The High Court of Zimbabwe has fined National Building Society (NBS) US$10,000 for contempt of court. The bank was found guilty of wilfully disobeying a court order to surrender a US$5 million Treasury Bill to Stratus Capital Partners. The Treasury Bill, issued by the government, had a face value of US$5 million and was dated December 2023, maturing on December 28, 2026.
According to the court judgment, NBS initially claimed it did not hold the security through ADC Capital or another party and stated that it had already settled the instrument. However, after being asked for clarification, the bank confirmed that it possessed the Treasury Bill. The Sheriff attempted to enforce the order against the bank on October 22, 2025, but NBS allegedly refused to transfer the security.
The dispute began with a September 2025 judgment obtained by Stratus Capital Partners against ADC Capital, which terminated the sale of the Treasury Bill and confirmed Stratus Capital's right to recover it. The court ordered ADC Capital and anyone holding or claiming the security through the company to transfer it to Stratus Capital's account within seven days. NBS argued that it had acquired the Treasury Bill in its own right, for value and without knowledge of any defect in the previous holder's title.
NBS claimed it had acquired the Treasury Bill at a 55% discount before it was transferred to the bank on January 17, 2025. The bank said it later liquidated the security and credited accounts linked to OK Zimbabwe and Kenge Foods as part of an invoice-discounting facility. However, the court rejected NBS's defence, finding that although a Treasury Bill is a negotiable financial instrument, it is a government debt security issued under the Public Debt Management Act and not a bill of exchange.
The court also questioned documents presented by NBS in support of its ownership claim, including an incomplete memorandum of agreement involving NBS, ADC Capital, and OK Zimbabwe. The agreement provided for the liquidation of US$5 million in Treasury Bills at a 55% discount to settle OK Zimbabwe's invoice-discounting exposure, with ADC Capital expected to repurchase the securities. However, OK Zimbabwe had not signed the agreement, and the court found that the conditions required for it to take effect had not been fulfilled.
Justice Mushure concluded that NBS had failed to substantiate its ownership claim and was, at best, holding or claiming the Treasury Bill through ADC Capital. The judge found that NBS had been served with the earlier court order but had deliberately failed to comply with it. The bank's refusal was found to be wilful and in bad faith. NBS was ordered to pay a US$10,000 fine, or its equivalent in Zimbabwe Gold, to the Registrar of the High Court within seven days.
The institution must also pay Stratus Capital's legal costs, including enforcement costs, on a legal practitioner-and-client scale. Justice Mushure declined to issue further orders expanding or clarifying the original judgment, saying contempt proceedings were intended to compel compliance with an existing order.
Key points
- National Building Society was fined US$10,000 for contempt of court.
- The bank refused to surrender a US$5 million Treasury Bill to Stratus Capital Partners.
- The court rejected NBS's defence, finding that it had failed to substantiate its ownership claim.
