Paul Chihwati and Elizabeth Vimbai Rwodzi and Patrick Kabote v Zvimba Rural District Council

### Preamble
1
HCC 62/24
HCCR 186/23
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PAUL CHIHWATI

And

ELIZABETH VIMBAI RWODZI

And

PATRICK KABOTE

And

ZVIMBA RURAL DISTRICT COUNCIL

HIGH COURT OF ZIMBABWE
MUZOFA J
CHINHOYI, 31 May & 5 July 2024

Application for a declaratur

F. Murisi, for the applicant

K. Choga, for the 1st respondent

M. Mutsvairo, for the 2nd respondent

No appearance for the 3rd respondent

MUZOFA J: The following is common cause. The 2nd respondent purchased from the 3rd respondent stand number 46 Murombedzi Growth Point, Murombedzi ‘the property’. The 3rd respondent is a Rural District Council. They entered into a lease with an option to buy agreement.

On the 26th of May 2015 the 2nd respondent sold the property to the applicant in the sum of US$3 600.00. It was agreed as between the parties that, US$1 800.00 shall be paid in cash to the 2nd respondent on signature. The balance of US$1 800.00 was payable to the 3rd respondent to clear all outstanding arrears for levies and associated charges in respect of the property. No timeline was given as to such payment.

The applicant duly paid the US$1 800.00 to the 2nd respondent. It is in dispute whether he paid the balance to the 3rd respondent. No cession was effected, the property remained in the name of the 2nd respondent.

The applicant made no improvements on the property. In august 2023 he discovered that someone had started work on the property. This person who turned out to be the 1st respondent had started digging. The applicant approached the 3rd respondent for clarification. To his surprise he learnt that the 2nd respondent had sold the same property to the 1st respondent.

As a result, the applicant approaches this court for a declaratory order that the agreement of sale between him and the 2nd respondent be declared valid and binding, that the agreement of sale between the 1st and 2nd respondents be declared null and void and costs of suit against the 2nd respondent on a higher scale.

The 1st and 2nd respondents opposed the application. The 3rd respondent did not file any opposing papers. The main thrust of the opposition by both the 1st and 2nd respondents is that the applicant repudiated the contract as such the 2nd respondent was entitled to sale. Further to that, the 1st respondent argued that she is an innocent purchaser who must be protected. She was unaware of the sale between the applicant and the 2nd respondent.

Besides raising repudiation, the 2nd respondent raised all the dust that he could to resist the claim including preliminary points. Initially in his opposing affidavit he raised prescription that the cause of action arose on 27 July 2015, the claim prescribed in July 2018. On the date of hearing the point taken was withdrawn on the basis that a declaratur does not prescribe. The decision was not properly thought through in light of later decisions.Since the preliminary point was abandoned there is no need for further engagement with the issue.

A second preliminary point was taken, raised in the heads of argument, that there is no applicant before the court since the signature on the founding affidavit differs from the one on the agreement of sale. It was said this was a point of law and it could be raised at any time. Surprisingly the court was invited to look closely at the signatures and come to the conclusion that the signatures are different. That invitation ably demonstrated that the point taken is not a question of law but a question of fact resolvable on facts, as properly submitted for the applicant. It cannot therefore be raised belatedly in the heads of argument. The applicant cannot ably respond. The 2nd respondent relied on the authority of Francis Haisaid v Musomere & Ors HH 593/18 for the court to examine the signatures. What escaped the 2nd respondent is that, in that case the issue was properly before the court. A court can only exercise its mind on issues that are properly before it. In this case the issue is not properly before the court. The issue raised is a question of fact and it cannot be raised at any point during proceedings. The point taken is dismissed.

On the merits the issue for determination is whether the applicant satisfied the requirements of a declaratur and this court must exercise its discretion in his favour.

In the leading case of Johnson v AFG 1995 (1) ZLR 65 (S) the court opined that the applicant must be an interested person, in the sense of having a direct and substantial interest in the subject matter. There must also be a live dispute which is not academic.

Herbstein and Van Winsen breakdown the factors to be established as follows:

The applicant must have an interest in the subject matter

An existing, future or contingent right or obligation

The decision must be binding on the persons concerned.

