Fidelis Munyoro and Yeukai Karengezeka, Harare B ureau

MINING firm NR Barber has approached the Constitutional Court for permission to challenge the Supreme Court ruling last month which converted United States dollar debts to the Zimbabwe dollar at a rate of 1:1 in line with Statutory Instrument 33 of 2019.

The mining company is basing its challenge on its submission that the statutory instrument was unconstitutional and that it should have been declared unconstitutional at the appeal hearing which overturned a previous High Court ruling that debts in US dollars retained their value in that currency.

The company lost its case last month after Zambezi Gas Private Limited, a mining services provider, successfully appealed to overturn the earlier ruling by the High Court, which was in favour of NR Barber. The Supreme Court found that the statutory instrument made it clear that debts contracted before the statutory instrument were to be converted at 1:1.

NR Barber was owed $3 885 000 plus interest by Zambezi Gas Zimbabwe (Private) Limited since 2014 and at that stage the debt was effectively denominated in US dollars 

In an urgent chamber application NR Barber, which has hired top lawyer Advocate Thabani Mpofu, is seeking leave to appeal the judgment of the Supreme Court delivered on January 20 this year. Alternatively, the company seeks leave to approach the Constitutional Court in terms of section 85(1) of the constitution, challenging the decision of the Supreme Court; that section allows anyone in their own interest, in the interest of someone unable to act for themselves, or in the public interest to appoach “a court” alleging that a fundamental right has been infringed and the court may grant appropriate relief including a declaration of rights and an award of compensation. 

NR Barber is under judicial management. But the company’s judicial manager, Mr Antiock Kurauone, stated in an affidavit that the court’s decision, had an effect of violating the company’s rights.

The mining firm, which is a legal person in terms of the law, contends that the court judgment has an effect of violating its property rights as enshrined under Section 71 of the Constitution of Zimbabwe, the section on property rights in the declaration of rights.

In its request to appeal, NR Barber has submitted that its rights under Section 56(1) of the Constitution guaranteeing a fair hearing were breached as well as its right under the fair hearing provisions in sections 69(2) and 69(3) which go into detail on rights in civil cases and disputes. It argues that the lower court erred in proceeding on a “false basis being that the validity of Statutory Instrument SI33 of 2019 was not challenged and was consequently not an issue before it”.

But Mr Kurauone in his affidavit said the court shoud have considered the statutory instrument and found it void as being promulgated “contrary to provisions of section 2 of the Presidential Powers (Temporary Measures) Act” and then found that the High Court judgement should stand.

SI33 of 2019 abolished the multi-currency regime and reintroduced the Zimbabwe dollar.

Zambezi Gas did not honour its debt despite several court orders against it, until the Government through SI33 made it clear US dollar balances were converted to the RTGS dollar, a new local currency, at the rate of 1:1.

The gas firm paid RTGS$4 136 806.54 into NR Barber’s bank account in May last year saying that was the final settlement of its debt and the interest that had accrued. On the date of payment, the amount was equivalent to just USD$144 788.23 at the interbank rate.

This prompted NR Barber to seek to attach Zambezi Gas’ property leading to the latter approaching the High Court, seeking a declaration that it had fully met NR Barber’s debt. The High Court ruled in favour of NR Barber, stating that debts contracted in US dollars would continue to hold the US dollar value. 

Zambezi Gas immediately appealed against the decision at the Supreme Court, which overturned the High Court decision in favour of Zambezi Gas.