M’membe challenges Post liquidation, sues ZRA

Post Newspaper founder Fred M’membe

Former Post Newspaper proprietor Dr Fred M’membe has sued five ex-employees together with the Zambia Revenue Authority for consenting to wind up the company without his permission.

But Post Liquidator Lewis Mosho has filed a motion to discontinue the case saying the company no longer exists.

Dr M’membe, who jointly sued with The Post Newspaper Limited in Liquidation, is seeking an order to set aside the consent judgement dated January 10, 2018 in which The Post was declared bankrupt and wound up, saying it was illegal and obtained by fraud.

Dr M’membe is also seeking an order to stay the proceedings and orders granted by High Court judge Sunday Nkonde in the matter that was before him.

The former editor-in-chief is also claiming any other relief that the court might deem fit and costs.

In his statement of claim, Dr M’membe stated that he had commenced the action against his employees and ZRA in his own capacity as a director and shareholder of The Post.

In this matter, the ex-employees; Abel Mboozi, Roy Habaalu, Andrew Chiwenda , Mwendalubi Mweene, Bonaventure Bwalya, commenced an action to wind up the company under cause number 2016/HPC/518 on November 1, 2016 claiming that the newspaper had failed to pay them their money amounting to K815,000.

The former employees had proposed Mosho as provisional liquidator who was then appointed by an exparte order of court dated November 1, 2016.

The ex parte order appointing Mosho as provisional liquidator was challenged by The Post Newspaper Limited on November 2, 2016 through its appointed advocates Messers Nchito and Nchito, of which an application to stay the liquidation was also made.

“The basis of the application was that mosho having been removed as receiver of Platinum Gold Equity Limited, Kitwe Development Limited and Optima Business Consultants Limited by an order of the then High Court judge Mr Justice Mutuna dated 22nd October 2015 under cause number 2015/HPC/0097, could not at law be appointed as liquidator, provisional or otherwise. Secondly, the petitioners had not made a statutory demand for the payment of the monies they claimed as required by the law before a company could be liquidated. In the making of the applications payment of the monies claimed by the petitioners in court was tendered in exchange for letting The Post continue as a business concern. These applications have not been heard to date,” M’membe argued.

“On the same date, the appointed provisional liquidator Mr Mosho purported to terminate the services of Nchito and Nchito advocates and appointed his own firm Messers Lewis Nathan and Messers Palan and George to represent The Post and also take over the challenge, the liquidation and his own appointment as provisional liquidator. Mosho’s firm went ahead and signed the consent order which confirmed him as liquidator.”

Dr M’membe stated that on November 3, 2016, Mosho’s firm discontinued the applications for stay and setting aside the appointment of the provisional liquidator.

“I filed a notice to be heard as an interested party in the exparte liquidation action under rule 10 if the winding up rules which allows a party interested in a liquidation to be heard without application. As an interested party, I also filed an application to set aside the order appointing Mr Mosho as provisional liquidator and to stay the liquidation action, both exparte and the applications have not been heard up to date,” M’membe argued.

The former director says justice Nkonde granted strange exparte orders to Mosho.

He stated that Justice Nkonde was directed by Chief Justice Irene Mambilima to recuse himself from handling the exparte liquidation action which direction he failed to comply with.

Dr M’membe also recalled that the Judicial Complaints Commission had found Justice Nkonde with a prima facie case concerning his conduct.

“Without hearing various applications made by the plaintiffs challenging the entire process, Justice Nkonde and the defendants signed a consent order on January 10 declaring The Post insolvent without hearing from it through its lawyers of its choice and without having the statutory inter parte return hearing for the appointment of a provisional liquidator,” Dr M’membe stated.

He contended that as a party, he had not signed the said consent order.

He stated that particulars of fraud were that the five former employees of The Post, whose claim had been disputed, proposed and obtained an exparte appointment of a provisional liquidator who by law was disqualified.

Dr M’membe claimed that the exparte order of appointment had been used for purposes of illegality such as the removal of Nchito and Nchito Advocates and the appointment of the provisional liquidator’s own firm to defend the challenge of his own appointment.

He stated that other particulars of fraud were that concluding the liquidation action, exparte, without ever hearing at least four applications challenging the entire action and without the consent order being signed by him.

But Mosho filed in a notice to discontinue the matter against the defendants saying The Post no longer exists.

“Take notice that the 2nd plaintiff herein, whole and unconditionally discontinues this cause of action and or matter all against defendants,” stated Mosho.

In an affidavit in support of summons to dismiss the matter on point of law sworn by Bonaventure Bwalya, the former employees state that the newspaper company through its new advocates on record, had withdrawn all its claims against them as The Post is no longer a party to the proceedings.

Bwalya on behalf of other employees states that M’membe, as the remaining plaintiff on record does not have sufficient interest in the the winding up process of The Post Newspaper Limited in Liquidation, a company whose liabilities exceed the value of its assets.

“M’membe was aware of the winding up or of The Post in Liquidation from the time of representation of the petition for winding up under cause number 2016/HPC/0518 but did not at any time oppose or challenge the winding up proceedings. The plaintiff had filed a number of applications in the matter even if he was not a party thereto,” stated Bwalya.

He argued that Dr M’membe’s action to commence a new cause of action having deliberately omitted to join the winding up proceedings was clearly a “forum shopping venture, an abuse of court process and a multiplicity of causes of action”.

         

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