Jack Bean (Private) Limited v John Bukutu and Contact Real Estate & Investments (Private) Limited and The Registrar of Deeds N.O.

On 19 February 2021, the applicant (Jack Bean (Private) Limited) and the first respondent (John Bukutu) entered into a lease agreement for a property located at No. 34 Arcturus Road, Highlands, Harare, held under Deed of Transfer No. 3496/09, measuring 4334 square metres. On 16 August 2021, the first respondent indicated his intention to sell the leased property and granted the applicant a right of first refusal. On 21 October 2021, the applicant presented an offer to purchase the property for USD$280,000.00. The second respondent (Contact Real Estate & Investments) communicated that the offer was accepted subject to proof of funds by 22 October 2021. The applicant provided proof of funds on 22 October 2021. However, by email dated 22 October 2021, the second respondent indicated that the first respondent intended to consider other buyers instead of the applicant. This prompted the applicant to file an urgent chamber application to interdict the sale to third parties.

• Whether the applicant has locus standi to bring the application
• Whether third parties should have been cited
• Whether the matter was urgent
• Whether the applicant holds a valid right of first refusal
• Whether the first and second respondents lawfully cancelled the applicant's right of first refusal
• Whether the applicant is entitled to an interdict preventing sale to third parties

The court granted the following final order: (1) The first and second respondents' cancellation of the applicant's right of first refusal was declared unlawful, null and void; (2) Any agreements of sale the respondents may have executed with third parties in respect of the property were declared null and void; (3) The applicant was declared a holder of a valid right of first refusal to purchase the property; (4) It was confirmed that the applicant had properly exercised the right of first refusal and was entitled to execution of an agreement of sale with the first respondent in terms of the accepted offer; (5) The first and second respondents were ordered to pay costs of suit. Interim relief was granted interdicting the first and second respondents from selling the property to any other person and the third respondent (Registrar of Deeds) from registering any transfers of the property to any other person pending the return date.

The binding legal principle established is that where a party holds a valid right of first refusal to purchase property, exercises that right by making an offer which is accepted by the seller, and satisfies all conditions precedent (such as providing proof of funds), that party's right to the property becomes clear and unassailable. Any subsequent purported cancellation of that right without just or legal cause is unlawful and null and void. The holder of such a right is entitled to execution of an agreement of sale in terms of the accepted offer, and the court will grant interdict relief to prevent the seller from disposing of the property to third parties, as such disposal would cause irreparable harm to the right holder. Any agreements of sale executed with third parties in contravention of a validly exercised right of first refusal are null and void.

The court did not make extensive obiter observations beyond the core findings. However, the court's dismissal of the points in limine without detailed discussion suggests that the court considered the technical objections raised (locus standi, non-joinder, and urgency) to be clearly without merit in the circumstances where the applicant's substantive rights were so evidently threatened. The court's emphasis on the need to protect the applicant from "irreparable harm" indicates a judicial recognition that rights of first refusal create enforceable proprietary interests that deserve strong protection through interdict relief.

This case is significant in Zimbabwean property and contract law as it reinforces the legal protection afforded to holders of rights of first refusal. The judgment confirms that once a right of first refusal is validly granted and properly exercised through an accepted offer, the holder's rights are "clear and unassailable" and cannot be unilaterally cancelled without just or legal cause. The case demonstrates the court's willingness to grant interdict relief to protect contractual rights in property transactions and prevent irreparable harm to parties who have validly exercised their contractual rights. It also clarifies that attempting to sell property to third parties after accepting an offer from a right of first refusal holder is unlawful and agreements with such third parties will be declared null and void.