Court name
Supreme Court of Zimbabwe
Case number
SC 4 of 2004
Civil Appeal 313 of 2002

Stambolie v Binga Rural Council and Another (13/02) (SC 4 of 2004, Civil Appeal 313 of 2002) [2004] ZWSC 4 (15 February 2004);

Law report citations
Media neutral citation
[2004] ZWSC 4


DISTRIBUTABLE (5)

















Judgment
No S.C.4\04


Civil
Appeal No 313\02

















JOHN
DESMOND STAMBOLIE v (1) BINGA RURAL COUNCIL
(2) THE REGISTRAR OF DEEDS, BULAWAYO











SUPREME
COURT OF ZIMBABWE


CHIDYAUSIKU
CJ, CHEDA JA & GWAUNZA JA


HARARE
JANUARY 19 & FEBRUARY 16, 2004








I.E.G.
Musimbe
, for the
appellant





H.
Zhou
, for the
respondent









CHIDYAUSIKU CJ: The
appellant in this case sought the following order from the High Court
by way of a court application:-






“1. That the First Respondent
be and is hereby compelled to transfer to the Applicant, stand 297
Binga Township within 7 days from
the date of service of this order
upon it.





2. That
on failure by the First Respondent to transfer to the Applicant,
stand 297 Binga Township as set out in paragraph 1 of this
order, the
Deputy Sheriff or his lawful assistants are ordered to sign all the
necessary documents for the property to be transferred
from the First
Respondent to the Applicant.





3. That
the Second Respondent is ordered to register the transfer of Stand
297 Binga Township from the First Respondent to the Applicant,
on
payment of any competent charges to be levied by the Second
Respondent.





4. The
costs of this application shall be borne by the First Respondent on a
legal practitioner and client scale.”









The application was opposed.
The facts of this case are common cause and straight forward. The
appellant wished to purchase
a piece of land from the respondent.
It would appear some negotiations took place culminating in the
appellant’s legal practitioners
writing the following letter,
Annexure ‘A’, to the respondents. The letter reads as follows:-







“We are instructed that our
respective clients have been conducting negotiations between
themselves privately and have reached a settlement
in this matter.
The terms of the settlement are as follows.






1. Our client will purchase the
Stand in question from your client together with improvements thereon
at a purchase price of $300,000,00.





2. Our
client will pay the rental up to and including January 1998 in the
sum of $74,250.00. This comprises total rent of $85,250.00
less
$11,000.00 paid on account. For the avoidance of doubt, this
excludes the rental which our client has been paying since February
1998 and which our client will continue to pay until transfer of the
Stand.





3. The
Stand is to be transferred into the name of a company controlled by
our client namely Greengrove Properties (Private) Limited.





4. Our
client will pay your client’s legal costs up to but excluding the
application for summary judgment.





5. The
rental arrears as set out in 2 above will be paid in four equal
monthly instalments with effect from the end of the month in
which
transfer of the property takes place. The purchase price of the
property will be payable in cash against transfer and our
client will
obviously bear the transfer costs.





6. For
the avoidance of doubt there will be no interest on the arrear
rental.






We would be glad if you would
take instructions from your client to confirm that the matter is
settled on the above basis. Assuming
that it is, we believe that it
would be in the interests of both parties for a formal agreement to
be drafted and we propose to do
this once we have your confirmation,
unless of course you would prefer to draft the agreement.”










The respondent replied to the
above letter as follows:-






“Re: BINGA RURAL DISTRICT
COUNCIL vs JOHN DESMOND STAMBOLIE AND JACK PENCIL MOLEYA: CASE NO
HC845/97






Your
minute dated 22 April 1999 on the above matter refers.






Please kindly note that the Binga
Rural District Council accepted the above case to be settled along
the proposals set out in your
letter dated 29
th
September 1998 addressed to Calderwood, Bryce Hendrie and Partners.






Please
take note that the case is now being dealt with by Webb, Low and
Barry.”









On the basis of these two
letters the appellant contends that an agreement of sale was
concluded.





Paragraphs
5 and 6 of the founding affidavit set out the cause of action in the
following terms:-






“5. The said terms and
conditions of the sale agreement, were set out in a letter by my
previous legal practitioners, Messrs Morris
Davies and Company,
addressed to the First Respondent’s former legal practitioners,
Messrs Calderwood, Bryce Hendrie and Partners,
dated 29 September
1998, annexed hereto as ‘A’.





