WILLEMSTAD – GI-RO Settlement Holding (GSH) was not entitled to charge Villapark Fontein penalty interest for part of the period during which the developer was given additional time to repay its debt. The Joint Court of Justice has upheld that conclusion on appeal, rejecting GSH’s objections to an earlier ruling.
Villapark Fontein had been borrowing from Girobank since 2011 to finance the development of the residential project. At the end of 2020, Girobank informed the company that its financing would no longer be extended, forcing Fontein to look for alternative financing.
The loans subsequently became part of the portfolio of GI-RO Settlement Holding, which took over a portion of Girobank’s loan portfolio as part of the bank’s settlement process.
Fontein ultimately repaid its outstanding debt in full in September 2022. As part of that settlement, however, it also paid ANG 168,959 in additional interest for late repayment.
The developer challenged part of that penalty interest in court, arguing that it had been given additional time to repay without being told that the extra interest would continue accumulating.
The Court of First Instance partially agreed with Fontein, concluding that the company could reasonably assume it had until the end of 2021 to repay without incurring penalty interest during the extension period.
GSH appealed that decision, but the Joint Court has now rejected its arguments.
Central to the dispute was an email sent by GSH’s attorney in September 2021. In that communication, Fontein was given until the end of December 2021 to fully repay the debt.
According to the Court, the email did not state that penalty interest would continue to be charged during those additional months.
The judges concluded that Fontein could therefore reasonably understand the extension to mean that no penalty interest would be due during that period. If GSH intended to continue charging the additional interest, it should have explicitly said so.
The Court also considered it relevant that the communication had been drafted by an attorney. Any ambiguity about the conditions of the extension therefore falls on GSH rather than Villapark Fontein.
The ruling means GSH cannot retain the portion of the penalty interest that the courts found was improperly charged during the extension period.
However, another part of the financial dispute remains unresolved and will now proceed to the taking of witness testimony.