Silonda v Nkomo (6 of 2022) [2022] ZWSC 6 (25 January 2022)

Judgment No. SC 6/22 Civil Appeal No. SC 271/19 1 REPORTABLE

(6) JOEL SIMON SILONDA (SUBSTITUTED BY EXECUTOR VUSUMUZI THOMAS SILONDA) V VUSUMUZI NKOMO SUPREME COURT OF ZIMBABWE GUVAVA JA, UCHENA JA AND KUDYA AJA BULAWAYO: 21 JULY 2020 HARARE: 24 AUGUST 2020 & 25 JANUARY 2022 T. Masiye-Moyo and G. Ndlovu, for the appellant L. Nkomo for the respondent KUDYA AJA: This is an appeal against part of the judgment of the High Court sitting at Bulawayo, dated 2 May 2019. The court a quo granted the following order:

1. That the purported Deed of Sale concluded by the parties on 26 January 2010, in respect of a portion of Umguza 100 Acre Lot 5A be and is hereby confirmed to be null and void for want of compliance with the mandatory provisions of the Regional, Town and Country Planning Act [Chapter 29:12].

2. That the plaintiff’s claim for payment by the defendant of reasonable rentals and holding over damages be and is hereby dismissed with costs. Judgment No. SC 6/22 Civil Appeal No. SC 271/19 2

3. That the plaintiff be and is hereby ordered to pay to the defendant the sum of $125 000 being compensation for improvements effected by the defendant on the plaintiff’s property.

4. That the prescribed rate of interest be levied on the amount under (3), supra, with effect from 24 June 2015 to the date of full payment.

5. That the plaintiff pays costs of suit. The part under appeal relates to paras 3, 4 and 5 of the order. The appellant is also aggrieved by the court a quo’ s failure to pronounce itself on the claim for eviction in that

The Facts

The facts that are relevant to this appeal are common cause. The appellant sadly passed away on 24 August 2019, before the appeal was heard. He was, by order of this Court substituted on 22 July 2020 by his duly appointed executor dative, who also happens to be his son. The appellant is the registered title holder of Umguza 100 Acre Lot 5A in the District of Bulawayo measuring 67.2123 hectares held under deed of transfer No. 74/91 (the immovable property). It is situated in the outskirts of Bulawayo and falls under the administrative jurisdiction of the Umguza Rural District Council. On 17 August 2000, the appellant sought but failed to obtain a sub-division permit for the property into units of less than 5 hectares. The responsible authority adjudged any plots that were less than 5 hectares not to be viable for agriculture. Judgment No. SC 6/22 Civil Appeal No. SC 271/19 3 The respondent resided on a fully developed 6 acre plot in the vicinity of the appellant’s immovable property. On 12 January 2010, in anticipation of an agreement of sale to be consummated with the appellant, the respondent sold his plot for the sum of R 225

000. On 26 January 2010, the parties concluded a written agreement for the sale of 10 acres (4. 047 ha) of the immovable property (the plot) for the sum of US$20

