Johnson Ngorima and Sinikiwe Ngorima v Admire Chemhere

### Preamble
1
HH 93-21
HC 2268-20
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JOHNSON NGORIMA

and

SINIKIWE NGORIMA

versus

ADMIRE CHEMHERE

HIGH COURT OF ZIMBABWE

MANGOTA J

HARARE, 10 November  2020 & 9 March 2021

Opposed Application

T W Nyamakura, for the applicant

Z T Zvobgo, for the respondent

MANGOTA J: I heard this matter on 10 November 2020. I dismissed it with costs. The dismissal was in terms of an ex tempore judgment which I made.

On 7 December, 2020 counsel for the applicant wrote to the registrar of this court. He requested reasons for my decision. These are they:

The applicants are husband and wife respectively. They purchased from the respondent a certain piece of land which is situated in the District of Salisbury called Stand 2923 Hatfield Township of Lot 1 of subdivision B of Plots 12, 13 and 14 of Salisbury B of Makabusi (“the property”). It is 2000 square metres in extent and is held under Deed of Transfer Number 7954/91.

The applicant’s purchase of the property was in terms of an agreement of sale which they signed with the respondent on 23 June, 2017. The manner in which they were to pay the purchase price for the property is described in clause 4 of the agreement of sale. The clause reads:

“4.	PAYMENT OF THE PURCHASE PRICE

The payment of the purchase price in the sum of US$40 000 (Forty Thousand United States 		Dollars) shall be paid by the purchaser (s) by way of cash or bank transfer free of bank 			charges/commission against registration of transfer into the name of the purchaser which 			shall be secured by a banker’s guarantee or financial undertaking acceptable to the seller’s 		conveyancing (sic) in favour of the seller or the seller’s nominees “(emphasis added)

The applicants had a choice to pay the purchase price of US$40 000 by way of cash or by way of bank transfer which was free of bank charges/commission. They chose the latter method of paying the purchase price for the property. They secured a bank guarantee of the stated sum from Central Africa Building Society (“the Society”). They did so on 30 October, 2017 and 1 November 2017. They delivered the same to the respondent’s conveyancers, namely Mupindu and Partners legal practitioners, on 2 November 2017. Mupindu and Partners received the bank guarantee on 6 November 2017 and did nothing about it. The life span of the bank guarantee was three months after which the Society would withdraw it. The Society withdrew the guarantee after three months. These were reckoned from the date of issue of the guarantee.

On 11 May, 2018 the applicants secured a second bank guarantee from the same bank but for a lesser sum of US$23 748.39. Its life span was, once again, three months. Their attorneys, Mawere Sibanda solicitors, delivered this second bank guarantee to the respondent’s attorneys. These received the second bank guarantee on 1 February, 2018 and, like they did with the first bank guarantee, they did not act on the second bank guarantee which the Society withdrew after the expiry of three months as it stated in the same.

The applicants applied for specific performance. They moved me to compel the respondent to transfer title in the property to them.

The respondent opposed the application. He pleaded the defence of force majeure which he said arose from the introduction of the changes in the currency of Zimbabwe and his inability to perform due to the additional condition which the City of Harare imposed upon him on 2 May, 2018. The condition, he said, required him to construct a road fronting Stands 2923 to 2925 Hatfield Township before it issued him with a certificate of compliance which was/is a sine qua non aspect for transfer of the property to the applicants. He indicated that the construction of the road would visit him with economic hardship of unimaginable proportions. He moved me to dismiss the application with costs.

The defences of the respondent would not have held if the applicants’ house was in order. He could not be heard to quarrel with clear and unambiguous provisions of the Finance (No. 2) Act of 2019 or with Statutory Instrument No. 33 of 2019 as read with Zambezi Gas Zimbabwe (Pvt) Ltd v N R Barber (Pvt) Ltd and Another, SC 3 /20. The case of Unibank Savings and Loans Ltd v ABGA Bank Ltd 2000 (4) SL 191 (W) 149 to which the applicants drew my attention in this application would neatly have come to their aid despite the fact that it is not from this jurisdiction. Its persuasive value would have been difficult, if not impossible, for me to ignore. I totally associate myself with the remarks which Flemming DJP made when he stated in the Unibank case that:

“Impossibility is not implicit in a change of financial strength or in commercial 	circumstances which cause compliance with contractual obligations to be difficult, 	expensive or unaffordable. Deterioration of that nature can be foreseen in the business 	world at the time when the contract is concluded.”

The dictum of Flemming DJP sums up the inapplicability of the respondent’s two defences. A fortiori when he, as in casu, delayed to implement the terms of the contract which he signed with the applicants on 23 June, 2017 and his delay in the mentioned regard remains without any explanation or justification.

The issue of changed circumstances which the respondent placed reliance upon would not have detained my mind at all. The court dismissed the stated issue in a clear language when it ruled in Ncube v Mpofu & Ors , 2006 (2) ZLR 41 (H) that changed circumstances which make performance uneconomical do not mean that the contract has become impossible to be performed. The defence of vis majeure which the respondent raised would, therefore, not have assisted him at all if the applicants’ house was in order. It is unfortunate for them that it is not. My views in the stated regard find support from the undermentioned matters:

A contract is, by definition, an agreement which is intended to be enforceable at law. It is separate and different from a social agreement. It gives rise to rights and obligations as between the parties to it.

