Zimbabwe Diamond & Allied Minerals Workers’ Union v RioZim Limited and Master of the High Court N.O. and The Registrar of Companies N.O.

### Preamble
1
HH 467- 25
HCH 3619/25
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ZIMBABWE DIAMOND & ALLIED MINERALS WORKERS’ UNION

versus

RIOZIM LIMITED

and

MASTER OF THE HIGH COURT N.O.

and

THE REGISTRAR OF COMPANIES N.O.

HIGH COURT OF ZIMBABWE

DEMBURE J

HARARE: 29 & 30 July & 5 August 2025.

Urgent Chamber application

R Mabwe, for the applicant

E Donzvambeva, for the first respondent

No appearances for the 2nd & 3rd respondents

DEMBURE J:

INTRODUCTION

[1]	This is an urgent chamber application for an interdict. In terms of the draft provisional order filed of record, the applicant seeks the following relief:

“TERMS OF FINAL ORDER SOUGHT

That you show cause why a final order should not be made in the following terms:-

1. 	That the provisional order be and is hereby confirmed.

2. 	Pending the conclusion of the corporate rescue proceedings of the first respondent under case HCH 1945/25, any disposition of assets or property interest by the first respondent, as defined in s 2 of the Insolvency Act, or any balance sheet restructuring is prohibited.

3. 	The first Respondent’s board be and is hereby ordered to abstain from taking any action the effect of which will result in the disposal of any proprietary interest of the first Respondent in any of its assets, securities or property of whatsoever nature.

4. 	In the event that that the first Respondent’s board has already implemented any of its resolutions to dispose assets, securities or property of the first Respondent, the disposal be and is hereby set aside.

5. 	The first Respondent be and is hereby ordered to pay the Applicant’s costs of suit on the attorney and client scale.

INTERIM RELIEF SOUGHT

B. 	Pending the confirmation or discharge of this Provisional Order, the Applicant is granted the following interim relief:’

1. 	The first Respondent’s board be and is hereby interdicted and barred from proceeding with the contemplated transactions and actions contained in its cautionary statement published in The Herald Newspaper of the 21st of July 2025.”

[2]	The application was opposed by the first respondent.

[3]	On 29 July 2025, I heard oral arguments from the parties’ legal practitioners on a point in limine raised by the applicant. On 30 July 2025, I dismissed the point in limine. The full written reasons for my decision are incorporated in this judgment. I then dealt with the first respondent’s first point in limine that the matter is not urgent. After hearing oral arguments on the issue, I dismissed the objection. I found the matter to be urgent. The written reasons thereof are also part of this judgment. The parties’ legal practitioners further made oral submissions on the other points in limine and the merits of the case. I indicated that I would only proceed to deal with the merits if I do not uphold the points in limine. I subsequently reserved judgment sine die.

FACTUAL BACKGROUND

[4]	The applicant is the Zimbabwe Diamond & Allied Minerals Workers Union, a trade union duly registered in accordance with the laws of Zimbabwe. The first respondent is RioZim Limited (“the company”), a public company registered in accordance with the laws of Zimbabwe and listed on the Zimbabwe Stock Exchange (“the ZSE”). The second respondent is the Master of the High Court cited in his official capacity. The Registrar of Companies is the third respondent, also cited in his official capacity.

[5]	It is common cause that on 28 April 2025, the applicant, together with two individuals, filed a court application for the placement of the first respondent under supervision in terms of s 124(1) of the Insolvency Act [Chapter 6:07] (“the Act”) in Case No. HCH 1945/25. The said corporate rescue proceedings are still pending. The application was opposed by the first respondent. The parties subsequently filed all pleadings in that matter as well as their heads of argument, and the matter awaits being set down before a judge for hearing and determination. The Master also filed his report in terms of the law.

[6]	There is also no dispute that on 21 July 2025, the first respondent published in The Herald Newspaper a cautionary statement informing the investing public and shareholders that the company was involved in the final stages of negotiating transactions that may involve the disposal of some of the company’s mining assets and non-core assets. The statement further stated that the negotiations between major shareholders and other potential investors for the purchase of the majority shares of the company were ongoing. The statement was dated 17 July 2025.

[7]	On 23 July 2025, the applicant filed this application seeking a temporary interdict against the company, barring its board from proceeding with the contemplated transactions to dispose of the company’s assets pending the determination of the application for the placement of the company under corporate rescue in Case No. HCH 1945/25. The applicant averred that the disposition of the company’s assets or property before the conclusion of the proceedings in Case No. HCH 1945/25 is unlawful. The disposal, it was further argued, is contrary to the moratorium against the disposal of the company’s assets under s 127 of the Act. That the company is also under the general moratorium in terms of s 126.

[8]	The applicant further averred that the institution of corporate rescue proceedings prohibits the first respondent from disposing of its property. It argued that the first respondent seeks to frustrate and defeat the pending litigation, such that if the application is to succeed, the Corporate Rescue Practitioner (“the CRP”) will inherit a shell. This would defeat the whole purpose of corporate rescue, leaving the creditors and members of the company losing out as the company would potentially slide into liquidation. The disposed assets would not be available for the benefit of all creditors, who include the applicant’s members, who are the company’s employees. They had also filed a criminal complaint against the company with the Zimbabwe Anti-Corruption Commission (“ZACC”) over a litany of criminal allegations, including systematic fraud, asset stripping and financial irregularities.

[9]	The first respondent, in its opposing affidavit, raised the following preliminary points, namely;

(i)	That the matter is not urgent;

(ii)	That the applicant lacks locus standi;

(iii)	That the applicant and the deponent lack authority to institute the application for corporate rescue and this application; and

(iv)	That the applicant failed to comply with s 124(2)(b) of the Act by failing to notify all affected persons of the application by standard notice.

[10]	On the merits, the first respondent contended that the court is being asked to interdict transactions whose terms and substance have not been placed before it. That the details of the transactions are still to be finalised as negotiations are still ongoing. It was also pleaded that the applicant misconstrued the import of the moratorium under s 126. The transactions are disposals in the ordinary course of business designed to address the first respondent’s liquidity challenges. They are reasonable and justifiable to address the company’s liquidity challenges.

[11]	It was further argued that s 127 does not apply to the first respondent as it is not under corporate rescue. The corporate rescue proceedings will only kick in upon the court granting the application in Case No. HCH 1945/25. It also contended that the requirements for an interdict have not been satisfied. The applicant does not have any prima facie right over the first respondent’s assets. It has not obtained any judgment against the company and is not an affected person in terms of s 121(1). The first respondent, therefore, prayed for the dismissal of the application with costs on a legal practitioner and client scale.

[12]	In its answering affidavit, the applicant raised a point in limine that there was no valid opposition before the court as the board of directors of the first respondent was deemed dissolved in terms of s 130(2). It was averred that there was no valid board resolution, and the application was unopposed. On the merits, the applicant insisted with its application.

[13]	I had to deal with the point in limine raised by the applicant first, as its disposal would determine whether the first respondent was properly before the court and could be heard. While the first respondent filed heads of argument, Ms Mabwe advised me that she would not need to file any written submissions and would be prepared to argue the matter.

POINT IN LIMINE RAISED BY THE APPLICANT

WHETHER OR NOT THERE IS A VALID OPPOSITION BEFORE THE COURT

[14]	The applicant raised a point in limine that there was no valid opposition before the court. The opposition was impugned on the ground that there was no valid board resolution authorising the litigation on behalf of the company as the board had been dissolved by virtue of the provisions of s 130(2) and read with ss 125 and 126 of the Act. I must, therefore, determine the question whether or not there is a valid opposition before the court.

SUBMISSIONS ON THE ISSUE

[15]	Ms Mabwe, for the applicant, argued that there was no valid opposition before the court. In terms of s 126 of the Act, once an application for corporate rescue has been made, there is a moratorium placed on all proceedings that can be filed or instituted. The first respondent filed a notice of opposition that appears from p 93. Attached to it is a board resolution for a meeting held on 6 May 2025. At the point the resolution was filed, the proceedings for corporate rescue under case number HCH 1945/25 had been filed. Once corporate rescue proceedings have commenced, the board is dissolved and the powers are vested in the Master pending the appointment of a CRP.

[16]	It was further argued that in terms of s 130(2), the effect of the start of corporate rescue proceedings is to trigger the deeming provision. When I queried how the Master comes in, given the provisions of s 130(2), Ms Mabwe then submitted that the power is vested in the CRP. She further argued that the board cannot exercise any function. The only exception is where there is express authority of the CRP. She referred me to the case of Metallon Gold Zimbabwe (Pvt) Ltd & Ors v Shatirwa Investments (Pvt) Ltd & Ors SC 107/21 at p 16.

[17]	Counsel argued that the deponent was not authorised to depose to the opposing affidavit given the effect of s 130(2) and the Metallon Gold Zimbabwe decision. There was also no authority from the CRP. It is trite that what is expressly prohibited by statute is null and void. See Muchini v Adams 2013 (1) ZLR 67 (S), where the Supreme Court accepted the common law authority that anything done contrary to the direct prohibition of the statute is null and void. The statute says they can only exercise their functions with the express power of the CRP. The deponent is acting contrary to authority. The board resolution would be of no effect.  The notice of opposition filed on behalf of the first respondent was fatally defective and cannot be entertained by the court.

[18]	There was also an argument that at common law, the company should be under the control of the Master pending the determination of the application for corporate rescue. It was further argued that the South African Companies Act speak to what happens from the moment the application is filed to the time it is determined. Had our legislature intended directors to remain with some residual powers, it would have said so. To the extent those residual powers are not provided for in the Act, they do not exist. It would be for shareholders to apply to the court to be permitted to speak for the company. The deeming provision in s 130(2) should be read in its literal sense. The court must interpret this provision literally in light of the decision in Metallon Gold.

[19]	Per contra, Mr Donzvambeva, for the first respondent, submitted that the issue was dealt with exhaustively from para(s) 34-53 of the first respondent’s heads of argument. The moratorium is for the benefit of the company that is sought to be placed under corporate rescue. That moratorium does not take away the company’s right to defend itself against any proceedings against it. If anything, it is a shield of defence for the company and not a spear in the hands of the applicant or anyone who brings proceedings. There is no specific provision in ss 125 and 126 which prohibits the company from defending proceedings against it pertaining to its placement under corporate rescue.

[20]	He further argued that ss 124(4)(a) and 124(5) must be read together. The court must be satisfied that the company is financially distressed and thereafter make a further order to appoint a CRP. Only then does s 130(2) kick in. It cannot apply when there is no order of placing the company under corporate rescue and the appointment of a CRP. This is the correct approach supported by ss 124(4)(a) and 124(5). He referred me to the South African High Court judgment in Sundays River Citrus Company (Pty) Ltd & Anor; In re: Bouwer & Others v Lonetree Citrus CC & Others 2025 (1) SA 529 which dealt with the South African Companies Act s 131(4)(a) equivalent to our s 124(4)(a). It would not make any sense to rely on the provisions of s 130 to say the directors’ powers are divested. To do so would be taking for granted that the order will be issued.

