Andrew Murwisi v Harvest Global (Pvt) Ltd

The plaintiff leased business premises at No. 20 Nyanga Road, Rusape to the defendant for use as a betting shop and offices under a written lease agreement dated 18 January 2017, for a fixed term ending 28 February 2018. The monthly rent was US$4,000 per month (US$48,000 for the full year), which was paid in advance through the sale of a motor vehicle. The defendant also paid a US$4,000 good tenancy deposit. The defendant's occupation was predicated on obtaining an operating licence for a betting shop. The defendant never took physical occupation as it failed to obtain the required betting shop licence. Before the lease expired, the plaintiff was informed the lease would not be renewed. The defendant surrendered the keys to Binali, the plaintiff's nephew who operated an ecocash tuck shop at the premises. The plaintiff claimed US$32,000 in arrear rentals for the period March to November 2018, alleging the defendant failed to give written notice of non-renewal 3 months before expiry and retained the keys, creating fictional occupation. The defendant counterclaimed for refund of the US$8,451 deposit (later established as US$4,000), asserting it never occupied the premises and the lease terminated by effluxion of time.

• Whether the defendant owed the plaintiff US$32,000 in arrear rent after the lease expired
• Whether the lease continued beyond its fixed term due to failure to give written notice under clause 2.2 of the agreement
• Whether the defendant was in occupation of the premises (actual or fictional) after the lease expiry
• Whether the defendant was entitled to a refund of the good tenancy deposit
• The application of the parol evidence rule to the interpretation of the lease agreement
• The relevance of parties' conduct in interpreting contractual rights and obligations
• Whether the lease was consummated given the supervening impossibility of obtaining the operating licence

The plaintiff's claim was dismissed. The defendant's counterclaim was granted in the amount of US$4,000 together with interest at the prescribed rate of 5% per annum from 18 December 2018 to date of payment in full. The plaintiff was ordered to bear the costs of suit.

Where a lease agreement for specific authorized use (betting shop) is never consummated due to failure to obtain required regulatory approval (operating licence), and the tenant never takes actual occupation, the lease terminates by effluxion of time at the end of the fixed term despite technical non-compliance with contractual notice provisions. Fictional occupation based on retention of keys requires proof that keys were not surrendered to the landlord or his agent and that the landlord was denied access; mere assertion of key retention is insufficient. Extension provisions in a lease agreement (clause 2.3) cannot apply where there is no occupation to extend. Courts will interpret contractual rights and obligations by reference to the parties' conduct, particularly where there is ambiguity or where strict application of written terms would produce an absurd result inconsistent with the parties' actual dealings. A landlord seeking to forfeit a tenancy deposit must lay a legal foundation for such forfeiture; absent such foundation, the deposit must be refunded. Judicial admissions made during proceedings are admissible as proof of facts under s 36 of the Civil Evidence Act and need not be disproved by the opposing party.

The court observed that the plaintiff's approach was forensic and ignored the reality on the ground. The court noted that even if clause 5.1 (providing for two months' rent as deposit) were not overridden by clause 1.6 (defining deposit as US$4,000), the defendant would still not be entitled to US$8,451 as it failed to prove that amount was paid. The court commented that a person who presented himself as a strict adherent to lease terms selectively enforced those terms and ignored others, undermining credibility. The court noted that if the defendant truly still held the keys and the plaintiff was denied access, fictional occupation would continue to this day, yet there was no claim for holdover damages, demonstrating the inconsistency of the plaintiff's position. The court's emphasis on the importance of inspecting premises and enforcing lease terms suggests landlords have implied obligations of reasonable monitoring and enforcement.

This case is significant in Zimbabwean contract law for: (1) demonstrating the limits of the parol evidence rule and the importance of parties' conduct in interpreting contractual rights, particularly where there is ambiguity or non-compliance with written terms; (2) establishing that a lease predicated on obtaining regulatory approval may fail to be consummated where such approval is not obtained, leading to termination by supervening impossibility despite technical non-compliance with notice provisions; (3) illustrating that fictional occupation requires actual retention of keys and denial of access to the landlord, not merely technical retention of keys by a third party agent; (4) confirming that courts will reject contrived claims fabricated to justify retention of deposits where the underlying factual matrix does not support the claim; (5) applying principles of credibility assessment in cases with mutually destructive versions; and (6) demonstrating the effect of judicial admissions under s 36 of the Civil Evidence Act in civil proceedings.