Supreme Court of Appeal upholds High Court ruling on forfeiture of Paul Mphwiyo’s house

* The court below was within the law when it made the order of forfeiture

* It invoked the provisions of Section 121 of Criminal Procedure & Evidence Code

* Which allows the State to apply for forfeiture of bonded property where there is breach on the conditions of bail

By Duncan Mlanjira

The Supreme Court of Appeal has upheld the decision by the High Court on the forfeiture of fugitive Paul Mphwiyo’s house at Area 43 in Lilongwe, agreeing that the order was properly made under the law.

The judgment delivered yesterday, December 5, by the nine-member Justices of Appeal led by the Chief Justice Rizine Mzikamanda JA, says having heard from the State and Mphwiyo’s wife, Thandizo Verna Mphwiyo, they found there was no merit in the appeal.

They observed that High Court Judge, Justice Ruth Chinangwa, “invoked the provisions of Section 121 of Criminal Procedure & Evidence Code which allows the State to apply for forfeiture of bonded property where there is breach on the conditions of bail”.

“The accused absconded bail and his bonded property was forfeited to the State. It is only the depositor, the accused in this case, who had the right to be heard.

“That opportunity was given as he was served with a notice. The court below was within the law when it made the order of forfeiture,” said the ruling.

A statement from principal public relations officer of the Anti-Corruption Bureau (ACB), Egrita Ndala says the house, which is valued at K690 million, is property of Malawi Government.

The appeal was filed by Mphwiyo’s wife, who was challenging the forfeiture order of the house, which was bonded by her husband, Paul, who is answering corruption charges in court related to the Cashgate scandal, whose case awaits judgment. 

The order was made by the State through the ACB to revoke Mphwiyo’s bail after he absconded from the charges of theft by public servant contrary to Section 278 as read with Section 286(1) of the Penal Code; money laundering contrary to section 35(1)(c) of the Money Laundering; proceeds to Serious Crime and Terrorist Financing Act and conspiracy to defraud contrary to section 323 of the Penal Code

His wife applied as an intervenor for the order be stayed and set aside — arguing in court that the house (Alimaunde 43/2/877) was a matrimonial property and that “the general principle when dealing with stay is that the court does not make a practice of denying a successful litigant the fruits of his litigation”.

It was argued that from the March 24 ruling of forfeiture, the Court “was alive to the devastating impact of a forfeiture order on third parties” and that in particular, “the Court wanted to know if the home was a matrimonial one”.

But Justice Chinangwa observed that instead of inviting the wife to make representations, the State was content to simply make submissions highlighting that it was only Mphwiyo’s name that appeared on the property register.

“The fact that it’s only a single spouse’s name appearing on a property register is not conclusive evidence that the said property is not matrimonial,” she said. “The Court should have looked at all of the facts including the facts of intention of the parties as well as their contributions.

“The Court should have taken judicial notice of the fact that it is common practice for married couples in Malawi to have family assets in the name of one spouse.”

The Court further observed that the wife, as an intervenor “deponed that despite her name not appearing as joint proprietor of the property in question, she did substantially contribute financially and in kind on the acquisition and development of the property in question”.

“Thus, the house in Area 43 cannot be forfeited against this interest in the property. It was further argued under section 66 of the Financial Crimes Act that before forfeiture orders are made, care is taken to notify all persons who may have an interest in the property to come forward and make representations.”

After analysing the arguments from both parties, Justice Chinangwa upheld the State’s application to have the property forfeited.

Mphwiyo, the key suspect in the Malawi corruption scandal popularly known as Cashgate, was reported missing in July last year just days before a high court judgment on his case was to be passed.

If he was convicted, he faced over 10 years in prison but he escaped and is believed to be in South Africa.

The former Budget Director in the Ministry of Finance, was once heralded as the man shot in the face because he was fighting corruption.

According to a report in July 2023 by Platform for Investigative Journalism (PIJ), CCTV footage showed Mphwiyo had checked into Ryall’s Hotel in Blantyre after flying in from Lilongwe.

He only spent approximately 10 minutes inside the hotel and was seen on CCTV leaving the hotel on foot and vanished as all his known mobile phone numbers could not be reached.

The report further said on June 26, Mphwiyo’s wife filed a missing person report with Lingadzi Police in Lilongwe and National Police Headquarters spokesperson Peter Kalaya confirmed with PIJ that they had launched an investigation into Mphwiyo’s disappearance and suspected to be escaping from prosecution.

Kalaya told PIJ that their investigations indicated that Mphwiyo boarded a plane and disembarked at Chileka Airport and went to Ryalls Hotel.