Rodger Muhlwa v Alpha Media Holdings (Pvt) Ltd t/a Southern Eye and Others

The applicant (Muhlwa) successfully sued the respondents for defamation in HC 2163/16 and was awarded damages of US$16,000 on 9 May 2019. The respondents appealed unsuccessfully to the Supreme Court (SC 110-20). On 19 August 2020, respondents paid ZWL$16,000 (not US$) claiming this constituted full settlement under S.I. 33/2019. The applicant rejected this and issued a writ of execution on 22 September 2020 for US$16,000. The writ contained an error regarding the date from which interest was calculated. Respondents filed an urgent application (HC 1950/20) to interdict execution. The applicant's legal practitioner filed a notice of consent to set aside the defective writ. On 12 November 2020, a provisional order was granted ex parte and confirmed as a final order on 18 March 2021. The final order included a declaratory provision that the respondents had fully discharged their obligations under the defamation judgment. The applicant's legal practitioner only realized after the final order that it went beyond merely setting aside the defective writ and included a substantive declaration that the debt was fully paid. The applicant applied for partial rescission of the default judgment under Order 9 Rule 63(1) of the High Court Rules 1971, claiming mistake and misapprehension by his legal practitioner.

• Whether the court had jurisdiction to hear the application given the citation of Rule 63 instead of Rule 56
• Whether the applicant established good and sufficient cause for rescission of the default judgment
• Whether the explanation for the default (mistake by legal practitioner) was reasonable
• Whether the application and defence were bona fide
• Whether the defence had prospects of success on the merits
• Whether S.I. 33/2019 (Part VI of the Finance (No. 2) Act No. 7 of 2019) applied to convert a defamation damages judgment awarded in US$ after the first effective date (22 February 2019) to RTGS dollars at 1:1
• Whether a delictual claim for unliquidated damages constitutes an 'asset' or 'liability' valued and expressed in US$ before the effective date for purposes of S.I. 33/2019

1. The default judgment granted under HC 1950/20 on 18 March 2021 was partially rescinded by setting aside paragraphs 1 and 3 thereof (the declaratory order that respondents had fully discharged their obligations and the costs order). 2. Costs of suit to be costs in the cause under HC 1950/20.

For purposes of currency conversion under S.I. 33/2019, a delictual claim for unliquidated damages does not constitute an 'asset' or 'liability' valued and expressed in a particular currency until a competent court has determined liability and assessed quantum by judgment. Where a defamation judgment awarding damages in US$ was granted after the first effective date (22 February 2019), even though the cause of action arose before that date, S.I. 33/2019 does not apply to convert the judgment debt to RTGS dollars at 1:1 because the liability was not 'valued and expressed' in US$ immediately before the effective date. A cause of action is neither an asset nor a liability. For rescission of default judgment, good and sufficient cause requires: (1) reasonable explanation for the default, (2) bona fides of the application, (3) bona fide defence on the merits, and (4) prospects of success. Citation of an incorrect rule does not deprive a court of jurisdiction where the substance of the application is clear.

The court observed that it 'boggles one's mind' why an applicant who had successfully prosecuted a claim for US$ damages through trial and appeal, rejected RTGS payment, and issued execution for US$, would suddenly consent to a declaration that RTGS payment was sufficient. The court commented that 'the totality of the circumstances that gave rise to this application shows that the order under HC 1950/21 should have never been granted.' The court noted approvingly the Supreme Court's statement in Ngalulu that 'a delict, unlike a financial or contractual obligation cannot be categorized as an asset or liability until it is voluntarily accepted as such by the wrongdoer or until such acceptance is foisted upon the wrongdoer by a court of competent jurisdiction' because 'a delict is committed and does not accrue like an asset nor is it incurred like a liability.'

This case is significant in Zimbabwean law (applicable to South African jurisprudence by analogy on procedural and currency matters) for several reasons: (1) It clarifies the requirements for rescission of default judgments under Rule 63, particularly where legal practitioners make mistakes. (2) It provides important guidance on when S.I. 33/2019 (currency conversion legislation) applies, specifically that it does not apply to delictual claims for unliquidated damages that were only quantified by court judgment after the effective date. (3) It distinguishes between contractual obligations (where quantum is known) and delictual claims (where quantum must be assessed), holding that only the former constitute 'assets' or 'liabilities' for currency conversion purposes before judgment. (4) It reinforces that a cause of action is neither an asset nor a liability. (5) It demonstrates the court's approach to distinguishing precedents based on material facts, particularly regarding when liability arises and is quantified.