Powertel, Dandemutande 7-year deadlock broken

The High Court of Zimbabwe has brought an end to a protracted legal impasse between Powertel Communications (Pvt) Ltd and Dandemutande Investments (Pvt) Ltd, ordering the appointment of a sole arbitrator to resolve their longstanding contractual dispute.

The dispute traces back to a 2010 Internet Capacity Purchase Agreement, which required arbitration to settle disagreements unless both parties consented to court jurisdiction. However, a fallout in 2017 - after Dandemutande allegedly terminated the agreement and failed to pay over US$2.29 million owed to Powertel - sparked a legal tug-of-war that stalled arbitration for nearly seven years.

Initial efforts to arbitrate were unsuccessful. In 2018, retired Justice Vernanda Ziyambi was appointed arbitrator, but the process collapsed after Dandemutande failed to file a claim, and Justice Ziyambi later withdrew due to unavailability. A second attempt in 2023 also failed after Dandemutande objected to the newly appointed arbitrator, leading to the termination of the proceedings by mutual consent.

Powertel eventually turned to the High Court, seeking intervention under the Arbitration Act. In a decisive ruling, Justice Maxwell Takuva criticised Dandemutande for deliberately obstructing arbitration proceedings and ruled that Powertel was legally justified in requesting court assistance.

"The conduct of the respondent has been obstructive and has stalled progress," said Justice Takuva in his ruling. "The request for court intervention under the Arbitration Act is merited."

The court dismissed Dandemutande's objections concerning prescription (expiry of legal claims) and the competence of the relief sought. While it acknowledged Powertel's own delays - specifically its five-year failure to revive the process after the initial setback - the court ultimately ruled in favour of resolution.

Justice Takuva directed that the Chairman of the Commercial Arbitration Centre in Harare is to appoint a sole arbitrator, enabling arbitration proceedings to formally resume.

Although the court declined to award punitive costs against Dandemutande, it ruled that the company must pay ordinary costs of the suit to Powertel.

The ruling marks a significant turning point in one of Zimbabwe's telecommunications industry's longest-running contractual disputes. Legal observers expect the appointment of an arbitrator to finally set the wheels in motion for a substantive resolution.