SAN HE MINING ZIMBABWE (PRIVATE) LIMITED v GWASIRA and OTHERS (445 of 2025) [2025] ZWHHC 445 (28 July 2025)

1 HH 445-25 HCH 5342/24 SAN HE MINING ZIMBABWE (PRIVATE) LIMITED versus LIZZIE GWASIRA and KEITH GWASIRA and KUDAKWASHE MATEVERA HIGH COURT OF ZIMBABWE DEME J HARARE, 24 and 28 July 2025 Opposed Application R T Mutero, for the Applicant R Mabwe, for the 1st – 3rd Respondents. DEME J: The Applicant is seeking the confirmation of the provisional order granted by this court on 26 November, 2024. The Applicant is also seeking a declarator and consequential relief in terms of Section 14 of the High Court Act [Chapter 7:06]. The terms of the interim relief granted by this court is as follows: “That the third Respondent and anyone claiming through it be and is hereby interdicted from attending at and removing chrome from the Special Grant Numbers 8340 and 8341 Mutorashanga.” The Applicant seeks the confirmation of the provisional order together with a declarator and consequential relief under the following terms: “1. Provisional Order granted by this Court on 26 November 2024 be and is hereby confirmed. 2. It is declared that the agreement between the Applicant and second Respondent dated 13 August 2022 remains valid and binding. 3. Consequently, it is declared that during the currency of the agreement between the Applicant, the first and second Respondents are not entitled to enter into any other agreement with any other party in respect of the Special Grants 8340 and 8341. It is further declared that the third Respondent had no right to transact with the first and second Respondents in respect of a Special Grants 8340 and 8341. 4. 5. That the third Respondent be directed to immediately upon issuance of this Order, return 200 6. tonnes of chrome ore to the Applicant's mining location. That the first Respondent and/or second and third Respondents pay costs of this application, jointly and severally, the one paying the other to be absolved on an attorney and client scale.” HH 445-25 HCH 5342/24 In its founding affidavit, the applicant alleged that on 13 August 2022, it concluded a written agreement of sale with the first and second respondents, by which it acquired alluvial chrome‐mining rights over Special Grants SG8340 and SG8341 in Mutorashanga for US$31,000. It further alleged that on 20 November 2024, the third respondent, together with several of his workers, entered the mining sites without its authorisation and began loading and removing chrome ore from its mining location. The application was opposed by the first, second, and third Respondents. They insist that there are material disputes of fact, especially in relation to paragraph 5 of the terms of final relief, where the Applicant seeks the return of chrome ore by way of application. The first and second Respondents also averred that the agreement between themselves and the Applicant has been overtaken by events as the special grants expired. On this basis, they affirmed that the agreement is no longer valid. They also argued that the special grants can only be transferred to any person upon following the prescribed procedures. According to the first and second Respondents, relevant authorities ought to approve the transfer of the mining rights. For this reason, they asserted that the agreement is illegal. Advocate Mabwe argued that the Applicant failed to justify the relief for final interdict. She further claimed that the requirements for final interdict have not been pleaded, and hence, she contended that the court cannot confirm the provisional order under such circumstances. Advocate Mutero made a concession that the consequential relief flowing from paragraph 5 of the terms of final relief raises some material disputes of fact. He urged the court to refer the issue to trial. With respect to the alleged illegality of the contract, Advocate Mutero referred the court to the decision of Hatting and Anor v Van Kleek1, where the court held that: “The cases clearly show that where a contract is on the face of it legal but, by reason of a circumstance known to one party only, is forbidden by statute, it may not be declared illegal so as to debar the innocent party from relief; for to deprive the innocent person of his rights would be to injure the innocent, benefit the guilty and put a premium on deceit.” Advocate Mutero argued that the first and second Respondents must not be allowed to benefit from the illegality which was within their knowledge. Advocate Mutero also referred the court to the case of Hem Granite Industries (Pvt) Ltd v Keely Granite (Pvt) Ltd2. In the case of 1 1997 (2) ZLR 240 (S). 