Genet Mining (Proprietary) Limited v Sheriff of Zimbabwe (2) Pungwe Mining (Private) Limited

### Preamble
Judgment No. SC 133/20
Civil Appeal No. SC 358/17 1
REPORTABLE (125)
---------


REPORTABLE	(125)

GENET     MINING     (PROPRIETARY)     LIMITED

v

SHERIFF     OF     ZIMBABWE     (2)     PUNGWE     MINING     (PRIVATE)     LIMITED

SUPREME COURT OF ZIMBABWE

GWAUNZA JA, PATEL JA & MAVANGIRA JA

HARARE: OCTOBER 5, 2017 & OCTOBER 16, 2020

D. Tivadar, for the appellant

T. Mpofu, for the second respondent

MAVANGIRA JA:	This is an appeal against the whole judgment of the High Court of Zimbabwe sitting at Harare dismissing an interpleader application.

The brief facts of the case are as follows. Sometime in May 2015 the second respondent, Pungwe Mining (Private) Limited (Pungwe Mining) (judgment creditor) obtained a judgment against Mbada Diamonds (Private) Ltd (Mbada Diamonds) (judgment debtor) under Case No. HC 3964/15. The judgment required Mbada Diamonds to pay to Pungwe Mining the sum of US$3 188 787.09 together with interest and costs. Pursuant to the judgment and the judgment debtor’s failure to satisfy the judgment, the second respondent instructed the first respondent, the Sheriff of Zimbabwe, to attach certain property belonging to the judgment debtor.

On 8 April 2016 the Sheriff of Zimbabwe placed under attachment certain movable property. It is common cause that the property was attached at No. 124 Venderburg, Msasa, Harare. This place was recorded by the Sheriff in his return of service as the judgment debtor’s place of business. However, what was clear was that the judgment debtor’s place of business in all the papers was Block C, Sam Levy’s Village, Borrowdale, Harare.

The property that was attached was listed as:

“1 x Bomag BW212D-40 Roller with Fleet Number RO09;

2 x XY Drill Rigs with Fleet Numbers DR14 and DR21

respectively;

1 x Volvo 150 KVA/TAD 720GE Containerised Generator with Fleet Number GS08; and

2 x 6m Containers, the contents of which are detailed in the schedules attached hereto as Annexure “A” and Annexure “B” respectively”

Consequent upon such attachment, the appellant claimed ownership of the property. The Sheriff then instituted interpleader proceedings on 26 April 2016.  The appellant filed its notice of opposition on 29 April 2016.  In its opposing affidavit the appellant averred that the property which was attached by the first respondent was its property. It argued that it imported the property in question on a temporary basis for the purposes of undertaking mining services at the Mbada Diamonds mine.

It was the appellant’s submission that from September 2011 until December 2014 another company, Smit Investment Holdings SA (Pty) Ltd which was trading as Gecko Projects, intermittently rendered contract mining and beneficiation services to Mbada Diamonds. In order to meet its contractual obligations to Mbada Diamonds, Gecko Projects engaged the services of a number of sub-contractors to assist it, among them the appellant, who was engaged to render drilling and mining services at the Mbada Diamonds mine.

The appellant averred that, at the time of its appointment as sub-contractor to Gecko Projects, the appellant was known as Gecko Mining (Proprietary) Limited, which name appears on the documents attached to its papers in support of its claim to ownership of the property that was attached. It further averred that it was for the purpose of undertaking the drilling and mining services that it had to export, from its South African operations, into Zimbabwe various items of machinery and equipment including the property that was attached by the first respondent.

In support of its claim to the property, the appellant also averred that the premises where the property was attached were not the second respondent’s place of business but belonged to one Mr Makuwarara, who was leasing the premises to Mr Shane Roberts. The appellant further averred that it was allowed by Mr Shane Roberts to utilise a portion of the leased premises as a storage facility pending an application to repatriate the said property to South Africa.

On the other hand, the second respondent disputed that the appellant owned the property in dispute. It averred that the property was imported into Zimbabwe by the judgment debtor and as such belonged to the judgment debtor. The second respondent submitted that the appellant failed to tender evidence to substantiate the allegations that the property was imported by it on a temporary basis.

