Govera (Executor Estate Late David Govere) ans Another v NMB Bank Limited and 2 Others (309 of 2024) [2024] ZWHHC 309 (24 July 2024)

1 HH 309-24 HC 3773/23 TENDAYI JOSHUA GOVERE (Executor Estate Late David Govere DR N. O 2814/22) and VIRGINIA GOVERE versus NMB BANK LIMITED and SHERIFF OF THE HIGH COURT OF ZIMBABWE (N. O) and REGISTRAR OF DEEDS (N. O) HIGH COURT OF ZIMBABWE ZHOU J HARARE 15 May 2024 & 24 July 2024 Court application for a declaratur T Magwaliba for the applicants E Musendekwa for the 1st respondent No appearance for the 2nd and 3rd respondents ZHOU J: Introduction This is a court application for a Declaratory Order and Consequential relief made in terms of s 14 of the High Court Act [Chapter 7.06] in which the applicants seek an order couched in the following terms: 1. That the decision of the second respondent to sell late David Govere’s private property namely Number 52 Hessel Road, Borrowdale, Harare, through a skewed private treaty to an interested party be declared unlawful. 2. That the Surety Agreement relied upon to regard the late David Govere as a co- principal debtor to COLDRAC Products (Pvt) Limited and the attachment of his personal private property be declared illegal, null and void 3. That the transfer of the said property to the first respondent by the third respondent on the instruction of the second respondent be declared null and void, and alternatively HH 309-24 HC 3773/23 4. That payment made by first applicant to offset and extinguish the entire debt amounting to US$ 1 875 191.83 as per the 2010 Court Order under Case Number HC 6019/10 be upheld. AS TO THE CONSEQUENTIAL RELIEF: 5. That following the declaration of nullity, the deceased estate property being administered by the first applicant being House Number 52 Hessel Road, Borrowdale, Harare be returned and transferred back to the estate Late David Govere through the Executor Dative forthwith. 6. That first respondent pays costs of this application on an attorney and client scale if it opposes the application. The first applicant is the executor and a beneficiary of the estate of the late David Govere. The second applicant is the surviving spouse and also a beneficiary of the estate of the late David The first respondent is a banking institution incorporated in terms of the laws of Zimbabwe. The application is opposed by the first respondent. The second and third respondents did not oppose the application. The facts of this matter are as follows; on 21 September 2009, a company known as Coldrac Products (Private) Limited entered into a credit facility agreement with the first respondent. A loan of US$ 1 500 000 was advanced by the first respondent to Coldrac Products (Private) Limited as part of the credit facility agreement. A commercial stand number 436 Umtali Township, in the name of Medworth properties in Mutare was tendered as collateral for the loan advanced. David Govere, who at the material time was a director of Coldrac Products (Private) Limited, signed a suretyship agreement with the first respondent, pledging to be a surety for the loan advanced to Coldrac Products (Private) Limited. In the credit facility arrangement, it was agreed that the loan was repayable in full together with the interest thereon. However, Coldrac Products (Private) Limited failed to repay the loan in question This propelled the first respondent to take legal action against Coldrac Products (Private) Limited. A court application under HC 6019/10 was filed before this court. The matter was heard and an order under HC 6019/10 dated 26 May 2011 was granted by PATEL J (as he was then) directing the first, second, third and the sixth respondents to repay the loan. The first, second, third and sixth respondents failed to comply with the court order. This prompted the first HH 309-24 HC 3773/23 respondent in casu, to instruct the Sheriff to attach the immovable property owned by late David Govere. This instruction came after the first respondent had failed to recover its debt from Coldrac Products (Private) Limited as the company had been liquidated. The Sheriff attached stand number 52 Borrowdale Brooke Township of Brooke Estate which was owned by the late David Govere. Following this, the Sheriff then instructed Premier Real Estate to conduct a valuation report of the property to facilitate its sale. The valuation was conducted and as per the sworn in valuation certificate, the estimated value of the property under the forced sale value was US$ 180 000 while its open market value was appraised at US$ 300 000. Apparently, it is alleged by the first respondent in casu that the property was put up for sale by public auction. It is stated that it failed to attract any buyers willing to meet the forced sale value. As a result, the Sheriff decided to pursue the sale through a private treaty. On 25 April 2014, the first respondent expressed its interest in purchasing the property for US$220 000 in a letter addressed to the Sheriff. Subsequently, the Sheriff wrote a letter to all interested parties, the late David Govere included, advising the parties that the first respondent had offered to purchase the property for the sum of US$220 000. In the same letter it was communicated to the parties that the Sheriff had accepted the first respondent as the highest bidder of the property. Those who had objections were invited to file their complaints with the office