Remigio Mavata v George Pedzisayi Fichani Family Trust and George Pedzisayi Fichani

### Preamble
1
HB 118/19
HC 1984/15
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REMIGIO MAVATA

Versus

GEORGE PEDZISAYI FICHANI FAMILY TRUST

And

GEORGE PEDZISAYI FICHANI

IN THE HIGH COURT OF ZIMBABWE

TAKUVA J

BULAWAYO 17 JULY 2019 & 8 AUGUST 2019

Civil Trial

Chigomere and V. Mutatu for plaintiff

I.  Murambatsvina for the defendants

TAKUVA J:	This is a dispute involving the sale of mining claims.  Plaintiff believed that he was entering into a very good deal with the 1st defendant being represented by the 2nd defendant.  In actual fact, it turned out to be a very bad deal for him.  The drama unfolded on 15 January 2007 when plaintiff and 1st defendant entered into a written agreement of sale in respect of four (4) gold mining claims being Gazemba 105 to 108, Copper Queen under Gweru Mining District.

The material terms of the agreement were as follows:

That the seller (plaintiff herein) sold to the purchaser (1st defendant herein) the mining claims for the sum of P100 000,00 (one hundred thousand Botswana Pula) or equivalent in Zimbabwe Dollars).

The mining claims were sold as a unit.

The 1st defendant was to pay P100 000,00 or equivalent in Zimbabwe Dollars by 28 February 2007.

The plaintiff acknowledged receiving a deposit of P20 000 on 15 January 2007 and 1st defendant took vacant possession of the mining claims on the date of signing the agreement of sale.

Transfer was to be effected after the 1st defendant paid the purchase price in full.

The 1st defendant breached the agreement by failing to pay the balance of P80 000,00 (Eighty Thousand Botswana Pula) or equivalent Zimbabwe Dollars by the 25th February 2007.  On the 20th March 2007, without the consent of the plaintiff, 2nd defendant fraudulently transferred the mining claims being Gazemba 105 – 108 from plaintiff’s names into his names.  Despite demand to rectify both the breach of contract and the fraudulent change of ownership of the mining claims, the defendants have refused, failed or neglected to do so.

Plaintiff finally issued summons against both rdefendants on 24 July 2015 claiming for an order that;

“1.	Transfer of mining claims Gazemba 105 to 108, Copper Queen under Gweru mining district dated 20 March 2007 into 2nd defendant’s name be and is hereby set aside.

2.	The Provincial Mining Director, Gweru be and is hereby authorized to transfer the mining claims Gazemba 105 to 108, into the names of plaintiff.

3.	The defendants jointly and severally pay the costs of suit on an attorney and client scale.”

Both defendants filed their plea claiming to have paid Z$20 000 000,00 on 23 November 2006 whose equivalent was P80 000,00.  They also claimed to have paid Z$450 000 000,00 which was an equivalent of P80 000,00 on 26th February 2008.  These two payments were alleged to have been made into a CABS Gold Class Kwekwe Account number 9050240539 whose account holder is N. Mavata, plaintiff’s wife.

As regards the alleged unlawful transfer of ownership, defendants contended that transfer was properly done by plaintiff and defendants’ agent one Jotham Khomani in Gweru.  Second defendant averred that the contract  entered into by him and the plaintiff is perfecta.

At the close of pleadings the parties filed a joint pre-trial conference memorandum with the following issues;

“(a)	Whether or not the 1st defendant breached the agreement of sale dated 15 January 2007.

(b)	Whether or not the defendants fraudulently transferred mining claims Gazemba 105 – 108, Copper Queen under Gweru mining district to 2nd defendant.

(c) 	Whether or not by the operation of the prescriptive prescription, plaintiff’s claim should not be dismissed.

(d)	Whether or not plaintiff’s failure to cite the Mining Commissioner for Gweru Mining District is a material mis-joinder.”

The onus was placed on the plaintiff on issues (a) and (b) and on the defendants on issues (c) and (d).

The plaintiff’s evidence is that he entered into an agreement with the 1st defendant represented by the 2nd defendant on 15 January 2007.  The agreement was reduced to writing.  Before he sold the mine, he had allowed a syndicate called Four Brothers to work on it.  He later discovered that the 2nd defendant had joined this syndicate and was working with it to harvest gold.  Due to the fact that the 2nd defendant was already familiar with the premises he did not find it necessary to show him the boundary.  The full purchase price was supposed to be paid by 28 February 2017 but defendant’s failed to pay.  Plaintiff then addressed a letter to 2nd defendant on 6 June 2007 reminding him of the breach.  The 2nd defendant acknowledged receipt of the letter on 18 June 2007.  He also acknowledged that he had breached the agreement by failing to pay on or before the 28. February 2007.  The 2nd defendant gave various reasons for the failure to comply with the agreement.  Plaintiff produced the agreement as exhibit A3 and the cheque for P20 000,00 as exhibit A4.  At the end of June 2007 plaintiff approached the Mines Office at Gweru where he discovered that the claims were now registered in 2nd defendant’s name.  This surprised him since he as the registered owner had not authorized that transfer.  He referred to exhibit A5 on page 11 of his bundle of documents and denied categorically that he signed that document as he was in Botswana on the date that it was signed namely the 20th of March 2007.  He attached a page of his passport as proof that he entered Zimbabwe on 27 February 2007 and exited on the 4th of March 2007. The passport page was produced as exhibit A6.

