Swash Bizo
Senior Member
- Jan 29, 2011
- 141
- 93
[h=2] PSPF likely to lose 50bn/- in building lease dispute[/h]
Details Published on Saturday, 17 August 2013 02:30 Written by FAUSTINE KAPAMA Hits: 304
THE Public Service Pensions Fund (PSPF) is at risk of suffering a loss of 50bn/- following admission of liability by a party to proceedings in a land case pending before the High Court over lease agreement dispute involving Quality Plaza Building. One of the parties to the case, Yona Malundo who is also one of the defendants and the alleged appointed liquidator of Quality Plaza Limited, has admitted in his defence documents some of allegations by Quality Group Limited involving payments of 30m US dollars (about 48bn/-) as general damages. The company claims the amount for what is claimed to be severe loss and great inconvenience, loss of business and reputation, as a result of the defendants move to issue a notice for termination of lease agreement in the building. It is claimed that in November 2004, Quality Group Limited sold its shares in a company Quality Plaza Limited to PSPF for approximate 35bn/- . The sole asset which Quality Plaza Limited owned was Quality Plaza building situated on Plot Number 189/2 along Nyerere Road in Dar es Salaam. The deal was received with criticism for having been suspected that it had been grossly overvalued. One of the terms of the deal was for Quality Group Limited to guarantee full occupation of the whole building up to 2010. As a result, the company and its subsidiaries leased a large part of the building which had no tenants and would give up the leased area once a tenant was found by PSPF. It is alleged that Quality Group Limited defaulted paying rent fees and by 2011, it owed PSPF an approximate of 7bn/-. In 2010, the PSPF decided to liquidate Quality Plaza Limited for the purpose of transferring the building to its own name and appointed Mr Malundo as its accountant for the purpose. It is claimed further that the appointment of the accountant did not follow the laid down procurement procedures. Court documents show that in February last year, various lease agreements expired, but a dispute between the PSPF and Quality Plaza Limited arose after the latter attempted to remove partitions and other fixtures which, according to PSPF claims, were part of the building as per sale agreement. On June 1, last year, Quality Group Limited filed a suit against Mr Malundo, Board of Trustees of PSPF, Quality Plaza Limited and Image Properties and Estate Limited, demanding 30m US dollars damages and some declaratory orders that the notice for termination of the lease agreement was null and void. The defendants filed a joint written statement of defence on June 27, last year, requesting the court to dismiss the suit with costs and raised a counter claim against Quality Group Limited for payment of 4,338,685 US dollars and order for eviction from the building. However, in a surprising move, Mr Malundo and Quality Plaza Limited, on July 2, last year, filed a separate joint written statement of defence and, among others, admitted the contents, notably of paragraphs 37 and 38 of the plaint lodged by Quality Group Limited in its totality, Mr Malundo, nevertheless, was quick to point out that he shall not be liable to pay the demanded general damages as has done no wrong personally and other defendants were liable for that. In its paragraph 37 of the plaint, Quality Group Limited claims that it would suffer irreparable injury if the defendants would be left to continue operating their activities in a manner they have been doing, leading the company to severe loss and great inconvenience, loss of business and reputation. Furthermore, in its paragraph 38, the company alleges that as a result of the defendants act to issue a termination notice, it has suffered mentally and has been severely harassed and embarrassed and, therefore, shall claim from the defendants 30m US dollars (about 48bn/- ) as general damages. The case has been set for mention before Judge Fredrica Mgaya on September 23, this year.
Details Published on Saturday, 17 August 2013 02:30 Written by FAUSTINE KAPAMA Hits: 304
THE Public Service Pensions Fund (PSPF) is at risk of suffering a loss of 50bn/- following admission of liability by a party to proceedings in a land case pending before the High Court over lease agreement dispute involving Quality Plaza Building. One of the parties to the case, Yona Malundo who is also one of the defendants and the alleged appointed liquidator of Quality Plaza Limited, has admitted in his defence documents some of allegations by Quality Group Limited involving payments of 30m US dollars (about 48bn/-) as general damages. The company claims the amount for what is claimed to be severe loss and great inconvenience, loss of business and reputation, as a result of the defendants move to issue a notice for termination of lease agreement in the building. It is claimed that in November 2004, Quality Group Limited sold its shares in a company Quality Plaza Limited to PSPF for approximate 35bn/- . The sole asset which Quality Plaza Limited owned was Quality Plaza building situated on Plot Number 189/2 along Nyerere Road in Dar es Salaam. The deal was received with criticism for having been suspected that it had been grossly overvalued. One of the terms of the deal was for Quality Group Limited to guarantee full occupation of the whole building up to 2010. As a result, the company and its subsidiaries leased a large part of the building which had no tenants and would give up the leased area once a tenant was found by PSPF. It is alleged that Quality Group Limited defaulted paying rent fees and by 2011, it owed PSPF an approximate of 7bn/-. In 2010, the PSPF decided to liquidate Quality Plaza Limited for the purpose of transferring the building to its own name and appointed Mr Malundo as its accountant for the purpose. It is claimed further that the appointment of the accountant did not follow the laid down procurement procedures. Court documents show that in February last year, various lease agreements expired, but a dispute between the PSPF and Quality Plaza Limited arose after the latter attempted to remove partitions and other fixtures which, according to PSPF claims, were part of the building as per sale agreement. On June 1, last year, Quality Group Limited filed a suit against Mr Malundo, Board of Trustees of PSPF, Quality Plaza Limited and Image Properties and Estate Limited, demanding 30m US dollars damages and some declaratory orders that the notice for termination of the lease agreement was null and void. The defendants filed a joint written statement of defence on June 27, last year, requesting the court to dismiss the suit with costs and raised a counter claim against Quality Group Limited for payment of 4,338,685 US dollars and order for eviction from the building. However, in a surprising move, Mr Malundo and Quality Plaza Limited, on July 2, last year, filed a separate joint written statement of defence and, among others, admitted the contents, notably of paragraphs 37 and 38 of the plaint lodged by Quality Group Limited in its totality, Mr Malundo, nevertheless, was quick to point out that he shall not be liable to pay the demanded general damages as has done no wrong personally and other defendants were liable for that. In its paragraph 37 of the plaint, Quality Group Limited claims that it would suffer irreparable injury if the defendants would be left to continue operating their activities in a manner they have been doing, leading the company to severe loss and great inconvenience, loss of business and reputation. Furthermore, in its paragraph 38, the company alleges that as a result of the defendants act to issue a termination notice, it has suffered mentally and has been severely harassed and embarrassed and, therefore, shall claim from the defendants 30m US dollars (about 48bn/- ) as general damages. The case has been set for mention before Judge Fredrica Mgaya on September 23, this year.