Absence of other relief.

It is not in dispute that the applicant has an interest in the property. The agreement of sale between the applicant and the 2nd respondent gave the applicant personal rights in the property.

The real issue is whether the right still exists. Both the 1st and 2nd respondents submitted that the applicant repudiated the contract when he failed to pay the US$1 800.00 to the 3rd respondent. On the authority of Mutizhe v Ganda & Ors SC 17/09 it was argued that the applicant cancelled the contract by his own breach.

Apart from citing a paragraph from the Mutizhe case (supra) and adding that the applicant breached the contract, no oral submissions were made to advance the position. A party who relies on a precedent has a duty to demonstrate how such a case is a relevant authority to his or her case.

In any event in the Mutizhe case the court confirmed the position of the law on repudiation.Cancelation is lawful where there has been repudiation which is accepted by the innocent party. Repudiation therefore is more of a breach giving rise to cancelation. See Data Color International (Pty) Ltd v Intamarket (Pty) Ltd 2001 (2) SA 284 (SCA) 300 D.

The 2nd respondent attached a letter from the 3rd respondent addressed to him advising of arrears on levies and associated payments. The letter was used to demonstrate that by 2021 there were arrears that was evidence of non-payment. As already stated, the payment to 3rd respondent had no performance date which implies that time was not of essence. There was no evidence from the 3rd respondent that the said amount was not paid. It is trite that he who alleges must prove. The difficulty that arises is that the agreement was entered in 2015 and the letter was addressed in 2021 some 6 years later. Obviously the US$1800 was meant to clear arrears up to 2015 from then on it was the applicant’s responsibility to pay. The letter did not specify when the arrears arose so it remained meaningless in so far as the point the 2nd respondent intended to prove. For all intents and purposes the arrears could have arisen post 2015.

I inquired from the 2nd respondent’s counsel to whose prejudice it was had the property been repossessed. The response was that, it was the applicant. This demonstrates that the parties were ad idem that personal rights in the property had passed from the 2nd respondent to the applicant.

For the 2nd respondent to raise a plea of breach is belated, the horse has already bolted. The 2nd respondent did not cancel the contract between the parties as a result of the said breach if there was any. The written agreement of sale provided a remedy to any breach. The 2nd respondent was enjoined to put the applicant in mora by giving 14 days’ written notice to remedy the breach. Failure to remedy would entitle 2nd respondent to cancel. This was not done. The 2nd respondent therefore did not cancel the agreement it remained valid.

I say this cognisant of the fact that the applicant did not produce all the receipts to show that the US$1 800.00 was paid to the 3rd respondent. He attached a few documents and averred that he could not get the rest due to lapse of time. In my view if there was some unpaid balance the prejudice was on the applicant and not the 2nd respondent. As the holder of personal rights in the property, he stood to lose the property as opposed to the 2nd respondent who had already received his payment. The stakes were high against the applicant as opposed to the 2nd respondent in the event of a repossession. Since a declaratory order is a discretionary relief it is my firm view that the applicant is entitled to the order.

I shall address the other ancillary issues raised for the 2nd respondent. Firstly the 2nd respondent sought to escape the consequences of his conduct by referring to his own misdemeanours. That cannot be accepted. It was submitted that the 2nd respondent sold the property in breach of a clause his cession agreement with the 3rd respondent. Secondly that the agreement is invalid since the applicant did not obtain real rights. The second point taken is borne out of a misunderstanding of the law a cession agreement is recognisable at law.

The clause relied upon by the 2nd respondent which was a terms of his agreement with the 3rd respondent provided in part.

“S 8. The lessee (2nd respondent) shall not cede or assign this lease or sublet or part with the possession of the stand, or any part with the possession of the stand, or any part hereof or alienate, mortgage, donate or otherwise dispose of the same or cede or assign any right acquired by him hereunder without the previous (sic) consent in writing of the lessor, or until title to the stand shall have been granted to him as hereinafter mentioned”.

In view of that clause, it was argued that the agreement between the applicant and the 2nd respondent was illegal as there was no consent from the 3rd respondent.