The plaintiff was convinced that the transfer was fraudulent because of the following reasons:

His signature is a forgery;

The reason for the transfer of ownership was indicated as “free” when in actual fact he had sold the claims to the 1st defendant.

The claims were registered in the 2nd defendant’s name when the agreement of sale was between plaintiff and 1st defendant.

Plaintiff does not know anyone by the name Jotham Khomani;

In any event the certificate does not show that plaintiff was represented by an agent.

When advised that the defendants claim to have paid the full purchase price between 2006 and 2008, plaintiff outlined the payments as follows:

A payment of Z$2 million equivalent to P80 000,00 made in 2006 was made in accordance with an agreement between plaintiff and Four Brothers.  It had nothing to do with the agreement in dispute.

A payment of Z$450 million on 26 February 2008 equivalent to P80 000,00 was only discovered by plaintiff in 2013 after the police had informed him that the 2nd defendant was claiming to have paid in 2008.  Plaintiff emphasised that this payment was made well after the due date in terms of the agreement i.e. 28 February 2007.

Because defendants did not advise him of the payment, the value was wiped out by inflation as it was during the hyper inflationary period.

Plaintiff was aggrieved by the unlawful transfer of his claims to the 2nd defendant and he lodged a complaint with the Zimbabwe Republic Police in 2007.  An investigating officer was assigned but by the time of his death in 2010 no meaningful progress had been noted.  In 2013, plaintiff made a follow up and was advised to lodge a report afresh which he did.  Another Investigating Officer Detective Sergeant Kavhiya was assigned to investigate but he was transferred before finalizing investigations. Up to the time of the hearing the matter had not been referred to trial.

Dissatisfied with the conduct of police officers, plaintiff lodged a complaint with the Mines Office in Gweru through a letter dated 11 October 2013 addressed to the Mining Commissioner, Midlands Province.  The Mining Commissioner acknowledged receipt of the letter and promised to investigate, but again no progress was made.  Plaintiff then approached his legal practitioners of record for assistance in 2014.  According to the witness, the Z$450 million was deposited into his wife’s bank account which had been given to Four Brothers during the tenure of their agreement with plaintiff.  The defendants were supposed to pay the balance in cash by the 28th February 2007.

Under cross examination the witness insisted that the Z$2 million paid in 2006 was paid by the 2nd defendant on behalf of “Four Brothers” since he was their “sponsor”.  He denied that the money was meant to be the deposit for his claims arguing that at that stage i.e. December 2006 he had not yet sold his mine.  He vehemently denied authorising the transfer of his claims personally or through his wife.  He insisted that no one benefitted from the Z$45 million as it was wiped by the bank due to hyper inflation existing at that time.  Plaintiff closed his case.

In my view, plaintiff was a truthful witness.  Most of his evidence is corroborated by the agreement of sale and in some respects by the 2nd defendant.  It was accepted by the 2nd defendant that the claims which were registered in plaintiff’s name were transferred to 2nd defendant’s name in the absence of the former.

The defendants opened their case by calling George Pedzisayi Fichani (the 2nd defendant) to give viva voce evidence.  The witness agreed that he started sponsoring “Four Brothers” in October 2006.  When he discovered that “Four Brothers” were not the owners he contacted plaintiff’s wife and eventually contacted plaintiff.  It was then agreed that he pays a “commitment deposit” of Z$2 million which was part of the purchase price.  He did so through an RTGS into a CBZ bank account on 23 November 2006.  In December 2006, plaintiff came and showed him the beacons for Gazemba 108 only.  The two then met in Bulawayo on 14 January 2007 and proceeded to Botswana where the agreement of sale was crafted and 2nd defendant paid a deposited of P2 000,00 from his FNB account.  According to him, the November 23 payment was not included because he had not brought with him the copy of the RTGS document.  During the drafting of the agreement, 2nd defendant said he insisted on the inclusion of the plaintiff’s wife since she was the “contact person” in Zimbabwe.  Plaintiff agreed that payments be made into his wife’s account.

To his knowledge, Khomani was cleared by the CID Officers so was Marufu from the Mines Office.  According to what he was told by Khomani, the transfer was authorized by plaintiff’s wife who acted as plaintiff’s agent.

