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Newsunplug Kenya > Blog > Entertainment > Court orders Harmonize to pay Ksh5.4 million for defaulting bank loan
Entertainment

Court orders Harmonize to pay Ksh5.4 million for defaulting bank loan

new5nuke
Last updated: August 20, 2024 7:03 am
new5nuke
12 months ago
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Bongo flava star Rajabu Abdukahali Ibrahim famously known by his moniker Harmonize, has been ordered by the Tanzanian High Court to pay CRDB Bank Tsh113,185,755.16 (Ksh5.4 million) after he defaulted on a loan.

In Commercial Case No 151/2023, the judge entered a default judgment in favor of the bank after the singer failed to honor the summons to appear in court several times and also failed to submit his written defense statements.

In the judgment seen by Nairobi News, Judge Cleophas K Morris, noted that he had examined all the evidence in the affidavit presented before him and found the musician at fault.

“I also hold that the material facts of this suit plus evidence in the affidavit stand uncontested. This court hereby enters the default judgment in favor of the plaintiff as follows:
(a) The defendant is ordered to pay the plaintiff Tshs103,185,755.16/=
(b) The defendant is hereby ordered to pay the plaintiff interest on the outstanding amount at the rate of 18% per annum from the date of default to the date of this judgment.
(c) The defendant shall pay 7% interest on the decretal sum from the date of this judgment to the date of full payment.
(d) The plaintiff is entitled to Tsh 10,000,000/= general damages from the defendant.”

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According to court papers, the bank on 10th October 2019 offered Harmonize the defendant two credit facilities to the tune of Tsh300 million (Ksh14.2 million) with each loan of Tsh100 million and Tsh200 million separately attracting an interest rate of 18 percent per annum.

Harmonize was to repay the two loans within three years based on equal monthly installments.

“The purpose of the facilities was to finance costs for defendant’s music equipment, establishment of productions studio, music production and promotion. The facilities were secured by a letter of lien over the designated account that was supposed to be opened and maintained by the borrower for an amount of Tsh100,000,000,” CRDB Bank stated in court papers.

The creditor laid out a further set of conditions

“The defendant was among other conditions, required to channel all his business proceeds through the subject account stated above,” The creditor added.

According to CRDB Bank, besides Harmonize failing to comply with the terms and conditions of the loan, he did not repay the loan in full hence the suit ensued.

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CRDB Bank filed the case on 6th December 2023 and the court issued summonses to Harmonize for appearance on 8th December 2023 and filling of his written statement of defense (WSD) on 14th December 2023 respectively.

“The defendant however neither entered appearance in court nor did he file the WSD,” the court papers state.

Another summons was issued by the court on 4th March 2024 requiring Harmonize to file his written defense statement and attend the first pre-trial conference thereafter.

“Once again the defendant neither filed his rewritten statement of defense nor did he appear in court. Over again the court issued another order of reservice on 12th June, 2024.

However, this time the plaintiff was ordered to serve the defendant with the summons by way of publication via Mwananchi Newspapers. Yet again the defendant never filed his defense. He did not enter an appearance in court on the scheduled date,”

According to the creditor, Harmonize had been repaying the loan before defaulting. He would then request the bank for the monthly installment repayment schedule to be reduced from Tsh10,874,567.83 to Tsh3,300,050 which the creditor obliged. Harmonize continued with the new repayment schedule but at some point defaulted again.

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