Peter Dzvairo v Infrastructure Development Bank of Zimbabwe

### Preamble
1
HH 335-2012
HC 1701/10
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PETER DZVAIRO

versus

INFRASTRUCTURE DEVELOPMENT

BANK OF ZIMBABWE

HIGH COURT OF ZIMBABWE

MUTEMA J

HARARE, 17, 18, 19 AND 20 May 2011and 19,

20, 21 and 22 July 2011, and 20, 21, and 22

September 2011, and 31 October 2011and 1, 2,

3, 4 November 2011 and 5, 6 March 2012

Civil Action

F F Hwenhira, with him T Mudambanuki,

for the plaintiff

U Sakhe, for the defendant

MUTEMA J:	The plaintiff’s prayer in the declaration reads:

“Wherefore the plaintiff claims against the defendant for an order in the following terms:

The defendant return forthwith into the plaintiff’s custody and possession two motor vehicles viz a Mercedez (sic) Benz registration number AAB 6070 and a Nissan Hardbody King Cab registration number ABG 7946 in the same condition the vehicles were in when the defendant dispossessed the plaintiff or IN THE ALTERNATIVE, should both vehicles or one of them be missing for whatever reason the defendant to pay the current market value of both vehicles or such missing vehicle.

The defendant to pay costs of suit.”

The plaintiff is the managing director of a company called Ideal Brands (Pvt) Ltd. Between February – April, 2009, he approached the defendant with a request for Bill Discounting Facilities. He represented to the defendant’s officials that he was an accredited supplier of big companies such a M E Charhons (Pvt) Ltd and CAPS Holdings Ltd from whom he had orders to supply various types of goods required in their operations. As a result of the plaintiff’s representations, the defendant offered him Bill Discounting Facilities during the said period. The plaintiff successfully presented a number of Bills of Exchange drawn by his customers and verified by the defendant with the defendant disbursing cash to the plaintiff being the net proceeds of the discounted face value of the Bills.

Having gained the defendant’s confidence, and on the same terms and conditions, the plaintiff brought more Bills of Exchange allegedly drawn by M E Charhons (Pvt) Ltd (“Charhons”) as follows:

In respect of the above Bills of Exchange the plaintiff received cash for the discounted Bills totalling US$80 067-94. The plaintiff allegedly personally represented to the defendant that these Bills of Exchange were properly drawn or signed on behalf of Charhons. On the maturity dates of the Bills the defendant insisted on receiving payment from Charhons – the drawer of the Bills – but no payment came, with Charhons insisting that the signatures on some of the Bills were forged and that the conditions necessary for them to pay had not been fulfilled by the plaintiff. As a result the defendant lost US$80 067-94 in cash together with any margin of gain it would have received had the Bills been genuine and Charhons had paid for them.

Charhons reported the plaintiff to the police and the plaintiff was arrested. In May, 2009 the plaintiff signed an agreement with the defendant undertaking to repay the full amount of the debt to the defendant. The plaintiff also ceded the two motor vehicles in question as security for payment of the debt.

According to the defendant, both the signing of the agreement and cession of the motor vehicles were free and voluntary. However, on his part, the plaintiff contends that he is innocent of the alleged fraud for he supplied Charhons with the products requested and Charhons authorised signatories signed the contentious Bills so he owes the defendant nothing. Following his arrest the court did not try him for lack of evidence and the alleged signing of acknowledgement of debt and cession of his motor vehicles to the defendant were done under duress hence his claim for their return or payment of their market value.

On its part, defendant counter-claimed for payment of damages allegedly suffered as a result of plaintiff’s misrepresentation regarding the Bills in question in the sum of US$108 284-59 as shown in the table above. The defendant also maintains that the acknowledgment of debt and cession of the motor vehicles by the plaintiff to the defendant were not made under duress.

In terms of the joint pre-trial conference minute, four issues were referred to trial, viz:

Whether or not the plaintiff is liable to pay the defendant any sum of money.

Whether or not the plaintiff’s letter dated 6 May 2009 and the written agreement between the plaintiff and the defendant dated 7 May 2009 are valid and binding, and if so, whether or not the plaintiff freely surrendered his two motor vehicles, a Mercedes Benz registration number AAB 6070 and a Nissan Hardbody King Cab registration number ABG 7946 to the defendant.

