Court name
Supreme Court of Zimbabwe
Case number
SC 27 of 2006
Civil Appeal 383 of 2003

Zimbos (Pvt) Ltd. v Assetfin (Pvt) Ltd. (83/03) (SC 27 of 2006, Civil Appeal 383 of 2003) [2006] ZWSC 27 (18 July 2006);

Law report citations
Media neutral citation
[2006] ZWSC 27



















DISTRIBUTABLE
(25)



Judgment No. SC.27/06


Civil
Appeal No. 383/03









(1) ZIMBOS (PRIVATE)
LIMITED


(2)
ASSETFIN (PRIVATE) LIMITED





v





ELLAH
MBAIWA








SUPREME
COURT OF ZIMBABWE


CHEDA
JA, MALABA JA & GWAUNZA JA


HARARE,
SEPTEMBER 13, 2005 & JULY 19, 2006








O
C Gutu
, for the
appellants





H
Simpson,
for the
respondent








MALABA
JA: This is an appeal from an order of costs against the
appellants made by the High Court on 10 December 2003 on an
application
for an order of transfer of three stands into the
respondent’s name. The contention on appeal was that the
respondent was not
only partially successful in her claim; her
success was based on the version of events put forward by the
appellants. The grounds
of appeal were set out as being that;






“1. The
learned Judge in the court
a
quo
misdirected
herself by ordering the appellants to pay the respondents costs of
costs of suit in circumstances where the appellants’
version of
events had largely been accepted as the correct version of the court
a quo.







2.
The court
a
quo
misdirected itself
by granting an order of costs in favour of the respondent when a
proper reading of the judgment clearly establishes
that the
respondent had largely failed in her claim to also be granted
transfer of Stand 697 of Subdivision Lot 2A Bluff Hill Townships
as
well as for a refund of the sum of $647 238,86”.





It
was argued that the respondent ought to have been ordered to pay the
costs of the applications.





The
facts are these. The respondent entered into three agreements with
the appellants in terms of which she agreed to purchase
stand numbers
810, 811 and 697 of Subdivision Lot 2A Bluff Hill Townships. The
agreements were signed on 12 October 2001. She was
obliged to pay
the deposit for the properties on the day of signature. The
balance of the purchase price was to be paid from a
loan she had to
secure from a bank within seven days of the date of signature of the
agreements. The total purchase price for the
three stands was $1 518
804.





The
respondent did not secure the loan from a bank within the stipulated
time limit. She paid certain sums of money towards the
balance of
the purchase price for stand 810. It was a term common to each
agreement that should the respondent default in the payment
of the
purchase price the appellants had to give her written notice to
rectify the breach within seven days failing which claim immediate
payment of the full balance of the purchase price or cancel the
agreement.





On
21 January 2002 a written notice was given to the respondent to
remedy the breach within seven days failing which the agreements
in
respect of stands 811 and 697 would be cancelled. On receipt of the
notice the respondent paid to the appellants the sum of $1
220 043.90
by a bank cheque on 31 January 2002. The payment brought the total
amount paid to $2 166 042.86. This was $647 238.86
over the purchase
price for the three stands.





Notwithstanding
the fact that the respondent had purged her breach within seven days
of date of the written notice a letter was
written on behalf of the
appellants on 4 February 2002 cancelling the agreements. When the
respondent demanded transfer of the three
stands on the ground that
the purported cancellation of the agreements was invalid and
threatened court action should her demands
not be met within seven
days of receipt of her letter, the appellants insisted that the
agreements had been validly cancelled and
promised to defend any
action to be instituted by the respondent.





On
23 August 2002 the respondent made an application to the High court
for an order of transfer of the three stands. The opposing
affidavit
filed on behalf of the appellants alleged that she had no right to
the transfer of the stands as the agreements of sale
on which she
based the claim had been cancelled. It was alleged that on
compassionate grounds the appellants had allowed her to
pay for
stands 810 and 811 only after the date of cancellation. In other
words it was being denied on behalf of the appellants that
the
respondent had paid the full purchase price for the three stands. It
was even denied that the bank cheque had been received
on behalf of
the appellants. It was further alleged that the respondent had no
right to the transfer of the stands because they
were subject to a
subdivision which was still to be authorised.





It
is important to quote from the opposing affidavit to show the
attitude the appellants adopted towards the respondent’s claim.





“Ad
para 9:



It
must however be noted that as of the 4
th
February 2002 the applicant had failed to meet her financial
obligations hence the decision to terminate the agreements in respect
of two stands and appropriate the amounts paid to finance the
purchase price of one stand being stand number 810. The cancellation
was legitimate and in terms of the agreement in view of the fact that
applicant had failed to remedy her breaches.







