Judgment
No. SC 12/07
Civil
Appeal No. 21/05
(1)
NATIONAL EXECUTOR AND TRUST (PRIVATE) LIMITED
(2) HOLLAND AND REDFERN (PRIVATE)
LIMITED (3)
REGISTRAR OF DEEDS BULAWAYO v ROSEMARY
SINGINI
SUPREME
COURT OF ZIMBABWE
SANDURA
JA, CHEDA JA, & ZIYAMBI JA
HARARE,
FEBRUARY 19 & DECEMBER 21, 2007
R M
Fitches, for the first and second appellants
No
appearance for the third appellant
H Zhou, for the respondent
ZIYAMBI JA: In the High Court the respondent (Mrs Singini)
obtained an order interdicting the first, second and third
respondents from concluding an agreement of sale over stand number 16
Kingsdale Avenue, Queensdale, Bulawayo (the property),
with a
third party, and the fourth respondent from effecting transfer of the
property in the event that the first three respondents
have already
concluded an agreement with a third party. This appeal is against
that order.
The appellants maintain, in the main, that no prima facie
right had been established and that the learned Judge erred in
confirming the provisional order.
The respondent is the widow of the late Singini Zamani who was a
lessee of the property known as 16 Kingsdale Avenue, Bulawayo
(the
property). She is also the Executor of the estate of the late
Singini Zamani. The property now forms part of the estate
of the
late Francois De Lange and is being administered by a director of the
first appellant.
These proceedings were commenced by Singini Zamani (Singini)
who deposed to the founding and answering affidavits.
Singini averred that upon the death of De Lange, the first
appellant (the Trust) wrote advising him that the property
was for sale and that he was to liaise with the second appellant
(Holland & Redfern) if he wished to purchase it. He
was
offered the right of first refusal by virtue of his status as sitting
tenant on the property. In April 2002, Holland &
Redfern invited
him to make an offer, which he did in the sum of Z$2 600 000.00.
However, that offer was felt to be too low
and Singini was told that
Holland & Redfern would look for better offers but would give him
the opportunity to match the highest
offer if he was still desirous
of purchasing the property. In that event, he would be required to
pay 10% of the purchase price
as a deposit, whereupon an agreement of
sale would be drawn up, after the conclusion of which Singini would
be required to pay
cash or come up with a loan urgently.
On 3 July 2002 Singini was telephoned by S Meikle on behalf of the
Trust enquiring whether he could match an offer of Z$3 million.
Singini confirmed that he could.
On 5 July 2002, one Mukono acting on behalf of Holland &
Redfern, telephoned to advise that he had received an offer of Z$3
million.
Singini again confirmed that he would match the offer and
Mukono then advised him to attend at Holland & Redferns
offices
to sign the necessary agreement of sale and arrange for
payment of the purchase price. He was advised that it would take a
few
days before the agreement of sale would be ready for signature.
He asked Mukono to put in writing the request that he match the
offer
of Z$3 million.
The written confirmation came in the form of a letter dated 9 July
2002, from the first appellant and signed by Mrs S M Meikle.
The
letter reads in relevant part:
As you are aware we have now received an offer of $3 000 000.00
cash for the property you are renting. unless you are able to
match
this offer with a similar cash offer, we regret that your offer of $2
6000 000.00 is not acceptable to us. Please be guided
accordingly.
We are aware that Mr D Mukono of Holland & Redfern has advised
you of the offer received....
Thereafter, although he made it clear to Mukono that he needed the
agreement of sale so that he could process payment, his
frantic efforts to hasten the drawing up of the agreement of sale by
making telephone calls to the respondents proved fruitless.
On 15
July 2002, he wrote to the Trust indicating his willingness to
purchase the property at Z$3 million. The relevant part
of the
letter reads:
Your letter dated 9 July refers.
I confirm that the required amount of $3 000 000.00 per offer for the
property is acceptable to me. May an agreement of sale be
made so
that I can access my funds.
On the same date, he visited Holland & Redferns offices and
was told by Mukono that payment of the sum of Z$3 000 000.00
was
required, in cash, by 4.30pm that day or else the property would be
sold to other cash buyers. He protested the unreasonableness
of this
request and reiterated that he needed the agreement for sale in order
to access funds for payment of the purchase price.
Thereafter,
further attempts to obtain the agreement of sale from the appellants
having proved fruitless, he referred the matter
to his legal
practitioners who also attempted to obtain an agreement of sale from
the appellants to no avail.
