended accordingly.

We point out, that, notwithstanding the statement suggesting that what is being sought in paragraphs 3-7 of the draft order is consequential relief, the relief is clearly in the form of a declaration.

The second to eighteenth respondents did not file opposing papers.

They will therefore be taken not to have opposed the application: see Prosser & 35 Others v Ziscosteel Company Ltd HH201-93 and Panganai and 20 Others v Kadir & Sons (Pvt) Ltd HH26-95.

We do not accept the submission by their counsel that they oppose the application without filing opposing papers. This is because the directions issued on 12 May 2021 required the respondents to file opposing papers if they were opposing the application. Their grounds of opposition would have to be contained in the opposing affidavits.

ln Case No. HC2166/21 the applicant sought declaratory relief as follows:

“IT IS DECLARED THAT:

1. The first respondent (Judicial Service Commission) in failing to activate the provisions of section 180 of the Constitution of Zimbabwe Amendment (No.20) Act 2013 and/or the provisions of section 180 of the Constitution of Zimbabwe as amended by Constitution of Zimbabwe Amendment (No.2) Act 2021 (No.2 of 2021) diligently and without delay violated section 324 of the Constitution of Zimbabwe as amended.

2. The second respondent (Chief Justice Luke Malaba) cannot, by virtue of section 328(7) of the Constitution of Zimbabwe, as amended, benefit from the term limit extension as introduced by an amendment of section 186 by the Constitution of Zimbabwe Amendment (No.2) Act 2021.

3. As a consequence of 2 above, the second respondent shall vacate office as the Chief Justice of Zimbabwe on (sic) midnight of 15 May 2021.

4. Any action, conduct, act, or deed of second respondent post the 15th of May 2021, purportedly as Chief Justice of Zimbabwe, is null and void and of no force or effect.

5. Any attempt to continue in office by second Respondent as Chief Justice of Zimbabwe and/or any continuation in office by second respondent, purportedly as Chief Justice of Zimbabwe, violates applicants right of access to a court of law established by law and applicants right to protection of the law in accordance with section 69(4) and section 56(1) of the Constitution 2013 as amended.

6. The second respondent, in any event, can no longer be a judge of the Constitutional Court for more than 15 years in violation of section 186(1) of the Constitution 2013 as amended.

7. ln the alternative, section 14 of the Constitution of Zimbabwe Amendment (No.2) Act 2021 (No.2 of 2021) is invalid for violating section 56(3) of the Constitution 2013 and is accordingly struck down.

8. There shall be no order as to costs."

The relief set out in the first paragraph was not persisted with as it was predicated upon a misreading of the Constitutional provisions pertaining to the appointment of a Chief Justice in Zimbabwe.

The applicants were under the mistaken belief that the first respondent, the Judicial Service Commission (JSC) had the mandate to call for candidates to participate in an interview.

Section 180 of the Constitution provides that the Chief Justice is appointed by the President after consultation with the Judicial Service Commission (JSC).

The relief sought in paragraphs 2, 3, 4 and 5 is the same one being sought by the applicant in HC2128/21 save for the reference to section 69(4) of the Constitution.

The relief sought in paragraph 6 of the draft order was abandoned during argument. Also, the applicant did not make any submissions in support of the alternative relief being sought in paragraph 7 of the draft order.

We take it that this relief, seeking the declaration of invalidity in respect of section 13 (which was incorrectly referred to as section 14) of the Constitution of Zimbabwe Amendment (No.2) Act 2021, is not being persisted with.

Preliminarv Issues and Obiections

The parties raised preliminary issues and objections:...,.

Whether the Matter has Become Moot

The first respondent in HC2128/21 and the third respondent in HC2166/21 contend, that, the dispute between the applicants and second respondent has become moot by reason of the first respondent's term having been extended prior to the hearing of the matter.

It is common cause, that, a letter was written on behalf of the President on 11 May 2021, the same day that the first application was instituted. The letter was produced as an annexure to the opposing papers for the Judicial Service Commission (JSC). In terms of the letter, the President agreed to extend the second respondent's continued stay in office as Chief Justice with effect from 16 May 2021.

