Polaris Bank Limited (“The Claimant”), represented by The Law Crest LLP, has successfully secured a favourable judgment for the recovery of debt against a former employee (“The Defendant”) of the Bank, further reaffirming the sanctity of contractual obligations and the enforceability of financial arrangements freely entered into by parties.
The action was commenced by the Claimant for the recovery of outstanding indebtedness arising from a loan facility advanced to the Defendant during the course of his employment with the Claimant. The Claimant’s case before the Court was that the Defendant, having obtained and fully utilised the loan facility, remained under a binding obligation to liquidate the outstanding balance upon his voluntary resignation from the Claimant.
Although the Defendant admitted his indebtedness to the Claimant, he contended that the Claimant had allegedly failed to pay his terminal entitlements and argued that the outstanding debt ought to be set-off against the said entitlements. In support of this contention, the Defendant relied on certain policy documents purportedly entitling him to the purported benefits. The Defendant also challenged the jurisdiction of the Court, contending that the loan arrangement was inseparable from his contract of employment and that the suit ought to have been properly commenced before the National Industrial Court.
In response, Counsel to the Claimant successfuly argued that the loan and mortgage transaction constituted a distinct contractual relationship, independent of the Defendant’s employment contract, and was therefore properly enforceable before the High Court.
In its well-reasoned judgment, the Court resolved the jurisdictional challenge in favour of the Claimant and reaffirmed the settled principle of law that a mortgage or loan agreement remains legally distinct and enforceable independent of an employment relationship. The Court consequently held that the High Court possessed the requisite jurisdiction to entertain the action.
