The plaintiff, a law firm, rendered legal services to the defendant between 2 August 2018 and 28 November 2018. The plaintiff issued an invoice for US$14,922.00 in December 2018. The defendant queried the amount, which led to taxation of the bill of costs. On 8 May 2019, the Taxing Master taxed the bill at $14,714.25. On 22 July 2019, the defendant paid RTGS14,922 and maintained he had fully discharged his obligation. The plaintiff then issued summons on 9 August 2019 claiming US$13,166.00 as the balance of taxed costs. This matter arose during Zimbabwe's currency transition period, particularly involving the application of Statutory Instrument 33 of 2019 (effective 22 February 2019) which introduced the RTGS Dollar at 1:1 parity with USD for pre-existing obligations, and SI 142 of 2019 (effective 24 June 2019) which established the Zimbabwe Dollar as sole legal tender for domestic transactions.
1. The plaintiff's claim for US$13,166 was dismissed as being contrary to the provisions of Statutory Instrument 33 of 2019 and Statutory Instrument 142 of 2019. 2. It was declared that the defendant's payment of RTGS14,922 on 22 July 2019 constituted a full and final settlement of his liability under the bill of costs taxed on 8 May 2019. 3. The plaintiff was ordered to pay the defendant's costs of suit on the ordinary scale.
The binding legal principles established are: (1) Under SI 33/2019, liabilities 'valued and expressed in United States Dollars immediately before the effective date' of 22 February 2019 are deemed to be valued in RTGS at 1:1 parity, regardless of when the exact quantum was determined or liquidated; (2) The phrase 'immediately before the effective date' refers to the state in which the liability existed before that date, not to a specific timeframe or requirement that valuation occur on that specific date; (3) A liability is 'valued and expressed' in USD for purposes of SI 33/2019 if it was denominated in USD at any time before 22 February 2019 and that status remained unchanged until the effective date, regardless of whether the exact amount was disputed or unliquidated; (4) Following SI 142/2019, claims for payment purely in USD for domestic debts between domestic parties, without a prayer for conversion or allegation of a foreign obligation, are unlawful as they contravene the establishment of the Zimbabwe Dollar as sole legal tender; (5) Payment in RTGS/Zimbabwe Dollar at the statutory 1:1 rate for debts falling under SI 33/2019 constitutes full and final discharge of the obligation.
The court made several important observations: (1) The transition of Zimbabwe's currency in 2019 was 'a huge event that redefined the value of all historical debts'; (2) The legislature, through SI 33/2019 and later the Finance Act, made a deliberate choice to allow debtors to settle USD-denominated debts in local currency at par; (3) The court has no power to alter legislative choices, regardless of the economic hardship such choices may cause to particular parties; (4) The plaintiff's failure to secure payment before the law changed resulted in the loss of USD value, as by the time payment was made, the law had decreed that $1 USD from 2018 equaled $1 RTGS in 2019; (5) A subsequent lawsuit seeking to recover USD value through the interbank rate is essentially a claim for value that the law has specifically taken away; (6) The plaintiff's reliance on Kawara v Sheriff and Anor HB 2-22 was insufficient to overturn the weight of the binding Supreme Court authority in Zambezi Gas.
This case is significant in Zimbabwean jurisprudence as it applies and reinforces the Supreme Court's interpretation in Zambezi Gas regarding the treatment of pre-existing USD-denominated debts during Zimbabwe's 2019 currency transition. The judgment clarifies that the critical question under SI 33/2019 is not when a debt was liquidated or reduced to a certain amount, but rather whether the underlying liability was valued and expressed in USD before 22 February 2019. The case establishes that professional fees invoiced in USD in 2018, even if subsequently taxed in 2019, fall within the scope of SI 33/2019 and must be discharged at 1:1 parity in local currency. It also confirms that claims for USD payment in domestic transactions after the promulgation of SI 142/2019 are unlawful where the Zimbabwe Dollar is the sole legal tender. The judgment demonstrates the binding nature of legislative currency conversion measures and the courts' inability to provide equitable relief where statutory provisions clearly mandate a particular outcome, even if economically harsh to one party.