Battle lines drawn over liquidation case

Battle lines drawn over liquidation case

RapelangMosae

MASERU

THE Commercial Court is today expected to hear a case in which Mining Minister LebohangThotanyana’s company is embroiled in a liquidation clash with First National Bank Lesotho (FNB).

At stake is a fleet of vehicles, two 2011 Mercedes BenzesAxors and four 2012 Mercedes Benz Axors, which his company bought after it was financed by the First National Bank (FNB) Lesotho.

FNB wants to dispose the trucks so that it can reclaim its money.

The company,Thotanyana Mining and Civil Works, is under liquidation and the liquidators claim the assets are estate assets and that FNB is a creditor of the estate whose claim is secured by the assets.

Papers filed in court show that it was agreed between the liquidators and FNB that the liquidators will retain control of the assets, but for the sake of convenience and limiting costs of storage they were to be safely stored by FNB as agents of the liquidators.

FNB however refused to make an undertaking to the liquidators not to dispose of the assets.

On April 21, 2016 FNB wrote a letter to the Master of the High Court in a bid to get permission to dispose the assets in order to recover their expenses.

“We also confirm that we are a creditor of the estate (Thotanyana Mining and Civil Works) in respect of six separate Hire Purchase agreements for the purchase of six trucks as defined and governed by the Hire Purchase Act 1974,” part of the FNB letter reads.

“Section 2(1) of the Hire Purchase Act defines a Hire Purchase agreement as one where, amongst others, the goods are sold subject to the condition that ownership shall not pass merely by transfer of possession of such goods to the Purchaser,” the letter reads.

The letter goes further to bring to the attention of the master that the Hire Purchase agreement entered into between Thotanyana Mining and Civil Works and FNB specified that the purchaser shall only become the owner of the goods when the purchaser has paid the seller the fullamount that the purchaser owes.

FNB indicated that Thotanyana had not paid the full amount hence ownership had not passed over to his company.

FNB further submitted that the final liquidation had vested the assets of the company in the liquidators. However the assets bought under hire purchase did not form part of the insolvent estate as the condition precedent for passing of ownership (being full payment of all amounts owing under the Hire Purchase Agreement) has not been fulfilled.

That is the reasoning FNB used in justifying their claim to the assets.

The liquidators through Attorney Moroesi Tau-Thabane wrote a letter to the Master of the High Court onMay 3, 2016 indicating that although the bank is a secured creditor, the interests of the general body of creditors had to be taken into account.

The liquidators submitted a bid to halt FNB’s claim to recover their losses at the expense of the other creditors.

On May 10, 2016 the Master made a ruling stating that the assets in question were infact the property of FNB rather than estate assets as claimed by the liquidators, hence FNB was at liberty to dispose them as it saw fit.

It is against this backdrop that the liquidators approached the Commercial Court to review the decision of the Master and set it aside.

The case is before Justice Molete.

MMatsau& Co. represent the liquidators while Mr Mathe and Mr Phafane represent FNB and Mr Sekati appears on behalf of the Master and Attorney General.

 

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