Peter Ndlovu versus Twalumba Holdings

### Preamble
1
HH 182-2013
HC 6642/11
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PETER NDLOVU

versus

TWALUMBA HOLDINGS

HIGH COURT OF ZIMBABWE

DUBE J

HARARE, 13 January 2013 and 4 February 2013

Trial Action

H Nkomo, for the plaintiff

P Makuwaza, for the defendant

DUBE J:  What began as a noble endeavour to give back to the community by developing the world’s most beautiful game, soccer, has turned sour.

On 8 January 2011, the parties entered into a Memorandum of Agreement (MOA) the purpose of which was to “establish a formal partnership between Twalumba and Ndlovu in playing and developing soccer” .The arrangement was for Twalumba to use part of its profits to empower Zimbabweans through information, knowledge and skills development and sharing. Twalumba was desirous of establishing a vibrant team and a soccer academy targeting young people in Binga. The plaintiff as a renowned soccer player would use his expertise to play, develop the game in Zimbabwe and inspire the growth of Highfield United Football Club.

The financial terms of the MOA were as follows:

That Twalumba would-

“5.2.	Let Ndlovu use his personal vehicle. Twalumba will provide fuel and the vehicle maintenance.

5.3	Twalumba undertakes to pay Ndlovu a monthly allowance of $2 500-00 (Two thousand, five hundred dollars) per month.

5.4	Ndlovu undertakes to expand all his skills and knowledge playing soccer.

5.5	Twalumba will pay US$55 000-00 (fifty five thousand dollars) as signing on fees for Ndlovu instead of cash payment, Twalumba will buy a house of the above value for Ndlovu in Harare…..”

After having played about five friendly games at Highfield United FC, the plaintiff was loaned to Black Mambas FC on a season’s free loan. On 1 July 2011 the defendant terminated the MOA on the basis of breach of contract. In a letter addressed to the plaintiff, the defendant chronicles the basis of cancellation of the MOA as being that the defendant has not realised any benefit from associating with the plaintiff. Secondly, that the plaintiff failed to organise a testimonial match as agreed. Further that he conducted himself improperly by missing training sessions, using improper and abusive language towards the technical staff and bringing pictures of nude girls to training.

The plaintiff claims payment of the sum of US$55 000-00 as sign on fees. The plaintiff asserts that when he appended his signature to the agreement he became entitled to the payment of the amount as signing on fees. The plaintiff further asserts that the defendant breached the agreement by failing to honour his promise to buy him a house in terms of clause 5.5 of the MOA.

The defendant refutes that the plaintiff had a soccer or football playing contract with Highfield United entitling him to signing on fees. It insists that he was a partner of Twalumba and was not entitled to signing on fees. The defendant contends that the plaintiff did not co-operate with the defendant in establishing a formal partnership in terms of the Memorandum of Agreement and that no mutual benefit materialised from it. The defendant further asserts that the plaintiff refused to sign a football contract. That the plaintiff’s claim if granted, will result in unjust enrichment to the plaintiff as the monies claimed are not due to him.

The plaintiff testified as follows. He started playing soccer at the age of 10 at Highlanders FC. He later joined the senior team in 1989 where he played for 11 years. He played for the National team and has over 100 caps. In 1990 he joined Coventry City and later played for Birmingham City, Huddersfield Town Football Club, Mameledi Sundowns and Tanda Zulu Royal in South Africa. When he joined all these clubs, he would sign football contracts with the clubs. Signing on fees would be paid on signing the contract or immediately after signing. Signing on fees are paid as soon as a player puts his signature to the contract. He signed an agreement with the defendant to play for Highfield Football Club. The defendant promised him US$55 000-00 as signing on fees and he preferred that they buy him a house of that value. The signing on fees were due to him immediately when he put his signature on the document. He did not get the signing on fees.

