Muchaneta Theodora Chimbandi v The Taxing Officer and Mabel Canvas (Private) Limited

The second respondent successfully sued the applicant for US$58,500 under HC 11725/16. After the High Court granted judgment, the applicant appealed to the Supreme Court (SC 18/20), which modified the order on 21 July 2020 to require payment of the RTGS equivalent of US$58,500 calculated at the prevailing interbank rate. The second respondent then prepared a bill of costs for taxation, with items 1-133 denominated in United States dollars using the 2011 General Law Society Tariff, payable at the interbank rate on the date of taxation. The applicant objected, arguing this contravened S.I. 33/19 and S.I. 142/19 which introduced the RTGS dollar and later made the Zimbabwe dollar the sole legal tender. The applicant requested the Taxing Officer refer the legal issue to a judge in chambers under Rule 313, but the Taxing Officer declined and proceeded with taxation on 13 August 2020. The applicant then sought review under Rule 314.

• Whether the Taxing Officer exercised her discretion judiciously when she decided not to refer the legal issue to a judge in chambers under Rule 313
• Whether the Taxing Officer erred in proceeding to tax a bill of costs denominated in United States dollars in light of S.I. 33/19, S.I. 142/19, and the Finance Act (No.2) of 2019
• Whether costs incurred before the first effective date (22 February 2019) but taxed after that date could be denominated in United States dollars or must be converted to RTGS/Zimbabwe dollars
• The appropriate order as to costs

1. The application for review was granted. 2. Items 1 to 133 of the bill of costs taxed by the first respondent on 13 August 2020 under HC 11725/16 were set aside. 3. The matter was remitted back to the first respondent for taxation of items 1 to 133 only after the second respondent denominated its attendances in Zimbabwean dollars. 4. Each party to bear its own costs of suit.

After S.I. 142/19 declared the Zimbabwe dollar as the sole legal tender for all domestic transactions in Zimbabwe (effective 24 June 2019), it became unlawful to denominate bills of costs in United States dollars, even where the legal services were rendered before the first effective date (22 February 2019) and even if parties consented to such denomination. Bills of costs presented for taxation after the currency regime change must be denominated in Zimbabwe dollars in accordance with the prevailing legal tender laws at the time of taxation. Anything done in direct conflict with a statute is a nullity. Inferior courts are bound by decisions of superior courts and must follow binding precedents such as Zizhou v Taxing Officer & Another.

The court observed that Rule 313, which allows a taxing officer to refer points to a judge in chambers, uses the word "may" and is therefore permissive rather than mandatory, vesting discretion in the taxing officer. The court noted it would be slow to interfere with such discretion unless the taxing officer acted on a wrong principle or failed to exercise discretion at all. The court also commented that the 2011 General Law Society Tariff, being a professional tariff rather than an enactment passed by Parliament, did not fall within section 22(1)(f) of the Finance Act (though this point was not definitively decided as it was unnecessary given the court's findings). The court noted that in complex areas of law, it may be appropriate to order each party to bear its own costs rather than applying the usual rule that costs follow the event.

This case is significant in Zimbabwean jurisprudence as it clarifies the application of currency regime changes introduced by S.I. 33/19 and S.I. 142/19 to the taxation of legal costs. It applies and reinforces the Supreme Court precedent in Zizhou v Taxing Officer, establishing that bills of costs must be denominated in the currency that is legal tender at the time of taxation, regardless of when the underlying work was performed or what currency was referenced in applicable tariffs. The judgment emphasizes that the transition to Zimbabwe dollar as sole legal tender affected all domestic transactions including the taxation of legal costs, and that this position cannot be altered by party consent. It also provides guidance on the exercise of discretion by taxing officers and the binding nature of superior court decisions on inferior courts.