DBZ sues Findlay over $2 million loan

DBZ sues  Findlay over $2 million loan

DBZ SUES FINDLAY, SEEKS TO GRAB HIS PROPERTY

By GRACE CHAILE LESOETSA

LUSAKA businessman Harry Valden Findlay has been sued in the Lusaka High Court by the Development Bank of Zambia (DBZ) over an unpaid loan facility given to Chrismar Hotel five years ago in the sum of about US$2 million.

But Mr Findlay has disputed owing US$1, 905, 846.42 nor being in breach of the repayment of the long-term facility.

He stated that the hotel has so far paid US$1, 640, 566.74 towards the loan facility which expires on November 22, 2023.

DBZ which is demanding interest, stated that as at October 25, 2021, Chrismar owed US$1, 905, 846.42.

It is also claiming delivery of the mortgaged property, stand no.4035 in Livingstone. DBZ seeks foreclosure and sale of the mortgaged property.

Chrismar, Mr Findlay, the hotel’s Chief Executive Officer and Osanna Lydia Findlay Peters are sued as first, second and third respondents respectively.

According to documents filed in the Lusaka High Court commercial registry, Chrismar entered into a long term loan agreement with DBZ dated April 18, 2016 with Mr Findlay and Ms Peters as guarantors.

It stated that the first respondent got the loan to finance completion of works on the 40 additional rooms under construction at the hotel in Livingstone to expand it to 99 rooms.
The same money would be used for renovation of the existing 47 rooms at the hotel in Lusaka, purchase and installation of a new generator set and buying eight utility motor vehicles for purposes of operations at the two hotels.
DBZ stated that the loan facility had a grace period of 12 months on principal repayments effective from the date of first draw-down, while interest repayments had no grace period and were due and payable monthly.

“The first respondent has failed or neglected to make payments as agreed and is therefore in default in terms of clause 12 of the facility letter.
In view of the said provisions of the default clause under the facility letter, the applicant is entitled to recall the loan and demand full payment of both the principal and interest now due and owing from the first respondent to the applicant,” stated DBZ.

But in an affidavit in opposition, Mr Findlay, did not dispute the loan facility and stated that it was repayable in 72 monthly instalments, effective of the 12 months grace period, which grace period was agreed would commence from the date of the first draw-down.

He stated that the company paid the bank an upfront appraisal fee of US$20, 000 on April 8, 2016 but did not receive the US$2m immediately upon execution of the said long term loan facility.

“That I verily believe that after much back-and-forth communication, the applicant eventually made a portion of the long-term facility loan available to the first respondent, the first which was drawn down on or about November 22, 2016 when the first respondent did draw the sum of US$450, 000,” he stated.

According to Mr Findlay, the company made payments in 2017 and 2018 in a total sum of US$138, 415.

He stated that DBZ was engaged that the global pandemic crisis had seriously affected the hotel’s business bringing the operations to a halt, therefore faced difficulties in repaying the loan.
“That I verily believe that the first respondent is not in breach of the long term loan facility entered into between the parties, which only expires on or about November 22, 2023 and which makes no reference to any specific monthly instalment that the first respondent ought to remit, instead what is evident is that despite the economic conditions caused by Covid-19, the first respondent has continued to make payments to the applicant under foreside facility which payments have to date amounted to US$1, 640,566,” Mr Findlay stated.

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