NSSA faces $1,7m lawsuit

Senior Court Reporter
National Social Security Authority (NSSA) guaranteed $17,5 million in loans extended to a private company, Africom (Pvt) Ltd, by Stanbic Bank Zimbabwe Limited in 2011 and 2013. Africom failed to pay back the full amount with around 10 percent ($1 712 475,59) still outstanding. Stanbic Bank a fortnight ago issued summons at the High Court, claiming the outstanding balance from Africom and the two guarantors — NSSA and Fernhaven Investments.

Apparently, it is not clear whether Africom still has assets that can be attached in settlement of the debt. According to the bank’s declaration prepared by Mtetwa and Nyambirai law firm, Africom entered a loan facility agreement with the bank on March 17, 2011. The bank firstly advanced $2,5 million to Africom for the purposes of refinancing its capital requirements.

The parties entered another agreement on December 31, 2013 dubbed a facilities agreement in relation to a $15 806 424 syndicated Telecommunications Equipment Import Trade Finance Line of Credit Facility dated December 31, 2013. In terms of that agreement $15,8 million was advanced to Africom by Africa Export-Import Bank through the administrative agency of Stanbic Bank.

NSSA and Fernhaven stood as guarantors for the debt but they did not assist in clearing the debt. Stanbic Bank unsuccessfully sought payment from Africom and its guarantors, resulting in the matter spilling into the High Court. Africom repaid part of the debt and left a balance of $1,7 million.

“Despite demand, first defendant (Africom) has refused, neglected or otherwise failed to settle the amounts owing to plaintiff while second defendant (Fernhaven) and third defendant (NSSA) failed to make good on their guarantee executed in favour of first defendant as a material term of the agreement on the 31st of December 2013,” reads the declaration.

Stanbic is claiming the $1,7 million from the defendants as well as an order declaring the debtor’s assets executable. The bank is also claiming costs of the suit on a higher scale. The three defendants are yet to respond to the lawsuit.