Venetian Blinds Specialists Ltd v Apex Holdings (Pvt) Ltd

The appellant sought recognition and enforcement in Zimbabwe of a judgment from the Supreme Court of Appeal of Malawi, which ordered the respondent to pay US$848,662.50 as special damages, Malawi Kwacha 120,928.50 with interest at 1% above the bank rate, and costs. It was common cause that the respondent had previously paid MK 4,819,512 to the appellant pursuant to an earlier High Court of Malawi judgment that was subsequently set aside on appeal. The respondent also paid Z$50 billion into court following institution of proceedings in Zimbabwe. The High Court dismissed the appellant's claim, finding that the respondent had fully discharged its indebtedness based on a conversion of the MK payment to US dollars using a rate of MK 4.4788 to one US dollar, concluding the respondent had paid over US$1 million.

• Whether the High Court misdirected itself in determining the exchange rate applicable to convert the Malawian Kwacha payment to US dollars without proper evidence
• What exchange rate should be applied to determine the value of the MK 4,819,512 payment made by the respondent
• Whether interest should be applicable to the US$848,662.50 awarded by the Supreme Court of Malawi, and if so, at what rate
• Whether the respondent had fully discharged its debt to the appellant

1. The judgment of the High Court was set aside. 2. The matter was remitted to the court a quo to make a determination after hearing evidence on: (a) the rate of exchange applicable at the time of payment of the MK 4,819,512; and (b) the rate of interest applicable, if any, to the sum of US$848,662.50 awarded by the Supreme Court of Malawi. 3. Each party was ordered to pay its own costs.

When a court is required to determine the exchange rate applicable to convert a payment made in foreign currency, proper evidence of the prevailing exchange rate at the time of payment must be placed before the court. A court misdirects itself if it accepts unsubstantiated testimony regarding exchange rates without proper evidentiary foundation. Where neither party has led sufficient evidence on material issues such as applicable exchange rates and interest rates in foreign judgment enforcement proceedings, the matter should be remitted to allow proper determination after evidence is heard.

The court observed that the respondent's payment of Z$50 billion into court following institution of proceedings in Zimbabwe suggested that the respondent itself must have appreciated that it had not fully discharged its indebtedness to the appellant. This indicated consciousness on the respondent's part that the debt remained outstanding despite the earlier Malawian Kwacha payment. The court also noted that where both parties are at fault in failing to place issues correctly in pleadings, the appropriate costs order is for each party to bear its own costs rather than costs following the event.

This case establishes important principles regarding the recognition and enforcement of foreign judgments in Zimbabwe, particularly concerning the evidentiary requirements for determining exchange rates when payments have been made in foreign currency. It emphasizes that courts cannot accept unsubstantiated testimony on exchange rates and must have proper evidence before them to make determinations on currency conversions. The case also highlights the courts' willingness to remit matters for proper determination when parties have failed to properly plead or prove essential issues, particularly where both parties share responsibility for the deficiency in evidence. It demonstrates the Supreme Court's approach to costs where both parties are at fault in failing to place issues correctly in pleadings.