BRANSON MARKETING (PRIVATE) LIMITED

versus

NATIONAL BLANKETS LIMITED

HIGH COURT OF ZIMBABWE

KUDYA J

HARARE, 4 and 17 February 2010

Opposed application

L Uriri,for the applicant

E Morris, for the respondent

KUDYA J:      This is an application for execution pending appeal arising from my judgment of 7 November 2007 in which I ordered National Blankets Limited to pay Branson Marketing (Pvt) Limited the sum of ZAR 720 607-07 and interest a tempore morae at the rate applicable in South Africa from the date of the service of summons to the date of payment in full plus costs of suit. It was filed on 2 July and opposed on 17 July 2008.

The principles applicable for leave to appeal pending appeal were succinctly set out by SMITH J in Econet vTelecel Zimbabwe (Pvt)Ltd 1998 (1) ZLR 149 (H) at 154F. The learned judge stated thus:

“In determining an application for leave to execute pending an appeal, the court must have regard to the “preponderance of equities'', the prospects of success on the part of the appellant and whether the appeal has been noted without “the bona fide intention of seeking to reverse the judgment but for some indirect purpose e.g. to gain time or to harass the other party''. See Fox & Carney (Pvt)Ltd v Carthew-Gabriel (2) 1977 (4) SA 970 (R) and ZDECO (Pvt)Ltd vCommercial Careers College (1980)(Pvt) Ltd 199l (2) ZLR 61 (H).”

Mr Uriri, for the applicant, submitted that the notice of appeal was filed not to reverse the judgment but in order to delay execution of the judgment. He contended that while the notice of appeal was filed in the Supreme Court on 27 November 2007, it was not served on the Registrar of the High Court until two years later on 26 January 2010. He further contended that the respondent did not, as required by Part V r 34(1) of the Supreme Court Rules, within five days of filing the notice of appeal, tender or undertake to pay the Registrar’s costs for the preparation of the record of appeal.

Reference to the original court record appealed against showed that the Registrar of the High Court was served with the notice of appeal on 10 December 2007. It further revealed that the respondent’s legal practitioners undertook to pay for the costs of the preparation of the record on appeal on 10 December 2007. The first two grounds contended by Mr Uriri, thus, fall away. The third point that he raised was that the respondent did not comply with the requirements of r 46 (5) of the Supreme Court Rules as it did not furnish security for the applicant’s costs of appeal within one month of filing the notice of appeal or at any time thereafter. It is correct that the respondent did not furnish security for the applicant’s costs of appeal but r 46 (2) of the same rules prescribes that such security shall be furnished before the appellant lodges copies of the record with the Registrar. It seems to me that the respondent’s failure to furnish security within one month may have been cured by the present application, which if granted dispenses with such a tender. 

The fourth ground raised by Mr Uriri to show that the respondent’s appeal was noted with mala fide intention was that the respondent did not pay the amount of R327 527-46 which forms part of the total judgment debt ordered on 7 November 2007, notwithstanding that it admits indebtedness in this lesser amount. Mr Morris, for the respondent failed to counter the fourth ground raised by the applicant’s counsel. Standing on its own, the failure to satisfy the amount it admits owing is demonstrative of the fact that the respondent noted its appeal solely for the purpose of delay.

On the preponderance of equities the applicant contended that the payment has been outstanding since 2004 and the long delay has deprived it of the use of these funds to fulfill its obligations. Mr Morris submitted that the balance of convenience was evenly balanced. It seems to me that the applicant has been prejudiced of the utilization of those funds for which indebtedness is admitted. However as money is involved the payment of interest in the currency of account would tend to offset the prejudice by compensating the applicant for the loss in the time value of money. I am thus satisfied that the balance of convenience is fairly evenly balanced.

 Mr Uriri submitted that the respondent had no prospects of success on appeal. He contended that I made findings of fact which the appeal court would not lightly interfere with. One of these findings was that the respondent had contracted, as principal, with the applicant in the purchase of the raw materials to the value of ZAR 353 199-47. The value of the materials was not in dispute. The respondent’s defence was that the applicant executed the contracts of sale with Cyriel (Pvt) Ltd and Stakeholders (Pvt) Ltd who in turn sold the goods to it. I found from the evidence led and especially from the documentary exhibits that Cyriel and Stakeholders were agents of the respondent. That the respondent was the principal was demonstrated by the fact that the respondent placed the orders to the applicant, requested the purchase price of the materials from the applicant, selected the transporters of the purchases and received the materials unopened by either Cyriel or Stakeholders. I found from the contents of exh(s) 1 and 2 (letters written by the deponent to the respondent’s opposing affidavit and its sole witness at the trial) that it was common cause that these two entities were used by the respondent to overcome the complications arising from stringent central bank regulations on accessing foreign currency on the auction system. It was agreed that the respondent introduced the applicant to these two entities. My finding was that the two entities were mere smokescreens of the respondent. The respondent did not adduce any evidence to show that it purchased the raw materials from either Cyriel or Stakeholders. It was also agreed that when Cyriel failed to pay the amount due to the applicant in foreign currency, the local currency held by it was returned to the respondent. The end result was that the respondent received the raw materials from the applicant while the applicant did not receive any value for the consignment. The thrust of my judgment was that it was in a bid to get value that the applicant sought the help of the respondent to receive payment from the respondent’s agent. My finding was that the exhibits that contained these requests and the investigation mounted by the applicant showed that the applicant looked up to the respondent for payment.

It does not appear to me that those findings might be upset on appeal. They are firmly grounded on the bedrock of the evidence adduced during trial.

Mr Morris based his submission that the Supreme Court may overturn my findings mainly on the basis of the contravention of s 4 (1) (a) (i) of the Exchange Control Regulations SI 109 of 1996. He fell into the error of giving evidence on the manner in which the auction system of foreign currency operated in his heads of argument. This was not adduced during trial or in the respondent’s opposing affidavit. It was grounded in speculation. He speculated that payment was to be made outside Zimbabwe. There was no evidence to dispute that payment would be made in Zimbabwe. The respondent’s submissions that are based on the Exchange Control regulations are misplaced for two reasons. Firstly, they are based on speculation and secondly they seek to attack comments that I made after I had already determined the matter on the facts and on issues that were fully ventilated during trial. The comments I made mero motu on the possible application of the exchange control regulations and the par delictum rule were raised without affording counsel the opportunity to present argument were orbiter dictum. They were not the ratio decidendi of my judgment. Raising them in the present matter at the eleventh hour is further proof that the respondent is hard pressed to attack the judgment granted in favour of the applicant on the basis of the evidence adduced during trial.

I am satisfied that the appeal lodged by the respondent does not have prospects of success and was merely noted for the mala fide purpose of delaying payment to the applicant.

Accordingly, it is ordered that:

1. The applicant be and is hereby granted leave to execute upon the judgment of this Honourable court in Branson Marketing (Private) Limited v National Blankets Limited handed down on 7 November 2007 under case number HC 4807/06 pending appeal.

1. The applicant shall prior to executing upon the judgment deposit with and to the satisfaction of the Registrar of the High Court a bond of security de restituendo.

1. The respondent shall pay the costs of this application.

Ahmed & Ziyambi, applicant’s legal practitioners

Majoko & Majoko,respondent’s legal practitioners