Christopher Robert Griffiths v John Rossi and Sean O'Fee and Keith O'Fee and Gary Cooper and Bakesure Marketing (Pvt) Ltd and Combined Production (Pvt) Ltd and Uppercrust Bakeries (Pvt) Ltd

HH 253-2011
                                                                               HC 2607/11


CHRISTOPHER ROBERT GRIFFITHS
versus
JOHN ROSSI
and
SEAN O’FEE
and
KEITH O’FEE
and
GARY COOPER
and
BAKESURE MARKERTING (PVT) LTD
and
COMBINED PRODUCTION (PVT) LTD
and
UPPERCRUST BAKERIES (PVT) LTD



HIGH COURT OF ZIMBABWE
GOWORA J
HARARE, 18 March and 1 April 2011


Urgent Chamber Application


Ms M.V. Chizodza-Chineunye, for applicant
N. Madya, for respondents

       GOWORA J: This is an urgent application in which the applicant seeks a
provisional order. In the interim relief the applicant prays, firstly, for an order that the
respondents be interdicted from removing from Zimbabwe a blending machine, allegedly
in storage at Beitbridge border post, and in addition thereto an order for the return of that
machine to the fifth respondent with a corresponding order for the payment of storage
costs by the respondents in respect of the machine in question. In addition the applicant
again in terms of interim relief seeks an anti-dissipatory interdict in respect of various
assets allegedly belonging to the fifth, sixth or seventh respondents.
       In respect of the final relief, the applicant seeks an order for the rendering of
audited accounts from fifth, sixth, and seventh respondents by 5 May 2011. He also seeks
an order directing the respondents to convene a board meeting on or before 15 th May and
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a shareholders meeting on or before 22 nd May 2011. An anti-dissipatory interdict is
sought in final terms as well as costs against all the respondents.
       Mr Madya has raised a number of points in limine which I should determine
before hearing the parties on the merits.
       It was argued on behalf of the respondents that the applicant lacks the necessary
locus standi in judicco to bring these proceedings. It was contended that the applicant is
seeking to bring before the court a derivative action available to shareholders in a
company, and which action is based on a complaint that the majority in a company have
acted in a manner contrary to the interests of the company or shareholders and that the
shareholders in control of the company are not willing to redress the wrong.
       In the founding affidavit, the applicant has averred that he is a director and
shareholder in the fifth, sixth and seventh respondents. He has not attached any CR 14
forms from the office of the Registrar of Companies to prove that he is a director of these
companies. It seems to be accepted in the opposing affidavit that he is at least a director
in two of the companies. It is denied that he is a shareholder in any of the companies.
       He has however attached a shareholders agreement in respect of Caperow
Investments (Pvt) Ltd. According to the respondents, this company changed its name by
Special resolution and is now called Combined Production (Pvt) Ltd, the sixth respondent
herein. The applicant and his legal practitioner were aware of the fact that the company
had changed its name but did not find it necessary to inform the court in order to establish
the linkage between Caperow and the sixth respondent and the shareholders’ agreement
in respect of Caperow and the applicant. One gets the impression that the papers were
prepared in a hurry with scant attention to detail.
       The respondent has also produced a shareholders agreement in respect of
Cronaville Investments (Pvt) Ltd which also changed its name by special resolution to
Bakesure Marketing (Pvt) Ltd, which is the fifth respondent herein. If there is a
shareholders’ agreement in respect of the seventh respondent it has not been produced by
any of the parties.
       An examination of the two shareholders agreements reveals that the applicant’s
name only appears therein as a representative of Yallop Investments (Pvt) Ltd. The
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respondents contend that the shareholding in the fifth and sixth respondents that the
applicant is claiming is that of Yallop Investments (Pvt) Ltd in which the applicant has
an interest.
        By claiming to be a shareholder the applicant is misleading the court. More
importantly, however, he appears unable to distinguish between Yallop Investments and
himself. He produced a shareholder’s agreement in which the company, not himself, is
the shareholder in the sixth respondent and even after the respondents had mounted a
vigorous and spirited opposition to the application and denied that the applicant was a
shareholder he persisted, when even on the documents produced by him, he is not a
shareholder.
