Gilbert Zvizhinji t/a Redcliff Earthmoving v Standard Chartered Bank Limited

The plaintiff operated a bulldozer hired to ZIMASCO for slag removal at $750 per hour for 11 hours daily, 7 days per week. The plaintiff held a personal account with the defendant bank and claimed there was an agreement allowing him to deposit cheques issued by ZIMASCO in favour of "Redcliff Earthmoving" into his personal account and withdraw immediately without the usual 14-day clearance period. On 7 August 1996, the bank rejected and reversed a cheque deposit from ZIMASCO made in favour of Redcliff Earthmoving, resulting in dishonoured payments to plaintiff's suppliers. The plaintiff alleged he could not service his bulldozer due to lack of funds, leading ZIMASCO to cancel their contract on 20 August 1996. The plaintiff claimed damages of $6,624,750 representing lost earnings over an alleged two-year contract period and damage to creditworthiness.

• Whether there was an agreement entitling the plaintiff to draw immediately on cheques issued by ZIMASCO deposited into his current account
• Whether the defendant breached any such agreement
• Whether the plaintiff suffered damages in the sum claimed or any amount as a result of the alleged breach
• Whether any damages suffered were within the contemplation of the parties
• Whether any damages were too remote
• Whether the plaintiff failed to mitigate damages
• Whether the plaintiff was entitled to interest on damages from 15 August 1996

The plaintiff's claim was dismissed with costs.

A plaintiff claiming the existence of a special banking arrangement allowing deviation from standard banking procedures bears the burden of proving such agreement on a balance of probabilities. Where a plaintiff fails to establish the existence of an alleged agreement, there can be no breach of that agreement and consequently no liability for damages flowing from the alleged breach. In damages claims, causation must be established - losses caused by independent factors (such as equipment breakdown) rather than by the defendant's conduct cannot form the basis of a successful claim. Bank officials must have actual authority to grant special mandates, and the absence of such authority negates the enforceability of any alleged agreement.

The court observed that the plaintiff displayed arrogance in his demeanor both in court and in correspondence, and that he sought to mislead the court by characterizing his bulldozer's breakdown as merely requiring routine servicing when documentary evidence showed serious mechanical failure requiring repair. The court noted approvingly that ZIMASCO had an established practice of assisting contractors with consumables (oil, diesel) which would be deducted from amounts due, suggesting the plaintiff could have avoided his difficulties had he communicated his problems to ZIMASCO. The judgment implicitly criticizes the plaintiff's failure to maintain copies of allegedly important contractual documents and his inability to explain why he did not simply request ZIMASCO to issue cheques in the name matching his existing mandate.

This Zimbabwean High Court case illustrates important principles regarding the burden of proof in contractual disputes with banks, particularly concerning special banking arrangements. It demonstrates that alleged special agreements permitting deviation from standard banking practices (such as immediate clearance of third-party cheques) must be clearly proven, and that bank officials must have actual authority to grant such variations. The case also highlights principles of causation in damages claims, showing that a plaintiff must establish a clear causal link between the defendant's alleged breach and the loss suffered. The judgment reinforces that losses caused by independent intervening factors (here, equipment breakdown) cannot be attributed to an alleged breach of contract.