According to the second respondent, the fact that there was a commercial invoice that was issued showed that the property was imported on a permanent basis and was therefore imported by Mbada Diamonds. It also averred that, if the property was imported on a temporary basis as alleged by the appellant, there should have been attached to the papers a ZIMRA document titled ‘Application for Temporary Import Privileges’ (ATIP). Without that ATIP and with the commercial invoice attached to the property, so the second respondent argued, the only conclusion is that the property was imported into Zimbabwe on a permanent basis and not temporarily as alleged by the appellant. Furthermore, as the invoice reflected Mbada Diamonds as the importer it followed that the property belonged to Mbada Diamonds, the judgment debtor. To buttress its stance that the property was imported on a permanent basis the second respondent relied on expert evidence with regard to the interpretation or implication of the importation and related documents.

It was also the second respondent’s contention that it was not privy to the alleged arrangement or relationship between the appellant and the judgment debtor. Furthermore, that companies of that stature would not enter into such extra-territorial transactions without a written and signed agreement. It concluded that the appellant’s failure to attach such an agreement resulted in “casting aspersions of doubt to the genuinity (sic) (genuineness) and sincerity of such an averment.”

Despite the allegation by the appellant that the property was not attached at the business premises of the judgment debtor, the court a quo found that the property was attached at the judgment debtor’s place of business. This was a significant finding by the court a quo. The court consequently proceeded on the basis that the property, having been attached at the judgment debtor’s place of business, was therefore in the possession of the judgment debtor. As a result, the court found, the appellant as the claimant had the onus to prove ownership of the property. After assessing the evidence placed before it, the court found that the appellant failed to prove ownership of the property in question. The court therefore dismissed the appellant’s claim to and for the goods attached.

The appellant was aggrieved by that determination and filed this appeal.

Although the appeal is premised on several grounds of appeal, it raises two issues for determination. The first issue is the question whether or not the court a quo erred in finding that the onus to prove ownership of the property lay with the appellant.

The law on interpleader proceedings in respect of onus of proof of ownership is settled. It is trite that where a party lays claim to the property attached, the onus is upon that person to prove ownership. This principle, as enunciated in a plethora of cases, was aptly captured in the case of The Sheriff of the High Court v Tiritose Consulting (Pvt) Ltd & Anor HH 347-15 where the court said the following:

“It is trite in our law that the claimant bears the onus of proving ownership of property claimed in interpleader proceedings. …. This above stated position is especially true when the property attached was in the possession of the judgment debtor at the time of its attachment. When, however, the property was attached whilst in the possession of the claimant the onus shifts.”

In Greenfield N.O. v Blignaut and Others 1953 (3) SA 597 at 598C the following was said:

“The claimant is as a general rule made the plaintiff, and the burden of proof rests upon him where the goods seized were at the time of seizure in the possession of the judgment debtor, possession being prima facie evidence of title. If, however, the claimant was in possession at the time of the seizure, the burden of proof may be upon the execution creditor, thus reversing the ordinary rule, and the execution creditor may be made plaintiff.”

The learned authors Silberberg and Schoeman in The Law of Property 2nd Ed. state at p134:

“Consequently the plaintiff in a vindicatory action bears the burden of proving his ownership, because the defendant’s possession creates a presumption of ownership in favour of himself. In interpleader proceedings, when the messenger of the court or deputy-sheriff interpleads after a movable thing has been attached at the instance of a judgment creditor whilst in the possession of the judgment debtor, the onus of proving his ownership would be on the third party who seeks to vindicate such movable. But if the movable is in the possession of such third party at the moment of attachment, the burden of proof will, as a result of the presumption of ownership arising from such possession, be on the judgment creditor.

In so far as the presumption of ownership is generally rebuttable it is essentially a rule of evidence rather than a rule of substantive law.”

(the underlining is mine)

In Bruce N.O. v Josiah Parkes and Sons (Rhodesia) (Private) Limited and Another, 1971 (1) RLR 154 GOLDIN J stated at 157 E-F:

“In this case, it is not disputed that the goods which were attached consist of movable property which was in the possession of the judgment debtor at the time of attachment. On these facts, the onus of proving ownership rests upon the claimant.”

He proceeded at 157 I:

“Possession is regarded with such significance that a person who is in possession of a movable thing is presumed to be the owner of it.”

