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Debt Interest re: Contractual, Statutory, Judgment, Penalty, Usury, Accrual of Interest and Economic Inflationary Trends

HH44-09 : BLESSMOE CHANAKIRA and AUXILIA DANAYI MYNYEZA vs MAI KAI REAL ESTATE DEVELOPMENT TRUST and BERNARD MUTANGA
Ruled By: BERE J

Application in terms of Order 29 of the High Court Rules, 1971.The BackgroundThe agreed facts of this matter, as given by the parties, are as follows:-On 9 November 2004, the plaintiffs entered into an Agreement of Sale with the first defendant, represented by the second defendant, in respect of the ...
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HH29-12 : CHIEDZA CHIKOMO vs YISRAEL YEHUDAH
Ruled By: MAVANGIRA J

The following is also stated on the acknowledgment of debt: “I agree that if I fail, for any reason, to pay this amount by the agreed date an interest of 25% will be charged….,.”…,. In casu, the respondent does not deny liability in respect of the principal debt in the sum of US$9,500=. His opposition to the application ...
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HH87-10 : VENETIAN BLINDS SPECIALISTS LIMITED vs APEX HOLDINGS (PRIVATE) LIMITED
Ruled By: PATEL J

Interest Claims The summons (as amended) incorporates two separate claims for interest. The first is in respect of the Malawi kwacha award, and is equivalent to the in duplum interest on the capital sum awarded. The second relates to the award of special damages denominated in United States Dollars in respect of which the plaintiff seeks ...
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HH95-10 : TIISO HOLDINGS (PTY) LIMITED vs ZIMBABWE IRON & STEEL COMPANY LIMITED
Ruled By: PATEL J

The plaintiff in this matter has issued summons for payment of the sum of EUR6,640,295=94 together with interest and costs of suit.The claim arises pursuant to a default judgment of the Regional Court of Frankfurt entered in favour of Kreditanstalt fur Wiederaufbau (KFW) as against the defendant on 25 July ...
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HH183-10 : LUKE CHIGWIDA and MAVIS CHIPFUPA vs WITBEST ENTERPRISES (PRIVATE) LIMITED and SYDNEY CHADA and MAINLINE TANKERS and STANLEY CHIHURI
Ruled By: MAVANGIRA J

In addition, the rate of interest can only be granted as the law stipulates, at 5% per annum.
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HH206-10 : STANBIC BANK ZIMBABWE LIMITED vs FLAIR FURNITURE COMPANY (SUCCESSORS) LIMITED
Ruled By: MTSHIYA J

Mr Weston Munashe Makwara said the interest rate chargeable was incorporated in the Agreement and that the London Interbank Offer Rates (libor) used were extracted from Reuters. He said all banks, including the Reserve Bank of Zimbabwe, had access to Reuters and relied on Reuters for interest rates. Mr Neil James Bruce said because he was ...
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HH268-10 : TOTAL ZIMBABWE (PRIVATE) LIMITED vs APPRECIATIVE INVESTMENTS (PRIVATE) LIMITED
Ruled By: KUDYA J

I would order that interest, at the prescribed rate, starts to run from the date of the service of summons for both the arrear rentals and holding over damages.
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HH73-13 : SIBONGILE KAZIBONI vs CHAMPION CONSTRUCTION (PRIVATE) LIMITED
Ruled By: MATHONSI J

Whether the plaintiff has failed to pay interest due on the purchase price Clause 2(i) of the written Agreement provides for interest of 120% per annum to be levied on the balance of the purchase price. There is nothing in the evidence led by the defendant to suggest that any computation of that interest was ever ...
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HH113-11 : ALSHAMS BUILDING MATERIAL t/a LLC (a company incorporated in the United Arab Emirates) vs TAPERA NYEMBA and CHRISTOPHER GOROMONZI and JOSPHAT SACHIKONYE
Ruled By: KUDYA J

