South African based supplier Blakey Investments Private Limited won a R247 million lawsuit against Schweppes Zimbabwe a leading beverage manufacturer.
On the 27th of October 2021, a High Court verdict was made by Justice Tawanda Chitapi hit Schweppes Zimbabwe with costs after the beverage manufacturer made allegations against Blakey Pvt based on assumptions.
Schweppes had issued out bids against Blakey requesting for the cancelation of a supply agreement made back in May 2018 between the parties.
It is the court’s case that the two companies had signed a purchase and supply agreement on the 8th of May 2018 which reviewed that Schweppes would purchase packaging material at an agreed price.
Both the companies reformed the contract’s expiry date to June 30th 2023 from December 3 2019, added a new product and increased the volumes and prices.
The contract itself had also been changed between June 26, 2018 and March 19 2019, but was later reviewed by Schweppes that certain key aspects of the initial agreement had not been altered.
According to the company, as a resident in Zimbabwe it was bound by Statutory Instrument 109/1996 on exchange control regulations, and so claimed that both parties violated exchange control regulations because they entered into the supply chain agreement without attaining approval.
This caused the company to experience financial obligations outside Zimbabwe without exchange control authority and this according to Schweppes, rendered the agreement of no force or effect.
However Blakey disputed the allegations and according to it Schweppes failed to state its place of residence and that local laws did not render an agreement settled without exchange control approval invalid or illegal.
Blakey Pvt won the lawsuit case as Justice Tawanda Chitapi supported the company’s arguments.