The doctrine of mootness is one of the prudential considerations on the basis of which, on public policy considerations, a court may decline to exercise its jurisdiction to determine a matter which has come before it. This would arise where there is no remaining triable issue. A case is moot and therefore not justiciable if it no longer raises an extant or live dispute, harm, controversy or threat of prejudice to the applicant: see S v Dlamini; S v Dladla; S v Joubert; S v Schietekat 1999 (4) SA 623.

ln the case of National Coalition for Gay and Lesbian Equality and Anor v Minister of Justice and Ors 1999 (1) SA 5 the Court stated, that, a matter ceases to be justiciable on the ground of mootness if it “no longer presents an existing or live controversy."

The doctrine is applicable where a matter is brought to court too late, when the issues to be determined have been resolved, or, as is sometimes said, when the horse has already bolted out of the stable: see, for example, De Funis v Odegaard (1974) 415 US 312 a case in which the applicant challenged the decision of the Admission Committee of the University of Washington Law School to deny him admission. He alleged that he had been denied enrolment on grounds of racism. By the time that the matter got to the Supreme Court, the Law School had admitted the applicant as a student and he was now registered for his final quarter in the Law School. The Supreme Court of the US held that it could not consider the substantive constitutional issues raised because the controversy had been resolved.

The jurisprudential rationale for the doctrine, as explained in the case of JT Publishing (Pty) Ltd and Anor v Minister of Safety and Security and Ors 1997 (3) SA 514, Courts should avoid deciding points that are "abstract, academic or hypothetical."

In casu, the dispute remains alive notwithstanding the writing of the letter of 11 May 2021.

The issue of whether section 186 of the Constitution 2013 has the effect of extending the tenure of office of the second to eigthteenth respondents as judges beyond the age of seventy years remains alive. The question of the retirement age for the second respondent, and the other judges of the Constitutional Court and Supreme Court, was not resolved by that letter.

For these reasons, the matters raised are not abstract; they are not moot. The objection must therefore fail.

HMA54-19 : TANDIWE MHLANGA vs ZIMBABWE LAND COMMISSION and MINISTER OF LANDS, AGRICULTURE & RURAL RESETTLEMENT and MUNASHE SHOKO
Ruled By: MAFUSIRE J

This was an opposed application. The original and main dispute was between the applicant and the third respondent. But, in this particular application, the applicant sought a remedy against the first and second respondents.

I guess the third respondent was cited merely as a nominal respondent being so much of an interested party.

The applicant captioned her application as one in terms of section 4 of the Administrative Justice Act [Chapter 10:28]. She complained that, being administrative bodies and therefore entities governed by that Act, the first and second respondents had failed to adhere to the standards set out in section 3 of the of the Administrative Justice Act. Briefly, these are:

(i) The right of a person to receive adequate notice of the nature and purpose of any action proposed to be taken by an administrative body;

(ii) The right to a reasonable opportunity to make adequate representations; and

(iii) The right to adequate notice of any right of review or appeal where applicable.

In terms of section 4 of the Administrative Justice Act, an aggrieved person has the right to approach the High Court for relief.

The details were these:

The applicant was quarrelling with the third respondent over a piece of sugar cane land on which they had been allocated by Government in terms of its land reform programme. The applicant had an offer letter dated 2004 over a piece of land that was plus or minus 50 hectares in extent. The third respondent also had an offer letter issued sometime in 2017 over a piece of land plus or minus 21 hectares in extent.

The applicant claimed the 21 hectares offered to the third respondent had been carved out of her own 50 hectares without due process.

She said, in September 2017, the third respondent, buoyed by that recent offer letter to him, had tried to force his way onto her land, yet, for thirteen years, she had been growing sugar cane undisturbed on the entire land - including the 21 hectares allegedly offered to the third respondent unprocedurally.

In September 2017, the applicant brought an urgent chamber application against the third respondent for an interdict to bar him from interfering with her farming operations on the disputed land.

I heard it. I never had to decide the matter. The parties agreed to an order by consent.

Essentially, the agreement was to have the matter referred to the first respondent for determination. The first respondent is the proper forum for such disputes. It is a constitutional body. In terms of section 297 of the Constitution, it is empowered to investigate and determine complaints and disputes regarding, among other things, the allocation of agricultural land.

On 14 September 2017, I issued an order by consent.

The operative part said the applicant would harvest the crop of cane on the disputed portion of the land, but, that, thereafter, all operations on it would cease pending the resolution of the dispute by the first respondent within thirty days.

