Reggie Saruchera (in his capacity as Judicial Manager for Agrifoods (Private) Limited, Cresta Poultry Group (Private) Limited and Manicaland Farmers Co-op (Private) Limited) v Silo Foods Industries (2) CFI Holdings Limited (3) Master of the High Court

### Preamble
Judgment No. SC 104/20
1
Civil Appeal No. SC 155/19
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DISTRIBUTABLE:         (95)

REGGIE     SARUCHERA

(IN     HIS     CAPACITY     AS     JUDICIAL     MANAGER     FOR      AGRIFOODS

(PRIVATE)     LIMITED,     CRESTA     POULTRY     GROUP     (PRIVATE)

LIMITED     AND

MANICALAND     FARMERS     CO-OP     (PRIVATE) LIMITED)

v

SILO     FOODS     INDUSTRIES     (2)     CFI     HOLDINGS     LIMITED     (3)     MASTER     OF     THE     HIGH     COURT

SUPREME COURT OF ZIMBABWE

MAKARAU JA, HLATSHWAYO JA & MAKONI JA

HARARE: OCTOBER 10, 2019 & JULY 17, 2020

T Magwaliba, for appellant

S Hashiti, for first respondent

R Goba, for second respondent

No appearance for third respondent

MAKARAU JA:   This is an appeal against the whole judgment of the High Court handed down on 6 March 2019, restraining the appellant and second respondent from executing a ruling made by the third respondent at a meeting of the creditors of the companies under the appellant’s judicial management, held on 13 February 2019.

Background Facts

The second respondent is a shareholder in three companies that were placed under the judicial management of the appellant. These are Agrifoods (Private) Limited, Cresta Poultry (Private) Limited and Manicaland Farmers Co-op (Private) Limited. To enable him to pay off the creditors and to resuscitate the business of the three companies, the appellant, as judicial manger, requested the second respondent and other shareholders to inject capital into the companies. The shareholders failed to inject the required capital prompting the appellant to invite bids from interested parties to invest in the companies. A company that is not a party to these proceedings emerged as the first or highest bidder whilst the first respondent was the second.

At a meeting called to consider the bids, the creditors requested the highest bidder to revise its bid and commit to certain payments and repayment period. The highest bidder was unwilling to commit as demanded. The appellant then turned to and engaged the first respondent as the second highest bidder. In response, the first respondent made an offer which was conditional upon the second respondent agreeing to dispose to it certain land and buildings. The second respondent was unwilling to dispose of these assets and the first respondent dropped the condition attaching to its offer.

A second meeting of the creditors was held before the third respondent to reconsider the bids.  This was on 13 February 2019. At the meeting, the appellant advised the creditors of a counter bid made by the second respondent outside the bidding process and which was higher than that made by the first respondent.  The first respondent objected to the consideration of the bid by the second respondent on three grounds. These were firstly that the offer was made outside the bidding process, secondly that the second respondent, being a shareholder, had the unfair advantage of seeing the offers made by the other bidders before it made its own and finally that the second respondent had failed to inject the required capital when called upon to do so before the bidding process.  The second respondent argued per contra that since its offer was better, the appellant should not only consider the offer but accept it.

The record of the proceedings indicates that other creditors expressed their own views on the matter. The third respondent ultimately made a ruling in concluding the meeting. He declared that the offer made by the first respondent was invalid as it was conditional. He directed that the first and second respondent both submit fresh bids which would be considered at a later date and at which the highest bid of the two would be accepted. No reference was made in the ruling to the fact that the condition attaching to the first respondent’s offer had been dropped.

Aggrieved by this decision, the first respondent filed an application in the court a quo to review the ruling by the third respondent. Pending determination of the review proceedings, the first respondent sought and was granted an interim interdict restraining the appellant and the second respondent from proceeding in terms of the ruling made by the third respondent on 13 February 2019.

As stated above, the appellant noted this appeal against the decision of the court a quo granting the interdict.

The appeal

In his notice of appeal, the appellant raised three grounds. He argued firstly that the court a quo granted relief that neither of the parties had sought. Secondly, he contended that the court a quo erred in interdicting a process that the first respondent had agreed to and which process had already taken place. Finally, he argued that the court a quo erred in holding that the first respondent had established a prima facie case warranting the issuance of the interdict.

