AREEBA LOSES APPLICATION TO GO FOR ARBITRATION IN LONDON

THE Commercial Division of the Accra Fast Track High Court, on Thursday refused an application for stay of proceedings pending arbitration in London filed by Scancom Limited, operators of Areeba mobile phone network, and its majority shareholder, Investcom Holdings LLC.
According to the court, granting the application would run counter to the High Court Civil Procedure rule of averting delay and unnecessary expenses, as well as the multiplicity of proceedings in more than one forum.
The court, presided over by Mr Justice Henry A. Kwofie, did not award costs and adjourned the case to June 21 to listen to another motion for interlocutory injunction by counsel for Grandview Management, Mr Thaddeus Sory, to stop the arbitration process, which the court thought had been waived because of its ruling.
Counsel for Investcom LLC, Mr Felix Ntirakwa, in moving the motion for stay of proceedings said the shareholders’ agreement of the company stipulated that whenever there was disagreement over shareholding ownership, arbitration should be resorted to.
His application was premised on Ghana’s Arbitration Act 1961, Act 38, especially Section 40, and the UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards adopted in New York on June 10, 1958, which proposed London as the venue for arbitration.
Counsel said care must be taken in order not to confuse interest of law situation in court proceedings with stay pending arbitration, saying that there was danger to rely on court issues.
He said the issue at stake related to shares, namely, capital call, dividends and the relationship between the plaintiff and Investcom LLC.
However, counsel for the plaintiff, Mr Yonni Kulendi, raised issue about whether the UK was a country recognised or declared by the President of Ghana to be a reciprocating party to the UN Convention and, if not, whether an application which proposed London as the forum for the arbitration could be granted when the law applicable was a Ghanaian law.
He said the countries recognised by the President of Ghana to be parties to the UN Convention did not include the UK, as the law stood currently, and in effect an arbitrary award obtained in the UK could not be enforced in Ghana.
Counsel said the application was not premised on desire for arbitration but to take procedural advantage to delay the case and also a calculated attempt to deny his client justice.
Mr Nutsupui, counsel for Scancom, who associated himself with the submission by counsel for Investcom LLC, said they were able and willing to participate in the arbitration and that the assertion that plaintiff had since 1999 ceased to be a shareholder did not hold, since he was bound by the shareholders’ agreement.
In its ruling, the court was of the view that clause 13 (5) of the shareholders’ agreement settled the issue of arbitration which was a private dispute resolution arrangement and did not bind persons/people who were not parties to it.
In the substantive case, the plaintiff, Mr Richmond Aggrey, sued Investcom Holdings LLC, Scancom Limited and Grandview Management Limited when Scancom decided to engage in a merger deal with South African giants, MTN Incorporated, claiming 20 per cent interest in the company.
The deal has, however, been concluded with the transfer of all shares in Scancom to the South African company.
That was after a High Court order on July 14, last year restraining Investcom LLC and Grandview Management from “continuing, progressing and or concluding the merger with and or acquisition of Investcom LLC by MTN without taking into account and or providing for the plaintiff’s/applicant’s 20 per cent shares in Scancom Limited”.
The closure of the acquisition, according to Mr Aggrey, would occasion the loss of his shareholding in the company by reason of the accrual of the rights of the MTN Group as a third party.
His contention was that his name had been removed from the shareholders’ list of Scancom Limited without any explanation.
Furthermore, the plaintiff is claiming against the defendants, jointly and severally, an order directed to Scancom Limited to pay him his true dividends declared from the 2000 to 2005 financial years and also include his name in the shareholders’ list.