Side Electrical (Pvt) Ltd v Ming Chang Sino Africa (Pvt) Ltd & 2 Ors

### Preamble
1
HH 490-18
HC 7369/18
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SIDE ELECTRICAL (PVT) LTD

versus

MING CHANG SINO AFRICA (PVT) LTD

and

SHERIFF OF ZIMBABWE

and

OFFICER-IN-CHARGE ZRP BINDURA

(MINERALS AND BOARDER CONTROL UNIT)

HIGH COURT OF ZIMBABWE

MUREMBA J

HARARE, 16 August 2018 & 22 August 2018

Urgent Chamber Application

C Nhemwa, for the applicant

S. M Guwuriro, for the 1st respondent

K Chimiti, for the 3rd respondent

MUREMBA J: This is an urgent chamber application for an interdict against the first respondent. The second respondent is the Sheriff of Zimbabwe whilst the third respondent is the Officer-in-Charge ZRP Bindura (Minerals and Boarder Control Unit). The first respondent opposed the application, and in doing so, raised some preliminary points which are as follows.

Matter is not urgent

Mr Guwuriro submitted among other things that the matter was not urgent because the same matter had been removed from the roll by CHIKOWERO J on 9 August 2018. He argued that on this basis the matter should not have been brought back on an urgent basis.

It is common cause that CHIKOWERO J dealt with this matter under HC 7041/18 on 9 August 2018. However, he struck it off the roll saying,

“I do not have an affidavit before me. Rule 227 is of no assistance. Matter is struck off the roll, with applicant paying first respondent’s costs of suit.”

Mr Nhemwa argued that since there was no affidavit before the court, the application was a nullity from the onset. As such after rectifying the affidavit, the applicant was still entitled to bring back the matter on an urgent basis. Mr Guwuriro was adamant that whatever the reasons for the matter being struck off, the same matter cannot be brought back on an urgent basis but should be brought via the ordinary roll. To support his argument he cited a plethora of cases which include the case of Chidawu & Ors v Shah 2013 (1) ZLR 260 (SC) which matter turned on the certificate of urgency which was defective. It was held that a certificate of urgency is the sine qua non for the placement of an urgent chamber application before a judge. It was further held that if the matter is removed from the roll and then brought back on an urgent basis the applicant is required to give an explanation about what happened in the initial application.

The Chidawu case is distinguishable from the present case in that the present case turned on the fatally defective affidavit which rendered the whole application a nullity. The judge could not even rule on the issue of urgency because there was no application at all before him. This is why he struck it off the roll instead of removing it from the roll. A nullity cannot be removed from the roll and neither can it be referred to the ordinary roll because you cannot refer nothing. If nothing was placed before CHIKOWERO J, then it was not irregular for the applicant to bring back the matter on an urgent basis if the matter was still urgent. The matter having been struck off on 9 August 2018, on the next day, 10 August 2018, the applicant filed the present applicant which means that it acted expeditiously warranting the matter to be brought back on an urgent roll.

The case of Tomana v Judicial Service Commission and Another HH 366/16 another case which Mr Guwuriro referred to is also distinguishable from the present case because it dealt with a matter which was removed from the urgent roll to the ordinary roll at the instance of the applicant. Its facts are nowhere near the facts of the present matter. The case of Anthony Hicky v DMC Holdings (Pvt) Ltd & 3 Ors SC 17/14 that was also cited is of no relevance to the present matter. It is a case which was taken up on appeal after this court had held that the matter was not urgent. The Supreme Court held that the matter was urgent and proceeded to grant the provisional order in favour of the respondent. Even the case of Edward Tawanda Mazda & Others v The Reformed Church in Zimbabwe Daisyfield Trust and 3 Ors SC 71/14 dealt with a matter where it was held by this court that the matter was not urgent and dismissed it. On appeal, the Supreme Court said that having ruled that the matter was not urgent this court should have removed it from the roll of urgent matters and referred it to the ordinary roll instead of dismissing it.

All the cases that Guwuriro cited are irrelevant to the present matter. In the initial application the matter was struck off because the application itself was fatally defective. So there was no matter to remove from the roll of urgent matters and refer to the ordinary roll. It was a nullity. It is as good as saying that the applicant never appeared before this court with this matter. Therefore it was entitled to bring a proper or valid application on the urgent roll after rectifying the defects in the affidavit as long as the matter was still urgent.

