One of the country’s leading bread manufacturers, Lobels Bread (Pvt) Ltd, has been taken to the High Court by Grisberg Services (Pvt) Ltd, which is seeking to recover $109 195,66 advanced to the bakery firm as loan, while the latter was fighting liquidity challenges six years ago.
BY CHARLES LAITON
Grisberg Services (Pvt) Ltd, which is cited as the plaintiff in the lawsuit claims sometime in September 2010 the bread manufacturing firm approachedGrisberg Services, seeking a loan in a bid to buy flour from Manyame Milling Company and to pay for bread pans.
“Plaintiff (Grisberg Services) undertook to loan defendant (Lobels Bread) money for the defendant, which was facing liquidity challenges and collapse to achieve the following with the loan: – payment for unlocking flour from Manyame Milling Company, payment to unlock the outstanding supply of bread pans, which the defendant required to run its plant number 9, and payment for or supply of diesel, which defendant required to start production,” Grisberg Services (Pvt) Ltd said.
“Consequent to the agreement, the plaintiff accordingly proceeded to make the following payments to the defendant; $40 000 on September 16, 2010, $9 000 September 17, 2010, $20 000 on the September 21, 2010 and delivery of 904 litres of diesel, equivalent to $9 041.”
Grisberg Services further said in terms of the loan agreement, Lobels Bread, undertook to pay $15 per tonne for every flour supplied from the funds loaned, which amount would compensate Grisberg Services for loss of business and all in all the latter paid a total amount of $78 000.
“The defendant consequent to the agreement proceeded to repay the plaintiff a total of $96 400 between October 10, 2010 and June 7, 2011. However, the amount paid did not cater for all the interest of 10% per month that had accrued,” Grisberg Services said.
“Therefore, due to the interest of 10% per month accruing on amounts loaned the plaintiff as at August 31, 2012 was owed a total amount of $109 195,66 arising from the parties loan agreement.”
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However, Grisberg Services said in May 2012, Lobels Bread entered into a scheme of arrangement with its creditors and, Grisberg Services, proceeded to submit its claim, but was rejected.
“The defendant had no legal justification for having rejected the claim arising from a lawfully entered loan agreement,” Grisberg Services said.
Lobels Bread has since entered an appearance to defend notice.