In my view, 2nd defendant’s evidence is unsatisfactory.  His explanation relating to the so-called “commitment deposit” of Z$2 million is an after-thought in that it runs contrary to the rest of his evidence on how and when payment was made.  Equally unconvincing and false is why 2nd defendant had ownership transferred in plaintiff’s absence.  He did not call Khomani to give evidence on circumstances surrounding the transfer.    More importantly, 2nd defendant had the transfer processed not in accordance with the provisions of the agreement but contrary to it.  I take the view that the 2nd defendant is not being truthful on these aspects of his evidence.

Findings of fact

That the plaintiff  and the 1st defendant represented by the 2nd defendant entered into an agreement of sale in respect of four (4) mining claims being Gazemba 105 – 108 Copper Queen,

That the purchase price was P100 000,00 or its equivalent in Zimbabwe dollars at the time.

That the agreement was drafted by the 2nd defendant’s legal practitioners.  Upon signing the agreement on 15 January 2007 the 2nd defendant paid P20 000,00 as deposit and plaintiff acknowledged receipt of the same amount.  The 1st defendant then took vacant possession of the mine.

That the 1st defendant was required in terms of clause 1 of the agreement to pay the full purchase price on or before the 28th February 2007.  The 1st defendant failed to pay by that date.

That ownership of the claims was transferred by the 2nd defendant fraudulently and contrary to clause 4.1 of the agreement.  The 2nd defendant had ownership vested in him personally on 20 March 2007.

That in June 2007, defendants in black and white admitted that they had breached the agreement by failing to pay the balance of the purchase price.

That plaintiff immediately upon realising that there had been a fraudulent change of his mine’s ownership reported the matter to the police in Gweru.  However, no meaningful progress occurred until he made a follow-up in 2014 when he was informed that the scope of the investigations needed to include an official from the Ministry of Mines who facilitated the fraudulent transfer of the mining claims.

The plaintiff also lodged a complaint with the Ministry of Mines in Gweru.

That 2nd defendant clandestinely deposited an amount of Z$450 million on 26 February 2008 into plaintiff’s wife’s bank account.  This was almost a year after the breach of the agreement.

The Law

When a contract is reduced to writing, the document is in general regarded as the exclusive memorial of the transaction and in a suit between the parties, no evidence to prove its terms may be given, save the document.  See Nhundu vs Chiota & Anor 2007 (2) ZLR 163 (S); Johnson v Lear 1980 (3) SA 927.

Put differently, the principle is that where an agreement has been reduced to writing, no extrinsic evidence may be given of other utterances of oral acts by the parties which will have the effect of contradicting, altering, adding to, or varying the written contract.  In casu, the parties intended in terms of clause 10 of the agreement, that the contract be the exclusive document governing their agreement.

The clause states:

“10.	 The terms of this agreement shall  constitute the entire contract between the parties and no previous or contemporaneous communication, representation or agreement (whether oral or in writing, made or alleged) to have been made by either of the parties shall vary or add to the terms of this agreement and no variation of this agreement made or alleged to have been made subsequent to the execution thereof, shall be of any force or effect unless reduced to writing and signed by or  on behalf of the parties.”

As regards prescription it is beyond doubt that the plaintiff filed a criminal complaint against the 2nd defendant.  He waited for the police and Ministry to finalise their investigations.  In terms of s23 of the Criminal Procedure and Evidence Act Chapter 7:07 a criminal offence remains valid for 20 years.  In any event prescription starts running from the time when all the facts are known to the litigant.  See Peebles v Dairiboard Zimbabwe (Pvt) Ltd 1996 (1) ZLR 4 (H).

In terms of section 275 (1) of the Mines and Minerals Act (Chapter 21:05), whenever there occurs such a sale, the Provincial Mining Director shall be notified.  The section states:

“275.	Registration or Transfer of mining locations and transfer duty payable

When any registered mining location or any interest therein is sold or otherwise alienated in whatsoever, the seller or person who so alienates shall notify the Mining Commissioner of the transaction sixty days of the date of such transaction, and shall inform him of the name of the person to whom such location or interest is sold or otherwise alienated and of the amount of the valuable consideration if any and the date of the transaction.”

Subsections (2) and (5) of the same section require that duty be payable by the purchaser six months from the sale or other alienation of the mining location as the case may be.  It is a fundamental principle of our law that a thing done contrary to the direct prohibition of the law is void and of no force and effect.  See Chirosva Minerals (Pvt) Ltd v Minister of Mines & Ors 2011 (2) ZLR 403.

Application of the law to the facts

In respect of the 1st issue, the 1st defendant’s assertion that 2nd defendant paid Z$2 million in November 2006 as a commitment deposit is an after-thought in that clause 1 of the agreement which was agreed to much later does not mention that figure.  Instead, it refers to P20 000,00 as the deposit.  The 2nd defendant’s submission that he did not include this figure in the agreement because he had left the RTGS in Zimbabwe is clearly untrue and laughable, especially when one considers the fact that the agreement of sale was drafted by his legal practitioner.

