Nelisiwe Mlambo Karara v Arosume Property Development and Others

The applicant was allocated stand number 294 Carrick Creagh, Borrowdale by the 4th respondent (Minister of Local Government and Public Works) in October 2011 in terms of a lease agreement. The 2nd respondent (a housing cooperative) had entered into a partnership with the 4th respondent for land allocation, with the 1st respondent appointed to develop the stands. The applicant, a member of the 2nd respondent's executive, claimed exemption from paying development fees. On 6 August 2019, she discovered a letter dated 18 December 2018 demanding payment of $404,999.04 in outstanding development fees by 31 January 2019. The letter was not served at her domicilium citandi et executandi (987 Sugarloaf Road, Glen Lorne) but at a postal address. She also discovered the property had been allocated to the 3rd respondent. The applicant sought to have her lease agreement declared valid and the subsequent allocation to the 3rd respondent set aside, arguing there was no valid service or cancellation of her lease agreement.

• Whether there was valid service of the notice of cancellation at an address other than the domicilium citandi et executandi chosen in the lease agreement
• Whether there was valid cancellation of the lease agreement in accordance with its terms (clauses 15 and 22)
• Whether the applicant was entitled to specific performance despite non-compliance with material terms of the lease agreement
• Whether the Contractual Penalties Act (Chapter 8:04) applied to the lease agreement
• Whether the court should exercise its discretion to grant a declaratory order in the circumstances

The application was dismissed with costs.

1. Service of legal notices must be effected at the domicilium citandi et executandi specified in a contract unless the party has notified of a change of address. Service at any other address requires proof of actual receipt. 2. Where a contract specifies the procedure for cancellation, that procedure must be strictly followed. A forfeiture clause does not override specific cancellation provisions agreed upon by the parties. 3. Cancellation must be effectively communicated to the other party either through notice, service of summons, or other clear declaration as provided in the contract. 4. Specific performance is a discretionary remedy that will not be granted to a party who has not performed its own obligations under the contract and has not tendered performance. 5. A phased lease agreement with an option to purchase does not constitute an instalment sale of land under the Contractual Penalties Act until the conditions precedent for the sale are fulfilled.

The court noted that even though the 4th respondent's conduct in attempting to cancel may have been procedurally defective, the applicant's own conduct demonstrated significant breaches of the lease agreement including failure to exercise the option to purchase within the stipulated time, failure to commence building works as required, and irregular rental payments. The court observed that it would be inequitable to grant relief to a party seeking to hold others accountable while not being true to the agreement herself. The court also commented that the paucity of evidence regarding the Tripartite Agreement and the agreement between the 1st and 3rd respondents disabled the court from making a fully informed decision on those aspects, highlighting the importance of placing all relevant agreements before the court when their terms are material to the dispute.

This case is significant in Zimbabwean contract law for its clarification of several important principles: (1) the strict enforcement of domicilium citandi et executandi provisions in contracts and the requirement for valid service at the chosen address; (2) the requirement that cancellation procedures specified in contracts must be strictly followed, including proper notification and declaration of termination; (3) the court's discretion to refuse specific performance where the party seeking it has not performed its own contractual obligations or tendered performance; (4) the principle that a party cannot seek equitable relief while itself being in breach of the agreement; and (5) clarification on when the Contractual Penalties Act applies (only to instalment sales of land, not to lease agreements with options to purchase where conditions precedent have not been fulfilled). The case reinforces that courts will not assist parties who come to court with unclean hands or who have not complied with their own contractual obligations.