Clause 2.2 of the loan agreement showed that US$1,933,000= was the actual amount disbursed to Barato Holdings Limited. The effect of paying the full loan amount when what had been disbursed was US$1,933,000= meant that Barato Holdings Limited agreed to pay the difference between the loan amount and the disbursed amount represented by US$290,000=, firstly, ...
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HH190-14 : AFRICAN BANKING CORPORATION OF ZIMBABWE LIMITED vs SUNJET DEVELOPMENT HOLDINGS (PRIVATE) LIMITED
Ruled By: MAKONI J

The respondent, in its Heads of Argument, makes a bold statement that the interest rates and penalties of 50% charged by the applicant “are oppressive, unfair and prejudicial to the respondent as it is contrary to common accepted standard of fair dealing in the supply of banking services”. It abandoned the claim that the interest ...
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HH254-14 : NMB BANK LIMITED vs BRAITWOOD TRADING (PVT) LTD and BRABOURN INVESTMENTS (PVT) LTD and TAKESURE MAGORONGA and BERNARD MUTANGA
Ruled By: NDEWERE J

In their plea, the defendants admitted paragraphs 1 to 12 of the plaintiff's declaration although they amplified the facts surrounding paragraph 11 of the declaration. They disputed paragraphs 13 to 16 of the declaration. Despite denying the interest rates in the plea, the facility agreement, which has been availed as part of the evidence to the ...
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HB36-14 : PLAUDIT CHEMICALS CC vs AFRICAN ASSOCIATED MINES and SMM HOLDINGS (PRIVATE) LIMITED
Ruled By: MAKONESE J

Interest The plaintiff avers that the plaintiff operates a business involved in the supply of goods for the mining industry and that there was an understanding that interest should be levied on overdue accounts. The plaintiff argues that the goods were supplied on a 90 day account and that it follows, naturally, that after the expiration ...
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SC01-15 : FIRSTEL CELLULAR (PRIVATE) LIMITED vs NETONE CELLULAR (PRIVATE) LIMITED
Ruled By: ZIYAMBI JA, GARWE JA & PATEL JA

This is an appeal against the decision of the High Court granting summary judgment against the appellant in the sum of US$8,330,470=52 together with interest at 2.5% per annum above the prime overdraft Bank rate and costs of suit.The claim against the appellant arose from a Service Provider Agreement concluded ...
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SC33-15 : APEX HOLDINGS (PRIVATE) LIMITED vs VENETIAN BLINDS SPECIALISTS LIMITED
Ruled By: GWAUNZA JA, GOWORA JA and GUVAVA JA

As regards the issue of interest, the appellant argued that the court a quo erred in awarding interest on the judgment amount. It was further contended that the Courts' Act Malawi [Chapter 302], in terms of which provision is made for interest to be levied on Malawi judgments, does not apply to amounts ...
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SC49-17 : PHILLIP ELLSE vs MICHAEL JOHNSON
Ruled By: GARWE JA, GUVAVA JA and UCHENA JA

Whether or not the interest rate charged renders the whole loan agreement a nullity?Counsel for the appellant submitted that the loan agreement was invalidated by the interest rate of 7 per cent per month which is above the prescribed rate of interest. He submitted that the interest rate of 7 per cent per month ...
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Appealed
HH357-16 : ROBSON MAKONI vs CBZ BANK LIMITED
Ruled By: CHITAKUNYE J

The applicant also challenged the interest rate of 28% being claimed. He alleged that the agreed interest rate was 12%. In this regard, he referred to paragraph 7.1.1 of the Agreement. That paragraph indeed provides for an interest rate of 12% per annum on the facility offered. The applicant somehow opted to ignore ...
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HB95-16 : NATIONAL RAILWAYS OF ZIMBABWE CONTRIBUTORY PENSION FUND vs EKUTULENE INVESTMENTS t/a WALKERS PUB AND RESTAURANT and WAYNE ALLAN JONES
Ruled By: MATHONSI J

