House of Vengesai (Pvt) Ltd t/a Vengesai Architects v Minister of Tourism and Hospitality (284 of 2024) [2024] ZWHHC 284 (2 July 2024)

HOUSE OF VENGESAI (PVT) LTD t/a VENGESAI ARCHITECTS versus MINISTER OF TOURISM AND HOSPITALITY HH 284 - 24 HC 4921/16 HIGH COURT OF ZIMBABWE MANYANGADZE J HARARE, 19 July 2023 & 2 July 2024 Unopposed application Mr B. Mataruka, for the plaintiff/applicant Defendant/respondent in default MANYANGADZE J: The parties in this matter have been engaged in protracted litigation that commenced with the plaintiff issuing summons against the defendant in May 2016. In the summons, the claim is stated as follows: b) a) “Payment in the total sum of ($30 286 747.86) Thirty Million Two Hundred and Eighty-Six Thousand Seven Hundred and Forty-Seven United States Dollars and Eighty-Six Cents. Interest on the above amount from 15 February 2016 being date of demand to date of full payment. c) Costs of suit. Being payment for architectural services rendered by Plaintiff to defendant at Defendant’s specific request and instance during the period extending from (sic) to 2013 in Victoria Falls, which amount despite demand remains due and payable.” In a judgment handed down by this court in January 2023, the defendant’s plea was struck out for being fatally defective, resulting in the matter being dealt with as an unopposed matter. In that judgment, the court made the following order: “1. The defendant’s plea be and is hereby struck out. 2. The plaintiff shall take the necessary steps to set the matter down for hearing of evidence to substantiate its claims against the defendant. 3. The defendant shall bear the plaintiff’s costs.” Pursuant to this order, the plaintiff filed the instant application, being an application for default judgment, to which it attached an affidavit of evidence substantiating its claims against the defendant. Oral submissions were also made on behalf of the plaintiff, motivating the application. HH 284 - 24 HC 4921/16 The factual background to this matter is fully captured in Judgment No. HH 36/23, in which the above-cited order was granted. In brief, it is that the Government of Zimbabwe, in anticipation of hosting the United Nations World Tourism Organization (UNWTO) international conference on tourism, planned to construct massive multi-purpose tourist facilities, which would include shopping malls, restaurants and hotels. The conference was scheduled for 2013, at the resort town of Victoria Falls. The planning and consultative meetings started in 2011, meaning there was a two-year timeframe within which the said facilities were to be built. To this end, the plaintiff was engaged to provide architectural designs for the project, referred to in the pleadings as WTO Convention Centre Victoria Falls (‘the project”). The defendant, being the Government Minister responsible for tourism, was head of the focal ministry on the project, and represented Government as the plaintiff’s client. According to the plaintiff’s declaration, the plaintiff designed and provided working drawings for the following facilities, and charged the fees indicated. The amounts indicated are in United States dollars. The project was negotiated during the period the country had introduced the multi-currency system, of which the United States dollar was the dominant and preferred currency. Multi-Purpose Warehouse Presidential Villas Bed & Breakfast Apartments Carnivore Restaurant 120 000 m2 Shopping Mall 350-bed 3 Star Hotel 20 000 m2 Shopping Mall 150-bed 3 Star Hotel TOTAL COST = = = = = = = = = $ 1 572 889.98 $ 9 459 267.44 $ 3 118 860. 39 $ 836 887.26 $ 9 159 624. 11 $ 4 655 429.90 $ 929 028.14 $ 551 633.98 $ 30 286 747. 86 In paragraphs 16-17 of its affidavit of evidence, the plaintiff indicates that the defendant reduced the initially planned 120 000 square-metre shopping mall to 20 000 square metres, and the 3 star 350-bed hotel to a 150-bed hotel. This resulted in a downward variation of the total amount claimed to US$28 804 019.58, which is the amount reflected in the draft order. HH 284 - 24 HC 4921/16 In clarifying the claims, Mr Mataruka, for the plaintiff, explained that the claims were based on a percentage of the expected cost of construction in respect of each facility. No fees for supervision of the actual construction were levied, as the construction had not yet commenced. The claims were for the working drawings or architectural designs done by the plaintiff, on which the construction was to be based. He further indicated that the estimated cost of construction was done by the defendant’s quantity surveyors and consultants appointed by the defendant. Mr Mataruka also explained how the amounts claimed were computed. Computation was based on the Architects (Conditions of Engagement and Scale of Fees) By – Laws, SI 829 of 1980 (Second and Third Schedule). In terms of these regulations, the architect’s fees are 6% of the cost of construction. He clarified that since there is no actual construction involved in this case, the plaintiff claims 75% of the 6 %. It is not the full 6% that is due. This translates to an actual claim of 4.5 % of the cost of construction. This reduction is due to the exclusion of supervision fees, which are claimed when the architect supervises construction of the structures based on his designs. Mr Mataruka