It is thus settled that in interpleader proceedings a person claiming ownership of property that has been attached whilst it is in the possession of the judgment debtor has the onus to prove ownership thereof. In other words, if the property attached was in the possession of the judgment debtor or if the property was attached at the judgment debtor’s place, the claimant has the onus to prove that, although the property was in the possession of the judgment debtor, it belonged to him or her. However, where the property attached was not in the possession of the judgment debtor but was in the possession of the claimant, the onus shifts to the judgment creditor to prove that the property attached is the property of the judgment debtor. Thus the first inquiry in this case is who was in possession of the property when the first respondent attached it.

It is common cause that the property was attached at No. 124 Venderburg, Msasa, Harare, a place referred to as the judgment debtor’s place of business in the Sheriff’s return of service. The appellant in its opposing affidavit alleged that the place where the property was attached was not the second respondent’s place of business but belonged to one Mr Makuwarara who was leasing the property to Mr Shane Roberts. It argued further that it was then allowed to utilise the portion of the leased premises as a storage facility pending an application to repatriate the property to South Africa.  No evidence was led to prove that the place was not the judgment debtor’s place of business, besides the appellant’s mere say so. The appellant also failed to produce evidence to substantiate its claim that the place where the property was attached belonged to Mr Makuwarara who was leasing the property to Mr Shane Roberts.

The court a quo found that the appellant failed to place any evidence before it to demonstrate that the judgment debtor was not in possession of the property. In this appeal, Mr Tivadar, for the appellant, submitted that the court a quo misdirected itself by failing to find that the place where the goods were attached was not the judgment debtor’s place of business. He argued that the allegation that the property was not attached at the judgment debtor’s place of business was not disputed by the second respondent and therefore should be taken as being admitted. This argument ignores the fact that the return of service of the first respondent indicates that the goods were attached at the judgment debtor’s other place of business.

As aptly contended by the second respondent (judgment creditor) in the court a quo:

“3.1.1. 	Other than the above averments, there is nothing that has been placed before the Court that confirms the Claimant’s mere say so. The Claimant failed to furnish the following which would have put the Court into its confidence:

The existence of a Mr Makuwarara and his ownership of the property.

The existence of a Mr. Shane Roberts.

A copy of the lease between Mr. J. Makuwarara and the alleged

Mr Shane Roberts.

Proof of Claimant having entered into an arrangement as alleged

with Mr Shane Roberts.

Proof that an application was being made to Zimbabwe Revenue Authority for

the repatriation of the assets to South Africa.

3.1.2. Curiously, despite the absence of all the above, the Claimant nonchalantly avers

that the Judgment Creditor must bear the onus of proving that the property does not belong to the claimant.”

The law is clear that a return of service is prima facie evidence of what is contained therein. The authority for this proposition will be found in s 20 (3) of the High Court Act [Chapter 7:06] which reads:

“(3) The return of the Sheriff or a deputy sheriff or an assistant deputy sheriff or a person mentioned in subsection (2) of what has been done upon any process of the High Court shall be prima facie evidence of the matters therein stated.”

Also pertinent in this regard are the cases of Gundani v Kanyemba 1988 (1) ZLR 226 (S) and Wattle Company (Pvt) Ltd v Inducom (Pvt) Ltd 1993 (2) ZLR 108 (HC)).  The presumption, however, is rebuttable by clear and satisfactory evidence. See Gundani v Kanyemba (supra) at 229 E-F and also TM Supermarket (Pvt) Ltd v Avondale Holdings (Pvt) Ltd & Anor HH-327-14).

Thus, in casu, there was prima facie evidence that the property was attached at the judgment debtor’s place of business. The appellant, as claimant, therefore had the onus to prove that it was the owner of the goods attached. With regard to the first issue stated earlier, it is therefore my view that the court a quo did not err in finding that the onus to prove ownership of the property lay with the appellant. The question then arises whether the appellant rebutted the relevant presumption by clear and satisfactory evidence.

