Tapvice Ent. (Pvt) Ltd v Saruchera N.O. & Ors (HC 3780 of 2014) [2015] ZWHHC 371 (13 April 2015)

1 HH 371-15 HC 3780/14 TAPVICE ENTERPRISES (PRIVATE) LIMITED versus R. F. SARUCHERA N. O. (cited in his official capacity as the Judicial Manager of Blue Ribbon Foods Limited) and TETRAD INVESTMENTS BANK LIMITED and THE MASTER OF THE HIGH COURT HIGH COURT OF ZIMBABWE MANGOTA J HARARE, 17 February, and 14 April, 2015 Opposed matter O Takaindisa, for the plaintiff T Nyamasoka, for the 1st defendant MANGOTA J: On 9 May, 2014 plaintiff issued summons against the first defendant and two others. It claimed from the first defendant payment or release of $2 651 633.63 and from the first and second defendants, jointly and severally the one paying the other to be absolved, the sum of $1 407 355.35 which it said were consequential damages and holding over damages. The first and second defendants’ appearance to defend were respectively entered on 16 May, and 14 June, 2014. The third defendant remained uncommitted in respect of the plaintiff’s claim. The first and third defendants, it was observed, were cited in their official capacities. Subsequent to their appearance to defend, the first defendant addressed a letter to the plaintiff. He did so on 16 May, 2014. The letter aimed at drawing the plaintiff’s attention to two matters. These were that: HH 371-15 HC 3780/14 (i) the company to which the first defendant was appointed judicial manager was under judicial management and could not, therefore, be sued without the plaintiff having sought and obtained leave of the court to sue it- and (ii) the summons did not disclose a cause of action and was not, in that regard, compliant with the rules of this court. He, on the basis of the stated matters, insisted that the proceedings which the plaintiff instituted were a nullity. He urged the plaintiff to rectify what he said were defects in the process failing which he would take an exception. The plaintiff responded to the matters about which the first respondent wrote to it. It did so through a letter which was dated 19 May, 2014. It maintained the position that everything which pertained to the action was above board and was, therefore, in order. It remained adamant that no leave of the court was required to sue the first defendant. It insisted that the action which it set into motion was directed not at the company which was under judicial management but at the first defendant who was the company’s judicial manager. It submitted that the cause of action was not only very clear but was also unambigous. It stated that the first defendant, as judicial manager of the company which was under judicial management, acted beyond his jurisdiction as stated in its declaration. The position which the plaintiff took compelled the first defendant to take an exception. He filed the exception with the court on 30 May, 2014. The exception constitutes the subject matter of the present proceedings. The plaintiff made the work of the court a lot easier than otherwise when it cited the first defendant as it did. It cited him not in his personal capacity. It cited him in his official capacity as the judicial manager of Blue Ribbon Foods Limited. It, in essence, acknowledged the fact that the decision which the first defendant made was not for the benefit of the first defendant himself but for that of the company to which the court appointed him judicial manager. It acknowledged, further, that whatever decision he made was taken by him in the course of his work as the judicial manager of Blue Ribbon Foods Limited. He was or is, as was stated in Lennard’s Carrying Co. Ltd v Asiatic Petroleum Co. Ltd, [1915] AC 705, “Somebody who for some purposes may be called an agent, but who is really the directing mind and will of the corporation, the very ego and centre of the personality of the corporation…… Somebody for whom the company is liable because his action is the very action of the company itself”. [emphasis added] HH 371-15 HC 3780/14 The above cited words pertained to the meaning, role and duties of a director of a company. The words, however, assume the same meaning and effect when they are viewed in light of the office of the judicial manager whom the court appoints in terms of s 302 of the Companies Act, [Chapter 24:03]. Tett and Chadwick stated in their Zimbabwe Company Law, second Edition, that a judicial manager has all the duties and obligations of a director of the company. It requires little, if any, emphasis to state that a judicial manager’s appointment transfers power and authority from all persons who were or are vested with the management of the company’s affairs and places that power and authority into the hands of the judicial manager whom the court, through the Master’s Office, supervises on a regular basis. He, to the stated extent, is an officer of the court who cannot be sued in his personal, or official, capacity for decisions which he took or takes, during the course of his work as judicial manager of a company which is under judicial management. The plaintiff in casu sought to make a distinction between the judicial manager and the company to which the court appointed him as manager. It sought to distinguish between the first defendant and Blue Ribbon Foods Limited which the court placed under a provisional judicial management order on 5 September 2012 and which order was subsequently confirmed on 22 July, 2013. The plaintiff, in the view which the court holds of the matter, suffered a serious misunderstanding of the law when it acted as it did. It made a bold but uncalculated decision when it sought to make a distinction where there was none. The court was satisfied that the first defendant was and remains part and parcel of the judicial management process from which he could not and cannot be divorced. The plaintiff was, accordingly, very naïve when it argued as it did in the face of unambiguous circumstances which the first defendant, out of an abundance of caution, drew its attention to for its own benefit. The court was not all amused by the stance which it took on that aspect of the case. The argument which it raised and made every effort to sustain was unsustainable. It could not and did not hold. The plaintiff indicated that, its summons was drafted in terms of Form No. 2, r 12 (1) of the rules of this court. The face of the summons stated as much. Form No. 2 as read with r 12 (1) states in clear and categorical terms that a summons which is drafted as such must give a concise statement of the nature, extent and grounds of the plaintiff’s cause of action and of the relief or remedies which he is seeking. HH 371-15 HC 3780/14 The manner in which the plaintiff drafted its summons was the first defendant’s second port of call. He argued that the summons was defective in that it did not give a clear and concise statement