Enos Marimo v Mr Brancos and Brancos Panel Beaters (Private) Limited

The first defendant operated a panel beating business and was a used car dealer. In April 1997, the plaintiff purchased a Toyota Hilux pick-up from the first defendant for $90,000. The first defendant had previously purchased the vehicle from a Mr N. Keown. The plaintiff paid the purchase price and took delivery. On 3 November 2000, when the plaintiff attempted to sell the motor vehicle at public auction, it was impounded by the Department of Customs and Excise who demanded outstanding import tax and surtax totaling $254,053.51. The plaintiff informed the first defendant, but the defendant did not intervene. On 9 July 2001, the plaintiff paid the import duty and surtax, as well as storage charges of $24,757.70 and $3,968.65 for a new battery to secure release of the vehicle. The defendants refused to reimburse the plaintiff.

• Whether the first defendant, as seller and car dealer, was under an implied contractual duty to sell and deliver the motor vehicle free from any encumbrance
• Whether there was a duty on the seller to intervene on plaintiff's behalf after the motor vehicle was impounded by the Department of Customs and Excise
• Whether the defendants are liable to reimburse the plaintiff for amounts paid to secure release of the motor vehicle
• Whether the defendants have any valid defence for refusing to reimburse the plaintiff
• Whether the plaintiff was required to put up a virilis defensio against the Department's claim

The plaintiff's claim was dismissed with costs.

In a contract for the sale of a motor vehicle by a car dealer, it is a tacit term of the contract that the vehicle is sold free from encumbrances, including outstanding customs duties, such that the purchaser need only pay the agreed purchase price to obtain full ownership. A seller has a duty to intervene on behalf of a purchaser when a third party makes a sustainable demand that threatens the purchaser's possession or ownership (warranty against eviction), and this duty arises whether or not legal proceedings have been commenced. However, a purchaser who faces eviction must put up a virilis defensio (reasonable defence) where the third party's claim is not unassailable. Failure to mount such a defence when the means to do so are available, particularly when based on statutory protections, will defeat the purchaser's claim against the seller for reimbursement of amounts paid to the third party.

The court observed that it would be hazardous to lay down a general principle regarding freedom from encumbrances applicable to all types of property sales, as encumbrances may be of many different kinds and their nature equally varied. The court noted that in some cases, whether property is free from encumbrances will depend on the specific facts. The court also commented that the warranty against eviction generally does not apply where dispossession results from criminal activity such as theft, as such activity falls outside the scope of the warranty. The court disagreed with the broad proposition that the warranty against eviction can only apply where eviction is lawful, noting that it is the lawfulness or otherwise of the eviction that is tested by the seller's intervention or the purchaser's defence.

This case clarifies important principles in Zimbabwean (and by extension South African) contract law regarding: (1) the distinction between terms implied by law and tacit terms implied from the parties' common intention; (2) the scope of implied warranties in sale of goods contracts, particularly regarding freedom from encumbrances; (3) the seller's duty to intervene under the warranty against eviction, which arises not only when legal proceedings are commenced but also when sustainable demands are made; and (4) the purchaser's corresponding duty to put up a virilis defensio (reasonable defence) when the third party's claim is not unassailable. The case demonstrates that even where a seller breaches implied contractual duties, a purchaser who fails to mount a reasonable defence when able to do so cannot recover damages.