THE DEVELOPMENT Bank of Zambia insists that the two directors of the defunct Zambian Airways, Fred M’membe of the Post Newspaper and Nchima Nchito, must be joined to the proceedings as they actually constituted, together with other defendants, a common enterprise for unlawful purposes and as instruments of fraud.
This is contained in the heads of arguments filed in the Supreme Court of Zambia in protest against the High Court ruling which dismissed an application to join the two directors to the bank’s defence in demanding the pay back of the K14 million loan.
High Court Justice Justine Chashi in his ruling dismissed an application to join Mine Air Services Limited, Zambian Airways Limited, Fred M’membe and Nchima Nchito as the first, second, sixth and seventh defendants to the court proceedings to recover the K14 million loan owed to the bank.
But DBZ in its heads of arguments has insisted that no company should be used as an avenue to conceal fraud, and that the courts must defend public interest including individuals and companies against injustices which may come out of such fraudulent transactions.
DBZ has requested the Supreme Court to overturn the ruling of the High Court and add the Post Newspaper editor in chief and his business partner, Lusaka lawyer Nchima, as defendants in a matter it has sued JNC Holdings and two others over the K14 million debt.
They argued that the High Court justice misdirected himself when he ruled that Mr M’membe, Nchima, Mine Air Service Limited and the Zambian Airways could not be added as parties to the action because there was no convincing case as to why they could be joined as defendants.
“It is also our submission that contrary to the findings by the court below, the appellant herein did demonstrate a strong and convincing case as to why the intended 6th and 7th defendant ought to have been added to the proceedings, and showed the role they allegedly played in their individual capacities,” read the arguments.
In its heads of arguments, DBZ charged that they demonstrated strong and convincing reasons for the joinder of the two directors, as well as for the purpose of the court to expunge from its records, statements of Richard Phiri and James Kapesa henceforth.
The bank has appealed to the Supreme Court to allow its application, arguing that the refusal by Mr Justice Chashi to expunge the statements from the court record was misconceived because a witness statement was merely a document containing the evidence in chief of any witness.
They argued that the verdict that the two defendants could not be added as parties because they were not party to the Syndicated Loan Agreement, ought to be overturned.