Dynamit Security Organisation (Pvt) Limited v Mr H E Grimm and Heywood Haulage & Investments and International Truck Sales (Pvt) Ltd

The plaintiff security company contracted with the defendant company to provide security guard services at the defendant's industrial premises. The written contract included standard conditions, including Clause 6 which restrained the defendant from engaging any of plaintiff's employees during the contract period or within twelve months thereafter. While the contract was subsisting, the defendant cancelled it by letter without giving one month's notice as provided in the agreement. The defendant subsequently employed two of the plaintiff's guards who had previously worked at the defendant's premises. One of these guards had been stationed at another client's premises (Govan's of Norton), which was subsequently broken into after the guard deserted his post. The plaintiff sued for damages totaling $312,553.40, comprising: (a) unpaid invoices and damages for breach of contract ($12,553.40), and (b) $300,000 for breach of contract, which included training costs for replacement guards, losses arising from the theft at Govan's premises, and consequential losses from the defendant's employment of the two guards. The defendant contended that the cancellation was justified due to various breaches by the plaintiff, including guards being suspected of pilfering and failure to dispatch or supervise guards properly.

• Whether the defendant's cancellation of the security contract was justified based on alleged breaches by the plaintiff
• Whether the defendant breached the restraint of trade clause (Clause 6) by employing the plaintiff's former guards
• Whether the defendant was bound by the standard conditions of the contract despite not having had specific attention drawn to them
• Whether the damages claimed by the plaintiff were too remote to be recoverable
• Whether the damages claimed were general damages (flowing naturally from the breach) or special damages (requiring express pleading and proof of contemplation)
• Whether the plaintiff properly pleaded and quantified its claim for damages

Plaintiff's claim dismissed with costs

The binding legal principles established are: (1) A party who signs a contract containing a reference to standard conditions is bound by those conditions, even if they were not specifically drawn to their attention or were not read, applying the principle of caveat subscriptor. (2) A contract requiring utmost good faith (uberimae fidei), such as a security services contract, may be terminated immediately without notice where the breaches go to the root of the contract, particularly where the service provider's agents are suspected of dishonesty or theft. (3) For damages to be recoverable for breach of contract, they must have been within the reasonable contemplation of the parties at the time of contracting. Special or extrinsic damages are only recoverable if, in the special circumstances attending the conclusion of the contract, the parties actually or presumptively foresaw that such damages would probably flow from the breach. (4) In determining what parties contemplated, the court must examine the subject matter and terms of the contract itself and the circumstances known to both parties at the time they contracted.

The court made several non-binding observations: (1) It noted that the plaintiff's pleadings were poor and that the manner of pleading the damages claim was bad, making the declaration excepable (open to exception). (2) The court observed that despite the poor pleading, the matter had been referred to trial on issues set out in the pre-trial conference minute. (3) The court commented that it seemed unlikely, given the convivial atmosphere in which the contract was concluded between acquaintances, that the parties would have scrutinized the standard conditions document in detail. (4) The court noted that the defendant had indicated preparedness to pay another claim of $9,918, though this was not part of the final order. (5) The court observed that the plaintiff's basis for claiming the $300,000 became clear only during evidence (that a guard deserted his post at Govan's premises leading to theft), illustrating the inadequacy of the pleadings.

This case is significant in Zimbabwean contract law (which shares common heritage with South African law) for several reasons: (1) It affirms the principle of caveat subscriptor - that a party who signs a contract is bound by its terms, including referenced standard conditions, even if they claim not to have read them or had specific attention drawn to them. (2) It establishes that contracts requiring utmost good faith (uberimae fidei), such as security contracts, may be cancelled immediately where breaches go to the root of the contract, without requiring notice. (3) It applies and clarifies the distinction between general and special damages in contract law, emphasizing that special damages must be within the reasonable contemplation of the parties at the time of contracting. (4) It demonstrates the importance of proper pleading in claiming damages - vague or poorly structured claims may fail even if some breach occurred. (5) It addresses the principles of remoteness of damages in contractual claims, limiting recovery to damages that were reasonably foreseeable.