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Daniel Nemukuyu Senior Court Reporter
Three Trust Holdings Limited directors – Tapera William Nyemba, Christopher Goromonzi and Josphat Sachikonye – who are challenging a High Court order compelling them to honour a US$1,5 million debt owed to businessman Mr Jayesh Shah, have been allowed to amend their appeal papers at the Supreme Court.Deputy Chief Justice Luke Malaba last week allowed the three to make amendments to their grounds of appeal already filed at the court.
The court found that there would be no prejudice to Alshams Building Materials, a company owned by Mr Shah, if the application was granted.
“The respondent has not established that any prejudice apart from the issue of costs would ensure if the amendment were to be granted, said Justice Malaba.
“There is no unfairness that has been argued and to deny the amendment might result in prejudice to the appellants. It seems to me that in order to determine the real question in controversy, it is proper, and in the interests of justice that the amendment sought be allowed.”
Advocate Thabani Mpofu represented the trio, while Adv Firoz Girach acted for Alshams Building Materials. In 2011, the High Court ordered the three to pay back US$1,5 million they borrowed in 2004 from Alshams Building Materials.
Mr Shah represented the United Arab Emirates-registered company Alshams Building Materials in a deal that granted a loan to the three. At the time, the trio operated a Jersey Island-registered firm, Barato Holdings Limited.
The directors convinced Mr Shah that Barato had the capacity to pay back the money in accordance with agreed terms. Alshams Building Materials released the money to Barato, but the loan was never repaid. According to the loan agreement, Barato was obliged to repay the loan by December 30, 2004.
Barato tendered 42 299 673 shares in Ariston Holdings as additional security. The agreement compelled Mr Nyemba, Mr Goromonzi and Mr Sachikonye to sign personal guarantees.
In default, the agreement provided that Alshams would appropriate the security given and sue the defaulters for any shortfall. In August 2005, Alshams cancelled the agreement and appropriated the Ariston Holdings shares deposited with it. The shares were at the time valued at US$683 753,44 and that prompted Alshams to sue over the shortfall of US$1,5 million.
In the opposing papers, the three argued that they have since resigned from Barato and that the appropriated shares were worth more than the loan.
They contended that the loan was repaid by way of dividend payment, together with the appropriated shares and, as such, there was no debt owed.
They further argued that the personal surety in question was unlawful and invalid because at that time no exchange control authority was sought.
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