High Court freezes Nsanje Council bank account over debts

NSANJE — The High Court of Malawi on Thursday issued an order to Nsanje District Council restricting it from doing any bank transactions through its Malawi Savings Bank Account for failing to pay MK300, 000 debts.

Nsanje District Commissioner, Rodney Simwaka confirmed the development, saying the court order emanated from a wrangle between the council and Trust and Praise, a company that supplied medical equipment to the district hospital about five years ago.

“The High Court served the Council with the garnishee order last Thursday over MK300, 000 debts which the council owes the supplier. We will clear the balance by today, Tuesday,” Simwaka said.

Simwaka explained that the Council failed to pay the creditor in time due to inconsistent cash flow that forced them to borrow some important materials for the smooth running of the Council.

“The Council owed Trust and Praise K2 million and paid all the money except the said balance due to insufficient funds that resulted from unpredictable cash flow and unstable pricing on the market.

“For instance, sometimes we could budget for drugs as per prices at Central Medical Stores (CMS) only to discover that the medication is not available and we could opt for another source with a more slightly expensive price than that of CMS,” said Simwaka.

Explaining on the side effects of the order to their activities, Simwaka said the Council has faced minimal negative effects; saying volume of payments was currently low.

“We haven’t received funds for January and most of the planned activities for December were done therefore the effects are marginal,” he said.

A garnishee order is a court directive instructing a bank that funds held on behalf of a debtor shouldn’t be released until directed by the court.