DISTRIBUTABLE (91)
Judgment
No S.C. 92\2002
Civil
Appeal No 121\2000
H.E.M.
GRANITE INDUSTRIES (PRIVATE) LIMITED v (1)
GUISEPPE CARLO DAL COL (2) STONE ENTERPRISES
(PRIVATE) LIMITED
SUPREME
COURT OF ZIMBABWE
EBRAHIM JA,
SANDURA JA & CHEDA JA
HARARE
MARCH 7 & NOVEMBER 19, 2002
E.T.
Matinenga, for the
appellant
F.
Girach, for the
respondent
CHEDA
JA: The appellant issued summons against the respondents
claiming certain sums of money for damages arising from quarry
stone
that was allegedly removed from its claims by the respondents.
The claims
were framed as follows in the amended declaration:-
Payment
of US$218 000,00 per month minus production costs, against both
respondents being damages for patrimonial loss suffered
by the
appellant from September, 1997 to the date on which respondents
vacate appellants claims.
Alternatively
payment of the sum of US$218 000,00 minus production costs per month
for patrimonial loss suffered by appellant from
May 1998 to the date
when respondents vacate appellants claims; against both
respondents, jointly and severally the one paying
the others to be
absolved.
The respondents disputed the
claims and the matter went to trial.
The trial
court held that the appellant had failed to prove its claim for
damages and ordered absolution from the instance.
The appellant
now appeals against this decision.
The
declaration of the appellant gave the following as the basis for the
claim:-
The plaintiff is the
registered owner of a granite claim in the Mutawatawa area of Mutoko.
Boma Granite Company (hereinafter referred
to as Boma), entered
into a tribute agreement with the plaintiff to mine granite on the
claim. Boma later pulled out of the site
and left some blocks of
granite stone. The defendants were subsequently found to be mining
granite on the site without the authority
of either the plaintiff or
Boma.
When asked to leave, defendants
first argued that they had authority to mine on the site, but later
left following the intervention
of the Mining Commissioner.
The plaintiff is claiming damages
of US$218 000,00 per month being patrimonial loss arising from the
granite that was unlawfully removed
by the defendants.
At the trial, Messrs Mupezeni,
Ngombe and Nhunge gave evidence for the plaintiff, now appellant.
Mupezeni said he is a director
of the appellant company. The
appellant entered into a tribute agreement with Boma. Boma mined
the claims for some time but stopped
before the end of the agreement
period. However, they continued to look after the claims up to the
end of the tribute period.
He learnt that the first respondent was
interested in entering into a tribute with the appellant. Mupezeni
wanted to consult his
son in South Africa over the matter. The
first respondent did not enter into any tribute with the appellant.
Mupezeni said
Boma would pay them for granite actually removed and sold. The
appellant would get a royalty of 10% of the sold blocks,
and payment
ranged from $30 000,00 to about $280 000,00 per month.
When a letter was written to the
first respondent to leave the site he first argued that he owned the
site legally and had certificates
to that effect. An inspection was
carried out by the Mining Commissioner and it was established that
the respondents were, in fact,
mining on the appellants claims.
The first
respondent said the error on the pegging misled him. However, the
pegging had been done by his own agent. He cannot
be excused for
the error of his own agent. It was up to him to employ a competent
person to do the pegging for him. His agent,
one Phiri, was
apparently not a qualified person. The evidence of the Mining
Commissioner confirms that indeed the respondents
were running on the
claim known as Shamba 10. Shamba 10 is, in fact, one of the
appellants claims. Following the trial, the
parties filed a
document by consent dated 28 March 2000, in which they agreed as
follows:-
Plaintiff
and Defendant hereby close
their respective cases and record agreement on the following issues
arising out of Defendants production schedules. The
agreement
between the parties set out hereunder supersedes (sic) anything to
the contrary set out in the production schedules placed
before the
Honourable Court.
Defendants
produced a total of
994,674 cubic metres
of black granite from their working on Shamba 10.
Defendants
exported a total of
661.17 cubic metres
of black granite at an anticipated profit of US$95 per cubic metre.
The
exports are recorded on invoice numbers 201, 226, 213 and 212 dated
16 December 1997, 28th
July 1998 (x2) and
18th
May 1998 (x2) respectively.
The
quarry price per cubic metre, reflecting the different qualities of
the granite is US$320, US$380, US$425, US$320, US$425 respectively.
Defendants
expected profit was US$62 811,15.
The main grounds for appeal were
that:-
(1)
The learned judge erred, having found that Respondents wrongfully
removed black granite from Appellants
mining claims, erred in finding that the loss by Appellant had not
been proven in circumstances where:
the
quantity of black granite removed was agreed at 994.674 cubic
metres.
the
First Respondents evidence of the at quarry value, i.e. US$100
per cubic metre of black granite was accepted by Appellant.
clause
4 of the tribute agreement upon which Appellant based its loss
provided for a royalty amount of 10% of the at quarry value
of the
blocks of granite.
The
learned judge erred in finding, by implication, that the profit
realised from the sale of the black granite was relevant to
the
calculation of the loss suffered by Plaintiff, in circumstances
where such loss is based on at quarry value.
