The Central Medical Stores Trust (CMST) has obtained a court order to seize and sell assets for SADM Pharmaceuticals Ltd (SADM) to recover the sum of US$4,3 million (about K7.5 billion).
SADM is owned by Chargé d’Affaires of the Malawian Embassy in Tel Aviv, David Bisnowaty.
Confirming the development, CMST lawyer Pempho Likongwe said they only amount they recovered is MK180,934.74 which from SADM’s bank account after they got a third party debt order.
In 2023, the Malawi Supreme Court of Appeal ordered SADM Pharmaceuticals to pay back a $4.3 million penalty to Central Medical Stores Trust (CMST) for late settlement of a $340 000 (about K595 million) debt.
The nine-judge Supreme Court panel further ordered SADM Pharmaceuticals to honour the judgement within 14 days from yesterday as well as pay costs of the proceedings.
The court has also set aside the summary judgement High Court Commercial Division Judge Ken Manda delivered in June 2020, which ordered CMST to pay the penalty, but allowed SADM to go back to the same court, under a different judge, to file for claims for late settlement of payment.
Since then, SADM has been failing to pay back the penalty.
“By a Summary Judgment delivered by Honourable Justice Manda on 18th June 2020, the High Court Commercial Division ordered CMST to pay SADM the sum of over US$4,3 million as compound interest on the delayed payments. CMST applied for a stay of execution, but it was not granted.
“Therefore, CMST was forced to pay the Malawi Kwacha equivalent of the sum of US$4,3 million to SADM. CMST appealed to the Malawi Supreme Court of Appeal (MSCA). The MSCA delivered its Judgment on 25th May 2023. The MSCA set aside the Summary Judgment and remitted the case back to the High Court Commercial Division to be handled by another Judge.
“The MSCA ordered SADM to pay back to CMST the money that CMST had paid (US$4,3 million ) within 14 days from 25th May 2023. CMST is pursuing SADM to recover this money.
“When SADM failed to pay the money ordered by the MSCA, we followed court processes to sell SADM’s real property. The specific Court Order we have is for the sale of Title Number Alimaunde 29/188, Lilongwe, which houses SADM’s factory. The Sheriff also has a Seizure and Sale Order (Warrant of Execution) to seize SADM’s assets and sell them to recover the sum of US$4,3 million,” said Likongwe
In the 2018/19 financial year, SADM was among many local suppliers owed by CMST due to poor cash flow.
SADM took CMST to court in 2019 for delayed payment of $340 000 after supplying medicines.
