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ZESA Holdings sued US$36,000 for breaching contract

by Staff reporter
23 Jan 2024 at 05:04hrs | Views
ZESA Holdings is facing legal action from a security company, Manifest Security (Private) Limited, which is seeking US$36,660 in damages for an alleged breach of a services contract. The plaintiff's case, however, was dismissed by High Court judge Justice Siyabona Musithu.

According to court documents, on November 3, 2021, Manifest Security filed a lawsuit against ZESA, claiming damages of US$36,660 due to the breach of a contract signed by both parties. The contract, initiated on December 28, 2020, required Manifest Security to provide security guard services at eleven assigned sites, as per ZESA's tender reference number ZH/RFP/13/2020.

Manifest Security contends that ZESA violated the agreement by assigning only five sites for services instead of the agreed-upon eleven. The monthly charge for all sites was ZWL $439,696.21, equivalent to US$5,405.00. The plaintiff argues that the remaining six unutilized sites would have earned them US$36,660 for a twelve-month period.

ZESA opposed the claim, arguing that the relief sought by Manifest Security was incompetent because the claim was in US dollars instead of the local currency, as the contract was denominated in local currency. ZESA also contended that the court lacked jurisdiction since, according to the contract, any disputes should be referred to arbitration before resorting to legal action.

The judge ruled in favor of ZESA, stating that the claim in US dollars was not in line with the domestic nature of the transaction. The judge highlighted the Exchange Control (Exclusive Use of Zimbabwe Dollar for Domestic Transactions) Regulations, 2019, stating that the plaintiff's claim falls within the scope of domestic transactions as defined by the instrument. The court found merit in ZESA's preliminary objections and ordered the striking off of the plaintiff's claim, deeming it improperly before the court. The judge concluded that there was no need to delve into the merits of the case.

Source - newzimbabwe
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