Money Lender Wins Property- Dickson Jere

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Money Lender Wins Property
By Dickson Jere

In desperate need of cash, he voluntarily signed documents for sale of his property to a Chinese money lender. As per term of contract of sale, he was expected to “buyback” the property within six months. Should he fail to “buyback” the property at the agreed USD 51, 760.00, he consented to assign it to another Chinese company. Simply, he sold the property with a right to buy it back.

He defaulted. But when the Chinese money lender tried to take possession and change ownership, he rushed to the High Court. He tried to block the transaction arguing that he got a loan and that he did not sell his property.

The High Court ruled in favour of the Chinese lender. Simply, the Court did not find any evidence to suggest that he got a loan.

Dissatisfied with the Judgment, he decided to climb the judicial hierarchy and lodged an appeal in the Court of Appeal. He argued that it was a loan agreement and not sale and the property was collateral. He stated that contrary to the contract, he only received half of the money while the other half was calculated as interest.

Having analyzed the appeal, three Judges of the Court of Appeal opined thus;

“In this case, it is very clear from our reading of the contract that the parties’ intention was for the Appellant to sell and the Respondent to purchase Sub-division G27 of farm No 1408 Chingola for a consideration of USD51, 760.00,” the Judges observed.

“The buyback provision in the contract does not, in our view, imply that parties entered into a loan agreement secured by a mortgage,” the panel opined.

Further, the Court observed that the receipt which was issued by the property owner to the Chinese indicated sell of property and it was given two days after the transaction was completed and duly executed.

“The Appellant appears to have been in a desperate financial need and went into an agreement by which he hoped to outsmart the Respondent” the Judges observed as a by the way (orbiter dicta).

“This is evident from the fact that despite the clear, plain and unambiguous language in which the contract is couched, the Appellant attempted to persuade the Court below into believing that it was actually a mortgage when in fact it was a contract of sale.”

This Judgment is must read by all money lenders, estate agents and law students especially those pursuing commercial law and law of contract.

The panel comprised of Judges Chashi, Siavwapa and Banda-Bobo.

Case citation – Bwalya Chishimba Kambwili v Greatwall Financial Services Limited (Appeal No 028 of 2021). Judgment was passed last month.

This summary is for academic and intellectual discourse and is not in anyway legal advice. Kindly seek legal advice from your lawyer if confronted with similar case.

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