Chiyangwa faces US$2,4m lawsuit

via Chiyangwa faces US$2,4m lawsuit | The Herald August 6, 2014 by Daniel Nemukuyu

Businessman Mr Phillip Chiyangwa and his two companies, Finwood Investments and Native Investments Africa, have been slapped with a US$2,4 million lawsuit after failing to settle a debt with Interfin Banking Corporation. Finwood Investments entered into an agreement with Interfin Bank in 2011 and millions of dollars were advanced to it as loans.

The company signed a deed of hypothecation in which it agreed to bond as surety an immovable property in Bluffhill measuring 3,8 hectares worth US$5,1 million.

Mr Chiyangwa and Native Investments bound themselves as surety and co-principal debtors in the deal, which forms the basis for them to be cited in the lawsuit as defendants.

Finwood failed to pay the debt, prompting the bank to issue summons for provisional sentence last week at the High Court.
In the summons filed on July 31 at the High Court in Harare under case number HC6489/14, Interfin’s lawyers, Dube Manikai and Hwacha, said they wanted US$2 433 891,99 with interest calculated at the rate of 20 percent per annum from June 24 this year to the date of payment in full.

The bank also wants Stand No. 3052 Bluffhill Township of Lot 13 to be declared specially executable.
Interfin also seeks an order compelling the defendants to pay costs of the suit and collection commission.

Finwood received various amounts of money between 2011 and this year on the strength of a deed of hypothecation registered at the registry of deeds in May 2011.

In a letter dated September 9 2013, Mr Chiyangwa, on behalf of Finwood, wrote to the curator of Interfin promising to pay the debt.
“As discussed, we are in the middle of concluding some transactions which will result in us opening our cash inflows,” he said. “We have two facilities with your bank and we are taking a practical approach to expunge our exposure.

“Our proposal is to immediately start paying off our Interfin loan and reschedule the PTA loan repayments. As a show of our good faith, we shall be paying an amount of US$50 000 in the very near future.

“You will receive a letter of undertaking from Mawere and Sibanda Legal Practitioners, confirming that they shall be remitting the funds directly to yourself once they have completed the few outstanding issues on the transaction.”

Chiyangwa and the two firms were still to respond to the law- suit.