[21]	Counsel also submitted that to interpret s 130(2) out of its proper context would result in an absurdity. Between the time the application is made up to the court hearing, the company would suffer a leadership vacuum. That would not have been the intention of the legislature. Metallon Gold does not deal with the issue before the court. The remarks in that case apply to an entity that has been placed under corporate rescue in an order. The notion that the control is vested in the Master is untenable. The Master is a creature of statute who can only act within the confines of the powers given to him. It is unintended that the Master can take over the running of the company. To interpret s 130(2) in the manner stated would undermine the right of the first respondent to be heard and to a fair hearing in terms of s 69 of the Constitution. The point has no merit and ought to be dismissed.

[22]	In reply, Ms Mabwe argued that the argument that corporate rescue commences upon the making of the order runs contrary to the statute and the Metallon Gold decision. The interpretation accepted by the Supreme Court in Metallon Gold is that upon filing the application, corporate rescue commences. Section 130(2) cannot be subverted as argued. The provisions should have stated that the directors retain residual powers. Corporate rescue proceedings are meant to protect the company’s assets. The constitutional argument cannot apply. The literal interpretation should be adopted. The term “during corporate rescue proceedings” includes the period after filing the application and the hearing of the application. If we confine “during’ to the time when the order is granted, then it defeats the intention of the legislature.

ANALYSIS OF THE LAW AND THE FACTS

[23]	It is trite that rescue proceedings may be commenced either by the company itself through a company resolution or when an affected person applies to the court for an order placing the company under supervision. See s 125(1). The legal position was further settled in Metallon Gold Zimbabwe at p 16, where Malaba CJ stated as follows:

“The mere filing of the application with the Registrar of the High Court, even before the merits of the application are considered, has the effect of commencing corporate rescue proceedings. The temporary moratorium regarding the suspension of the rights of creditors will therefore start at this stage. The law requires the protection of the troubled company’s assets so that corporate rescue practitioners do not inherit shells. This is an important change to the old regime.

In JVJ Logistics (Pty) Ltd v Standard Bank of South Africa Ltd and Ors 2016 (6) SA 448 (KZD) at 448 the court dealt with the moratorium on business rescue proceedings. The court held that:

“During business rescue proceedings, no legal proceeding, including enforcement action, against the company, or in relation to any property belonging to the company, or lawfully in its possession, may be commenced or proceeded with in any forum …”.

During a company’s corporate rescue, the company can only dispose of its assets in circumstances prescribed in s 127(1) of the Insolvency Act. In respect of contracts of employment, the general rule is that employees who were employed by the company before commencement of corporate rescue proceedings will remain employed with no change to their terms and conditions of employment. However, s 129(1)(a) (i)-(ii) of the Insolvency Act provides exceptions to this rule.

Furthermore, the board of directors is deemed to be dissolved during corporate rescue proceedings and directors can no longer exercise their functions as directors. The management of the company is vested in the corporate rescue practitioner.”

[24]	The deeming provision referred to in the above authority is s 130(2), which reads:

“(2) 	During a company's corporate rescue proceedings the board of the company will be deemed to be dissolved, and each director of the company-

(a) 	may no longer exercise the functions of director; and

(b)  	may only exercise a management function within the company in accordance with the express instructions or direction of the corporate rescue practitioner, to the extent that it is reasonable to do so.”

[25]	There is no doubt that the Supreme Court in the Mettallon Gold case outlined the law in relation to corporate rescue proceedings in general and as it related to the issue it was called upon to determine, namely, whether or not the failure to comply with the mandatory provisions of the Act rendered the application a nullity. However, the issue that arises in the current proceedings was not argued before the Supreme Court. The issue before me is whether or not there is a valid opposition before the court. The resolution of the question has far-reaching implications on whether a company in respect of which an order is sought by an affected person to have it placed under supervision by the court in terms of s 124(1) should be heard in the determination of such application. If so, what would be the effect of the deeming provisions under s 130(2), and who can then speak on behalf of that company following the application and at the hearing of the court application under s 124(1)?

[26]	Before I answer the above questions, I pause to state that I found the point in limine to be mutually irreconcilable with what the applicant itself seeks in the interim order. If the argument is that there is no board and, therefore, no authority for the company to litigate, then it would equally render the draft interim relief sought legally incompetent. In the draft order, the applicant seeks an order as follows:

“1.	The first Respondent’s board be and is hereby interdicted and barred from proceeding with the contemplated transactions and actions contained in its cautionary statement published in The Herald Newspaper of the 2first of July 2025.” (emphasis added)

The question would be, which board the applicant is seeking an order against, if it argues that there is no board in the first place. The applicant drags the company to court and, in turn, seeks that it should not be heard. These arguments, in my view, are self-defeating and utterly illogical. The question whether the company would be entitled to challenge any application for corporate rescue proceedings or any other ancillary application thereto before the court grants an order under ss 124(4)(a) as read s 124(5) was not dealt with in the Metallon Gold case. To that extent, this case is distinguishable from that case.

[27]	Further, s 126 does not provide that the company is barred from defending proceedings against it. In fact, the moratorium provision is meant to protect the company itself from legal proceedings, including enforcement actions against it or in relation to its property or such property in its lawful possession. The general moratorium does offer the company itself a shield of protection from creditors’ recovery actions. It clearly reads:

126 General moratorium on legal proceedings against company

“(I) 	During corporate rescue proceedings, no legal proceeding, including enforcement action, against the company or in relation to any property belonging to the company, or lawfully in its possession, may be commenced or proceeded with in any forum. except-

(a) 	with the written consent of the practitioner; or

(b) 	with the leave of the Court and in accordance with any terms the Court considers suitable; or

(c) 	as a set-off against any claim made by the company in any legal proceedings, irrespective of whether those proceedings commenced before or after the corporate rescue proceedings began; or

(d) 	criminal proceedings against the company or any of its directors or officers; or (e) proceedings concerning any property or right over which the company exercises the powers of a trustee; or

(f) 	proceedings by a regulatory authority in the execution of its duties after written notification to the corporate rescue practitioner.” (emphasis added)

The key words in the above provision are “against the company”. The provision, as confirmed by the Supreme Court in Metallon Gold at p 16, is meant to protect the company’s assets from being stripped so that the CRP does not inherit a shell. It is not a provision, in my view, which can be used against the same company it is meant to protect from the creditors. I, therefore, do not see how this provision could assist the applicant in its argument for the point in limine. It is not, therefore, a sword of attack against the company but rather a shield of defence available to the first respondent during corporate rescue proceedings. On that position, I agree with Mr Donzvambeva. As confirmed in Metallon Gold, the moratorium takes effect immediately after the application is filed with the Registrar. The leave to commence or institute proceedings referred to relates to such proceedings as against the company and not by the company itself. There is no bar for the company to defend itself, nor is leave required in such a case.

[28]	There are no specific provisions in ss 124, 125, 126 and 130(2) which state that following the filing of the application, the company cannot be heard or has no right of audience in relation to the corporate rescue proceedings or other interlocutory court processes, including the present application. It is only a literal interpretation of s 130(2) which can deprive the company of its basic right to defend itself. The right to a fair hearing enshrined under s 69(2) of the Constitution (available to corporate persons by virtue of s 44 thereof, which incorporates a juristic person under persons whose fundamental rights are provided for under [Chapter 4] cannot be taken away lightly. In any case, s 86(3)(e) of the Constitution is very clear that no law may limit the right to a fair trial, which under s 69 applies to both criminal and civil proceedings, nor can it be violated by any person. The right is absolute. No law can be interpreted in such a way as to take away such a right.

[29]	Section 46(1)(a) of the Constitution also mandates this court, when interpreting any statute, to give effect to the rights and freedoms enshrined under the Declaration of Rights. It is trite that the cardinal canon of interpretation is the literal or golden rule of interpretation that words must be given their ordinary and grammatical meaning unless to do so would lead to an absurdity, or a repugnancy, or inconsistency with the intention of the legislature. See Pwanyiwa v Shamva Gold Mine SC 34/24. At pp 6-7, Mavangira JA restated the legal position as follows:

“In Godfrey Tapedza & 9 Ors v Zimbabwe Energy Regulatory Authority & Anor SC 30/20, this Court, per Hlatshwayo JA, as he then was, stated as follows at p 4:

“It is an established principle of law that when interpreting a statute, the first canon of interpretation to be applied is the golden rule of interpretation.  This rule is to the effect that where the language used in a statute is plain and unambiguous, it should be given its ordinary meaning unless doing so would lead to some absurdity or inconsistency with the intention of the legislature.  A provision of a statute should be given a meaning which is consistent with the context in which it is found.”

The learned Judge also aptly cited Chegutu Municipality v Manyora 1996 (1) ZLR 262 (S) at 264 D - E where Mcnally JA stated the following:

“There is no magic about interpretation. Words must be taken in their context.  The grammatical and ordinary sense of the words is to be adhered to, as LORD WENSLEYDALE said in Grey v Pearson (1857) 10 ER 1216 at 1234, ‘unless that would lead to some absurdity, or some repugnance or inconsistency with the rest of the instrument, in which case the grammatical and ordinary sense of the words may be modified so as to avoid that absurdity and inconsistency, but no further.’”

See also Chihava & Ors v The Provincial Magistrate Francis Mapfumo N.O & Anor 2015 (2) ZLR 31 (CC) 35H-36A.

[30]	The words in s 130(2) must be read in their context. They relate to the control of the company during the corporate rescue proceedings. The period of what is covered by the term “during” is defined in s 125(1) and (2) as to when it “begins” and “ends”. However, there is no reference to the control of the company being vested in the Master even when the application has not yet been heard and determined or at any time from a reading of those provisions. In any case, the Master can only exercise specific statutory powers as he is a creature of statute. I am not aware of any statutory or common law authority granted to the Master to take over the running of company affairs before an application in terms of s 124(1) is heard.

[31]	Further, s 130(2) would only apply in the context of an application by an affected person which is yet to be determined if it has merit or not, takes effect upon the order issued commencing corporate rescue proceedings in terms of s 124(4)(a) and a further order in terms of s 124(5). It was never the intention of the legislature to create a vacuum in respect of who should represent the interests of the company during the period after the filing of the application but before the court is satisfied that the corporate rescue is warranted under s 124(4)(a). To adopt a literal interpretation of s 130(2) to mean that at the stage where the court is yet to assess the merits of the application, the company is already without legal representation would, in my view, result in an absurdity, militate against logic and would lead to an unbusinesslike result and undermine the purpose of the section. The company is still entitled to be heard in the corporate rescue proceedings and the present application.

[32]	The law could not anticipate a situation where the applicant can only sue the company and the company itself, on the other hand, cannot speak during those proceedings, which would potentially affect its operations. The right to a fair hearing would entail the right for the company to be heard and make submissions during the hearing and determination of the application for corporate rescue proceedings, including in an application of this nature before the court has exercised its powers under s 124(4)(a).

