Tatenda Cris Irvine Mtungwazi v Ranch Metro (Pvt) Ltd and Others

The applicant entered into a business venture with others to develop residential stands and sell them to prospective buyers in Bulawayo. The shareholding was agreed at 20% for each party, with 40% to be used to service the stands. A company was formed with the applicant as one of the directors. The company acquired 97 stands, with each shareholder entitled to 20 stands and the balance for servicing the area. The applicant contributed $1,600 towards the purchase. After selling 10 stands, the applicant's name was removed from the directorship without his consent. A bank account was opened with Commercial Bank of Zimbabwe to which he was not a signatory. All company transactions were diverted from Agri-bank to CBZ without his knowledge or consent. The respondents obtained a loan from CBZ bank without his knowledge and were planning to dispose of 10 stands to which he claimed entitlement.

• Whether the applicant's removal from directorship was lawful
• Whether the applicant had a right to be informed and consulted about company financial transactions and disposal of company assets
• Whether the applicant would suffer irreparable harm if not granted an interdict
• Whether the matter qualified for urgent treatment
• Whether the balance of convenience favored granting a provisional order

The provisional order was granted in favor of the applicant, interdicting the respondents from disposing of the stands and conducting company transactions without the applicant's knowledge and consent pending final determination of the matter.

A provisional order will be granted where a party demonstrates that they have an interest in company assets and transactions, and would suffer greater prejudice than the other party if the interdict is not granted. Where a shareholder/director has been removed from company management and banking arrangements have been changed without their knowledge or consent, and there is a risk of disposal of assets to which they claim entitlement, the balance of convenience favors granting an interdict to preserve the status quo pending final determination. The party restrained by the provisional order has recourse to apply for urgent hearing if they consider they are suffering prejudice.

The court observed that the Rules provide a mechanism for dealing with matters urgently if the restrained party considers that it may suffer harm as a result of the interdict. This suggests that the granting of a provisional order does not prejudice the respondents unduly as they have procedural remedies available to expedite the final hearing if needed.

This case demonstrates the Zimbabwean High Court's approach to granting provisional interdicts in urgent company law disputes where a shareholder/director alleges unlawful removal and unauthorized disposal of company assets. It illustrates the application of the balance of convenience test in urgent applications and the court's willingness to protect minority shareholders' rights pending final determination of disputes. The judgment emphasizes the importance of transparency and consent in company dealings, particularly regarding directorship changes, banking arrangements, and asset disposals.