Arifor Private Limited v Puroil (Private) Limited and 2 Others (739 of 2022) [2022] ZWHHC 739 (21 October 2022)

1 HH739/22 HCHC335/22 Ref HCHC196/22 AFRIFOR PRIVATE LIMITED versus PUROIL (PRIVATE) LIMITED and TENGRUP ENERGY (PRIVATE) LIMITED and ECOBANK ZIMBABWE LIMITED 3rd RESPONDENT 2nd RESPONDENT 1st RESPONDENT APPLICANT HIGH COURT OF ZIMBABWE NDLOVU J HARARE, 17 & 21 October 2022 OPPOSED ANTI DISSIPATION – APPLICATION T. B. Kativu with O. Kondongwe, for the Applicant T. Chagonda, for the 1st & 2nd Respondents No appearance – for the 3rd Respondents NDLOVU J: This is an Urgent Chamber application for an anti-dissipation order filed by the Applicant on the 13th of October 2022 seeking the following relief. “TERMS OF FINAL ORDER SOUGHT. That you show cause to the Honourable Court why a final order should not be made in the following terms- 1. The 1st Respondent be and is hereby barred from transferring the sum of (USD360,000.00 (United States Dollars Three Hundred and Sixty Thousand) pursuant to the default order granted in case number HCHC 196/22 pending the finalization of application for rescission of judgment filed under case number HCHC333/22. 2. The 3rd Respondent be and is hereby directed to freeze the 1st Respondent’s account number 5783600015494 pending the finalization of the dispute between Applicant and 1st Respondent filed under case number HCHC333/22. 3. The 1st and 2nd Respondents shall pay costs of suit for this application. HH739/22 HCHC335/22 Ref HCHC196/22 INTERIM RELIEF GRANTED Pending the return date, the Applicant is granted the following relief. 1. The 1st and 2nd Respondents be and is hereby ordered not to dissipate the sum of (USD 360,000.00 (United States Dollars Three Hundred and Sixty Thousand) transferred from the Applicant’s account into its bank account with 3rd Respondent pursuant to the default order granted in case number HCHC 196/22. 2. The 3rd Respondent be and is hereby directed to freeze the 1st and 2nd Respondent’s account number 5783600015494 pending the finalization of the dispute between Applicant and 1st Respondent filed under case number HCHC 333/22.” BACKGROUND FACTS The 1st & 2nd Respondents obtained a default judgment against the Applicant on 10 October 2022 under case number HCHC 196/22. A writ of delivery was issued and executed on 13 October 2022 and the Applicant says it became aware of the default judgment on 12 October 2022. On 13 October 2022 the Applicant filed an application for rescission of the default judgment. Under case number HCHC 196/22 the Applicant features as a 2nd Respondent and the 1st & 2nd Respondents herein are the Applicants who are seeking an order that the Applicant herein and a party cited as the 1st Respondent therein return US$360,000.00 held in the Applicant’s Bank Account. The Applicant defaulted filing its Notice of Opposition timeously in HCHC 196/22 thereby causing the 1st & 2nd Respondents herein to apply for a default judgment against it. They were successful after the court dismissed the Applicant’s counter application for the upliftment of the Bar and condonation for late filing its Notice of Opposition. In its judgment, the court held that the Applicant had been in wilful default and had no prospects of success in the main matter. APPLICANT’S CASE In essence, the Applicant contends as follows; HH739/22 HCHC335/22 Ref HCHC196/22 (1) That its application for rescission of judgment enjoys prospects of success in that it has a bona fide defence in the main matter under HCHC 196/22 where it also has prospects of success. The bona fide defence according to the Applicant is born out of the fact that the 1st & 2nd Respondents should be seeking reimbursement from the company they contracted with, R Powered, and not the Applicant who according to it, is an innocent 3rd party in the matrix and never dealt with the 1st & 2nd Respondents. It only received the money from the 1st Respondent in HCHC 196/22 and held it in its Bank account as security for a loan advanced to some individual in South Africa by its sister South African company. (2) It has a prima facie right to challenge the default judgment by way of a rescission application. The Applicant further argued that; it has established its prima facie right to the funds in question and therefore met the requirement to entitle it to the order sought even though since the deposit of US$360 000.00 into the account more than that figure has been dissipated causing it to amend the sum of money in issue to US$17 939.70 from US$360 000.00 in line with what is currently in the 1st Respondent’s Bank account which money will be available when the Applicant finally succeeds in the main matter. Amending the figure has therefore cured the defence by the Respondents that the funds have already been dissipated. That it holds a well-grounded apprehension that this prima facie right stands to be infringed upon resulting in it suffering irreparable harm if this interlocutory order is not granted and the 1st & 2nd Respondents dissipate the funds and be unable to compensate it rendering the rescission application on academic exercise. That this application is the only remedy at its disposal to cure that harm and the balance of convenience favours that the relief sought be granted. (3) The Applicant also contended that the merits or demerits in the rescission application may be in dispute in this matter however such a dispute does not displace its prima facie right which is constituted by that pending rescission application. Although