[33]	The correct interpretation, in the context where a hearing itself is required as part of the due process and the company’s right to representation and to be heard, means that s 130(2) cannot be extended to cover the period before the application under s 124(1) is heard and determined. This resonates with the fact that under s 124(4)(a), the court, after considering the application, if satisfied, may “make an order placing the company under supervision and commencing corporate rescue proceedings”. That is the context under which s 130(2) ought to be viewed, as to hold otherwise would simply mean that there is a vacuum which could not have been the intention of the legislature. That vacuum would have serious unconstitutional consequences of denying the company the right to be heard in a matter affecting it.

[34]	The due process must still be followed even after the application has been filed or corporate rescue has duly commenced from such filing in terms of s 125(1)(b). But it must not follow that the company itself must be deprived of the right to defend the proceedings through its existing structures. While there are other interventions, such as the general moratorium under s 126, which are meant to protect its assets pending the determination of the application, in my view, the power to institute proceedings by the company or to defend itself in such proceedings is not what was meant to be prohibited. I, therefore, cannot accept that there is no board of directors at this stage when the court is yet to exercise its powers in assessing the merits of the application, a process it cannot purportedly take while the ‘company’s hands are tied up’ or its ‘mouth sealed’. The deeming provisions of s 130(2) can only, therefore, be triggered in the context when the court exercises its powers under s 124(4)(a) as read with s 124(5).

[35]	I fully associate myself with the remarks by the South African High Court in Sundays River Citrus Company (Pty) Ltd & Anor, In re: Bouwer v Lonetree Citrus CC & Ors supra on the interpretation of s 131(4)(a) of the South African Companies Act, 2008 which is worded the same as ours 124(4)(a). In para 19, the court had this to say:

“In the case of court ordered business rescue proceedings, a practitioner is only appointed after a court has made a s 131(4)(a) order. The mere filing of an application is no guarantee that the court will make the s 131(4)(a) order to begin business rescue proceedings, or that a practitioner will be appointed. The sequence is logical. A creditor has initiated liquidation proceedings against a company. The company is financially distressed and requires supervision, but the board is unable to resolve to commence voluntarily business rescue proceedings. A shareholder is an ‘affected person’ and applies to court for an order. The purpose of the order is two-pronged: commence business rescue proceedings and place the company under supervision. That order, by definition, imposes oversight and that oversight is the responsibility of a practitioner to be appointed. That appointment may only be made by the court as a ‘further order’, after a s 131(4)(a) order has already been made. Oversight is now the responsibility of the practitioner and is imposed on the company for the duration of the proceedings.” (emphasis added)

In this context of an application by an affected person, the company is still under the control of the directors until the court issues an order in terms of s 124(4)(a) and the further order for the appointment of a CRP under s 124(5). That is the only logical conclusion that makes sense to ensure the company is not deprived of its right to he heard during the hearing and determination of the corporate rescue application. I believe this is the context upon which the applicant seeks an interim order against the same board. It cannot argue that it does not exist. Taking that stance simply means the company can never participate or be heard in proceedings which may affect its future. That can never be the intended consequences of the provisions of s 130(2) as read in the context of an application filed by an affected person and the role of the court in s 124(4) as read with s 124(5).

[36]	The context would certainly be different where the corporate rescue proceedings are commenced by way of a resolution which allows the company to appoint a CRP within five days after adopting and filing the company resolution. See s 122(3). That company-initiated process has strict timelines which do not create any unnecessary delays. It eliminates prolonged periods of uncertainty in terms of company leadership. The process through a court application is entirely different, as the process is generally under the purview of the court, and it may encounter delays associated with the general conduct of litigation. While the corporate rescue proceedings are by their nature expected to be dealt with expeditiously (See Metallon Gold p 18), delays may be unavoidable.

[37]	In the circumstances, I am not satisfied that s 130(2) can be interpreted to take away the company’s constitutional right to participate in a public hearing and the determination of the application under s 124(1) and even the present proceedings. The company is the first respondent, and the matter cannot be heard while it is denied a voice, as argued, when it is an equally affected person in these proceedings. The law did not anticipate only unopposed proceedings where an affected person sues the company for it to be placed under supervision. If that was the intention, the legislation would have said so. In any case, as alluded to above, such a law would fail to meet the constitutionality test of validity.

[38]	It is trite that it is the board of directors which performs judicial acts on behalf of the company and can authorise anyone to act in the stead of the company in court proceedings. See Dube v Premier Service Medical Aid & Anor SC 73/19. Shareholders have no such mandate. This is also in line with the established principle of separate legal personality. The argument by Ms Mabwe that shareholders could approach the court themselves is legally untenable. In the circumstances of this matter, the board was the only authority which could speak or litigate, and its resolution was valid. Consequently, I do not agree that the first respondent’s opposition before me is invalid. I accordingly dismiss the point in limine.

PRELIMINARY POINTS RAISED BY THE FIRST RESPONDENT

URGENCY

THE SUBMISSIONS

[39]	Mr Donzvambeva submitted that the issue of urgency was addressed from para(s) 8-14 of the first respondent’s heads of argument. The first respondent’s contention was that the matter was not urgent on the following basis: firstly, the applicant knew as far back as 14 May 2025 that the first respondent was in the process of implementing a business strategy slated for the period June 2025 to June 2026. The point was raised in para 54.4 of the opposing affidavit filed on 14 May 2025. It has always been within the exclusive knowledge of the applicant that the first respondent was implementing a business plan which would include disposing of some of its non-core assets to raise liquidity.

[40]	It was further argued that the second basis was that the cautionary statement of 21 July 2025 was not the first one. An earlier cautionary statement was issued on 29 May 2025 after the application was filed. The applicant cannot ground its urgency on the latest announcement. As the applicant rightly averred in the founding affidavit, the application is a continuation of the corporate rescue proceedings commenced on 28 April 2025. As of 14 May 2025, the applicant became aware of the actions intended by the first respondent. It did nothing. Two months down the line, it jolted into action on self-created urgency. The matter was not urgent and must be struck off the roll with costs on a legal practitioner and client scale.

[41]	In response, Ms Mabwe submitted that the matter was urgent. She submitted that generally, a matter is urgent if it meets the requirements set out in r 60(3). The relief before the court is a procedural relief that a moratorium be placed on the disposal of the company’s assets pending the determination of the application. In terms of s 176 of the Constitution, this court has the power to control its own process. A process had been filed and has the effect of seeking to protect the company’s assets. This was confirmed in Metallon Gold. If urgent relief was not granted, there was risk that by the time the corporate rescue proceedings are activated by the practitioner, the relief sought would be rendered void. There was risk of perverse conduct by the company’s board. See also pp 28-32, where there is a judgment by CureCam. There was also risk of irreparable harm. If the assets are disposed of at this time, it might be difficult to reverse them. The ramifications will be difficult to reverse once the CRP assumes control.

[42]	Counsel further argued that on the time factor, the applicant became aware of the cautionary statement on 21 July 2025. The application was filed on 23 July 2025. The applicant did not waste time. It moved quickly to protect its rights. On 29 May 2025, there was no clear intention to dispose of the company's assets. On the issue of consequence, counsel referred me to p 119 para(s) 5.7 to 5.11. The submission made on behalf of the applicant is that it is important for the assets of the company to be protected so that if the CRP is appointed, the company is driven to success. It is in the interests of justice that no dissipation of its assets should be done, especially where prima facie the first respondent is struggling. It would be difficult to unravel all this if the disposals are permitted to go on. The application meets all the requirements of urgency. The court must hear the matter on an urgent basis.

[43]	In his reply, Mr Donzvambeva submitted that Ms Mabwe had largely touched on the merits instead of restricting herself to whether the matter can be heard on an urgent basis. Rule 60(3) deals with chamber applications in general. It is not a rule that restricts itself to urgent matters. The matters listed in r 60(3) cannot be used as a basis to justify the urgency of the matter. The submissions relating to the contents of the opposing affidavit in the main matter brought to the applicant’s attention on 14 May 2025 had not been challenged. The applicant misunderstood the moratorium in s 126. That moratorium is meant to protect the first respondent against creditors during corporate rescue proceedings. The moratorium is not meant to bar the company from proceeding with its activities.

[44]	Counsel also went on to submit that it was difficult to tell how the disposition would result in any irreparable harm. The assets meant to be disposed of are non-core assets. There is nothing in the Act to prohibit the efforts by the first respondent to revitalise its business. There is nowhere the applicant can tell the consequences of the transactions. The applicant speculates on the consequences. Nothing has been placed before the court to justify the urgency of the matter. The applicant was given notice of the intended disposal on 14 May 2025 and the cautionary statement of 29 May 2025. He insisted that the matter was not urgent and must be struck off the roll with costs on a punitive scale.

THE LAW ON URGENCY

[45]	It is trite that a matter is urgent if it cannot wait in the sense that if not dealt with immediately, irreparable harm or prejudice will result to the applicant. Urgent matters are not concerned with self-created urgency. The law on urgency was aptly laid out in Kuvarega v Registrar-General & Anor 1998 (1) ZLR 188H at 193 F-G where Chatikobo J stated that:

“What constitutes urgency is not only the imminent arrival of the day of reckoning; a matter is urgent, if at the time the need to act arises, the matter cannot wait. Urgency which stems from a deliberate or careless abstention from action until the dead-line draws near is not the type of urgency contemplated by the rules. It necessarily follows that the certificate of urgency or the supporting affidavit must always contain an explanation of the non-timeous action if there has been any delay.”

The Court went on to state that:

“For a court to deal with a matter on an urgent basis, it must be satisfied of a number of important aspects. The court has laid down guidelines to be followed. If by its nature the circumstances are such that the matter cannot wait in the sense that if not dealt with immediately irreparable prejudice will result, the court can be inclined to deal with it on an urgent basis. Further, it must be clear that the applicant did on his own part treat the matter as urgent. In other words, if the applicant does not act immediately and waits for doomsday to arrive, and does not give a reasonable explanation for that delay in taking action, he cannot expect to convince the court that the matter is indeed one that warrants to be dealt with on an urgent basis...”

[46]	In Documents Support Centre (Pvt) Ltd v Mapuvire 2006 (2) ZLR 240 (H), Makarau JP (as she then was) had this to say:

“I understand Chatikobo J in the above remarks to be saying that a matter is urgent if when the cause of action arises giving rise to the need to act, the harm suffered or threatened must be redressed or arrested there and then for in waiting for the wheels of justice to grind at their ordinary pace, the aggrieved party would have irretrievably lost the right or legal interest that it seeks to protect and any approaches to court thereafter on that cause of action will be academic and of no direct benefit to the applicant.”

APPLICATION OF THE LAW TO THE FACTS

[47]	Applying the above principles, when considering the issue of urgency, the judge must consider the time and consequence dimensions. The decision whether or not the matter is urgent involves the exercise of a discretion. See Econet Wireless (Pvt) Ltd v Trustco Mobile (Pty) Ltd SC 41/13. Ms Mabwe referred me to the provisions of r 60(3). In my view, the submissions relating to the provisions of that rule were misplaced. The said provisions address the grounds on which notice of a chamber application should not be given to interested parties. The provisions apply to chamber applications in general and state that a chamber application shall be served on all interested parties unless the applicant reasonably believes that the grounds set out in para(s) (a)-(e) of r 60(3) exist. The test for urgency remains that set out in the above authorities.

