Brian Justice Enterprises (Private) Limited v H.E.R. (Private) Limited and Nitsa Andrea Olympios and Paris Olympios and Christos Venturas and Registrar of Deeds

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BRIAN JUSTICE ENTERPRISES (PRIVATE) LIMITED
versus
H.E.R. (PRIVATE) LIMITED
and
NITSA ANDREA OLYMPIOS
and
PARIS OLYMPIOS
and
CHRISTOS VENTURAS
and
REGISTRAR OF DEEDS


HIGH COURT OF ZIMBABWE
HUNGWE J
HARARE, 31 January and 3 February 2012


Urgent Chamber Application


Advocate L Uriri, for the applicant
Advocate JB Wood, for 1st – 4th respondents


        HUNGWE J: This matter was placed before me through the Chamber Book on 25
January 2012. After I perused the papers I directed that the matter be set down for hearing the
next day. On this day the parties addressed me on the issue of urgency. I found the matter to be
urgent and the respondents asked for more time to prepare and file their opposing papers which
indulgence was granted. The hearing was postponed to 31 January 2012.
        Applicant seeks the following interim relief;
                                       INTERIM RELIEF

Pending the determination by this Honourable court of the issues referred to above, it is ordered
that:

        1. The First to Fourth Respondent be and are hereby interdicted from disposing of the
           immovable property in the name of the First Respondent to any third party, registered
           under Deed of Transfer Number 1598/11, pending confirmation of this order.

                             SERVICE OF PROVISIONAL ORDER
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Copies of this Provisional Order shall be served upon the Respondents by the applicant’s
legal practitioners.



        In its founding affidavit the applicant’s director makes the following averments. The
applicant bought 50% shareholding in the first respondent on or about 9 June 2009 under a sale
of shares agreement for US$600 000, 00 under certain terms and conditions. This sum, it is
contended, has been paid in full. The first respondent is resisting the transfer of shares in favour
of the applicant. As a result the applicant has instituted proceedings in this Court compelling
transfer.

        In the meantime the applicant has learnt that the respondents are seeking to dispose of the
only immovable asset owned by the first respondent being a business premises. The applicant’s
director confirms that people in the oil industry have visited the service station to inspect the
premises. The applicant fears that if this asset is sold, it will suffer irreparable harm as it is the
only asset in the first respondent’s books. The applicant states that it has no other remedy besides
seeking the present relief.

        On the other hand, the third respondent as director of first respondent stated the
following; the agreement of sale was concluded in August 2009. The full purchase price was to
be paid by 1 November 2009. The applicant failed to pay the full purchase price by that date. As
a result, the agreement of sale was duly cancelled and a refund of the payment made towards the
purchase price tendered to the applicant’s legal practitioners. The applicant has not made any
effort to supply its bank account details to the respondents to facilitate transfer of the said
payments. Because the sale was cancelled, the first and second and third respondent believes the
applicant has no right to be at the premises.        The third respondent states that the second
respondent who is his mother is entitled to sell her shares in the first respondent but does not
wish to do so at this point in time.

        The third respondent avers that the premises are owned by three shareholders. He states
that he is entitled to sell his shares since they are not subject to any legal dispute and in any event
even if the applicant were to succeed in the matters before the courts, all applicant will be
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entitled to is only 50% share of the premises and not the entire property. He confirms that he is
seeking to sell his 40% share but goes on to assure the court that since the second respondent
does not wish to sell her shares till the matter pending before this court is resolved, there is no
prejudice to the applicant’s interests should he succeed in selling his assets. According to the
third respondent the applicant seeks to interdict the sale of immovable property, wherein it has
no prima facie right, and therefore not entitled to the title deeds.

       Mr Uriri, for the applicant, pointed out that there is a matter pending before this court in
HC1589/12. The issue for decision in that matter is whether the sale of shares agreement entered
into by the parties is liable to be cancelled or whether the applicant is entitled to take transfer of
the shares in the first respondent. The first respondent is the registered owner of the immovable
property, a petrol station, subject of this application. The third respondent holds the other 40%
and there have been attempts to sell this shareholding. The fourth respondent confirms this in his
affidavit. Should the applicant succeed in HC4208/12 then it would be entitled to the 50%
shareholding in the first respondent, which translate to a right to claim 50% share of the
immovable asset subject of these proceedings. By article 5(b) of the first respondent’s Articles of
Association, the applicant will be entitled to a right of pre-emption of the remaining 50%
shareholding in the first respondent which the third respondent has attempted to sell. Such sale in
the present situation would result in irreparable harm to the applicant. On the facts admitted by
the respondent, Mr Uriri agreed, applicant is entitled to the relief it seeks.

