Interim injunction sought against Ceylon Shipping Corporation refused

Commercial High Court Judge Gamini Amarasekera yesterday issued an order refusing to grant interim injunction prayed for, by Mercator Lines (Singapore) Ltd thus holding in favour of Ceylon Shipping Corporation Ltd, in a case related to the supply of coal to the Lakwijaya coal power plant in Puttalam.

Mercator Lines (Singapore) Ltd, instituted Action in the Commercial High Court against Ceylon Shipping Corporation Ltd and Lanka Coal Company (Pvt) Ltd, for the alleged wrongful termination of a contract in relation to the transportation and lightering of Coal required for the Lakwijaya Coal Power Plant in Puttalam.

Mercator Lines (Singapore) Ltd pleaded that the dispute was to be referred to Arbitration but nevertheless sought Injunctive relief restraining the Ceylon Shipping Corporation Ltd, from giving effect to the letter of termination and/or contracting with a third party and sought a further Injunction mandating the Ceylon Shipping Corporation Ltd to perform the Contract until the arbitral tribunal was properly constituted and the Plaintiff Mercator Lines (Singapore) Ltd is able to move for interim relief there.

Counsel for Mercator Lines (Singapore) Ltd, Dr. Harsha Cabraal PC on October 12, 2012 informed Court that he is not supporting the application for Enjoining Orders, when Faiszer Musthapha, PC Counsel for the Ceylon Shipping Corporation Ltd sought to resist the same.

It was agreed that the inquiry in respect of the Interim Injunctions be disposed expeditiously and at the inquiry Counsel Faiszer Musthapha raised several objections on behalf of the first defendant Ceylon Shipping Corporation Ltd, against the granting of injunctive relief including that the purported dispute of termination is not a matter agreed by the Parties to be submitted to Arbitration and hence the relief sought is not tenable in Law, that Mercator is not entitled to seek specific performance of an agency contract by way of injunctive relief, that the appropriate relief for the Plaintiff would be damaged if at all, that the Plaintiff is not entitled to interim relief because it has breached the principle of utmost good faith in suppressing the several instances that the Plaintiff was in breach of the Agreement and that grave and irreparable loss would be caused to the Ceylon Shipping Corporation Ltd who is primarily responsible for the procurement of coal in as much as 20 percent of the total supply to the National Electricity Grid could be affected. Faiszer Musthapha appeared with Farman, Cassim, Isuru Balapatabendi and Tharaka Nanayakkara for the Ceylon Shipping Corporation Ltd instructed by M/s Murugesu and Assocaites and Dr. Harsha Cabraal appeared with Buddhika Ilanganthilake for Mercator Liens (Singapore) Ltd, instructed by M/s Neelakandan and Neelankandan.