Whether or not the defendant had any right to take the plaintiff’s above mentioned motor vehicles at all.

Whether or not the defendant should be ordered to return the plaintiff’s motor vehicles forthwith.

I must point out at this juncture that this was an inelegant way of crafting the issues because drafted as they are they amount to a redundancy. Disposal of issues 1 and 2 above sufficiently incorporates disposal of the balance of the issues but not vice versa. I will therefore deal with the first two issues seriatim.

Whether or not the plaintiff is liable to pay the defendant any sum of money?

The onus of proving this issue lay squarely on the defendant and it was discharged. It is clear from the terms and conditions of the Bill discounting facility that the agreement was concluded by the defendant as lender and the plaintiff as borrower and the plaintiff did not dispute this. In the event, where the defendant paid the plaintiff for a product the plaintiff would not have delivered to Charhons, the defendant would naturally and legally look up to the plaintiff for the recovery of its money.

If the signatures on the disputed Bills are found to have been forged, the only reasonable inference to draw is that they were forged by the plaintiff or by some Charhons employees with the plaintiff’s connivance because without the plaintiff’s involvement, employees of Charhons would not have any motive for so doing as they would gain nothing out of it. In fact, under cross examination, the plaintiff conceded that he knows of no one else with the opportunity/motive to forge the Bills.

Charhons’ argument regarding the disputed Bills is that no goods were delivered by the plaintiff. The plaintiff averred under cross-examination that he has the delivery notes in his file but baffling is the reason why he did not bother to produce them in evidence let alone proffer an explanation therefor.

The plaintiff faired dismally as a witness. He was argumentative and evasive under cross-examination. He would deny obvious things, only to concede them after being cornered. For instance, he could not remember exactly when he was first arrested in connection with the alleged fraud, which is inconceivable. A serious plaintiff would have recorded this or checked police records. It took a number of questions for him to state where exactly he was arrested, he would not reveal why he did not keep copies of the orders made to him by Charhons, being content to simply say the system used by Charhons was the reason why. Regarding Bill 4558 (p 27 of exh 4 – the defendant’s bundle of documents) the plaintiff initially denied that his purchase of the Nissan King Cab from one Paul Kadange had anything to do with the defendant’s money paid to him. However, after being shown his instruction note (p 79 of the defendant’s bundle of documents) to the defendant to transfer $10 500-00 to Paul Kadange on 30 March, 2009, he lamely attempted to explain that he subsequently cancelled that instruction after the defendant experienced problems with the transfer but p 30 of exh 4 shows that the US$10 500-00 was paid to Kadange on 3 April, 2009 via transfer with the plaintiff getting the balance of the amount in cash in the sum of US6 111-15.

Also, initially under cross examination the plaintiff denied ever receiving disbursements pertaining to the contested Bills but later conceded receiving the money in respect of those Bills. He also said he only got to know that Charhons was not honouring the contested Bills on the very day he was arrested when the defendant told him but later changed saying it was two days prior to his arrest. He could not reconcile his averment that he was arrested between 9 and 24 April, 2009 vis-a-vis the fact that on 23 April, 2009 he had gone to the defendant and cashed Bills 4192 and 4193. The defendant would not have paid him for those Bills knowing about the alleged fraud.

In para 10 of his replication, the plaintiff averred that his motor vehicles were taken on 21 April, 2009 yet p 44 of exh 4 is his instruction to the defendant on 22 April, 2009 to discount Bills 4192 and 4193 and disburse as cash payment – a day after the vehicles were allegedly taken. He could not reconcile the contradiction. In fact by that date the plaintiff had not yet been arrested – evidence shows that he was arrested on 30 April 2009.

Farai Katsande, the defendant’s collections officer at the relevant time gave his evidence in an articulate and convincing manner via inter alia exh 6 – the cash payment register. He was not shaken despite being subjected to a gruelling cross examination which spanned over four days. He explained how the amounts due to the defendant and those disbursed to the plaintiff were calculated by referring to each specific disputed Bill. He highlighted all the portions of exh 6 where the plaintiff signed in acknowledgment of receipt of the funds in issue. Pages 34, 39, 44 and 79 of exh 4 are some of the letters signed by the plaintiff instructing the defendant to discount some of the contested Bills and pay him cash. These relate to Bills 4557, 4185, 4192 and 4193, 4558 respectively.