Although he was contracted by the owner of Twalumba, he had a football contract to play for Highfield Football Club. On 4 March 2011 he signed an agreement to be loaned to Black Mambas Football Club. He together with three others was going to be loaned to the club because they were premiership class. They were on a season’s free loan for the 2011 season. During that season, he played about five to six friendly games for Highfield. He played close to fifteen to twenty games for Black Mambas who were in the premiership league. Whilst he was at Mambas, his wages were being paid by Highfield F.C or Twalumba Holdings until they terminated the contract in July 2011. The witness denied that he ever played truant. There was a time he went to Namibia to play for a Global United event which is a charitable event to do with Global warming. The other time he was away after he had gone to consult his doctor in South Africa after an injury. Mr Sibanda, the owner of Twalumba, the defendant, was always aware of his absence. All communication regarding the Namibia event was send to Twalumba and Zifa. Twalumba cleared him. The witness denied being given any other football contract to sign or consider. The witness gave his evidence in a clear and straightforward manner. He remained consistent with his version of events.

The plaintiff called Winston Makamure in support of his case. The witness holds a player/agent licence from Zifa. He was the plaintiff’s football agent from the year 1993 to 2007. He negotiated contracts for a number of players internationally. He negotiated the plaintiff’s contract with Coventry City Football Club in England. An agent represents either a club or a player. A player either gets into a contract with a club or an organisation. He defined sign on fees as fees that are paid immediately after the player signs a contract. They are simply sign on fees. If a player breaks his leg after signing a contract that money is still due to the player. He added that sign on fees are a commitment fee or token for signing on. The parties can agree to stagger the payments. Once you sign a football contract, you cannot join another club without the consent of the club you are contracted to. Upon signing the  contract, the money agreed to becomes due to the player. He testified that an organisation or owner of a club can have a contract with a player and the player will still be entitled to sign on fees. He has previously negotiated international contracts were players entered into contracts with owners of clubs. He gave the example of Kennedy Nagoli who signed a contract with the owner of a football club when he joined a club in the Czech Republic.  The witness helped shed light into the definition of sign on fees. He gave his evidence in a straight forward manner. He impressed the court with his knowledge of football contracts. He gave his evidence well.

The defence opened its case by calling Dr Nkululeko Sibanda. He is a major shareholder at Twalumba. The defendant has a franchise in Highfield United Football Club. The club is now known as Twalumba Football Club. Both he and the plaintiff come from Binga. When the plaintiff left Mamelodi Sundowns in South Africa he went into retirement. The witness persuaded him to come out of retirement. The two entered into a Memorandum of Agreement. The objective was to prepare groundwork for a football contract the club was going to sign with the plaintiff. He gave him a copy of the contract which he said he wanted to show to his brother Marko who was his manager. He also wanted to consult other family members. The plaintiff took away the contract before signing it and did not bring it back. The witness does not have a copy of the contract.

He testified that clause 5.5 which provides that the plaintiff would be paid US$55 000-00 or a house was supposed to be included in the football contract that the plaintiff was supposed to sign. That football contract was supposed to be used to register the plaintiff as a player for Highfield United Football Club with the ZIFA Northern Region. The witness maintained that the Memorandum of Agreement was a pre-nuptial agreement and was a forerunner to the football contract the parties were going to sign. That the Memorandum of Agreement was not recognised as a soccer contract and could not be used to register him with ZIFA because the Memorandum of Agreement with the defendant was not a contract with a football club. The plaintiff trained with Highfield United and played one friendly game.

The witness maintained that the plaintiff was only going to be entitled to signing on fees upon signing of a football or soccer contract when he would become their player. The Memorandum of Agreement does not constitute a football contract. Later the plaintiff together with three other players was loaned to Black Mambas, a team that the defendant sponsored. Highfield United awaited the plaintiff to return so that he could negotiate a playing term with them. The plaintiff was at that time a free agent and was not attached to any club. The plaintiff used his international clearance certificate at Black Mambas and this was used to register him with the Premier Soccer League. They did not register him with the Zifa Northern Region and therefore they could not at law have loaned him because he was not their player. He denied that the plaintiff was loaned to Mambas but that he was cleared and Mambas were given clearance to assess him and determine if he would fit within their playing structures. The MOA was terminated because the defendant realised that the relationship was not mutual as the plaintiff had refused to sign a soccer contract. There were complaints by the technical team that he was using abusive language and had brought pictures of naked people to training.