The first respondent obliged.

In its notice of opposition to the present application, the first respondent said it had resolved the dispute in terms of the High Court order and in accordance with its Constitutional mandate.

It said on the appointed day, it had called the parties for a survey of the land boundaries. Using the advanced GPS facility (Global Positioning System), it had established, that, the 21 hectares allocated to the third respondent had been over and above, and quite separate from the 50 hectares allocated to the applicant. Her 50 hectares were intact. Of those, about 48 were arable. The respondent might have been farming the extra 21 hectares over the years but she had no lawful authority or any right over them.

It was this decision by the first respondent that sparked the present application.

The applicant said she was disgruntled by the decision. She claimed her representative had not been given an opportunity to make representations. She claimed the decision was unfair, unprocedural, illegal and irrational. In this regard she merely regurgitated the language of Secretary for Transport & Anor v Makwavarara 1991 (1) ZLR 18 (SC).

The applicant sought the following orders:

(i) That, the resolution made by the first respondent, on the dispute between the applicant and the third respondent, be set aside;

(ii) That, the offer of 21 hectares by the second respondent to the third respondent over the applicant's plot be cancelled;

(iii) That, the applicant should continue to tend to her sugar cane crop on the 21 hectares pending finalisation of the dispute;

(iv) That, the first and second respondents had to invite the applicant and the third respondent to submit representations in respect of the disputed land within thirty days of the court order; and

(v) That, the second respondent should make a determination into the matter giving written reasons within ninety days of the date of the court order.

The application was manifestly ill-conceived. I dismissed it soon after the presentation of oral submissions and gave my reasons ex tempore. That was on 2 February 2019.

The record was returned to the Registry.

Only in August 2019 did the Registry receive a letter from the applicant's lawyers wanting written reasons for my decision and claiming that a previous request had, by mistake, not been delivered. But, regrettably, I could not oblige soon enough. For much of the second term vacation, and the third term, I was indisposed.

That explains the delay in rendering this judgment.

The application was ill-conceived, because, apart from regurgitating the principles of review of an administrative decision, as set out by case law, there was little or nothing of the factual background upon which the application was based.

Both the first and third respondents stated, in their opposing affidavits, that, all the parties were called to witness the Global Positioning System (GPS) survey.

The applicant was completely silent about this crucial fact, both in her founding and answering affidavits.

So, I find that the applicant was present when the Global Positioning System (GPS) survey was conducted. She would have had the opportunity to make whatever representations she might have had.

The first respondent said the results of the GPS survey showed that the applicant's 50 hectares were not interfered with and that the 21 hectares allocated to the third respondent were not carved out of her portion.

The applicant proffered no counter argument, let alone present any facts to rebut the survey findings. She was simply adamant that the 21 hectares allocated to the third respondent had been chopped off her own allocation.

That was ill-conceived.

Part of the applicant's argument was that the first respondent wrongly treated the dispute between herself and the third respondent as a dispute over boundaries, yet it was not, but was a dispute of land invasion by the third respondent over land lawfully allocated and utilised by herself.

But, the dispute was indeed a dispute over boundaries.

The order by consent, in September 2017, expressly recognised the dispute as one over boundaries. The very first line to the preamble to that order read:

“Whereas there is a dispute relating to boundaries and allocation of land on Farm 38, Hippo Valley Estates, Chiredzi as between and among the parties;”

There was no basis for the remedies sought in the draft order. The real dispute had been competently and properly resolved by the first respondent.

That the applicant had farmed on the disputed portion of the land for thirteen years did not preclude the second respondent from properly allocating it to deserving beneficiaries as the applicant had not acquired rights over it.

When the first respondent resolved the dispute, it issued out a written determination. No breach of the Administrative Justice Act was shown to have occurred.

It was for the above reasons that I dismissed the application with costs.