This appeal is without merit.

The appeal raises three issues. These are whether the court granted an order that the first respondent had not sought, whether the court erred in finding that the first respondent had not acquiesced to the conduct interdicted and finally whether the court a quo erred in granting the interdict as it did.

I deal with each issue in turn.

Did the court a quo grant an order that was not sought?

The appellant fell into grave error when he contended that the court a quo granted an order that the first respondent had not sought.

It is common cause that the first respondent approached the court to stop the execution of the ruling by the third respondent. Attached to the urgent application was a draft order inelegantly framed in relation to the interim relief sought to read:

“Pending the finalisation of this matter, that the first and second respondents be and is hereby interdicted from executing the Master’s ruling handed over on 13 February 2019 in favour of the first respondent against applicant under Case No HC 7608/16, pending finalisation of the review lodged.”(sic)

The draft order had clear grammatical errors. Further, it did not state whether the interim relief was sought pending the finalisation of the urgent application to which it was attached or was sought pending the determination of the review application which the first respondent had filed earlier as it made reference to both matters in its opening and conclusion, respectively. The draft order also erroneously referred to the third respondent’s ruling as having been made under case no HC7608/16. It is common cause that the third respondent made the ruling of 13 February 2019 during a creditors meeting and that HC7608/19 is the High Court case under which the appellant was appointed judicial manager of the three companies whose full details I have given above. There was therefore no ruling by the third respondent under the case reference nor in practical terms, could there be.

Having been satisfied that the first respondent was entitled to the interdict sought, the court a quo amended the draft order to remove the obvious grammatical errors and to indicate with greater clarity that it was granting the interim relief pending the finalisation of the urgent application.

Whilst draft orders have to be attached to all applications for completeness of form and to conform to the rules of court, they do not bind the court. The court retains in all instances and in all respects, the power to issue an order that is consistent with the relief sought by the applicant and is in accordance with the law. It also stands to reason that the court, having the final word in the matter, issues an order that is devoid of grammatical and other elementary errors.

The conduct of the court a quo in amending the draft order as it did must be contrasted with and distinguished from the conduct that was criticized in Shorai Mavis Nzara and Others v Cecilia Kashumba N. O. and Others SC 18/18. In that matter, the lower court was found to have gone on a frolic of its own. It gave an order which it thought was fair and equitable, an order that had not been sought by any of the parties and all this in an effort to find what it considered to be middle ground in the dispute.

By no stretch of the imagination is Nzara and Others v Kashumba and Others (supra) authority for the somewhat startling contention by the appellant that a court cannot correct patent grammatical and other elementary errors in a draft order.

It is my finding that the court a quo had the power to amend the draft order as it did. In doing so, it did not alter the substance of the order sought. It did not give an order different in nature or in meaning from the order that had been sought. It merely made the order clearer. What the law prohibits is for a court to grant relief that is completely divorced and different in nature from the relief sought by the applicant or to issue an order on issues that have not been canvassed during the hearing of the matter.

Clearly devoting the bulk of his time and energies to this one ground, counsel for the appellant further argued that it was incompetent for the court a quo to amend the draft order as it did in the absence of an application seeking such an amendment.

It is not necessary that a court should wait to be formally requested to clean up a draft order through an application. It can, and should in fact do so mero motu, to enable it to issue an order that not only makes sense but, is in accordance with the law. This it must do provided that in doing so, it does not alter the nature and substance of the order sought. Whilst it is true that it must be the litigants who must be heard on the relief that they are seeking from the court, it is also the position at law that the court has the final say in and full responsibility for the order that it issues.

It is therefore my finding that the court a quo did not err in amending the draft order as it did. Accordingly, the first ground of appeal fails.

Did the court a quo err in finding that the first respondent had not acquiesced to the conduct interdicted?

The appellant argued that the court a quo erred in granting an interdict in favour of the first respondent in circumstances where the first respondent had consented to the course of action directed by the third respondent in his ruling. In this regard, the appellant made reference to the fact that the first respondent had, a few hours before attending the hearing of the urgent application a quo, submitted a fresh bid as directed by the third respondent.

This argument was raised and rejected a quo. In rejecting the argument, the court a quo made a specific factual finding that the first respondent had not consented to be bound by the ruling. In its words:

“The respondents argued that by participating in the process of presenting offers which had happened in the morning of the day of the hearing, the applicants are estopped from proceeding with the application taking into account that the application has been overtaken by events.

