Bulchimex GmbH Import-Export Chemikalien und Produkte Technoimpex Sofia Bulgaria JSC v Bulchimex GmbH Import Export Chemikalien und Produkte (Pvt) Ltd and Others

The first applicant (a German company) and second applicant (a Bulgarian subsidiary) owned immovable properties in Zimbabwe, including the Mount Pleasant property, the Avondale property, and the Glen Lorne property. They authorized Ivan Pantchev to sell the Glen Lorne property for $150,000, which was sold through Sarah Hwingwiri (second respondent), an estate agent. The sale proceeds were not remitted to the applicants. Sarah subsequently registered the first respondent company (a Zimbabwean entity with a name similar to the first applicant) on 14 September 2016 with herself and Ivan as directors. She produced various purported resolutions and authorizations claiming authority to manage and sell the applicants' properties. The Mount Pleasant property was allegedly sold to Rajendrakumar Jogi on 9 December 2013, with transfer registered on 22 November 2017. The applicants discovered this when their caretaker informed them of an eviction on 1 March 2018. The applicants filed the main application on 28 November 2016 and obtained an interim interdict on 2 December 2016 prohibiting respondents from dealing with the properties.

• Whether the respondents had proper authority to depose to affidavits on behalf of the first respondent company
• Whether the first respondent company had any ownership or legitimate claim to the applicants' properties
• Whether the documents and resolutions produced by Sarah Hwingwiri were authentic or fraudulent
• Whether the first applicant was the legitimate owner of the Mount Pleasant property until its transfer
• Whether the second applicant is the owner of the Avondale property
• Whether material disputes of fact existed that prevented determination on the papers

The court granted the final order in favor of the applicants with an amendment to paragraph 1, declaring: (1) Until 22 November 2017, the first applicant was the legitimate owner of the Mount Pleasant property (stand 295, Northwood Township 2 of Sumbeni, 116 Twickenham Road); (2) The second applicant is declared the owner of the Avondale property (Lot 12 of Lot 15 Block C of Avondale, Bath Mansions Flats, 32 Bath Road); (3) The first and second respondents are declared to have no ownership rights or interests in either property. The interim interdicts were confirmed.

A company resolution is a mandatory requirement for authorizing any person to depose to affidavits or take legal action on behalf of a company. A director cannot confer authority upon themselves merely by virtue of being a director - this requires a properly constituted board resolution. Where serious allegations of fraud and forgery are made and supported by independent evidence (particularly from persons whose names appear on the disputed documents), and the opposing party fails to respond to or challenge such allegations, those allegations are deemed admitted. A fraudulent act is a nullity from which nothing flows - it cannot transfer ownership or create valid legal rights. Courts will adopt a robust approach to resolve matters on the papers where apparent factual disputes are manufactured through fraudulent documentation rather than genuine disputes. The principle that what is not denied in affidavits is taken as admitted applies with particular force where the undisputed evidence reveals fraud.

The court made observations about the scheming and cunning nature of Sarah's fraudulent conduct, noting her attempt to create confusion by registering a company with a name deliberately similar to the first applicant's name. The court commented on the implausibility of three separate legal entities of different nationalities (German, Bulgarian, and Zimbabwean) holding a joint meeting and passing resolutions together, contrary to corporate governance principles and the laws governing each entity. The court observed that if the sale agreement with Jogi was genuine, the applicants would not have subsequently authorized Sarah to manage the Mount Pleasant property in December 2016, as it would already have been sold. The court expressed doubt about whether Ivan Pantchev was actually a director of the first respondent, given his complete silence throughout the proceedings. The court noted that whether the first applicant remains owner of the Mount Pleasant property depends on the outcome of subsequent applications HC 2974/17 and HC 11246/17.

This case is significant for establishing important principles regarding: (1) the strict requirements for company resolutions authorizing legal proceedings - directors cannot self-authorize; (2) the court's willingness to adopt a robust approach to resolve apparent factual disputes when evidence of fraud and forgery is clear; (3) the protection of foreign-owned immovable property in Zimbabwe against fraudulent schemes; (4) the importance of proper authentication of documents allegedly executed outside Zimbabwe; (5) the application of the principle ex turpi causa non oritur actio (nothing comes from fraud/illegality); and (6) the consequences of failing to respond to serious allegations in affidavits, which are deemed admitted. The case demonstrates the courts' vigilance against fraudulent schemes designed to divest foreign property owners of their assets through the creation of similarly-named corporate entities.