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Administrative Law re: Presumptions of Regularity and Validity of Official Documents or Advice & Doctrine of Estoppel

Appealed SC16-20 : INFRASTRUCTURE DEVELOPMENT BANK OF ZIMBABWE vs ENGEN PETROLEUM ZIMBABWE (RIVATE) LIMITED Ruled By: GUVAVA JA, MAVANGIRA JA and ZIYAMBI AJA

View Appeal HH253-16 : ENGEN PETROLEUM ZIMBABWE [PVT] LTD vs WEDZERA PETROLEUM [PVT] LTD and INFRASTRUCTURE DEVELOPMENT BANK OF ZIMBABWE Ruled By: MAFUSIRE J

HH621-15 : DELTA CORPORATION LTD vs ZIMABWE REVENUE AUTHORITY Ruled By: HLATSHWAYO J

HB119-11 : LEAHOLM ENTERPRISES (PVT) LTD vs ZIMBABWE REVENUE AUTHORITY Ruled By: NDOU 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

SC73-17 : TENDAYI TAMANIKWA and FRANK TINARWO vs ZIMBABWE MANPOWER DEVELOPMENT FUND and EMMERSON PAMIRE Ruled By: GWAUNZA JA, BHUNU JA and UCHENA JA

HB04-09 : ECKEM WILIAM SITHOLE vs PG INDUSTRIES ZIMBABWE (LIMITED) T/A THE AFRICAN LUMBER COMPANY P/L Ruled By: NDOU J

HH173-17 : F. MUTATA and OTHERS vs THE MINISTER OF LOCAL GOVERNMENT, PUBLIC WORKS AND URBAN DEVELOPMENT Ruled By: CHITAKUNYE J and NDEWERE J

HH177-17 : GILBERT JONGA vs NYASHA CHABATA Ruled By: CHATUKUTA J

CC16-19 : PERFECT NYATHI vs THE STATE Ruled By: MALABA CJ, GARWE JCC, MAKARAU JCC, GOWORA JCC, HLATSHWAYO JCC, PATEL JCC, GUVAVA JCC, MAVANGIRA JCC and BERE JCC

View Appeal HH321-17 : NORMAN MAFERERA vs SUSAN JANUARY Ruled By: MATANDA-MOYO J

HH600-14 : DELTA BEVERAGES (PVT) LTD vs FREEDOM CHIMURIWO and CLERK OF THE MAGISTRATES COURT FOR THE PROVINCE OF MASHONALAND IN HARARE N.O. and MESSENGER OF COURT Ruled By: CHIGUMBA J

HH52-09 : NEIL BRUCE vs ECONET WIRELESS (PVT) LTD and CITY OF HARARE Ruled By: OMERJEE J

SC39-00 : E. FILON vs THE PUBLIC SERVICE COMMISSION and THE MINISTER OF LANDS AND WATER RESOURCES Ruled By: GUBBAY CJ, McNALLY JA and EBRAHIM JA

HH02-10 : JOHN RODGER & OTHERS vs FRIK MULLER & OTHERS Ruled By: PATEL J

HH113-09 : DIDYMUS MUTASA vs NGONI NDUNA N.O. and ATTORNEY-GENERAL and COMMISSIONER-GENERAL OF POLICE and ROBERT MCKERSIE Ruled By: PATEL J

SC03-21 : AFRITRADE INTERNATIONAL LIMITED vs ZIMBABWE REVENUE AUTHORITY Ruled By: PATEL JA, BHUNU JA and BERE JA

HH424-13 : HONEY AND BLANCKENBERG vs LOURENCE ERASMUS VERMAAK and OTHERS Ruled By: TSANGA J

Appealed SC09-21 : ANDERSON MANJA and 98 OTHERS vs SHERIFF OF ZIMBABWE and GURTA MINING AG Ruled By: MAVANGIRA JA, UCHENA JA and MATHONSI JA

View Appeal HH351-20 : THE SHERIFF OF ZIMBABWE and GURTA AG vs ANDERSON MANJA and 98 OTHERS Ruled By: CHIKOWERO J

SC19-21 : CHEVHU HOUSING CO-OPERATIVE SOCIETY LIMITED AND OTHERS vs CREST BREEDERS INTERNATIONAL (PVT) LTD AND MINISTER OF LANDS AND RURAL SETTLEMENTS Ruled By: BHUNU JA, MATHONSI JA and KUDYA AJA

HB01-15 : MARIA RABEKA vs LARISSA STOCKIL and ASSISTANT MASTER OF THE HIGH COURT and REGISTRAR OF DEEDS N.O. Ruled By: MAKONESE J

