Samvura And Another v Saltana Enterprises (Private) Limited And 3 Others (6 of 2021) [2021] ZWHHC 6 (7 January 2021)

1 HH 6/21 HC 10730/15 CHARLES SAMVURA and SONENI SAMVURA versus SALTANA ENTERPRISES (PVT) LTD and DAVID PFUKWA MUTINGWENDE and ANTORNY ERNEST PAHWARINGIRA and DANMORE BATSIRAI HIGH COURT OF ZIMBABWE CHIKOWERO J HARARE, 16, 17 December 2020 and 7 January 2021 Trial M. Mtlongwa, for the plaintiff R. Munhuweyi, for the 1st and 2nd defendants 3rd defendant in default T. L Shaka for the 4th defendant CHIKOWERO J: This is a double sale situation. On 4 April 2002 and at Harare the plaintiff purchased the right, title and interest in a certain piece of land situate in the district of Salisbury called stand 7872 Warren Park Township of Warren Park. It is a residential stand measuring 1 012 square metres. The seller was the 1st defendant (Saltana), represented by the 2nd and 3rd defendants (the directors) in the transaction. The purchase price was the sum of one million two hundred and fifty seven thousand and five hundred dollars ($1 257 500). This amount was paid in full. Despite filing a joint plea wherein they averred that plaintiffs breached the agreement by failing to pay the purchase price, leading to 1st defendant cancelling that agreement, the 1st and 2nd HH 6/21 HC 10730/15 defendants admitted at the Pre Trial Conference that both the plaintiffs and the 4th defendant purchased the right, title and interest in the property in question and both paid the purchase price in full. In addition, 1st defendant admitted that it was liable to the plaintiffs. On 12 December 2011 Saltana, represented by the same directors, had gone on to sell the right, title and interest in the same property to the 4th defendant at a purchase price of thirteen thousand United States dollars (US$13 000.00). By 2004 the plaintiffs, who both testified, had liquidated the purchase price and had been given vacant possession. However, they neither took occupation nor put any structure on the property. They were advised by the seller that it would be illegal to effect improvements on the land because City of Harare had not yet issued a certificate of compliance in respect of not only that particular piece of land but for all other pieces of land in that area. The plaintiffs then moved to South Africa where they have been working and staying ever since. During the festive season shutdowns in that country the 1st plaintiff would come to Zimbabwe. He would visit the stand as well as check progress with Saltana relating to the issuance of a certificate of compliance. It was during one such visit, in 2014, that the 1st plaintiff discovered that 4th defendant had put up a temporary structure on the piece of land in question. The former confronted the latter. 4th defendant revealed that he also had purchased from Saltana the right, title and interest in the property. This prompted the 1st plaintiff to alert the 2nd and 3rd defendants of this scenario and queried how this would be so. 2nd defendant denied the existence of the second agreement of sale. Thereafter the 1st, 2nd and 3rd defendants became evasive. Left with no option, the plaintiffs instituted this action. They pray that the court upholds their agreement of sale, order the ejectment of the 4th defendant and that all the defendants pay the costs of suit. The alternative relief that they seek is that the 1st, 2nd and 3rd defendants pay damages in the sum of twenty two thousand seven hundred dollars (US$22 700) being the value of the piece of land. HH 6/21 HC 10730/15 The alternative relief is based on the alleged fraud and recklessness, on the part of 2nd and 3rd defendants (as directors of 1st defendant) in representing 1st defendant in entering into the second agreement of sale well knowing of the existence and validity of the first. 1st defendant’s liability is premised on it being the contracting party. 4th defendant pleads that he is an innocent purchaser. He had no knowledge of the existence of the prior agreement when he contracted with Saltana. The issue for determination is whether there are special circumstances affecting the balance of equities. If such circumstances exist, I will not grant the main claim. Another issue would then arise, namely, whether the plaintiffs have established a case for 2nd and 3rd defendants to be held personally liable and whether the quantum of damages has been proved to enable the court to order the 1st, 2nd and 3rd defendants to pay such damages (US$22 700). In this case, none of the purchasers has taken transfer.  In this vein, Mr Mtlongwa referred me to the applicable law. In Guga v Moyo 2000 (2) ZLR 458 (S) MCNALLY JA, with the concurrence of GUBBAY CJ and MUCHECHETERE JA, said at 459 E – F: “The basic rule in double sales where transfer has not been passed to either party is that the first purchaser should succeed. The first in time is the stronger in law. The second purchaser is left with a claim for damages against the seller, which is usually small comfort. But that rule applies only in the absence of special circumstances affecting the balance of equities.” See also Crundall Brothers (Pvt) Ltd v Lazarus NO and Another 1991 (2) ZLR 125 (SC). I am satisfied that there are no special circumstances affecting the balance of equities in favour of 4th defendant. Fourth defendant has failed to discharge his onus in that regard. See Chimphonda v Rodriques and Others 1997 (2) ZLR 63 (H); Barros and Another v Chimphonda 1999 (1) ZLR 58 (S). He admits the illegality of the cottage that he has constructed on the piece of land in question. No evidence was adduced to show that the City of Harare has since issued a certificate of compliance which would pave way for construction to commence provided one has a building plan approved by Council. 