2 2008 (2) ZLR 123 (S) HH 445-25 HCH 5342/24 Hem Granite Industries (Pvt) Ltd v Keely Granite (Pvt) Ltd supra, MALABA DCJ, as he then was, propounded the following remarks: “the general rule of the law of contract is that termination of a contract operates ex nunc, de futuro only and does not affect rights which have accrued to the parties. Termination or extinction of the obligation to perform is restricted to the executory portion of the contract, leaving intact rights which were accrued due and enforceable before termination. Up to the date of termination, the rights have come into existence and can be enforced. In casu the granite blocks had already been won by the respondent in the exercise of the rights given to it under the tribute agreement. They were in its possession, ready to be removed from the mining location at the time of termination of the contract. They had become the property of the respondent by reason of its having performed its side of the bargain subject, of course, to payment of the amount of royalty which had to be calculated in the manner expressly provided for under the tribute agreement. The right to remove the blocks had accrued to the respondent at the time of termination of the tribute agreement and was enforceable against the appellant in the event of interference with its exercise. The only limitation to the exercise of the right of ownership by the respondent was the obligation to pay the amount of royalty determined in the manner specified in the agreement.” Advocate Mabwe argued that the agreement has been overtaken by events following the expiry of special grants. Reference was made to the case of Anhui Foreign Economic Construction (Group) Company Ltd v Minister of Mines and Mining Development and Ors3, where MANGOTA J observed that: “It was within the discretion of the permanent secretary of the first respondent to renew or not to renew the special grants or portions thereof. He chose not to renew the grants following the discovery which was to the effect that the same were not compliant with s 291 of the Act. He also observed that, the stated fact notwithstanding, the fourth, fifth and the sixth respondents had flouted both the law and the parties’ Joint Venture Agreement when they: (a) allowed the grants to operate for an indefinite period of time – and – (b) failed to renew the grants as and when the renewal period of the same had fallen due. The secretary’s conduct in the mentioned regard cannot be faulted. The parties had, at the time that they concluded the Joint Venture Agreement and the Shareholders Agreement, committed themselves to always comply with the mining laws of Zimbabwe. They did not do so. They, in fact connived to, as it were, live outside the law and continue to benefit from their unlawful conduct. They failed to comply with the first condition of the grant and with Clause 9 (i) (a) of the same. Sub-Clauses (ii) and (iii) of Clause (9) of the grants did not apply to them as they were living and operating outside the law. The applicant’s complaint is baseless on the basis of the foregoing. The applicant’s rights in the ceded portions of the grants were taken away from it by operation of the law. The applicant is, in fact, approaching the court with dirty hands. It should clean itself before it seeks the court’s attention to assist it. It cannot, under the circumstances, be allowed to return to the status quo ante 22 February, 2016. The court, in other words, cannot assist it to continue to live outside, but within, the law. 3 HH219/16. HH 445-25 HCH 5342/24 The applicant’s statement which was to the effect that it was the first respondent and his permanent secretary who allowed them to operate the ceded portions of the grant for an indefinite duration is misplaced. The applicant and the fourth respondent committed themselves to abide by the mining laws of Zimbabwe. The first respondent and his permanent secretary did not and do not form part of the parties’ equation. The applicant and its counter-part (i.e. fourth respondent) should therefore have acquainted themselves with what they were committing themselves to. It was incumbent upon the one or the other nor both of them to have drawn the attention of the first respondent and/or the latter’s secretary on the point that the portions of the grants which were ceded to them did not comply with s 291, and other provisions of the Act. They cannot blame anyone for the misfortune which eventually befell them. They made a commitment and, at the same time, made a conscious decision to turn a blind eye on what the law required of them. They cannot, therefore, succeed under the circumstances of this case. The expired grants, or portions thereof, made the ground upon which they rested their operations to fall to pieces. The grants became void and they could not be reinstated except through having them renewed. This, unfortunately for them, was turned down.” Advocate Mabwe also referred the court to Sections 291 and 302 of the Mines and Minerals Act [Chapter 21:05]. Section 291 of the Mines and Minerals Act provides as follows: “(1) The Secretary may issue to any persons— (a) a special grant to carry out prospecting operations; or (b) a special grant to carry out mining operations or any other operations for mining purposes; upon a defined area situated within an area which has been reserved against prospecting or pegging under section thirty-five for a period which shall be specified in such special grant and on such terms and conditions, including terms and conditions relating to the amendment or cancellation thereof, as may be approved by the Minister and shall be incorporated in such special grant. (2) A copy of every special grant issued and of all documents relating thereto shall be retained