[48]	As regards the time dimension, I am of the view that the applicant did not waste time in approaching the court. The first respondent sought to conflate this application with the court application for corporate rescue filed on 28 April 2025. The causes of action are clearly different. The mere fact that the corporate rescue proceedings were not brought on an urgent basis cannot per se defeat the urgency of this application.

[49]	It is common cause that the first respondent is a listed entity on the ZSE. It officially communicates with the public investors and interested stakeholders by way of cautionary statements. While there was a business plan attached to the notice of opposition filed in the main matter and served on 14 May 2025 highlighting some of the planned transactions for a period spanning from June 2025 to June 2026, the company did not publish that it intended to proceed with any transactions relating to the disposal of some of its mining assets and non-core assets in its cautionary statement published after 14 May 2025. On 29 May 2025, the first respondent published a cautionary statement, in which it did not specify that the disposal of the company's assets was one of the contemplated transactions that the company was pursuing to address its liquidity challenges. There was only reference to an equity sale transaction. That cautionary statement stated that:

“The Directors of RioZim Limited (the "Company") wish to advise its shareholders and the investing public that further to the cautionary announcement dated 4 March 2025, the major shareholders are now at an advanced stage in negotiating with the potential investor, who will inject an initial amount of Twenty Million United States Dollars (USD20,000,00.00) into the working capital of the Company, through an appropriate financial instrument whilst completing a purchase of the majority shares of the Company (hereinafter referred to as "the Transaction").

Shareholders are advised that the said Transaction remains subject to, the completion of due diligence, signing of the Sale and Purchase Agreements, obtaining any required regulatory and shareholder approvals. Upon conclusion of the Transaction, the investor will follow the relevant rules of the Zimbabwe Stock Exchange for making a mandatory offer to the remaining minority shareholders to purchase their shares in the Company.

Furthermore, shareholders and the investing public are being advised that the Zimbabwe Diamond & Allied Minerals Workers Union, representing some of the employees of the Company, lodged an application to place RioZim Limited under supervision and commence Corporate Rescue Proceeding (hereinafter referred to as the "Application"). The Company has taken the necessary legal steps in dealing with the said Application accordingly.

Shareholders and the investing public are advised to exercise caution when dealing in the Company's securities. Further announcements will be made in accordance with regulatory requirements as and when there are material
developments.” (emphasis added)

[50]	The above represented the official position of the company regarding the transaction it was pursuing. The statement did not specify that the company was contemplating another transaction for the disposal of its mining assets and non-core assets. Reasonably, any person in the position of the applicant would believe that the company was not pursuing any other transaction which would result in the disposal of its mining assets and non-core assets. The cautionary statement of 29 May 2025 could not reasonably have jolted the applicant into taking legal action. Further, the response in the notice of opposition of 14 May 2025, which was not confirmed in an official statement of 29 May 2025, could not have been reasonably expected to trigger the current litigation. Given the wording of the cautionary statement of 29 May 2025, the applicant could not have pursued litigation when the company did not mention that it was pursuing the disposal of any of its mining assets, as stated in the business plan it had attached to the notice of opposition served on 14 May 2025.

[51]	It was on 21 July 2025 that the company officially informed the public investors and shareholders through a cautionary statement that it was pursuing a transaction which may involve the disposal of some of its mining assets and non-core assets. This was the first time it went public on the contemplated transactions, highlighting that the conclusion of the negotiations was imminent. The said cautionary statement stated as follows:

“The Directors of RioZim Limited (the "Company") wish to advise its shareholders and the investing public that further to the cautionary statement dated 29 May 2025, the Company is involved in the final stages of negotiations of transactions that will have a material effect on the Company's balance sheet. These transactions may involve the disposal of some of the Company's mining and non-core assets.

The conclusion of the negotiations is imminent which will resolve the Company's financial and operational challenges. The negotiations between the major shareholders and other potential investors for a purchase of the majority shares of the Company are still ongoing, with due diligence process continuing at an advanced level.

In respect of the Corporate Rescue Application, all legal papers have been filed and a set down date is awaited. Accordingly, Shareholders and the investing public are advised to exercise caution when dealing with the Company's securities. Further announcements will be made in accordance with regulatory requirements and when there are material developments.” (emphasis added)

[52]	The cautionary statement of 21 July 2025 made the company’s intention clear concerning the disposal of the company’s mining assets. I agree with Ms Mabwe that the need to act in the circumstances arose on 21 July 2025.  The applicant did not waste time as it filed the present application two days later, on 23 July 2025. It clearly treated the matter as urgent. It sought to enforce the moratorium set out in s 127, as what is sought is an interdict against the company proceeding with the transactions stated in the 21 July 2025 cautionary statement. In that regard, I do not agree that the urgency was self-created.

[53]	As regards the consequence or harm, I am also satisfied that in the circumstances this matter cannot wait in the sense that if it is not dealt with immediately, irreparable prejudice will result. The applicant cannot wait for the wheels of justice to grind at their ordinary pace. The first respondent in its cautionary statement of 21 July 2025 highlighted the imminent conclusion of the negotiations for the transaction for the disposal of the company’s mining and non-core assets. If the court fails to intervene, the applicant would irretrievably lose the right or interest it seeks to protect, as the transaction for the disposal of the assets would be completed before the matter is heard. That would then render the present application academic and of no direct benefit to the applicant. It would suffer irreparable harm as the transaction, if completed, cannot be interdicted. In MDC T v Timveos & 4 Ors SC 9/22 at p9 the court stated that:

“An interdict is a summary order, usually issued upon application, by which a person is ordered either to do something, stop doing something in order to stop or prevent an infringement of a certain right.”

[54]	The issue of an interdict falls away if, at the time the matter is heard on an ordinary roll, the assets would have been alienated already. Thus, Mangota J in Stumbel Bloc Zimbabwe (Pvt) Ltd v Ncube & Ors HH 92/23 concluded that:

“So is the point that the need to stay execution fell away since the goods had already been sold, meaning this court cannot interdict something that has been done lawfully. For these reasons, the court is of the view that the applicant is attempting to close the stables when the horse had bolted.”

I agree with Mr Donzvambeva though that Ms Mabwe largely addressed the court on the merits in her submissions under the consequence dimension of the urgency. However, given the commencement of corporate rescue proceedings by virtue of s 125(1)(b), which are also still pending and the cause of action in this suit in which the applicant seeks a temporary interdict to preserve the company’s assets subject to those pending corporate rescue proceedings I accept that the matter must he heard on an urgent basis.

For the above reasons, I found the matter urgent and dismissed the point in limine.

WHETHER THE APPLICATION IS FATALLY DEFECTIVE

SUBMISSIONS ON THE POINT

[55]	Mr Donzvambeva submitted that there is no valid application before the court on the basis that the application provides a wrong dies induciae. He argued that the first respondent was notified to file a notice of opposition within 24 hours. The dies induciae is incorrect and renders the application fatally defective. Reference was made to the submissions in para(s)1-14 of the first respondent’s heads of argument. In the heads of argument, counsel relied on the case of Reverend Clement Nyathi v The Trustees for the Time being of the Apostolic Faith Mission of Africa & Ors SC 63/22. It was also argued that this authority is binding on this court.

[56]	I was also referred to the ex tempore judgment in Vislink Investments (Pvt) Ltd t/a Trauma Centre Hospital & Anor v Condev Property Development (Pvt) Ltd & Ors, a judgment said to have been handed down on 16 June 2025 in Case Number HCH 2693/25. It was held that any departure from the dies induciae contained in Form No. 23 is a nullity. Form No. 23 does not provide for a period that is less than 10 days. Form No. 23 and Form No. 25 do not talk of any hours. The hours given are alien to Forms No. 23 and 25. The Marick Trading (Pvt) Ltd v Old Mutual Assurance Company of Zimbabwe (Pvt) Ltd & Anor 2015 (2) ZLR 343 (H) is not authority to provide the dies induciae of hours and not days. The application is a nullity and ought to be struck off the roll with costs on a legal practitioner and client scale. The court cannot condone a nullity. See Jensen v Acavalos 1993 (1) ZLR 216 (SC).

[57]	Ms Mabwe, on the other hand, argued that r 60(1) permits a party in urgent chamber applications to make that application with appropriate modifications. The appropriate modifications are not explained in the rules, but guidance may be obtained from Marick Trading. A party intending to serve an application must make sure that the application is in a hybrid of Form No. 23 and Form No. 25. Guidance should be sought to r 60. In urgent chamber applications, there is no specific period within which the notice of opposition must be filed. A party provides a time limit which is not cast in stone. A party may complain that the time is too short. What a party cannot do is to refuse the time stipulated in the notice. To say the time limit is ten days would be to defeat the purpose of urgent chamber applications. The decision in Vislink Investments is not binding as it is a decision of a judge of parallel jurisdiction. In terms of r 7, this court has the power to condone or direct departure from the rules in the interest of justice. This court can issue directives on how this matter should proceed. The submission is self-defeating when they filed their papers. In Dube v Premier Medical Aid Society SC 73/19, the Supreme Court indicated that the justice cannot be sacrificed on the altar of slavish obedience to the rules.

ANALYSIS OF THE LAW AND THE FACTS

[58]	Rule 60(1) provides as follows:

“A chamber application shall be made by means of an entry in the chamber book and shall be accompanied by Form No. 25 duly completed and, except as is provided in subrule (2), shall be supported by one or more affidavits setting out the facts upon which the applicant relies:

Provided that, where a chamber application is to be served on an interested party, it shall be in Form No. 23 with appropriate modifications.”

[59]	In casu, the urgent chamber application was intended to be served on interested parties, including the first respondent. The proviso to rule 60(1) would, therefore, apply. As aptly put in Marick Trading supra, Mafusire J had this to say:

“7. I have also had occasion to comment on this matter. In Base Minerals Zimbabwe (Private) Limited & Anor v Chiroswa Minerals (Private) Limited & Ors[HH 559-14] I said, in relation to non-urgent chamber applications [at pp 7-8]:

“The proviso to r 241(1) permits the modification of Form 29 where the chamber application has to be served. What would constitute “appropriate modifications” is not stated. Why then does it become important that every time a chamber application has to be served, the applicant should abandon Form 29B and switch over to Form 29? In my view, once the chamber application becomes one that must be served then the respondent is entitled to a period within which to file opposing papers. The “appropriate modifications” would include, in my view, a fusion of the contents of Form 29 and those of Form 29B. In other words, it becomes a hybrid, containing both “…. the plethora of procedural rights…..” of Form No. 29, including the dies induciae, and a summary of the grounds of application of Form No. 29B.”

