Seretse seeks P50m, court orders State to pay

Mpho Mokwape | Tuesday April 22, 2025 12:29

In a judgment issued on April 16, 2025, Gaborone High Court judge, Michael Leburu, ruled that Seretse and his companies, Khulaco (Pty) Ltd and M&B Properties (Pty) Ltd, have made out a case that interest accrued from the said restrained funds is payable to them and not to the Receiver like the State had argued. 'In the final analysis, once the restrained property is released to its owner, or lawful holder, any interest accrued whilst the property was still under attachment, pending finalisation of the civil forfeiture application by the court, is payable and returnable to the owner of the property or to the person from whom the said property was taken from,' stated Leburu. The judgment comes after the three applicants, Khulaco, M&B Properties, and Seretse filed Notice of Motion seeking about P50 million from interest accumulated from the restrained funds.

In Seretse's founding affidavit as the director and controlling mind of the two companies he sought a number of prayers. He is seeking that the respondents (one being the Attorney General) be declared to have preserved the value of the money that was seized and held by them from the applicants, the respondents be ordered to pay to the applicants the sum of P50,293,738.10; and the respondents ordered to pay to the applicants' interest on the sum at the rate of 10% per annum, and lastly the costs of the suit on attorney and own client scale. Justice Leburu agreed with the applicants that in keeping with the primary prescripts of the Proceeds and Instruments of Crime Act (PICA), if an interim restraining order is ultimately discharged, the restrained property reverts to its owner or from whom the property was seized from. The judge stated that this was in sync with Section 8 of the Constitution, which guarantees the right to property and any interest or profit generated by the restrained property is the property of the owner of the restrained property or the lawful holder of such property. 'If the Legislature, in its usual wisdom, had intended that any interest generated from restrained funds, which are subsequently released to the owner, is to be forfeited to the State, such clear expression could have been espoused in the PICA. It is only the forfeited property, in terms of Section 29 of the PICA, that vests in the Government,' he explained.

Leburu further explained that the court was fully alert to Section 8 of the Constitution which protects and guarantees protection from deprivation of property and that the respondent has not denied that upon the discharge of the restraining order, the said funds were returned to the three applicants herein, less interest accrued from the restrained funds. He stated that the respondent has also argued that the restrained funds belonged to government and that it was baffling as to how an owner of property can bring a civil forfeiture application before the High Court, and ask that its property should be forfeited under the PICA. 'The two questions posed above portray the fallacy of the Respondent's submission on the ownership of the restrained funds. One moment, it is submitted that the funds belonged to the bank and the next opportune moment, it is argued that the funds belonged to government. Such approbating and reprobating is clear indication that the said submissions are not merit-laden,' Leburu concluded. Consequently he made the following orders; that (a) Interest accrued from P69,734,260 from December 13, 2017, up to and including April 29, 2022, shall be payable to Khulaco (Pty) Ltd; (b) Interest accrued from P11,081,016 from December 13, 2017, up to and including April 29, 2022, shall be payable to M&B Properties (Pty) Ltd; (c) Interest accrued from P814,000 from December 13, 2017, up to and including April 29, 2022, shall be payable to Bakang Seretse; (d) the amounts determined at paragraphs (a), (b), and (c) above shall be payable with interest, at 10% per annum, from April 30, 2022, to date of full payment; (e) The computation of the aforestated interest is referred to the Registrar; and (f) The respondent shall bear the costs of the application.

Meanwhile, the court papers stated in length the applicants and the respondents' cases with regards to the restrained funds and the interest accrued thereof. The applicants' case According to Seretse, on December 13, 2017, the following sums of money were placed underrestraint, pending the determination by the High Court of a civil forfeiture application made by the Directorate of Public Prosecution (DPP): P69,734,260 belonging to Khulaco, P11,081,016 belonging to M&B Properties P750,000 belonging to Leomog Investments and P814,000 belonging to him. On August 12, 2021, the High Court delivered judgment on the in rem civil forfeiture application and the application was dismissed on the ground that the DPP had failed to prove, on a balance of probabilities that the funds alluded to above were proceeds of a serious criminal activity. 'The High Court ordered the discharge of the restraint funds. Dissatisfied with the said decision, the DPP appealed to the Court of Appeal. The Court of Appeal dismissed the appeal on the April 29, 2022, and reaffirmed that the State had failed to prove that the said funds were proceeds of a crime,' read the court papers. And in turn an order confirming the discharge of the restraining order therefore ensued. Seretse averred that during these legal skirmishes, the restraint funds were kept and held in a bank account, which accrued interest, from the date of the restraint up to the date of the upliftment of the restraint by the Court of Appeal. He contended that the respondent has, without lawful basis, refused to pay over to the applicants such accrued interest, resulting in the application.

Seretse also argued that the failure to pay the interest accrued from the restraint funds, contravenes Section 46 (4) of the PICA, in that the said provision enjoins the Respondent to preserve the value of the property under restraint and if same is released from restraint, then the owner is entitled to the true value of the property, including any interest accrued therefrom. 'By unlawfully withholding accrued interest, the respondent has been unduly enriched,' said Seretse. According to the court papers the accrued interest on the total funds restraint, was stated to be P50,293,738.10 being the amount that the applicants were claiming. The respondent's opposition According to the papers, the respondent confirmed that an application for civil forfeiture, in terms of the PICA, was lodged at the High Court and further confirmed that 16 properties were subject of the application. 'Further confirmed that the High Court and Court of Appeal dismissed the application by the DPP. The Receiver has further acknowledged that the restrained funds were released from such restraint, consequent upon the decision of the Court of Appeal,' read the papers. According to the respondent, the total sum of P82,379,876 that was held under restraint didn't belong to the applicants, but that it belonged to Capital Bank, whereat the said funds were held in a bank account.

The said P82,379,876 was said to have originated from government and therefore it was government's money, drawn from the National Petroleum Fund (NPF) and then deposited into bank accounts. Furthermore, the respondents argued that in fact the amount restraint was P69,734,260, which was found in Khulaco company's bank account. The respondent also admitted that the restrained funds were placed in an interest-bearing account and further that any interest accrued therefrom was never meant to be paid to the applicants, but to government through the Receiver. According to court documents it was the respondent's case that in terms of the PICA legislative framework, the Receiver is authorised to deposit any profits or investments and sales he would have made in relation to property confiscated into a fund called Confiscated Assets Trust Fund. 'On that basis, the interest accrued is paid into the same fund and it is not payable to any other claimant,' stated the respondent.