10.2 If anything the applicant
should have been grateful in that despite her default and out of
mercy a subsequent arrangement was
entered into wherein it was agreed
that,







(a) The cancellation of
agreements would only become effective in terms of stand number 697.







(b) The applicant pay the balance
in respect stands 810, and 811 together with interest calculated from
the 10
th
October 200 up to date of payment”.









The
appellants clearly took the position that the cancellations of the
agreements in respect of the three stands was valid. According
to
them the respondent had no right of transfer to enforce in court.
They went on to oppose the application for the order of transfer
of
stands 810 and 811 notwithstanding the averment that on compassionate
grounds she could have the stands transferred into her name.





On
the order sought by the respondent the opposing affidavit stated:





“Ad
para 15:



I take note of the orders being
sought by the applicant in this paragraph and I wish to highlight the
following factors:






(a) Whilst it is every person’s
right to approach the courts for relief it is my submission that such
approach should be of unquestionable
bona
fides
and in this case
the applicant is seeking to enforce a right which she clearly does
not have. As I have shown above the applicant
has always been in
breach of the agreement from its inception. She has been granted
numerous indulgences which she failed to honour
and now seek to
enforce same as rights.






The
respondent legitimately cancelled the agreements on the basis of the
applicant’s breach which is not in doubt and therefore
had, and
still has no legal obligation to transfer any one of the properties
to the applicant.





(b) It
must also be noted that the applicant agreed that she was in total
breach of the agreement hence her plea that she should at
least be
allowed to have only two stands instead of three to which the
respondents agreed, not because the applicant was entitled
to same
but as a result of the humane face which the respondents have to the
situations of the applicant.






(c) The agreement was that after
the cancellation the applicant would pay the balance and interest
outstanding on the two properties
which she did. One wonders why if
she had such a
right,
she failed to tender payment in respect of the plot in question. The
whole application is ill conceived and an after thought.






(d)
The Respondents have no objections in transferring stand Number 811
and 810, however, this is subject to a certificate of compliance
having been issued by the responsible authority in terms of the
subdivision permit. The Respondents cannot transfer stand 697 as
the
agreement was lawfully cancelled.







(e) ...





(f)
I humbly submit that application and orders  sought by the
applicants should be dismissed with costs as the whole application
was not necessary in the first place”.








Far
from conceding that the respondent had a right to transfer of the
stands the appellants maintained that she had no such right
as the
agreements on which her claim was based had been validly cancelled.
They were of course equivocal as to their position in
respect of
stands 811 and 810 but were clear that if they were to transfer these
stands to her it would not be because they recognised
a right in her
to the transfer but that it would be out of compassion for her. It
is quite clear that in the face of such equivocation
on the part of
the appellants on her right to the transfer of the stands the
respondent had no choice but to apply to court for
the determination
of her rights. The appellants compelled her to incur the costs of
the application for the order of transfer.





Although
it was alleged on behalf of the appellants that an agreement was
reached after the cancellation of the original agreements
of sale,
that the respondent would pay for stand 810 and 811 there was no
evidence of such an agreement. There would have been
no need for
the appellants to declare that the respondent had no right to claim
transfer of the two stands. It appears to me the
respondent was
substantially successful in her claim. The court
a
quo
had a discretion
to award her the costs because the attitude of the appellants was
clearly that she had to prove her entitlement
to the order of
transfer.





On
the other hand the respondent failed on her claim for the transfer of
stand 697 and the refund of $647 238.86. In holding that
there was a
dispute of facts which could not be resolved on the papers in respect
of the claim of transfer of stand 697 and the refund
of $647 238.86
the court was effectively saying that she should not have proceeded
by way of an application. The court
a
quo
accepted the
appellants’ contention that they were forced to incur costs
defending a claim which ought not to have been brought
to court on an
application. It was unfair to order the appellants to pay “costs
of suit” in the circumstances when the respondent
should have been
ordered to pay their costs in respect of the unsuccessful claim for
the transfer of stand 697 and the refund of
$647 238.86. The
applicants have been partially successful on appeal.





The
appeal succeeds with costs to the extent that the order of costs of
the court
a quo
in para 3 is set aside and substituted with the following:






“3. That
the 1
st
and 2
nd
Respondents pay the applicant costs in respect of the claim of
transfer of stands 810 and 811.






4. The
claim in respect of the transfer of stand 697 and the refund of the
sum of $647 231.86 be and is hereby dismissed with costs”.















CHEDA
JA: I agree.











GWAUNZA
JA: I agree.











Messrs
Gutu & Chikowero
,
appellant's legal practitioners


Messrs
Mushonga & Associates
,
respondent's legal practitioners