[60]	It is not in dispute that the plethora of procedural rights in Form No. 23 must be stated in the notice of the urgent chamber application. The notice in this case provides them. However, Form No. 23 itself contains no period upon which the respondent must file a notice of opposition. It is blank on the portion for the dies induciae. The dies induciae in respect of a court application is provided for in r 59(6). It is not stated on the Form No. 23 itself. With regard to an urgent chamber application, there is no specific mandatory provision of the rules which states that the dies induciae should be 10 days. I, therefore, do not agree that the dies induciae as stated in Vislink Investments in Form No. 23 is 10 days. That Form does not say so. It would also be inappropriate in my view and contrary to the nature of urgent chamber applications to incorporate the provisions of r 59(6) as providing the dies induciae in relation to urgent chamber applications. That interpretation would also be inconsistent with the provisions of r  60(6), (8), and (9), which deal with urgent chamber applications.

[61]	A reading of the provisions of subrule (6), (8) and (9) of r 60 applicable specifically to an urgent chamber application, it is clear that the judge is the case manager in such applications. The judge has a discretion to simply consider the papers before him or to direct that the parties file further papers or appear before him and argue on any issue. The judge may even direct the time within which the respondent must file its opposing papers. It would also be entirely up to the judge to shorten the timeframe or fix the period within which the respondent must respond, depending on the circumstances of each case. There is nothing from the said provisions to suggest that there is a strict and mandatory dies induciae of 10 days applicable to urgent chamber applications.

[62]	The dies induciae under r 59(6), which applies to court applications, does not apply to urgent chamber applications whose timelines, in my view, are entirely controlled by the judge before whom the application is placed. The proviso to rule 60(1) only relates to the adoption of Form No. 23 with appropriate modifications. It does not specify any mandatory period for the dies induciae to be used in urgent chamber applications and inserted on the Form No. 23, which must be adopted. The argument that by giving the respondent 24 hours to file notice of opposition, the application was fatally defective is, therefore, legally untenable.

[63]	Further, Mr Donzvambeva relied on the case of Reverend Clement Nyathi for his argument. However, this case is distinguishable. The denotion of the correct dies induciae in that case was held mandatory as it was taken in the context of the provisions of the peremptory period of 3 days prescribed by r 43(5) of the Supreme Court Rules, within which a notice of opposition must be filed. Thus, at p 7, Kudya JA went on to state that:

“It is common cause that, the applicant accorded the respondent 5 days within which to file their opposing papers instead of the 3 days that are prescribed in peremptory terms in r 43(5) of the rules of this Court. The rule in question provides that:

“(5) The respondent shall be entitled, within three days of service, to file with the registrar his or her opposing affidavits, which shall also be served on the applicant and the applicant shall thereafter be entitled, within three days, to file with the registrar his or her answering affidavits.”

While the respondents’ legal practitioners had a duty to the court and a responsibility to their clients to abide by the mandatory requirement, they were misled into default by the defective dies induciae, to the prejudice of the respondents.

The applicant’s failure to accord the proper notice period to the respondents was a fatal defect, which rendered the application a nullity. A nullity cannot be condoned. There is therefore no proper application before me. I must, per force, strike it off the roll.” (emphasis added)

[64]	What is clear from the above authority is that there was a peremptory dies induciae provided for by r 43(5) of the Supreme Court Rules, which the applicant failed to comply with. The position in this case is completely different, where the provisions of rule 60(1) do not prescribe a peremptory dies induciae which must be stated in Form No. 23 for the respondent to file its opposing papers to an urgent chamber application. In the absence of such specific peremptory provision of the dies induciae to be used, the insertion of 24 hours or any other days cannot render the urgent chamber application fatally defective or a nullity.

[65]	As alluded to above, the provisions of r 59(6) applicable to ordinary court applications, which set out the peremptory dies induciae to be inserted in Form No. 23 when making such an application, do not apply to an urgent chamber application. The proviso to r 60(1) only mandates the adoption of Form No. 23 with appropriate modifications, and that Form No. 23 does not prescribe the dies induciae of 10 days at all. The provisions of r 59 relating to ordinary court applications would only apply by virtue of r 60(12) subsequent to the issue of a provisional order. Thus, r 60(12) provides:

“(12) 	Subrules (2) and (11) of r 59 shall apply with the necessary changes to the enrolment and hearing of a matter consequent upon the issue of a provisional order referred to in sub rule (11):

Provided that, where a legal practitioner has certified in writing that a matter is urgent, giving reasons for its urgency, the court or a judge may direct that the matter be set down for hearing at any time and additionally, or alternatively may hear the matter at any time and place, and in such event the ordinary periods of notice to the registrar and any other party shall not apply to the matter.”

[66]	In the circumstances, the point that the application is fatally defective for stating a period of 24 hours within which the first respondent should file opposing papers is without legal foundation. It is accordingly dismissed. In any case, the first respondent filed its papers within that time and never complained or requested to be given any further period to prepare its papers. Since there is no specific mandatory dies induciae in respect of urgent chamber applications, I would not have hesitated to consider giving the first respondent any further extended period if it was required in terms of r 60(8).

LACK OF LOCUS STANDI

SUBMISSIONS ON THE POINT

[67]	Mr Donzvambeva submitted that the applicant has no locus standi to institute these proceedings. He further argued that the issue is dealt with extensively in para(s) 15-22 of the heads of argument. The applicant averred that this is a continuation of corporate rescue proceedings. It further averred that it’s a trade union registered to represent employees in the diamond industry. A trade union registered in the industry does not have the locus standi to institute proceedings for corporate rescue in terms of s 121. The Supreme Court in Metallon Gold held that for a trade union to have locus standi, it must be a registered trade union representing employees of the company. Section 121 of the Act defines what a trade union is. It is accepted that the applicant is registered to represent employees in the industry and, therefore, falls outside the ambit of s 121. The application must be dismissed for lack of locus standi on a legal practitioner and client scale.

[68]	Ms Mabwe argued that the requirement of the law is that the applicant must prove a substantive right. At this point, it must simply establish a prima facie right. It suffices that there is the main application. The request is for the court to deal with the main matter when it is only dealing with the procedural application. It is an interested party in the matter. It represents employees of the first respondent. These employees have said they are affected by the transactions and have placed before the court the application. The definition of locus standi under the new Constitution has been widened. See Mawarire v Mugabe N.O. & Ors 2013 (1) ZLR 69 (CC). To the extent that the applicant has submitted an application in terms of which its rights are likely to be affected, it has the locus standi. The decision in Metallon Gold dealt with the substantive issues in a corporate rescue application and did not deal with the procedural relief sought. The point should be dismissed.

ANALYSIS OF THE LAW AND THE FACTS

[69]	What constitutes locus standi in judicio at common law is a matter of settled law. See Law Society of Zimbabwe v Parliament of Zimbabwe & Ors CCZ 3/23, where Gowora JCC from para 39 succinctly put the legal position as follows:

[39] The starting point, in my view, is the courts’ approach to standing under the common law, which is stringent and restrictive. In general terms, under the common law, a litigant who approaches the court for relief must establish that he or she has a direct and substantial interest in the matter in question. To be properly before the court, such a litigant must show the infringement of some right or that his or her personal interests have been adversely affected, resulting in the litigant approaching the court for redress.

[40] Thus, a party must show that he or she has a direct, personal, and substantial interest in the matter in contention. In Zimbabwe Stock Exchange v Zimbabwe Revenue Authority SC 56/07, Malaba JA (as he then was) said:

“The common law position on locus standi in judicio of a party instituting proceeding in a court of law is that to justify participation in the action, the party must show that he or she has a direct and substantial interest in the right, which is the subject matter of the proceedings and the relief sought.”(my emphasis)

[41] Locus standi in judicio refers to one's right, ability, or capacity to bring legal proceedings in a court of law. One must justify such right by showing that one has a direct and substantial interest in the subject-matter and outcome of the litigation: see Zimbabwe Teachers Association & Ors v Minister of Education and Culture 1990 (2) ZLR 48 (HC). See also Dalrymple & Ors v Colonial Treasurer 1910 TS 372; Henri Viljoen (Pty) Ltd v Awerbuch Brothers 1953 (2) SA 151 (O); United Watch Diamond Co (Pty) Ltd & Ors v Disa Hotels Ltd & Anor 1972 (4) SA 409 (C); Deary NO v Acting President & Ors 1979 RLR 200 (G); SA Optometric Association v Frames Distributors (Pty) Ltd t/a Frames Unlimited 1985 (3) SA 100 (O); Molotlegi & Anor v President of Bophuthatswana & Ors 1989 (3) SA 119 (B).

[42] In Sibanda & Ors v The Apostolic Faith Mission of Portland Oregon (Southern African Headquarters) Inc SC 49/18, Hlatshwayo JA (as he then was) considered the principle of locus standi and stated the following:

“It is trite that locus standi is the capacity of a party to bring a matter before a court of law. The law is clear on the point that to establish locus standi a party must show a direct and substantial interest in the matter. See United Watch & Diamond Company (Pty) Ltd & Ors v Disa Hotels Ltd & Anor 1972 (4) SA 409 (c) at 415 AC and Matambanadzo v Goven SC 23-04.”

[43] In accordance with the general rule that the party instituting proceedings must allege and prove that he has locus standi, the onus of so establishing rests upon the applicant. Consequently, a litigant must show that he has the right or capacity to bring a matter to court and a right to appear in court. Locus standi is the other side of the coin to jurisdiction. It is incumbent therefore that the applicant establishes locus standi in judicio to invoke the jurisdiction of the court to exercise its power in its favour. See Mars Incorporated v Candy World (Pty) Ltd 1991 (1) SA 567 (AD) at 575 H.

[44] A party instituting legal proceedings of any nature must show that both he and the party being sued, in layperson’s terms, have a real interest in the matter being brought to court. A litigant must show his authority to sue or be sued and that the other party is one over which the court can exercise its jurisdiction. Any party instituting process in which relief is sought from the court is obliged to place itself as a party before the court seized with the dispute.”

[70]	It is clear from the above authority that the applicant must simply show that it has a direct and substantial interest in the matter. In other words, it would be affected by the court’s decision in the matter. The broad and generous approach to locus standi applicable to applications under s 85 of the Constitution, as set out in Mawarire and further from para 47 in Law Society of Zimbabwe supra, is not applicable to the present proceedings. These proceedings are not instituted in terms of s 85 of the Constitution.

[71]	The question is simply whether the applicant has the locus standi to institute the present application for an interdict. The submissions from the first respondent conflate the locus standi in the present application with that for an application for corporate rescue under s 121. The “affected persons” defined under s 121 relate to those who can make a court application for the placement of a company under supervision in terms of s 124(1). This is not an application for corporate rescue under s 124(1) of the Act. The decision in Metallon Gold relating to the locus standi of those who can apply for corporate rescue proceedings under s 124(1) as affected persons is not relevant or applicable to the issue of locus standi relating to the present proceedings. The cause of action outlined in the founding affidavit and the relief sought clearly show that this is an application sought in the context of the provision against the disposal of company property set out in s 127. The applicant seeks to interdict the company from proceeding with the disposal of its assets pending the determination of the application for corporate rescue. The arguments on lack of locus standi related to the main application for corporate rescue itself are accordingly not properly before me for adjudication. I cannot be called upon to determine the application for corporate rescue itself.

