LOCAL bank, CBZ, has sued Mashonaland East Provincial Affairs minister Ambrose Mutinhiri, for failing to service a $216 724 overdraft facility extended for his summer cropping programme in 2010.
Source: CBZ sues minister Mutinhiri over $216 000 debt – NewsDay Zimbabwe February 20, 2017
BY CHARLES LAITON
According to the summons issued in January this year under a case number, which was erroneously entered as 574/2016, CBZ said it was demanding payment of $216 724 from the minister. The bank wants cumulative unpaid capital of $108 258,37, cumulative unpaid interest of $108 258,37 plus cumulative unpaid charges of $208.
CBZ further said, in order to secure his borrowing, Mutinhiri bonded all his movable properties, which the financial institution was now urging the court to consider as executable.
“In terms of a notarial general covering bond No 6260/2010 dated November 30, 2010, the defendant (Mutinhiri) bonded all his movable property of whatsoever nature, as security for the repayment of his indebtedness to the plaintiff (CBZ Bank). Accordingly, the said movable property must be declared specially executable,” the bank said in its declaration.
According to court papers, CBZ Bank on October 8, 2010, advanced a $90 000 summer cropping overdraft facility, which would accrue interest on the drawn amount at the bank’s minimum lending rate from time to time.
“It was a term of the agreement that interest would accrue on the amount under the overdraft facility at the plaintiff’s minimum lending rate from time to time, which was 12% per annum calculated on the daily balance and compounded on a monthly basis, plus an establishment fee of 3%,” the bank said.
“Despite utilising the overdraft facility and overdrawing there from the defendant breached the agreement when he failed to repay the amounts drawn with interest, thereon, on September 3, 2014, being the date of demand. As such, plaintiff altered the interest rate to its penalty rate from time to time, currently being at 26% per annum.”
The bank further said as at September 3, 2014, Mutinhiri was indebted to the financial institution to the tune of $216 724, 74.
Mutinhiri has since responded to the lawsuit.