emphasized that the exclusion of supervision fees shows that there is no unjust enrichment, as the plaintiff is claiming only that which it is entitled to. What has thus been laid out is evidence substantiating the plaintiff's claims. There is no evidence in rebuttal from the defendant, this being an unopposed matter. The defendant took no steps required by law to rectify his default. Given the magnitude and complexity of the claims, it was reasonably expected that the defendant would do everything necessary to ensure that the claims are contested. This is despite the fact that the court indicated, in its judgment, that it was open to the defendant to take the necessary measures to rescue himself from the default position he had fallen into. Even the plaintiff expected that the defendant would put his house in order. This is reflected in the following remarks, on p 7 of the judgment: “Meanwhile, it is open to the defendant to take the necessary steps to extricate itself from the legal predicament it has placed itself in. Even the plaintiff suggested as much. This is reflected in remarks made by Advocate Zhuwarara during oral submissions; We urge the court to find the defendant in default. They (defendant) will then put their house in order by making an appropriate application.” HH 284 - 24 HC 4921/16 The defendant did not put his house in order as suggested, leading to the instant application by the plaintiff. The plaintiff having duly complied with the court’s order to substantiate its claims, it is entitled to judgment as prayed for. The court could not go into a meaningful and informed interrogation of the plaintiff’s quantification of its claims in the absence of evidence and submissions in rebuttal from the defendant. As already indicated, the defendant disabled himself by not dealing with his default in terms of the law. The court cannot go out of its way to assist a litigant who is in default. If the non-defaulting party/s papers are in order, and the relief sought is one that the court can competently grant at law, then nothing precludes the plaintiff from obtaining relief. In this regard, the court agrees with the sentiments expressed by Mr Mataruka during his oral submissions; “The defendant had ample opportunity to defend the claim. It hasn’t. The court cannot come to the aid of a litigant that is not before it.” The court asked the plaintiff to address it on the applicability of SI 33 of 2019, Presidential Powers (Temporary Measures) (Amendment of Reserve Bank of Zimbabwe Act and Issue of Real Time Gross Settlement Electronic Dollars (RTGS Dollars)) Regulations. This question arises from the fact that the liability in question was incurred on 15 February 2016, being the date of demand. SI 33 of 2019 expressly provides, in s 4 (1)(d), that all assets and liabilities denominated in United States dollars immediately before the effective date shall, on or after the effective date, be deemed to be valued in RTGS dollars at a rate of one- to-one to the United States dollar. The court raised such a query mindful of the fact that it was dealing with an unopposed matter. However, the fact that a matter is unopposed does not mean that the court cannot seek clarification on legal issues affecting the matter. It appeared counsel for the plaintiff had not come prepared for such an issue. He indicated that he was prepared to file detailed submissions, should the court direct that these be filed. It must be noted that this is a matter where the parties have been engaged in litigation for nearly a decade. Holding it in abeyance will unduly prolong an already long-drawn-out legal battle. The matter being unopposed, there seems to be no justification for further delays. In the circumstances, the court is of the considered view that it can go ahead and grant the order prayed for, as specified in the draft order. It is an order the court can competently grant. Should the question of the applicable rate arise, it is a legal issue affecting enforcement of the judgment – whether it should be in United States dollars as granted in the court’s order, HH 284 - 24 HC 4921/16 in RTGS at the rate prescribed in SI 33/19, or in Zimbabwe Gold (ZiG) at the prevailing rate. This is a question the court was not seized with. It will constitute a separate cause of action affecting execution, should it be raised at that stage. The court has dealt with quantification of the plaintiff’s claims in the currency in which such claims were raised at the time of demand, which was in February 2016. In the result, it is ordered that: - 1. The application for default judgment be and is hereby granted. 2. The defendant pays the plaintiff the amount of US$28 804 019.58 (Twenty-eight million eight hundred and four thousand and nineteen United States dollars fifty- eight cents) being the total cost of architectural services rendered by the plaintiff to the defendant at the defendant’s instance and request. 3. Interest on the above amount from 15 February 2016, being the date of demand, to date of full payment. 4. The defendant pays the plaintiff’s costs of suit on an attorney and client scale. MANYANGADZE J: ................................................. Gill, Godlonton and Gerrans, plaintiff’s legal practitioners Civil Division of the Attorney General’s Office, defendant’s legal practitioners