Lawyers for Ophir and BG argued that under the doctrine of res judicata, the London decision was final and conclusive and neither party was allowed to reopen the same matter.
Dar es Salaam. Leading oil and gas exploration firm, Ophir Energy, has suffered a legal setback after the High Court rejected its request to block hearing of a multi-billion-shilling suit against the company and its partners.
Earlier, Ophir Energy and two other two multinational companies lodged a preliminary objection against the main suit filed by Mr Moto Mabanga—a fixer who brought Ophir to Tanzania—on the grounds that a similar case had already been heard and decided in London.
In the case, a multimillion-dollar Tanzanian fixer, Moto Mabanga, is pursuing a spirited legal battle against former partner Ophir Energy and BG, which he has accused of dishonestly and unfairly locking him out of the benefits of three offshore gas fields in Mtwara. The first defendant, it is alleged by Mr Mabanga, paid him $7.5 million so that he could surrender his 15 per cent stake.
The court’s decision means the case now goes into full hearing and will be decided on merit.
Mr Mabanga, on the basis of documents filed before the court, is known to have played a key role in facilitating acquisition of Block 1, 3 and 4 which he initially jointly owned with Ophir and retained a 15 per cent stake between 2004 and 2005.
The relationship turned sour in March 2010 when, Mr Mabanga claims, his partners tricked him into surrendering his share at a throwaway price. He has told the court that Ophir unilaterally drafted a deed of termination of his contract and paid him “only $7.5 million” (about Sh12 billion).
Undue pressure was exerted on him by Ophir, he claimed, and in less then 48 hours he was forced sign the deed of termination.
It is his contention that the $7.5million offer he was paid for his share was made in bad faith with the intention to underpay him.
He is now asking the court to declare that he was hoodwinked into surrendering his 15 per cent interest at unfair price.
But before his case was heard and decided on merits, the three companies asked the court to dismiss the suit for being res judicata—that the Mr Mabanga had instituted similar suit in the English High Court of Justice which was conclusively determined in their favour in 2012.
Lawyers for Ophir and BG argued that under the doctrine of res judicata, the London decision was final and conclusive and neither party was allowed to reopen the same matter.
The argument met strong opposition from Mabanga’s lawyer, Mr Mabere Marando, who argued that the English court did not decide the case on merit as provided for by Section 11 (b) (c) of the Civil Procedure Code.
The summary judgment entered by the English court, Marando argued, was a procedure unknown to the civil practice in Tanzania, and had denied his client the right to be heard.
Section 9 of the CPC sets three conditions for the principle of res judicata to apply: First, the party seeking to rely on it to bar proceedings has to prove that the matter at hand was directly and substantially in issue in the former suit.
Secondly, the former suit should have the same parties as those in the suit before the court, and that it must have been finally and conclusively determined by a competent court.
In a decision he delivered last week, Justice Kassim Nyangarika said: “Each case which comes before a Tanzanian court must be decided in accordance with Tanzania law. It is implicit that the foreign law and foreign judgment would not offend against our public policy.
He sided with Mabanga’s lawyers that the first condition for res judicata to apply was not fully covered in the case before him to warrant dismissal.
“Whereas in the English court, the matter was determined on deceit, in the present suit, it appears that deceit was rather a means to procure consent and it all, if proved goes to substantiate under influence,” said the judge.
Another condition, which according to the judge, was not met to convince the court to dismiss the case, was that the parties in the English case were different to parties in the suit before him.
The Citizen
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