of the nature, extent and grounds of the plaintiff’s cause of action. The plaintiff was of a contrary view. It argued that the summons was clear and unambigous. It stated that the first defendant, in his capacity, as judicial manager, acted beyond his jurisdiction. It maintained that the declaration which it attached to the summons was clear and concise on what its cause of action was. The summons, as a stand alone document, appeared to have been the first defendant’s main area of concern. The plaintiff it has already been observed, endorsed on its face that it was issued in terms of Form No. 2 as read with r 12(1) of the rules of this court. Its contents, however, departed materially from what Form No. 2 as read with r 12 (1) stipulates. The summons, in part, read: “To the defendants named above: (a) that the 1st respondent pays/releases $2 651 633.63 to the plaintiff; (b) that the 1st and 2nd defendants pay each one the other to be absolved the sum of $1 407 355.35 being consequential damages and holding over damages until the whole sum has been extinguished; (c) that the 1st defendant pays costs of suit”. Whilst the observed endorsement appeared on the face of the summons, there is no doubt that the plaintiff issued and filed the summons in terms of r 113 of the rules of this court. The rule offers a discretion to the plaintiff to file and serve its declaration with the summons. It is for the mentioned reason, if for no other, that the plaintiff insisted that the summons should be read together with the declaration. The declaration as read together with the annexures which the plaintiff attached to it makes the summons compliant with r 11 (c) as read with r 109 of the rules of this court in respect of the first of the plaintiff’s two claims. The summons, taken and read in the stated form, sufficiently informed the first defendant of what the plaintiff was or is claiming from him particularly in so far as its first claim was concerned. The parties are in this regard referred to paragraphs 5,6,7,9 and 10 as read with para 11 of the plaintiff’s declaration. There was, however, a minor error in so far as para 7 was concerned. The plaintiff should, in the court’s view, have couched it in the following words: “Consequently, an Escrow Account was opened with the 2nd defendant under Account Number 13005624” HH 371-15 HC 3780/14 Annexure B which the plaintiff attached to the declaration was relevant on this aspect or the case. The annexure stated in a clear and concise language that the account was opened with the second, and not the third, defendant. The plaintiff conceded that its claim for what it described as consequential damages and holding over damages was badly pleaded. The claim was incurably defective, in the court’s view. It raised more questions than it furnished answers to them. It did not comply with any of the rules of this court. Not only was it vague and embarrassing but it also did not disclose any cause of action against the first defendant. The embarrassment it contained could not and cannot be cured by a request for further particulars or even for further and better particulars. The claim could not and cannot hold at all. In the view which the court holds of the matter, the plaintiff was the author of its own misfortunes. It realised that the first defendant had taken a decision which was adverse to its own interests. It realised, further, that the decision which the first defendant took was made by him in his official capacity. That knowledge on its part notwithstanding, it proceeded to sue him. When its attention was drawn, in written form, to the fact that it should not have done so, it, for reasons best known to itself, insisted that the action which it took was in order. It did not, in that regard, act with a view to protecting its interests as it should have done. The distinction which it sought to make between the first defendant and the company which he was or is judicially managing in terms of the law was more of an academic exercise than it was of any substance. The best which it should have done in the circumstances of the present case was to have withdrawn its action, tendered wasted costs and reinstituted its claim(s) when leave had been granted to it to sue the first defendant. As if the damage which it occasioned to itself was not enough, it proceeded to endorse on the face of the summons that the document in question was issued and filed in terms of Form No.2 as read with r 12(1) of the rules of this court. The fact of the matter was that the summons was filed not in terms of r 12 (1) but r 113 of the High Court Rules, 1971. That aspect of the case only became apparent during the parties’ submissions. The plaintiff, in this regard, caused the court and the first defendant unwarranted work when it sought to establish its position in a round-about manner as it did. Nothing prevented it from adopting the correct and clearer rule than the procedure which it employed. The plaintiff’s submissions in regard to its claim for consequential damages were neither here nor there. Nothing prevented it from stating its claim in a clear and concise HH 371-15 HC 3780/14 manner as the rules of court demanded of it. Its persistence on the claim in the face of its vague and embarrassing tone was not amusing at all. Parties are, and should be, discouraged from couching their pleadings in vague and embarrassing terms in the vein hope that whatever defect the pleadings contain will be cured by way of a request for further particulars or further and better particulars. The party who is suing, or being sued, is entitled to know in clear and concise terms, the other party’s cause of action or his defence. The rules of court state as much and litigants are enjoined to adhere to them without fail. The rules are for the benefit of litigants who must seize every opportunity to take advantage of them and advance their cases within the ambit of the same. Chaos would have been the order of the day if the court did not have the rules as its tool of operation. The rules serve a great purpose to the court and the parties who have every reason to take their cases to court. The challenges which stood in the way of the plaintiff were self – inflicted. With some little effort on the part of the plaintiff, the challenges could easily have been avoided. The court has considered all the circumstances of this case. It is satisfied that the first defendant proved, on a balance of probabilities, his case against the plaintiff. The exception which he took was substantially properly taken. It is, accordingly, ordered as follows: (i) (ii) that the exception be and is hereby upheld that the plaintiff be and is hereby ordered to pay the costs of these proceedings. Musunga & Associates, plaintiff legal practitioners Atherstone & Cook, 1st defendant’s legal practitioners