Thus arises the second issue for determination, viz. whether the appellant failed to prove its alleged ownership of the property that was attached. From the judgment of the court a quo, it is clear that the court made factual findings regarding ownership of the property. The mere say-so of the appellant is all that was placed before the court a quo in this regard. It found, in the circumstances, that the property belonged to the judgment debtor. It is a well-established principle of law that this Court as an appellate court will not interfere with the factual findings of a trial court unless the findings were grossly unreasonable. In Metallon Gold Zimbabwe v Golden Million (Pvt) Ltd SC-12-15, the Court stated:

“It is settled that an appellate court will not interfere with factual findings made by a trial court unless those findings were grossly unreasonable in the sense that no reasonable tribunal applying its mind to the same facts would have arrived at the same conclusion; or that the court had taken leave of its senses; or, put otherwise, the decision is so outrageous in its defiance of logic that no sensible person who had applied his mind to the question to be decided could have arrived at it.”

From a perusal of the papers, there are two categories of assets involved. The distinction arises from the fact that the appellant only attached documents relating to the Bomag BW212D-40 Roller. With regard to the rest of the attached property, absolutely no documentation was attached to support the averments made by the appellant. With regard to this latter category, the appellant stated:

“6.5.5.2. The Claimant at this stage is unable to place before the Honourable Court the export documentation relating to the items listed in Annexure “A” and Annexure “B” as the Claimant has been unable to locate same despite its best endeavours. I do however claim that these assets all belong to the Claimant.”

Without much or further ado, it goes without saying that before the court a quo the appellant was not in a position to prove that the property did not belong to the judgment debtor and that it in fact belongs to it. The court a quo cannot therefore, in the circumstances, be said to have fallen into error. Nothing was placed before the court to establish the appellant’s claim that it has title to the attached goods. It is an elementary principle that an applicant must stand or fall by his or her or its founding affidavit. See Zimbabwe Electricity Transmission and Distribution Company v Ruvinga SC 20/13; Cosmos Cellular (Pvt) Ltd v PTC 2004 (2) ZLR 176 (S).

As regards the Bomag BW212D-40 Roller the appellant placed before the court a quo documents that it alleged to be export documents from South Africa. The appellant alleged that the property was imported into Zimbabwe temporarily.

The contention of the second respondent was that the Zimbabwe Revenue Authority regulations that regulate the importation of property on a temporary basis provide that when one wants to import property on a temporary basis, one must attach an “ATIP”. Its contention was that as the documents filed do not contain this “ATIP” it followed that the goods were imported permanently into Zimbabwe. The court a quo found that in terms of these documents the property was imported into Zimbabwe permanently and not temporarily as alleged by the appellant. The error of the court a quo in making such a finding on the facts placed before it is not shown.

The court also accepted the evidence and contention of the second respondent and found that according to ZIMRA regulations, when one is importing goods into Zimbabwe on a temporary basis, a commercial invoice is not required. It is only required where goods are being imported permanently. It found that the documents filed of record show that a commercial invoice was issued thereby indicating that the goods were not imported into Zimbabwe on a temporary basis but were in fact imported permanently. The court’s finding cannot be said to be outrageous or illogical.

The court a quo rejected the contention by the appellant that it imported the goods into Zimbabwe in circumstances where it was agreed with the judgment debtor that the latter would pay duty and do all clearance formalities before the appellant assumed control of the goods. The court found that the documents filed did not support that contention. It is important to note that although the parties relied on the evidence of expert witnesses, the court a quo found the evidence adduced by the second respondent to be more reliable.

The effect of the appellant’s version is that it shipped its assets in the name of Mbada Diamonds with an arrangement for Mbada Diamonds to clear them after which the appellant would collect the goods from Mbada Diamonds and it would then proceed to carry on its activities as a subcontractor. There was no explanation of the legal relationship between the appellant and Mbada Diamonds that would have predicated such an arrangement. These are averments which the appellant could have obtained confirmation on from Mbada Diamonds but it opted not to.

From the evidence and the documents filed of record, the second respondent managed to prove on a balance of probabilities that the goods attached (with particular reference being made here to the Bomag BW212D-40 Roller) belonged to the judgment debtor, Mbada Diamonds. The goods were imported by Mbada Diamonds as shown by the invoices attached. The allegation by the appellant that it instructed Mbada Diamonds to do all clearance formalities on its behalf was not accepted by the court a quo. The court a quo concluded and found that Mbada Diamonds was the owner of the attached goods, the Bomag BW212D-40 Roller included. In the absence of any supporting evidence, the court a quo cannot be faulted for finding against the appellant in so far as the Bomag BW212D-40 Roller is concerned.