Mr Guwuriro further argued that urgency that is brought about because of the likelihood of irreparable financial harm demands that the alleged financial harm be proved and in casu the applicant did not prove it because it gave its loss as $14 285 714.28 per month without tendering proof of such loss. He added that and besides, in its initial application in HC 7041/18 which was struck off, this amount had been given as $114 285 714.25. Mr Guwuriro argued that the discrepancy in figures shows that the financial prejudice is not even known by the applicant. Mr Nhemwa explained that the difference in the figures was occasioned by a typographical error otherwise the figure claimed is $14 285 714.28 and not $114 285 714.25. Mr Guwuriro further castigated the applicant for basing its financial prejudice on the amount the first respondent is claiming against it as damages in HC 5633/18. Apparently, the facts of the matter between the parties are that the applicant and the first respondent entered into a cooperation agreement in terms of which the first respondent was bound to finance mining operations at Botha Mine, Bindura and the applicant being the owner of the mine would receive 16% of the total sales of gold with the first respondent getting 84%. However, some disputes later arose between the parties resulting in the applicant being sued for damages by first respondent for despoiling it of the mine and causing disturbances at the mine resulting in financial loss amounting to

$3 000 000.00 in the 9 days it says it was dispoilt of the mine. In the present application the applicant averred that it was losing $14 285 714.28 per month and it averred that it had arrived at that this amount based on the claim for damages the first respondent was making against it in

HC 5633/18.

Just by looking at the nature of the case, it cannot be doubted that this is a matter which can result in irreparable financial prejudice if is not dealt with on an urgent basis. The case involves mining of mineral resources. There cannot be any doubt that any continued mining will result in the depletion of the resource. In any case the whole agreement between the parties is commercial in a nature and is centered on financial benefit. For any amount of gold sold by the first respondent the applicant is entitled to 16% thereof. The percentage entitlement alone indicates that the applicant will suffer irreparable financial prejudice if the matter is not treated as urgent. This is a case where the applicant cannot be expected to be precise with figures of the exact amount of prejudice it will suffer because it is not the one doing the mining. The person that is doing the mining is the first respondent. So it is the one which would know the amounts better. It was therefore proper for the applicant to rely on the figure of $3 000 000.00 given by the first respondent in its claim against it even if the figure has not yet been proven in court. Whilst the figure might not be exact, it however serves to show that there is financial harm that can be suffered by the applicant if it is not heard on an urgent basis. Moreover, the first respondent does not dispute that it is not paying the 16% that it should be paying to the applicant. I thus dismiss the point in limine that the matter is not urgent.

Non-disclosure

Mr Guwuriro submitted that the applicant had not in its founding affidavit disclosed that the matter was removed from the roll by Chikowero J in HC 7041/18. This submission was not correct because as correctly pointed out by Mr Nhemwa, the applicant disclosed this fully in para 13 of its founding affidavit.

I also dismiss this point in limine.

Mr Chimiti indicated that the third respondent was not opposed to the application being granted.

Merits

It is common cause that after the cooperation agreement had been signed in 2016, the parties (applicant and the first respondent) signed 2 supplementary agreements in 2016 and 2017. However, the parties subsequently had disputes which caused the first respondent to approach this court as the applicant and on 30 April 2018, the parties reached a settlement and entered into an order by consent which was to the following effect.

“It is ordered by consent that:

The cooperation agreement between the applicant and the 1st respondent dated 24th May 2016 and the supplementary agreements dated 25th July 2016 and 9th January 2017 be and are hereby declared to be the only valid agreements between the applicant and the 1st respondent.

The applicant and 1st respondent shall observe the terms and conditions of the three agreements in paragraph 1 above and that applicant shall pay the profit shares due to the 1st respondent through its Bank Account held with Ecobank, Bindura Branch.

The applicant be and is hereby granted vacant and undisturbed possession of the mining claims known as Botha 1-4 Bindura.

1st respondent shall have reasonable access for the purposes of implementation of the agreement and to satisfy provisions of the law.

Each party shall bear its own costs.”

The first respondent in the order is the now applicant in the present matter.

Despite having entered into this order by consent, the parties continued to disagree and failed to work together in the spirit of the order by consent. Although the first respondent was obliged to pay to the applicant 16% of the gold proceeds in terms of the order, it never did so at all. This resulted in the applicant writing a letter of demand for payment on 3 July 2018, but the first respondent never responded to it. Instead, the first respondent issued summons in

HC 5633/18 against the applicant’s director Gift Kanosvamhira and Timsite Investments (Private) Limited claiming US$3 000 00.00 for gold allegedly harvested and looted from the mine. In turn the applicant cancelled the cooperation agreement and issued summons in HC 6919/18 to confirm the cancellation of the agreement, and to evict the first respondent from the mine. Both matters are pending in this court.

Pending determination of its case HC 6919/18, the applicant wants the first respondent interdicted from continuing with mining operations at the mine on the basis that gold is an infinite resource which can be exhausted if mining continues. The applicant fears that it will be left with a shell of a mine of no financial benefit to it if the first respondent is not interdicted from continuing with mining pending determination of the dispute between the parties on the validity of the cancellation of the cooperation agreement. The applicant avers that the balance of convenience favours it in the circumstances as the first respondent will not suffer any prejudice if mining is temporarily stopped. It avers that if the interim order is not granted it will suffer irreparable financial harm since the gold which would have been mined and sold will not be restored to it in the event that it wins the case. The order that the applicant seeks is as follows:

“Terms of Final Order Sought

That the 1st respondent and those occupying and mining under its authority at Botha Mine be and are hereby permanently interdicted from carrying out any mining operations at Botha Mine pending resolution of the summons matter under case number HC 6919/18.

