Guoxing Gong v Mayor Logistics (Private) Limited and the Registrar of Deeds

Mathonsi Family Enterprises (Pvt) Ltd was the registered owner of immovable property known as number 9 Simon Mazorodze Road. Lacking financial capacity to subdivide the property, it entered into a verbal agreement with the first respondent (Mayor Logistics) in 2010 whereby Mayor Logistics would finance the subdivision process and related costs, and in return would purchase one of the subdivided portions for US$50,000. Mayor Logistics partially fulfilled its obligations by financing the subdivision permit. Despite this agreement and before signing a written contract, Mathonsi Family Enterprises resold the same property to the appellant (Guoxing Gong) on 4 April 2011 at a higher price. Mayor Logistics obtained a default judgment for specific performance against Mathonsi Family Enterprises on 5 June 2012 under case number HC 218/12 and placed a caveat (No. 263/12) on the property on 20 June 2012. Despite the existence of the court order and caveat, the appellant obtained transfer of the property under Deed of Transfer 2541/14. The appellant and his legal practitioner were aware of both the court order and caveat when they procured the transfer.

• Whether the appeal against a default judgment could be entertained by the Supreme Court
• Whether a verbal agreement of sale was lawful and binding
• Whether the matter constituted a double sale dispute
• Whether transfer obtained in defiance of a valid court order and caveat conferred valid title
• Whether the appellant acquired defective title through the irregular transfer
• Whether costs on a legal practitioner and client scale were appropriate

The appeal was dismissed with costs at the legal practitioner and client scale. The High Court order cancelling Deed of Transfer No. 2541/14 in the name of Guoxing Gong was upheld.

Transfer of immovable property obtained in deliberate defiance of a valid court order and registered caveat is a nullity and confers no valid title, as anything done contrary to law is void. A verbal agreement for the sale of land is lawful and binding in the absence of statutory prohibition or agreement to the contrary, and the reduction of such agreement to writing is merely a formality unless expressly required. In a double sale dispute, a purchaser who acquires transfer with knowledge of a prior court order and caveat barring such transfer obtains defective title that can be cancelled by the court.

The Court made obiter observations that: (1) the majority of contractual agreements in the jurisdiction are verbal; (2) the appellant's conduct in conniving to obtain registration despite knowledge of the court order and caveat amounted to criminality in a bid to preserve ill-gotten gains; (3) such unbecoming and deplorable conduct cannot go unpunished; (4) the issue of superannuation of the default judgment through effluxion of time was abandoned by counsel and therefore not determined; and (5) complaints regarding non-joinder or irregularities in a default judgment should be laid at the High Court's door through rescission or declaration of nullity, not by appeal to the Supreme Court absent special circumstances.

This case is significant in Zimbabwean property and contract law for several reasons: (1) it confirms that verbal agreements are lawful and binding in the absence of statutory prohibition or contrary agreement; (2) it establishes that transfer of property obtained in defiance of a valid court order and caveat is a nullity and confers defective title; (3) it reinforces the principle that anything done contrary to law is void; (4) it demonstrates that knowledge of existing court orders and caveats when procuring transfer constitutes reprehensible conduct warranting punitive costs; (5) it clarifies the limited appellate jurisdiction over default judgments; and (6) it provides guidance on resolving double sale disputes, prioritizing the party with a valid court order and caveat over a subsequent purchaser who obtained transfer irregularly.