by the Secretary for purposes of record. (3) The Secretary shall send written notification of the issue of a special grant to every occupier or, if there is no occupier, owner of land falling within the area covered by the special grant.” Advocate Mabwe argued that for the special grants to be transferred, the transfer must be done in terms of Section 302 of the Mines and Minerals Act. Section 302 of the Mines and Minerals Act provides as follows: “The rights granted under a special grant shall be personal to the grantee, who may not cede or assign any such rights to any other person unless authorised to do so by the President.” The issues which arise for determination are: A. Whether provisional order may be confirmed or discharged. B. Whether the agreement can be declared valid and binding given that the special grants did expire. C. Whether the purported agreement is legal. D. Whether the Applicant is entitled to the consequential relief as prayed for. E. What is the effect of the admitted material disputes of fact to the matter? HH 445-25 HCH 5342/24 I will start by making a determination on the validity or otherwise of the agreement after the expiry of the special grants. The starting point is that the courts do not enforce illegal contracts. Reference is made to the case of Dube v Khumalo4. In the case of Anhui Foreign Economic Construction (Group) Company Ltd v Minister of Mines and Mining Development and Ors supra, this court observed that where special grants have expired, the parties can no longer continue with the contract, as doing so would be against the law. After the expiry of the special grants attached to the founding affidavit, I am unable to find any reason why the agreement can be declared to be valid and binding between the parties. It is common cause that the special grants expired. The Applicant attached the special grants to the founding affidavit. Reference is made to pages 30-31 of the record. Expiry dates are endorsed on such special grants. The two special grants expired on 21 March 2023. Thus, at the time of filing the present application, the Applicant was fully aware that the special grants had expired. In light of the decision of Anhui Foreign Economic Construction (Group) Company Ltd v Minister of Mines and Mining Development supra, this court cannot declare that agreement to be binding. No evidence was placed before the court suggesting that the special grants were subsequently renewed after their expiry date. The authorities of Hatting and Anor v Van Kleek supra and Hem Granite Industries (Pvt) Ltd and Keely Granite (Pvt) Ltd supra referred to by Advocate Mutero reinforce the position that an illegal contract cannot be enforced. In the case of Hatting and Anor v Van Kleek supra, the court commented as follows: “Even supposing both parties knew that their agreement was tainted with illegality, as GUBBAY JA (as he then was) said in Dube v Khumalo 1986 (2) ZLR 103 at 109 D-F: - “There are two rules which are of general application. The first is that an illegal agreement which has not yet been performed, either in whole or in part, will never be enforced (by the courts). This rule is absolute and admits no exception. See Mathews v Rabinowitz 1948 (2) SA 876 (W) at 878; York Estates Ltd v Wareham 1950 (1) SA 125 (SR) at 128. It is expressed in the maxim ex turpi causa non oritur actio. The second is expressed in another maxim in pari delicto potior est conditio possidentis, which may be translated as meaning ‘where the parties are equally in the 4 1986(2) ZLR 103 (SC) HH 445-25 HCH 5342/24 wrong, he who is in possession will prevail’. The effect of this rule is that where something has been delivered pursuant to an illegal agreement, the loss lies where it falls. The objective of the rule is to discourage illegality by denying judicial assistance to persons who part with money, goods, or incorporeal rights, in furtherance of an illegal transaction. But in suitable cases the courts will relax the pari delictum rule and order restitution to be made. They will do so in order to prevent injustice, on the basis that public policy ‘should properly take into account the doing of simple justice between man and man’.” “The learned JUDGE OF APPEAL then cited a passage from the judgment of STRATFORD CJ in Jaybhay v Cassim 1939 AD 537 at 544-545 to underscore the point that “in cases where public policy is not foreseeably affected by a grant or refusal of the relief claimed a court of law might well decide in favour of doing justice between the individuals concerned and so prevent unjust enrichment”. The relief for the declarator sought by the Applicant is established in terms of Section 14 of the High Court Act [Chapter 7:06] which provides as follows: “The High Court may, in its discretion, at the instance of any interested person, inquire into and determine any existing, future or contingent right or obligation, notwithstanding that such person cannot claim any relief consequential upon such determination.” Our jurisdiction has defined basic requirements of the application for declarator. In the case of Johnson v Afc5, GUBBAY CJ commented as follows: “The condition precedent to the grant of a declaratory