The Supreme Court of Zimbabwe has dismissed an application by the Zimbabwe Diamond and Allied Minerals Workers Union and two employees to revive an appeal against the dismissal of their bid to place RioZim Limited under corporate rescue. The application was struck off the roll due to procedural defects, specifically the failure to seek condonation for non-compliance with court rules. The matter was heard by Justice of Appeal Chiweshe in chambers.
The applicants had initially approached the court seeking to place RioZim under corporate rescue, arguing that the mining company was financially distressed. They claimed that corporate rescue would protect affected employees, preserve shareholder value, and improve the company's management following the death of its majority shareholder. However, RioZim opposed the application, disputing that it was financially distressed.
The court a quo had previously dismissed the corporate rescue application, upholding RioZim's objection that the applicants lacked locus standi. The court found that the union represented employees in the diamond and allied minerals sector generally but had not established that it represented employees of RioZim specifically. The applicants then lodged an appeal, but it was deemed abandoned after they failed to pay the required security for costs within the prescribed period.
The applicants subsequently approached the Supreme Court seeking reinstatement of the appeal under Rule 76(2), which allows an appeal deemed abandoned or dismissed by operation of the rules to be reinstated where good cause is shown. However, RioZim opposed the application, arguing that it was procedurally defective. The company claimed that the applicants had failed to seek condonation for their failure to comply with the rules and had provided the wrong dies induciae to the respondents.
Justice Chiweshe rejected the applicants' argument that they had sought condonation and that the relief was contained in the draft order accompanying their application. The court held that once a party has failed to comply with the rules, it must first seek condonation before seeking further relief where condonation is required. The judgement relied on previous Supreme Court decisions, including Gazi v Mbababala Properties (Pvt) Ltd and Goyel v Myrammar Farming (Pvt) Ltd & Ors.
The court found that the applicants had neither properly sought nor motivated condonation for their non-compliance with the rules. Although they referred to condonation in their draft order, they failed to seek or motivate that relief in their founding affidavit. The court therefore declined to consider the remaining preliminary objections and struck off the application with costs.
The dismissal of the application means that the workers' bid to place RioZim under corporate rescue has been unsuccessful. The company's financial situation and management will remain unchanged, at least for now. The applicants' failure to follow proper procedures has resulted in their application being struck off, highlighting the importance of adhering to court rules and procedures.
Key points
- The Supreme Court of Zimbabwe struck off an application by the Zimbabwe Diamond and Allied Minerals Workers Union and two employees seeking to revive an appeal against the dismissal of their bid to place RioZim Limited under corporate rescue due to procedural defects.
- The applicants failed to seek condonation for their non-compliance with court rules, rendering their application fatally defective.
- The dismissal of the application means that RioZim will not be placed under corporate rescue, at least for now.