       Mrs Wood for the respondents argued that on these facts, the applicant is not entitled to
the remedy of an interim interdict since, to start with, the sale which would have entitled the
applicant some prima facie right to the immovable property was cancelled. In short according to
this argument, the applicant has failed on its first hurdle. Second, there has to be an actual or
reasonably apprehended injury. As the applicant’s rights were extinguished by the cancellation
of the sale, the applicant could not possibly reasonably entertain such fear of injury to non-
existent rights. In any event even if the court held that the applicant has some right capable of
injury, since any sale of property under administration by the executor is a nullity, the applicant
could easily seek the setting aside of the sale with ease. As such, there are other remedies should
the applicant’s rights suffer any harm at the hands of the respondents. Mrs Wood argued that the
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application before this court related to immovable property whereas the conduct giving rise to
the urgency was the third respondent’s dealings with his shares in the first applicant. If I
understood her correctly, which I am sure I did, her argument is that the present application seeks
to interdict the sale of the immovable property. As there is no application being made against the
third respondent’s dealing with his shareholding in the first respondent, then the application, in
its present form, cannot succeed. I need not show to counsel the effect of the order sought but it
seems necessary to do so. The claim by the applicant is that the third respondent seeks to sell his
shares in the first respondent. This entails a share transfer. Such sale of shares is in effect sale of
the immovable property in question because share transfer arises where the property is owned by
a company as its sole asset. Instead of transferring the property from the company to the
purchaser, the company retains ownership of the property and the shares in the company are sold
to the purchasers. It seems to me seeking to interdict the sale of immovable property by the
respondents will achieve the same result which an interdict against share transfer would achieve.

       I agree with Mr Uriri that the applicant has established a prima facie right to some share
in the immovable property owned by the first respondent. The validity of this safe is subject of
the litigation in HC4208/12.

       Having     decided that the applicant has established a prima facie right, does he have a
well-grounded apprehension of irreparable injury? The third respondent says that the second
respondent, his mother, has no intention of selling her shares till the final determination of the
matter which is pending in this court. However, he alleges that he has every right to sell his
shares in the first respondent as they are not subject to any legal dispute. The fact that one of the
respondents such as he commands control in the first respondent company should give the
applicant grounds for some apprehension that the third respondent intends to sell the whole
immovable property for his own advantage. I say this because the second respondent is now
beyond the court’s jurisdiction. The executor who holds a power of attorney for the mother
confirms these attempts at sale. Clearly nothing will prevent the third respondent putting himself
in a position where he could dispose of it without the concurrence or knowledge of the executor.
It is clear, moreover, that an interdict is the only remedy that can protect the applicant from the
harm that he apprehends may be inflicted.
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          In Eriksen Motors (Welkom) Ltd v Protea Motors & Anor 1973 (3) SA 685 (A) at 691
HOLMES JA said that the granting of an interim interdict pending an action is an extraordinary
remedy within the discretion of the court. After referring to the requisites laid down by INNES
JA in Setlogelo v Setlogelo 1913 AD 221 at 227 he said:

          "In exercising its discretion the court weighs, inter alia, the prejudice to the applicant, if
          the interdict is withheld, against the prejudice to the respondent if it is granted. This is
          sometimes called the balance of convenience."


          The second respondent, it has been indicated, is prepared to await the final determination
of the matter pending between her and the applicant before selling her shares. Therefore if an
interim interdict is granted in the terms prayed for, she would hardly suffer any prejudice. On the
other hand, as I have demonstrated above, should this court not grant the interim interdict, there
is a very real danger that the applicant’s rights in the first respondent will most likely be
jeopardised irreparably. On the balance of convenience therefore I consider that the court should
exercise its discretion in favour of the applicant and grant an interim interdict in the terms prayed
for.

          It is ordered:-

1. The First to fourth Respondent be and are hereby interdicted from disposing of the
       immovable property in the name of the First Respondent to any third party, registered under
       Deed of Transfer Number 1598/11, pending confirmation of this order.

2. There is no order as to costs.




Atherstone & Cook , applicant’s legal practitioners
Venturas & Samukange, 1st – 4th respondents’ legal practitioners