Daniel Nemukuyu Senior Court Reporter
BUSINESSMAN Temba Mliswa yesterday got a reprieve from the Supreme Court protecting his property from being auctioned over $3 million he allegedly owes CBZ Bank Limited, pending determination of his application for rescission of default judgment issued at the High Court last year.
Mliswa had his property attached after the High Court issued a default order in favour of the bank in a matter in which he was being sued over the bank loan.
He filed an application for stay of execution but High Court judge Justice Priscilla Chigumba threw it away for lack of urgency.
In a bid to save his property from going under the hammer, Mr Mliswa’s lawyers Advocate Thabani Mpofu and Mr Tapson Dzvetero of Antonio and Dzvetero, approached the Supreme Court with a notice of appeal.
Deputy Chief Justice Luke Malaba, sitting with Justices Tendai Uchena and Antonia Guvava, yesterday nullified Justice Chigumba’s decision and referred back the matter to the High Court for determination of the businessman’s application of rescission of the default judgment.
The bank sued Mliswa over a $2 million debt emanating from loans advanced to the politician’s tobacco company to buy the crop in the 2010 and 2011 seasons.
The commercial bank claims it lent Mliswa’s Saltlakes Holdings money to buy tobacco from farmers and the businessman bound himself as surety and co-principal debtor.
Saltlakes, the bank claims, did not pay back the loans as per agreement, resulting in the bank filing the lawsuit in which Mliswa and Saltlakes were cited as defendants.
In the summons filed in October 2014, CBZ argued that it released $2 million to Saltlakes to finance the company’s business of buying tobacco from farmers.
In terms of the agreement signed by the parties on February 17 2011, $1 million was released to Saltlakes, being a carry-over of facilities from the 2010 tobacco buying season.
Another $1 million was released to Saltlakes as working capital to finance the purchase of tobacco in the 2011 season.
According to the agreement, Saltlakes was obliged to pay back the first loan of $1 million by December 31, 2011 and the second one expired on December 31, 2012.
It was the parties’ agreement that Saltlakes would pay collection costs, bank charges and legal costs on an attorney and client scale in the event that the bank sued for non-payment of the debt.
The parties also agreed that interest would be charged on the figure.
Saltlakes is said to have breached the agreement and, despite numerous demands, the company failed to repay the loan.
“The first and second defendants (Saltlakes and Mliswa) breached the terms of the overdraft loan facility agreement by failing to repay the principal amount and interest fully and punctually when they fell due in terms of Clause 9 of agreement,” read the plaintiff’s declaration.
By October 6 2014, interest had accrued and the debt stood at $2 745 092,72. The debt has now ballooned to more than $3 million.
CBZ wants the money to be paid back with interest calculated at the rate of 28 percent per annum from the date of issuance of summons to the date of final payment.