[72]	It was, therefore, misplaced for the first respondent to argue locus standi in relation to the application for corporate rescue filed in terms of s 124(1). That application is not before me. As far as the proceedings before me are concerned, the applicant clearly has the locus standi in judicio. It has a direct and substantial interest in the matter or would be affected by the outcome of the present proceedings. It is not in dispute that the applicant is the first applicant in the court application for corporate rescue filed against the first respondent in Case No. HCH 1945/25. Section 125(1)(b) is also clear that those corporate rescue proceedings commenced upon the filing of the application with the Registrar. This was further confirmed in the Metallon Gold case.

[73]	As the applicant in the main matter, whose application brought into effect corporate rescue proceedings and as such seeks to protect the company’s assets from being disposed of allegedly contrary to the Insolvency Act, it sought the interim relief in question. To the extent that the applicant seeks to give effect to the provisions of the Act, which it alleges have been violated by the intended disposals pending the determination of its application under r 124(1) clearly the applicant has the locus standi to institute the present proceedings and seek the relief it seeks. I, therefore, dismiss the point in limine of lack of locus standi for lack of merit.

ABSENCE OF NOTIFICATION BY STANDARD NOTICE

SUBMISSIONS ON THE POINT

[74]	It was argued for the first respondent that it is a mandatory requirement for the applicant to notify all affected persons by standard notice as required by ss 2 and 124 of the Act. The applicant’s failure to notify all the affected persons of its application under s 124(1) by standard notice renders the application a nullity. Mr Donzvambeva further argued that the applicant simply attached the list of names of what it purported to be affected persons. That list was not proof that those persons had been notified. The applicant admitted that it had not notified all affected persons, but related that to the chamber application for substituted service. The issue was dealt with from para 23 of the first respondent’s heads of argument.

[75]	Counsel further argued that the Supreme Court has already settled the issue in Metallon Gold and further clarified the same position in Redwing Mining Company (Pvt) Ltd v Associated Mine Workers Union of Zimbabwe & Ors SC 96/22. The failure by the applicant to notify affected persons of the current proceedings renders the application fatally defective.

[76]	Ms Mabwe submitted that the point relates to an application for the placement of the company under corporate rescue proceedings. It does not relate to an urgent chamber application. Those decisions in Metallon Gold and Redwing do not apply in relation to the urgent chamber application.

ANALYSIS

[77]	As I have already noted in relation to lack of locus standi, the first respondent raised the same point it raised in the main proceedings under Case No. HCH 1945/25. I cannot determine the application for corporate rescue proceedings. So, whether the application for corporate rescue under s 124(1) filed in Case No. HCH 1945/25 is valid for the alleged failure to serve the application on all affected persons by standard notice is not the issue before me. The legal position outlined by the Supreme Court in the Metallon Gold and Redwing cases is, therefore, not relevant or applicable to the present proceedings. The superior court in those judgments was dealing with an application for corporate rescue under s 124(1). The application before me is for an interdict in which the applicant is seeking to stop the disposal of the company’s property pending the determination of the corporate rescue application. The standard notice requirement under s 124(2)(b) as read with s 2 applies to an application for corporate rescue under s 124(1). Those mandatory provisions do not apply to govern the filing and service of the present application. The application before me is an urgent chamber application for an interdict filed in terms of r 60(1). There is no dispute that the application was served on all the respondents cited in these proceedings. The certificates of service filed of record clearly show this. The argument about complying with the mandatory requirements of s 124(2)(b) is accordingly misplaced. I dismiss the point in limine.

LACK OF AUTHORITY

SUBMISSIONS MADE ON THE POINT

[78]	The first respondent argued that the applicant and the deponent lack the authority to institute the present application. The basis of the argument is that under s 35(a) of the Labour Act [Chapter 28:01], the trade union is required to consult its members before assigning any official to represent its members in any matter of considerable significance to its members. The absence of consultation renders the proceedings unauthorised and, therefore, liable to be struck off the roll with punitive costs.

[79] 	Ms Mabwe, on the other hand, argued that in Annexure R02 at p 21, there is a resolution by the members. There is another board resolution at p 23 which empowers the deponent to act. The preliminary point must be dismissed.

ANALYSIS

[80]	The point was also raised in the application for corporate rescue under Case No. HCH 1945/25. In casu, the deponent averred in para 1.1 of the founding affidavit that the applicant is a registered trade union which represents employees of the first respondent. There is confirmation of that position from Annexure R02 signed by the said members. After filing the said corporate rescue proceedings, the applicant further filed the present application for an interdict stopping the company from disposing of its assets pending the determination of the main matter. To this application, a resolution of the national executive of the applicant is attached authorising the commencement of this application and the deponent, as the General Secretary, to sign the papers on behalf of the union. See p 23 of the record. Clearly, the applicant authorised the commencement of these proceedings. The resolution itself is very clear. The law on authority to commence or defend litigation on behalf of another was settled in Dube v Premier Services Medical Aid Society & Anor SC 73/19. In para 38, Garwe JA (as he then was), after reviewing several decisions, including those of this court, had this to say:

“The above remarks are clear and unequivocal. A person who represents a legal entity, when challenged, must show that he is duly authorised to represent the entity. His mere claim that by virtue of the position he holds in such an entity he is duly authorised to represent the entity is not sufficient. He must produce a resolution of the board of that entity which confirms that the board is indeed aware of the proceedings and that it has given such person the authority to act in the stead of the entity. I stress that the need to produce such proof is necessary only in those cases where the authority of the deponent is put in issue. This represents the current state of the law in this country.” (emphasis added)

[81]	Given the evidence from the record, the onus was on the first respondent to show that there were no consultations which took place as required under s 35(a) of the Labour Act. It simply made bald and unsubstantiated allegations that there were no consultations with the members in terms of s 35(a) of the Labour Act. In Dube v Murehwa SC 68/21 at p10, the Supreme Court aptly remarked as follows on the impact of failure to adduce adequate evidence to prove one’s claims:

“The law is clear that bald and unsubstantiated allegations do not establish a litigant’s purported or announced position. See Akhtar v Minister of Public Commission SC 173/97. …”

There was nothing to show that the deponent or the applicant lacked authority to sue as was done. The point was simply an attempt to make a mountain out of a molehill.

[82]	In any case, the applicant is already before the court in the main proceedings for corporate rescue. In the present proceedings, it merely seeks an order to interdict the first respondent from proceeding with the disposal of its assets pending the determination of the application for corporate rescue in terms of which it is already the first applicant. It cannot be said that the applicant has no authority to seek to enforce the provisions of the Act, which it alleges are violated if the disposals are permitted to go on before its own application for corporate rescue is heard. The deponent was also authorised as required by our settled authority from the Dube case. The argument is, therefore, completely baseless and frivolous.

[83]	This court has on numerous occasions stated that points in limine must only be raised where they are meritorious and capable of resolving the matter. They must never be raised as a matter of fashion. I fully associate myself with the words of Mathonsi J (as he then was) in Telecel Zimbabwe (Pvt) Ltd v POTRAZ & Ors 2015 (1) ZLR 65 (H) where he aptly said:

“I agree with Mr Girach that raising the issue of urgency by respondents finding themselves faced with an urgent application is now a matter of routine. Invariably when one opens a notice of opposition these days, he is confronted by a point in limine challenging the urgency of the application which should not be made at all. We are spending a lot of time determining points in limine which do not have the remotest chance of success at the expense of the substance of a dispute.

Legal practitioners should be reminded that it is an exercise in futility to raise points in limine simply as a matter of fashion. A preliminary point should only be taken where firstly it is meritable and secondly it is likely to dispose of the matter. The time has come to discourage such waste of court time by the making of endless points in limine by litigants afraid of the merits of the matter or legal practitioners who have no confidence in their client’s defence viz-a-viz the substance of the dispute, in the hope that by chance the court may find in their favour. If an opposition has no merit it should not be made at all. As points in limine are usually raised on points of law and procedure, they are the product of the ingenuity of legal practitioners. In future, it may be necessary to rein in the legal practitioners who abuse the court in that way, by ordering them to pay costs de bonis propiis.”

[84]	I found the points in limine raised by the first respondent in this case to be largely a regurgitation of the points raised in the main application for corporate rescue under Case No. HCH 1945/25 without due consideration of the nature of the present application before me. The respondent sought to make me pronounce a verdict in respect of the application, which is not even before me. Legal practitioners must be reminded to take court processes seriously and stop wasting the court’s time by simply raising points in limine which are utterly groundless and without any legal foundation. Otherwise, they may incur the wrath of the court for abusing it and ordered to pay costs de bonis propriis.

THE MERITS

SUBMISSIONS MADE BY THE PARTIES

APPLICANT’S SUBMISSIONS

[85]	Ms Mabwe submitted that the application is for an interdict pendete lite. The request is that the first respondent be stopped from dissipating its assets pending the determination of the main matter in Case No. HCH 1945/25. The requirements were set out in Flame Lily Investment Company (Pvt) Ltd v Zimbabwe Salvage (Pvt) Ltd 1980 ZLR 378, and these are a prima facie right, a reasonable apprehension of irreparable injury, no other ordinary remedy, and the balance of convenience.

[86]	On a prima facie right, it was submitted that the applicant is a creditor of the first respondent. There are dues which the first respondent must submit to the applicant which arise as a result of statute. The first respondent cannot adopt preferential treatment before the corporate rescue application is resolved. The applicant further makes an averment that the proceedings in Case No. 1945/25 were filed, the record consolidated, and the matter is awaiting the allocation of a set down date. The applicant’s right to a fair hearing ought not to be interfered with where the matter is ripe for hearing. In the cautionary statement at p 27, the first respondent acknowledged the fact that all papers had been filed. In such circumstances, where the first respondent acknowledges that corporate rescue proceedings have been pending, it cannot do what it intends to do.

[87]	Counsel further argued that the first respondent is approbating and reprobating. Cure Chem, one of the creditors, obtained a judgment against the company. It sought to execute, and the first respondent, through its legal practitioners, Coglan, Welsh and Guest, wrote to the creditor saying you cannot execute as s 126 sets in, and they stopped. You cannot, on one hand, argue s 126 while on the other hand, engage third parties to dissipate the assets. Under s 127, the property interests must be protected during corporate rescue proceedings. The rationale is set out in Metallon Gold that the CRP must inherit a company that can be revived, not a corpse. If one reads para 1 of the cautionary statement, we are not told which assets. The details are hidden in that statement.

[88]	On the irreparable harm, it was argued that the harm is not whimsical. It is real. The first respondent has indicated that it wants to dissipate mining assets. There is no other remedy to safeguard its rights. The balance of convenience favours the granting of the application.

