Byo man takes Sedco to court

Source: Byo man takes Sedco to court | The Standard (Local News)

A Bulawayo resident, Mandlenkosi Ndlovu, has filed a chamber application for leave to file a Constitutional Court application, challenging the constitutionality of the Small Enterprises Development Corporation (Sedco) Act.


Sedco is a government entity operating in terms of the Small Enterprises Development Act, Chapter 16:93.

In his papers, Ndlovu cited Sedco, Khiwa Moyo, SMES ministry and the Registrar of Deeds and Companies as respondents.

In his founding affidavit, Ndlovu said on February 7, 2011, the first respondent (Sedco) extended a loan amounting to $5 000 to Laudable Trading Private Limited, a company where he is a director.

He, therefore, tendered his residential property as security for the loan, for repayment and he signed a note of hand to that effect. However, the note of hand was registered with the Registrar of Deeds in Bulawayo in terms of section 37 of Sedco Act without his knowledge.

Ndlovu said on May 9, 2011, Sedco sent him an email, demanding payment together with interest thereon, failure of which it would seize the property and dispose of it to recover the balance.

“I subsequently approached the first respondent and requested an extension of time for payment which was accepted. To that end I made several payments in the total sum of $3 500 from 18 September 2012 to 26 April 2013. That left a sum due and owing on the principal sum of $1 500 and interest thereon,” Ndlovu submitted.

The property was subsequently auctioned in July 2015 without further notice to him. It was sold to the second respondent (Khiwa Moyo) for the sum of $12 000.

“I was not informed of the sale prior to its occurrence and therefore I could not file an objection within 14 days thereafter,” he said.

Ndlovu said Sedco proceeded to pass transfer of the property to Moyo without further communication to him and he only became aware when Moyo contacted him to enquire when he would vacate the property.

“I humbly aver that section 56 (1) of the Constitution which enjoins equal benefit and protection of the law has been violated by section 38 (2) of the Sedco Act as follows: Sedco enjoys a superior status to any other person who is a creditor holding a bond over immovable property,” he submitted.

Ndlovu said Sedco might execute and transfer the immovable property with no regard to the due process stipulated in the Rules of the High Court and the High Court Act, which apply to everyone else.

“Furthermore, I do not enjoy the same protections as any other person who is debtor. I have no other legal means of challenging the sale and transfer of my immovable property to second respondent,” he said.

Ndlovu said section 68 (1) requires that administrative conduct which is lawful, reasonable, proportionate, impartial, substantively and procedurally fair.

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