Sunday October 24, 2021

Enforcement of $9,500,000 decree: SHC attaches properties of private petroleum company

October 15, 2021

KARACHI: Sindh High Court has ordered attachment of private petroleum company properties in Pakistan and restrained company from transferring of its shares on execution application of foreign energy firm for enforcement of US$95,00,000 decree by UK commercial court.

The order came on execution application filed by UAE based energy firm Mena for enforcement of a foreign court judgement passed by high court of justice, business and property courts of England and Wales commercial court. The UK court had awarded US$9,500,000 decree to UAE based energy firm against a private petroleum company Hascol, which is incorporated in Pakistan.

The Hascol counsel objected to the execution submitting that foreign judgment was based on a settlement agreement between the parties which cannot be said to have been given on merits of the case. He said that payment to the decree holder under the settlement agreement was conditioned on an approval of State Bank of Pakistan and therefore until the SBP approval the foreign decree cannot be executed. He submitted that parties had agreed that only the courts of England and Wales would have jurisdiction to decide any dispute arising under or in connection with the settlement agreement. On the other hand, the decree holder (Mena) counsel submitted that it was stipulated in the consent judgment that if the judgment debtor does not pay, the decree holder will be free to present the consent judgment to the foreign court for sealing and sought execution of decree in favour of the decree holder.

The SHC’s single bench headed by Justice Adnan Iqbal Chaudhry after hearing the arguments of the counsel parties were litigating under contracts of supply of gas oil and fuel oil where under shipments were made by the decree holder to the judgment debtor at Karachi. The court observed that judgment debtor (Hascol) had agreed to pay a sum of US$9,500,000 in full and final settlement of decree holder claim pending before foreign court in four installments commencing from May 19, 2018. The court observed that foreign decree was conclusive between the parties within the meaning of section 13 CPC and is executable under the law dismissing Hascol's objection. The court ordered attachment of Hascol’s properties including Hascombe lubricants, VAS LNG and Hascol terminals prohibiting judgment debtor from transferring of its shares held by it in its companies together with any bonus and right shares. The court also restrained it from withdrawing or transferring the credit balances of its bank accounts maintained with the banks.