PROMINENT businessman Phillip Chiyangwa has been taken to court on allegations of failing to pay back a $4 million loan he got from financially-troubled Interfin Bank.
The summons, which were issued by the bank on Wednesday under case number HC7810/15 — citing Pinnacle Properties Holding, Chiyangwa and Native Investment Africa as defendants — were served by the Sheriff of the High Court through the bank’s lawyer Antony Chagonda.
According to the summons, Chiyangwa owes the bank a total of $4 060 110, which includes a capital credit of $2 million plus interest of $2 million and bank charges amounting to $60 110.
The bank claims sometime in April 2011, it extended a credit facility of $2 million to Pinnacle Properties Holdings.
“Under the credit facility, plaintiff (Interfin Bank) disbursed to first defendant (Pinnacle Properties Holdings) a total capital of $2 000 000. Plaintiff charged total interest of $2 000 000, and bank charges of $60 110, thereby producing a total payable amount of $4 060 110,” the bank said.
“First defendant defaulted on making due and punctual payment under the agreement and has not paid anything towards liquidation of the debt and the total outstanding amount under the agreement is $4 060 110. The first defendant acknowledged liability of the outstanding amount on the 9th of September 2013.”
The bank added: “It was a term of the agreement that interest remaining unpaid on the due date shall be added to the capital amount and shall earn further interest as if it was part of the capital amount. Further, any repayments made would first be appropriated towards interest and residue towards capital.”
The bank is also seeking an order compelling Chiyangwa to pay legal costs after having agreed with the bank to cover such costs in the event of him defaulting.
“It was a term of the agreement that in the event of plaintiff instituting legal proceedings against first defendant for recovery of any monies due thereunder, first defendant would be obliged to re-imburse to plaintiff all legal costs incurred including those on a legal practitioners and client scale and collection commission,” the bank said.