Engen Oil Zimbabwe (Private) Limited (formerly Chevron Zimbabwe (Private) Limited) (formerly Caltex Oil Zimbabwe (Private) Limited) v Charlesdale Service Station (Private) Limited and Endakuvanhu Investments (Private) Limited

On 15 August 2000, the applicant (Engen Oil) and the first respondent entered into a 15-year lease agreement for a garage/filling station at 194 Main Street, Marondera, commencing 1 November 2000 and expiring 31 October 2015. The second respondent was appointed as the applicant's dealer on the site, responsible for marketing and selling the applicant's products and paying rentals to the first respondent on the applicant's behalf. On 1 October 2015, the second respondent gave notice terminating its agency contract with the applicant, which was accepted. On 12 October 2015, the first respondent sent notice terminating the lease agreement upon expiration on 31 October 2015. The applicant did not accept this termination. The first respondent leased the property to the second respondent to sell another brand of products. The respondents began removing the applicant's pumps and property from the premises, prompting the applicant to seek urgent interim relief.

• Whether the applicant established a prima facie right to interim relief based on the lease agreement
• Whether clause 5(c) of the lease agreement conferred a right of first refusal to the applicant
• Whether a valid lease agreement existed between the applicant and the first respondent
• Whether the requirements for granting an interim interdict were satisfied
• Whether the applicant would suffer irreparable harm if the interdict was not granted
• Whether the balance of convenience favoured granting the interim relief

The interim relief sought was granted with costs. The court ordered: (1) The first and second respondents to restore the applicant's fuel pumps and any other property removed from the premises at 194 Main Street, Marondera; (2) Pending resolution of arbitration proceedings, the respondents and anyone occupying through them were interdicted from conducting the business of a garage and filling station from the premises or occupying the kiosk, takeaway, forecourt, offices, toilets and showroom; (3) Costs of suit to be paid by the respondents.

The binding legal principles established are: (1) A right of first refusal contained in a lease agreement constitutes a prima facie right sufficient to ground an interim interdict; (2) For interim interdicts, the applicant must establish: (a) a prima facie right, (b) reasonable apprehension of irrepaable harm, (c) absence of satisfactory alternative remedy, and (d) that the balance of convenience favours granting relief; (3) In commercial contexts, damages may not constitute a satisfactory alternative remedy where the right being protected is the ability to continue trading operations; (4) Parties cannot deny the existence of a contract when their own conduct, including issuing termination notices, demonstrates acceptance and recognition of that contract; (5) The granting of an interim interdict lies in the judicial discretion of the court, which must consider the applicant's prospects of success and prejudice to third parties.

The court observed that in almost all contractual claims there is always the alternative remedy of damages for breach of contract, but the critical question is whether such alternative remedy is satisfactory in the circumstances. The court also noted that third parties who derive benefits from the applicant selling fuel and products in Marondera would be adversely affected by termination of services without adequate notice, suggesting a broader public interest consideration in maintaining established commercial operations during disputes.

This case is significant for Zimbabwean commercial law as it demonstrates the courts' willingness to protect contractual rights of first refusal in lease agreements and to grant interim interdicts to preserve business operations pending final determination. It illustrates the application of the four-part test for interim interdicts in the commercial context, particularly emphasizing that damages may not be a satisfactory remedy where the right being protected is the continuation of trading operations. The case also confirms that parties' conduct can be used to establish the existence and acceptance of contractual relationships, preventing parties from later denying agreements they have acted upon.