Dexprint Investments v Ace Property & Investments (Private) Limited and Others

Applicant (Dexprint Investments) purchased shares from the first respondent (Ace Property & Investments) in Carey Farm (Private) Limited for $140,000,000 on 5 February 2002. The agreement required payment of $14,789,000 before signing, $56,208,000 upon execution, and the balance of $69,000,000 plus 5% monthly interest by 28 February 2002. The company's only asset was Herons Gill farm (89.2623 hectares). Applicant fell into arrears, failing to pay the $56,208,000 on the signing date. First respondent gave notice on 13 February 2002 (hand-delivered at noon) requiring breach to be remedied within 14 days per Clause 10 of the agreement. On 28 February 2002, first respondent purported to cancel the agreement and sold the property to third respondent (Valuequest Investments) on 1 March 2002. Transfer to third respondent had been completed by the time of this application.

• Whether adequate notice was given by first respondent before cancelling the agreement of sale in terms of Clause 10 of the contract
• Whether the cancellation of the agreement on 28 February 2002 was valid and effective
• How to calculate the 14-day notice period prescribed in the contract when the notice was hand-delivered
• Whether the plea of lis alibi pendens applied due to a similar pending case (HC 5194/02)
• Whether there was a genuine dispute of fact requiring referral to trial
• What remedies were available given that the third respondent's purchase had been fully executed with transfer completed

The court found that the first respondent breached the agreement of sale with the applicant. The issue of damages for breach of contract was referred to trial. The applicant's main prayers for declaratory relief and specific performance were implicitly denied given that the matter was referred to trial only on the issue of damages.

When calculating a notice period under a contract where a hand-delivered notice is deemed received 12 hours after delivery (excluding weekends and public holidays), the notice period begins to run from midnight following the delivery. A notice hand-delivered at noon on a particular day is deemed received after midnight of that day, and any specified number of days thereafter must be calculated excluding Saturdays, Sundays, and public holidays as stipulated in the contract. A purported cancellation of a contract based on a notice period that has not fully expired is premature and of no force or effect, constituting a breach of contract by the cancelling party. Where the subject matter of a sale has been transferred to a third party and that transaction has been fully executed, the appropriate remedy for breach of the original contract is damages rather than specific performance or setting aside the subsequent transfer.

The court made observations regarding the plea of lis alibi pendens, noting that while the requirements were laid down in cases such as Mhungu v Mtindi 1986 (2) ZLR 171 (SC) and Nield v UDC Ltd 1989 (2) ZLR 142 (SC), the issue became moot once the earlier action (HC 5194/02) was formally withdrawn. The court also observed that the question of which agreement takes precedence (between applicant and first respondent versus first and third respondent) does not arise once it is established that the first respondent breached its agreement with the applicant. The court noted that respondents failed to substantiate their claim that there was a dispute of facts requiring referral to trial, finding that the matter was clearly capable of being resolved on the papers as to liability.

This case is significant in Zimbabwean contract law for its interpretation of contractual notice provisions, particularly regarding the calculation of notice periods when hand-delivered notices are involved. It demonstrates the strict approach courts take to compliance with contractual notice requirements before a party can validly cancel an agreement. The case also illustrates the principle that where specific performance has become impossible due to completed transactions with third parties, the remedy is damages rather than setting aside subsequent transfers. It reinforces the importance of precise compliance with contractual timelines and notice procedures in commercial transactions.