Mr Hwenhira for the plaintiff sought to impugn Katsande’s testimony on the ground that he was not personally involved in the generation and signing of the Bill Discounting Facility Letters or the Bills of Exchange or the Cash Disbursement Registers (exh 6) which he was producing and relying on. I find this challenge an idle attempt in view of the provisions of s 14 of the Civil Evidence Act, [Cap 8:01] which allows evidence to be admissible in proof of any fact contained in a document kept in the ordinary course of business and is produced by any person in custody of the document. In his closing submissions the plaintiff attempted to discredit Katsande’s evidence by alleging the existence of major discrepancies in exh 6 without spelling out those major discrepancies. I did not find any so called major discrepancies.

Whilst still dealing with the plaintiff’s closing submissions I am constrained to utter the following strictures concerning three aspects, viz the atrocious grammar which could make the queen of England bow her head, look aside and weep, the intemperate language employed in endeavouring to discredit Katsande’s testimony e.g. “Even a mad person cannot agree with Katsande’s explanations.”. “As a star witness for the defendant, Katsande proved to be a mercenary witness whose evidence cannot be relied upon and that Tawanda Zenda, the plaintiff’s third witness’ “testimony was impressive such that the learned judge saw no need for him to be cross-examined.” I do not know whence counsel got it from that Zenda was not cross examined when the record of proceedings clearly reveals that he was indeed cross examined.

Katsande also explained how he sought payment from Charhons who initially confirmed the Bills telephonically but later, after having had physical sight of the Bills, disputed liability on the basis that the signatures were forged. He explained how the plaintiff as borrower, was liable to the defendant in the event that the Bills were not paid by the alleged signatories via reference to clauses in each of the Bill Discounting Facility Letters – pp 1 – 7, 8 – 14, 20 – 26, 53 – 57 of exh 4 and exh(s) 8 and 9.

The originals of exh 6 and those of the relevant Bills were produced in court. I find it dishonest of the plaintiff’s counsel to allege without any substance, in the closing submissions that the original books for exh 6 were tampered with.

Having considered the evidence adduced in respect of this issue I find that the defendant, on a balance of probabilities, has managed to discharge the onus resting upon it by proving that:

The plaintiff as borrower and the defendant as lender entered into various Bill Discounting Facilities;

Pursuant to these facilities the plaintiff was given blank and unsigned Bills to take to his customers for signing in terms of the arrangements between him and his customers and he became indebted to the defendant for the sums of money not paid by any signatories to the Bills that he presented to the defendant and paid for;

At all material times, the plaintiff personally collected the unsigned Bills and would personally return them and present the signed Bills to the defendant and received cash;

At times the plaintiff wrote payment instructions to the defendant in long hand and the defendant would pay accordingly;

The plaintiff received all the net proceeds of the Bills as calculated by the defendant and signed the cash payment registers (exh 6);

The only discrepancies on exh 6 relate to the dates of payment which appear in exh 6 and those that appear in the summary of the transaction in the pleadings and the correct dates are those in exh 6; and

The plaintiff forged signatures on Bills 4164, 4185, 4192, 4193, 4195 and 4557 or knew that they were forged or fraudulently drawn. Regarding Bill 4558, the plaintiff knew that he had not delivered the goods in respect thereof.

The fraud was proven via a number of witnesses. Louricka Buckely, a questioned document examiner, was called in terms of s 18 of the Civil Evidence Act. Her evidence was essentially that she carried out a scientific analysis and comparison of the genuine signatures of the authorised signatories of Charhons with those on the disputed Bills presented by the plaintiff to the defendant. Her expert opinion which is on p 82 of exh 4 is that the signatures of Sithole, Mukweza and Mukwekwe as they appear on Bills 4164, 4185, 4192, 4193, 4195 and 4557 had been forged, and that save for Bill 4164, the Bills were forged by one and the same person. I was satisfied that her expert opinion was well founded as the discrepancies in characters of the two sets of signatures were clearly different even to a layperson’s eye. Her evidence was corroborated by that of Sithole and Mukweza who disputed that the signatures on the contested Bills stated above were theirs and pointed out the differences between their signatures and the forged ones. They also stated that the Charhons stamp used on the Bills had been forged due to the differences in font, spelling and colour. Sithole confirmed that regarding Bill 4558, though genuine, no goods relating to it were delivered to Charhons. Indeed no evidence of delivery by the plaintiff was adduced in this matter.

