City Centre Hotel (PVT) LTD v Nyamanhindi 1999 (1) ZLR 81 (H)

Mr Biti for the appellant contract law. A company owned three pieces of land. Purportedly acting on behalf of the company, one of its directors, TGP Nyamanhindi, sold these pieces of land and undertook to give the buyer vacant possession. P Nyamanhindi was occupying these pieces of land and refused to vacate them.

TGP Nyamanhindi and P Nyamanhindi were directors in the company. Each owned 1% in the company the other 98% of the share were owned by the Nyamanhindi family trust. TGP Nyamanhindi claimed that at an extraordinary meeting of the company, at which he was the sole person in attendance, a resolution had been passed giving him the power to sell the properties of the company and to determine at his discretion the purchase price. He had attended this meeting in two different capacities, namely as a director and as the sole representative of the family trust.

Held that P Nyamanhindi had not been given notice of the the extraordinary meeting and this invalidated the proceedings at that meeting.

held, further that even if the resolution at the extraordinary meeting was validly passed, the resolution was described in the minute as a resolution of the shareholders. selling company assets may be recommended by the shareholders but disposing of the company assets is an executive act which can only be done through the directors. The resolution of the shareholders the needed to be sent to a meeting of the Board of Directors and no such meeting was held

Held further, that the purchaser could not claim that TGP Nyamanhindi had ostensible authority such that the sale should be enforced on the basis of the rule the the TURQUAND case. TGP Nyamanhindi was only a director and not a managing director and a buyer of company property cannot assume that a single director who is not a managing director has power to enter into the contract.

held, therefore that the purported sale was null and void