of the Sheriff. The late David Govere then wrote to the Sheriff objecting the sale. He claimed that the amount offered was unreasonably low. He stated that his valuators of choice had pegged the property to the sum of US$400 000. His objection was heard and dismissed by the Sheriff. In dismissing the objection filed by the late David Govere, the Sheriff provided the parties with well-articulated reasons on how he had arrived at that decision. The Sheriff stated that the valuation report carried by the late David Govere’s estate agents of choice was not sworn to. He also highlighted that this valuation report indicated that the valuation of the property was conducted a year before the property was put up for a judicial sale. Additionally, in response to the allegations made by the late David Govere that the offered amount was unreasonably low, the Sheriff ruled that the offered amount was well above the forced sale value of US$180 000, and consequently confirmed the sale, declaring the first respondent as the highest bidder. HH 309-24 HC 3773/23 This ignited the late David Govere to file a court application under case number HC 7996/14. In that application, the late David Govere sought to set aside the decision of the Sheriff to confirm the sale on the basis that the offered amount was unreasonably low and the Sheriff had not taken into account the valuation report that he had produced which pegged the value at US$400 000. In HC 7996/14, the late David Govere also alleged that he was not notified of the sale of his property through a private treaty. This application filed by the late David Govere is still pending before this court. There were attempts by the applicants in casu, to explain why the matter was not brought to its finality. It was averred that the late David Govere was still in the process of prosecuting his matter. At once he briefed Advocate Thabani Mpofu on how the first respondent had unfairly acquired his property. He then failed to prosecute his matter as alleged by applicants as he was facing financial constraints. The applicants also claim that they also failed to bring the matter to its finality as the late David Govere erstwhile legal practitioners refused to release the file which relates to the application in question Despite filing the application in question, the Sheriff proceeded to sell the property to the first respondent for the offered amount. In 2015, the property was then transferred to the first respondent. The outstanding balance of the loan was therefore cleared by the late David Govere before his death in 2022. After his death, Tendayi Govere was appointed as the executor of his estate. An inventory was prepared and it consisted of the contested property, stand number 52 Borrowdale Brooke Township of Brooke Estate as part of the estate that was left by the late David Govere. With the belief that the property in question was unfairly acquired and it ought to be shared amongst themselves as the beneficiaries of the estate of the late David Govere, the applicants filed this application. PRELIMINARY ISSUES RAISED In opposing the matter in casu, the first respondent raised preliminary issues. The first preliminary point taken by the first respondent was that the current proceedings closely resemble pending matter under case number HC 7996/14. The first respondent claimed that the applicants had filed a similar application between the same parties and seeking the same relief as in HC 7996/14. The only difference as per the HH 309-24 HC 3773/23 first respondent’s submission, was the substitution of the late David Govere, the applicant in HC 7996/14, by the executor of his estate, Tendayi Govere. In response, the applicants opposed this preliminary point. They argued that the current application is not identical to the pending application in HC 7996/14. Moreover, in their response, the applicants stated that the late David Govere challenged the sale of the property to the first respondent in HC 77996/14, claiming that the offered amount was unreasonably low whereas in the present application, they are challenging the alleged malicious actions between the first and the second respondents in attaching, selling and transferring the property in question. Moreover, the applicants submitted that no similar application of this nature was ever brought to this court either by the late David Govere or by the applicants, themselves. What has been invoked by the first respondent in this preliminary point raised is a plea of lis pendens. Lis pendens is a defence which is open to the defendant or respondent who is being sued by the plaintiff or the applicant as the case may be. The principles which apply to the plea of lis pendens were enunciated in Diocesan Trustees, Diocese of Harare v Church of the Province of Central Africa, 2009 (2) ZLR 57 (H) at p 71. These are that: a) b) c) d) the litigation is pending; the other proceedings are between the same parties or their privies; the pending proceedings are based on the same cause of action- and the pending proceedings are in respect of the same subject-matter. Hebstein and van Winsen discuss the same defence in The Civil Practice of the High Courts and the Supreme Court of Appeal of South Africa, 5th Ed, at 605 wherein they state that: “Lis pendens is a special plea which is open to a defendant who contends that a suit between the same parties concerning