Ubuntu Bethu Mining (Pvt) Ltd t/a Ubuntu Bethu Mining (Pvt) Ltd v ABJ Engineering (Pvt) Ltd

In early 2013, the plaintiff company, represented by Sebastian Ncube, purchased a stamp mill from the defendant through the defendant's employee Ephraim for a total purchase price of US$43,700. The parties agreed that payment could be made in instalments, contrary to the defendant's usual policy of requiring 50% down payment before commencing work. The plaintiff paid a total of US$26,700 towards the purchase price, with the last payment made on 27 February 2014. The stamp mill was expected to be completed by February 2014 but was not delivered. Both companies experienced challenges. According to the plaintiff, a cancellation agreement was reached between Mr. Ncube and Ephraim, under which the plaintiff would be refunded the deposit paid. The defendant made two payments totaling US$5,000 to the plaintiff, described in internal documents as a "refund". The defendant's director, Michael Querl, who became involved later, claimed the payments were "assistance" for medical expenses when Mr. Ncube was hospitalized, not a refund, and that there was no cancellation agreement. The plaintiff claimed the balance of US$21,700, either as a refund under the cancellation agreement or alternatively as unjust enrichment.

• Whether the parties agreed to cancel the sale agreement for the stamp mill
• Whether the cancellation agreement included a term that the defendant would refund the deposit paid by the plaintiff
• Whether the payments of US$2,000 and US$3,000 made by the defendant to the plaintiff constituted a 'refund' or merely 'assistance' for medical expenses
• Alternatively, whether the defendant was unjustly enriched at the plaintiff's expense to the extent of US$21,700

1. Payment of US$21,700 or its RTGS dollar equivalent at the inter-market bank rate on the day of payment, being either a refund of part of the purchase price paid by plaintiff to defendant for the manufacture of a stamp mill or alternatively the amount by which defendant has been unjustly enriched at the expense of the plaintiff. 2. Costs of suit.

Where parties enter into a contract of sale and subsequently agree to cancel that contract with a refund of monies paid, contemporaneous documentary evidence describing payments as "refunds" will be given greater weight than subsequent contradictory testimony. The principle of unjust enrichment will apply where: (a) the defendant is enriched; (b) the plaintiff is impoverished by that enrichment; (c) the enrichment is unjustified; (d) the enrichment does not fall within classical enrichment actions; and (e) no rule of law refuses an action to the impoverished person. Where a defendant fails to plead specifically to an alternative claim as required by Rule 104(2) of the High Court Rules, 1977, that claim shall be taken as admitted. A party cannot escape liability by claiming that junior employees lacked authority to make agreements when senior management subsequently ratified those agreements through conduct, including approving payment requisitions and making payments pursuant to those agreements.

The court observed that it would be naïve to read correspondence and documentary exhibits in isolation; they should be read in context and together. The court noted that Ephraim's testimony appeared "muddled and conveniently made to suit what his employer would want to hear" and that he tended to testify about company procedures and what "normally happens" or "should have happened" rather than what actually occurred. The court commented that Mr. Querl appeared to be attempting to "correct" or undo what Ephraim and the accounts department had already done, but that the crucial agreements had already been concluded before his involvement. The court expressed skepticism about the defendant's claim that the plaintiff would have to be "a genius" or "a rare breed of a genius" to create the detailed, time-stamped email correspondence if there had been no prior cancellation and refund agreement. The court noted the suspicious nature of a written response (dated 17 June 2016) coming five months earlier than the alleged verbal request it purported to respond to (claimed to be 2 November 2016).

This case is significant for several reasons: (1) It demonstrates the importance of credibility findings in commercial disputes where the existence of an oral agreement is contested. (2) It illustrates how contemporaneous documentary evidence (internal company documents, emails, bank records) can contradict subsequent testimony and establish the true nature of transactions. (3) It confirms the strict pleading requirements under Rule 104(2) of the High Court Rules, 1977, particularly that any allegation in a declaration not specifically dealt with shall be taken as admitted. (4) It applies the principles of unjust enrichment as established in Industrial Equity Ltd v Walker 1996 (1) ZLR 269 (H), confirming that where a defendant fails to plead to an alternative claim of unjust enrichment, it may be deemed admitted. (5) It addresses the authority of employees to bind companies in commercial transactions and the consequences when senior management later attempts to repudiate agreements made by junior staff, particularly where the senior management subsequently ratified those agreements through conduct (such as approving payment requisitions). (6) The case emphasizes that internal company documents bearing the signatures of directors carry significant evidentiary weight, particularly when they contradict the director's later testimony.