Daniel Nemukuyu Senior Court Reporter
Top banker and Renaissance Financial Holdings Limited director Mr Patterson Timba will now reclaim all his lost properties and assets, including the Renaissance Merchant Bank, after the High Court yesterday nullified the actions and all decisions made by the Professor Christopher Chetsanga-led board after January 26, 2012.
Heads will roll as the multi-million dollar deal that saw the National Social Security Authority (NSSA) taking over ownership of RMB (now Capital Bank Corporation Limited) with 86 percent shareholding, is likely to be nullified.
Justice Owen Tagu, in a judgment handed down yesterday, confirmed the expulsion of Professor Chetsanga, Mr Collin Kuhuni and Mrs Monica Mukonoweshuro from the RFHL board and declared to be null and void all actions and decisions by the board led by the trio post January 26, 2012.
It is understood that costly decisions were made during the tenure of the now expelled board and they are likely to spark a flood gate of lawsuits.
RFHL owns 100 percent shareholding in Renaissance Merchants’ Bank, which has since been sold and changed its name to Capital Bank Corporation without the approval of Mr Timba and other legitimate directors.
The High Court judgment came at a time Mr Timba had filed a $526,6 million lawsuit against RMB curator Mr Reggie Saruchera, Prof Chetsanga, Mr Kuhuni and Mrs Mukonoweshuro among others, over the loss he suffered as a result of the decisions and transactions effected post-January 26, 2012.
In yesterday’s judgment, Justice Tagu nullified all actions and upheld the expulsion of the three former RFHL board members.
“The defendants (trio) are declared validly dismissed from their directorship with second plaintiff (RFHL) pursuant to the Extraordinary General Meeting of January 25, 2012.
“The business purportedly undertaken by defendants on behalf of second plaintiff post 26 January 2012 is null and void and of no force or effect.
“Defendants (trio) are interdicted from continuing to hold themselves out as directors of second plaintiff,” ruled Justice Tagu. The judge also ordered the three to pay costs of the suit.
Advocates Thabani Mpofu and Sylvester Hashiti instructed by a team of legal practitioners including Mr Vote Muza of Muza and Nyapadi and Mr Alex Mambosasa of Mambosasa Legal Practitioners represented Mr Timba in the four-year legal battle.
Advocate Tawanda Zhuwarara instructed by Kantor and Immerman law firm represented Prof Chetsanga and Mrs Mukonoweshuro while Wintertons law firm acted for Mr Kuhuni.
The three former directors were dismissed from the board at an extraordinary general meeting held on January 25, 2012. The same group disregarded the expulsion arguing that it had not been sanctioned by Mr Saruchera, who was then RMB curator.
To that end, the three convened a separate “board meeting” a day after, on January 26 and purportedly passed a vote of no confidence in Mr Timba.
That is when the trio took over the board and made various decisions to the exclusion of Mr Timba with the assistance of Mr Saruchera, who was appointed curator to the bank and not the holding company.
Justice Tagu said the three former RFHL directors wrongly interpreted Section 54 of the Banking Act, which gives power to the curator over issues pertaining to the bank under curatorship.
However, the judge noted, the curator went out of bounds and dealt with issues relating to the holding company RFHL that was not under curatorship.
“RFHL was not under curatorship and hence could transact other business.
“The curator on the other hand had nothing to do with the transactions of first plaintiff (Mr Timba) and RFHL as long as they have nothing to do with RMB.
“RFHL could therefore appoint and or disappoint directors at will,” the court ruled. The judge agreed with Adv Mpofu that the EGM that fired the trio was above board and that Mr Saruchera as curator had no power to stop it as he purportedly did.
“I agree with Adv Mpofu that Reggie Saruchera as the curator of RMB had no power to stop the meeting that took place on January 25, 2012. The meeting was properly called and constituted.
“The resolutions made at that meeting are valid and did not require the authority or directive of the curator,” the judge ruled.
Mr Timba, among other complaints of financial prejudice, queried the transaction that gave NSSA 86 percent shareholding in the bank, now Capital Bank Corporation when RFHL had always been the sole shareholder.
Some 19 percent shares in First Mutual Holdings were sold to NSSA without the blessings or approval of RFHL directors.
The change of the bank’s name to Capital Bank Corporation was also another action by the ousted directors.