Court dismisses Msungama appeal over ‘unclean hands’, ordered to pay back Chacha with legal costs

Malawi Supreme Court on Friday January 29 2021 dismissed an appeal by  Lilongwe-based  businessperson Mike Msungama  Phiri seeking  a stay of execution of judgment  by the High Court ordering him to pay back in full loan of  $47 200  he took from United States-based Malawian entrepreneur  Chawezi  Sibongile Banda, daughter of Malawi’s former Finance Minister, the late Aleke Kadonaphani  Banda, well known as ‘Chacha’.

Chacha dragged Msungama to court in May 2020, arguing that while the legal contract having specifically agreed repayment terms, Msungama defaulted payment any sum towards settlement of the debt.

Msungama used the money to purchase a vehicle on December 25 2019.

On 15 September 2020 High Court commercial division judge Annabel Mtalimanja ordered Msungama  to pay the debt in full.

But Msungama with his lawyer Edgar Kachale sought a relief from Supreme Court of Appeal to grant a stay of execution of judgment pending an appeal.

As a respondent, Chacha through her prominent private practice lawyer Mtchuka George Mwale, successfully opposed the application for a stay of execution, arguing that Msungama used the proceeds of the loan to purchase a Ford Everest from South Africa.

Lawyer Mwale asserted that after the sale of Ford Everest, Msungama then purchased a Toyota Fortuner but dismissed the assertion that  it was stuck in South Africa.

He argued that this is questionable because upon the close scrutiny of the change of ownership vehicle document- it was registered in 27 October 2016 as was confirmed with the Road Traffic Directorate and it was surprising to note that Msungama claimed that the car was stuck in South Africa and that it was purchased in 2020.

Mtchuka Mwale continued to assert that Msungama’s application was founded on “inconsistencies” intended to mislead the court and also “contemptuous” in a manner that amount to lying under oath.

It was asserted that Msungama has perjured himself (lying under oath) and intended to abuse the court process.

In his determination, Justice Frank Kapanda pointed out that Msungama was only seeking for the court’s intervention for something that is temporary and that he admitted to owe Chacha the sum of $47 2000.

Justice Kapanda said the Supreme Court of Appeal would not aid Msungama in “delaying the inevitable”, saying Chacha is entitled to be paid back the money.

He said the High Court rightly found that Msungama failed to disclose to the court his real financial position and he was not granted the equitable relief.

As if that was not enough,  pointed Kapanda, Msungama was seeking another equitable relief from the Supreme Court with “no clean hands by suppressing material facts.”

The Supreme Court of Appeal agreed with Chacha’s lawyer that Msungama was not deserving of the exercise of the court’s discretion as he was not coming to seek justice with clean hands.

“The hands of the Appellant [Msungama] are not clean as he attempted to mislead the Court by stating that he purchased the purported  Toyota Fortuner with proceeds from the sale of the Ford Everest. There is evidence undoubtedly showing that the ownership of the said vehicle was registered on 27 October  2016 as was confirmed by the Rod Traffic,” said Kapanda in his ruling.

Furthermore, Justice Kapanda pointed out that there is no subject matter worth preserving  where Msungama himself attempts to mislead the court in granting him an equitable relief.

“More significantly, this court is inclined to weigh this against the success of a litigant who should not be deprived of the fruits of his or her judgement.

“This court ultimately finds that the ends of justice will be served by refusing to order the stay sought in this application,” said Justice Kapanda.

The Supreme Court  ruled – he who comes into equity must come with clean hands –  and dismissed Msungama’s application with legal costs.

Msungama is known as the first person to be convicted in relation to Cashgate, the biggest financial scandal in the country’s history.

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