000. A deposit of US$10 000 was to be paid before the respondent could take occupation. The balance was payable at the rate of US$2 000 per month from 1 May 2010. The other terms and conditions of the agreement were that the respondent would “pay the cost of all transactions connected with the transfer of the property, all charges of capital gains and draw electric power to the homestead of the seller”. The respondent duly paid the deposit and took occupation on 1 April 2010. His building plans were approved by the Umguza Rural District Council on 3 April 2010. He constructed a three bedroom cottage and a four bedroom main house in 2010. In 2011 he installed electricity infrastructure for his two dwellings and the appellant’s homestead but only drew electricity to his dwellings. He flushed a borehole previously sunk by the appellant, constructed 2 septic tanks and 2 Blair toilets. He also put up a perimeter fence around “his” plot. It was common cause that he expended the total sum of US$ 34 158.75 and R2 220 on these developments. The relationship between the appellant and respondent deteriorated soon after the respondent took occupation of the property. The appellant refused to accept the instalments tendered by the respondent and demanded that the respondent keep his money while he kept his land. The respondent tendered the balance of the purchase price and when it was rejected Judgment No. SC 6/22 Civil Appeal No. SC 271/19 4 he issued summons for specific performance in HC 491/11. Thereafter, with the help of their legal practitioners, a compromise was reached between the parties but was not honoured. In the result, the appellant then sued the respondent for the payment of the balance of the purchase price, in the sum of US$10 000, in HC 2828/12. During this tumultuous period, unbeknown to the respondent, the appellant sought to regularize the sale of the plot by applying for a sub-division permit to the department of Physical Planning Offices in Bulawayo on 10 January 2011. It was only in or about October 2012 that the respondent became aware that the appellant did not have a subdivision permit entitling him to subdivide the immovable property and sell the plot. On 27 February 2013, acting on the appellant’s request, the respondent paid US$550 to the appellant’s former legal practitioners for the processing of a belated subdivision permit. Notwithstanding that the immovable property measured 67.2123 ha, a permit for the sub-division of the immovable property into two stands measuring 4.047 and 37.6961 hectares was duly issued on 29 April 2013. The permit, however, turned out to be a fake document. Acting on the erroneous belief that the permit was genuine, on 6 June 2013 and 30 January 2014 the respondent paid US$5 000 and US$ 4 000, respectively, towards the purchase price. The respondent, therefore, paid to the appellant a total sum of US$19 000 for the purchase of the plot. He, in addition, expended US$34 158.75 and R2 220 in the development of the immovable property. Judgment No. SC 6/22 Civil Appeal No. SC 271/19 5 By the time a pre-trial conference was held a quo , both parties had withdrawn their earlier actions against each other. THE PARTIES’ RESPECTIVE CLAIMS IN THE COURT A QUO At the pre-trial conference, the parties agreed, inter alia, that their agreement of sale was invalid and illegal for breaching s 39(1)(i) and s 40 of the Regional, Town and Country Planning Act. This was because it had been concluded without a subdivision permit. Consequently, the appellant tendered the purchase price of US$19 000 and sought the eviction of the respondent from the plot. He also claimed an ascertainable amount for unjust enrichment for the period of the respondent’s stay to the date of his eviction. The quantum for the enrichment claim was based on what the appellant perceived to be the reasonable rentals that the respondent would have paid for the occupation of the property. He, therefore, claimed US$18 000 for the occupation of the plot from March 2010 to April 2015 and “holding over damages at the rate of US$10 per day…from 1 May 2015 to the date of vacation” and costs on the higher scale. The respondent contested the action. He disputed being unjustly enriched and averred that he was a bona fide occupier by virtue of the invalid agreement. He also averred that in the absence of a lease agreement, the appellant did not have a valid cause of action for the payment of reasonable rentals and holding over damages. He, in turn, counter claimed for unjust enrichment for the improvements he had made on the immovable property. He averred that the appellant was enriched at his expense by these improvements. He further alleged that the appellant was enriched by the payment of Judgment No. SC 6/22 Civil Appeal No. SC 271/19 6 US$19 000 towards the purchase price and US$550 for the procurement of the subdivision permit. The respondent, therefore, sought the repayment of the denominated amounts, a refund of the expenses incurred in erecting the electricity infrastructure and the depreciated replacement cost (being the current cost of reproduction or replacement of an asset less deductions for physical deterioration, obsolescence and optimization) of the improvements he made on the plot. He specially entreated the court to award him “such payments as will be sufficient to enable the defendant to purchase a property of comparable value including all the improvements he had effected.” He also sought interest at the prescribed rate from the date of summons to the date of payment in full and costs on the higher scale. In his plea to the counterclaim the appellant, again, tendered the refund of US$19

000. He disputed to being unjustly enriched by the developments made by the respondent on the immovable property. He averred that the respondent had failed to draw electricity to his homestead and had fraudulently facilitated the issuance of the fake permit. He also alleged that the respondent’s dwellings were constructed without his authority and that he was therefore a mala fide occupier. Lastly, he stated that these dwellings would not be useful to him. The two issues referred to trial a quo where whether or not:

1. The appellant was entitled to a reasonable rental arising from the respondent’s occupation of the plot, and

2. The defendant has been unjustly impoverished and plaintiff unjustly enriched as a result of the alleged developments made by the defendant upon the plot and if so the quantum thereof. Judgment No. SC 6/22 Civil Appeal No. SC 271/19 7 THE FINDINGS OF THE COURT A QUO The court a quo confirmed the invalidity of the agreement of sale on the ground that it was contrary to the mandatory dictates of ss 39 (1) (i) and 40 the Regional, Town and Country Planning Act. The confirmation was in accordance with established authority emanating from this Court in such cases as X-Trend –A Home (Pvt) Ltd v Hoselaw (Pvt) Ltd 2000

(2) ZLR 348 (S) and City of Gweru v Kombayi 1991

(1) ZLR 333 (S).