Further, any shadow of doubt regarding defendants’ breach was extinguished by 1st defendant’s letter dated 18 June 2007 wherein they acknowledged their breach of contract.  The letter that was authored by the 2nd defendant states in part:

“…

We advise that we could not meet the 28 February deadline and this was extended to Easter.  From then, I have been in court in and out.

(b)	We are ready with your payment but we want you to satisfy clause 6 of the agreement of sale.  “The seller shall erect beacons clearly identifying her claim boundaries”.  Once that is done you can have your money …  Also remember the agreement was drawn by my legal advisors so I know what I was signing and I understand it fully.

What we want are good relations with you not legal battles … (The emphasis is mine)

Two further points should be noted from this correspondence.  Firstly, the 2nd defendant is pleading to be allowed to exercise his option in terms of the agreement to pay the balance in Zimbabwe dollars.  Implicitly, this means that the purchase price had not yet been fully paid as at June 2007.  To remove any doubt he proceeded to quantify the amount as Z$184 500 000,00 (Z$184,5 million).

Secondly, despite being fully aware that he had a couple of months earlier, transferred ownership into his name, he does not say a word about this to the plaintiff. This is strange to say the least.  The million dollar question is if 2nd defendant knew as at 18 June 2007 that he had fully paid for the four claims, why did he not simply say so in clear and unambiguous language.  He should have said to the plaintiff: “Look my friend I have already paid the full purchase price and in terms of clause 4.1 of our agreement I have since taken transfer of ownership on 20 March 2007.”  Why did 2nd defendant conceal these crucial pieces of information from the plaintiff?  The answers are obvious.  Firstly, he knew that he had not fully paid the purchase price.  Secondly, he knew that he had fraudulently transferred ownership in contravention of clause 4.1 of the agreement.

As regards the second issue, I have no doubt that transfer of the mine’s ownership was done fraudulently by the defendants and their agent one Khomani.  The 2nd defendant however remained the chief architect of this fraud, obviously being aided and abetted by corrupt officials in the Ministry of Mines at the Gweru office.  Otherwise, how does one explain this clear violation of the provisions of the Mines and Minerals Act.  In terms of clause 4.1 of the agreement, transfer was supposed to be done upon payment in full of the purchase price.  Payment in full was supposed to be done by the 28th February 2007.  However, by 18 June 2007, when 1st defendant acknowledged breach of contract, transfer had already been effected .on the 24th March 2007 before payment in full.

Neither the plaintiff nor 2nd defendant as the representative of 1st defendant or in his own right attended at the Ministry of Mines for the purpose of effecting transfer.  In addition, the claims were sold for P100 000,00 or equivalent but on both the certificate of transferor and transferee, consideration is shown as “free” which is a clear fraudulent misrepresentation.

Consequently, since the transfer of title was done before the payment in full of the purchase price, it follows that the whole process was a nullity and was also in breach of the parties’ written agreement.  In my view, there was no way the plaintiff was going to consent to the transfer of the title whilst he had not received the full purchase price as per the written agreement.  Prescription does not apply in casu in that from June 2007, the plaintiff has been enforcing his rights in one form or the other.  By 2015 the plaintiff realised that the routes of the ZRP and Ministry of Mines were barren, he took the matter with this court timeously.

The transfer was clearly void for want of compliance with section 275 of the Act.  It was fraudulent as the defendant sought to evade his liability to pay tax.  Defendants’ argument that plaintiff’s failure to cite the Mining Commissioner for the Midlands is a material mis-joinder is flawed.  In terms of Order 13 Rule 87, no cause or matter shall be defeated by reason of mis-joinder on non-joinder of any party and the court may in any cause or matter determine the issues or questions in dispute in so far as they affect the rights and interests of the persons who are parties to the cause.  In casu, the dispute is between the parties cited.

On the evidence, I am satisfied that the plaintiff managed to discharge the onus on a balance of probabilities in respect of the first two issues.  On the other hand the defendants have failed to discharge the onus cast upon them in respect of the third and fourth issues.

Accordingly, it is ordered that:

The transfer of mining claims Gazemba 105 to 108, Copper Queen under Gweru Mining District dated 20 March 2007 into 2nd defendant’s name, be and is hereby set aside.

The Provincial Mining Director, Gweru be and is hereby authorized to transfer the mining claims Gazemba 105 to 108 into the names of the plaintiff.

The defendants jointly and severally pay the costs of suit.

Mutatu & Partners c/o Dube-Tachiona & Tsvangirrai plaintiff’s legal practitioners

Messrs Murambatsvina, Tizirai-Chapwanya c/o Lazarus & Sarif defendants’ legal practitioners