Rydale Ridge Park Private Limited v Ruth Muridzo NO (in her capacity as the executrix dative of the estate of the late Tererai Terance Muridzo)

The parties entered into an instalment sale agreement on 7 September 2018 for a residential stand at Rydale Ridge Park (Stand Number 3047) for US$18,500.00. The terms required a US$5,000.00 deposit and US$563.00 monthly instalments over 24 months beginning 1 October 2018. The agreement specified payment in cash to the applicant. The purchaser (respondent) did not always adhere strictly to payment terms, sometimes skipping months and making payments via bank transfers instead of cash, which the applicant initially accepted and receipted. In August 2019, February and March 2020, the respondent transferred RTGS$8,996.00 into the applicant's bank account, which the applicant refused to acknowledge. The respondent contended that by March 2020 he had fully paid the balance. On 30 July 2020 and 12 August 2020, the respondent tendered cash payment of ZWL$8,996.00, which the applicant refused, demanding payment in US dollars. The respondent issued summons under HC 5043/20 on 11 September 2020 for transfer of the land. Summons were served on the applicant's receptionist, Ms Sheila Mkhize, on 17 September 2020. The applicant failed to enter appearance to defend, and default judgment was granted on 11 November 2020. The applicant became aware of the default judgment on 17 March 2021 and filed this application for rescission.

• Whether the applicant showed good and sufficient cause for rescission of the default judgment
• Whether the applicant provided a reasonable explanation for the default in entering appearance to defend
• Whether the applicant's application and defence were bona fide
• Whether the applicant had prospects of success on the merits
• Whether the respondent breached the contract by paying in RTGS/ZWL currency instead of US dollars
• The application of section 22(1)(d) and section 22(4)(a) of the Finance (No 2) Act, 2019 to the contractual obligation
• Whether proper notice of breach was given in accordance with section 8 of the Contractual Penalties Act [Chapter 8:04]

The application for rescission of judgment granted under case number HC 5043/20 on 11 November 2020 was dismissed with costs against the applicant.

For rescission of judgment, an applicant must show good and sufficient cause by demonstrating: (a) a reasonable explanation for the default, (b) bona fides of the application, and (c) bona fides of the defence on the merits with prospects of success. These requirements are considered cumulatively. Contractual obligations expressed in US dollars in domestic transactions concluded before the effective date of the Finance (No 2) Act, 2019 are deemed to be valued in RTGS dollars at a one-to-one rate pursuant to section 22(1)(d) and section 22(4)(a) of that Act. A party cannot refuse payment tendered in compliance with this statutory provision. In instalment sale agreements, termination for breach requires compliance with section 8 of the Contractual Penalties Act [Chapter 8:04], which governs proper notice of breach.

The court noted that what is stated in an affidavit and is not controverted and cannot be dismissed on account of improbability should be accepted. However, the absence of supporting affidavits from key witnesses (such as the Managing Director or Ms Mkhize) weakens an applicant's case. The court observed that the applicant's conduct suggested the real issue was currency valuation rather than contractual breach, as evidenced by the applicant's email demanding either US$8,996.00 or local currency equivalent, yet later refusing the local currency tender. The court characterized the breach argument as an afterthought, noting the applicant had previously accepted bank transfers without objection and only raised the breach issue long after the disputed payments were made.

This case is significant in Zimbabwean law for its application of the Finance (No 2) Act, 2019, particularly sections 22(1)(d) and 22(4)(a), which provided for the conversion of USD-denominated domestic contractual obligations to RTGS dollars at a one-to-one rate. The judgment reinforces that parties cannot refuse payment tendered in compliance with statutory currency provisions and demonstrates the courts' approach to rescission applications where the underlying defence lacks merit. It also emphasizes the requirement for proper notice of breach in instalment sale agreements under the Contractual Penalties Act and illustrates that courts will scrutinize whether claims of breach are genuine or mere afterthoughts to avoid statutory obligations.