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Supreme Court Quashes High Court Ruling Ordering NSSA To Pay Molai US$22 million

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By Mary Taruvinga


THE Supreme Court has reversed a High Court judgement forcing the National Social Security Authority (NSSA) to pay US$22 million to tycoon Adam Molai’s Housing Corporation of Zimbabwe (HCZ) for breach of contract.

In an ex-tempore ruling granted Monday, Supreme Court judges Justices Susan Mavangira, Tendai Uchena and Felistus Chatukuta dismissed the lower court’s ruling and ordered that NSSA did not have to compensate HCZ.

Advocate Thabani Mpofu who was representing NSSA confirmed the development.

Last year, High Court judge Justice Paul Musithu had ordered that NSSA pays HCZ whose representatives include Molai and Stephen Duggan and Aleck Nyatanga.

Mpofu said, “The Supreme Court has set aside with costs the judgment of the High Court by Justice Paul Musithu which enforced an arbitration award requiring NSSA to pay Housing Corporation Zimbabwe (Adam Molai) US$ 22 million.

“This was in addition to US$16 million which NSSA has already paid to HCZ. NSSA and HCZ had concluded a Housing Offtake agreement which required HCZ to make available to NSSA 8000 housing units at US$38 000 per unit.”

NSSA entered into a contract agreement with HCZ back in 2017.

Parties agreed HCZ would build 8 000 houses in Caledonia, with a unit cost of US$8 000.

HCZ was also to furnish NSSA with an unconditional performance bond worth US$16 million which would be channelled towards the purchase price of the housing units.

But parties had a fallout when NSSA wrote a letter of demand to Zimnat accusing HCZ of failing to deliver on its end of the deal.

Prior to that HCZ had sued NSSA for repudiation of contract before independent arbitrator, Peter Lloyd who had ruled in HCZ’s favour and ordered that the pension manager compensate the property developer $22 million.

Dissatisfied with the outcome, NSSA had filed an application at the High Court seeking to stop the registration of the arbitration award.

The pension fund argued that the company should not be given the arbitration award as it had swindled the public pension fund of $16 million.

It had also accused HCZ of failing to deliver any completed housing units as required in terms of the agreement.

Musithu had blocked the application and noted that NSSA had failed to demonstrate that the award was against public policy.

This had prompted NSSA to file the present appeal at the Supreme Court.