        It is trite that a company is a distinct legal person from its members and
irrespective of what interest the applicant has in Yallop Investments, it is a separate legal
entity from himself. It is the shareholder in the fifth and sixth respondents and I hold
therefore that the applicant lacks the necessary locus standi to institute these proceedings.
        In addition Mr Madya, relying on clause 13.1 of the agreements has argued that
the parties specifically agreed that in the event of a dispute the matter should be referred
to arbitration. It was argued further that the applicant has not chosen to take the court into
his confidence and explain why he decided not to refer the matter to arbitration and
instead felt compelled to bring the matter to court.
        Although Mrs Chizodza-Chinounye sought to argue that the applicant had in e-
mails made requests for financial statements which were not forthcoming, it would seem
to me that that would not be a reasonable explanation by the applicant to elect to come to
court instead of referring the matter to arbitration. It was also clear that this was an
explanation coming from the bar and that the applicant had himself not given an
explanation for the election.
        Where a contract contains an arbitration clause for the resolution of disputes or a
disagreement the law is clear that the clause is binding on the parties to the agreement
and none of the parties is at liberty to revoke this clause at any time that party wishes to
do so. In the absence of an explanation from the applicant it is my view that this is a
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matter in which the parties would be best served by referring the dispute or disagreement
to an arbitration as that is what was agreed upon
       If this was the only preliminary point raised I would have had to stay the
proceedings until such time as the applicant would have sought redress in terms of the
agreement. In view of the fact that his point is part of a number of other issues raised I
will therefore decline jurisdiction in this matter until such time as the applicant has
sought resolution in terms of the parties’ agreement.
       Finally, Mr Madya contended that the matter was not urgent. As the basis for
claiming urgency the applicant has averred that the parties to the agreement have not held
any meetings since 2008. By not raising the issue in 2009 and 2010, it seems that
applicant was quite happy for the companies to be run without the input of directors of
which he is one, at a meeting. He sat back and did nothing. Ironically a meeting had been
scheduled at the precise time at which I had set this matter down for hearing before me.
He chose not to attend and said so emphatically. He had also claimed that he had just
become aware that assets in the two companies were being disposed off clandestinely.
The respondents have produced e-mails to the applicant and from himself in which the
disposal of a T35 vehicle, which is one of the items he complains was disposed of
clandestinely, is debated. The e-mails also debate the question of purchasing vehicles and
go as far back as December 2009. I find his allegation that he has only become aware of
the disposal of vehicles recently completely untruthful and not supported by the
documents produced by the parties. In my view the matter is not urgent.
       The respondents have contended that the applicant must be ordered to pay costs
on the punitive scale. The point is made that the applicant, in full knowledge of the issues
raised by him dragged the respondents to court when it was absolutely unnecessary.
Indeed the record seems to point to an effort on the second respondent for the parties to
resolve their differences over a meeting. The applicant clearly was not in mood to
entertain these moves, his attitude being that the parties would meet in court. He clearly
states in an e-mail that there would e no meeting and that there would be correspondence
from his lawyers. If he wished the court to order the holding of a meeting, why did he
choose not to attend a scheduled meeting for the parties to discuss whatever may have
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been the cause of the disagreement between the parties. There is also an indication on the
papers that although the parties had agreed to meet in January he kept stalling on the
issue on the pretext that his lawyer was not in the country. He has also not been truthful
on a number of issues and it is my view that he has abused court process.


       In the premises I would uphold the points in limine and dismiss the application.
The applicant is ordered to pay the costs of the application on the higher scale.




M.V. Chizodza-Chineunye, applicant’s legal practitioners
Wintertons, 1st – 6th respondents’ legal practitioners