I agree with the appellant that
there was sufficient evidence to show that granite had been removed
from the appellants claims.
They quarry was removed without
authority. Clearly this resulted in some loss to the appellant.
The respondent submitted that
the appellant had not shown that it was
going to get someone who could mine the quarry and pay the same price
as the appellant could
not mine the quarry and had no means to do so.
This is besides the point. It cannot be said that there was
absolutely no other
person or company that could be interested in the
quarry despite its alleged poor quality.
The agreement
on the quantity of the granite removed clearly establishes the loss.
What the appellant did not prove was the exact
figure or value of
the loss.
I would not agree with the
appellant that the amount he calculated on the basis of the at quarry
value.
I do not consider that it would
be correct to use that valuation because according to the appellants
evidence they were paid a
royalty of 10% based on the stones actually
removed and sold. Even the appellant in its averment to the summons
was claiming a
certain amount less production costs. If the
production costs are to be deducted then what is left is the profit.
No production
cost figures are given. In view of that, the only
reliable and ascertainable figure is that of US$95 which is agreed by
the parties
as profit.
In my view the
matter should have been resolved by calculating 10% of US$95
multiplied by the number of cubic metres agreed as exported
because
that represents the number which we are sure was sold.
The production costs have already
been taken into account if the $95 is said to be profit. The fact
that the appellant was claiming
a figure less production costs
indicates that the appellant was interested mainly in the profit that
the respondents were going to
get.
The respondents argued that the
figures on the summons were pure speculation. I have decided not to
rely on those figures but on
the agreed figures on the document
signed by the parties.
The fact that the respondents had
not been paid or might not be paid for some of the granite is the
respondents own business risk
and cannot be a defence to the
appellants claim.
Part of the respondents
argument was that it was unlikely that the respondents would have
entered into a tribute agreement similar
to that of Boma in view of
the loss made by Boma. On the other hand if the respondents were
aware of Bomas reasons for abandoning
the tribute then they should
never have started working the claim.
To argue that the stone was
valueless is not quite correct. We have it on record that the
respondents had been paid for some of
the stones and were still
discussing payment on the other consignments.
On the issue of establishing
damages, Mr Girach
referred to the case of Appliance
Repairs and Maintenance Services (Private) Limited v Little
1973 (2) RLR 318, where it was held that a court will only resort to
attempting an estimate of damages where it is clear that some
damage
has in fact been suffered and that the party claiming damages has led
all the evidence which it was possible for him to lead.
He
submitted that in this case the appellant had not led all the
evidence.
In this case there is no doubt
that the removal of the appellants granite stones has resulted in
him suffering damages.
We know this because someone has
previously mined the granite and sold it then paid the appellant
large sums of money by way of royalties.
It follows that any other person
who got interested in mining the quarry would have to pay some money
to the appellant.
In the Appliance
Repairs and Maintenance
case, supra,
reference was made to the case of Hensman
v Shapiro & Co
1926 TPD 367 wherein LEWIS JA stated:-
In
that case, however, it was stressed that the court will only resort
to doing its best in making an estimate of damages where it
is quite
clear that some damage has in fact been suffered and that the party
claiming the damages has led all the evidence which
it was possible
for him to lead.
In
these circumstances, the fact that the plaintiff has been unable to
lead evidence which would enable the court to arrive at an
exact
assessment of damages does not preclude the court from doing its best
and making an estimate on what material is available
where he clearly
has suffered some damage.
In
this case the appellant led all the evidence to show that it had
suffered damages. What was left was the formula of calculation,
or
how to arrive at and establish the exact damages suffered.
However,
the material to rely on is available on the document that the parties
agreed on. It is the number of cubic metres produced,
the number of
cubic metres exported and the expected profit on each cubic metre.
The figures are given in the
document referred to earlier.
In
my view these figures are the material that the court should have
used. The other figures cannot be relied on because, for example,
the
cost of production is not given and cannot be easily established.
Although the number of cubic metres produced is given it
is not known
what happened to the rest if only 661,17 were exported. The most
easily ascertainable figures in the circumstances
are the expected
cubic metres and the expected profit.
In
order to arrive at a proper assessment I would multiply the number of
cubic metres exported by the sum given as profit for each
cubic metre
then award the appellant 10% of that figure as damages in the form of
the royalties it would have been paid.
661,17 x
US$95 = 62 811, 15 US$
10%
of 62 811,15 = US$6 281, 15
The
above calculation is, in my view, more appropriate as it is based on
figures that are certain.
Accordingly
I make the following order:
The appeal succeeds to the extent
that the trial courts order is set aside and substituted by the
following:
The
defendants are ordered to pay the plaintiff, jointly and severally,
the one paying the other to be absolved, the sum of US$6
281 (to the
nearest) or its equivalent in local currency; and
interest
at the prescribed rate from the date of judgment;
costs
of suit.
EBRAHIM
JA: I agree
SANDURA
JA: I agree
Gutu
& Chikowero,
appellant's legal practitioners
Byron
Venturas & Partners,
respondents legal practitioners