a like thing and founded upon the same cause of action is pending in some other court.” In casu, it is undisputed that there is a pending matter involving the late David Govere and the first and second respondent in casu. This matter is before this court, which is a court with the jurisdiction to deal with the matter in question. The first respondent submits that both matters involve the same parties. However, it has been argued by the applicants in paragraph 4 of their answering affidavit, that the parties involved HC 7996/14 and HC 3773/14 are completely different as the applicant in HC7996/14 is now the deceased. HH 309-24 HC 3773/23 Notwithstanding, the passing of the late David Govere who was the applicant in HC 7996/14, the court is of the view that both matters involve the same parties. What has changed, is that the late David Govere has been substituted by an executor of his estate in this current application. The executor, who is the first applicant in casu has simply stepped into the shoes of the deceased. He represents the estate of the late David Govere. He sues for the benefit of the estate of the late David Govere. In filing this application, the applicants in casu, did so, on behalf of the late David Govere, who cannot represent himself now, as he is the deceased. There is in substance no difference between parties involved in these two matters. The court is therefore of the view that both proceedings involve the same parties. The court also observed that both matters are rooted in the same cause of action. The facts supporting the requested relief in the pending and the current application are identical. The subject matter in both cases is stand number 52 Borrowdale Brooke Township of Brooke Estate. The first respondent averred that relief sought is the same. The applicants are contesting that relief sought is the same. They argued that in their application, they are not seeking to set aside any order issued by any authority or legal entity. Additionally, they claimed that the current application does not challenge the Sheriff’s confirmation of the sale. They asserted that this application aims to invalidate a transaction that is allegedly born out of fraud and an illegality. The court observed that paragraph 8 of the founding affidavit and paragraph 1 of the draft order clearly indicates that what is sought to be impeached by the applicants in casu is the decision of the Sheriff to sell the contested property to the first respondent. Even though, the applicants attempted to challenge the whole transaction that resulted in the property being sold and transferred to the first respondent. The applicants failed in their attempt. Counsel for applicants, Mr. Magwaliba ended up abandoning issues to do with validity of the suretyship agreement, on which the applicants were basing their argument of the transaction leading to sale and the transfer in question being an illegality. What is clear, from papers before this court is that the applicants pray that the decision of the Sheriff to sell and transfer the property be declared a nullity on the basis that the property was sold at an unreasonably low price. The relief sought is therefore the same. The applicants submitted that the court application filed by the late David Govere under HC 7996/14 was meant to review the decision of the Sheriff in confirming the sale of the property, whereas the current application is for a declaratory order. What is sought declared a HH 309-24 HC 3773/23 nullity are the actions of the Sheriff in attaching, selling and transferring the property in question. Despite the difference in how the applicants in casu have elected to name its application, the substance of the application reveals that the pending and current application are very much similar. It is the court’s finding that the plea of lis pendens raised by the first respondent has merit. A similar matter to the present proceedings is before this court. It is still pending. It has not been withdrawn or dismissed. It is between the same parties and seeking the same relief, with the same subject matter and cause of action. It is the court’s view that litigants cannot file cases with the court and park them at court without bringing them to finality. See; Home of Angels Housing Co-operative Society Limited & 5 Ors vs City of Harare HH 800/22. It is important for litigants to make every effort to bring their matters to their logical conclusion. There must be finality in litigation: See: Allan Cimas Mpofu v (1) The Director of Customs and Excise (2) The Officer in charge, Harare Central (Fraud) SC 3/02; S v Franco & Ors 1974 (2) RLR 39 (AD). What they cannot do is to file and park process at court as the applicants did in casu. What they cannot also do is to make an effort to resurrect the same matter for the consideration of the court when previous process which they filed on the same subject-matter, between the same parties and the same cause of action remains unterminated. The applicants did not abandon HC 7996/14 for no reason. It sought to advance reasons as to why it could not prosecute HC 7996/14 in paragraph 23.9 of its founding affidavit. It claimed that the late David Govere’s erstwhile legal practitioners refused to release the files belonging to the late David Govere even after a lawful request. It was a mystery before the court, on how annexure TJG7, the first