It was not disputed by the appellants that Singini was granted a
right of first refusal in respect of the purchase of the property
or
that Singini was told by the Trust that in the event he was able to
match the highest offer he would be required to pay a deposit
of 10%
upon signature of an agreement of sale. Indeed, the letter from the
Trust dated 17 April 2002 set the terms quite clearly.
Paragraph 3 -
4 of the letter reads:
We are aware that you have made an offer for $2 600 000.00.
However, this has not been accepted to date. As you will appreciate
as Executors it is in the interest of our clients that we obtain the
highest possible price for the property and we cannot just
accept the
first offer received. If a higher offer is received for the property
you having made the first offer will have the
option to match the new
offer received.
Please ensure that you have sufficient funds on hand to deposit 10%
of the sale price with the Estate Agents on signing of any
documents.
We as Executors would also require a letter of guarantee from the
company granting you mortgage loan facilities if
the full offer was
not to be a cash offer...
Mr Fitches on behalf of the appellants, contended that the
respondent was put on terms and, having failed to abide by them, the
court a quo
had erred in confirming the provisional order for an
interdict when the respondent had not established a prima facie
right entitling her to an interdict.
However, it seems the appellants have put the cart before the horse.
In terms of the letter of 17 April 2002, quoted above, Singini
was to
have available a sum equivalent to 10% of the purchase price and to
pay such sum upon signature of any documents. Thereafter
he had the
option of paying cash or providing the appellants with a letter of
guarantee from the company offering him mortgage
facilities. No
deadline was set in that letter and it was therefore incumbent on
Singini to respond within a reasonable time.
It was not the
appellants contention that Singini had not responded within a
reasonable time to that letter. (Indeed the learned
Judge found that
he had responded within a reasonable time). What the appellants say
they did amounted to ignoring the letter
and setting new terms. Thus
they demanded payment in cash of the sum of Z$3 000 000 when the
initial payment ought to have been
Z$300 000. They set a deadline,
the date of which is disputed and they provided no agreement for
signature despite being requested
to do so and despite the provision
in the letter that the deposit should be paid upon signature of
documents; despite also the
fact that they must have known that the
respondent would require the agreement of sale in order to source
funds for the balance
of the purchase price. (They anticipated that
he might be applying for a loan hence the reference in the letter to
a letter
of guarantee).
I therefore do not agree with Mr Fitches that no prima
facie right was established. The respondent had a right of first
refusal and was denied the right to exercise it in the manner
provided
in the letter to him by the appellants. The learned Judge
found as follows:
Their conduct with all respect was mala fide. It has to be
understood in that context in light of the fact that they had already
accepted an offer from a Mr Ncube.
Whatever reason they had for changing their minds, they cannot be
allowed to do so because a valid contract had already been concluded
with applicant. Mr Bowes ignored applicants letter of 15 July 2002
and also that of applicants legal practitioner of 17 July
2002.
He has not endeavored to explain away his behaviour and in the
absence of any explanation I can only attribute this behaviour
to
either sheer ignorance of a simple office procedure of acknowledging
correspondence or stubbornness. Unfortunately whatever
reason it was
does not help him as he is indeed liable for this problem.
As I state above all the three respondents were working together in
this matter and it is their conduct which resulted in frustrating
applicant. In my view, applicant has performed his part of the
contract by exercising his right of refusal and also by matching
the
offer of $3 million within a reasonable time. Having so done he was
entitled to specific performance by first, second and
third
respondents jointly and severally. Entitlement to specific
performance was ably state by INNES J in Farmers Co-op Society
v Berry AD 343 at 350.
Prima facie every party to a binding agreement who is ready
to carry out his own obligation under it has a right to demand from
the other party.
So far as it is possible, a performance of his
undertaking in terms of the contract. As remarked by KOTZE CJ in
Thompson v Pullinger
(10R at p 301). the right of a plaintiff to
the specific performance of a contract where the defendant is in a
position to do
so is beyond all doubt. It is true that courts
will exercise discretion in determining whether or not decrees of
specific performance
should be made. They will not of course be
issued where it is impossible for the defendant to comply with them
Applicant has proved on a balance of probabilities that
respondents owe him a duty to perform that part of their bargain.
See also Patel v Greek Films (Private) Limited 1973 (1)
RLR 180 at 181 G-H.
I find no fault with the above reasoning.
Accordingly, it is my view that the order granted by the court a
quo was correct and the appeal is without merit.
The appeal is therefore dismissed with costs.
SANDURA JA: I agree
CHEDA JA: I agree
Wintertons, first and second appellants legal practitioners
Gill, Godlonton & Gerrans, respondents legal
practitioners