4th defendant’s occupation of the piece of land cannot be a special circumstance as that occupation is inseparable from the cottage. The cottage is physical evidence of the occupation. That he has expended an undisclosed amount of money in erecting the illegal cottage is not a special circumstance. The source of that money does not change anything. Neither is the sentimental value that he attaches to that structure, being, as he claims, his only home. The source of income was neither established nor does it matter at all. Counsel for the HH 6/21 HC 10730/15 plaintiff referred me to Muchengeti v Chawaita and Another HH 19/18 where, at p 3 of the cyclostyled judgment, ZHOU J said: “Expenditure upon an illegal structure does not constitute a special circumstance which would tilt the balance of equities in favour of the defendants. The defendants stated that they were authorized to construct the illegal structure by Maffack Properties. The structure does not constitute an improvement upon the property. It is actually an expense as it would have to be demolished at some point. The defendants must therefore look up to Maffack Properties (Pvt) Ltd and/or Lovemore Mafuta for the recovery of any loss incurred in erecting the structure. After all, they have already enjoyed use and occupation of the property to the prejudice of the plaintiff.” I share these sentiments. They apply with equal force to this matter. I am also satisfied that fourth defendant was not an innocent purchase. He was a poor witness. He was extremely evasive under cross examination. He said that at the time he entered into the agreement of sale second defendant neither told him that the plaintiffs had purchased the right, title and interest in the same property nor told him that the first agreement had been cancelled. He thus contradicted second defendant in a fundamental respect. The second defendant, who co-represented the seller, said that he told the fourth defendant at the time of contracting that the right, title and interest in the piece of land in question had been sold to the plaintiffs but that agreement had since been cancelled. Fourth defendant was unable to explain that contradiction. I have no difficulty in accepting the second defendant’s evidence in this regard. It is in line with the first and second defendant’s plea issued on 29 May 2019. The relevant portions of that plea read as follows: “3. 4. 5. 6. 3. Assuming that the intention is to say plaintiffs entered into an agreement of sale with first defendant represented by the second and third defendants, this position is not denied, however, the agreement of sale was cancelled according to a cancellation clause thereto and the first defendant retook possession of the property. The plaintiffs failed to pay the purchase price and committed a material breach which disentitled them to the right they allege to have accrued. It is therefore vehemently denied that the defendants maliciously sold the property to the fourth defendant. The sale to the fourth defendant was well above board and was done after due cancellation of the agreement of sale between plaintiff and first defendant. The fourth defendant is the correct and rightful owner of the said stand him having purchased same after cancellation of the previous agreement between plaintiffs and first defendant. Plaintiffs are not entitled to the relief they seek by virtue of them not having complied with the agreement of sale which they rely on which was cancelled and therefore their claim ought to fail. WHEREFORE the defendants pray for the dismissal of the plaintiffs claim as against all of them with costs on the higher scale of attorney and client.” HH 6/21 HC 10730/15 A prudent purchaser would ask for a copy of the letter of cancellation to enable him or her to commence due diligence exercise. The fourth defendant did not do this. He was afraid to discover the truth. Having been diligent in his ignorance he cannot successfully aver that he is an innocent purchaser. That is not all. Plaintiffs issued summons on 6 November 2015. The same was served on 4th defendant two days later. He entered appearance to defend on 14 December 2015. On 19 January 2016 4th defendant filed his plea. The plaintiff’s Pre Trial Conference papers were served personally on 4th defendant on 29 April 2016. Yet the fourth defendant, well aware of the pendency of this matter, was signing an agreement of sale with City of Harare on 9 April, 2018 in terms whereof council was purporting to sell the right, title and interest in the same property to the fourth defendant. The effect would be that fourth defendant would have two agreements of sale with two different entities over the same piece of land. Meanwhile, he continues to defend the present suit on the basis of the agreement of sale which he finds convenient for the purpose. That conduct is utterly deplorable. The purported agreement of sale between 4th defendant and council, made to bolster the fourth defendants’ case, is of no consequence to these proceedings. Plaintiffs lawfully purchased the right, title and interest in the piece of land in question and paid the purchase price. That agreement of sale was never cancelled. Infact, first defendant admitted at the Pre-Trial Conference that it is liable to the plaintiffs. In effect, this trial was to determine who between the plaintiff and fourth defendant should get the property in question. There being no special circumstances affecting the balance of equities in favour of the 4th defendant, the main relief sought by the plaintiffs succeeds. This conclusion makes it unnecessary for the court to discuss the merit or otherwise of the alternative remedy sought. In the result the following order shall issue: 1. The agreement of sale entered into between Saltana (Private) Limited and Charles Samvura and Soneni Samvura on 4 April 2002 in terms whereof the latter purchased the right, title and interest in a certain piece of land situate in the Salisbury District called Stand 7872 Warren Park Township of Warren Park being a residential Stand measuring 1 012 square metres be and is declared to be valid. 2. The 4th defendant and all those claiming through him shall vacate stand 7872 Warren Park Township of Warren Park failing which the Sheriff shall evict them. HH 6/21 HC 10730/15 3. The first and 4th defendants shall pay the plaintiffs’ costs of suit jointly and severally the one paying the other to be absolved. 4. As between the plaintiffs and the 2nd and 3rd defendants each party shall bear its own costs. Mangezi, Nleya and Partners, plaintiff’s legal practitioners Munhuweyi and Associates, 1st and 2nd defendants’ legal practitioners Koto and Company, 4th defendants’ legal practitioners