$8m judgment debt slapped on Euroget De-Invest firm
The International Court of Arbitration in London of the International Chamber of Commerce (ICC) has ordered the firm constructing a number of hospitals in Ghana, Euroget De-Invest S.A., to pay one of its subcontractors, Top International Engineering Ghana Limited, more than $8 million, representing outstanding balance and interests.
About $5.4 million of the amount represents outstanding balance that Euroget has to pay Top Engineering, while $1.06 million relates to interest on the outstanding balance from September 29, 2017, when the dispute between the two companies began, to June 29, 2021, the date of the arbitration award.
The rest of the arbitration award is in relation to the legal fees and other costs expended by Top Engineering during the arbitration.
The dispute between the two firms is connected to two hospitals being constructed by Euroget — the 500-bed military hospital at Afari, Kumasi, and the 60-bed hospital in Konongo, both in the Ashanti Region.
Top Engineering had argued that it provided some engineering services at the military hospital at a contract sum of more than $12 million, but Euroget paid it $7.5 million.
With regard to the hospital in Konongo, Top Engineering said the contract sum was more than $7.5 million, but Euroget paid it $4.8 million.
Euroget also made a counter-claim against Top Engineering and argued that the engineering firm delayed in completing its services, as agreed between the two parties.
The arbitration tribunal upheld the counter-claim and ordered Top Engineering to pay Euroget $710,000 in relation to the military hospital contract and $1,117,746.37 in relation to the Konongo project.
It was after deducting the amount to be paid by Top Engineering from what is supposed to be paid by Euroget that the arbitration tribunal arrived at the final arbitration award.
In 2017, Top Engineering dragged Euroget to the Accra High Court, claiming breach of contract and seeking payment of the balance of the contract sum.
On October 2017, the High Court stayed proceedings and ordered the case sent to an arbitration panel of the Ghana Institution of Engineering for determination.
In September 2018, the arbitration panel of the Ghana Institution of Engineering gave its decision and gave an arbitration award in favour of Top Engineering.
Euroget rejected the decision of the arbitration panel and served Top Engineering with a notice of dissatisfaction.
In 2019, Top Engineering filed an application at the High Court praying the court to adopt the arbitration award as its final judgement, but that was dismissed by the court as premature
The court, presided over by Justice Novisi Afua Aryene, ruled that per the contract between Euroget and Top Engineering, the two parties had resolved to settle their dispute by rules set out by certain international rules.
The rules, it held, stipulated that disputes shall be settled by an international arbitration tribunal when a party filed a notice of dissatisfaction against a local arbitration panel.
According to the court, since Euroget had filed a notice of dissatisfaction against the decision of the arbitration panel of the Ghana Institution of Engineering, the next stage was arbitration by an international arbitration tribunal.
“It provides that where notice is filed but the parties fail to agree amicably, the next stage is international arbitration,” it held.
It was based on the decision by the Accra High Court that the two parties referred the matter to the International Court of Arbitration of the ICC based in London, UK.
In view of the decision of the ICC, Top Engineering has filed an application at the Accra High Court, urging the court to adopt the decision of the ICC as its final judgement.
The application was filed on August 17, 2021, and is expected to be moved by lawyers for the firm when the court resumes from its legal vacation in October.