That the 1st respondent pays the costs suit at an attorney-client scale.

Interim Relief Granted

Pending the return date and determination of this matter, applicant is granted the following relief:

That the 1st respondent and those occupying and mining under its authority at Botha Mine be and are hereby interdicted from carrying out any mining operations at Botha Mine, pending resolution of the summons matter under case number HC 6919/18.

The 2nd respondent be and is hereby ordered to evict the first respondent and all those occupying Botha Mine under 1st respondent’s authority within 48 hours from date of this order if there is no compliance with this order.

The 3rd respondent be and is hereby ordered to assist the 2nd respondent in his execution of this order if the 2nd respondent requests his/her assistance.”

Mr Guwuriro submitted for the first respondent that the first respondent is entitled to continue with mining operations because there is an existing extant order which the parties entered into by consent on 30 April 2018 under HC 3670/18. He argued that on this basis the applicant cannot seek to set aside this existing order which has not been set aside. He also submitted that the parties were not able to comply with their obligations in terms of the agreements they signed largely due to the applicant’s fault in that it failed to  do what it was expected to do especially coming to the mine to monitor activities/operations. It must be noted that the applicant disputes this saying that the first respondent does not want its (applicant’s) representatives at the mine. Each time they go to the mine the first respondent makes a police report. These accusations and counter accusations indicate that the relationship between these two parties have soured badly hence the continuous litigation that is now on going between them.

The first respondent averred that the gold ore that has been mined from 30 April 2018 to 2 August 2018 is yet to be milled and is still at the mining site. It was submitted that this is the reason why nothing had been paid to the applicant from 30 April 2018 when the parties entered into the order by consent. However, the first respondent did not communicate this to the applicant when the applicant wrote a letter of demand to it on 3 July 2018. It was also submitted that the first respondent has done nothing wrong that warrants cancellation of the agreement. Mr Guwuriro further argued that the applicant cannot seek its eviction in an urgent chamber application when it is seeking the same relief in HC 6919/18.  He further argued that the applicant cannot seek to have this court set aside the order the parties entered into by consent and agreed that the first respondent will be given vacant possession of the mine. It was argued that by virtue of the existence of the order by consent, the interdict that the applicant is seeking cannot be granted.

It is clear from the sequence of events narrated above that the order by consent of 30 April 2018 was overtaken by events. The parties failed to comply with the order and blamed each other for failing to comply with the order. In the result, the applicant cancelled the cooperation agreement between them and is now suing for confirmation of the cancellation whereas the first respondent is now suing for damages in the sum of $3 000 000.00 from the applicant for despoiling it of the mine for 9 days. Pending litigation the applicant wants an interdict to interdict the first respondent from mining. An interdict that the applicant is seeking does not have the effect of setting aside the existing court order that the parties entered into on 30 April 2018. Instead, it seeks to suspend the operation of that order pending determination of the dispute between the parties. This court is empowered to grant such relief, the whole idea being to avoid benefitting the first respondent in the interim at the expense of the applicant which will likely suffer irreparable financial harm if cancellation of the agreement is confirmed by this court. If the applicant loses the case the first respondent will be entitled to continue with its mining operations and it would have occasioned little prejudice. In any case, other than saying that there is an existing and extant court order which cannot be tempered with, the first respondent did not say that it will be prejudiced by the granting of the interdict. It did not even say the kind or nature of prejudice it will suffer. It did not show that the balance of convenience favours the non-granting of the interdict. Besides, the first respondent averred that from the date the order by consent was granted, it has not sold any gold. In that case it will not therefore suffer any harm if the interdict is granted.

If the interdict is not granted, nothing will stop the first respondent from mining. In the event of the applicant then winning its case, it would have lost gold to the first respondent which it might not recover. As it is, from the time the order by consent was granted, it has not received a cent from the first respondent, yet it is entitled to 16% of any amount of gold proceeds the first respondent realizes. It is not known how much gold the first respondent has mined and sold far. There has not been any accountability to the applicant. It is just the first respondent’s word that it has not sold any gold as it is stocking the gold ore at the mine. The applicant has not had access to the mine to verify this. If the interdict is not granted pending the resolution of the dispute, the applicant is likely to suffer irreparable harm. Minerals deplete with continued mining. The balance of convenience thus favours the granting of the interdict. I will thus grant the provisional order. I will not however, grant the applicant’s request for the first respondent’s ejectment from the mine as this will be tantamount to granting an order for eviction in an urgent chamber application.

In the result, it be and is hereby ordered that-:

Pending the return date and determination of this matter, applicant is granted the following relief:

The 1st respondent and all those occupying and mining under its authority at Botha Mine be and are hereby interdicted from carrying out any mining operations at Botha Mine.

C Nhemwa & Associates, applicant’s legal practitioners

Guwuriro & Associates, 1st respondent’s legal practitioners

Civil Division-Attorney General, 3rd respondent’s legal practitioners