Commercial Court Rejects Areeba's Application

By William Yaw Owusu

Monday, 05 February 2007
The Commercial Court in Accra, has rejected an application for stay of proceedings pending an arbitration in the case in which a lawyer, David Andreas Hesse has sued Investcom Consortium Holdings and Scancom Limited, operators of Areeba mobile phone service provider for breach of a shareholders’ agreement in Areeba.

Dismissing the applications, the court held that, the United Kingdom, the venue for the proposed arbitration is not recognised by Ghana to be party to the United Nations Convention which established the International Court of Arbitration.

"In effect, an arbitral award obtained in the UK cannot be enforced in Ghana since Legislative Instrument 261 has not been amended to cover all current parties to the convention."

The court further held that once an allegation of fraud had been raised by Mr. Hesse in the suit, it was only a court of law that could determine the matter since an arbiter might not be able to discern the fraud.

"I am satisfied that the particulars of these matters which have been pleaded satisfy the requirements of the law and are sufficiently substantial to justify a refusal of stay in order that the court will try these serious issues," the court said.

Investcom and Areeba filed separate applications to stay proceedings on December 21, last year, so that the parties could settle the matter through arbitration in London. However the court, presided over by Justice Cecilia H. Sowah, dismissed the applications and awarded ¢3 million cost each against the applicants.

On November 29, 2006, Mr. Hesse sued Investcom and Areeba seeking among other things, an order to reverse an alleged capital increase and dilution of his shares from six to two per cent and the transfer of the shares from him to Investcom.

He also wants an order to restore his six per cent shares in Areeba, a perpetual injunction restraining Areeba from removing him as a director as well as an order for the parties to go into account to determine the amount of dividends due him on his shares.

Mr Hesse again filed a motion for an interlocutory injunction to restrain Areeba from convening an extraordinary meeting to remove him as director of Areeba, pending the determination of the suit.

It is upon these developments that Investcom and Areeba filed for the stay of proceedings, arguing that the resolution of the matters raised by Mr. Hesse fell with the scope of a shareholder’s agreement and its amendment entered into by the shareholders of Areeba which had an express arbitration clause.