Africa-Press – Seychelles. • Judgment to pay award and costs “will mean the end of the company”, Counsel Georges says
Vijay Construction Company Ltd, one of the biggest and most renowned in Seychelles, has lost its appeal and is liable to make a substantial payout exceeding €20 million to Eastern European Engineering Limited (EEEL).
The special Justices of Appeal, namely, Justice Winston Anderson, Justice Carl Singh and Justice William Young who were sworn especially for the case on October 10, gave their unanimous judgment yesterday morning, dismissing the appeal, thereby upholding the decision of the Supreme Court to have the two orders of the High Court of England registered and enforced in Seychelles.
Legal Counsel representing EEEL, Basil Hoareau, noted that his clients are satisfied that “justice has been served” even if it has taken some time, and that the decision is exactly the outcome which they were hoping for.
As per the facts of the case, EEEL and Vijay entered into six contracts in relation to the construction of the Savoy hotel in 2011, and had under the contracts agreed to submit disputes to arbitration under the Rules of Arbitration of the International Chamber of Commerce (ICC) in Paris. Following disputes over the quality of the work and timeframe of the construction, EEEL filed a Request for Arbitration in September 2012 through the ICC, and was largely successful. In his award of November 14, 2014, the arbitrator held that EEEL had validly terminated the six contracts and ordered Vijay to pay €15,963,858.90 damages along with costs.
Having failed to enforce the award owing to the fact that Seychelles was not a state party to the New York Convention, EEEL decided to register the arbitration award as a judgment in the High Court of England, who gave an order to the effect that the arbitration award can be enforced in the UK. Vijay appealed against this, and their appeal was dismissed, which brought about a second order. This meant that the two orders could possibly be registered and enforced in Seychelles through a 1922
statute called ‘Reciprocal Enforcement of British Judgments Act’ (REBJA).
“As far as I have been instructed by my clients, over €33 million is outstanding, inclusive interest accrued on the basis of these orders,” Mr Hoareau said.
“The court has not ordered for an amount to be paid, but has ruled that the order made in the UK and which orders Vijay to pay the sums, can be registered and enforced in Seychelles. This means that the UK judgment will be treated as if it was a judgment from the Seychelles,” Mr Hoareau clarified.
The question which arose in the Supreme Court and now before the Court of Appeal is whether the said orders by the High Court of England were in fact judgments as intended by REBJA. At the same time, it brought about the question as to whether enforcing the orders would be just and convenient and in accordance to public policy of Seychelles.
It was Vijay’s argument that the orders were not judgments, and that it was not just and convenient that the orders be enforced and registered in Seychelles because they were simply an arbitration award which was clothed as a judgment.
The Justices however dismissed the appeal on the grounds that they agreed with Judge Ellen Carolus that the orders were judgments, and based on the premise that EEEL was not re-litigating the same matter as argued by Vijay.
EEEL will now face another lengthy process in enforcing the orders and securing the funds from Vijay, according to Mr Hoareau. Processes to discover whether Vijay has the funds available and the procedures to recover the funds. It is possible that individuals associated with the company will be held accountable for the company’s death.
For his part, Counsel representing Vijay was unsurprisingly disappointed with the decision. Discussions with the EEEL team would have to follow to decide how the award will be settled.
Contrarily to what the EEEL team had expressed to the media, Mr Georges said it is unlikely that the debt has reached €33 million, even with interests. By 2019, the amount payable had reached €20 million. In any case, the company lacks the funds and assets to make the pay-off.
“Obviously I am disappointed at the outcome. I have to respect the judgment given by three very good judges who have a good reputation, so I have to accept that this is the end of the road. But, I am disappointed since the Court of Appeal in 2017 had said that an arbitration award could not be enforced in Seychelles, but now it seems as though if this is not the case, all that one needs to do is head to another country and obtain a judgment to get around this obstacle. As an Attorney I find this difficult to accept,” Mr Georges said.
“It will mean the end of the company, because the assets of the company do not amount to the debt. But EEEL’s interest is in getting paid, and not the closure of the company, so I think we can find a solution,” Mr Georges added.
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