News / National
Biti sues First Mutual Holdings for $15m
23 Aug 2019 at 07:43hrs | Views
MDC deputy president Tendai Biti has taken First Mutual Holdings Limited to court demanding that upon retirement, the pension fund should pay him the contractual $15 million sum assured after the insurance company debased his policy.
In summons filed recently at the courts, the Harare East MP said in 1993, while he was a partner at Honey and Blanckenberg law firm, his pension contributions were with his consent converted by First Mutual into an annuity policy.
"The annuitisation phase commenced with a payment of $15 648,04 and the written projection given by defendant (First Mutual) was that upon attaining the retirement age of 60, plaintiff would be paid a capital
value of $4 133 593 and an annual pension of $782 066,47 giving a total assured sum of $15 000 000," he said.
"In breach of the agreement between the parties and taking advantage of the changes in currency that occurred in the 2009, defendant has unilaterally claimed that as at March 2009, the value of plaintiff's policy was US$196,76 and US$327,28 as at December 31, 2015."
The legislator said the unilateral position taken by First Mutual Holdings means that it will, upon his retirement, pay less than the agreed value of the annuity policy.
"In terms of the purchasing power parity theory which constitutes an integral tacit term of the insurance relationship between the parties, plaintiff (Biti) is entitled to a payment which preserves and reflects the total value by which he was insured," he said.
Biti added that despite there being an agreement between the parties, First Mutual Holdings had refused, even in the light of the findings made by a presidential commission of inquiry, to take a position which recognises and upholds the essence of what was agreed to, rendering it necessary for the court to declare the correct position for the guidance of the parties.
First Mutual Holdings is yet to enter appearance to defend notice.
In summons filed recently at the courts, the Harare East MP said in 1993, while he was a partner at Honey and Blanckenberg law firm, his pension contributions were with his consent converted by First Mutual into an annuity policy.
"The annuitisation phase commenced with a payment of $15 648,04 and the written projection given by defendant (First Mutual) was that upon attaining the retirement age of 60, plaintiff would be paid a capital
value of $4 133 593 and an annual pension of $782 066,47 giving a total assured sum of $15 000 000," he said.
"In breach of the agreement between the parties and taking advantage of the changes in currency that occurred in the 2009, defendant has unilaterally claimed that as at March 2009, the value of plaintiff's policy was US$196,76 and US$327,28 as at December 31, 2015."
The legislator said the unilateral position taken by First Mutual Holdings means that it will, upon his retirement, pay less than the agreed value of the annuity policy.
"In terms of the purchasing power parity theory which constitutes an integral tacit term of the insurance relationship between the parties, plaintiff (Biti) is entitled to a payment which preserves and reflects the total value by which he was insured," he said.
Biti added that despite there being an agreement between the parties, First Mutual Holdings had refused, even in the light of the findings made by a presidential commission of inquiry, to take a position which recognises and upholds the essence of what was agreed to, rendering it necessary for the court to declare the correct position for the guidance of the parties.
First Mutual Holdings is yet to enter appearance to defend notice.
Source - newsday
