First Mutual Microfinance (Private) Limited v Damson Zuwa & Ors

### Preamble
First Mutual Microfinance [Pvt] Ltd v Damson Zuwa & Ors
1
HH 610-23
HCHC 159-23
FIRST MUTUAL MICROFINANCE [PVT] LTD
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FIRST MUTUAL MICROFINANCE [PVT] LTD
versus
DAMSON ZUWA
and
THE REGISTRAR OF DEEDS
and
THE DEPUTY SHERIFF-HARARE

HIGH COURT OF ZIMBABWE
MAFUSIRE J
HARARE, 18 October 2023

Date of judgment: 9 November 2023

Opposed application

P. Takawadiyi-Musarurwa, for the applicant
First respondent in person
No appearance for the second and third respondents

MAFUSIRE J

[1] The applicant filed a court application claiming payment by the first respondent of the sum of US$20 000-00, together with interest and costs. This was money lent and advanced by the applicant to the first respondent in terms of a written agreement of loan signed by the parties on 17 August 2022. The first respondent opposed the application. After reading the documents filed of record and hearing argument from both sides, I granted the order sought. My reasons were announced ex tempore. The first respondent has appealed. I have been asked to provide the written reasons for my order. By all means.

[2] Despite the applicant’s apparent sloppy drafting – for example, citing the Registrar of Deeds unnecessarily as the first respondent, citing some defunct entity or person called the Deputy Sheriff-Harare, as second respondent, and then in the body of the application, claiming relief against all three respondents jointly and severally – the claim was classically unassailable, and the purported defence classically bogus. Here is why.


[3] The applicant is a registered financial institution. It granted the first respondent [hereafter referred to as the respondent] a loan facility in terms of the written agreement aforesaid. The amount was US$20 000-00. Loan charges in the form of an establishment fee, insurance, bank charges and tax, for which the first respondent would be liable, would all be levied on, and deducted from, the loan amount. The net loan balance was US$18 550-00. The material terms of the loan agreement were:

- interest at 7% per month over twelve months from 9 September 2022,
- repayments through bank deposits at prescribed rates of instalments over twelve months from 9 September 2022 to 9 August 2023,
- a penalty rate of interest at 6% per month for any overdue instalment,
- all amounts outstanding becoming due and immediately payable in the event of a default,
- collateral security in the form of a mortgage bond over the first respondent’s immovable property known as Stand 5624 Ruwa Township, measuring 2000m² and held under Deed of Transfer No 485/2005,
- liability for all the costs incurred in the event of legal action for the repayment of the loan.

[4] The loan amount was disbursed on 2 September 2022. Mortgage Bond No 1852/2022 was duly registered over the respondent’s property aforesaid. The respondent did not pay back the loan in terms of the agreement, or at all. On 2 March 2023 the applicant filed the present application. Before that, it had engaged the respondent, both by telephone and in writing, imploring her to repay the loan. She did not. The applicant’s prayer was this:

- repayment of the loan amount in the sum of US$20 000-00,
- interest on the loan amount at 7% per month from 9 September 2023,
- default interest from 9 September 2023 at 6%, not per month as per the contract, but per annum – probably another example of sloppy drafting but which worked out in favour of the respondent anyway,
- a declaration that the mortgaged property be executable, and
- costs of suit on the attorney and client scale.

[5] The respondent’s grounds of opposition were manifestly a ploy to buy time and an abuse of the court process. She neither disputed any of the applicant’s material averments nor took issue with any of the material terms of the loan contract itself. She admitted her default. Her major objection was that each time she communicated her financial difficulties to the applicant she would be granted more time to pay.

[6] The one aspect that the respondent raised in her papers and stressed with some degree of passion at the hearing was that the loan amount was not disbursed to her on the signing of the loan agreement. She claimed that by reason of that fact she was promised that the repayment schedule would be reconsidered to commence in October 2022 and that the interest accruing on the loan would not be reckoned from 2 September 2022 as this was not the first day the repayment would start. She did not say by who the promise was made or by when the interest would start running. She confirmed though that the loan amount had been disbursed on 2 September 2023. On the question of costs, she claimed that these should be on the ordinary scale and not the attorney and client scale, allegedly because she had informed the applicant of her parlous financial situation.

[7] The respondent’s allegations above run counter to the express terms of the loan agreement and the factual averments in the applicant’s papers. For example, interest on the loan amount was claimed from the date of disbursement, 2 September 2022. This was consistent with the agreement and the law. Costs on the attorney and client scale in the event of legal action for the recovery of the loan was what the parties agreed upon, not the ordinary scale.

[8] The substance of the respondent’s “opposition” was to force the applicant to give her another payment plan thereby buying more time for herself. None of what she said amounted to a defence at law. Courts have no power to re-write an agreement for the parties. They have no power to craft new terms for them. All they do is to enforce the agreement between the parties if all else is legitimate. This is an elementary principle of the law of contract that requires no citation of cases.

[9] The respondent drafted her papers and presented her argument as a self-actor. Plainly, she was so ill-informed or ill-advised or both. Her submissions during the hearing were basically a plea for clemency. She said she was a single mother trying to find her feet in a harsh financial environment. Sadly for her, the court’s hands are tied. But curiously, the loan was not for domestic consumption. It was purely for a business venture. It was for the acquisition of capital machinery for a commercial mining enterprise. She was into gold production or trade. An actor in commerce must play by the rules.

[10] There being no defence proffered by the respondent which the court could interrogate, I granted an order in terms of the draft. Unfortunately, the final order missed the portion on default interest at 6% per annum from 9 September 2022. But for the appeal, I would have been correcting the order in terms of r 29 of the High Court Rules, 2021. The final order issued read as follows:

i/ The first respondent shall pay the applicant the sum of USD20 000-00 together with interest thereon at the rate of 7% per month from 2 September 2022 to the date of payment.

ii/ The immovable property situate in the district of Salisbury being Stand 5624 Ruwa Township of Dispute Estate held under Deed of Transfer 485 of 2005 is hereby declared specially executable and may be sold by private treaty with the third respondent being hereby authorised and empowered to execute any such documents as may be required to give effect to this order.

iii/ The first respondent shall pay the costs of suit on an attorney and client scale.

Chiwunda-Mujokoro & P. Takawadiyi, applicant’s legal practitioners
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