On a holistic consideration of the matter with regard to all the attached property, the following is apparent. The appellant did not attach any supporting documentary evidence which would support or substantiate its averments and contention as to the alleged role of Mbada Diamonds in the importation of the property into Zimbabwe. In the absence of Mbada Diamonds in the proceedings a quo it would be remiss of this Court to fault the findings made by the court against the appellant with regard to its unsubstantiated averments on this aspect.

The appellant’s notice of opposition a quo did not have attached to it any evidence of any application for repatriation of the attached items to substantiate its claim in that regard. If such application was not made, there is no explanation for the failure or delay in so doing. There is no indication as to how long the property had been kept at the premises before it was attached. Affidavits by Makuwarara and Roberts would have also assisted in supporting the appellant’s claims. As indicated earlier, these were not availed in order to assist in the determination of the appellant’s claim to ownership. Evidence of the alleged agreements and or arrangements with Makuwarara and Roberts would have also assisted the appellant’s claim. Without any substantiation of the averments they remain bald averments in contradistinction to the presumption operating against the appellant by virtue of the property having been attached while at the judgment debtor’s place of business. The onus being on the appellant to prove its ownership of the property, it was incumbent upon it to not merely make averments but to substantiate the same with a view to establishing its case by clear and satisfactory evidence.

In (1) Smit Investment Holdings SA (Proprietary) Limited (2) Genet Mining (Proprietary) Limited v (1) The Sheriff of Zimbabwe (2) Pungwe Mining (Private) Limited SC 33/18 (Smit Investment) this Court was faced with somewhat similar facts and issues. The judgment creditor is the same in both matters. The judgment debtor in both matters is the same, being Mbada Diamonds. In the Smit Investment matter, the issue of proof of ownership similarly arose. The issue of proof of ownership by the claimant (appellant) was also central to the resolution of the dispute as in casu. The appeal in that matter was allowed.

There is a crucial difference in the facts of the two matters. The difference is aptly captured in the following paragraphs from the Smit Investment judgment at pp 10 and 11 respectively:

“The appellants produced documents which show that the assets had been purchased by them and initially belonged to them. They also produced the agreements concluded with Mbada Mine in 2012 and 2015 which show that ownership was reserved in favour of the appellants until the full purchase price was paid.

…

In the result I am amply satisfied that the appellants have proved on a preponderance of probabilities that they are the owners of the assets in question. It was incorrect and a misdirection for the court a quo to have relied so heavily on the aspect of importation as that aspect does not assist in the determination of ownership in the assets in question. The agreements produced by the appellants show that ownership in the assets would remain with them until the relevant purchase prices were paid in full, and such payments clearly did not take place.”

In casu there were no such agreements in terms of which the attached items had earlier been sold by the appellant to the judgment debtor, albeit subject to a suspensive condition as was the case in Smit Investment. To determine this appeal on the same basis as in the Smit Investment matter would in effect amount to importation of facts or evidence from that case into the present matter. That would be impermissible as it is trite that each case is decided on its own merits.

As noted from the case authorities, the appellant had to prove its ownership of the goods on a preponderance of probabilities. The court a quo found that it had failed to discharge the onus on it. It pointed to the deficiencies that resulted in such failure. Such deficiencies have been related to and pointed out above. The error of the court a quo has not been established. In the absence of such error this Court, as an appellate court, has no justification for interfering with the judgment of the court a quo.

Taking into account that the goods were attached at the judgment debtor’s place of business and that the appellant (claimant) failed to prove ownership of the property, it follows that the claimant’s claim must be dismissed. The appellant failed to prove that it had possession or that it was the owner of the property. The appellant thus failed to disprove the creditor’s averments that the property belonged to the judgment debtor. The result was therefore that the goods belonged to the judgment debtor and the court a quo rightly dismissed its claim.

The appeal is therefore devoid of merit and must be dismissed. The principle that costs will follow the cause will apply, there being no justification proferred for departing from it. The appellant has failed to establish a basis for the interference by this Court with the judgment a quo.

It is accordingly hereby ordered as follows:

The appeal is dismissed with costs.

GWAUNZA JA:			I agree

PATEL JA:			I agree

Kantor & Immerman, appellant’s legal practitioners

Dube Banda-Nzarayapenga, 1st respondent’s legal practitioners

Mhishi Legal Practice, 2nd respondent’s legal practitioners