Zimpapers Logo

Mashudu Netsianda, Senior Reporter
THE legal battle pitting Choppies Enterprises Limited against former Vice-President Phelekezela Mphoko and his son Siqokoqela over the 51 percent shareholding that they claim at the retail giant will now proceed to trial.

This follows the decision by Bulawayo High Court judge Justice Martin Makonese to dismiss the exception plea raised by the Choppies Enterprises Ltd.

In legal terms, an exception is pleading in which a party raises an objection to the summons or plea on the basis that the pleading is vague and embarrassing or lacks the necessary averments to disclose a cause of action or defense.

Choppies Enterprises, through its lawyers Dube-Banda, Nzarayapenga Legal Practitioners, sought an exception to the Mphokos’ summons and declaration on the grounds that the cause of action is vague and embarrassing.

Choppies Enterprises, Choppies Distribution Centre (Proprietary) and Nanavac Investments who are cited as defendants, argued that the declaration does not disclose a cause of action.

Choppies Enterprises operates a chain of retail shops in Zimbabwe and is a duly incorporated company in terms of the laws of the country while the Choppies Distribution Centre (Proprietary) and Nanavac Investments are public companies incorporated in terms of the laws of Botswana.

From the submissions filed by the defendants, they are disputing the plaintiffs’ (Mphokos’) claim that the true value of their 51 percent shareholding in Nanavac Investments was US$22 585 714.

“The deed of settlement to the extent to which it purports to set out the value of the 51 percent shareholding of the plaintiffs in Nanavac Investments is null and void,” argued the defendants’ lawyers.

Choppies Enterprises, Choppies Distribution Centre (Proprietary) and Nanavac Investments argued that the Mphokos’ claim is contradictory and inconsistent in that it seeks a declaration of invalidity without a tender of the amount they alleged to have received under duress.

“Defendants contend that the plaintiffs ought to have sought a set-off against the true value of the shares,” said the lawyers.
In their ground of exception, the defendants, further argued that the summons and declaration do not disclose a cause of action for the payment of US$22 585 714.

The Mphokos, through their lawyers Ncube and Partners, argued that the sum of US$2,9 million, which was paid by the defendants is not the true value of their 51 percent shareholding.

The plaintiffs’ argued that they are entitled to an order declaring that they are supposed to get payment of the true value of the 51 percent shareholding, which they held before they were divested of their shareholding in Nanavac Investments.

Faced with the claim, the defendant gave written notice to the Mphokos on August 18, 2020 complaining that the summons and declaration was vague and embarrassing.

They called upon the Mphokos to remove the cause of complaint within 12 days of service of their letter.

The Mphokos contended that there is no merit in the complaint by Choppies Enterprises, Choppies Distribution Centre (Proprietary) and Nanavac Investments.

They argued that it was a ploy to delay the finalisation of the matter.

In his ruling Justice Makonese said there is no legal requirement in terms of the law that compels plaintiff to plead more than the cause of action.

“I conclude, therefore that on the first ground of exception, the plaintiffs have pleaded a complete cause of action,” he said.

The judge said the Mphokos said the exception by the defendants on the grounds that the cause of action in relation to duress is vague and embarrassing has no merit and that the matters would be resolved by evidence.

“The plaintiffs have, in my view, pleaded facts upon which if they are able to prove with evidence, they may establish duress or undue influence,” said Justice Makonese.

He said for the exception to succeed the plaintiffs’ claim must go beyond salvage.

“I am satisfied that the excipients have failed to discharge the onus to show that the pleadings are vague and embarrassing and that they would be prejudiced in any way. In the result, and accordingly, the application be and hereby dismissed with costs,” ruled Justice Makonese.

The Mphokos were the majority shareholders in Choppies Enterprises holding an aggregate of 51 percent shareholding in the company. The former Vice-President held 25,5 percent, his son had 25,5 percent and Choppies Enterprises held 49 percent shareholding through Nanavac Investments.

The dispute arose in 2018 between the Mphokos and Choppies Enterprises, and it spilled to the courts. According to court papers, it was stated that in January 2019 the Mphokos and defendants agreed that plaintiffs would divest themselves of their shareholding in Nanavac Investments.

The parties entered into an agreement, which resulted in a deed of settlement being recorded. The deed of settlement is now the subject of the court proceedings. – @mashnets.