Monday, August 15, 2022

Registrar of Deeds/DPP to initiate criminal investigations against BBS

The Registrar of Deeds is expected to ask the Department of Public Prosecution (DPP) to investigate and prosecute the Botswana Building Society, its lawyers and deputy sheriffs for committing “a criminal offence” in the transfer of a property title.

This follows this week’s letter by lawyers acting for Southern African Furniture Manufactures (SAFCO), an aggrieved BBS customer, asking the Registrar of Deeds to refer to the DPP “for possible investigation and criminal prosecution” the transfer of their client’s lot, “the circumstances surrounding the transfer and indeed the documentation prepared in relation to the transfer”.

The case, which threatens to open a can of worms, follows a long running dispute between BBS, its lawyers and the aggrieved client SAFCO in which allegations of impropriety, misconduct and possible corruption are flying thick and fast.

At the time of going to press, the High Court in Lobatse had issued an order reversing the transfer of the disputed property back to SAFCO, following arguments that the transfer was “illegal” and “unlawful”.

Justice Maruping Dibotelo, who issued the order, said “in my judgement there is, in this case, a litany of instances of non-compliance with the mandatory provisions” of the High Court regarding procedures to be followed when selling immovable property under the hammer.

It emerged during the court proceedings that the SAFCO factory shell, which was attached by BBS, was valued at more than P5 million with a forced sale value of P3, 9 million. Although part of the conditions of the sale in execution placed the reserve sale of the property at P3, 9 million, which was the forced sale value, the deputy sheriff went and sold the property for P 3, 1 million. Justice Dibotelo stated that “the fact that a judgement debtor is indebted to a judgement creditor does not authorise the debtor’s property to be sold for a song or at a giveaway price”.

The court mandatory provisions state that the conditions of sale in the case of a sale in execution of a court order should be prepared by the execution creditor not less than 28 days before the sale. It, however, emerged that the conditions were hastily put together two days before the sale and not by the execution creditor. Justice Dibotelo states “in this case the conditions of sale were not prepared by the execution creditor, instead they were prepared by someone else not less than 28 days before the date of sale; they were, in fact, prepared some two days before the date of sale”.

Justice Dibotelo dismissed the evidence by two BBS witnesses saying “I have no doubt that these were concocted stories by these two witnesses designed to cover up what was clearly an impeachable sale in execution”.

The judge further stated that the evidence by a forensic expert “who examined documents pertaining to the sale that, in his opinion, the sale was not an arm’s length commercial transaction” is virtually unchallenged”.

He said the uncontradicted evidence of the forensic expert “in sum is to the effect that the deputy sheriff flouted the conditions of sale so much so that the sale in execution was liable to be set aside”.

It further emerged that conditions stating the date on which the buyer would pay the auctioneers charges and the deposit were breached.

It also emerged that the deputy sheriff lied about making the sale because the court documents revealed that more than 10 days after the said sale in execution, the deputy sheriff was in communication with another interested buyer offering him the property at P3, 3 million.

“Why, if the property had been sold at the auction sale on 13th May 2005 attempts were still being made to sell it to another person on 25th May 2005. This again demonstrates that the sale of 13th May 2005 was very irregular and is liable to be set aside,” stated the judge.

Although BBS and the deputy sheriff claim that the disputed property was sold at an auction sale of 13th May 2005, the transfer duty receipts filed with the Registrar of Deeds states that the property was acquired by private treaty. Justice Dibotelo says “this is again one of the instances” where BBS “failed to rise up and testify or to test its veracity. At least one would have expected that the Attorneys of the applicant (Modimo and Associates) who prepared the documents would have taken the stand to explain why, if the property was acquired at the public auction, the transfer duty receipts stated that it was acquired by private treaty. In the absence of any such explanation I accept the applicant’s argument that this is one of the many instances that show that the sale was riddled with irregularities which must be held to have rendered it invalid”.

According to the court records, the Sherriff went on to sell the SAFCO property although the company had been placed under judicial management. The court had ordered that … “whilst the judicial management order (whether provisional or final) is in force, all actions and executions of all writs, summons and processes against the company be stayed and not proceeded with without leave of the court first having been obtained.

The judge said the Deputy Sheriff effected the transfer “with full knowledge of the judicial management order which prohibited the transfer without leave of the court, I find as a fact that he was in contempt of court and ought therefore to be committed to prison”.

The deputy sheriff was, however, let off with a warning because the court took pity on him as he had already lost his job as a deputy sheriff.

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