6. The
First Respondent accepted the said terms and conditions set out in
the letter dated 29 September 1998, by way of its letter
dated 12 May
1999, of which a copy is annexed hereto as ‘B’, thereby
consisting a legally binding agreement.”









The respondents’ response to
the above allegation is to be found in paragraph 9 of the opposing
affidavit which reads as follows:-







“9. The
averments thereon are not disputed, save to say that the agreement
was never concluded as it was still subject to being formalised,
where the detailed terms such as when exactly payment was to be made,
when exactly transfer was to be effected and who was to effect
the
transfer, and the compliance with the requirements of the Rural
District Council Act were to be included. Accordingly, it
is 1
st
Respondent’s contention, that an agreement was never concluded.”










At the hearing of this matter
in the court
a quo
the respondent argued that the so called agreement of sale was
incomplete and, consequently, not binding. The respondent also
argued
that the agreement was null and void for lack of compliance
with the provisions of section 79(3) of the Rural District Councils
Act
[Chapter 29:13], (“the Act”).







The appellant argued that
agreement between the parties was complete and a compromise of a
previous agreement therefore compliance
with section 79(3) of the Act
was not necessary. The appellant also argued that the respondent
could not raise the issue of non-compliance
with the Act because
there was no factual basis laid on the papers and could not be raised
in the heads of argument for the first
time.







The same arguments raised in
the court
a quo
were relied on by both parties in this Court.







The learned judge in the court
a quo
took the view that the matter should be determined on the basis of
whether or not there was compliance with the provisions of the
Act.
In this regard the learned judge concluded as follows:-







“It is further submitted that
whether the cause of action is based on a compromise or on the
original agreement, the point remains
that, it is an agreement of
sale of council property, therefore section 79(3) of the Act applies.





The
provisions of section 79(3) provide that, before a council enters
into a contract of sale of property of council, the council
shall
call for tenders by notice posted at the office of the council and
advertised in two issues of a newspaper.





It
is clear from the facts of this matter that the procedure outlined in
section 79(3) of the Act, was not followed. What is then
the effect
of that, on the purported agreement.





As
a general rule, a contract of agreement which is expressly prohibited
by statute is illegal and null and void, even where there
is no
declaration of nullity, even where no declaration of nullity has been
added by the statute.






I refer to the case of SA
Investments v Vandashief and Others

1999 (3) SA 340 at page 350. But whether a statutory prohibition
falls within this general rule, depends on the construction of
the
enactment concerned.







Section 79(3) uses the word
shall,
which is peremptory, which points to an intention on the part of the
legislature that the illegality would be visited with a nullity.







It is quite clear that the
procedures laid down in section 79(3) were not followed. As
submitted by the respondent, to uphold such
a contract would be to
defeat the whole purpose of legislation, which to quote from McNALLY
JA, is designed to protect rate payers,
in the case of Gweru, and
indeed taxpayers in general insofar as the council may be subsidised
by Central Government, from what may
broadly be described as insider
dealing. That was in the case of
City
of Gweru v Kombayi

1991 (1) ZLR at page 333.






Considering
the above authorities, I am satisfied that the agreement sought to be
relied on by the applicant is null and void. In
my view, it will
not be necessary for me to address the other aspects raised and,
accordingly, the application is dismissed with
costs.”









The reasoning and the
conclusion of the learned judge in the court
a
quo
cannot be faulted.
The appellant’s contention that the issue of compliance with the
Act was not raised in the affidavit is not
correct. That issue is
raised, perhaps not in the best manner possible, in paragraph 9 of
the respondent’s affidavit. In any
event, as the judge correctly
points out, it is a point of law that can be raised at any stage.
Either the Act was complied with
or was not complied with. The
respondent says there was no such compliance. If it is the
appellant’s case that there was compliance
then it is up to the
appellant to establish such compliance. Nothing was placed before
the court to support the appellant’s contention.







In the result I am satisfied
that the court
a quo
was correct in both its reasoning and conclusion.






Accordingly,
the appeal is dismissed with costs.











CHEDA
JA: I agree











GWAUNZA
JA: I agree
















I.E.G. Musimbe and Partners,
appellant's legal practitioners


Webb,
Low & Barry
, first
respondent's legal practitioners