ZCDC barred from selling Mbada diamonds

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THE Supreme Court has thrown out the Zimbabwe Consolidated Diamond Company (ZCDC)’s appeal against an order barring the government-owned firm from disposing Mbada Diamonds’ diamonds in Chiadzwa.

The order barring the sale of the diamonds came after ZCDC filed an appeal challenging High Court judge Tawanda Chitapi’s ruling, which directed the company to stop selling the diamonds, which belong to Grandwell, a 50 percent shareholder in Mbada.

Mbada’s lawyer Thembinkosi Magwaliba confirmed the Supreme Court ruling yesterday.

“The ZCDC appeal was dismissed with costs. The High Court issued a judgment interdicting the sale of diamonds by ZCDC. The Supreme Court said the High Court was right in interdicting the sale of the diamonds,” Magwaliba said.

Litigation between the parties arose in February 2016 when then Mines minister Walter Chidakwa cancelled operations of all companies that were conducting operations under the special grants in the Chiadzwa diamond fields, including Mbada.

Mbada went on to win a number of court cases including its bid to return to the mining fields.
In its appeal, ZCDC however, challenged Chitapi’s ruling, claiming he misdirected himself by handing down a judgment in Grandwell’s favour and barring the sale of the diamonds.

“The court a quo erred at law and grossly misdirected itself when it granted on an urgent basis an order which has the effect of holding the appellant (ZCDC, in the Supreme Court appeal) in contempt of court, when it was clear that no contempt of court proceedings had been launched by the first respondent (Grandwell) in terms of Rule 388 of the High Court Rules, 1971,” ZCDC argued.

Mbada had however, challenged the appeal, saying ZCDC was not entitled to sell the diamonds, which were a subject of a dispute.

“There is no necessity to sell diamonds from the concession area in respect of which there are disputes,” Grandwell chairperson David Kassel said in an affidavit.

“The terms on which the diamonds are being purchased are unknown. The quality of the diamonds being sold is unknown.

“The buyers are unknown. The whole process is opaque and conducive to corruption …

“The first respondent (ZCDC) is an entity which has no capacity to compensate the applicant (Grandwell) and the second respondent (Mbada). It was unlawfully incorporated as a vehicle for joint ventures between the Government of Zimbabwe and private companies.

“The constitutional framework for joint ventures of that nature was not observed,” Grandwell said.

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