The witness admitted that the defendant paid the plaintiff allowances of US$2 500-00 per month from January to July 2011, fuel and maintenance of his vehicle. He denied that the plaintiff was paid as a player. The payments were stopped after the agreement was terminated. The witness insisted that the parties had a commercial arrangement which they hoped would lead to the plaintiff signing a football contract. The witness did not impress the court as a truthful witness. He introduced a number of new issues in his oral evidence. The

additional contract he alluded to was not mentioned in the defendant’s pleadings.

The defence also called Javachava. He is the Zimbabwe Football Association (ZIFA) Northern Region Administrator. Part of his duties entail registering players for Division One and administering football . He testified that the plaintiff was not registered with their league. He defined signing on fees as money paid to the player when he agrees to play for a club. The fees are due when the contract is signed and after engaging the player. The witness was called to explain the administrative procedures required for one to play in the Zifa Division One.

The issues referred to trial are as follows:

“1.Whether the memorandum of agreement signed by the parties constitutes a binding

contract between the parties;

2. What implied conditions, if any, attached to the contract;

3. Whether or not, clause 5.7 of the agreement excludes the operation of the implied

Conditions; and

4. Whether the plaintiff is entitled to signing on fees as claimed.”

The defendant submitted in its closing submissions that as the object of the agreement was to form a partnership, the agreement can only be binding as a partnership where essential elements of a partnership are proved. That the minds of the parties were not ad idem as there is no clear articulation of the contributions of each party. That there is doubt as to whether this contract is binding as it is void for vagueness.

Clause 2.0 of the MOA reads as follows:

“The purpose of this Memorandum of Agreement is to establish a formal partnership between Twalumba and Ndlovu in playing and development of soccer as agreed.”

The partnership referred to is not a business partnership as envisaged at law because it does not meet the requirements of such partnership. The agreement does not have clear undertakings by each party to bring into the partnership any money, skill or labour. It does not seem to me that the parties had the common object of making and sharing profit. The plaintiff was going to be paid allowances only. There is nothing to show that the parties intended to form a partnership as envisaged at law. The type of partnership referred to in the MOA is simply a relationship. It seems to me that the intention of the parties in concluding this contract was that the plaintiff would help in development of soccer in Binga, their home area as well as within Zimbabwe thereby simply creating a contractual relationship. There is no suggestion that the minds of the parties were not ad idem. The absurdity arises from the fact that the MOA was drafted by people without legal expertise. The parties agreed that the contract was drafted by laymen culminating in the inappropriate use of words and terms.

The defendant contends that this contract is not a valid football contract because it does not state the duration of the contract. Although the contract does not state its duration, it remains valid. Duration of a contract is not a legal ingredient for a valid contract. It is a contract without a time limit and is binding on the parties.

The court will examine the contract to determine what type of contract this is. The chief objective of the MOA is that plaintiff would play and develop soccer and be remunerated for it. This would in my view constitute a football contract. The fact that a player does not contract to play competitive soccer does not detract from the fact that it is a football contract. The plaintiff did not enter into a football contract directly with Highfield United football club but with the owner of the club. Mr Makamure testified that this practice is acceptable in football circles. He gave an example of the contract signed between Kennedy Nagoli and the owner of Petraf Tetran the owner of a Czech Republic football club. This evidence went unchallenged. The plaintiff did not have to sign a contract with a football club to be entitled to sign on fees.

Sign on fees are not germane to football only. There is no mystery regarding the concept of sign on fees .Sign on fees are a concept used in football circles, but its application is not exclusive to football.  Sign on fees may be payable as bonuses where an employer seeks to engage a new employee and offers sign on bonuses as an incentive to the employee to join the company.  In a football setup , these are fees that a footballer is entitled to upon signing a football contract. They are generally contract fees .The payment is usually included in the player’s contract and may be paid in kind, cash or instalments. Its payment depends on the terms of the contract entered into. A player is usually entitled to the fees upon signing the contract unless the contract states otherwise. Sign on fees act an incentives for the player to join the club or sign a contact. My view is that this is a contract to supply one’s services where the parties agree to pay sign on fees upon the signing of the contract. The plaintiff did not have to sign a football contract to be entitled to sign on fees.