mala fides are not part of the requirements for an anti-dissipation relief, the manner and speed with which the 1st & 2nd Respondents executed the court order is an exhibit that they conducted themselves with bad motives akin to snatching a judgment, a practice frowned upon by the courts. That the 3rd Respondent, the owner of the US$17,939.70 did not oppose the application and is capable of trading even if the US$17,939.70 is frozen. HH739/22 HCHC335/22 Ref HCHC196/22 1ST AND 2ND RESPONDENTS’ CASE In their Notice of Opposition, the 1st & 2nd Respondents have attached documentary evidence showing that funds in excess of US$360,000.00 had already been dissipated from the 1st Respondent’s Bank account before this application was filed, leaving a balance of US$17,939.70 in the account. They thrust their opposition and argument on the following; (1) That an order for anti-dissipation sought by the Applicant cannot be granted in this case because the funds have already been dissipated by the 1st Respondent. The relief sought in the rescission application cannot be competently granted by this court because in dismissing the Counter Application for condonation and upliftment of the Bar the court dealt with and made a finding on the reasonableness of the explanation for the failure to file timeously and prospects of success in the main matter and therefore in the rescission application the Applicant is seeking that this court revisits its own decision, yet that judgment is extant. (2) That the Applicant has not established a prima facie right, although open to doubt, to the funds, an extant court order is to the effect that the Applicant is not entitled to those funds, filing a rescission application does not qualify as a prima facie right. It cannot be said that the 1st and 2nd Respondent acted mala fide in receiving the funds. They were executing a court order and as such, there is no justification to interfere with their dissipation of the funds; neither are mala fides established justifying the anti-dissipation of the US$17,939.70 as before the deposit of US$360,000.00 there was US$23 766.22 in the account and/or freezing a trading company’s Bank account. THE LAW The requirements for an anti-dissipation interdict are the same as those for a prohibitory interdict. The Applicant must establish the following to succeed. (1) It has a prima facie, although open to doubt, right. (2) That an infringement of such a right is imminent. (3) That it will suffer irreparable harm if the interim relief is not granted. (4) That there is no other satisfactory remedy. (5) That the balance of convenience favours the granting of such an interdict. See Bozimo Trade & Development Co. P/L -v- Merchant Bank of Zimbabwe and Otrs 2000(1) ZLR 1 (H) and Mine Mills Trading Private Limited & Otrs -v- NJZ Resources (HK) HH739/22 HCHC335/22 Ref HCHC196/22 Limited SC40/2014 RESOLUTION Prima facie right This is the major hurdle an Applicant in such an application has to surmount. In this matter, this court has already made a finding that the Applicant has no right to the money constituting the subject matter of this application, when it dismissed the Applicant’s counter application for condonation in case number HCHC 196/22 on 10 October 2022. That judgment is extant. To then say the Applicant has a prima facie right to the same funds would be tantamount to this court reviewing its own decision and that would be incompetent. The Applicant has therefore failed to surmount the first hurdle. The conclusion reached on this requirement puts paid to any other contention, however out of an abundance of caution l will proceed to determine them. Infringement of the right. There is no possible imminent infringement of the right to talk about in this matter because the court has already decided against the Applicant in respect of its perceived right to the funds or to hold onto the funds question. Irreparable harm Assuming against all odds that somehow the Applicant finds its way back to defending the application against it and others in the main matter and succeeds in that matter, it can always execute against the 1st & 2nd Respondents. There is simply no harm, let alone irreparable, to be suffered by the Applicant if the interim relief is not granted in its favour. Other satisfactory remedies As already indicated in the preceding paragraph, in the unlikely event that the Applicant is successful in its defence, it can always execute against the 1st & 2nd Respondents. In any case, the Applicant was indemnified by the 1st Respondent in the main matter in respect of these funds. HH739/22 HCHC335/22 Ref HCHC196/22 Balance of convenience The balance of convenience in this matter does not favor the Applicant because the 1st & 2nd Respondent are executing an extant judgment of this court. The 1st Respondent’s possession and use of those funds has been lawful. There is no convenience in a court indirectly and unnecessarily revisiting its judgment that went against a party, through an application like this. I find no basis to order a freeze on the 1st Respondent’s Bank account in the Books of the 3rd Respondent in the circumstances of this case. On the above reasons and in the exercise of the discretion reposed in me the Applicant’s application fails and therefore; IT IS HEREBY ORDERED THAT The application for an anti-dissipation order be and is hereby dismissed with costs. Dube, Manikai & Hwacha, Applicants Legal Practitioners Atherstone & Cook, 1st & 2nd Respondents Legal Practitioners