This court has to uphold the sanctity of the contract…,. The same applies to interest which is provided for in the agreement. It is not enough for the defendants to object to the production of the letter from the Bank attesting to what the Bank interest rate used was.
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HH115-15 : MEGALINK INVESTMENTS vs OWEN MURIMBI and THERESA MUSINA and AFRICAN CENTURY LIMITED and SHERIFF, HIGH COURT OF ZIMBABWE
Ruled By: TSANGA J

Also, the applicants argued that they have a strong defence to the claim and that their case stands a high chance of success in that they previously disputed the amount being charged as interest - a fact they say the respondents acknowledged by duly crediting their account, at one point, with an amount of $62,844=39….,. On merit, ...
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HH711-15 : GOLDSEARCH TECHNICAL SERVICES (PRIVATE) LIMITED vs TAONGA MUKONOWESHURO and SHERRIFF OF ZIMBAWE
Ruled By: TSANGA J

An agreement was then entered into in terms of which…., a higher interest rate on the capital amount…, was now fixed at 20% per annum…,. The applicant…, reneged on the agreement arguing that the agreement was illegal; usurious…,. As regards the interest being usurious, the first respondent's position is that the agreement between the parties is not a money lending ...
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HH98-16 : VADAC PROPERTIES [PRIVATE] LIMITED vs CURE CHEM OVERSEAS [PRIVATE] LIMITED
Ruled By: MAFUSIRE J

The plaintiff has also prayed for interest on the amount of damages at the prescribed rate, currently five per cent per annum [5% p.a.], to be reckoned from 29 May 2014. I have gathered from the plaintiff's declaration that this date was the date of the demand for payment. However, I consider that interest should not be ...
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HH129-15 : DELTA BEVERAGES (PVT) LTD vs ZIMBABWE REVENUE AUTHORITY
Ruled By: MAKONI J

In Scoin Trading (Pty) Ltd v Bernstein NO 2011 (2) SA 118 SCA…, following Bellairs v Hodnet Anor 1978 (1) SA 1109 (A)…, PILLAY AJA had this to say:- “If a debtor's obligation is to pay a sum of money on a stipulated date and he is in mora in that he failed to perform on or ...
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HH484-14 : L.M.S. TIMBERS (PVT) LTD and LUKA PHAKATHI vs THE SHERIFF OF ZIMBABWE and PEOPLE'S OWN SAVINGS BANK and SETH CHIGODORA
Ruled By: MATHONSI J

The second applicant also alleges that the 30% interest levied by the second respondent is unlawful without explaining why that would be so when the applicants committed themselves to that on the loan agreement.
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HH161-15 : MCR VENGESAYI and AGNES VENGESAYI T/A VENGESAYI ARHITECTS vs BELVEDERE NURSING HOME (PRIVATE) LIMITED
Ruled By: DUBE J

The following issues were referred for trial: 1….,. 2….,. 3….,. 4….,. 5. Whether interest on the sum should be paid at the rate of 16% per annum….,. The last witness called by the plaintiff is Emmanuel Mbodza, a Part 2 ACCA student. He testified on the interest rate of 16% levied on the fees charged and based on the overdraft percentage ...
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HH183-15 : ZB BANK LIMITED vs ERIC ROSEN (PVT) LTD and ERIC ANTHONY ROSEN and ELIZABETH ROSEN
Ruled By: MAFUSIRE J

By agreement, the parties referred this matter to court as a Special Case in terms of Order 29 of the Rules of this Court. In my view, this was a mistake. My reasons for saying this are towards the end of this judgment. The defendants' defence was a frontal attack on the propriety of the penalty rate ...
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HH183-15 : ZB BANK LIMITED vs ERIC ROSEN (PVT) LTD and ERIC ANTHONY ROSEN and ELIZABETH ROSEN
Ruled By: MAFUSIRE J

(f) Usury Disagreements have extended to the question whether under the common law the courts can fix a rate of interest above which it becomes usurious. Perhaps this is best illustrated by African Dawn Property Finance 2 (Pty) Ltd v Dreams Travel and Towers CC 2011 ZASCA 45. The facts of that case are remarkably similar to those of ...
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HH43-06 : ZIMBABWE DEVELOPMENT BANK vs NAGA SALONS and NYARAI CHIWAURA and BETTY CHIWAURA
Ruled By: KUDYA J

