Hersel Investments Private Limited v The Registrar of Deeds N.O. and Others

The applicant purchased property (an undivided 5% share No. 19 in the Remainder of Stand 1652 Salisbury Township held under Deed of Transfer number 11009/2005) from the fourth respondent by private treaty on 11 November 2013 and paid the full purchase price. The applicant took vacant possession and leased the property to a tenant. Transfer of the property was delayed due to ZIMRA queries concerning capital gains tax. Meanwhile, the third respondent sued the fourth respondent for debt, obtained judgment, and a writ of execution on 10 July 2014. The property, still registered in the fourth respondent's name, was attached and sold at public auction to the fifth respondent. The applicant only became aware of these proceedings on 16 January 2015 through written communication from the chairperson of the block of apartments. The applicant was never cited as a party in the court processes. The applicant filed an urgent chamber application on 19 January 2015 seeking to interdict the transfer of the property to the fifth respondent.

• Whether the matter was urgent and properly before the court on an urgent basis
• Whether the applicant had a prima facie right to the property despite title remaining in the fourth respondent's name
• Whether the applicant would suffer irreparable harm if the interim relief was not granted
• Whether the balance of convenience favoured the granting of interim relief
• Whether the applicant had an adequate alternative remedy
• Whether property sold to and paid for by the applicant but not yet transferred could be attached in execution of a judgment against the seller

The court granted interim relief interdicting: (1) the First Respondent (Registrar of Deeds) from transferring the property to the Fifth Respondent; and (2) the Second Respondent (Sheriff) from signing documents of transfer in pursuance of the writ of execution, pending the outcome of the application to set aside the sale by auction. The applicant's legal practitioners were given leave to serve the provisional order on the respondents. The points in limine were dismissed.

Where a purchaser has paid the full purchase price for property and taken vacant possession pursuant to a valid sale agreement, that purchaser acquires real rights in the property that are enforceable against third parties, including judgment creditors of the seller, even though legal title has not yet been transferred. Such property cannot be lawfully attached and sold in execution of a judgment debt against the seller. A matter is urgent where an applicant acts promptly upon becoming aware of threatened harm to their rights, and the urgency is not self-created by deliberate or careless delay. For purposes of a temporary interdict, a purchaser in possession who has paid the full purchase price has a clear prima facie right to the property that justifies interim protection pending final determination of the dispute.

The court noted that had the applicant known of the attachment, it could have issued interpleader summons or contested the sale and/or subsequent confirmation. The court also observed that had the correct status of the property been disclosed to the Sheriff, the property could have been excluded from the property that was attached. The court remarked that the fourth respondent was now bankrupt and had ceased to operate, with its other two pieces of property under judicial attachment, making a claim for damages against the fourth respondent an inadequate remedy. The court also noted that the fifth respondent, while confirmed as the highest bidder at public auction, had not paid any amount towards the purchase price, which further tilted the balance of convenience in favour of the applicant.

This case is significant in Zimbabwean property law as it establishes that a purchaser who has paid the full purchase price and taken possession of property has enforceable real rights that prevent attachment and sale in execution of a judgment against the seller, even where legal title has not yet been transferred. It affirms that the equitable rights of a purchaser in possession prevail over the claims of judgment creditors of the seller. The case also provides guidance on when urgency exists in applications to prevent transfer of property, particularly where an applicant was not cited in the original proceedings and only learned of the sale shortly before transfer was to occur. It demonstrates the court's willingness to protect substantive property rights over technical legal title in circumstances where a bona fide purchaser would otherwise be prejudiced through no fault of their own.