page of the founding affidavit in the pending case HC 7996/14, found its way to the current application. The applicants realized that the application filed by the late David Govere in HC 7996/14 was an application for review in terms Order 40 r 359 subrule 8 of the old High Court Rules of 1971. It knew the dangers of filing an application, and not prosecuting it within time. It sought to advance a number of defences on why the pending matter was never prosecuted. In paragraph 22 of the founding affidavit, the applicants averred that before the late David Govere’s departure he had the intention of prosecuting the matter as he had once briefed an Advocate on how his property HH 309-24 HC 3773/23 was unfairly acquired. They averred that he unfortunately could not pay the Advocate fees due to the financial constraints that he was facing. The court is of the view that if the late David Govere’s intention was to get back his immovable property the applicants in casu ought to have proceeded to prosecute the matter in HC 7996/14. Why file a new application under the disguise of an application for a declaratory order, when what sought is to review the decision of the Sheriff? The fact that the applicant in HC 7996/14 is late is not an issue at all. The law permits an executor of the deceased estate to substitute the deceased in proceedings pending before the court. The applicants looked for an alternative escape route. It filed this application for review disguised as a declaratur. Interconnected with this preliminary point is the contention that applicants are merely aggrieved by the decision of the Sheriff in confirming the sale, and are out of time allowed in terms of Order 40 r 359(8) of the former High Court Rules of 1971 to challenge such a confirmation. Therefore, this application is named a declaratur to circumvent the provisions of Order 40 r 359 (8) of the High Court Rules, 1971. The crisp issue is whether applicants’ complaints betray a review disguised as a declaratur. A review is not concerned with the merits of the decision but whether it was arrived at in an acceptable fashion. In a review the focus is on the process, and on the way in which the decision-maker came to the challenged decision. Instead of asking whether the decision was right or wrong, a court on review concerns itself with the procedural irregularities. Lord Brightman in Chief Constable of the North Wales Police v Evans [1982] 3 All ER 141 (HL) at 154d said judicial review is concerned, not with the decision, but with the decision-making process. A declaratur is provided for in section 14 of the High Court Act [Chapter 7:06]. It provides that the High Court may, in its discretion at the instance of any interested person, inquire into and determine any existing, future or contingent rights or obligations notwithstanding that such person cannot claim relief consequential upon such determination. A declaratory order is a legal remedy that can be sought when there is uncertainty or dispute over the existence of a legal right or obligation. It is used where there is a clear legal dispute or legal uncertainty regarding, for instance administrative or executive action or constitutional rights. In a declaratur a court is being asked to declare that a certain state of affairs exists. It may also be used to determine whether actual or pending action is lawful or legal. It is a simple means of curing illegal activity. With a declaratur the court gives a definitive and authoritative answer to HH 309-24 HC 3773/23 the question as to the legal position of a particular given state of affairs. See: Family Benefit Society v Commissioner for Inland Revenue 1995 (4) SA 120 (T) at 125; Garment Workers’ Union, Western Province v Industrial Registrar 1967 (4) SA 316 (T) A declaratur should not be used as procedural device to rectify irregularities in proceedings of inferior courts, quasi-judicial tribunals or administrative bodies. Instead, irregularities should be addressed through a formal review process. It is important to recognize that a review and a declarator serve different purposes and have different jurisdictional requirements. With a review one looks at the process or irregularities, while with a declaratur one is concerned with a legal position of a particular given state of affairs. Applicants call their application a declaratur. It is not what the applicants wish to call the application that matters but rather the substance of the relief claimed that is important. See Sibanda vs Chinemhute No. & Anor HH 131/14. It is not what a litigant chose to call its application that matters, the naming does not matter, the nature of the application is determined by its substance. To buttress this is the case Ex-Constable Kufa Stanley v The Commissioner General of Police & Anor where MAKONESE J enunciated that: “…. whatever name applicant chooses to give to an application, the court must unmask the nature of the application from its substance and the relief sought…” In considering whether this is declaratur proper or a review disguised as a declaratur this court looks at the substance of the application rather than what a litigant chooses to call his or her application, or its form. See: Econet (Pvt) Ltd v Minister of Information, Posts and Telecommunications 1997 (1) ZLR 342 at 344-345. The fact that an applicant seeks declaratory relief is not in itself proof that the