Martha Mukundwi v Mishech Stephen Terera and Juniah Terera and The Registrar of Deeds N.O.

The plaintiff purchased immovable property, described as Lot 15 of Kopje Allen of Twentydales Estate (measuring 1.6568 hectares), from the first and second defendants pursuant to an agreement of sale dated 7 July 2020. The plaintiff paid the full purchase price of USD 57,988.00 according to the payment terms. Transfer of title could only be effected after the defendants fulfilled conditions in the subdivision permit (Subdivision Permit No. Mash East 1/2017) granted by the local authority, relating to servicing the land. The defendants failed to fulfill the permit conditions, leading to the suit. The parties subsequently agreed on all issues except liability for payment of endowment fees to the local authority. They referred this specific question to court as a special case by filing a Deed of Settlement incorporating a Statement of Agreed Facts on 5 August 2025.

• Who bears liability for payment of endowment fees under Section 41(1) of the Regional, Town and Country Planning Act [Chapter 29:12] and Condition 8 of Subdivision Permit Mash East 1/2017 - the seller (defendants) or the purchaser (plaintiff)?
• What is the proper interpretation of 'owner' and 'proceeds from the sale' in the context of subdivision permits and endowment fees?
• Whether the plaintiff is entitled to an order compelling the defendants to complete development and transfer the property

1. The first and second defendants must carry out all works required to satisfy Conditions 4 and 5 of Subdivision Permit Number Mash East 1/2027 through their developer and secure the Certificate of Compliance within 6 months. 2. The defendants must pay the endowment amount assessed by the Local Authority for Lot 15 within 7 days of issue of the certificate of compliance, in terms of Condition 8. 3. The defendants must sign all papers necessary for transfer of the property to the plaintiff within 7 days of issue of the Certificate of Compliance. 4. In the event of failure to comply, the plaintiff may approach court for an order authorizing the Sheriff to sign necessary documents and effect transfer at the defendants' cost. 5. The first and second defendants must pay the plaintiff's costs on a legal practitioner and client scale.

Endowment fees payable under Section 41(1)(b)(ii) of the Regional, Town and Country Planning Act [Chapter 29:12] and conditions of a subdivision permit are the liability of the seller who receives the proceeds from the sale of subdivided land, not the purchaser. The term 'proceeds from the sale' in a subdivision permit must be given its ordinary grammatical meaning as the money realized or received from the sale transaction. The 'owner' for purposes of endowment fees is the party who has ownership at the time of sale and who realizes the proceeds. Endowment fees must be set aside from what the landowner has received, as the landowner and local authority share what has been received from the sale.

The court noted that the agreement of sale was silent on the question of who is liable for payment of endowment fees, necessitating recourse to the Act and the subdivision permit. The court observed that interpretation of the phrase 'proceeds from the sale' requires no sophistry and should not be complicated, stating that 'rocket science is not required' to understand its plain meaning. The court emphasized that endowment fees are levied from the proceeds of the sale received by the seller, and that a seller cannot be expected to violate permit conditions by requiring the buyer to pay such fees when it is the seller who has received the proceeds.

This case provides important clarification on the allocation of liability for endowment fees in subdivision transactions under Zimbabwean law. It establishes that endowment fees are the responsibility of the seller who receives proceeds from the sale, not the purchaser. The judgment provides guidance on the interpretation of subdivision permit conditions and the Regional, Town and Country Planning Act, particularly regarding the meaning of 'owner' and 'proceeds from the sale' in the context of land development and transfer. The case also demonstrates the use of special case procedure to resolve discrete legal issues by agreement between parties.