Zimbabwe tycoon set to get US$139 million refund from Bank of Zambia

THE HIGH Court of Zambia has ordered the country's central bank to pay back US$139, 191, 386 seized in 1998 to Zimbabwean business tycoon, Jayesh Shah, and his company Al Shams Building Materials Limited.

The judgement follows a protracted legal dispute stretching over the past 24 years.

Justice Edward Luputa Musona sitting at the Zambian High Court Thursday found the bank at fault, bringing an end to the long-running dispute.

"This is proper particularly that the history of litigation in this case dates back to the year 1998. It is 24 years old in the courts. It is the Bank of Zambia which has unduly and unjustly perpetuated this case," said the judge in delivering his ruling.

He added, "This dispute has been in a back and forth movement, from High Court to Supreme Court.

"This is sad. Litigation must have an end. 24 years in court is too long. Bank of Zambia has abused its immunity against execution. This should end because it is not good governance.

"Now therefore, I order that leave to appeal is granted but subject to a deposit by the Bank of Zambia into court of 30% of the judgment sum being US$139, 191, 386 within the period during which an appeal may be lodged. Parties may proceed to uplift this judgment," ruled Musona.

Shah has vast business interests in Zimbabwe, Zambia and India, among other countries.

The background

On January 16, 1998, Zambia's Drug Enforcement Commission (DEC) informed Al Shams Building Materials Limited's bankers – First Merchant Bank Zambia limited – and the Attorney General that it had seized the firm's accounts with over US$1 million pending investigations.

According to court papers, just months later, the bank was placed under receivership and on March 16, 1999, the Bank of Zambia ordered its liquidation.

Al Shams Building Materials Limited and Shah instituted legal proceedings in the Zambia High Court, which on October 12, 1999 ruled that the money should be returned to the owners since the seizure was unlawful and illegal.

The court ruled that in the case of First Merchant Bank failing to reimburse Shah and his company, the Bank of Zambia was held liable and, in the alternative, the Attorney General was ordered to pay if the funds could not be found.

The bank and the Attorney General appealed to the Supreme Court against the ruling and, on November 2, 2000, the appeal was dismissed and the Supreme Court held that Shah's money did not form part of the liquidation process and thus liquidation laws did not apply in Shah's case.

The Supreme Court of Zambia dismissed Bank of Zambia two further appeals on March 28, 2006 and December 31, 2012.

Fourteen years later, the Bank of Zambia again approached the Supreme Court, and its case was once again dismissed on May 2, 2014.

After being unsuccessful on appeal four times, thereafter, the Bank of Zambia on October 6, 2014 filed a motion on the May 2, 2014 appeal Judgment, 157 days out of time in terms of the laws of Zambia seeking to re-open the 2000 Appeal.

Zambian rules stipulate that a motion should be filed within 14 days of Judgment and thereafter a Court Order should be obtained to file the motion after the lapse of the 14 days statutory period prescribed by Statutory Instrument No. 26 of 2012.

Legal experts have termed the case as a test of the Rule of Law in Zambia. The New Dawn Government under President Hichelema has been advocating strict adherence to rule of law.

The question remains unanswered is will Shah and AL Shams get justice in Zambia after four times in the Supreme Court of Zambia on the same facts and the same parties.