Tzircalle Brothers private limited v City Bulawayo &10 others [2025] ZWBHC 15 (16 July 2025)

3 HB 118/25 R-HC 1407/22 TZIRCALLE BROTHERS (PRIVATE) LIMITED APPLICANT and CITY OF BULAWAYO FIRST RESPONDENT and MR M. NCUBE N.O. SECOND RESPONDENT IN THE HIGH COURT OF ZIMBABWE NDUNA J BULAWAYO 16 JULY 2025 MR N Ncube with R Mandere for applicant Mr P Ncube for the first Respondent NDUNA J This case arises from a construction dispute between Tzircalle Brothers (Private) Limited and the City of Bulawayo concerning a public infrastructure contract. The Applicant seeks to set aside an arbitral award made in favour of the First Respondent by Mr. M. Ncube N.O. on the grounds that it is contrary to the public policy of Zimbabwe, as provided under Article 34(2)(b)(ii) of the Model Law incorporated into the Arbitration Act [Chapter 7:15] FACTUAL BACKGROUND The dispute relates to a contract awarded to the Applicant on 4 November 2016 to service residential stands in Emganwini and Tshabalala with road, water, and sewerage infrastructure. The contract was signed on 29 January 2017, with a value of US$858,421.00 and an intended duration of 180 days from 17 February 2017. An advance payment of US$171,689.28 was made, secured by a bank guarantee. The Applicant received three formal extensions, the last extending completion to 26 June 2018. By that date, several key works, including road surfacing and storm water drainage, remained outstanding. Following the expiry of the contract, the parties continued to engage, including site meetings and correspondence regarding outstanding works and the rainy season risks. On 24 August 2018, the Applicant removed its personnel and equipment from the site. On 28 December 2018, the First Respondent recalled the remaining US$61,739.34 from the guarantee, citing non-completion, abandonment, and contract expiry. The Applicant viewed this as a breach and initiated arbitration in March 2019. In the arbitration, four key issues were addressed: whether the contract had expired, whether the recall of the guarantee was lawful, who was to blame for non-completion, and the financial consequences. The Arbitrator found that the contract expired on 26 June 2018 and had not been extended, as no valid extension was granted under the terms. He held the City acted within its rights in recalling the guarantee and attributed blame for the incomplete works solely to the Applicant, who had failed to secure bitumen in time and vacated the site. All the Applicant’s claims were dismissed. The City’s counterclaims were upheld, including confirmation of the contract’s expiry, recovery of remedial costs, and an award of costs on an attorney-client scale. The Applicant approached the High Court seeking to set aside the award, arguing that it performed 90% of the work and was unjustly penalised, resulting in gross unfairness and unjust enrichment. It contended that the Arbitrator ignored the parties’ post-expiry conduct, including continued engagement and the extension of the guarantee to December 2018, which allegedly indicated the contract’s continuation. The First Respondent raised a preliminary objection that the application was out of time. The arbitral award was issued on 28 April 2022, and the application was filed on 29 July 2022, one day outside the three-month limit prescribed under Article 34(3) of the Model Law. The Applicant did not clearly establish when it received the award, a requirement to support its assertion that the application was timely. On the merits, the First Respondent argued that the threshold for setting aside an arbitral award on public policy grounds is exceptionally high. Referring to ZESA v Maposa 1999 (2) ZLR 452 (S), it submitted that an award can only be set aside if it is so outrageous in its defiance of logic or morality that it would offend the conception of justice in Zimbabwe. This standard has been reaffirmed in cases such as Alliance Insurance v Imperial Plastics HH 295-19 and Pioneer Transport v Delta Corporation HH 152-15. The First Respondent maintained that the Arbitrator’s findings were reasoned and contractually justified, particularly in light of the Applicant’s own conduct, which included multiple requests for extensions and removal from site after expiry. First Respondent further averred that the Applicant’s failure to file the full arbitration record, including pleadings and evidence, made it difficult for the Court to assess whether the award truly defied logic. ISSUES FOR DETERMINATION Whether the application was filed out of time Whether the arbitral award is contrary to the public policy of Zimbabwe, thus warranting setting aside under Article 34(2)(b)(ii) of