It held, on the authority of Magodora & Ors v Care International Zimbabwe 2014

(1) ZLR 397 (S) at p 398F that a lease agreement could not possibly be extrapolated from the invalid agreement of sale. And resultantly, dismissed the claim for rentals and holding over damages sought by the appellant in the main. It is clear from a reading of the judgment that the court a quo did not relate the request for reasonable rentals and holding over damages to the appellant’s own enrichment claim against the respondent. The appellant pleaded such a cause of action. He testified during the trial that the respondent derived benefit from the farming activities he conducted on the plot. He also asserted that another benefit that accrued to the respondent was in the form of rental savings that he would have been obliged to pay elsewhere but for his stay on the plot. These assertions were not and could not be controverted by the respondent. However, it appears that counsel for the appellant misconceived the appellant’s case and did not pursue the claim to fruition. The court a quo, on the basis of credibility findings and the probabilities of the case, further found the respondent to have been a bona fide occupier and the appellant a mala fide seller. Consequently, it relaxed the in pari delicto rule in favour of the respondent. It, thus, held that the appellant had been unjustly enriched at the expense of the respondent, who Judgment No. SC 6/22 Civil Appeal No. SC 271/19 8 was concomitantly impoverished by the transaction. The court a quo, therefore, upheld the respondent’s counter claim. In computing the measure of the benefit that accrued to the appellant, the court a quo applied the pari delictum rule. In the exercise of its broad discretion, it relaxed the pari delictum rule in a bid to do justice between the two protagonists. It had no difficulties in finding the appellant to have been enriched in the sum of US$19 550, constituted by the payments towards the purchase price and the facilitation of the procurement of the subdivision permit. The correctness of this finding is beyond question. After all, the appellant did not retract his tender of US$19 000, and conceded the payment of US$550 for the stated purpose. The parties disagreed on whether or not the respondent was entitled to compensation for the improvements that he made on the immovable property. The appellant submitted a quo that the respondent was not entitled to the value of the improvements. Firstly, because the respondent had not properly framed them under the enrichment cause of action in his pleadings. The second was that the improvements were not nor would they be useful to him. He, in any event, agitated for their urgent removal from his property.

The court a quo held that, while on the pleadings, the cause of action for the improvements was poorly and inelegantly framed, the respondent had obliquely included them in his enrichment cause. Further, that the purported defective pleadings had in any event been amplified and cured, firstly, by the inclusion of the developments in the second issue referred to trial at the pre-trial conference. And secondly, by the overwhelming evidence Judgment No. SC 6/22 Civil Appeal No. SC 271/19 9 adduced by the respondent at the trial together with the scope and tenor of the questions asked and answers rendered during cross examination. The court a quo also held on the authority of Reza v Nyangani 2001

(1) ZLR 202 (S) at 205G that usefulness was to be measured, objectively and not subjectively, on the basis of added value. It, therefore, found the improvements to be objectively useful to the appellant. It also found that they could not be removed because they were fixed to the immovable property. The court a quo estimated the added value of the improvements at $125 000 and not US$132 833.33 claimed by the respondent. It adopted the lowest depreciated replacement value of $90 000 provided in one of the three valuation reports produced in January 2018. The court a quo then added the depreciated replacement value of the plot, estimated in two of the valuation reports at $35 000, to this figure. It, therefore, awarded the aggregate amount of $125 000 to the respondent as a fair and equitable amount that adequately represented the enrichment that accrued to the appellant and constituted his concomitant impoverishment. Lastly, the court a quo declined to immediately evict the respondent from the immovable property on two grounds. The first was that he had a real improvement lien on the property, dischargeable on full payment of the award. The second was that the respondent had invested all the resources he had on the plot. To evict him from the plot, empty handed, would not only be intolerable but would consign him and his family to the indignity of homelessness and destitution. I quote below the concluding remarks of the court a quo in this regard. At p 15 of its cyclostyled judgment it stated that: “This Court firmly believes that this is a proper case to exercise its discretion in the interest of equity and fairness by ordering that the defendant be evicted only upon payment of the full compensation ordered by the court per the defendant’s counter Judgment No. SC 6/22 Civil Appeal No. SC 271/19 10 claim. This is mainly because the defendant has a real lien over the portion of the land in issue. (Underlining of the court a quo).” Notwithstanding the firm belief, the court a quo omitted to make the contemplated order of eviction in the final order that issued.