Company bid to reverse sale of property flop

Source: Company bid to reverse sale of property flop | Herald (Business)

Fidelis Munyoro

An attempt by a company under liquidation to nullify the sale of an upmarket residential property claiming the transaction was done without leave of the court has failed after the High Court rejected the application.

Goldlock Industries (2003) (Pvt) Limited, a company under liquidation claims ownership of the property known as Stand 666 Marlborough Township.

 

The Sheriff sold the property to a global financial concern, AL Shams Global VI Limited by way of a judicial sale.

AL Shams VI was the highest bidder.

 

But Goldlock sold the same property to a third party Mr Emmanuel Manyika despite it having already been taken. The transfer of the property to Mr Manyika could not be effected because the title deeds to the property were still held by the by AL Shams Global.

The company then approached the High Court challenging the sale of the property by the Sheriff of Zimbabwe cited as the first respondent in the matter.

Also cited in the matter were Interfin Banking Corporation (which is under liquidation), AL Shams Global BVI Limited and its director Mr Jayesh Shah, the Registrar of Deeds and the Master of High Court.

It wanted the court to order that Stand 666 Marlborough Township formed part of the assets of the applicant in liquidation and that any action against the company should not be done without the leave of court.

Goldlock also wanted the Sheriff and AL Shams Global ordered to surrender to it, the original copy of the Deed of Transfer No. 8810/2003 within 10 days from the date of service of the order it sought.

But Justice Webster Chinamora threw out the application finding that the property at the centre of the dispute was declared especially executable by an order of the High Court and that the sale was done before Goldlock was placed under voluntary liquidation.

At the time of liquidation, Mr Shah had already been confirmed the purchaser by the Sheriff and the court order and execution process commenced before the liquidation orders had been granted.

In this regard, Justice Chinamora was of the view that an order seeking to make Stand 666 Marlborough Township part of the applicant’s assets could not be competently made without first nullifying the order which declared the property especially executable.

“I am not satisfied that the applicant established enough facts before the court to bring Stand 666 Marlborough Township within the definition of assets of the company in liquidation,” said Justice Chinamora.

“I am therefore, unable to treat the property as an asset of the applicant for the purposes of the relief sought.”

Regarding the effect of sale of mortgaged property without the consent of the Deposit Protection Corporation, Justice Chinamora said the position of the law was that a mortgagee retained his/her hold over that property until the obligation secured by the property is discharged.

In this regard, Goldlock could not have entered into an agreement of sale in respect of Stand 666 Marlborough Township without the consent of the mortgage holder, being the Deposit Protection Corporation, said the judge.

“Therefore, after looking at everything in the round, I am firmly of the view that the applicant has not made out a case for the declaratory relief that it seeks,” said Justice Chinamora criticising the actions of Goldlock liquidator which frustrated the transfer of the property to AL Shams Global.

Goldlocks placed itself under voluntary liquidation before transfer of title was effected and then signed an agreement of sale with Mr Manyika without the knowledge of the Sheriff and AL Shams Global who had been declared the highest bidder.

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