the Model Law. APPLICATION OF THE LAW TO THE FACTS Whether the Application is Time-Barred Article 34(3) of the Model Law (Schedule to the Arbitration Act [Chapter 7:15]) provides that an application for setting aside an arbitral award must be made within three months of the party receiving the award where it states “3) An application for setting aside may not be made after three months have elapsed from the date on which the party making that application had received the award or, if a request had been made under article 33, from the date on which that request had been disposed of by the arbitral tribunal”. The award in this matter is dated 28 April 2022. The Applicant filed its application on 29 July 2022 and served it on 1 August 2022.The Applicant disputes that the award was delivered to it on 28 April 2022. In Peruke Investments (Pvt) Ltd v City of Harare SC 11/2015 it was held on pp 11 “I take this view for two compelling reasons. Firstly, a literal reading of Article 34(3), as requiring actual as opposed to putative receipt of the arbitral award, is amply supported by Article 3(1) which enjoins physical delivery of written communications in arbitral proceedings, either in person to the intended recipient or to his place of business or habitual residence or by registered mail. This interpretation is further fortified by Article 31(4) which explicitly mandates the delivery of a signed copy of the award to each party. The burden to do so is implicitly placed on the arbitrator himself or on the administrator of the place of arbitration. There is no obligation imposed upon either party to take steps to actively obtain a copy of the award”. This principle makes it clear that the three-month period for filing an application to set aside an arbitral award does not commence from the date the award is issued, but from the date on which it is actually delivered to the concerned party. Applied to the present facts, while the arbitral award is dated 28 April 2022, the Applicant contends that it did not receive the award on that same date. Crucially, the First Respondent has not provided direct evidence showing when delivery to the Applicant occurred. In turn, the Applicant has not disclosed or proved an alternative delivery date, nor produced an affidavit by the arbitrator confirming the date of dispatch or receipt. The absence of clarity regarding the date of actual receipt by the Applicant renders it unsafe for this Court to conclude that the three-month limitation period had already lapsed when the application was filed on 29 July 2022. I find that the preliminary point on time bar cannot be upheld in the absence of clear proof of actual delivery of the award to the Applicant before 29 April 2022. The Court, therefore, proceeds to determine the application on its merits. Whether the Arbitral Award is Contrary to Public Policy The Applicant invokes Article 34(2)(b)(ii) of the Model Law, alleging that the arbitral award offends the public policy of Zimbabwe and ought to be set aside. Section 34(2) of the Arbitration Act [Chapter 7:15] provides that: “(2) An arbitral award may be set aside by the High Court only if— (a) the party making the application furnishes proof that ……….; or (b) the High Court finds that— (i) the subject-matter of the dispute is not capable of settlement by arbitration under the law of Zimbabwe; or (ii) the award is in conflict with the public policy of Zimbabwe”. The basis for this contention is that the award unjustly found the Applicant liable for the costs of remedial works and denied its claims, despite its assertion that it completed 90% of the contractual works. The Applicant argues that this outcome constitutes a gross injustice, particularly where public funds and developmental obligations are at stake. The public policy ground for setting aside arbitral awards is an exceptional remedy, to be interpreted and applied restrictively. In Zimbabwe Electricity Supply Authority v Maposa 1999 (2) ZLR 452 (SC) p 466 E-G - “Under article 34 or 36, the court does not exercise an appeal power and either uphold or set aside or decline to recognise and enforce an award by having regard to what it considers should have been the correct decision. Where, however, the reasoning or conclusion in an award goes beyond mere faultiness or incorrectness and constitutes a palpable inequity that is so far reaching and outrageous in its defiance of logic or accepted moral standards that a sensible and fair minded person would consider that the conception of justice in Zimbabwe would be intolerably hurt by the award, then it would be contrary to public policy to uphold it”. The Court in GMB v Arenel (Pvt) Ltd HB 156/20, at page 10, elaborated this principle by stating: “The concept of public policy in any given society is an elusive one, however it is generally accepted that an act will be regarded as being contrary to the public policy of Zimbabwe if it violates notions of elementary justice or constitutes a palpable inequity that would hurt the conception of justice in Zimbabwe. A restrictive approach must be adopted to construe the public policy defence in order to preserve and recognise the basic objective of finality in all arbitrations. The court does not exercise an appeal power, and it cannot set aside an award because it considers the decision to be wrong. The public policy defence can only be upheld where some fundamental principle of the law or morality or justice is violated. Where the reasoning or conclusion in an award goes beyond mere faultiness or incorrectness and constitutes a palpable inequity that is so far reaching and outrageous in its defiance of logic or accepted moral standards that a sensible and fair minded person would consider that the conception of justice in Zimbabwe would be intolerably hurt by the award, then it would be contrary to public policy to uphold it. Where the arbitrator has not applied his mind to the question or has totally misunderstood the issue, and the resultant injustice creates a palpable inequity. Even where an arbitrator makes a finding that is erroneous or unreasonable, the court should not interfere but it could only interfere if the decision was attended by a gross irregularity or it resulted in a failure of justice”. Applying these principles to the facts, the award in this case cannot be said to rise to the high threshold required for public policy intervention. The arbitrator’s conclusions were based on clear contractual provisions: Clause 1 of the General Conditions designated the Project Manager as the sole authority to grant time extensions; Clause 22 required variations to be in writing and signed; and Clause 51 governed the advance payment and allowed recovery through a guarantee. These clauses were central to the arbitrator’s findings that the contract expired on 26 June 2018, that there was no valid extension thereafter, and that the City was entitled to recover the unrepaid portion of the advance payment following non-performance. Moreover, the arbitrator’s determination that the Applicant was solely to blame for failing to complete the work was supported by evidence that the Applicant delayed applying for foreign currency until June 2018, ignored earlier warnings from the First Respondent, and eventually vacated the site in August 2018. The arbitrator also found that the continued discussions and maintenance of the guarantee post-June 2018 did not amount to a renewal of the contract. These are not findings that can be described as outrageous, irrational, or morally offensive. They may be disputed, as the Applicant has done, but the law is clear that mere faultiness or incorrectness in the arbitrator’s reasoning does not warrant judicial interference. As emphasized in Chartpril Enterprises (Pvt) Ltd and 2 Others v Elnour United Engineering Group (Pvt) Ltd HH 602-21 on page 11 para 41 “The High Court has no general powers of supervision over arbitral awards. The approach to take in a matter such as this is not to approach the issues as if the court is sitting as an appeal court, rather, the court must test the arbitrator’s approach and conduct of the arbitration”. The High Court does not supervise arbitration as if sitting on appeal it can only test the approach and will only intervene if the conduct of the arbitrator was grossly unreasonable In the final analysis, while the Applicant may feel aggrieved by the award and its financial implications, this is not a case where the award violates a fundamental tenet of justice, morality, or Zimbabwean law. The arbitrator did not act outside his mandate, nor did he make a decision that shocks the conscience of a fair-minded observer. The public policy defence is therefore not available to the Applicant. DISPOSITION The application to set aside the arbitral award is without merit. The Applicant has failed to demonstrate that the award is contrary to the public policy of Zimbabwe. The award was rendered within the confines of the contractual framework and based on logical and reasoned findings. There is no basis to disturb it. Order The application to set aside the arbitral award dated 28 April 2022 is dismissed.The Applicant shall bear the costs of this application on the legal practitioner and client scale. Dube Legal Practice applicant’s legal practitioners Coghlan and Welsh Legal Practitioners