Paul Karanda v Gladys Svosve

The parties entered into a sale agreement whereby the defendant sold Stand 1234 Northwood, Chivhu to the plaintiff (a Methodist pastor) for USD 30,000. Payment was to be made partly in cash and partly by delivery of 10 cattle by 18 March 2013, with cash instalments of $10,600 by 30 April 2013 and $15,000 by 30 April 2014. The plaintiff defaulted on the initial payment deadlines. Instead of cancelling, the defendant sought mediation through their Bishop in May 2013. Following mediation, the plaintiff made payments totalling $5,840 between May and September 2013, and delivered 14 cattle (evidenced by a stock clearance certificate dated 15 May 2013). In November 2013, the defendant cancelled the agreement by letter and resold the property to a third party for allegedly $22,500. The defendant tendered return of $5,840 and 10 cattle but disputed receiving 14 cattle. The plaintiff sought refund of all payments made.

• Whether the defendant waived her right to cancel the agreement and claim damages by accepting late payments contrary to the original agreement terms
• Whether the agreement was lawfully terminated
• Whether the defendant was unjustly enriched by receiving payment from both the plaintiff and a third party purchaser
• Whether the plaintiff was entitled to a refund of the purchase price paid
• Whether the Contractual Penalties Act [Chapter 8:04] applied to the transaction

1. The defendant to pay the plaintiff $5,840.00. 2. The defendant to return 14 bovines within 14 days, failing which to pay $7,100.00. 3. Interest at the prescribed rate on both amounts from 20 November 2013 until payment in full. 4. The defendant to pay costs of suit.

1. Waiver of contractual rights can be established by conduct that is plainly inconsistent with an intention to enforce those rights, where the party acts with full knowledge of the rights being waived. 2. Actively seeking and accepting performance on terms contrary to the original agreement after breach constitutes waiver of the right to cancel based on that breach. 3. A letter confirming that cancellation has occurred does not satisfy a contractual requirement for advance written notice of intention to cancel with opportunity to remedy the breach. 4. A seller who receives payment from a purchaser and then cancels the sale and resells to a third party is unjustly enriched unless entitled by contract or damages claim to retain the original payment. 5. Absent a forfeiture clause or proven damages claim, a seller cannot retain purchase price payments upon termination of a sale agreement.

The court noted that the validity of the agreement may have been questionable due to potential fraudulent misrepresentation or material non-disclosure, as the defendant sold only her rights as cessionary without obtaining Local Authority consent and without disclosing to the plaintiff that he was only acquiring cessionary rights rather than full title. However, since this point was not argued, the court did not decide the matter on this basis. The court also observed it was unnecessary to determine whether the Contractual Penalties Act [Chapter 8:04] applied, having resolved the matter on contractual principles. The court commented that a party cannot abandon their pleadings during trial without seeking amendment, disagreeing with the interpretation of Goldenmillion Engineering (Pvt) Ltd v Mettalon Gold Zimbabwe (Pvt) Ltd suggested by defence counsel.

This case establishes important principles in Zimbabwean contract law regarding waiver of contractual rights through conduct. It confirms that a party can waive strict contractual rights including cancellation and damages by conduct plainly inconsistent with enforcing those rights, even without express written variation. The case illustrates the application of unjust enrichment principles where a seller receives payment from two parties for the same property. It also clarifies that mere confirmation of cancellation does not constitute proper notice of termination where the contract requires advance notice of breach and opportunity to remedy. The judgment reinforces that a party seeking to retain payments upon termination must either have contractual provision for forfeiture or must counterclaim for proven damages.