order under s 14 of the High Court of Zimbabwe Act 1981 is that the applicant must be an “interested person”, in the sense of having a direct and substantial interest in the subject matter of the suit which could be prejudicially affected by the judgment of the court. The interest must concern an existing, future or contingent right. The court will not decide abstract, academic or hypothetical questions unrelated thereto… At the second stage of the enquiry, the court is obliged to decide whether the case before it is a proper one for the exercise of its discretion under s 14 of the Act. It must take account of all the circumstances of the matter.” Following the expiry of the special grants, the court will have no reason to declare the agreement valid and binding. Thus, the present application fails to satisfy one of the basic requirements specified in the case of Johnson v AFC supra. This court cannot exercise its discretion in order to validate the agreement which flies against the statutory provisions. In light of the finding that the agreement cannot be declared to be valid and binding, the prayers outlined in paragraphs 3 and 4 for the terms of final order automatically fall away. These paragraphs are dependent upon the validation of the agreement. Once the agreement has not been validated, there is no basis for the granting of the relief prayed for in paragraphs 3 and 4. Further, a determination of the legality or otherwise of the agreement is no longer necessary after I have made a determination that the agreement cannot be declared valid. 5 1995 (1) ZLR 65 (S) at p 72E. HH 445-25 HCH 5342/24 Resultantly, the confirmation or otherwise of the provisional order is equally affected by the expiry of the special grants. The provisional order cannot be confirmed under such circumstances. The provisional order must therefore be discharged. The Applicant prayed for consequential relief in paragraph 5 of the terms of final relief. It prays for an order that the third Respondent be ordered to return 200 tonnes of chrome ore to the Applicant’s mining location. The Applicant alleged that the third Respondent extracted 200 tonnes from its mining location. Advocate Mutero admitted that there are material disputes of fact arising from this relief. He motivated the court to refer the matter to trial. I do agree with this proposal. This approach will bring finality to litigation. Dismissing this relief will not bring finality to litigation. Proceeding by way of action procedure is more disciplined. This will enable the parties to properly define the issues. Trial does have the requisite tools for weighing and assessing evidence. Reference is made to the case of Mashingaidze v Mashingaidze6 where ROBINSON J fabulously remarked as follows: “The Applicant may indeed be able to put forward her claim for relief on alternative grounds when re-commencing proceedings by way of action, a procedure which lends itself more appropriately, both from a pleading and from an evidence point of view, to a resolution of the issues in this matter. In this connection, I would refer again to Masukusa’s case supra, in which, in giving a more general reason as his third reason for dismissing the application, MC NALLY J (as he then was) stated at 236F- 237A: “Procedure by way of notice of motion, though often convenient, is far less disciplined than procedure by action. A good novelist can write a series of exciting affidavits and at the end claim large sums of money. It takes a lawyer to draw a declaration. To draw a declaration it is necessary to analyse your claim and decide exactly what you have to prove.” In the circumstances, it is appropriate that consequential relief outlined in paragraph 5 be referred to trial. The Applicant must therefore draw up the Plaintiff’s declaration in terms of the Rules. Thereafter, the matter must proceed in terms of the Rules. On the question of costs, the costs ordinarily follow the outcome. No justification was advanced to justify a departure from this time-honoured practice. In the result, it is ordered as follows 6 1995 (1) ZLR 219 at 226 HH 445-25 HCH 5342/24 1. The provisional order granted by this court on 26 November 2024 be and is hereby discharged. 2. The application for declarator in terms of paragraphs 2-4 for the terms of final relief be and is hereby dismissed. 3. The prayer for consequential relief in terms of paragraph 5 for the terms of final relief be and is hereby referred to trial under the following conditions: A. The founding papers filed by the applicant in the present application shall be construed to be summons for all intents and purposes while the opposing papers filed by the first-third Respondents shall be regarded as notice of entry of appearance to defend. B. The Applicant / Plaintiff Shall file the Plaintiff’s Declaration within ten days from the date of this judgment. C. Thereafter, the matter shall proceed in terms of the rules. 4. The Respondents shall bear costs of this application to date on an ordinary scale. DEME J:…………………………………………………………… Tabana and Marwa Legal Practitioners, Applicant’s legal practitioners. Tarugarira Sande Attorneys, first- third Respondents’ Legal practitioners.