MCA Venture Capital (Private) Limited v Secretary for Mines and Mining Development & Others

The appellant, MCA Venture Capital (Private) Limited, was incorporated in May 2017 and entered into an agreement to purchase eight special mining blocks from Mine Mills Trading (Private) Limited. The sale and transfer were duly registered with the second respondent (Minister of Mines and Mining Development) on 26 July 2017, with certificates of registration issued. The appellant began exploration and mining operations on the claims, particularly claim number 14833BM. In January 2018, the fifth respondent (Zimbabwe Alloys Limited) contacted the appellant claiming ownership of claim 14833BM. On 10 April 2019, the appellant was informed that the fifth respondent was claiming ownership of the disputed claim. On 11 April 2019, the appellant was served with a letter directing both parties to stop operations and attend a hearing on 15 April 2019. The appellant filed an urgent chamber application seeking to interdict the first, second, and third respondents from conducting the hearing and from issuing directives stopping the appellant's mining operations. The fifth respondent was under judicial management pursuant to an order dated 24 July 2013 and confirmed on 8 January 2014. The fifth respondent raised four points in limine, including that the appellant failed to obtain leave to sue as required under the judicial management order. The High Court struck the matter off the roll on this basis.

• Whether leave of court was required to institute proceedings against a company under judicial management
• Whether section 301(1)(c) of the Companies Act applies only to proceedings existing at the time of the judicial management order or to all subsequent proceedings
• Whether section 126 of the Insolvency Act [Chapter 6:07] retrospectively replaced section 301 of the Companies Act [Chapter 24:03]
• Whether the Insolvency Act can take away vested rights acquired under the Companies Act
• Whether the fifth respondent was properly cited and whether it was a nominal party

The appeal was allowed with costs. The judgment of the High Court was set aside and substituted with an order dismissing the preliminary points raised by the fifth respondent with costs. The matter was remitted to the High Court for determination on the merits.

The binding legal principle established is that section 301(1)(c) of the Companies Act [Chapter 24:03], which provides that actions and proceedings against a company under judicial management shall be stayed and not proceeded with without leave of court, applies only to proceedings that were pending at the time the judicial management order was granted, not to proceedings instituted after that order. Further, section 126 of the Insolvency Act [Chapter 6:07] does not operate retrospectively to take away vested rights acquired under the Companies Act. Pursuant to section 17(1)(b) and (c) of the Interpretation Act [Chapter 1:01], where an enactment repeals another, the repeal does not affect rights, privileges, obligations or liabilities acquired, accrued or incurred under the repealed enactment. There is a strong presumption against retrospective construction of statutes, and even where a provision is expressly stated to be retrospective, it is not to be treated as affecting acts and transactions already completed unless such construction appears clearly from the language used or arises by necessary implication.

The Court noted that the question of whether the fifth respondent was a nominal respondent was of no relevance to the determination of whether leave was required, as it did not affect the appellant's already acquired right to proceed without leave. The Court also noted that there had been divergent views in the High Court on the interpretation of section 301 of the Companies Act, with ZFC Limited v KM Financial Solutions (Pvt) Ltd & Anor HH 47/15 holding the provision applicable only to existing proceedings, while G.N. Mlotshwa & Company Legal Practitioners v David Whitehead Textiles Limited & Ors HH 78/17 held it to be all-encompassing. The Supreme Court in Zambezi Gas had settled this divergence in favour of the interpretation in ZFC Limited. The Court also observed that judicial management under the Companies Act is different from corporate rescue under the Insolvency Act, and that the fifth respondent did not have a business rescue practitioner as it was not governed by corporate rescue provisions.

This judgment is significant in Zimbabwean law (which shares common legal principles with South African law) for clarifying the scope of leave requirements when instituting proceedings against companies under judicial management. It confirms that the requirement for leave under section 301(1)(c) of the Companies Act applies only to proceedings that existed at the time the judicial management order was granted, not to proceedings instituted thereafter. The judgment also reinforces the principle of non-retrospectivity in statutory interpretation, particularly regarding provisions that would take away vested rights. It confirms that new legislation (such as the Insolvency Act) does not retrospectively remove rights already acquired under previous legislation unless there is clear language or necessary implication to that effect. The case is important for mining disputes and civil procedure involving companies in financial distress.