RioZim Loses Over 200 Mine Claims to Zim Army
Listed diamond producer RioZim has lost more than 200 mine claims to the Zimbabwe National Army (ZNA) following the High Court’s dismissal of RioZim’s application regarding the ownership of the claims.
By Ryan Chigoche
RioZim had listed the Defence and Mines Ministers as respondents in its application, which the court found defective. The company initially sought a review of the Defence Minister’s decision to designate the land as a cantonment area or military zone under section 89 of the Defence Act.
In its application, RioZim stated it held 206 mining claims in the Darwendale area of Mashonaland West, including the Wendale 42 and Wendale 43 Block claims, registered under certificate numbers 18006BM and 18007BM, respectively. These mines are located on portions of Darwendale South Eclipse Farm, New Burnside Farm, and Darwendale B Farm. Before filing the court application, RioZim had contacted the Defence Ministry to lay claim to the land, but their request was dismissed on the basis that the land belonged to the Ministry.
In a judgment released this week, High Court judge Justice Webster Chinamhora agreed with the Defence Minister’s argument that the application was defective.
“I will deal with the preliminary points and start by addressing whether or not the deponent had the authority to act on behalf of the applicant. The starting point is section 130(2) of the Insolvency Act [Chapter 6:07], which is a deeming provision that provides as follows: ‘(2) During a company’s corporate rescue proceedings, the board of the company will be deemed to be dissolved…’
“It is evident that the first respondent’s (Minister of Defence) contention that the deponent to RioZim’s founding affidavit lacks authority to depose the applicant’s affidavit is properly founded at law.
“As highlighted above, this proposition is anchored on the fact that when a company is placed under corporate rescue, it ceases having a life of its own,” Chinamhora ruled.
“Having come to the conclusion that the deponent to the applicant’s affidavit had no authority or approval by the corporate rescue practitioner, I make the finding that the application is fatally defective.
“As I have resolved the matter on the basis of the aforesaid preliminary point, there is no application before the court,” Chinamhora said before he struck the matter off the roll with costs.
In August 2018, the Defence Minister, acting under section 89 of the Defence Act, issued a notice cited as Defence (Cantonments) Notice 2018 (No. 51). However, before the notice in February 2018, Falcon Resources (Pvt) Ltd had requested that RioZim grant it a tribute for its chrome ore claims in Darwendale.
The letter specified that the claims needed to be at least 10 kilometres away from what the company referred to as the Darwendale Military Zone. However, RioZim did not respond, as it had no intention of ceding any claims to Falcon Resources (Pvt) Ltd or any other entity.
According to RioZim, it was on May 30, 2018, that the company discovered that Rusununguko Nkululeko, which is linked to the army, and Falcon Resources were mining on its claims, specifically the Wendale 43 Block in Darwendale.
RioZim then engaged with these organizations several times to address the issue, but with no success, as the two companies argued that RioZim was operating in a military cantonment, and they continued mining on the said claims.
RioZim argued that the claim of the area being a military cantonment was false, as the area had not been officially declared as such.
This prompted RioZim to file an urgent chamber application under HC 5212/18, which the High Court initially granted with interim relief. However, Falcon Resources (Pvt) Ltd and Rusununguko Nkululeko (Pvt) Ltd appealed the High Court’s decision under SC 476/18, and the appeal was dismissed.
In the application, RioZim argued that the Defence Minister’s declaration of the area covering its mining claims as a cantonment area under Statutory Instrument 145 of 2018 was reviewable. They contended that the decision was made in a manner that violated the duty to act lawfully, reasonably, and fairly, and was irregular and ultra vires, as the Defence Minister exercised power for purposes other than those for which it was granted.
The Minister argued that RioZim had no mining claims in the area covered by Statutory Instrument 145 of 2018, Defence (Cantonments) Notice 2018 (No. 51). The Minister claimed that the Statutory Instrument declared a 10 km radius shown on the plan as a restricted area. The argument was that RioZim had no valid title to any mining claims within this area, as both Wendale 42 and 43 had been re-pegged and assigned new registration numbers different from those provided by RioZim.