By Nation Reporter
THE DEVELOPMENT Bank of Zambia has lost an injunction to bar Mine Air Services from auctioning assets which include a Boeing 737 jet they held on behalf of the defunct Zambian Airways as part of the money owed to Investrust Bank.
This is in a case in which DBZ is seeking Zambian Airways together with its partners and shareholders to pay the K14 million it is owed by the defunct airline. The court ruled that DBZ did not secure its loan but Investrust did through a debenture.
The ruling by High Court judge Justine Chashi follows an inter-parte hearing over an ex-parte injunction that was granted to DBZ in December 2015 against the auctioning of Mines Air Services (in receivership) assets by Investrust Bank.
The assets include a Boeing 737-200 aircraft, a Piper Aztec Reg Z-WSN aircraft, a tractor and lathe machine owned by the defunct Zambian Airways airline.
“According to the deponent, Fred Joe Limited did on the 12th day of August, 2015 advertise in the Post Newspaper edition no. 6872, the pending auction sale of assets belonging to Mines Air Services Limited, now in receivership.
“That some of the assets advertised were 1 Boeing 737-200 aircraft 9J-JNC; 1 Piper Aztec Reg Z-WSN aircraft, 1 tractor Escort AAM 2324-2×4 and 1 lathe machine,” he said.
DBZ had applied to the High Court to restrain the disposal of assets owned by Mines Air Services Limited, also trading as Zambian Airways, after an advertisement appeared in the media. If allowed the application was going to ultimately affect the bank’s efforts to recover their unpaid loan from the airline. Earlier, DBZ had applied for Mines Air Services to be joined to the plaintiff’s case in a matter in which JCN Holdings Limited together with Post Newspapers Limited suspended Director of Public Prosecutions (DPP) Mutembo Nchito. Mines Air Services Limited had been sued in the High Court for failing to pay back K14 million owed to the bank.
Mines Air Services received a loan of US$3 million from DBZ as part of a syndicated loan agreement and the bank sought the court’s intervention in joining MAS as a defendant.
DBZ had requested the High Court to halt the auctioning of assets of the airline until determination of the matter.
DBZ had indicated to the court that they had a clear right to relief and that there was need to prevent the auction sale of any assets owned or said to be owned by Zambian Airways or any of its partner companies or shareholders as it would affect their recovery of the K14 million.
But Mr Justice Chanshi explained that due to the receivership status of Mines Air Services and that Investrust Bank had secured their loan by obtaining debentures dated October 19, 2009 various assets were realised and sought for disposal by public auction to be distributed to creditors accordingly.