Aguy Clement Georgias & Another v Zimbabwe Development Bank Financial Services Limited

On 17 December 1996, the High Court granted a consent judgment against the appellants in favor of the respondent for $4,351,269.77. After the appellants' attempts to rescind the judgment failed (including an unsuccessful appeal to the Supreme Court in SC-138-98), execution commenced and property was attached. To stay the sale in execution of immovable property, the appellants arranged for Commercial Bank of Zimbabwe (CBZ) to provide an irrevocable bank guarantee. The guarantee, signed by Gideon Gono on behalf of CBZ on 15 April 1999, was for $5,860,690.35 plus interest at 40% per annum from that date. This figure included the original judgment debt, accrued interest, costs, disbursements, and auctioneer's charges up to 15 April 1999. On 14 June 1999, the respondent demanded and received payment under the guarantee. On 12 January 2000, the appellants filed an application claiming they had overpaid $739,688.18, contending that the guarantee amount was inserted in error and should have been limited to the original judgment debt of $4,351,269.77.

• Whether there was an overpayment made by the appellants to the respondent
• Whether the appellants satisfied the requirements for a condictio indebiti claim
• Whether the amount stated in the bank guarantee ($5,860,690.35) was inserted in error
• Whether the appellants were entitled to recover the alleged overpayment

The appeal was dismissed with costs.

For a condictio indebiti claim to succeed, the claimant must establish that: (1) there was an actual overpayment, and (2) all the requirements of the condictio indebiti are satisfied. Where a bank guarantee is provided to secure the full amount due under a writ of execution (including the original debt, accrued interest, costs, and other charges), the guaranteed amount represents the total indebtedness at that date, not merely the original judgment debt. A party claiming that the guaranteed amount was inserted in error must prove what the actual amount due was at the relevant date; absent such proof, no overpayment can be established. The person who executed the guarantee and negotiated its terms is a crucial witness in any claim alleging error in the guaranteed amount.

The Court noted that the High Court's exposition of the requisites of a condictio indebiti was lucid and need not be repeated, referring to the judgment in Aguy Clement Georgias & Anor v ZDB Financial Services Limited HH-235-2000. The Court also observed that the application could have been dismissed solely on the basis that no overpayment had been established, even before testing the claim against the requirements of the condictio indebiti.

This case clarifies the application of the condictio indebiti principle in Zimbabwean law, particularly in the context of payments made pursuant to bank guarantees. It establishes that parties claiming overpayment must prove not only that an error occurred but also the actual amount due versus the amount paid. The case demonstrates that where a guarantee is given to secure the full indebtedness under a writ of execution (including interest, costs, and other charges), the guaranteed amount cannot later be challenged on the basis that it should have been limited to the original judgment debt alone. The case also emphasizes the importance of evidence from key witnesses (such as the person who executed the guarantee) in establishing claims of error.