Bank loses appeal

held a notarial bond for the same assets that Gamster Petroleum now has permission to sell as security for a loan. It wanted to prevent the second creditor from attaching Lobels movable assets on the basis that the bread-making firm had hypothecated the same property earlier.
Metbank last April extended to the struggling Lobels US$1,5 million to finance working capital requirements and all the firm’s movable property was held as security. The bank sought to block Gamster Petroleum that had been granted a court order to attach Lobels’ assets to recover an unpaid US$127 000 debt from executing the order.
But Justice Andrew Mutema threw out with costs an urgent chamber application by the bank saying the notarial general bond relied upon by Metbank could not supercede judicial attachment. He gave Gamster the greenlight to proceed with the sale of the property.
The court held that it was unfair to stop the sale considering that the amount to be recovered by Gamster would not chew much into Lobels’ asset base. According to the failed urgent chamber application, the bank stated that Lobels failed to honour the debt resulting in them separately issuing summons.
The case is also pending at the High Court. – CR.
Gamster had already obtained a judgement compelling Lobels to pay its debt and got an order to attach movable property to recover the money.
The publication of the notice of sale of the attached property by Ruby Auctions was the one that sparked the row prompting the bank to seek a legal recourse through an urgent chamber application.
The auction was scheduled for the weekend.
Last year Sadie Transport attached over 20 trucks from Lobels in another unpaid debt and the company is facing more debt claims.