Artwell Maradha v Big Valley (Pvt) Ltd

On 1 November 2018, the parties entered into an agreement of sale wherein the applicant sold to the respondent a Ford Ranger "Wild Track" motor vehicle for US$40,000. The respondent paid US$5,000 as initial deposit and took possession of the vehicle. Over the following months, the respondent made further payments totaling US$20,500, leaving a balance of US$19,500. On 21 July 2019, the applicant seized the motor vehicle from the respondent. The respondent filed a spoliation application in the Magistrates Court. The parties disputed the sequence of events—the applicant claimed repossession was due to non-payment, while the respondent claimed it stopped payments because the applicant seized the vehicle. The applicant then approached the High Court seeking cancellation of the sale agreement. The respondent initially resisted but subsequently acceded to the cancellation. The dispute narrowed to the question of how the refund of US$20,500 should be denominated—whether in RTGS dollars at 1:1 with USD (as applicant argued) or in USD or its equivalent at the official rate (as respondent argued).

• Whether the obligation to refund the purchase price arose before or after the 'first effective date' as defined in section 20 of the Finance (No.2) Act, 2019
• The interpretation and application of section 22(1)(d) and (e) of the Finance (No.2) Act, 2019 to contractual obligations
• Whether the refund should be denominated in RTGS dollars at 1:1 parity or in United States dollars at the official exchange rate
• The determination of costs in light of the applicant's conduct and non-disclosure of material facts

The court ordered: (1) The agreement of sale for the Ford Ranger Wild Track (registration ADL 7497) is cancelled; (2) The applicant retains possession of the motor vehicle; (3) The applicant must repay US$20,500 or its equivalent in Zimbabwe dollars at the official rate within 14 days; (4) The applicant must bear costs of suit.

For purposes of section 22(1)(d) of the Finance (No.2) Act, 2019, an obligation to reimburse monies paid under a contract arises at the time of the contract's repudiation or collapse, not at the time when the original payments were made. Therefore, where a contract was repudiated after the first effective date (22 February 2019), the obligation to refund monies paid before that date must be discharged in the currency specified or at the official exchange rate applicable after the first effective date, not at the 1:1 RTGS dollar parity. A party who undertakes in court papers to repay a specific amount in a particular currency will be held to that undertaking and cannot subsequently seek to convert that obligation to a different currency basis.

The court observed that the applicant's deliberate failure to disclose material facts—particularly that he had already seized the motor vehicle before instituting the application yet sought an order for its surrender—constituted unconscionable conduct. The court noted that such misconduct, including the making of false statements, misleading the court, and failure to take the court into confidence, justifies departing from the general rule that costs follow the event. The court also observed that there was evidence suggesting the parties had agreed on a staggered payment plan until 31 August 2019, contrary to the applicant's assertion that full payment was due by 31 December 2018, lending credence to the respondent's version of events. The court referenced the general principle from Herbstein and Van Winsen regarding misconduct justifying special costs orders.

This case is significant in Zimbabwean jurisprudence for its interpretation of section 22 of the Finance (No.2) Act, 2019, particularly regarding the determination of when a financial obligation arises for purposes of currency conversion. The judgment clarifies that the critical date for determining whether section 22(1)(d) applies is not when payments were made, but when the obligation to refund arose. It establishes that an obligation to reimburse purchase price upon cancellation of a contract arises at the time of the contract's collapse (repudiation), not at the time of the original payments. The case also reinforces the principle that parties will be held to undertakings made in their court papers and demonstrates the court's willingness to impose adverse costs orders where there has been deliberate non-disclosure or misrepresentation of material facts. It distinguishes and applies the Zambezi Gas case in the context of contractual repudiation and reimbursement obligations.