FIRST RESPONDENT’S SUBMISSIONS

[89]	Mr Donzvambeva submitted that the merits of the matter are engaged in the heads of argument from para(s) 58-70. He further stated that he would abide by the contents of those submissions. Counsel went on to argue that there is no law which prohibits the first respondent from entering into and concluding the transactions to dispose of non-core assets to alleviate its financial situation. What the law prohibits under s 126 is the dissipation of company assets by creditors while corporate rescue proceedings are ongoing. In this case, the first respondent does not propose to dispose of the assets for no value. The words in s 126 are clear and unambiguous and ought to be given their ordinary meaning. They cannot be extended to the disposal of assets in the ordinary course of business to revitalise its operations.

[90]	Counsel further argued that the applicant also seeks to rely on s 127 in arguing that the first respondent must be stopped from proceeding with its transaction. That s 127, even when read together with s 126, does not outlaw the disposal of assets by the company while corporate rescue proceedings are pending. Sections 126 and 127 do not constitute a limitation on the first respondent’s constitutional right under s 71(2) of the Constitution to dispose of its property in any part of Zimbabwe. Section 127 only kicks in after a s 124(4)(a) and s 124(5) order has been made, placing the company under corporate rescue. This is because the company cannot seek the consent of a CRP to dispose of its property when no such practitioner exists.

[91]	It was also submitted that, assuming that the interpretation of s 127(1) above was wrong, s 127(1) itself under para (a)(i) provides that the company may dispose of or agree to dispose of its property during the ordinary course of its business. There is at the end of s 127(1)(a)(i) the word “or” which is generally accepted to be disjunctive in nature as opposed to “and”. Under s 127(1), there are three options under which the company may dispose of its property. Paragraph (b) to s 127(1), preceded by the word “and”, has no relevance to the proceedings before the court. The literal meaning which should be upheld is that the company is within its rights to dispose of its property in the ordinary course of business.

[92]	Mr Donzvambeva further argued that the requirements of an interdict have not been met. The applicant submits that it is a creditor of the first respondent. Nowhere in the founding affidavit is it averred that it is a creditor. It is neither a creditor nor an affected person in terms of the Act. There is no well-grounded apprehension of irreparable harm if the relief sought is not granted because the disposal will not necessarily prejudice it, as it is intended to benefit the creditors. The disposition is not meant to push it into liquidation but to keep it as a going concern. It is normal for a company to dispose of property not necessary for its future business. This is exactly what the applicant is doing. The court in exercising its discretion whether or not to grant the order it must do so to give effect to s 71(2) of the Constitution rather an approach where the first respondent’s board is disabled to pursue transactions meant to keep it as a going concern as there is no guarantee that the application for corporate rescue will be granted. The application ought to be dismissed with costs.

APPLICANT’S REPLYING SUBMISSIONS

[93]	In reply, Ms Mabwe submitted that the principle in our law is that a party cannot approbate and reprobate. At p 28, the first respondent says you cannot proceed against us because of corporate rescue proceedings and now says it wants to dispose of assets. This is disingenuous. It is the first respondent which raised the applicability of s 126 to other creditors; it must be bound by it. The cautionary statement does not specify which assets it wants to dispose of. There is a caveat under s 127(1) that it is subject to sections (2) and (3). The interpretation of s 127(1) is limited by what is provided under s 127(2). The disposition must be consented to by the CRP under s 127(2). One cannot tell if the property to be disposed of has been subject to judicial attachment. The exceptions under s 127 are not met.

[94]	Counsel further argued that there is an averment that the applicant is a creditor in para 6.2 of the founding affidavit. She also stated that she had not heard counsel for the respondent saying that the filing of the main application does not give the applicant the right to be heard in the determination of the matter. Once the proceedings under Case No. HCH 1945/25 have been instituted, the applicant has a prima facie right to be protected. She further argued that she did not hear counsel saying that if the assets are dissipated, there would be another way of reversing the ramifications of the disposal. The requirements for an interdict have been met. None of the parties will be prejudiced as the matter now awaits set down.

WHETHER OR NOT THE REQUIREMENTS FOR A TEMPORARY INTERDICT HAVE

BEEN SATISFIED.

ANALYSIS OF THE LAW AND THE FACTS

[95]	The requirements for an interim or temporary interdict are settled. These are:

(i)		a prima facie right, even if it be open to some doubt;

(ii)	a well-grounded apprehension of an irreparable harm if the relief is not granted;

(iii)	that the balance of convenience favours the granting of the interim interdict; and

(iv)	that there is no other satisfactory remedy:

See Setlogelo v Setlogelo 1914 AD 221 at 227; Flame Lily Investment Company (Pvt) Ltd v Zimbabwe Salvage (Pvt) Ltd & Anor 1980 ZLR 378, and Tribac (Pvt) Ltd v Tobacco Marketing Board 1996 (1) ZLR 289 (SC) at 391.

A PRIMA FACIE RIGHT

[96]	In Mayor Logistics (Pvt) Ltd v Zimbabwe Revenue Authority CCZ 7/14 Malaba DCJ (as he then was) put the legal position as follows:

“It is axiomatic that the interdict is for the protection of an existing right. There has to be proof of the existence of a prima facie right. It is also axiomatic that the prima facie right is protected from unlawful conduct which is about to infringe it. An interdict cannot be granted against past invasions of a right nor can there be an interdict against lawful conduct. Airfield Investments (Pvt) Ltd v Minister of Lands & Ors 2004 (1) ZLR 511 (S); Stauffer Chemicals v Monsato Company 1988 (1) SA 895; Rudolph & Anor v Commissioner for Inland Revenue & Ors 1994 (3) SA 771.”

It is trite that a prima facie right, though open to some doubt, must be established where an interim interdict is sought as opposed to a clear right in the case of a final interdict. The applicant had the onus to show the existence of a prima facie right in respect of the assets of the first respondent, which the first respondent is about to dispose of.

[97]	There is no dispute that the applicant is the first applicant in the proceedings for corporate rescue pending under Case No. HCH 1945/25. The effect of the filing of such a court application for corporate rescue in terms of s 124(1) of the Act has already been settled. Section 125(1)(b) is very clear that corporate rescue proceedings commence when the application to place the company under supervision is made by an affected person in terms of s 124(1). The position was further put beyond doubt in the Metallon Gold case, where at p 16 Malaba CJ had this to say:

“The mere filing of the application with the Registrar of the High Court, even before the merits of the application are considered, has the effect of commencing corporate rescue proceedings. The temporary moratorium regarding the suspension of the rights of creditors will therefore start at this stage. The law requires the protection of the troubled company’s assets so that corporate rescue practitioners do not inherit shells. This is an important change to the old regime.

In JVJ Logistics (Pty) Ltd v Standard Bank of South Africa Ltd and Ors 2016 (6) SA 448 (KZD) at 448 the court dealt with the moratorium on business rescue proceedings. The court held that:

“During business rescue proceedings, no legal proceeding, including enforcement action, against the company, or in relation to any property belonging to the company, or lawfully in its possession, may be commenced or proceeded with in any forum …”.

During a company’s corporate rescue, the company can only dispose of its assets in circumstances prescribed in s 127(1) of the Insolvency Act.” (emphasis added)

[98]	The mere filing of the court application for corporate rescue, despite bringing into immediate effect the general moratorium under s 126, also further imposes a moratorium against the disposition of company property under s 127. The rationale for the said moratoriums under ss 126 and 127 is, in my view, the same; they seek to protect the troubled company’s assets so that the CRPs do not inherit shells. The immediate commencement of corporate rescue proceedings means that it cannot be business as usual, given that the court would be expected to pronounce itself on the application.

[99]	In my view, while creditors cannot commence or proceed with any legal proceedings, including enforcement action against the company or the property belonging to it or lawfully in its possession under s 126, the provisions of s 127 are equally meant to protect the company’s assets during corporate rescue proceedings. Section 127 applies immediately upon the filing of the application as with s 126. When the court considers under s 124(4) whether or not to grant the application for corporate rescue, it looks not only on whether the company is financially distressed or has failed to pay over any amount due in terms of an obligation under or in terms of a public obligation or contract with respect of employment related matters or any other financial reasons making it just and equitable to grant the order but also whether there is a reasonable prospect for rescuing the company. The provisions of s 124(4) use the word “and” under para (a), which means that the court must also consider the prospects of rescuing the company. For the court to make such a determination, the company assets must not have been dissipated or stripped, as to do so would certainly defeat those proceedings.

[100]	The dissipation of the company’s assets may reasonably make the prospects of reviving the company very remote. It would also make the CRPs inherit shells if the court is inclined to grant the order placing the company under supervision. In that context, it is my view that ss 126 and 127 take immediate effect upon the filing of the application for corporate rescue under s 124(1). The company’s rights to deal with its assets would be curtailed and subject to the exceptions under s 127. This was also confirmed by the Supreme Court in Metallon Gold at p 16. I, therefore, do not agree with Mr Donzvambeva that s 127(1) would only take effect upon an order issued in terms of s 124(4)(a) as read with s 124(5).

[101]	The filing of the application for corporate rescue under s 124(1) in Case No. HCH 1945/25 automatically created a prima facie right to the applicant as the moratorium against the disposal of the company’s assets under s 127 immediately took effect. Section 125(1)(b), as confirmed by the Supreme Court in Metallon Gold, does not concern itself with the merits or otherwise of the application for corporate rescue. Once it is merely filed with the Registrar, s 127 is immediately brought into effect along with s 126, to protect the assets of the troubled company pending the determination of the application.

[102]	The disposals of the company’s property would certainly have an effect of seeking to render the pending application for corporate rescue academic, hence the provisions of s 127, which are meant to ensure that the purpose of those proceedings is not defeated. The applicant, accordingly, is entitled to seek that the provisions of s 127 be given effect. As averred in para 1.1 as read with para 6.2 of the founding affidavit, the applicant represents the interests of the first respondent’s employees who are owed various amounts in unpaid salaries, thereby representing the interests of the company’s creditors. It accordingly has a legal right to demand the preservation of the company’s property in terms of s 127. The application filed by the applicant, having brought into effect by s 127, entitles the applicant to seek the court’s protection for an infringement of such right arising from the contemplated dispositions.

[103]	Section 127 of the Act provides as follows:

“127. Protection of property interests

(1) 	Subject to subsections (2) and (3), during a company’s corporate rescue proceedings—

(a) 	the company may dispose, or agree to dispose, of property only—

(i) 	in the ordinary course of its business; or

(ii) 	in a bona fide transaction at arm’s length for fair value approved in advance and in writing by the practitioner; or

(iii) 	in a transaction contemplated within, and undertaken as part of the implementation of, a corporate rescue plan that has been approved in terms of s145; and

(b) 	any person who, as a result of an agreement made in the ordinary course of the company’s business before the corporate rescue proceedings began, is in lawful possession of any property owned by the company may continue to exercise any right in respect of that property as contemplated in that agreement, subject to s 129; and

(c) 	despite any provision of an agreement to the contrary, no person may exercise any right in respect of any property in the lawful possession of the company, irrespective of whether the property is owned by the company, except to the extent that the practitioner consents in writing.

