Stanbic to appeal ‘bad debtor’ judgment
Published On December 8, 2016 » 2167 Views» By Diran Chama » Court News, Latest News
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StanbicBy Delphine Zulu -

THE Court of appeal has granted Stanbic Bank Zambia leave to appeal against the judgment that ordered the payment of K192.5 million to Savenda Management Services in damages after registering it as a bad debtor with the Credit Reference Bureau.
The majority ruling was delivered by the Court of Appeal president Fulgency Chisanga, Justice Catherine Makungu and Justice Mubanga Kondolo.
In a ruling that lasted more than two hours, the Court of Appeal stated that Stanbic Bank had demonstrated sufficient reason for the court to exercise its discretion to allow the application.
This is a matter Savenda sued Stanbic Zambia claiming damages for loss of business of K192.5 million as a result of being recorded in the Credit Reference Bureau.
Madam Justice Chisanga said from the record, there was no mala fides (bad faith) on the part of Stanbic Bank and that the bank should be allowed to file its notice of appeal within 14 days of the ruling.
The court further stated that the High Court judge and the single judge of the Court of Appeal respectively fell in error in the manner that they had handled the applicant’s application for leave to appeal out of time.
The case centres on two loans made by Stanbic Bank to procurement and logistics company Savenda Management Services in 2008.
After a protracted legal battle in which Savenda claimed a bank computer error had led to it being declared in default, the bank is now appealing against a court order requiring it to compensate Savenda
for being reported to the national Credit Reference Bureau (CRB) and maintained in its submissions that the original debt remains unpaid.
In May 2013 an arbitration court ruled that Savenda must pay Stanbic US$1.36 million it was owed under a lease buy-back facility for a US$540,000 printing machine.
In August 2013 the bank obtained a court order and moved to repossess pledged security, but Savenda obtained a stay of execution pending an application to repay the debt in instalments.
In November 2014 the High Court discharged the appeal and stay of execution on the grounds that the Arbitral Tribunal’s original finding was final and binding.
Judge Justin Chashi, of the court’s commercial division, awarded damages to Savenda for losing significant contracts for loss of business resulting from its negative credit agency listing.
He found the non-payments were the bank’s fault and made other findings that will affect relations between other businesses and their bankers.
In 2007, Savenda arranged a Stanbic lease buy-back facility for a $540,000 printing machine, with payment to be made via an overdraft facility.
But in his dissenting views Judge Kondolo agreed with Justice Nkonde’s ruling to discharge the stay and ordered the bank to pay the damages.
Savenda Management Services managing director Clever Mphoa insisted that the court should dismiss the application to appeal against the judgment that waived the order to stay the execution to recover money owed by the bank.
Mr Mphoa explained that initially, the bailiffs from the sheriff’s office moved in to levy distress on the bank on September 21 but that an agreement was reached to offset a part of the money owed.

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