Former tourism minister ordered to pay CRDB bank Sh184.6 million

Dar es Salaam. Mr Ezekiel Maige, who is a former Natural Resources and Tourism minister, has been ordered to pay CRDB Bank Plc Sh184.6 million over a loan default.

Lady Justice Katarina Mteule of the Commercial Division of the High Court was satisfied that Mr Maige took no necessary steps to defend the suit brought against him.

CRDB sued the former Msalala lawmaker last year after failing to repay part of Sh296.3 million loan he secured from the bank.

According to court documents, the loan was secured by mortgage over plot number 2002, Block E, located at Mbezi Beach, Kinondoni Municipality in Dar es Salaam.

The court heard that after having failed to repay the loan per agreed terms and conditions, Mr Maige made partial payment of Sh100 million and applied for restructuring of the facility.

He applied to the bank and was allowed to pay Sh3 million per month instead of Sh4.7 million. It was agreed under the rescheduled loan letter that Mr Maige would repay the loan facility on the monthly instalment basis at the interest of 18 percent annually through monthly deductions from his account.

The bank alleged that the defendant has failed or refused to adhere to the terms and conditions of the credit facility by not remitting the monthly instalments as agreed such that by August, 2020 the defendant loan account was in arrears of Sh184.6 million.

CRDB also alleged that on several occasions it demanded repayment of the loan with interest from the former minister but failed to heed to the demands. After the case was filed in court, Mr Maige filed his written defence on May 21, 2021.

However, the defence was challenged by the bank which asked the court to strike it out for being filed out to time. The court sided with the bank and struck out the defence.

With Maige’s defence struck out, thus rendering the CRDB claims uncontested, lawyers representing CRDB went ahead to ask the court to enter a default judgment under rule 22 (1) of the High Court (Commercial Division) Procedure Rules.

The rule is categorical that where a party in a case fails to file a written statement of defence within specified period, the court shall enter judgment in favour of the plaintiff.

“It is apparent that the defendant was dully served and that the written statement of defence filed by the defendant was stuck out by the court. It is obvious in law that when a mater is struck out, it is considered as if it has never been there.

“In this respect, the plaint remains uncontested for having no written statement of defence filed to defend that suit. The written statement of defence was struck out on 2/7/2021 and to this moment, the court does not have in record any pending application indicating the defendant’s effort to take necessary steps to refile the defence,” said the judge.

The court ordered Mr Maige to pay the bank Sh184.6 million and all accruing interest at 18 percent and penalties at 3 percent from September 24, 2020 to the date of full payment. CRDB bank will, however, have to publish a summary of the court’s decision in at least two newspapers of wide circulation within ten days from the date of the judgment before it can execute the award.