The acknowledgments of debt signed by the plaintiff on 6 and 7 May, 2009 are also apposite, though I shall deal with these in the last issue.

In view of the foregoing, as a result of the plaintiff’s misrepresentation, the defendant suffered damages in the sum of $108 284-59 calculated in the manner set out in the table supra. This finding disposes of the last two issues appearing in the joint pre-trial conference minute, viz whether or not the defendant had any right to take the plaintiff’s motor vehicles at all and whether or not the defendant should be ordered to return the vehicles. The legal position is that once the plaintiff is found to be liable to the defendant – whether in terms of the Bill Discounting Facility or fraudulent misrepresentation – the defendant enjoys a debtor-creditor lien or right of possession as security – see the case of Whyland Construction (Pty) Ltd v Ashley Smith 1985 (3) SA 798 (A) in which the court confirmed the right of lien over a debtor’s property. In any event in casu ownership of the vehicles was never proven let alone the alleged current market value of those vehicles.

Whether or not the plaintiff’s letter dated 6 May 2009 and the written agreement between the plaintiff and defendant dated 7 May 2009 are valid and binding, and if so, whether or not the plaintiff freely surrendered the two motor vehicles, a Mercedes Benz registration number AAB 6070 and a Nissan Hardbody King Cab registration number ABG 7946 to the defendant

In a manner of reasoning, this issue in fact, can be said to have already been disposed of by the resolution of the first issue dealt with above. In any event, the onus of proof on this issue lay with the plaintiff who dismally failed to discharge it.

It was apparent that the plaintiff was clearly creating an elaborate fiction of being an innocent victim of the defendant bank which invented a trail of documents simply to get him. But with what motive? Not even the plaintiff knows. He was evasive and hiding behind the finger of memory lapses even in respect of such material aspects which admit of no forgetfulness. I found him to be with a flair for acting. He would gesticulate and make faces while the defendant’s star witness Farai Katsande was testifying. This conduct amounted to playing to both the gallery and the court. He only desisted from it following my reprimand through his counsel. In spite of the plaintiff’s somewhat irrational behaviour, sometimes credibility cannot be measured by demeanour but by comparing the testimony with the real evidence as was stated by McNALLY JA in Matambo v Mutsago 1996 (1) ZLR 101 (SC) at p 103 in these words:

“However charmingly, smoothly or impressively Mr Mutsago made these statements, the fact is that they are mechanically impossible. If a witness says he saw water flowing uphill unaided by a pump, you do not judge his veracity by reference to his demeanour. You apply the law of physics.”

In casu the plaintiff’s version is simply inconsistent with the established facts, the documentary evidence and the sequence of events.

His evidence was that he was reported to the police by the defendant. This was refuted by the evidence of Sithole, Tichiwangana, Mupfumira, Santu and the investigating officer detective Gava. The plaintiff also alleged that he was detained at Southerton Police Station for fourteen days, a feat which he himself could not prove neither could his wife Linda Dzvairo. The plaintiff was hazy why he did not tell his legal practitioner  Chatambudza who visited him in police cells about his “over detention.”  At first the plaintiff said he did not get the chance to do so because he was in cells and his legal practitioner spoke to investigating officer Gava but later he changed saying he did speak to Chatambudza who asked him about the long detention and he told him that he was waiting for the defendant’s officials to come to the station. It is not comprehensible that a legal practitioner would interview a client who has been in police detention for fourteen days and does not do anything about the apparent unlawful detention.

