Addis Fortune (Addis Ababa)

23 March 2014

Ethiopia: First Instance Court to Hear United Insurance Vs. Chamber of Commerce Case

The Chamber had stated that the Court had no right to hear the case and that it should be taken to arbitration

The Federal First Instance Court's Fifth Commercial Bench, on Monday, March 17, 2014, ruled that it has jurisdiction to hear the case of United Insurance SC versus. the Addis Abeba Chamber of Commerce & Sectoral Associations (AACCSA).

The judge passed the decision citing the Charter of the Chamber, which states that disputes could be resolved by arbitration only if they occurred between members of the Chamber. Since the dispute in the case under review is between the Chamber and one of its members, United, the judge determined that it could be seen by the Court and not by arbitrary bodies.

United filed a charge at the Federal First Instance Court on December 31, 2013, asking the Court to discard the legitimacy of the AACCSA's Charter, which cut the quorum size down to 500, from more than half of the 14,0004 strong membership, as indicated in the 2008's Charter of the Chamber, when amended in 2010. The insurance company's charge also suggested that the latter invalidates the Chamber's ninth general assembly meeting held on December 19, 2013, at the Hilton Hotel, saying that it failed to meet the quorum. United also demanded that the Court overturns the decision of the AACCSA's Board to bar Zafu Eyesuswork, United's representative, from any of the meetings of the Chamber.

Although it first submitted a statement of defence in written form to the Court on January 15, 2014, the Chamber requested, on February 12, to amend its response. The Chamber made the request, claiming that its original response would put the Chamber at risk and severely affect its survival, as it has legal and factual errors. The Court, however, rejected this request and decided to go ahead.

The two parties conducted oral proceedings on March 4, 2014, on the procedural issue of whether or not the Court has jurisdiction over the case.

In its statement of defence, the defendant claimed that the Court has no the right to hear the case and that the case should rather be taken to arbitration.

On the other hand, the oral proceedings that took place on March 4, 2014, focused only on procedural issues because of the unavailability of a voice recording facility at the Court.

Any dispute among members had to be arbitrated or referred to the Addis Abeba Trade & Industry Bureau, the defendant argued, citing its Charter of 2010. It, thus, claimed that the Court did not have any jurisdiction to see the case.

United countered that the Charter, which was amended in 2010, had to be discarded as it was approved in a meeting that did not fulfil the quorum and without getting two-thirds of the votes. Responding to the Chamber's original defence, United also argued that if the case had been a concern of the Ministry of Trade (MoT) or the Ministry of Justice (MoJ), these bodies would have addressed the dispute.

The Court adjourned the case until Wednesday March 26, 2014, to hear the remaining oral proceedings.

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