IPTL GIVEN 21 DAYS TO CHALLENGE QUEEN'S BENCH

The High Court’s Commercial Division has given 21 days the Independent Power Tanzania Limited (IPTL) to challenge enforcement of foreign judgment for payments of 168,800,063 US dollars in favour of Standard Chartered Bank Hong Kong Limited and Standard Chartered Bank Malaysia Berhard.

Judge Barke Sahel reached into such decision last week after allowing an application by the two banks for reciprocal enforcement of the judgment given in their favour by the High Court of Justice Queen’s Bench, Division Commercial Court of England, late last year.

In allowing the application, the judge was satisfied that the conditions set in the Reciprocal Enforcement of Foreign Judgment Act, have been met. She therefore registered the judgment and orders on the November 16, 2016 issued by the London Court.

“The respondent (IPTL) may make an application for setting aside the registration within 21 days from the day of service of this ruling. Notice of registration be served to the respondents specifying that execution of the judgment will not issue until after the expiry of 21 days,” she said in the ruling.

Advocate Gasper Nyika had appeared for the two foreign banks to urge the application, saying that the requirements of law were complied with since the judgment which they wished to be registered arose from the London Court in a country which is enlisted in the Act as one of reciprocating territory.

Reached for comment on the decision, the IPTL’s Company Secretary and Chief Legal Counsel, Mr Joseph Makandege, expressed his concern for the court to proceed determining the application for enforcement of foreign judgment involving such colossal amount without hearing the affected party.

“This is surprising indeed. Mind you, the subject matter, which is IPTL plant, is in Tanzania. But these people (the two banks) have avoided our courts here and went to litigate in England and when it comes to enforce the judgment our court hears that application ex-parte.

This is unfair,” he said. Mr Makendege, therefore, indicated that IPTL would strongly oppose the enforcement of such “summary” judgment because the foreign judgment which is purported to be executed is neither enforceable nor could be registered in Tanzania.

It is a summary judgment because IPTL and two other defendants, Pan African Power Solution Limited (PAP) and VIP Engineering and Marketing Limited had not submitted their written statements of defence to the claims by the two foreign banks.

The three local companies have been contesting against the jurisdiction of the London Court, Division Commercial Court, to hear the matter because the IPTL plant and all other assets are in Tanzania and the course of action relating to the matter originated from the East African nation.

They had been contending further that there were two other cases that were filed before the High Court of Tanzania prior to the English proceedings concerning the central issue on whether Standard Chartered Bank is a legitimate creditor of IPTL. However, the London court ignored such facts and dismissed the contentions by the local companies, hence proceeding in favour of the banks without hearing both parties on merits.

One of the cases was filed by IPTL and PAP for payments of over 6tr/- and that of VIP seeking payments of over 1tr/-. Standard Chartered Banks have been avoiding the Tanzania proceedings by employing delaying tactics to ensure the London proceedings are determined first.

In the summary judgment dated November 16, 2016, Judge Flux ruled that Standard Chartered Bank is a legitimate creditor of IPTL. He said that the facility agreement, security deed, shareholder support deed and charge of shares were valid, effective and remain valid, effective and binding.

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