View Appeal SC61-21 : COSMA CHIANGWA vs DAVID KATERERE and ROBERT CAMPBELL LOGAN and ISRAEL GUMUNYU and REGISTRAR OF DEEDS and EDMOND CHIVHINGE and MASTER OF THE HIGH COURT Ruled By: BHUNU JA, MATHONSI JA and CHITAKUNYE AJA

HH11-09 : THE MASTER OF THE HIGH COURT vs SITHANDIZILE DHLAMINI MOYO (as executor dative of Estate Late Willas Moyo) and GERTRUDE MOYO and SITHEMBISO KUSODZA Ruled By: GUVAVA J

SC68-21 : SIBONILE DUBE vs PAUL MUREHWA and MINISTER OF LOCAL GOVERNMENT, PUBLIC WORKS AND NATIONAL HOUSING N.O. Ruled By: GUVAVA JA, MAVANGIRA JA and KUDYA AJA

Appealed SC82-21 : TRIANGLE LIMITED and HIPPO VALLEY ESTATES LIMITED vs ZIMBABWE REVENUE AUTHORITY and OTHERS Ruled By: GWAUNZA DCJ, MATHONSI JA and CHITAKUNYE AJA

View Appeal HMA28-20 : TRIANGLE LIMITED and HIPPO VALLEY ESTATES vs ZIMBABWE REVENUE AUTHORITY and OTHERS Ruled By: ZISENGWE J

HB25-15 : DORCAS MHLANGA vs BENJAMIN PHAKATSHANE Ruled By: MUTEMA J and MOYO J

SC106-21 : CAIRNS FOODS LIMITED vs NETRADE MARKETING (PVT) LTD Ruled By: MATHONSI JA, CHIWESHE JA and CHITAKUNYE JA

Appealed SC110-21 : UPSET INVESTMENTS (PRIVATE) LIMITED vs CHITUNGWIZA MUNICIPALITY Ruled By: GARWE JA, HLATSHWAYO JA and BHUNU JA

View Appeal HH100-17 : UPSET INVESTMENTS (PRIVATE) LIMITED vs CHITUNGWIZA MUNICIPALITY Ruled By: MUREMBA J

HH99-18 : C F (PVT) LTD vs ZIMBABWE REVENUE AUTHORITY Ruled By: KUDYA J

HH99-18 : C F (PVT) LTD vs ZIMBABWE REVENUE AUTHORITY Ruled By: KUDYA J

HB46-15 : ZENZO NTULIKI vs TIMOTHY SEAN WHITE and OFFICER COMMANDING MATEBELELAND SOUTH PROVINCE and THE SHERIFF OF ZIMBABWE N.O. Ruled By: MOYO J

HB48-15 : EBENEZER TRUST vs THE MINISTER OF LANDS AND RURAL RESSETTLEMENT and P. K. MHLANGA N.O. (as Acting District Lands Officer) and RHODIE MASHINGAIDZE and CHIEF MASUKU Ruled By: MOYO J

HB59-15 : NOMUSA NCUBE (as Executrix Dative of Estate Late Alice Nkala) vs GOODWILL NKALA Ruled By: MOYO J

HH823-15 : AT INTERNATIONAL LTD vs ZIMBABWE REVENUE AUTHORITY Ruled By: KUDYA J

HHB62-15 : MICHAEL BIDDLECOMBE vs THE STATE Ruled By: TAKUVA J and MOYO J

HMA21-19 : MR MBOZVI vs CHENGETAI SIDHUNA Ruled By: MAWADZE J and MAFUSIRE J

View Appeal HH264-21 : MUSA KIKA vs MINISTER OF JUSTICE LEGAL & PARLIAMENTARY AFFAIRS and THE CHIEF JUSTICE HONOURABLE LUKE MALABA N.O. and OTHERS Ruled By: ZHOU J, CHAREWA J and MUSHORE J

HMA54-19 : TANDIWE MHLANGA vs ZIMBABWE LAND COMMISSION and MINISTER OF LANDS, AGRICULTURE & RURAL RESETTLEMENT and MUNASHE SHOKO Ruled By: MAFUSIRE J

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Zimbabwe

Appealed
SC16-20 : INFRASTRUCTURE DEVELOPMENT BANK OF ZIMBABWE vs ENGEN PETROLEUM ZIMBABWE (RIVATE) LIMITED
Ruled By: GUVAVA JA, MAVANGIRA JA and ZIYAMBI AJA

