HC issues enjoining order pending inquiry

Sarath Malalasekera

Colombo High Court Judge K. T. Chitrasiri issued an enjoining order pending the inquiry into the interim injunction restraining the defendant from terminating and frustrating and not giving effect to Contract for no fault or neglect on part of the plaintiff, pending the determination of dispute.

The plaintiff Midgulf International Limited, Gladstones Street Fouloune House Limassol, Cyprus cited Ceylon Fertiliser Company Limited, Hunupitiya, Wattala as a defendant.

The Plaintiff through his lawyers Sudath Perera Associates stated that the plaintiff is a company with limited liability duly incorporated in Cyprus and having its registered office at the above address.

The Defendant is a limited liability company duly incorporated in Sri Lanka and having its registered office at the above address.

The plaintiff further stated that the contract hereinafter sought to be enforced were entered into and the cause of action hereinafter set forth arose within the local limits of the jurisdiction of this court.

The plaintiff states that the cause of action set out hereinafter arose out of a commercial transaction within the purview of the High Court of the Provinces (Special Provisions) Act No. 10 of 1996 and as such, this Court has jurisdiction to hear and determine this action.

Pursuant to tenders being called for the supply of 60,000 +/- 5 per cent metric tons of Triple Super Phosphate (TSP) fertiliser (in bags) to the defendant, in 5 lots of 12,000 +/- 5 per cent metric tons each, the plaintiff on or about June 11 submitted its tender in respect of all 5 lots.

On or about June 24 the defendant informed the plaintiff in writing that its tender/offer in respect of lot 2 has been accepted by the defendant and awarded the tender in respect of lot 2 to the plaintiff.

Lot 1, 3, 4 and 5 were awarded to third parties. Lot 2 awarded to the plaintiff is for the supply of 12,000 +/- 5 per cent of TSP fertiliser (in bags). Sujimpex Associates, local agent of the plaintiff accepted of the said award in respect of lot 2 for and on behalf of the plaintiff.

The plaintiff states that the award of the said tender to the plaintiff by letter dated June 24 marked P1 and the acceptance of same by the plaintiff constitutes the contract between the parties relating to Lot 2. The plaintiff states that the entering into a written contract is a mere formality.

By the said Letter of Award marked P1 and contract marked P3 the plaintiff and the defendant specifically agreed, inter alia, as follows: Product - TSP fertiliser (in bags), Quantity - 12,000 +/- 5 per cent metric tons (Lot 2), Price - US $ 1,310 per mt C&FFO (180 days credit), Payment - Letter of Credit and Delivery in Colombo - Mid August 2008.

The plaintiff to provide a Performance Bond for 10 per cent of the value of the total quantity of the award.

Any dispute, difference, controversy or claim arising out of or relating to the contract or any breach, termination invalidity or interpretation thereof, it cannot be settled amicably shall be settled by Arbitration in Sri Lanka in terms of the Arbitration Act No. 11 of 1995.

President's Counsel Nihal Fernando with Ms Ruchira Anthony instructed by Sudath Perera Associates appeared for the plaintiff.