The applicant made it clear that it protested the continuation of the process of presenting offers as this application had already been set down and was to be heard in a few hours. The applicant had already taken steps to safeguard its interests by approaching court….. It therefore cannot be said that the relief prayed for by the applicant had been overtaken by events. Neither can it be taken against applicants that they participated in the morning proceedings, it was under protest.”

Thus, it was the finding of the court a quo that the first respondent had protested against the conduct sought to be restrained and had protected its rights in that regard by not only filing the application for review but by also seeking the interdict.

In his grounds of appeal against this finding, the appellant has not alleged that the court a quo was irrational in its decision. He merely repeats the argument that he raised a quo. In the absence of an allegation that the decision of the court a quo in this regard was irrational, the contention cannot be an issue for fresh determination on appeal.  In other words, the court a quo having found that the first respondent had not acquiesced to the ruling, this court cannot revisit and determine the issue afresh. This is so because of the settled position at law that limits the powers of an appeal court to interfere with the lower court’s findings of fact only to instances where the finding is irrational. No argument having been mounted showing that the finding by the court a quo was irrational, and none being sustainable in any event in the circumstances of this matter, the appellant cannot obtain relief under the second ground of appeal.

Whether the court a quo erred in granting the interdict as it did

Finally, and in the third ground of appeal, the appellant argued that the court a quo erred in granting the first respondent relief which it had not established. In particular, it was argued that the first respondent did not show that its application for review, whose pendency it raised as a basis to restrain the appellant and second respondent from proceeding to implement the decision of the third respondent, had any prospects of success.

The requirements for the grant of a temporary interdict are settled. (See ZESA Staff Pension Fund v Mushambadzi 2002(2) ZLR 205(5). There is no dispute in this appeal on the requirements and applicability of the law in this regard.

As stated above, it was the appellant specific argument in this appeal that because the first respondent did not show that its application for review before the court a quo had any prospects of success, it had thereby failed to establish a prima facie right worthy of protection.

This issue was not raised and argued a quo. It was improperly raised for the first time on appeal and without the appellant having laid out the basis for raising the issue this late in the proceedings. Not having been an issue a quo, it is not an issue for determination on appeal.

The third ground of appeal has no merit and is dismissed. The court a quo did not err in granting the interdict as it did.

Before I dispose of this appeal, I wish to comment in passing on the position adopted by the second respondent in this matter.  Clearly in an effort to support the appellant, the second respondent filed heads of argument that supported the appeal and sought to have the judgment a quo set aside on the grounds that had been raised by the appellant. At the hearing of the appeal, the second respondent sought to abandon the judgment and to argue the merits of the appeal not as a respondent but as a co-appellant. It did not formally abandon the judgment but sought to use its position as a respondent to support the appellant in his quest to have the judgment set aside.

On the authority of Nelson Chamisa v Emmerson Dambudzo Mnangagwa and Ors CCZ 21/19 wherein three of the respondents had sought to support the petition as co-petitioner after filing notices of opposition, the court declined to hear the second respondent as a co- appellant save on the question of costs. Whilst the decision in Chamisa v Mnangwagwa (supra) was premised on an interpretation of the Constitutional Court Rules, the ratio and underlying reasoning in that decision applies with equal force to an interpretation of the Supreme Court rules on appeals. When a notice of appeal is served upon the respondents, it warns the respondent of the basis upon which the judgment in issue will be impugned and the relief that will be consequently sought. It invites the respondents to prepare to defend the judgment impugned. A notice of appeal is not an invitation to the respondents to support the appeal. The rules of court provide separately and adequately for litigants to abandon judgments in their favour if they so wish. The rules do not provide for such abandonment to be during the hearing of the appeal and by way of supporting the appeal.

Regarding costs, there is no justification for departing from the general position that these should follow the cause.

In the result, I make the following order:

The appeal is dismissed with costs.

HLATSHWAYO JA:			I agree

MAKONI JA:				I agree

Wintertons, appellant’s legal practitioners

Sande Legal Practice, 1st respondent’s legal practitioners

Mushoriwa Pasi Corporate Attorneys, 2nd respondent’s legal practitioners