(2) 	The practitioner may not unreasonably withhold consent in terms of subsection (1)(c), having regard to—

(a) 	the purposes of this Part; and

(b) 	the circumstances of the company; and

(c) 	the nature of the property, and the rights claimed in respect of it.

(3) 	If, during a company’s corporate rescue proceedings, the company wishes to dispose of any property over which another person has any security or title interest, the company must—

(a) 	obtain the prior consent of that other person, unless the proceeds of the disposal would be sufficient to fully discharge the indebtedness protected by that person’s security or title interest; and

(b) 	promptly—

(i) 	pay to that other person the sale proceeds attributable to that property up to the amount of the company’s indebtedness to that other person; or

(ii) 	provide security for the amount of those proceeds, to the reasonable satisfaction of that other person.” (emphasis added)

A disposition is defined under s 2 to mean

“the transfer or abandonment of a right to property and includes a sale, mortgage, pledge, delivery, payment, release, compromise, donation, suretyship, security interest under the Movable Property Securities Interest Act [Chapter  14:35] or any contract therefor”.

[104]	A clear reading of s 127(1)(a) above shows that during corporate rescue proceedings (which period would include from the time the application by an affected person is filed in terms of s 124(1)) the company may only dispose or agree to dispose of property if in terms of subpara (i) it is in the ordinary course of its business or under subpara (ii) or (iii) thereof. By the use of the word “or”, the provisions of the subpara(s) (i); (ii) or (iii) are disjunctive. While subsection (1) is subject to the provisions of subsection (2) and (3), what is clear is that under s 127(1)(a)(i) a company may dispose or agree to dispose of its property in the ordinary course of its business and for such disposition the consent of the CRP would not be required. That is one of the exceptions to the moratorium on disposal of company property imposed by s 127.

[105]	The applicant averred in its papers that the dispositions in terms of the cautionary statement of 21 July 2025 do not fall into any of the exceptions under s 127. On the other hand, the first respondent argued that the disposal of “some of the company’s mining assets and non-core assets” as stated in the cautionary statement was in the ordinary course of its business and permissible under s 127(1)(a)(i). I do not agree with the first respondent’s argument. This, therefore, calls for an interpretation of what a disposal “in the course of its business” would mean. This is not defined in the Act. A “disposal in the course of its business” generally has been defined to mean the sale or transfer of a company’s assets or property as part of its normal operations, rather than a one-off sale that is outside the usual activities of the company. In other words, it must be a transaction that qualifies to be a disposition under s 2 as part of the company’s ongoing business. In other words, the ordinary course of its business would mean the usual and regular activities that a company undertakes to generate revenue and operate its business. For example, a clothing retailer selling clothes would be considered a disposal in the ordinary course of its business. The Supreme Court of South Africa had an occasion to define the term “in the ordinary course of that business” in terms of s 34 of the Insolvency Act of 1936 in Gainsford NO and Others v Tiffski Property Investments (Pty) Ltd & Ors and Others 2012 (3) SA 35 (SCA) and stated the following:

“[26]	Tiffski asserted that the agreement of sale was entered into in the ordinary course of business. The appellants argue that if this is taken to mean that the transfer of the business of the company in terms of the written contract of sale was effected in the ordinary course of the business of the company – for this is what is hit by s 34(1) of the Act – such a contention is manifestly untenable, because the disposal by the company of all its assets (being the immovable property and the movable assets employed by the company in conducting its ski resort business) can by no stretch of imagination be said to be in the ordinary course of business.

[27]	The test to determine whether an activity was in the ordinary course of business of the seller was formulated as follows in Joosab v Ensor NO [1966 (1) SA 319 (A)]:

‘… The word “that” in the expression “in the ordinary course of that business” in sec 34 (1) introduces the necessity of an enquiry into the kind of business in question, and the usual or ordinary business transaction of a business of that kind, in relation to which the above test is to be applied. It follows that the test to be applied, to determine whether an alienation by a trader of goods forming part of his business was in the ordinary course of that business, is whether, having regard to all the circumstances, the alienation was one which would normally have been transacted by a solvent business man carrying on a business of that kind.’

[28]	In Ensor NO v Rensco Motors (Pty) Ltd this court had occasion to remark that:

‘[T]here are two elements in the critical phrase in s 34 (1): (i) “the ordinary course”, and (ii) “of that business”. Both are equally important in construing or applying the requirement; contrary to counsel’s argument, neither should predominate over the other; and, according to the above dicta in Joosab’s case, when these two elements are read together, they in substance and effect pose the objective test: “whether, having regard to all the circumstances, the alienation was one which would normally have been transacted by a solvent business man carrying on a business of that kind”.’ (emphasis added)

The phrase “in the course of its business” in s 127(1)(a)(i) would accordingly be accorded the meanings I have already pointed out above.

[106]	In casu, in para 14.3 of the applicant’s answering affidavit it was further averred that the primary business of the first respondent involves the extraction of various mineral ores and processing them into mineral products for sale and distribution. It is common cause that the first respondent is into mining as its core business. In its ordinary course of business, the company mainly sell gold to Fidelity Gold Refineries. It cannot be said to be in the business of selling some of its mining assets and non-core assets, as stated in the cautionary statement. As stated in para 1.2 of the founding affidavit, the company’s mining assets would include mainly Renco Mine in Masvingo, among others in Mashonaland West Province, as well as its other movable and immovable property. The sale of its mining assets or property, including non-core assets outside the sale of the minerals and mineral products themselves, which will have a material effect on the company’s balance sheet as stated in the cautionary statement, cannot, by any stretch of imagination reasonably be taken to be a sale in the ordinary course of the company’s business. That is not the kind of business the company is into.

[107]	Mr Donzvambeva submitted that the disposal of the assets is meant to revitalise the first respondent’s business or address its liquidity challenges. In para 61 of its opposing affidavit, the first respondent also gave the same reason for the disposals, that they are “designed to address the first Respondent’s liquidity challenges and remove the cause for any allegations of insolvency.” The cautionary statement itself relates to the disposal of “some of the company’s mining assets and non-core assets”. Clearly, the intended transactions are not disposals in the ordinary course of its business or disposals undertaken in the ordinary course of a business of that kind. The disposals cannot be what is contemplated by s 127(1)(a)(i).

[108]	 It is also clear from the first respondent’s papers, in particular the said para 61 of the first respondent’s opposing affidavit, that the first respondent seeks to undermine the court proceedings pending before the court. The effect of the law against the disposal of the troubled company’s assets is meant to preserve its assets to ensure that the efforts to revive the company may have reasonable prospects and that the CRPs do not inherit shells. The constitutional right set out in s 71(2) of the Constitution is clearly limited by s 127(1), which is a law of general application. It was not shown that the limitation does not meet the requirements of s 86 of the Constitution. In these circumstances, I am satisfied that the applicant has established a prima facie right which it seeks to protect through the interim order sought.

WELL-GROUNDED APPREHENSION OF IRREPARABLE HARM

[109]	I am also satisfied that the applicant established a well-founded apprehension of irreparable harm if the application is not granted. The ramifications of the disposal of the assets intended by the first respondent would be irreversible. As confirmed in para 61 of the first respondent’s opposing affidavit, the reason for the disposals is that they are “designed to address the first Respondent’s liquidity challenges and remove the cause for any allegations of insolvency.” The first respondent seeks to use the opportunity to defeat the purpose of the pending proceedings and preempt the court’s decision under the guise of dispositions of what is simply stated as “some of the company’s mining assets and non-core assets”. The exact extent of the dispositions is not disclosed, and the applicant’s fears of dissipation or stripping of the company’s assets to the prejudice of the applicant and other creditors are not whimsical.

[110]	The court was called upon by the applicant and the other applicants in Case No. HCH 1945/25 to exercise its discretion under s 124(4) to assess whether the applicant in that case  for either of the reasons under subpara(s) (i) to (iii) can be placed under supervision and whether there is a reasonable prospect for rescuing the company. Seeking to dissipate the assets of the troubled company before the court can consider the merits of the application would, in my view, cause irreparable prejudice to the applicant. That is exactly why s 127(1) was enacted to protect the company’s property interests.

[111]	In para 1.1 of the founding affidavit, it is averred that the applicant is also an affected person as it represents employees of the first respondent. While that is still subject to determination in the main matter, before me it was established that the trade union is an applicant in that pending matter. By the effect of the moratorium against dispositions of company property under s 127 brought into effect by the mere filing of the application in Case No. HCH 1945/25 proceeding with the transactions as contemplated would result in irreparable harm to the applicant’s right or interest it seeks to protect, and the cause of action therein would become academic and of no direct benefit to the applicant. The court must accordingly intervene to give effect to the provisions of s 127(1) of the Act.

NO OTHER SATISFACTORY REMEDY

[112] 	There is no other satisfactory remedy available to the applicant to give effect to s 127(1) of the Act. The interim interdict sought is meant to preserve the assets of the company pending the hearing of the application filed in terms of s 124(1). The assets cannot be dissipated outside the provisions of s 127(1), which has taken effect upon the filing of the application under Case No. HCH 1945/25.

THE BALANCE OF CONVENIENCE

[113]	It is not in dispute that the court application for corporate rescue is now ready for set down as the parties filed all their papers in that matter. The effect of the provisions of s 127(1) is meant to curb potential prejudice to the creditors and other affected persons and ensure that if the company is to be placed under the supervision of a CRP, it will have a reasonable chance to be revived. In these circumstances, I do not agree that there can be any prejudice to the first respondent that can outweigh that to the applicant if the application is not granted. The law under s 127(1) is currently effective.

[114]	I disagree that the order sought will halt the operations of the company in any way. The company is still permitted under s 127 to continue with its ordinary business pending the determination of the main matter. But as I found above, once the court issues an order under s 124(4)(a) and a further order under s 124(5), the board of directors will effectively be deemed dissolved by virtue of the provisions of s 130(2). The balance of convenience favours the granting of the provisional order and the preservation of the company’s property pending the return day.

DISPOSITION

[115]	The requirements for granting a temporary interdict have been satisfied, and I am satisfied that the legal remedy sought must be granted. The dispositions contemplated violate the provisions of s 127(1). The first respondent’s conduct seeks to frustrate and defeat the rationale of s 127(1) as well as undermine the pending corporate rescue proceedings in Case No. HCH 1945/25. The application has merit and must succeed.

[116]	Accordingly, it is hereby ordered as follows:

“INTERIM RELIEF GRANTED

Pending confirmation or discharge of this Provisional Order, the Applicant is granted the following interim relief:

The first respondent’s board be and is hereby interdicted and barred from proceeding with the contemplated transactions and actions contained in its cautionary statement published in the Herald Newspaper of 21 July 2025.

SERVICE OF PROVISIONAL ORDER

1. 	The applicant’s legal practitioners are hereby authorised to serve the provisional order on the respondents.”

Dembure J:   ………………………………………………

Zinyengere & Rupapa, applicant’s legal practitioners

Wintertons, first respondent’s legal practitioners