Dharmesh Bhikha and Himmettlal Parshotam Bhikha and Laxmiben Himmettlal Bhikha and Ilesh Bhikha v Phillip Ndlovu in his capacity as Final Judicial Manager of H. Bhikha Enterprises (Pvt) Ltd and The Master of the High Court and H. Bhikha Enterprises (Pvt) Ltd (Under a Final Judicial Management Order) and Pintail Trading (Pvt) Ltd

### Preamble
1
HB 14/21
HC 13/21
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DHARMESH BHIKHA

And

HIMMETTLAL PARSHOTAM BHIKHA

And

LAXMIBEN HIMMETTLAL BHIKHA

And

ILESH BHIKHA

Versus

PHILLIP NDLOVU

In his capacity as Final Judicial Manager of

H. BHIKHA ENTERPRISES (PVT) LTD

And

THE MASTER OF THE HIGH COURT

And

H. BHIKHA ENTERPRISES (PVT) LTD

(Under a Final Judicial Management Order)

And

PINTAIL TRADING (PVT) LTD

HIGH COURT OF ZIMBABWE

KABASA J

BULAWAYO 31 JANUARY 2021

Urgent Chamber Application

N Sithole, for the applicants

G Nyoni, for the 1st and 3rd respondent

P Ncube, for the 4th respondent

KABASA J:		This application was filed on 27th January 2021.  Due to the measures put in place in terms of Practice Direction 2/2021 I advised the parties that I intended to dispose of the matter on the papers.  I instructed the applicants to serve the application on the respondents who were to file their opposing papers by 29th January if they were so inclined.

The first, third and fourth respondents duly filed their opposing papers, paving way for me to proceed to determine the matter.

The background facts are these: - In 2017 the third respondent fell into financial problems resulting in the Directors seeking voluntary judicial management.

On 24th January 2018 a Provisional Judicial Management order was granted under case number HC 3343/17.  The 1st respondent was subsequently appointed as the Judicial Manager.

On 19th July 2018 the Provisional Judicial Management order was confirmed.

Before the provisional judicial management order was granted, the 4th respondent, being one of the 3rd respondent’s creditors entered into a contract with the 3rd respondent duly represented by the first applicant.  The 4th respondent was to supply goods to the 3rd respondent which the 3rd respondent was to sell on terms agreed between the 2 parties.  The contract was signed in 2018; details of the day and month were unfortunately omitted.  It was an express term of the contract that:-

“…the Agreement will subsist until the application for Judicial Management is finalized.”

Following the confirmation of the Provisional Judicial Management order, the 1st respondent entered into a Memorandum of Agreement with the 4th respondent in which it was acknowledged that the 3rd respondent was incapacitated to stock its shops and that the 4th respondent had been supplying goods to the 3rd respondent as far back as January 2018.  In the Agreement signed on 31st December 2020 the 4th respondent agreed to continue supplying goods to the 3rd respondent.  This was couched as follows:-

“And whereas the supplier is prepared to supply the Receiver with the necessary stocks as it can absorb per the terms and conditions set hereunder and particularly to assist the Receiver become profitable again, pay its debts and come out of Judicial Management.”

It follows from the foregoing that the 2018 Agreement between the 3rd and 4th respondent was therefore entered into before the 3rd respondent was placed under Judicial Management.  The 2020 Agreement was entered into after the Provisional Judicial Management order was confirmed and the 1st respondent signed it as the representative of the 3rd respondent.

This background is necessary in order to put the issues in their proper perspective.

In the Urgent Chamber Application the applicants, who are the Directors who were divested of their power to run the affairs of the 3rd respondent when 3rd respondent was placed under Judicial Management seek the following interim relief:-

“That the 4th respondent be interdicted from acting upon a contract that was illegally entered into by and between the 3rd respondent and itself in or about the 2nd of January 2018 pending the return date of this application.”

The Certificate of Urgency filed in support of the Urgent Application avers that:-

“1.	This Honourable Court placed the 3rd respondent under Final Judicial Management Order sometime in 2018.

2.	The 1st respondent was appointed the Final Judicial manager of the respondent

3.	1st respondent was thereby vested with the charge of running of the 3rd respondent.

4.	Contrary to his duties imposed on him by law, 1st respondent did not act when he realised 3rd and 4th respondents had illegally entered into a contract behind his back.

5.	This is because 3rd respondent having been placed under a Final Judicial Management Order lost any contractual capacity thereby.

6.	Instead of acting on this apparent illegality, it appears 1st respondent has gone ahead or blessed this illegality as he also is now a beneficiary of same.

7.

8.	Monies are being pillaged from 3rd respondent company, harvested by both a party to the illegality, the 4th respondent and 1st respondent.

9.

10.	This matter is urgent as it speaks to a harm that is continuing arising from a contravention of the law.”

The contract being referred to as illegal can only be the 2018 contract.  That being the case, when did the need to act arise?  The answer to this question speaks to the issue of urgency.