respondents’ legal practitioners 3 HB 118/25 R-HC 1407/22 3 HB 118/25 R-HC 1407/22 TZIRCALLE BROTHERS (PRIVATE) LIMITED APPLICANT and CITY OF BULAWAYO FIRST RESPONDENT and MR M. NCUBE N.O. SECOND RESPONDENT IN THE HIGH COURT OF ZIMBABWE NDUNA J BULAWAYO 16 JULY 2025 MR N Ncube with R Mandere for applicant Mr P Ncube for the first Respondent NDUNA J This case arises from a construction dispute between Tzircalle Brothers (Private) Limited and the City of Bulawayo concerning a public infrastructure contract. The Applicant seeks to set aside an arbitral award made in favour of the First Respondent by Mr. M. Ncube N.O. on the grounds that it is contrary to the public policy of Zimbabwe, as provided under Article 34(2)(b)(ii) of the Model Law incorporated into the Arbitration Act [Chapter 7:15] FACTUAL BACKGROUND The dispute relates to a contract awarded to the Applicant on 4 November 2016 to service residential stands in Emganwini and Tshabalala with road, water, and sewerage infrastructure. The contract was signed on 29 January 2017, with a value of US$858,421.00 and an intended duration of 180 days from 17 February 2017. An advance payment of US$171,689.28 was made, secured by a bank guarantee. The Applicant received three formal extensions, the last extending completion to 26 June 2018. By that date, several key works, including road surfacing and storm water drainage, remained outstanding. Following the expiry of the contract, the parties continued to engage, including site meetings and correspondence regarding outstanding works and the rainy season risks. On 24 August 2018, the Applicant removed its personnel and equipment from the site. On 28 December 2018, the First Respondent recalled the remaining US$61,739.34 from the guarantee, citing non-completion, abandonment, and contract expiry. The Applicant viewed this as a breach and initiated arbitration in March 2019. In the arbitration, four key issues were addressed: whether the contract had expired, whether the recall of the guarantee was lawful, who was to blame for non-completion, and the financial consequences. The Arbitrator found that the contract expired on 26 June 2018 and had not been extended, as no valid extension was granted under the terms. He held the City acted within its rights in recalling the guarantee and attributed blame for the incomplete works solely to the Applicant, who had failed to secure bitumen in time and vacated the site. All the Applicant’s claims were dismissed. The City’s counterclaims were upheld, including confirmation of the contract’s expiry, recovery of remedial costs, and an award of costs on an attorney-client scale. The Applicant approached the High Court seeking to set aside the award, arguing that it performed 90% of the work and was unjustly penalised, resulting in gross unfairness and unjust enrichment. It contended that the Arbitrator ignored the parties’ post-expiry conduct, including continued engagement and the extension of the guarantee to December 2018, which allegedly indicated the contract’s continuation. The First Respondent raised a preliminary objection that the application was out of time. The arbitral award was issued on 28 April 2022, and the application was filed on 29 July 2022, one day outside the three-month limit prescribed under Article 34(3) of the Model Law. The Applicant did not clearly establish when it received the award, a requirement to support its assertion that the application was timely. On the merits, the First Respondent argued that the threshold for setting aside an arbitral award on public policy grounds is exceptionally high. Referring to ZESA v Maposa 1999 (2) ZLR 452 (S), it submitted that an award can only be set aside if it is so outrageous in its defiance of logic or morality that it would offend the conception of justice in Zimbabwe. This standard has been reaffirmed in cases such as Alliance Insurance v Imperial Plastics HH 295-19 and Pioneer Transport v Delta Corporation HH 152-15. The First Respondent maintained that the Arbitrator’s findings were reasoned and contractually justified, particularly in light of the Applicant’s own conduct, which included multiple requests for extensions and removal from site after expiry. First Respondent further averred that the Applicant’s failure to file the full arbitration record, including pleadings and evidence, made it difficult for the Court to assess whether the award truly defied logic. ISSUES FOR DETERMINATION Whether the application was filed out of time Whether the arbitral award is contrary to the public policy of Zimbabwe, thus warranting setting aside under Article 34(2)(b)(ii) of the Model Law. APPLICATION OF THE