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Zimplats wins in community share ownership trust dispute



ZIMBABWE Platinum Mines (Private) Limited (Zimplats) has won a case in which it was being sued by a community member on accusations of failing to give back to the community despite thriving financially.

The Mhondoro Ngezi-based mining company was at loggerheads with Tatenda Gwinji, a community member, who sought declaratory and consequential relief including an order declaring that Zimplats is obliged to allot to the trust ordinary shares in the share capital of Zimplats constituting 10% of issued share capital.

However, High Court High Court judge Jacob Manzunzu dismissed Gwinji’s application, ruling that he failed to support his claim.

This was after hearing arguments from the mining company and other respondents including Zimplats Mhondoro Ngezi Chegutu Zvimba Community Share Ownership Trust (the Trust), Industry and Commerce minister, Zimplats head corporate affairs Sibusisiwe Chindove and Godfrey Sigobodhla as second to fifth respondents respectively.

“Mr Mugabe for the plaintiff was put on a hill start. He was brief. He agreed that as a general rule, an agreement to agree was unenforceable,” said Justice Manzunzu.

“He created a duty for himself to assist the court, as to what are the exceptions and whether this case falls within the exception. He fought, but in my view, a losing battle.”

Justice Manzunzu said given the non-fulfilment of the condition precedent, it logically follows that Gwinji cannot seek to enforce any rights emanating from clause 3.2 or 3.3 of the trust deed.

“The plaintiff has not established any valid cause of action. The exception ought to be upheld. It disposes of the plaintiff’s claim. In that event, it is pointless to deal with the special plea,” he ruled.

“The exception to the summons and declaration by Zimplats and Chindove is upheld with costs. The plaintiff’s claim be and is hereby dismissed.”

Gwinji filed his court application on 21 November 2022 in terms of section 14 of the High Court Act.

Under this section, Gwinji sought a declaratory and consequential relief including an order declaring that the Trust is entitled to subscribe to, and Zimplats is obliged to allot to the trust, ordinary shares in the share capital of Zimplats constituting 10% of the issued share capital.

This, he said, was also in terms of clause 3.2 of the trust.

Gwinji also sought an order declaring that Zimplats’ failure and/or neglect to comply with clause 3.2 of the trust deed was ultra vires section 13 of the constitution of Zimbabwe, 2013 and regional and international instruments to which Zimbabwe is a state party in respect of his right to national development.

He wanted the court to consequently make an order that, within 14 days of this order, Zimplats execute with the trust a subscription agreement relating to the community shares in terms of clause 3.3 of the trust plus costs of suit on the legal practitioner and client scale.
Zimplats is a private limited company duly incorporated under the laws of Zimbabwe.

It is involved in platinum mining in the Mhondoro Ngezi area.

Under the indigenisation laws, it was a requirement that Zimplats submit an indigenisation implementation plan.

According to court papers, it did so by expressing its intention to allot 10% of its issued shares to the local community in which it carries out its platinum mining activities.

“To that end, on 13 October 2011, a memorandum of understanding (‘the MOU’) was signed between the Government of Zimbabwe and Zimplats.The MOU recorded that a community share ownership trust (‘the Trust’) would be set up for the benefit of the various communities affected by Zimbabwe Platinum’s mining activities,” said Gwinji.

The court heard it was further recorded that Zimplats would dispose of 10% of its issued share capital to the trust for fair value, on terms and conditions to be agreed upon.

The MOU further acknowledged that the disposal of the shares was subject to, inter alia, the execution of definitive agreements relating to the disposal of the shares to the trust, including a share sale agreement between Zimplats and the trust.

On 11 December 2011, a trust deed was registered in the Deeds Registry which effectively gave birth to the trust, being the 1st defendant in this matter.

Gwinji’s cause of action is premised on clauses 3.2 and 3.3 of the trust deed.

He submitted that despite Zimplats making profits and declaring dividends, it has refused and/or neglected to allot to the trust ordinary shares in its share capital constituting 10% of the issued share capital.

He attributed the delay and/or failure to give birth to the subscription agreement to Zimplats.

Gwinji instituted this action in his personal capacity as a resident and beneficiary of the trust and in the public interest on behalf of other residents and communities who are beneficiaries of the trust.

Chindove and Sigobodhla were cited in their official capacity as founding trustees of the trust.

Zimplats and Chindove raised an exception to the summons and declaration in that they do not disclose a cause of action.

They also raised special pleas, that of prescription, lack of “locus standi of the plaintiff; and that the court has no jurisdiction to deal with the action which is not commercial dispute.”

They argued that both the MOU and the trust deed provide that the allotment of shares will be subject to the execution of the subscription agreement. — STAFF WRITER.

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