The 1st, 3rd and 4th respondents took issue with the issue of urgency.  They contend that the matter is not urgent and ought not to be allowed to jump the queue.

This judgment is concerned with this preliminary point.  Is this matter urgent?

In Kuvarega v Registrar-General and Another 1998 (1) ZLR 188, CHATIKOBO J had this to say on urgency:-

“What constitutes urgency is not only the imminent arrival of the day of reckoning.  A matter is also urgent if at the time the need to act arises, the matter cannot wait.  Urgency which stems from deliberate or careless abstention from action until the deadline draws near is not the type of urgency contemplated by the rules.  If there has been any delay, the Certificate of Urgency or supporting affidavit must contain an explanation of the non timeous action.”

In casu the 2018 contract whose legality is being questioned and upon which the Urgent Application is premised “ran its course” and a new contract was signed on 31st December 2020.  No issue has been taken regarding the 2020 contract.

The 1st applicant is the one who signed the 2018 contract and that contract is said to have been signed on or about 2nd January 2018.  That contract clearly acknowledged that it was signed before the 3rd respondent was placed under Judicial Management.

When did the 1st applicant realise that the January 2018 contract was illegal?  Since he is the one who signed it duly authorized by virtue of a resolution of the Board of Directors and the Board comprises of the 2nd – 4th applicants, why has it taken all of 3 years to seek to impugn the contract?

In Documents Support Centre P/L v Mapuvire 2006 (2) ZLR 240 at 244 C-D MAKARAU JP (as she then was) had this to say:-

“… Urgent Applications are those where if the court fail to act, the applicant may well be within their rights to dismissively suggests to the court that it should not bother to act subsequently as the position would have become irreversible and irreversibly so to the prejudice of the applicant.”

Only an applicant who acted with haste when the need to so act arose can be able to say this.  The applicants in casu talk of a 2018 contract and that there is need to arrest the harm created by this contract and which harm is continuing.  That contract no longer exists, there is a new contract signed by the Judicial Manager which is now in place.

Whatever harm, if there was any, has come and gone as there is no 2018 contract to talk about.

A matter is not urgent because a party failed to act when he was expected to but decides to act after the event because of a perceived “continuing harm.”

In Gwarada v Johnson 2009 (2) ZLR 159 the court had this to say:-

“Urgency arises when an event occurs which requires contemporaneous resolution, the absence of which would cause extreme prejudice to the applicant.  The applicant must exhibit urgency in the manner in which he has reacted to the event or threat.”

Have the applicants in casu reacted in a manner that exhibits urgency?  I think not.  There is absolutely no exhibition of urgency in a matter that is premised on an event that occurred in 2018.

It is not even clear what prejudice is being suffered to justify having the matter jump the queue.  Whilst I do not intend to go into the merits of the matter, I cannot help but acknowledge the fact that the 1st respondent intends to finalise the accounts and financials for 2020 and a meeting is scheduled to be held after the lockdown measures imposed to address the COVID 19 pandemic. That meeting and the presentation of the accounts showing how the 3rd respondent is faring should address any issues any interested party may have concerning the well being or otherwise of the 3rd respondent.

Factually the urgency is also premised on a misrepresentation of the facts.  The January 2018 contract was signed before the appointment of the 1st respondent as a Judicial Manager.  The 1st applicant had not yet been divested of power to deal with the affairs of the 3rd respondent.  There was therefore no illegality in the contract, which was concluded between 3rd respondent as represented by 1st applicant duly authorized by 2nd – 4th applicants and the 4th respondent.

There is nothing to suggest that the contract concluded on 31st December 2020 between the Judicial Manager who is the 1st respondent and the 4th respondent is tainted with illegality.

The Provisional Order itself also speaks volumes as to the lack of urgency.  This court is being asked to interdict enforcement of a contract entered into in or about 2nd January 2018, a contract which is to all intents and purposes non-existent in light of the new 31st December 2020 contract.

I do not intend to unduly exercise my mind on any other issue besides the issue of urgency.  This application falls on this first hurdle.

The respondents have asked for punitive costs.  Punitive costs show the court’s displeasure and are meant to censure the party who has courted the court’s displeasure.

I am of the considered view that this application was a waste of time and ought not to have been filed.  It has caused the respondents to incur unnecessary costs in defending it.

Punitive costs are therefore called for and the respondents have made a case justifying the award of such costs.

That said, I make the following order:-

1.	The matter is not urgent and is accordingly removed from the roll of urgent matters.

2.	The applicants are to pay costs at attorney-client scale and are jointly and severally so liable, the one paying the others to be absolved.

Ncube Attorneys, applicants’ legal practitioners

Moyo & Nyoni, 1st and 3rd respondent’s legal practitioners

Coghlan and Welsh, 4th respondent’s legal practitioners