Trinity Engineering (Pvt) Ltd v Russell Karimazondo and Maxifix (Pvt) Ltd and Telecel Zimbabwe (Pvt) Ltd and People's Own Savings Bank and The Registrar of Deeds

Trinity Engineering (Pvt) Ltd (plaintiff), founded by Senator Aguy Georgias, entered into an agreement on 6 February 2011 with Maxifix (Pvt) Ltd (2nd defendant), a company owned by Russell Karimazondo (1st defendant), Georgias's son born out of wedlock. The agreement provided that Trinity would allow a mortgage bond of US$1 million to be registered over its property in favour of Telecel Zimbabwe (3rd defendant) as security for a roll-over facility for Maxifix to access airtime recharge cards. In return, Maxifix would pay Trinity certain sums and allow profit-sharing. Two mortgage bonds were subsequently registered: one for US$250,000 in favour of POSB (4th defendant) and one for US$1 million in favour of Telecel. Trinity later claimed both bonds were registered through forged signatures and sought to nullify them. Karimazondo initially confessed to forgery in a sworn affidavit and his first plea, but later recanted, claiming he signed under duress and that his father had actually signed the documents. The dispute involved family tensions between Georgias, his wife and daughters, and his newly-found son.

• Whether the plaintiff's duly authorized agent signed the power of attorney authorizing registration of the mortgage bond in favour of the third defendant
• Whether the mortgage bond in favour of the third defendant is valid
• Whether the plaintiff stood as surety and co-principal debtor for amounts owing by the second defendant to the third defendant
• Whether a power of attorney signed without proper witnesses (as alleged) can found a valid mortgage bond under s 78(a) of the Deeds Registries Act
• Whether extension of time to pay granted to the principal debtor releases a surety from liability

1. The plaintiff's claim was dismissed with costs on a legal practitioner and client scale. 2. The 3rd defendant's counter claim succeeded with judgment against the plaintiff and 2nd defendant jointly and severally for US$686,172.38 plus interest at 5% per annum from 1 May 2011 to date of payment. 3. The plaintiff and 2nd defendant to bear the 3rd defendant's costs on a legal practitioner and client scale.

A mortgage bond validly registered creates a separate and binding suretyship agreement between the mortgagor (surety) and mortgagee (creditor), independent of any tripartite agreement or underlying principal debt agreement. Where a party alleges forgery of a signature on a power of attorney to pass a mortgage bond, the party bears the onus of proving the forgery, and failure to adduce expert handwriting evidence will result in an adverse inference being drawn against that party. A party cannot approbate and reprobate by denying the validity of a mortgage bond while simultaneously relying on its terms to assert other defenses. Under the law of suretyship, an extension of time granted to the principal debtor after the debt has fallen due and the debtor is in mora does not release the surety, as the surety can avoid prejudice by paying when due and exercising rights of recourse. A mortgage bond registered in compliance with the formalities of the Deeds Registries Act, including a validly executed power of attorney witnessed as required by s 78(a), creates binding liability as surety and co-principal debtor.

The court made critical observations about the unreliability of the first defendant's evidence, noting he changed his story multiple times - from confessing to forgery in his initial plea and affidavit, to later claiming he acted under duress and his father actually signed. The court stated that where a witness has been shown to have lied, everything he says should be rejected as the court can never know when truth is told. The court also made pointed observations about the conduct of the plaintiff's legal practitioner, Muyengwa Motsi, whose testimony about when he first met Karimazondo was internally contradictory and incredible, though the court declined to make formal findings about professional misconduct due to the unreliability of the accuser. The court observed that family disputes involving children born out of wedlock create particular complications, noting the patriarch's comment that 'if one has children out of wedlock that creates problems.' The court suggested that pressure from Georgias's wife and daughters, rather than genuine concern about forgery, may have motivated the litigation. The judgment contains the colorful observation that resolving family disputes in court is 'the proverbial searching for a needle in a haystack.'

This case is significant for several reasons: (1) It confirms the principle that a mortgage bond creates a separate and binding suretyship agreement between the mortgagor and mortgagee, independent of any underlying principal agreement. (2) It demonstrates the importance of expert evidence in cases involving disputed signatures, with adverse inferences drawn against parties who fail to adduce such evidence. (3) It applies the principle that parties cannot approbate and reprobate - they cannot deny the validity of a transaction while simultaneously relying on its terms. (4) It clarifies that under Zimbabwean/South African law, extension of time granted to a debtor after default does not release the surety, following Estate Liebenberg v Standard Bank. (5) It illustrates when punitive costs on a legal practitioner-client scale are appropriate - where a party brings dishonest litigation to avoid commercial consequences of poor business decisions. (6) It demonstrates the court's scrutiny of witness credibility, particularly where witnesses change their stories or give contradictory evidence.