application is not for review. Setting aside of a decision or proceeding is relief normally sought in an application for review. In casu, the fact that in paragraph 1 of the draft order, applicants ask this court to declare the decision of the Sheriff to attach, sell and transfer the contested property a nullity, is not proof that this is an application for a declaratory order. In determining the nature of the relief that is being sought by a litigant a court is bound to examine the process by which the relief being sought can be achieved. In this case, it is pertinent to note that one cannot determine the matter without subjecting the conduct of the second respondent to scrutiny in light of the provisions in Order 40 of the former High Court Rules of 1971. Such process by a judicial officer in the circumstances pertaining in this application no HH 309-24 HC 3773/23 matter what the applicants may choose to name their application is a process of review. As the basis of the application is to challenge the Sheriff’s decision a review would have been the appropriate application. The applicants in casu are seeking an order that declares the decision of the Sheriff a nullity. This decision which is sought to be impeached, is made by the Sheriff guided by the rules of this court. The ground anchoring the complaint is that the procedure of attaching, selling and transferring the property was itself irregular. It is alleged that the procedure was born out of an illegal transaction and the property should not have been attached in the first place. This places the matter within the purview of review. Issues raised by the applicants in casu of collusion between the first and second respondents are unsubstantiated. Unlike in the case Mujeyi vs Afrasia Bank Zimbabwe Limited HH 202-20 where the auctioneer and the purchaser shared the same address and the amount in which the purchaser, brought was the pegged forced sale value where it was held by MUNANGATI- MANONGWA that issue of collusion has merits, in casu, there is only a bald assertion not supported by evidence. The high watermark of the grounds of complaint and the evidence in support thereof is about the processes leading to the attachment, sale and transfer of the property in casu. Applicants are complaining about the procedure, and the grounds and evidence do not speak to a declaration of rights. The applicants are aggrieved by the decision of the Sheriff on the basis that it was arrived at via incorrect procedures. A consideration of the grounds of attack, the substance of the application and the relief sought leads to an escapable conclusion that this is a review application disguised as a declaratur. The jurisprudence in this jurisdiction is that a litigant should not be permitted to get around the requirements for review by naming its application a declaratur. See: Kwete v Africa Community Publishing and Development Trust HH 216/98 and; Ex-Constable Stanley v The Commission General of Police and Others HB 288/17; Geddes v Tawonezvi 2002(1) ZLR 479 (S). The applicants being aware of the pending review application filed by the late David Govere in HC 7996/14, sought to resurrect the same application, by filing an application for review disguised as a declaratur. Applicants launched this application approximately ten years after the decision which is sought to be impeached was made and the pending application was HH 309-24 HC 3773/23 filed. In explaining why they failed to prosecute the matter in HC7996/14, the applicants aver that David Govere’s erstwhile legal practitioners refused to release the files relating to the property in question. It was further averred that they only became aware that the property was sold and transferred to the first respondent after the death of the late David Govere. This explanation is woefully inadequate. The inventory list dated 2 September 2022, attached as annexure TJG9 portrays a different story in that after the description of property in question, there is the name of first respondent and the deed of transfer number has the correct year in which the property was transferred. This is not a coincidence, the applicants were aware that the property was sold and transferred to the first respondent. They ought to mislead the court. There is merit in the preliminary point taken that this is a review application disguised as an application for a declaratur. It is therefore the courts finding that the preliminary issues raised by the first respondent finds favour with this court. Ordinarily, lis pendens does not necessarily result in the dismissal of a matter but merely its holding in abeyance pending determination of the other matter if the court decides not to proceed to deal with the matter before it. The court has discretion as to the consequences of the upholding of the special objection of lis pendens. However, in casu because of the additional finding that the present application is a disguised application for review, it would be appropriate to dismiss the application. This course is meant to discourage parties from embracing this kind of approach to litigation. In the result, IT IS ORDERED THAT: This application be and is hereby dismissed with costs. ZHOU J……………………………………………... Ernest Gijima Attorneys at Law, applicants’ legal practitioners Musendekwa- Mtisi Legal Practitioners, first respondent legal practitioners HH 309-24 HC 3773/23