HARARE – A Harare High Court judge has slapped National Building Society (NBS) with a US$10,000 fine for sitting on a US$5 million Treasury Bill it had been ordered to hand back, accusing the lender of treating a binding court order with “disdain”.

Justice Faith Mushure, sitting in the Commercial Division, found the building society in contempt after it refused to transfer the bill to Stratus Capital Partners, even after being served with her September 2025 order directing its return. She also ordered NBS to pay Stratus’ legal costs on the punitive legal practitioner-and-client scale.

At the heart of the dispute is a government-issued Treasury Bill first traded between Stratus and ADC Capital (Private) Limited, which later moved the security to NBS. When the Stratus–ADC sale agreement was terminated, Mushure ordered ADC to return the instrument. Her order expressly reached “any persons holding and/or claiming the Treasury Bill through” ADC.

NBS, later established to be the holder, dug in. It argued it was a stranger to the original proceedings and had acquired the bill in its own right as a holder in due course.

Justice Mushure would have none of it, ruling that the relevant part of the order had an “in rem character” and bound whoever held the bill through ADC.

“The first respondent’s actions prompted the applicant to approach this court on an urgent basis,” the judge said.

She was scathing about what happened next. NBS, she found, knew exactly what was expected of it, but decided the order did not apply to it.

“Reading through the first respondent’s submissions, one can decipher subtle hints of the first respondent treating the court order with disdain,” Mushure said. “That the first respondent could not and cannot do.”

NBS’s reliance on legal advice fared no better. The judge found the building society had made up its mind not to comply before it sought a legal opinion, one that “coincidentally accorded with that view”.

She concluded the refusal was deliberate, and that it “not only demonstrates that it wilfully disobeyed a court order but that it also acted mala fide.”

The court also dismissed NBS’s attempt to shelter behind the Bills of Exchange Act. Treasury Bills, Mushure said, may be negotiable, but they are government debt securities, not bills of exchange. “To the extent that the first respondent relies on the provisions of the Bills of Exchange Act, I find its argument flawed,” she ruled.

Proof of ownership was another weak spot. NBS claimed an official Central Securities Depository record showed it as the holder, yet never put that record before the court.

“Surely, if the transaction was done in good faith and for value, the necessary appropriate entry in a record or account kept by the CSD would have been conclusive proof of the acquisition,” the judge said.

A Memorandum of Agreement involving NBS, ADC Capital and OK Zimbabwe fell apart under scrutiny. It was to take effect only once the last party had signed, but OK Zimbabwe never did. The agreement therefore “did not come into effect”, Mushure found. “In short, there was no contract at all.”

The court further found that ADC transferred the bill to NBS on January 17, 2025, despite later undertaking to Stratus to return it. The judge said the two respondents appeared to have closed ranks to frustrate enforcement.

“What is striking is that both the first respondent and the second respondent seemed to have now joined hands to thwart the applicant’s efforts to enforce the judgment of this Court,” she said. “These efforts seem to me neither accidental nor coincidental but by design.”

The bill carries a maturity value of US$5 million, while its market value during the proceedings was put at between US$2.75 million and US$2.8 million.

Mushure said the court had to vindicate its authority. An order binds all parties until it is lawfully altered or discharged, she stressed, and the alternative would be intolerable.

“If a party could disregard an extant court order because it had adopted an incorrect interpretation of it, obedience to court orders would become optional and the administration of justice would be undermined,” she said.

NBS must pay the US$10 000 fine to the Registrar of the High Court within seven days, along with Stratus’ costs.