WHETHER OR NOT THE DEFENDANTS ARE LIABLE TO PAY THE BANK CHARGES IN THE SUM OF $87,612,879=86 In his testimony, Dumisani Sibanda stated that before the Bank disbursed the $250 million to the company it assessed and approved the application made. The purpose of the loan was for the company to liquidate its own debtor's invoices. The ...
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HH654-14 : JAMES GUMBI vs MANDY MARGARET MAJONI
Ruled By: CHIGUMBA J

The defendant narrated the background to the debt as follows: Sometime in July/August 2013 she was introduced to the plaintiff by her friend, Collin Maworerea. Her friend told her that the plaintiff was in the money lending business. The defendant was in urgent need of US$15,000= with which to fund a business venture. When the parties met, ...
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HH207-15 : G BANK ZIMBABWE LTD vs ZIMBABWE REVENUE AUTHORITY
Ruled By: KUDYA J

In Commissioner of Inland Revenue v Lever Brothers and Unilever Ltd 14 SATC 1…, WATERMEYER CJ observed that:“The provision of credit is the originating cause or source of the interest received by the lender.”
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SC47-20 : ROBSON MAKONI vs CBZ LIMITED
Ruled By: GWAUNZA DCJ, GUVAVA JA and MAKONI JA

This is an appeal against the whole judgment of the High Court sitting at Harare in which the court dismissed an application for rescission of a default judgment entered against the appellant on 23 July 2015.BACKGROUND FACTSOn 19 March 2015, the respondent issued summons against the appellant in the High ...
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HMT55-19 : CAMBRIA AFRICA PLC vs BREASTPLATE SERVICES (PRIVATE) LIMITED T/A NEMCHEM INTERNATIONAL
Ruled By: MUZENDA J

The matter of AMI Zimbabwe (Pvt) Ltd v Casalee Holdings (Successors) (Pvt) Ltd 1997 (2) ZLR 77 (S)…, is apposite where it was held that it was proper not only to give judgment in a foreign currency but also to couple such award with standard order that interest on the ...
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Appealed
HH46-09 : MATTHEW MBUNDIRE vs TYRONE SIM BUTTRESS
Ruled By: CHATUKUTA J

At the conclusion of the trial, I directed that the parties file closing submissions by close of business on 31 October 2008.The plaintiff filed his submissions timeously. Despite numerous reminders to the defendant's counsel, the defendant did not file his submissions.I have therefore proceeded to prepare my judgment without the ...
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HH88-12 : BLUMO TRADING (PRIVATE) LIMITED t/a COLCOM COMMODITIES vs MORGAN MUDUVURI
Ruled By: MATHONSI J

It remains for me to deal with the penalty stipulation of 10% monthly interest.I do not agree with counsel for the applicant that it does not violate the provisions of the Contractual Penalties Act [Chapter 8:04].To me, 10% interest a month is excessive.In terms of section 4(2) as read with ...
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SC127-21 : MIDLANDS STATE UNIVERSITY vs GALAXY ENGINEERING DESIGN CONSULTANTS (PRIVATE) LIMITED
Ruled By: GWAUNZA DCJ, BHUNU JA and MATHONSI JA

This is an appeal against the judgment of the High Court (the court a quo) rendered in favour of the respondent on 24 July 2019 following a full trial. The judgment directed the appellant to pay to the respondent interest on the sum of $84,827=17 at the rate of 19.5% ...
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HB36-15 : BULAWAYO CITY COUNCIL vs BUTTON ARMATURE WINDING (PVT) LTD
Ruled By: MUTEMA J

This is an application for summary judgment in the sum of US$86,927=90 said to represent arrear rates for the period spanning from June 2012 to June 2014.The statement for the bill for what the applicant contends is owed was attached to the founding affidavit as annexure “A”.The founding affidavit was ...
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