Court orders advocates to appear for pre-trial The High Court has ordered advocates for FBME Bank Limited to attend final Pre-Trial Conference (PTC) scheduled for August 14, in the dispute with its two former customers involving payments of four million US dollars (about 6.4bn/-). Judge Rose Teemba gave the order after counsel for the Bank failed to show up in two consecutive court sessions of which during the PTC, the parties were required to frame up issues that would guide the court to determine the dispute in question. In the dispute, two businessmen, Islam Abdallah and Quresh Delaware, are suing the Bank, demanding such amount being compensation for loss of business allegedly caused for unlawfully retaining their titles. After the parties had failed to settle the dispute through Alternative Dispute Resolution (ADR), the court directed the first PTC to be held on June 4, this year, but the advocates for the Bank allegedly failed to attend. The case was adjourned to July 8, this year, but once again counsel for the Bank did not show up. The bank in the matter is represented by lawyers from Rex Attorneys, while counsel from M &A Attorneys appears for the two businessmen. Other two defendants, as necessary parties in the matter are FM and F Limited and African Consolidated Mining Corporation (Mining Corporation). In the case, the two businessmen are requesting the Court to declare that the Bank’s move of holding their titles, one with Certificate Right of Occupancy (CRO) No. 18620/81 and other CRO No. 52397 is unlawful and thus should be returned. In its written statement of defense, FBME Bank Limited disputes the allegations by the plaintiffs and requested the court to dismiss the suit with costs. The bank has also raised a counterclaim for payments of 766,852 US dollars, as balance of a debt. On December 1, 2006, through Umba Sapphire Tanzania Limited, the plaintiffs signed a memorandum of understanding with African Consolidated Mining Corporation. The aim was to form a new joint venture company for holding and developing several mineral rights. It was agreed that African Consolidated Mining Corporation will take liabilities of FM and F Limited, which are with the Bank. In return, FM and F Limited will cede to the Mining Corporation all the debenture assets it had created in favor of the Bank together with the Chinese contracts. The Bank issued a letter of offer to the Mining Corporation for a facility loan of 329,000 US dollars and other 140,000 dollars overdraft. “These loans were to be advanced on the understanding that two directors of the company who are the plaintiffs will register the third party mortgage over their properties title number 18620/81 and 52397, respectively,” reads a section of plaint of the suit. Among the assets secured by the debenture, according to the plaint of the suit, were a private aircraft with registration number Mark 5H-KSN serial number 421B-0966. However, while knowing that it has not ceded the assets of FM and F Limited to the Mining Corporation and created security either in the form of debenture or mortgage, the bank allegedly went on to disburse the loan to the Mining Corporation. “It was a conditional precedent that the disbursement of the said loans was to be made after the said securities have been duly registered,” the plaint of the suit states. It was on the basis of terms of the agreement the plaintiffs handed over the two titles for due diligence as reflected in the facility letter. The disbursement of the loan in question was done without notification to the plaintiffs and in total disregard to the conditions which were laid out in the letter of offer. As a result, the titles were held by the defendant bank without much ado and the assets of FM and F Limited were nowhere to be seen. In its defense , the Bank claims that it had made the disbursements as agreed in the facility letter in that part of it was utilized for offsetting the liability of FM and F Limited account and the other part credited to the account of the Mining Corporation in which both the plaintiffs were signatories. It further denies breaching any terms of the letter of offer and, or failed to respond to the plaintiffs’ demands or held any of their title unlawfully as alleged in the plaint of the suit. The bank further alleges that the claim for return of the title deeds was time barred and liable to be dismissed. By FAUSTINE KAPAMA, Tanzania Daily News
Posted on: Sun, 13 Jul 2014 11:28:07 +0000
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