USD debts can be repaid in local currency – Zimbabwe Supreme Court

The Supreme Court has ruled that all debts incurred before the 22nd of February 2019 shall be settled in the local currency on a one to one basis.

A judgement has been made by Chief Justice Luke Malaba in an appeal case against a High Court judgement by Zambezi Gas Zimbabwe.

In a development that is set to settle the dust pertaining to contestations of denomination of debts in the lower and other courts, the Supreme Court has effectively ruled that all debts accrued in US dollars or any other currency before the 22nd of February 2019 shall be rated and settled on a one is to one basis with the Zimbabwe dollar in line with the Statutory Instrument 33 of 2019.

Chief Justice Luke Malaba made the ruling together with Justice Susan Mavingira and Justice Nicholas Mathonsi Mathonsi in an appeal case involving Zambezi Gas Zimbabwe (Pvt) LTD against V.N.R.Barber and the Sherriff of Zimbabwe.

Details are that V.B.R (first respondent) Barber offered services to Zambezi Gas Zimbabwe services in May 2018 to the tune of US$3 885 000.00.

It follows that in May 2019 after the promulgation of S.I 33 of 2019 the Zambezi Gas, following a high court order went on to pay the first respondent RTGS$ 4 136 806.54, being debt plus interest.

However, the V.B.N Barber insisted and made an application that it was still owed US$ 3 992 018.31 as the amount paid was just US$144 778.23 using the payment date’s interbank rate in May.

V.B.R Barber therefore instructed the Sheriff, cited as the second respondent, to attach Zambezi properties in Hwange to settle the outstanding debt of US$3 992 018.31.

In making his ruling, Chief Justice Malaba said “The High Court further erred in failing to find that the US dollar debt was capable of being discharged at a rate of one US dollar to One Rtgs dollar as specified in Section 4(1)(d) of SI 33/19 and therefore failing to find that the appellant fully discharged the debt on 21 May 2019″.

In conclusion, Chief Justice Malaba ruled ” The payment of Rtgs$ 4 136 806.54 made by the appellant was in full and final settlement of the debt in terms of Section 4(1) (d) of the Statutory Instrument 33 of 2019.