13 January 2013

Libya: Firm Sued Over U.S.$36 Million Double-Dealing

Dar es Salaam — The government of Libya has instituted a suit against the Meis Industries Company Limited (MICL) together with a court broker, Mustafa Nyumbamkali, for swindling over Tsh57.3bn (about $35.97m).

In a suit lodged recently by the Embassy of Libya to Tanzania in the High Court of Tanzania, both defendants are said to have had withdrawn the colossal sum from Tanzania Investment Bank (TIB) to the detriment of the Libyan Government.

The said Libyan embassy has engaged two counsels, Taher Muccadam of Muccadam & Co. Advocates, and Gabriel Mnyele of Marando and Mnyele & Co. Advocates, in executing Civil Case No. 225 of 2012 of the High Court ad Dar es Salaam for the purpose of recovering the monies been dished from the account of the government of Libya within the said bank.

Accordingly, the MICL is alleged to have been credited with $17.36m in its account no. 004200000447902 by TIB within the same bank, while Mr. Nyumbamkali was also credited Tsh24.22bn ($15.21m) at his account no. 011103026411 within the National Microfinance Bank (NMB) Temeke branch, Dar es Salaam, as well as Tsh5.34bn ($3.35m) paid to MICL as costs.

The lawyers for the Libyan government maintained that their client sustained loss in terms of foreign exchange amounting $17.36m and further loss in terms of local currency amounting Tsh29.57bn ($18.56m) thereby totaling Tsh57.35bn (about$36m).

Under any circumstances, the counsels for the Libyan government have sought refund of such monies to their client plus general damages not less than $200m.

Notwithstanding, the counsels have stressed that the Libyan government's claims against the company and court broker, jointly and severally is for a declaration that a verdict of Judge Samwel Karua in Civil Case No. 124 of 2010 be declared null and void and be set aside, together with the decree and any subsequent rulings and orders emanating therefrom for having been fraudulently obtained and for lack of service to it for the order to pay both of them.

It should be noted that the MICL is a joint venture between a businessman, Islam A. Saleh, who purported to entered into Investment Agreement with the Great Socialist People's Libyan Arab Jamahiriya for establishment of a cement industry in Lindi, on one hand, and the Minister for Foreign Affairs and International Cooperation, Mr. Bernard Membe, on the other hand, who is said the service of Civil Case No. 124 of 2010 before Judge Karua to the Libyan Embassy was channeled through his ministry.

Minister Membe had on 3rd July, 2009, written a letter to the Prime Minister of Libya, referring their conversation in respect of credit facility of Tsh28.9bn (about $18.15m) laying in TIB as to be extended to the company for the proposed cement factory in Lindi.

An investigation conducted proves the money to belong to the government of Libya held in TIB following failure of the government of Tanzania to pay Libya for oil supplied in 1983 on credit basis.

Anyway, the counsels have stated in the plaint against the first two defendants that the company filed its suit on 13th September up to 17th October, 2010, when Judge Karua gave his order of service of the suit to the Libyan diplomatic office through Membe's ministry.

"The Ministry of Foreign Affairs and International Co-operation has no power to serve Court Summons to anybody under the Civil Procedure Code, Cap. 33 Revised Edition 2002 of the Laws of Tanzania," the lawyers stressed in the plaint and further averred to be fraudulent move of the company in misleading the court and deny the plaintiff a right to defend itself, thus making all the proceedings null and void.

Notwithstanding, they said the suit was heard ex-parte within very short time and judgment given within six days for the company to dish the colossal money from TIB and further awarded general damages of $14m.

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