LAW TO THE FACTS Whether the Application is Time-Barred Article 34(3) of the Model Law (Schedule to the Arbitration Act [Chapter 7:15]) provides that an application for setting aside an arbitral award must be made within three months of the party receiving the award where it states “3) An application for setting aside may not be made after three months have elapsed from the date on which the party making that application had received the award or, if a request had been made under article 33, from the date on which that request had been disposed of by the arbitral tribunal”. The award in this matter is dated 28 April 2022. The Applicant filed its application on 29 July 2022 and served it on 1 August 2022.The Applicant disputes that the award was delivered to it on 28 April 2022. In Peruke Investments (Pvt) Ltd v City of Harare SC 11/2015 it was held on pp 11 “I take this view for two compelling reasons. Firstly, a literal reading of Article 34(3), as requiring actual as opposed to putative receipt of the arbitral award, is amply supported by Article 3(1) which enjoins physical delivery of written communications in arbitral proceedings, either in person to the intended recipient or to his place of business or habitual residence or by registered mail. This interpretation is further fortified by Article 31(4) which explicitly mandates the delivery of a signed copy of the award to each party. The burden to do so is implicitly placed on the arbitrator himself or on the administrator of the place of arbitration. There is no obligation imposed upon either party to take steps to actively obtain a copy of the award”. This principle makes it clear that the three-month period for filing an application to set aside an arbitral award does not commence from the date the award is issued, but from the date on which it is actually delivered to the concerned party. Applied to the present facts, while the arbitral award is dated 28 April 2022, the Applicant contends that it did not receive the award on that same date. Crucially, the First Respondent has not provided direct evidence showing when delivery to the Applicant occurred. In turn, the Applicant has not disclosed or proved an alternative delivery date, nor produced an affidavit by the arbitrator confirming the date of dispatch or receipt. The absence of clarity regarding the date of actual receipt by the Applicant renders it unsafe for this Court to conclude that the three-month limitation period had already lapsed when the application was filed on 29 July 2022. I find that the preliminary point on time bar cannot be upheld in the absence of clear proof of actual delivery of the award to the Applicant before 29 April 2022. The Court, therefore, proceeds to determine the application on its merits. Whether the Arbitral Award is Contrary to Public Policy The Applicant invokes Article 34(2)(b)(ii) of the Model Law, alleging that the arbitral award offends the public policy of Zimbabwe and ought to be set aside. Section 34(2) of the Arbitration Act [Chapter 7:15] provides that: “(2) An arbitral award may be set aside by the High Court only if— (a) the party making the application furnishes proof that ……….; or (b) the High Court finds that— (i) the subject-matter of the dispute is not capable of settlement by arbitration under the law of Zimbabwe; or (ii) the award is in conflict with the public policy of Zimbabwe”. The basis for this contention is that the award unjustly found the Applicant liable for the costs of remedial works and denied its claims, despite its assertion that it completed 90% of the contractual works. The Applicant argues that this outcome constitutes a gross injustice, particularly where public funds and developmental obligations are at stake. The public policy ground for setting aside arbitral awards is an exceptional remedy, to be interpreted and applied restrictively. In Zimbabwe Electricity Supply Authority v Maposa 1999 (2) ZLR 452 (SC) p 466 E-G - “Under article 34 or 36, the court does not exercise an appeal power and either uphold or set aside or decline to recognise and enforce an award by having regard to what it considers should have been the correct decision. Where, however, the reasoning or conclusion in an award goes beyond mere faultiness or incorrectness and constitutes a palpable inequity that is so far reaching and outrageous in its defiance of logic or accepted moral standards that a sensible and fair minded person would consider that the conception of justice in Zimbabwe would be intolerably hurt by the award, then it would be contrary to public policy to uphold it”. The Court in GMB v Arenel (Pvt) Ltd HB 156/20, at page 10, elaborated