What is clear from exh 10, the detention record book, is that the plaintiff was arrested and booked for detention on 30 April 2009 at around 18.00 hours and was released on summons on 4 May 2009. Exists some mis-entry regarding the date of release as 2 May, 2009 at 15.00 hours with date of 4 May 2009 reflecting as date of collection by the plaintiff of his belt and pair of shoes. This was clarified by detective Gava who said date of release was actually 4 May 2009. There was no over detention exceeding forty-eight hours since 30 April 2009 and1 May 2009 were public holidays. What is pertinent here is that when the plaintiff signed the contentious documents dated 6 and 7 May 2009 giving away the vehicles as security, he had already been released from custody, contrary to his assertion and Linda’s that he was still in custody and signed the documents for his freedom , hence the alleged duress.

In para 1(b) of his summary of evidence the plaintiff said:

“Further, the documents were signed in retrospect on 6 and 7 May 2009, yet the said motor vehicles had been taken by some police officers from Southerton Police Station from the plaintiff’s house on the defendant’s specific instructions and taken to the defendant’s premises on or around 21 April 2009 while the plaintiff was in police cells. The so called agreement and other documents were signed under extreme duress and there are witnesses to the whole transaction. There is no way that the plaintiff could have driven the cars himself to the premises of the defendant as alleged while he was in police custody.”

The correct position, however, is that on 21 April 2009, the plaintiff had not yet been arrested as shown by the entry in the detention book alluded to supra.

Also, para 10 of the plaintiff’s replication is fraught with falsehood – that he was detained for fourteen days “being mentally tortured by the defendant … having been detained for so long, after some twelve days in custody. Mr Santu told the plaintiff that if he wanted his freedom, he had to accompany him to his office to ‘talk’. He indicated that the defendant had drafted ‘something’ for him to sign. The police also reiterated that if the plaintiff wanted to be released he had to co-operate. To a man detained in police cells for fourteen days without trial, he had no choice but to do what they wished because he had no idea how long they could keep him detained like that. Mr Santu then said if the plaintiff wanted his freedom, he had to surrender his vehicles to the defendant and sign the letter, affidavit and agreement. It is against this background that the affidavit was presented to the plaintiff on 6 May 2009 to sign. Having been in police custody for twelve days and counting, he signed under duress and fearing that he could be detained indefinitely if he did not sign. … Again he signed (“the letter”) under extreme duress … The next day the ‘agreement’ was brought while the plaintiff was still in police custody. He even asked to read it first or show his lawyer but that was denied again because he was a ‘prisoner.’ So under those circumstances, he was forced to sign the agreement clearly under extreme duress. This is not binding on the plaintiff.”

This is the pith of the alleged duress. As already pointed out above, it is not true that the plaintiff was still in police custody when he signed the documents. In the event, he was not motivated to sign them by any threat, real or imagined, of continued detention as alleged. The plaintiff has accordingly dismally failed to discharge the onus of proving the alleged duress. He who alleges must prove. There is not even a jot or tille of the proof – only wild and unfounded speculation akin to trying a long shot in the dark hoping to hit something.

The foregoing finding, coupled with the evidence of Santu and Mupfumira clearly establishes that the plaintiff was never coerced into signing the documents in question – having signed them when he was already out of custody and after the vehicles had already been delivered. He did so freely and voluntarily. The alleged duress is a figment of the imagination and an after-thought which must be dismissed as such. The Mercedes Benz was returned to the owner Maswera in 2009 while the Nissan truck is parked at the defendant’s premises. The vehicles were supposed to be returned to the plaintiff after he had paid his debt which he has not done.

The plaintiff has not been candid with the court in this suit. The suit was initiated by a party who deemed himself streetwise thereby abusing court process. He deserves to be mulcted with costs on the higher scale.

In the result, I make the following order:

The plaintiff’s claim in convention be and is hereby dismissed in its entirety;

Judgment be and is hereby entered for the defendant in terms of its alternative claim in reconvention as follows:

Payment of the sum of US$108 284-59;

Interest thereon at the prevailing overdraft rates charged by the defendant’s commercial bankers from time to time plus a 5% margin from the date of judgment to date of payment in full; and

Collection commission calculated in accordance with By-Law 70 of the Law Society of Zimbabwe By-Laws, 1982 and costs of suit on a legal practitioner and client scale to the extent that such costs are permitted in proviso (iii) to By-Law 70 (2).

Mudambanuki & Associates, plaintiff’s legal practitioners

Kantor & Immerman, defendant’s legal practitioners