STANDARD CHARTERED BANK ZIMBABWE LIMITED

v

CHINA SHOUGANG INTERNATIONAL

SUPREME COURT OF ZIMBABWE

ZIYAMBI JA, GARWE JA & HLATSWAYO JA

HARARE, JULY 15 & October 11, 2013

AP De Bourbon, for the appellant

T C Masawi, for the respondent

ZIYAMBI JA: Standard Chartered Bank Zimbabwe (“the appellant”) or (“the bank”) is a commercial bank registered and operating in Zimbabwe.  The respondent is a company duly incorporated in terms of the laws of Zimbabwe and was carrying on business in Redcliff, Zimbabwe.  It is a foreign investor whose specific purpose was the refurbishment of the blast furnaces of a Zimbabwean steel manufacturing company popularly known as Zisco Steel.  In October 2007, the respondent held two accounts with the Kwekwe branch of the appellant.  As at 9 October 2007, there was, in the two accounts, an aggregate credit balance of US$47 739.86.

In terms of a directive issued by the Reserve Bank of Zimbabwe (sometimes referred to herein as “the RBZ”) sometime in October 2007, the appellant transferred, to the RBZ, the total credit balance of US$47 739.86  from  the two accounts.  The directive does not form part of the record but it is common cause that it was purportedly issued in terms of s 35 (1) of the Exchange Control Regulations 1996 SI 109 of 1996 (“the Regulations”). When the respondent demanded payment to it of the monies deposited in the accounts, the bank refused to repay.  It claimed that the intervention of the RBZ had rendered it impossible for it to comply with its contractual obligation to make payment to the respondent.

The respondent applied to the High Court for an order compelling payment.  It alleged that the monies were wrongfully and unlawfully debited from its account without its consent and approval.  It claimed that in terms of the law of banking, the bank was contractually bound to repay the credit balances on demand.