The High Court in Blantyre has granted Prime Insurance Company Limited and Goss Katoki Mwalilino a leave for commencement of committal proceedings for contempt of court against Reserve Bank of Malawi (RBM) Governor, Charles Chuka.
Prime Insurance and RBM are already in a court battle over the Central Bank’s decision to take over management of the insurance company for its alleged failure to settle clients’ claims.
According to the documents at the High Court Principal Registry, Prime Insurance and Mwalilino want Chuka, in his capacity as Registrar of Financial Institutions, imprisoned on grounds that he willfully failed to comply with the order that the court made on June 5 this year.
The injunction that Prime Insurance and Mwalilino obtained restrained the Registrar of Financial Institutions by himself, his agents or his servants from proceeding with the statutory management of Prime Insurance and stopped any decision that Chuka made on June 3.
Arguments in support of contempt proceedings show that in spite of the due notice of the said court order Chuka wrongfully continued from June 3 to July 5, or thereabout, to publish notices on the RBM website informing the general public that Prime Insurance is under statutory management.
Prime Insurance indicates that in view of the notices on the bank’s website, the general public was advised not to transact insurance business with any of the company’s employee, agent or shareholder.
The website is also said to have indicated that all inquiries concerning Prime Insurance shall be handled by the Director of Pension and Insurance Supervision at the RBM.
The RBM Governor is also accused of advising the general public that all transactions that Prime Insurance branches and agencies handled, must be forwarded to RBM’s Blantyre and Mzuzu branches.
Chuka is also said to have failed to publish subsequent notices indicating that the High Court stayed and restrained him from proceeding with the proclaimed statutory management.
“Upon hearing the counsel for the applicants and upon reading the affidavit verifying facts and considering the facts contained in the statement herein, it is this day ordered and directed that the applicants do have leave which is hereby granted for the commencement of committal proceedings for the contempt of court against Mr Charles S.R. Chuka being the current Registrar of Financial Institutions, the respondent herein,’ reads the order that the Assistant Registrar of the High Court signed on July 5.
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