this principle by stating: “The concept of public policy in any given society is an elusive one, however it is generally accepted that an act will be regarded as being contrary to the public policy of Zimbabwe if it violates notions of elementary justice or constitutes a palpable inequity that would hurt the conception of justice in Zimbabwe. A restrictive approach must be adopted to construe the public policy defence in order to preserve and recognise the basic objective of finality in all arbitrations. The court does not exercise an appeal power, and it cannot set aside an award because it considers the decision to be wrong. The public policy defence can only be upheld where some fundamental principle of the law or morality or justice is violated. Where the reasoning or conclusion in an award goes beyond mere faultiness or incorrectness and constitutes a palpable inequity that is so far reaching and outrageous in its defiance of logic or accepted moral standards that a sensible and fair minded person would consider that the conception of justice in Zimbabwe would be intolerably hurt by the award, then it would be contrary to public policy to uphold it. Where the arbitrator has not applied his mind to the question or has totally misunderstood the issue, and the resultant injustice creates a palpable inequity. Even where an arbitrator makes a finding that is erroneous or unreasonable, the court should not interfere but it could only interfere if the decision was attended by a gross irregularity or it resulted in a failure of justice”. Applying these principles to the facts, the award in this case cannot be said to rise to the high threshold required for public policy intervention. The arbitrator’s conclusions were based on clear contractual provisions: Clause 1 of the General Conditions designated the Project Manager as the sole authority to grant time extensions; Clause 22 required variations to be in writing and signed; and Clause 51 governed the advance payment and allowed recovery through a guarantee. These clauses were central to the arbitrator’s findings that the contract expired on 26 June 2018, that there was no valid extension thereafter, and that the City was entitled to recover the unrepaid portion of the advance payment following non-performance. Moreover, the arbitrator’s determination that the Applicant was solely to blame for failing to complete the work was supported by evidence that the Applicant delayed applying for foreign currency until June 2018, ignored earlier warnings from the First Respondent, and eventually vacated the site in August 2018. The arbitrator also found that the continued discussions and maintenance of the guarantee post-June 2018 did not amount to a renewal of the contract. These are not findings that can be described as outrageous, irrational, or morally offensive. They may be disputed, as the Applicant has done, but the law is clear that mere faultiness or incorrectness in the arbitrator’s reasoning does not warrant judicial interference. As emphasized in Chartpril Enterprises (Pvt) Ltd and 2 Others v Elnour United Engineering Group (Pvt) Ltd HH 602-21 on page 11 para 41 “The High Court has no general powers of supervision over arbitral awards. The approach to take in a matter such as this is not to approach the issues as if the court is sitting as an appeal court, rather, the court must test the arbitrator’s approach and conduct of the arbitration”. The High Court does not supervise arbitration as if sitting on appeal it can only test the approach and will only intervene if the conduct of the arbitrator was grossly unreasonable In the final analysis, while the Applicant may feel aggrieved by the award and its financial implications, this is not a case where the award violates a fundamental tenet of justice, morality, or Zimbabwean law. The arbitrator did not act outside his mandate, nor did he make a decision that shocks the conscience of a fair-minded observer. The public policy defence is therefore not available to the Applicant. DISPOSITION The application to set aside the arbitral award is without merit. The Applicant has failed to demonstrate that the award is contrary to the public policy of Zimbabwe. The award was rendered within the confines of the contractual framework and based on logical and reasoned findings. There is no basis to disturb it. Order The application to set aside the arbitral award dated 28 April 2022 is dismissed. The Applicant shall bear the costs of this application on the legal practitioner and client scale. Dube Legal Practice applicant’s legal practitioners Coghlan and Welsh Legal Practitioners respondents’ legal practitioners