Tinashe Mangena and Ndenda Asidi v Marvellous Shumba and Arkrite Holdings (Pvt) Ltd and Others

The applicants, a customarily married couple, entered into an instalment sale agreement with the first respondent in 2019 for the purchase of Plot Number 5 Halfway Farm, Kadoma, measuring 2.32 hectares. The agreed purchase price was paid in full and vacant possession was given to the applicants in 2022. The applicants constructed dwelling structures on the property. All necessary steps toward transfer were completed by mutual agreement, including obtaining a Capital Gains Tax certificate, conducting a ZIMRA interview, completing preliminary cession with the local council (Sanyati Rural Council), and obtaining rate clearance certificates in the applicants' names. At the final stage requiring the seller's signature on conveyancing declarations, the first respondent refused to proceed. By letter dated 15 November 2024, the first respondent purported to cancel the contract citing failure to effect transfer and relying on clause 9 of the agreement, offering to refund the purchase price. The applicants rejected this repudiation and cancellation, insisting on specific performance of the contract.

• Whether the relief of specific performance was available to the applicants given the provisions of clause 9 of the parties' agreement of sale
• The proper interpretation of clause 9 in relation to clause 10 of the agreement of sale
• Whether the respondents' repudiation of the contract was lawful
• Whether damages or refund would constitute adequate compensation for the applicants
• Whether the court should exercise its discretion to grant specific performance in the circumstances

The court ordered: (1) The application to compel transfer was granted; (2) The first respondent must sign all transfer papers, make all appearances, and pay tax obligations necessary to effect transfer of Plot Number 5 of Halfway Farm, Kadoma (2.32 hectares, Title Deed Number 1620/2011) to the applicants within 7 days; (3) If the first respondent fails to effect transfer within 7 days, the Sheriff of the High Court or his deputy is authorized to sign all necessary documents on behalf of the seller and do all things necessary to effect transfer into the applicants' names; (4) Costs follow suit (ordinary costs awarded to the applicants).

The binding legal principles established are: (1) Specific performance will be granted where there is a valid binding contract, a breach has occurred, the claimant specifically seeks specific performance, and damages would be inadequate; (2) Contractual clauses must be interpreted purposively and contextually, reading the entire contract together rather than isolating individual clauses; (3) A party purporting to repudiate a contract based on 'failure to successfully effect transfer' must demonstrate actual failed attempts to perform, not merely refuse to complete final steps; (4) Where a contract contains both a repudiation clause (clause 9) and a cancellation clause entitling the innocent party to seek specific performance (clause 10), the innocent party retains the right to elect specific performance when rejecting the repudiation; (5) The doctrine of sanctity of contracts requires that parties who have substantially performed their obligations and obtained benefits under a contract be held to their bargain; (6) A party cannot benefit from their own wrongful breach of contract, particularly where motivated by attempts to profit from changed economic circumstances.

The court made several non-binding observations: (1) The court noted it would not address the 'blue pen principle' as it was unnecessary given the conclusion on the main issue and questioned whether this principle has application in Zimbabwean jurisdiction; (2) The court observed that the respondents' conduct was motivated by greed, seeking to dispose of the property in foreign currency at higher current values rather than honoring the contract made in depreciated local currency; (3) The court commented that businessmen who wrongfully break contracts should not expect courts to simply award damages in money but should expect to be ordered to perform regardless of how costly that may be (citing the Intercontinental Trading case); (4) The court noted that allowing parties to walk away from substantially performed contracts would be highly prejudicial and contrary to the interests of any country; (5) The court observed that the respondents failed to explain what tax obligations would burden them if they finalized transfer, particularly since capital gains tax and stamp duty had already been addressed by the applicants.

This Zimbabwean High Court judgment is significant for reinforcing the doctrine of sanctity of contracts and the courts' willingness to grant specific performance in property sale transactions, particularly where substantial performance has occurred. The case establishes important principles regarding the interpretation of seemingly contradictory contractual clauses dealing with repudiation and cancellation, emphasizing that contracts must be interpreted purposively and contextually rather than in piecemeal fashion. The judgment serves as a strong warning to parties who seek to escape contractual obligations after receiving benefits, particularly in contexts of currency volatility and property appreciation. It clarifies that a party seeking to invoke a contractual right to cancel based on 'failure to effect transfer' must demonstrate actual attempts that failed, not merely refuse to perform final steps. The case also illustrates the application of equitable remedies where monetary compensation would be inadequate due to property appreciation and currency depreciation.