Surface Wilmar Private Limited v Windmill Private Limited

### Preamble
1
HH 575-25
HCH 4327/24
---------




SURFACE WILMAR PRIVATE LIMITED

versus

WINDMILL PRIVATE LIMITED

HIGH COURT OF ZIMBABWE

TAKUVA J

HARARE; 19 June & 29 September 2025

Court Application for Recovery of Debt

G Ndlovu, for the applicant

P Mujegu, for the respondent

TAKUVA J: This is a court application where the applicant seeks the following order:

“Judgement in the amount of USD$ 79 500-20, together with interest at the rate of 1% per annum calculated from the 26th of March 2024 to the date of payment in full be and is hereby entered against the Respondent.

The Respondent shall bear the costs of suit in this matter on attorney-client scale.”

Background Facts

This a court application for a recovery of debt. Applicant and respondent are both companies duly registered in accordance with the laws of Zimbabwe. Applicant seeks to recover a debt that is due and payable by the respondent.

The two parties entered into a supply agreement on 20 March 2024 wherein the applicant would supply soya bean meal to the respondent.  The applicant avers that it managed to supply the respondent with a certain quantity of the soya bean meal.  However, the respondent is said not to have paid the applicant the full amount owed to it but rather only paid for just a part of the supply delivered by the applicant. This breach was made on 4 May 2024 and the balance owed to the applicant amounted to USD$139 533-00 according to the applicant.

Consequently, in order to recover its money, applicant followed these events up with a letter of demand sent on 10 June 2024, demanding full payment of the money by 14 June 2024.  It is applicant’s submission that the respondent failed to meet the deadline but however made a few payments that decreased the amount owed to the sum of USD$118 533-00 as of 16 July 2024.

As a result of its failure to meet the deadline, respondent in turn proposed a payment plan to settle the full debt which consisted of four instalments commencing on 12 July 2024 and terminating on 2 August 2024.  Unfortunately for the applicant, respondent still failed to honour its proposed payment plan. The date of termination was reached while the respondent was still owing the applicant a balance of US$79 500-20.  This amount as it stands still remains outstanding. The interest that was also charged by the applicant at the rate of 1% per month has also accrued to USD$6 140-57 calculated from 26 March 2024, to the date of payment in full.

It is due to these two amounts that is, the remaining balance and the interest that the applicant makes this application.

The respondent in this matter opposes this application and raised a point in limine. The first one pertains to jurisdiction. Respondent argues that this matter ought to referred to arbitration as was agreed by the parties in their agreement. It is their view that this court ought not lend the applicant an ear but as the parties agreed that in the event of any dispute arising from the contract, the issue was to be dealt with through arbitration proceedings.

Further, respondent also challenges the competence of the relief sought by the applicant. The applicant seeks payment in USD with no alternative for payment in the local currency at the prevailing rate. This omission on the part of the applicant renders the relief sought incompetent and therefore calls for dismissal of the applicant in respondent’s view.

Issues for determination and the law

In my view the main bone of contention between these two parties are the issues of jurisdiction and currency in which said debt ought to be paid. It should be noted that the respondent does not dispute that it owes the applicant. There might be a challenge over how much exactly that amount is but the respondent admits to be owing applicant a certain amount. Applicant however, demands to have this debt paid in USD as the parties agreed in their contract. Courts enforce contracts as they are made but will not re-write or vary the terms agreed and signed to by the parties. The role of the court is to interpret and enforce contracts, not to make a new bargain for the parties. This flows from the principle of freedom of contract that entails that parties are free to agree on whatever lawful terms they want, and courts respect that autonomy. In the case of Kundai Magodora & Ors v Care International Zimbabwe SC 24/14 by Patel JA stated the following:

“In principle, it is not open to the courts to rewrite a contract entered into between the parties or to excuse any of them from the consequences of the contract that they have freely and voluntarily accepted, even if they are shown to be onerous or oppressive.  This is so as a matter of public policy. See Wells v South African Alumenite Company 1927 AD 69 at 73; Christie: The Law of Contract in South Africa (3rd ed.) at pp. 14-15.  Nor is it generally permissible to read into the contract some implied or tacit term that is in direct conflict with its express terms.  See South African Mutual Aid Society v Cape Town Chamber of Commerce 1962 (1) SA 598 (A) at 615D; First National Bank of SA Ltd v Transvaal Rugby Union & Another 1997 (3) SA 851 (W) at 864E-H.”

This same principle in this case, also then limits the court’s powers in casu in as far as jurisdiction is concerned. The parties’ agreement is clear in that in the event of a dispute, the matter ought to go through the arbitration process. Clause 2 in the contract signed by both parties is titled “DISPUTE RESOLUTION” and it reads,

“In the event of a dispute arising under this agreement it shall be resolved through Arbitration under the rules of the Commercial Arbitration Centre, Harare. Any determination consequent upon such Arbitration shall be binding upon parties thereto.”

It is common cause that this clause exists, and that the dispute between the parties falls squarely within its wording. The court agrees with the Respondent in that the matter has to follow due process and, in this case, both parties agreed to have disputes arising from their contract resolved through arbitration. It therefore follows that the total amount that the respondent ought to pay and the currency thereof will be determined by the arbitrator hearing the matter. There is no convincing evidence provided by the Applicant to prove that the arbitration clause is void, inoperative, or incapable of being performed. The court’s hands are tied and therefore parties ought to follow the terms they agreed to and that includes clause 2 of the contract. Applicant failed to provide good reason as to why the parties should not follow Arbitration.

In Capital Alliance (Private) Limited v Renaissance Merchant Bank Ltd & Others 2006 (2) ZLR 232 (H) at 236C-D Patel J (as he then was) stated:

“In Zimbabwe Broadcasting Corporation v Flame Lily Broadcasting (Private) Limited t/a Joy TV 1999(2) ZLR 448(H), it was held that a clause in a contract to refer a dispute to arbitration is binding on the parties and a party is not at liberty to revoke this clause at any time he wishes to do so. In PTA Bank v Elanne (Private) Limited & Others 2001(1) ZLR 156(H), it was observed that the question whether a dispute fell within the arbitration clause in an agreement was primarily a question of interpretation of the agreement and the arbitration clause. Once it is established that the dispute falls within the ambit of the arbitration clause, the onus to show why court proceedings should not be stayed falls on the party challenging the reference to arbitration.”

See Independence Mining (Private) Limited v Fawcett Security Operations (Private) Limited 1991(1) ZLR 268(H) at 272.

The court will rely on the principle set in the above-mentioned cases. Accordingly, I find that this Court cannot assume jurisdiction over this dispute in light of the arbitration clause. There is nothing that has been presented that can persuade this court to override the binding force of the arbitration agreement.

Disposition

It is ordered that;

The application is dismissed.

The parties be and are hereby directed to proceed in terms of clause 2 of the arbitration agreement.

No order as to costs

Takuva J:…………………………………………..

Gill, Godlonton & Gerrans, applicant’s legal practitioners

Scanlen & Holderness, respondent’s legal practitioners