View Appeal
HH253-16 : ENGEN PETROLEUM ZIMBABWE [PVT] LTD vs WEDZERA PETROLEUM [PVT] LTD and INFRASTRUCTURE DEVELOPMENT BANK OF ZIMBABWE
Ruled By: MAFUSIRE J

HH621-15 : DELTA CORPORATION LTD vs ZIMABWE REVENUE AUTHORITY
Ruled By: HLATSHWAYO J

HB119-11 : LEAHOLM ENTERPRISES (PVT) LTD vs ZIMBABWE REVENUE AUTHORITY
Ruled By: NDOU 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

SC73-17 : TENDAYI TAMANIKWA and FRANK TINARWO vs ZIMBABWE MANPOWER DEVELOPMENT FUND and EMMERSON PAMIRE
Ruled By: GWAUNZA JA, BHUNU JA and UCHENA JA

HB04-09 : ECKEM WILIAM SITHOLE vs PG INDUSTRIES ZIMBABWE (LIMITED) T/A THE AFRICAN LUMBER COMPANY P/L
Ruled By: NDOU J

HH173-17 : F. MUTATA and OTHERS vs THE MINISTER OF LOCAL GOVERNMENT, PUBLIC WORKS AND URBAN DEVELOPMENT
Ruled By: CHITAKUNYE J and NDEWERE J

HH177-17 : GILBERT JONGA vs NYASHA CHABATA
Ruled By: CHATUKUTA J

CC16-19 : PERFECT NYATHI vs THE STATE
Ruled By: MALABA CJ, GARWE JCC, MAKARAU JCC, GOWORA JCC, HLATSHWAYO JCC, PATEL JCC, GUVAVA JCC, MAVANGIRA JCC and BERE JCC

View Appeal
HH321-17 : NORMAN MAFERERA vs SUSAN JANUARY
Ruled By: MATANDA-MOYO J

HH600-14 : DELTA BEVERAGES (PVT) LTD vs FREEDOM CHIMURIWO and CLERK OF THE MAGISTRATES COURT FOR THE PROVINCE OF MASHONALAND IN HARARE N.O. and MESSENGER OF COURT
Ruled By: CHIGUMBA J

HH52-09 : NEIL BRUCE vs ECONET WIRELESS (PVT) LTD and CITY OF HARARE
Ruled By: OMERJEE J

SC39-00 : E. FILON vs THE PUBLIC SERVICE COMMISSION and THE MINISTER OF LANDS AND WATER RESOURCES
Ruled By: GUBBAY CJ, McNALLY JA and EBRAHIM JA

HH02-10 : JOHN RODGER & OTHERS vs FRIK MULLER & OTHERS
Ruled By: PATEL J

HH113-09 : DIDYMUS MUTASA vs NGONI NDUNA N.O. and ATTORNEY-GENERAL and COMMISSIONER-GENERAL OF POLICE and ROBERT MCKERSIE
Ruled By: PATEL J

SC03-21 : AFRITRADE INTERNATIONAL LIMITED vs ZIMBABWE REVENUE AUTHORITY
Ruled By: PATEL JA, BHUNU JA and BERE JA

HH424-13 : HONEY AND BLANCKENBERG vs LOURENCE ERASMUS VERMAAK and OTHERS
Ruled By: TSANGA J

Appealed
SC09-21 : ANDERSON MANJA and 98 OTHERS vs SHERIFF OF ZIMBABWE and GURTA MINING AG
Ruled By: MAVANGIRA JA, UCHENA JA and MATHONSI JA

View Appeal
HH351-20 : THE SHERIFF OF ZIMBABWE and GURTA AG vs ANDERSON MANJA and 98 OTHERS
Ruled By: CHIKOWERO J

SC19-21 : CHEVHU HOUSING CO-OPERATIVE SOCIETY LIMITED AND OTHERS vs CREST BREEDERS INTERNATIONAL (PVT) LTD AND MINISTER OF LANDS AND RURAL SETTLEMENTS
Ruled By: BHUNU JA, MATHONSI JA and KUDYA AJA

HB01-15 : MARIA RABEKA vs LARISSA STOCKIL and ASSISTANT MASTER OF THE HIGH COURT and REGISTRAR OF DEEDS N.O.
Ruled By: MAKONESE J

