Divvyland Investments (Pvt) Ltd v David Chiweza

On 30 August 2009, the defendant responded to a newspaper advertisement placed by Property Plus Realtors (Pvt) Ltd for a property at Stand number 12 Le Roux Drive, Hillside, Harare advertised for US$70,000. The defendant made an offer of US$68,000 which was accepted, with a US$15,000 deposit and the balance to be paid in monthly instalments of US$5,000. The defendant took immediate occupation and paid a total of US$56,900 towards the purchase price. The defendant requested a written agreement of sale to obtain mortgage finance to pay the outstanding balance. Despite paying a US$300 agreement fee on 4 December 2014, the plaintiff never prepared the written agreement. Instead, the plaintiff obtained a subdivision permit on 10 February 2015 and attempted to subdivide the property sold to the defendant. The plaintiff then alleged breach, cancelled the verbal agreement on 23 June 2017, and sought eviction and damages totaling US$58,800 for alleged rental arrears, claiming the purchase price was US$75,000 for only a portion of the property.

• What were the terms of the verbal agreement of sale between the parties?
• Whether the defendant breached the agreement of sale
• Whether the entire property or only a portion was sold to the defendant
• Whether the purchase price was US$68,000 or US$75,000
• Whether the plaintiff's cancellation of the agreement was valid
• Whether the plaintiff should be interdicted from subdividing the property
• Whether the plaintiff's failure to prepare a written agreement constituted breach
• Whether the subdivision permit obtained after selling the entire property was valid

1. The plaintiff's claim was dismissed. 2. The defendant's counter-claim was granted. 3. The plaintiff was ordered to prepare a written agreement of sale within 10 days reflecting: the sale of Stand 10830 Salisbury Township measuring 3033 square metres (the entire property); a purchase price of US$68,000; deposit of US$15,000 paid on 4 September 2009; total paid of US$56,900 including interest; and outstanding balance of US$14,384.01 to be paid through bank loan. 4. The subdivision permit SD/CR/15/14 dated February 2015 was declared null and void. 5. The plaintiff was ordered to pay the defendant's costs on the legal practitioner and client scale for both the main claim and counter-claim.

A party to a contract cannot rely on its own breach or wrongdoing as a foundation for a cause of action against the other party. Where a seller deliberately frustrates a purchaser's ability to perform by refusing to provide documentation necessary for the purchaser to raise funds (such as a written agreement needed for mortgage finance), the seller cannot subsequently claim breach and cancel the agreement. Contemporaneous documentary evidence such as receipts, correspondence, and reconciliations of account prepared by the parties and their agents can establish the material terms of a verbal agreement of sale. A subdivision permit obtained after an entire property has been sold to a purchaser is null and void, particularly where obtained without the purchaser's knowledge and in an attempt to resell portions of the already-sold property. An undated document has no evidentiary value.

The court made several notable observations: (1) that the trial was "a sheer waste of the court's time" which "should never have proceeded into trial at all"; (2) that the plaintiff's case was "riddled with inadequacies of evidence, manifestly illogical, pregnant with concessions favourable to the defendant, diametrically opposed to the documentary evidence, against the probabilities, wanting in credibility... and quite simply hopeless"; (3) that there was a possible conflict of interest in the plaintiff's legal practitioners representing both the plaintiff and the estate agent, though the court stated it would "say nothing about" this; (4) that the plaintiff's conduct demonstrated "greed" in attempting to subdivide and resell property already sold; and (5) that the court was "unable to place a premium on such deceit." The court also noted its puzzlement at "the source of the US$75,000" claimed as purchase price when there was "completely no documentary evidence" supporting that figure. The court described Brian Machengo as "a very poor witness indeed" who was "extremely evasive" and engaged in "ducking and diving" even under cross-examination, though acknowledging he made "multiple concessions in favour of the defendant."

This case is significant in Zimbabwean property law for several reasons: (1) it reinforces the principle that a party cannot found a cause of action on its own wrongdoing; (2) it affirms the illegality of selling proposed subdivisions without a subdivision permit, following X-Trend-A-Home (Pvt) Ltd v Hoselaw Investments (Pvt) Ltd 2000 (2) ZLR 348 (SC) and Chioza v Siziba 2015 (1) ZLR 252 (S); (3) it demonstrates that contemporaneous documentary evidence (receipts, correspondence, reconciliations) can establish the terms of a verbal agreement where there is no written contract; (4) it confirms that a seller cannot deliberately frustrate a purchaser's performance and then claim breach; and (5) it illustrates the court's willingness to award costs on the higher scale where litigation constitutes an abuse of process. The case also highlights the evidentiary weakness of undated documents and the adverse inference drawn when key witnesses (the company directors) fail to testify.