Njanike Construction Company (Pvt) Ltd t/a One Way Building Contractors' Construction v Turnall Holdings Limited

In May 2018, the applicant, a construction company, entered into an agreement with the respondent to purchase building materials (roof sheets, pipes, and related items) for a construction project. The respondent issued a proforma invoice dated 28 May 2018 quoting a price of US$135,167.40. The applicant paid a substantial deposit (approximately 50% of the total price) and the parties agreed that delivery would occur when the applicant's construction project commenced and upon the applicant's notification. Zimbabwe's currency regime changed dramatically in 2019 through Statutory Instrument 33 of 2019, which converted US dollar obligations to RTGS dollars at 1:1, followed by SI 60 of 2024 introducing the Zimbabwe Gold Dollar (ZWG). When the applicant demanded delivery in 2025, the respondent refused, leading to this application for specific performance. The respondent denied a valid contract existed and raised defenses including prescription, the impact of currency changes, and alleged non-performance by the applicant.

• Whether a valid and enforceable contract was concluded between the parties in May 2018
• Whether the contract became perfecta and enforceable despite a suspensive condition regarding delivery timing
• Whether the applicant's claim had prescribed under the Prescription Act [Chapter 8:11]
• Whether Statutory Instrument 33 of 2019 and Statutory Instrument 60 of 2024 extinguished or fundamentally altered the contractual obligations
• Whether the applicant performed its own contractual obligations
• Whether specific performance should be granted in the court's discretion as the appropriate remedy

1. Judgment entered in favor of the applicant. Within 7 days from the date of the order, the respondent must deliver to an address of the applicant's choice or make available for collection the following building materials: (i) 3240 units of 12 feet asbestos; (ii) 2160 units of 9 feet asbestos; (iii) 1620 units of cranked ridges; (iv) 1800 units of fascia boards. 2. The respondent pays costs of suit on the ordinary scale.

The binding legal principles established are: (1) A contract may be concluded by conduct, including acceptance through payment in response to a proforma invoice, when parties demonstrate consensus ad idem on essential terms (merx and pretium); (2) A contract subject to a suspensive condition regarding timing of performance is perfecta (perfected) once all essential terms are agreed, with only the timing of performance held in abeyance; (3) Prescription for a claim subject to suspensive conditions or future performance begins to run only when the condition is fulfilled or notice is given, not from the date of contract formation; (4) Currency conversion legislation (such as SI 33/2019 and SI 60/2024) does not extinguish contractual obligations for delivery of goods, though it may affect monetary obligations; currency changes constitute ordinary commercial risk absent contractual provisions to the contrary; (5) In Zimbabwean law, specific performance is the primary remedy for breach of contract, not an exceptional equitable remedy, and should be granted unless impossibility, undue hardship amounting to injustice, or other exceptional circumstances exist; (6) Where hyperinflation and currency collapse render damages inadequate because the monetary value received would be insufficient to procure substitute goods, specific performance is the appropriate remedy even for generic goods; (7) A party who has accepted and retained payment under a contract cannot later repudiate the contract based on subsequent currency devaluation (the principle against approbating and reprobating).

The court made several non-binding observations: (1) The court noted that if exchange rates had moved in the opposite direction, making the deposit worth more, the respondent would undoubtedly expect the benefit of the bargain, illustrating the principle of reciprocal risk in commercial contracts; (2) The court observed that granting specific performance aligns with preventing unjust enrichment, as denying it would sanction the respondent's retention of payment while avoiding its obligations; (3) The court commented that the respondent's internal terms and conditions purporting to reserve the right to form a contract only upon invoicing at dispatch were not meaningfully communicated to the applicant and were in any event waived by accepting payment; (4) The court noted that nothing in the currency legislation explicitly forbids parties from performing contracts in originally agreed currencies or quantities by mutual agreement; (5) The court observed that this case involves a straightforward one-time delivery of chattels, not personal services or long-term obligations requiring supervision, making specific performance easily enforceable; (6) The court emphasized the broader policy consideration that courts should not rewrite contracts simply because external events have made performance onerous or inconvenient for one party, upholding the sanctity of contract principle.

This judgment is significant in Zimbabwean jurisprudence for several reasons: (1) It clarifies the enforceability of contracts concluded before Zimbabwe's currency regime changes in 2019 and 2024, holding that statutory currency conversions do not extinguish obligations for delivery of goods; (2) It reaffirms the primacy of specific performance as a remedy in Zimbabwean contract law, derived from Roman-Dutch law, distinguishing it from the more restrictive English approach; (3) It addresses how courts should handle contracts with suspensive conditions related to timing of performance, particularly in the context of commercial supply agreements; (4) It provides guidance on when prescription begins to run for claims where performance is subject to notice or future events; (5) It demonstrates judicial commitment to upholding the sanctity of contract even where economic circumstances have changed dramatically, protecting parties from unilateral repudiation based on currency devaluation; (6) It addresses the inadequacy of damages as a remedy in hyperinflationary contexts, recognizing that monetary compensation may be effectively worthless due to currency collapse.