TWO BUYERS, SAME PROPERTY? A SYNOPSIS ON DOUBLE SALES.

By Bright Maponga

It has happened for so long and it still happens that two innocent land seekers buy the same property from the same seller. This has been commonly referred to as “double sales”. This scenario is not new to the Zimbabwean market and is even more prevalent in the recent times where corruption has reached its zenith. What happens in that situation is what this writing seeks to clarify?

2.   As far back as the year 2000, the Highest Court of Appeal being the Supreme Court faced with a double sale scenario settled the law. This was in the case of GUGA v MOYO 2000 (2) ZLR 458 (S) wherein the court per McNally JA (as he then was) held that,

The basic rule in double sales where transfer has not been passed to either party is that the first purchaser should succeed. The first in time is the stronger in law. The second purchaser is left with a claim for damages against the seller, which is usually small comfort. But that rule applies only in the absence of special circumstances affecting the balance of equities.

3.      What appears clear from this judgment is as follows:-

i)               in the absence of “special circumstances affecting the balance of equities”, the first purchaser is entitled to the property in dispute;

ii)                 second purchaser is left to face the seller for damages for breach of contract and

iii)               (i) and (ii) can only happen where transfer has not yet been passed.

 

4.      By simple logic, it also appears clear that there are instances where the second purchaser will succeed, leaving the first purchaser with a claim for damages against the seller. This is where there are “special circumstances affecting the balance of equities”. The court highlighted the special circumstances as follows:-

i.)                 the purchase price paid by the parties,

ii.)               whether any of the parties had taken possession,

iii.)             any improvements on the property,

iv.)             whether the second purchaser was not aware of the earlier sale and

v.)                where transfer has taken place.

 

5.      If the balance of equities favour that the property be given to the second purchaser, the court will so award.

6.   For the avoidance any reasonable doubt, the position of law per Guga v Moyo (supra) is as follows, where transfer has not yet been transferred to either purchaser, the first purchaser should succeed unless there are “special circumstances affecting the balance of equities” which will then allow the second purchaser to succeed. The reasoning being that once transfer has been passed, the person to whom it has been passed remains the owner unless fraudulently transferred to him/her/it.

7.   In the recent judgment of the High Court per MUZOFA J in Zimunya & Anor v Shumba & Ors [2022] ZWHHC 1, the learned judge quote with approval the speech by McNally J (as he then was) in Guga v Moyo (supra) as follows;

In the leading case of Guga v Moyo 2000 (2) ZLR 458 (S) the court dealt with issues of double sales. The general principle is that where a double sale takes place, and transfer has not passed the first purchaser should succeed unless special circumstances dictate otherwise. The first in time is the stronger. The onus is on the second purchaser to establish the special circumstances. Courts will not lean in favour of a second purchaser who had knowledge of the earlier sale. Such a purchaser ceases to be a bona fide purchaser. See Charuma Blasting & Earthmoving Services (Pvt) Ltd v Njanji & Ors 2000(1) ZLR 85 (S).

8.   In the Zimunya case (supra), the court went on to consider the “special circumstances affecting the balance of equities” and came to following conclusion;

In this case the applicants paid US$6000 for both plots. This excludes the development levies. They did not take possession neither did they effect any improvements on the property. The third respondent paid US$17400 for the property. The court accepts that he took possession and made some considerable improvements on the property. The applicants disputed that the photographs relate to the property. However, this remained a bare disputation nothing was placed before the court to show otherwise. Having taken possession, the third respondent effected some improvements on the property by building a house although it was not fully described, erected a perimeter fence and a borehole. The third respondent aver that he was a bona fide purchaser who was unaware of the earlier sale. The applicants again disputed this point, but they did not favour the court with evidence to substantiate their point. In my view the third respondent established special circumstances to tilt the balance in his favour. The justice of this matter dictate that the application must not be granted.

9.      In other words, having considered the “special circumstances affecting the balance of equities”, the court granted the property to the second purchaser.

10.  In summary, dynamic the law as it is, the law in relation to double sales has not changed. The first seller succeeds unless there are special circumstances which will allow the second purchaser to succeed. This is just the general rule BUT each case will depend on its own circumstances.

Disclaimer: This article is for information purposes only and legal advice should be sought from legal practitioners.

Bright Maponga is among other things a legal practitioner and a writer who writes in his personal capacity.

+263 786256538, +263 718293826

Email: brytmaponga@gmail.com

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