Supreme Court bursts Delta, Schweppes’ ‘bubble’

THE Supreme Court (SC) has slammed the door on Delta Beverages (Delta)’s bid to reverse a 250-million-rand damages award – arising from a botched Schweppes Zimbabwe packaging materials supply deal – to South African firm Blakey Investments (Blakey) on the basis that it was unmerited.

And the ruling comes barely 10 months after the drinks maker, and its associate had lost quite a number of court battles related to the four year-old contract, which was entered into by the latter.

“This court is satisfied that the evidence adduced… was clear and established the existence of a valid contract between the appellant, and the respondent. It would be contrary to public policy to allow appellant to escape its international obligations on the pretext of its own alleged default when previously it had met its obligations,” SC judges Chinembiri Bhunu, Lavender Makoni and Alphas Chitakunye said on Monday, adding the listed group must pay the costs”.

“As the contract provided for amendments, if the appellant realised it had not bargained well, its recourse was to seek amendments in terms of the contract,” they said.

While Delta and its subsidiary had studiously tried to argue that the contract was invalid on the basis that it had been concluded by supply chain director Cynthia Malaba, the SC found or ruled that it did not violate the country’s exchange control and competition rules.
And some of the arguments that the company had tried to raise include claims that the agreement gave Blakey the “sole prerogative to determine the quantity of goods ordered, effect price and mandate to dissolve the 2018 contract”.

However, the Durban-based company maintained that the pact – preceded by a relationship dating back to 2007 – was valid and Malaba had legal authority to ink the deal, as a July 2019 audit report, some bilateral communications and previous agreements showed that some senior executives knew of the agreement.

Crucially, it was the court’s finding that it was Delta and its associates’ responsibility to ensure that they did not enter into agreements with implications for foreign payments, and that their actions were aligned to the Zimbabwean law. 

“With such an impartial judiciary, Zimbabwe is surely a safe investment destination… and such that its national development strategy-driven quest to develop into a middle-class economy by 2030 is achievable..,” Blakey chief executive Suman Panday said in a brief statement and response on Monday.

And the self-styled billionaire said the ruling “demonstrated the functionality of jurisprudence in Zimbabwean courts, sanctity of contracts and protection of investors in Harare in general”.