PROVINCIAL SUPERIOR, JESUIT PROVINCE OF ZIMBABWE v KAMOTO & ORS 2007 (2) ZLR 8 (S)

Flynote

Arbitration — award — setting aside of — grounds for — award contrary to public policy — meaning — award promoting an illegality — such award contrary to public policy

Headnote

A farm outside Harare was acquired by the appellant religious order in 1902. In time the appellant allowed some of the respondents to reside at the farm whilst a number of respondents settled themselves on the farm without authority. In 1975, the farm was incorporated into the Greater Harare Area by the Harare City Council. As all activities in the area now had to comply with the Council by-laws, the City's Director of Works advised the Area Board in 1998 that the settlement on the farm was not in accordance with the law and required regularizing. It was then that the appellant established a board to liaise with the Council. Eventually approval was granted in October 2002 for the subdivision of the farm into residential stands, with land also being reserved for schools, cr—ches, churches, commercial use and other such purposes. It had been the appellant's intention to accommodate the respondents in its development plans but because of developments that followed the appellant was prevented from doing so by the Council. The Council would only approve a low density housing scheme, which meant that the appellant was required to build roads and storm water drains in the area and to provide a water reticulation system. To do this, the respondents would have to be moved and some of their houses demolished.

The appellant brought an action for the eviction of the respondents; the matter was referred for arbitration. The arbitrator concluded that any agreement that may have been reached between the appellant and the respondents in terms of which the latter were to occupy stands on the

A farm was null and void in the light of the provisions of s 39(1) of the Regional Town and Country Planning Act [Chapter 29:12]. This provides that such any such agreement must be in accordance with a permit issued by the Council. The arbitrator also found that there was no basis in law upon which the appellant could be said to be liable to pay compensation since the buildings constructed by the respondents had to be demolished and the appellant had not been enriched in any way. The respondents filed an application in the High Court challenging the award on the basis that it was contrary to the public policy of Zimbabwe. In particular, they argued that the effect of the award was that the respondents should resettle themselves, that the award did not deal with the issue of alternative resettlement and that the award promoted the setting up of squatter camps. This, they argued, would be against the public policy of Zimbabwe. The High Court held that the arbitrator made a gross mistake in finding that the appellant had no obligation to compensate the respondents.

Held, that in ascertaining the meaning of the elusive concept of "public policy" in the context of the Model Law, regard must be had to the structure of articles 34(5) and 36(3), which deal with two aspects: the first relates to the circumstances connected with the making of the award, whilst the second relates to the substantive effect of the award itself. In casu, the latter was pertinent. An award will not be contrary to public policy merely because the reasoning or conclusions of the arbitrator are wrong in fact or in law. In such a situation a court would not be justified in setting aside the award. 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 same consequences apply where the arbitrator has not applied his mind to the question or has totally misunderstood the issue and the resultant injustice reaches the point mentioned above.

Held, further, that the effect of s 39(1) of the Act is to render null and void any agreement conferring upon any of the respondents the right to occupy the farm for a period of more than ten years. None of the residents had stayed at the farm for more than thirty years, so none had acquired any rights through prescription. The continued stay of the respondents was unlawful. The appellant had been forced to seek the eviction of the respondents. To have allowed them to remain on the farm would have been, in the circumstances, tantamount to promoting an illegality. The public policy of Zimbabwe cannot demand of a party in the appellant's position that he perpetuates the kind of settlement found at the farm. Although the appellant felt obliged to do so from a moral rather than legal standpoint, it did attempt to provide compensation and relocation allowance to enable those families it had authorized to occupy the farm to move. The attempt was a failure. The farm having been incorporated into the Council area, the responsibility of resettling the respondents would have rested firmly at the door of Government through the relevant Ministry.