Court orders bank to compensate IPTL

THE High Court has ordered Standard Chartered Bank (Hong Kong) Limited to pay shareholders of Independent Power Tanzania Limited (IPTL) costs for failure to prosecute its application during hearing of winding up proceedings involving the company.

Judge John Utamwa ruled that the IPTL shareholders, VIP Engineering and Marketing Limited and Mechmar Corporation (Malaysia) Berhard, who were respondents in the application, were entitled to the costs, considering circumstances surrounding the matter.

Though no specific amount was mentioned, legal experts suggest that the amount could be in terms of billions of shilling, even if it will be subject for taxation, considering that the case had involved IPTL, a giant electricity generation company.

On November 15, this year, Advocate Gaspar Nyika, for the bank, informed the court that his client decided to withdraw the petition for appointment of administrative receivers ‘’after being overtaken by events.’’

Mr Nyika had submitted that the withdrawal for winding up petition (of IPTL lodged by VIP Engineering and Marketing Limited) pursuant to the order of this court dated September 5, this year, has rendered the petition redundant. He requested each party to the matter to bear its own costs.

Advocates for the respondents Michael Ngalo and Senen Mponda, respectively, could not raise objections to the withdrawal of the petition lodged by the bank, but requested the court to award their clients costs they had incurred during hearing of the matter.

In his ruling, Judge Utamwa pointed out that he had considered the prayed withdrawal in hand to be in favour of the respondents as, according to the records, ‘’they had hotly objected to the petition and accordingly filed their respective replies to the petition.’’

The judge took note of the records on the matter since the petition was filed in 2009; during which parties to the dispute have been involved in a manner of vehement interlocutory squabbles, some of which attracted court rulings and orders.

In recent instance, according to the judge, the Bank referred the matter to the Court of Appeal for revision of an interlocutory order of the court – with the parties concerned required appearing before it and making arguments there.

“But they came back to this court (High Court) apparently because the Bank’s application for revision was unsuccessful for a reason or another. The above trend of this matter implies that parties in this petition indeed incurred some costs in their true meaning,” he said.

In the petition, the bank had sought for appointment of advocate Laurence Masha and British lawyer Charles Morison as joint administrative receivers of IPTL, claiming that it is a creditor of the electricity producing company.

The withdrawal of the application came after the Court of Appeal rejected with costs the application lodged by the bank to challenge orders given by the High Court in a matter involving winding up proceedings of IPTL.

Justices January Msoffe, Steven Bwana and Ibrahim Juma ruled against the bank after upholding a ground of objection that was raised by Mechmar Corporation (Malaysia) Berhard that the application in question was hopelessly time barred.

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