eBusiness Weekly
— Claims RBZ facilitated illegal title deed transfer n Demands RBZ mediation, $10m for damages since 2012
Business Writer —
The Reserve Bank of Zimbabwe has been sucked into the ongoing property wrangle by a real estate company, Equity Properties, which claims the apex bank allegedly facilitated the illegal transfer of its title deeds to businessman Jayesh Shah.
Equity Properties (Private) Limited, developer of the Golden CT Residential Suburb, claims Shah’s Al Shams Global BVI Limited took its title deed from Interfin Bank unlawfully with questionable assistance from the RBZ, then under the leadership of Dr Gideon Gono. Further, Equity Properties said Al Shams took its Bankers Acceptances from Interfin without paying for them, and up to now, the BA’s had not been exchanged for their value.
Equity Properties is demanding $10 million for the loss it suffered as a result of the withholding of the title deed since 2012.
“All these things happened under the watchful eye of the RBZ at that time. Your refusal to release our title deeds is undermining our efforts to let bygones be bygones because what you did, if not corrected properly, will continue to damage us.
“In 2012, during the time of Dr Gono as Governor of the RBZ, you (Al Shams) made a report against Equity Properties to the RBZ and we were not given a chance to respond to your allegations against us before the RBZ made a decision on your report.
“Hence, we were denied natural justice by both yourselves and the RBZ at that time. For that reason the proposed RBZ mediation will provide us with a chance to respond to your allegations against us,” said Equity Properties in a proposal letter seen by Business Weekly.
The real estate company wants the matter resolved out of court, with RBZ as mediator, as this was a faster method of settling the dispute, which minimises collateral damage to depositors of Interfin Bank, purchasers of Equity Properties housing project and general confidence within the banking system. The real estate firm made the demands and claims in a proposal letter to Al Shams for an RBZ mediated out-of-court settlement, dated November 17, 2017, in which it raises several questions and grey areas it wants resolved.
Equity Properties said it did not sign an agreement for the cession of its title deed, which Al Shams has been holding since 2012, although the real estate company had fully repaid the loan, against which the now defunct bank held the title deed. Now, it cannot give title deeds to its housing project beneficiaries, due to the title deed being held by Al Shams. Al Shams claimed the title deed was ceded to it as part of assets it took over for the over $25 million it is claiming from Interfin. The firm allegedly pressured the central bank to be given preference, as preferred creditor of the liquidated bank.
“We disagree strongly with your claim because our title deed was not ceded to you as we did not sign the security assignment agreement to enable such cession. It was your condition with Interfin Bank that such security assignment agreement be signed by the borrower. Your continual holding of our title deed is unlawful and has damaged us at least $10 million and we intend to claim such damages (from Al Shams).
“The mortgage bond on our title deed, which you are holding, was cancelled by court under case number HC 3987/13.”
Equity Properties said in terms of the Bills of Exchange Act, Al Shams was also not a legal holder of the real estate firm’s BAs, since the company was neither a bearer nor an endorsee.
“The Bankers Acceptances were signed by the drawer in the normal way, but they were not further signed by the payee at the back, as endorsement to enable them to be transferrable, as required by the Bills of Exchange Act.
“The Bankers Acceptances were not exchanged for value and you also did not take them in good faith, as required by the Bills of Exchange Act,” Equity Properties said.
The real estate developer says it has been granted leave of court to sue Al Shams for at least $10 million in damages and recover its title deed. Equity Properties said Al Shams would be able to recover the $25 million it had claimed from Interfin, until the real estate company gets its damages and title deed. Equity Properties claims Al Shams used undue influence on the RBZ to acquire Interfin assets amounting to $25 million, which included the real estate firm’s $2,2 million loan from Interfin.
Equity Properties said it had fully repaid the loan against which Interfin took the mortgage bond on the title deed held by Al Shams. The company said Interfin liquidator, Peter Bailey, ignored a supervening impossibility that Equity Properties defaulted on its loan from Interfin because the central bank, which owed it through Time Bank, had also not honoured its obligation to it in time.
