Tanesco loses US$ 66m Dowans appeal case,set to challenge the decision

The High Court yesterday rejected Tanesco’s petition seeking permission to appeal against an order to pay $65.8 million (105.3bn/-) to Dowans Tanzania Limited.

Justice Fauz Twaib said Tanesco did not use the right law in applying for permission to challenge the original order.Tanesco got a lifeline, however, when the judge ruled that it was free to use other sections of the law to challenge the payment order.

The application that was struck out springs from a judgment delivered in September last year by the High Court, which dismissed Tanesco’s first effort to get out of paying the $65.8million.

The International Chamber of Commerce (ICC) Arbitral Tribunal of November 2010 ordered Tanesco to pay Dowans Holdings SA (Costa Rica) and Dowans Tanzania Limited $65.8million for breach of a contract for emergency power generation.

The judge further ordered that the ICC’s award be formally registered and be a decree of the court. Tanesco responded in October last year by filing an application to go on to the court of appeal in its appeal.
But, yesterday, Judge Twaib said:  “The application is superfluous and I need not to consider it. The remedy is to strike it out.”

According to the judge, Tanesco did not need permission to appeal against the decision. Yesterday’s decision must have come as a great relief for Tanesco, which has vigorously attempted to block the order for many months now.

Tanesco’s lawyer, Dr Alex Nguluma, said they were happy with the decision as it indirectly gave them what they were seeking. The firm will soon be filing the case in the Court of Appeal.

At the hearing of the application, Dowans’ lawyer Kennedy Fungamtama asked the court to dismiss the application, arguing it could not be maintained since the judgment against which the appeal was being sought was not open to appeal, with or without leave of the court.

According to Mr Fungamtama, Tanesco would be entitled to appeal if it could at least claim that the decree was in excess of the award or was not in accordance with the award.

He further argued that Tanesco only intended to seek a further opportunity to challenge the ICC award and to permit the appeal would be tantamount to creating a right of appeal by implication.

Justice Twaib nevertheless agreed with Tanesco that some sections of the law could be applied to appeal against the decision. In October last year, High Court judge Emilian Mushi dismissed a petition by Tanesco that sought to block the payments. The firm wanted an order that the case be remitted to ICC for reconsideration on the grounds that it lacked merit.

This was followed a month later by the dismissal of a similar petition by five human rights organisations that asked the court not only to reject registering the award but also remit it to the ICC for reconsideration.

The five organisations, led by the Legal and Human Rights Centre, argued that the award was improperly achieved and was also contrary to public policy.
Source: The Citizen,www.thecitizen.co.tz, reported by Bernard James

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