BANKRUPTCY CAUSE NO. 5 OF 2001
Re Alex Tchongwe, a debtor
FINANCE BANK OF MALAWI LTD......................PETITIONER
CORAM: HON. JUSTICE A.C. CHIPETA
The Petitioner, Finance Bank of Malawi Limited, has presented before
this court a Creditorís Bankruptcy Petition. The Respondent therein
is a Mr Alex Tchongwe, who is said to be the Petitionerís Judgment Debtor.
The petition is verified by an affidavit sworn by a Mr Peter White, Deputy
Managing Director of the Petitioner.
In presenting the petition Mr Chagwamnjira, of Counsel, said that the Respondent owes the petitioning Bank sums of money on basis of which it sued him and obtained judgment. All efforts to recover the judgment debt having yielded nothing for the Bank, Mr Chagwamnjira said that on 8th February, 2001 the Petitioner applied for a Bankruptcy Notice to issue and that the Registrar issued one that same day. This notice, he said, was served both under Order 10 of the Rules of Supreme Court and by substituted service.
Mr Chagwamnjira further argued that the notice required the Respondent to pay K10,797,465.42 within 30 days unless he could satisfy the court that he has a counterclaim, set off or cross-demand equal to or exceeding the sum due. By the expiry of the time limited he said the Respondent had not complied with the requirements of the notice in either of the modes available and that he had thus in terms of Section 3(1)(g) of the Bankruptcy Act (Cap 11:01) committed an act of bankruptcy. This, it was argued, then entitled the Petitioner to the filing of the petition for bankruptcy herein.
As regards Section 7 of the same Act, it was advanced by Mr Chagwamnjira, that here too the Petitioner has complied with all the necessary legal requirements. The debt, he said, has been proved both through the judgment on file and the affidavit spelling out its details. It was thus submitted that the Petitioner has done all that is required if it to obtain a receiving order against the Respondent and that this court should therefore grant such order.
I listened with great care to all the petitioner presented at the hearing of this petition. I have taken time to match all that presentation with the details on the court record as well as the requirements of the law as spelt out under the Bankruptcy Act. It is clear to me that in a case like this it is essential, inter alia, that be satisfied about the existence of a creditor - debtor relationship between the petitioner and the respondent, that the debtor has committed at least one act of bankruptcy prior to the presentation of the petition, and that there has been due service of the petition on the Respondent. (See: Sections 3 and 5 of the Bankruptcy Act).
Similarly the issue of service of petition appears to me to be beyond question in this matter. There is on record an order granted by the Registrar on 23rd April, 2001, with its formal order signed on 25th April, 2001 by the same Registrar, allowing for service of the petition through a single advertisement of the same in the Daily Times and in the Nation newspapers. There is following this an affidavit of service which I accepted unfiled on 11th May, 2001 on undertaking by Counsel that he would duly file it subsequently. This was on the basis of injunction to the effect that the High Court Accounts office was that day not open and that it was thus impossible to pay filing fees. This affidavit is to the effect that service herein was achieved both through the post on 26th April, 2001 per Order 10 R.S.C. and through the authorized advertisement on 1st May, 2001.
Now while I have acknowledged receipt and sight of an affidavit of service in respect of the petition I must confess that I see none on the file in respect of the Bankruptcy Notice. I know whether there was omission to file such affidavit or such was filed and then misplaced. What is clear, however, is that in the form the file was passed on to me from the Civil Registry between the Bankruptcy Notice and the application to serve petition by substituted service there is no affidavit explaining how the Bankruptcy Notice was served. The only word I have on that service is that from learned Counsel during his presentation, but there is no supporting documentary confirmation.
Of the debtor was indeed served in February or March, or April and per Section 3(1)(g) did nothing to settle the debt or to exempt himself from settling it as was open to him as specified in the notice and seven days elapsed from the day of service the petitioner then earned a right to file this petition soon that period elapsed. If, however the debtor was not served then he could not have been in default of compliance with the demands in a notice that he was not aware of and to say that he then committed an act of bankruptcy would not be true. The position I find myself in is that much as I would be happy to accept the word of Counsel as word of honour, in the absence of affidavit of service to buttress that word I cannot positively conclude that the Respondent has in this matter committed the act of bankruptcy as complained of herein. The rules require an affidavit for proof of service and here there is none vis a vis the notice (See Rules 103 and 116 of the Bankruptcy Rules).
In this case therefore much as I am amply satisfied about the debt the respondent owes the petitioning creditor, and that in line with the Registrarís Order the respondent was duly served with the petition herein, I entertain reasonable doubts as regards proof of the act of bankruptcy alleged as it is not quite plain if and when the Bankruptcy Notice allegedly disregarded by the Respondent was served, if at all. Section 7(3) of the Bankruptcy Act in these circumstances directs me to dismiss the petition, which I do. As the Respondent did not even attend, I need not award him any costs. I thus make no order on costs.
Made in Chambers the 14th day of May, 2001 at Blantyre.