Maureen sues Bonanza, Wellcash Debt Recovery over botched loan agreement

Former First Lady Maureen Mwanawasa has sued Bonanza Cash Express Limited in the Lusaka High Court seeking an order for the said company to surrender all title deeds and documents that she deposited as security for the loan of K420,000 that she sought from it last year.

She is also seeking an order for Bonanza Cash Express Limited to account for the K709,970 that she has paid to it for the said loan and pay back the excess against the agreed refund of K478,800.

Maureen, who has also sued Wellcash Debt Recovery (Z) Limited as second defendant, further wants the Court to grant her an interim injunction to stop the two companies from harassing or threatening her with foreclosure, sale or possession or in any way dealing with the property in Stand No. 8659 in Lusaka, until further determination of the matter.

In a statement of claim filed in the Lusaka High Court Commercial Registry on January 17, Maureen stated that she was a former First Lady and a legal practitioner, while Bonanza Cash Express was a company holding themselves out as a financial service provider dealing in the commercial transactions of money lending.

She added that Wellcash Debt Recovery on the other hand, was a Zimbabwean company with offices in Zambia holding themselves out as debt collectors.

Maureen stated that on January 9, 2019, she sought a loan of K420,000 from Bonanza Cash Express on the belief that the same was a duly registered company under the Baking and Financial Services Act No. 7 of 2017.

She stated that instead of preparing a Mortgage Deed or Finance lease facility or financial services instrument for debt contraction, Bonanza Cash Express prepared and presented to her a contract of sale dated January 9, 2019, in relation to the collateral being Stand No. 8659, Lusaka.

Maureen stated that it was a condition of the said contract of sale that she shall pay back the agreed loan amount plus interest, both totaling K478,800 on or by February 9, 2019.

She stated that in default, Bonanza Cash Express was to resort to collecting the rentals from the contract property until the agreed amount was paid.

“There was no agreement that the amount of K478,800 was to escalate,” read the statement of claim.

Maureen, however, stated that when she defaulted, Bonanza Cash Express threatened to sell the contract property and demanded that she made good the debt from her pocket instead of resorting to collecting the rentals for recovery of the debt.

She stated that when she reminded Bonanza Cash Express of the agreement, it then went ahead to collect rentals from the subject property at K90,000 per quarter for two quarters totaling K180,000.

Maureen lamented that despite the foregoing, on June 10, 2019 Bonanza Cash Express appointed Wellcash Debt Recovery to harass her for the money instead of waiting for the rentals as agreed.

“Wellcash Debt Recovery has taken advantage of the legal, social and political status of the plaintiff and has continued to harass and blackmail her in an extortive and predatory manner and has inflated the contracted debt, and charged compound interest that was not agreed upon with threats to sell the property in Stand 8659 to recover over K1,013,140.80, which was never agreed upon,” read the statement of claim.

She stated that out of being harassed and blackmailed, she had since paid a total of K529,970 plus K180,000, totalling K709,970 as at December 31, 2019, to Bonanza Cash Express.

Maureen added that she does not owe the two companies any money.

She stated that Bonanza Cash Express was not registered under the Banking and Financial Service Act No. 7 of 2017 and has no authority to be conducting in the business of financial services in Zambia.

Maureen added that the contract of sale dated January 9, 2019, was illegal and unconscionable nor was Bonanza Cash Express a bona fide purchaser for value of the property in Stand 8659, Lusaka.

She is now seeking a declaration that the transaction in issue was a mere debt agreement and not a Conveyance strictu sensu.

Maureen is further seeking a declaration that the contract of sale of January 19, 2019, and the attendant indenture of even date is illegal, absurd, unconscionable and, therefore, null and void.

She is also seeking declaration that Bonanza Cash Express’ engagement of Wellcash Debt Recovery on June 10, 2019, was unwarranted as the agreement between the parties provided a mechanism for recovery of the debt through rentals from date of default effective February 9, 2019.

Maureen also wants nominal damages amounting to K100,000 against Wellcash Debt Recovery for harassing and threatening her.




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Mwale
Mwale

So why didn’t you check those details about the company before engaging with them?

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