View Appeal
SC61-21 : COSMA CHIANGWA vs DAVID KATERERE and ROBERT CAMPBELL LOGAN and ISRAEL GUMUNYU and REGISTRAR OF DEEDS and EDMOND CHIVHINGE and MASTER OF THE HIGH COURT
Ruled By: BHUNU JA, MATHONSI JA and CHITAKUNYE AJA

HH11-09 : THE MASTER OF THE HIGH COURT vs SITHANDIZILE DHLAMINI MOYO (as executor dative of Estate Late Willas Moyo) and GERTRUDE MOYO and SITHEMBISO KUSODZA
Ruled By: GUVAVA J

SC68-21 : SIBONILE DUBE vs PAUL MUREHWA and MINISTER OF LOCAL GOVERNMENT, PUBLIC WORKS AND NATIONAL HOUSING N.O.
Ruled By: GUVAVA JA, MAVANGIRA JA and KUDYA AJA

Appealed
SC82-21 : TRIANGLE LIMITED and HIPPO VALLEY ESTATES LIMITED vs ZIMBABWE REVENUE AUTHORITY and OTHERS
Ruled By: GWAUNZA DCJ, MATHONSI JA and CHITAKUNYE AJA

View Appeal
HMA28-20 : TRIANGLE LIMITED and HIPPO VALLEY ESTATES vs ZIMBABWE REVENUE AUTHORITY and OTHERS
Ruled By: ZISENGWE J

HB25-15 : DORCAS MHLANGA vs BENJAMIN PHAKATSHANE
Ruled By: MUTEMA J and MOYO J

SC106-21 : CAIRNS FOODS LIMITED vs NETRADE MARKETING (PVT) LTD
Ruled By: MATHONSI JA, CHIWESHE JA and CHITAKUNYE JA

Appealed
SC110-21 : UPSET INVESTMENTS (PRIVATE) LIMITED vs CHITUNGWIZA MUNICIPALITY
Ruled By: GARWE JA, HLATSHWAYO JA and BHUNU JA

View Appeal
HH100-17 : UPSET INVESTMENTS (PRIVATE) LIMITED vs CHITUNGWIZA MUNICIPALITY
Ruled By: MUREMBA J

HH99-18 : C F (PVT) LTD vs ZIMBABWE REVENUE AUTHORITY
Ruled By: KUDYA J

HH99-18 : C F (PVT) LTD vs ZIMBABWE REVENUE AUTHORITY
Ruled By: KUDYA J

HB46-15 : ZENZO NTULIKI vs TIMOTHY SEAN WHITE and OFFICER COMMANDING MATEBELELAND SOUTH PROVINCE and THE SHERIFF OF ZIMBABWE N.O.
Ruled By: MOYO J

HB48-15 : EBENEZER TRUST vs THE MINISTER OF LANDS AND RURAL RESSETTLEMENT and P. K. MHLANGA N.O. (as Acting District Lands Officer) and RHODIE MASHINGAIDZE and CHIEF MASUKU
Ruled By: MOYO J

HB59-15 : NOMUSA NCUBE (as Executrix Dative of Estate Late Alice Nkala) vs GOODWILL NKALA
Ruled By: MOYO J

HH823-15 : AT INTERNATIONAL LTD vs ZIMBABWE REVENUE AUTHORITY
Ruled By: KUDYA J

HHB62-15 : MICHAEL BIDDLECOMBE vs THE STATE
Ruled By: TAKUVA J and MOYO J

HMA21-19 : MR MBOZVI vs CHENGETAI SIDHUNA
Ruled By: MAWADZE J and MAFUSIRE J

View Appeal
HH264-21 : MUSA KIKA vs MINISTER OF JUSTICE LEGAL & PARLIAMENTARY AFFAIRS and THE CHIEF JUSTICE HONOURABLE LUKE MALABA N.O. and OTHERS
Ruled By: ZHOU J, CHAREWA J and MUSHORE J

HMA54-19 : TANDIWE MHLANGA vs ZIMBABWE LAND COMMISSION and MINISTER OF LANDS, AGRICULTURE & RURAL RESETTLEMENT and MUNASHE SHOKO
Ruled By: MAFUSIRE J