SHC orders attachment of Hascol Petroleum assets
KARACHI: The Sindh High Court (SHC) has ordered to attach certain assets of Hascol Petroleum Limited in execution proceedings of a money decree issued by a court in England.
High Court of Justice, Business and Property Courts of England and Wales, Commercial Court (QBD) on June 15, 2018, had awarded $9,500,000/ to M/s Mena Energy UAE, the decree-holder against the judgement debtor, M/s Hascol Petroleum Limited.
The decree-holder had approached the SHC for its execution under Section 44-A of the Civil Procedure Code (CPC) against the judgement debtor.
Ijaz Ahmed, counsel for the decree-holder submitted that before the foreign Court there was a claim by the decree-holder and judgement debtor’s counterclaim.
He submitted that the counterclaim was dismissed and it was held liable to the judgement debtor, and that was when the parties entered into the Settlement Agreement on January 19, 2018.
The Settlement Agreement as amended on January 23, 2018, a draft of the consent judgment was signed by both parties and been retained in escrow with the stipulation that if the judgement debtor did not pay, the decree-holder will be free to present the consent judgment to the foreign Court, said Ahmed.
With regards to the SBP’s approval, the counsel submitted that obtaining such approval was the obligation of the judgement debtor and not only did the judgement debtor delayed making the requisite application to the SBP, it also did not pursue the same.
He contended that the judgement debtor could not take advantage of its own wrong and the SBP approval for remitting the money abroad was no impediment to the Execution, as once the money was recovered at Karachi, the decree-holder would apply to the SBP for remitting it abroad.
Justice Adnad Iqbal Chaudhry, in its detailed judgment held that every foreign judgment by consent of the parties was not a judgment on the merits of the case so as to attract exceptions contained in section 13(b) CPC.
He held that recitals to the Settlement Agreement showed that the parties were litigating under contracts of supply of gasoil, and fuel oil where under shipments were made by the decree-holder to the judgement debtor in Karachi.
The foreign court (in England) seized the case, observed Justice Chaudhry, and had split the trial into two parts; the first to determine liability between the parties, and the second to determine the quantum of liability.
The SHC judge noted that the first part of the trial was determined against the judgement debtor by a judgment of February 16, 2017.
“It was just before the second part of the trial that the parties came to an agreement on the quantum of the judgement debtor’s liability and the manner of its payment to the decree-holer, i.e. the Settlement Agreement of January 19, 2018, which was then modified by an Addendum on January 23, 2018,” observed Justice Chaudhry.
He also noted that under the Settlement Agreement, the judgement debtor agreed to pay a sum of $9,500,000 in full and final settlement of the decree-holder’s claim pending before the foreign court, in four instalments commencing from 19-05-2018 (clause 1.2) by remitting the same to the decree-holder’s bank account at Dubai.
“In the meanwhile, the judgement debtor was to provide to the decree-holder bank guarantees in PKR equivalent to each instalment from a bank in Pakistan. The parties agreed to retain with an escrow draft of four consent judgments duly signed by the parties, the first one being for $9,500,000 with the stipulation that if the judgement debtor does not pay the first instalment or does not furnish the bank guarantee, then the entire amount of $9,500,000 will immediately become due and owing, and the decree-holder will be at liberty to present the consent judgment to the foreign court,” added the SHC judge.
With these observations, Justice Chaudhry allowed the execution ordered attachment until further orders and prohibited the judgement debtor from transferring the shares held by it in the following companies together with any bonus and right shares: (a) Hascombe Lubricants (Pvt.) Ltd., having its office at Suite No. 105-106, The Forum, Khayaban-e-Jami, Block 9, Clifton, Karachi; (b) VAS LNG (Pvt.) Ltd. having its office at Suite No. 102, 1st Floor, The Forum, Khayaban-e-Jami, Block 9, Clifton, Karachi; (c) Hascol Terminals Ltd. having its office at Plot No.s D-15 to D-18, G5 and G6, North Western Industrial Zone, Port Qasim Authority, Bin Qasim, Karachi.
The SHC also prohibited the judgement debtor from withdrawing or transferring the credit balances of its bank accounts maintained with various banks list of which was attached with the order.
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