In determining whether there is a valid contract in existence, the conduct of the parties after the signing of the MOA is pertinent. In Levy v Banket Holdings Pvt Ltd R & N 98  TREDGOLD CJ in relying on the remarks of CENTLIVRES, J.A in Collen v Rietfontein Engineering Works, 1948 (1) SA 413 (AD)  said the  following:

“In considering whether a contract is concluded between two parties, a court is not interested in the state of mind of the parties considered in the abstract. It must decide the issue on the state of mind of the parties as manifested by word or deed. It is idle for a party to avow mental reservations or unspoken qualifications if these are inconsistent with what is said or done.”

The parties’ minds seem to have been ad idem at the time of the signing of the contract. Their conduct after the signing of the MOA supports this finding. All the financial terms of the contract were fulfilled by the defendant except the term relating to the purchase the house. The defendant’s conduct in meeting all the other benefits shows that it intended to be bound by the contract. The defendant has chosen to renege on the term pertaining to the house because it is more onerous. The court is not persuaded by the defendant’s stance that the MOA was just a prenuptial contract and that the parties had agreed to sign a football contract at a later stage. There is nothing in the MOA to support the claim that the clause providing for the purchase of a house in lieu of sign on fees was to apply to a subsequent contract. No proof of such contract was produced and nor are its contents known. This subsequent contract is a figment of the defendant’s imagination. The defendant’s plea and summary of evidence does not refer to the additional contract or the fact that the MOA was a prenuptial contract as alleged.

There are no implied terms to the contract. Clause 5.7 of the MOA provides that the agreement represents the entire agreement between the parties and supersedes all prior negotiations, representations and agreements. The respondent’s submission that this MOA was a prenuptial contract which was required to be followed by a proper contract is nonsensical and does not accord with this clause.  The clause does not refer to any future contracts. The court is not persuaded by the defendant’s claim that the parties had agreed to sign another contract that would result in the signing of some football contract that would bind them.

Clause 5.5 providing for the sign on fees reads as follows:

“Twalumba will pay US55000-00 as sign on fees for plaintiff instead of cash payment, Twalumba will but a house of the above value for plaintiff in Harare’’

The defendant committed itself to purchase a house for the plaintiff. The defendant does not dispute that it did not pay US$55 000-00 or a house as specified in the contract.   There are no conditions attaching to the signing on fees. There is no proposition that the fees would be paid upon the signing of an additional football contract.  This means that even if the plaintiff had been injured a week after the signing of the contract he would still be entitled to receive the signing on fees. The payment of the fees was not conditional upon the happening of any event. There is nothing in the MOA suggesting that the plaintiff would be required to sign a follow up football contract. The defendant did not fully perform its obligations under the contract. The defendant has chosen not to comply with the term relating to the purchase of a house. It is folly for the defendant to argue that the minds of the parties were not ad idem in circumstances where the defendant cherry picks and complies with those terms he fancies and decides not to comply with the most onerous term of the agreement.  The defendants cannot be allowed to choose which obligations to discharge and which not to discharge. The contract is not severable. Whatever the nature of the agreement, its terms entitle the plaintiff to payment of $ 55000-00 as per clause 5.5 of the MOA. The court is not concerned with the term or label that one may want to place on this contract. The MOA constitutes a binding contract between the parties. The court is satisfied that the parties entered into a valid contract whose consequences the defendant must comply with. The plaintiff has shown on a balance of probabilities that he is entitled to the claim. The fact that the plaintiff is now claiming money instead of the house is entirely his choice.

As regards costs, it is the court’s view that the defendant was not unreasonable in defending this action. The concept of signing on fees is a grey area in this jurisdiction. There is no justification for costs on a higher scale.

In the result, it is ordered as follows

The defendant shall pay to the plaintiff the sum of $55 000-00 with interest thereon at the prescribed rate from the date of summons to the date of full payment. Costs follow the event.

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Mtetwa & Nyambirai Incorporating Wilmot & Bennett, plaintiff’s legal practitioners

Sinyoro & Partners, defendant’s legal practitioners