In a contract of sale, such as is the one which is under consideration, for instance, the seller’s right is to receive the purchase price and his duty is to deliver to the purchaser the thing which he has sold to him. The purchaser’s right is to receive or take delivery of what he purchased and his duty is to pay the purchase price to the seller. Such rights and obligations are part and parcel of that contract.

It follows, from the foregoing, that an applicant who moves the court to compel the respondent to transfer to him the thing which he purchased (“the merx”) must himself have paid the purchase price (“pretium”) or, at the very least, expressed the intention to pay the purchase price. Where he has paid the purchase price, his right to specific performance remains unassailable. The same position obtains where he tenders to perform. What he cannot do, however, is to move that the respondent should perform when he has not performed, or tendered to perform, his own part of the contract. His motion will not hold under the stated set of circumstances.

My above-mentioned view finds support from what the learned authors Visser. Pretorius Sharrock Van Jaarsveld state in their South African Mercantile & Company Law, 8 ed, p 98 wherein they write that:

“The vast majority of contracts are terminated by the performance of reciprocal obligations of the parties. In the case of a sale, for example, the contract is terminated once the seller has performed by making delivery and the buyer by paying the purchase price.” (emphasis added)

The duties of the parties, it is evident, are reciprocal. They are not akin to a one-way

traffic lane. They must be performed by both parties as is stipulated in the contract.

The stated matter is in sync with the issue which the applicants are moving me to consider. They are not moving me to decide on the validity or otherwise of the contract which they concluded with the respondent. The contract is well in place. What they call upon me to decide is the issue of performance. This is the raison deetre of their application. It is one for specific performance by, or as between, the respondent and them.

The applicants, it has already been observed, opted to pay the purchase price of the property by way of the bank guarantee instead of paying the same by way of cash. The first bank guarantee which their bank, Central Africa Building Society, issued is dated 30 October 2017. Its life-span of three months expired on 30 January 2018 when the bank withdrew its offer of the sum of US$40 000 which constituted the purchase price for the property.

Central Africa Building Society issued, at the applicants’ instance, a second bank guarantee on 11 May 2018. The shortcomings of this second guarantee is that it was for a sum of money which was close to one half of the purchase price of US$40 000 which the parties stipulated in the contract. The life span of this second bank guarantee expired on 11 August 2018 having been issued on 11 May 2018.

The respondent’s conveyancers received the two bank guarantees on 6 November 2017 and 1 February 2018 respectively. They do not appear to have acted on either bank guarantee. Their reasons for not acting on the bank guarantees remain largely unknown.

However, clause 4  of the parties contract offers to the conveyancers a choice to accept or not to accept the bank guarantees. It does not compel them to give reasons where they choose not to accept the bank guarantee(s). The conveyancers, therefore, gave no reason for not having accepted  the applicants’  first, or second, bank guarantee.

The fact that they did not communicate with the respondent the bank guarantee which the applicants’ legal practitioners forwarded to them is clear evidence that they exercised their right not to accept the first bank guarantee which, to all intents and purposes, appeared to be compliant with the terms of the contract. The second bank guarantee served no purpose at all. The respondent would not have accepted what was less than what he bargained for. The conveyancers were correct to reject it, in my view.

The long and short of the above-observed matter is that the applicants have not paid the purchase price for the property. They attempted to do so when they moved Central Africa Building Society to issue the first bank guarantee.

However, because the US$40 000 which was contained in the guarantee did not find its way to the respondent, the net effect is that the applicants have the obligation to pay the purchase price for the property. They cannot compel transfer when they have not paid the purchase price. Their reciprocal obligation to the respondent remains unfulfilled.  They must fulfil it before they demand transfer of title of the property to them.

The applicants have no one but themselves to blame for the unpalatable situation in which they find themselves. Nothing prevented them from insisting on specific performance as soon as the first bank guarantee was issued by Central Africa Building Society and given to the respondent’s conveyancers as purchase price for the property. If they sued at the stated time or within the life-span of the first bank guarantee, the probabilities are that their day in court would have been a well-rewarded one.

The applicants did not pay the purchase price for the property. They do not state, in their pleadings, that they have tendered or are tendering the purchase price for the property. Specific performance, as the respondent correctly states, is available only to a party that is able to perform or is tendering performance of its obligations.

I fully endorse the remarks which the court made when it stated, on the subject matter in issue in Internaional Trading (Pvt) Ltd v Nestle Zimbabwe (Pvt) Ltd, 1993 (1) ZLR 21 (H) at 25, that:

“Prima facie every party to a binding agreement who is ready to carry out his own obligation under it has a right to demand from the other party, so for as it is possible, a performance of his undertaking in terms of the contract, the right of a plaintiff to the specific performance of a contract where the defendant is in a position to do so is beyond all doubt.”

The applicants should have proved that they paid the purchase price. What they proved was that they attempted to pay, through the first bank guarantee, the purchase price. An attempt to pay, it is trite, is not synonymous with payment itself. It is just what it is – an attempt – which does not give rise to actual performance by the applicants. They could also have stated, in their papers, that they were prepared and were, therefore, ready to pay.

Alternatively, they could have secured a third bank guarantee in the sum of RTGS$40 000 which they should have forwarded to the respondents conveyancers and moved for specific performance within the life-span of the guarantee. They did neither. All they did was to move me to compel transfer of the property to them without them having paid the purchase price for the property or tendering to pay the same.

The applicants failed to prove their case on a balance of probabilities. The application is, in the result, dismissed with costs.

Mawere Sibanda Commercial Lawyers, applicants’ legal practitioners

Dube Manikai and Hwacha, respondent’s legal practitioners