The point has no merit. In a line of cases this court has pronounced itself that the agreement is valid between the lessee- purchaser and the buyer. The only limitation is that the buyer cannot enforce the agreement as against the lessor. In Nkomo v Mujuru 1997 (1) ZLR 155 (HC) the applicant held a lease with the Government over a certain property. Part of the terms of agreement were that the lessee should not cede or assign the lease, or sublet or alienate the stand without the lessors’ written consent. Applicant had sold, and later sought to cancel the agreement based on the clause. The headnote to the case aptly captured the position which is apposite in this case that;

“The applicant’s failure to comply with the condition prohibiting alienation did not amount to non-compliance with a contractual formality so as to render the agreement null and void. It was clear that the assignment was unenforceable and ineffective as against the Government at the instance of either the applicant or the respondent. On the other hand, it was not prohibited by statute, or common law nor was it contrary to public policy or contra bono mores, nor were there statutory required formalities to be complied with. It was therefore legally binding inter parties’ underlining for emphasis.

By parity of reasoning, the agreement of sale is binding between the 2nd respondent and the applicant despite the non-compliance with the 3rd respondents conditions.

The applicant’s personal rights in the property are still in existence. The 2nd respondents is still bound by the agreement.

The 2nd respondent having sold his personal rights in the property. He had no additional rights to sell to the 1st respondents. Even if the matter is treated as a double sale situation the 1st respondent was the second purchaser.

The position of the law in double sales where title has not passed is now settled. The first in time is the stronger. See Guga -v- Moyo & Others 2000(2) ZLR 458(S).In this case there is no title to talk of. Even the cession has not even passed from the 2nd respondent to the 1st respondent. The 1st respondent had not effected any improvements on the property except for some minimal digging. On her part, the 1st respondent did not make a case why her agreement should be recognized ahead of the applicant’s except that she is an innocent purchaser. As already stated in the absence of transfer of title or any considerable developments, the applicant has a stronger claim.

The 1st respondent’s recourse are damages as against the 2nd respondent.

On costs, the applicant seeks costs on a higher scale against the 2nd respondent. I agree. Courts are slow to grant such punitive costs since they tend to discourage litigants from court. However, courts can award costs on a higher scale to mark its displeasure as a result of the litigant’s conduct.

In Rubin L Law of Costs in South Africa the author classified the grounds upon which a court can award costs on a higher scale as follows:

Dishonest conduct either in the transaction giving rise to the proceedings or in the proceedings.

Malicious conduct.

Reckless proceedings.

Vexatious and frivolous proceedings.

The 2nd respondent’s approach to these proceedings is regrettable. He raised so many issues some were even difficult to understand yet he was well aware of the agreement of sale between him and the applicant. At some point he dishonoured the agreement, particularly the affidavit he signed acknowledging receipt of US$1 800.00. He then in an about turn without explanation focused on the alleged unpaid US$1 800.00 due to the 3rd respondent. In all this it  was well within his knowledge that he had not cancelled the agreement with the applicant yet he went on to sale the same property to the 1st respondent. He literally had a second bite of the cherry , from the same property he made two purchases. Such conduct must be discouraged. The court can only mark its displeasure through costs on a higher scale.

Disposition

The 2nd respondent sold the property to the applicant and received the US$1 800.00. The agreement of sale remains valid since it was not validly cancelled by the 2nd respondent. The sale to the 1st respondent was void ab initio. The 2nd respondent no longer had any rights to dispose in the property. The balance of probabilities and interest of justice require that the first in time, the applicant must be granted relief. The applicant satisfied the requirements of a declaratur.

Accordingly, the following order is granted:

The application for a declaratory order be and is hereby granted.

It is hereby declared that the agreement of sale between the applicant and the 2nd respondent entered into in respect of stand number 46 Murombedzi Growth Point, Murombedzi is still valid and binding between the parties.

The agreement of sale entered into between the 1st and 2nd respondents in respect of the said property be and is hereby declared null and void.

The 2nd respondent shall pay costs on the legal practitioner and client scale.

Murisi & Associates, applicant’s legal practitioners

Choga & Associates, 1st respondent’s legal practitioners

Mushonga, Mutsvairo & Associates, 2nd respondent’s legal practitioners