Mengiste & Anor v Endowment Fund for the Rehabilitation of Tigray & Ors
2014
CHANCERY DIVISION
United Kingdom
CORAM
- THE HONOURABLE MR JUSTICE PETER SMITH
Areas of Law
- Civil Procedure
- Conflict of Laws
- Commercial Law
2014
CHANCERY DIVISION
United Kingdom
CORAM
AI Generated Summary
Peter Smith J of the High Court (Chancery Division) addressed applications following his March 22, 2013 judgment staying the Claimants’ English proceedings pending possible review in Ethiopia of two discrete matters—the 2005 Inventory of factory machinery and the participation of Judge Mehretab, spouse of EFFORT’s CEO, in hearings. The Claimants applied to lift the stay after seeking review under Article 6 of the Ethiopian Civil Procedure Code in the Tigray Supreme Court, and appealing to the Cassation Division of the Federal Supreme Court, both of which dismissed their petitions on grounds including failure to satisfy Article 6’s one‑month time limit and lack of qualifying “new evidence”. The Defendants sought dismissal of the English action for noncompliance with a £200,000 costs order. The Court refused to lift the stay, found no cogent evidence of unfair Ethiopian proceedings, denied relief from the costs obligation under CPR 3.9 due to inadequate financial disclosure, rejected asserted set-offs, and granted the Defendants’ application to dismiss.
Judgment
Peter Smith J:
INTRODUCTION
This judgment arises out of a hearing I heard between 28th and 31st July 2014. The hearing itself arises out of a judgment I delivered on 22nd March 2013 [2013] EWHC 599 (Ch) . Reference should be made to that judgment for the detailed background of the issues.
In summary the Claimants seek damages (for) it is alleged the wrongful obtaining of their share in businesses in Ethiopia. The Claimants had had extensive litigation in Ethiopia as set out in that judgment. In it they were successful as to part of their claims but unsuccessful as to others. In reality the Claimants’ case before me was that the judgments in Ethiopia were obtained by perjury and fraudulent means in particular by the deliberate withholding of material evidence. They also claimed that the Ethiopian Courts were biased against them.
The issues are summarised in paragraphs 109-133 of the judgment in the other hearing. The issue was over the delivery of machinery by the Claimants to the Second Defendant. The Second Defendant alleged that no machinery had been delivered and sought return of the purchase price which had been paid. The judgment of the Ethiopian Courts (after litigation which lasted some 7 years) was essentially in favour of the Second Defendant which obtained a judgment in their favour requiring the Claimants to pay $1,550,000. Appeals against that judgment were unsuccessful and the Second Defendant on 14th April 2003 requested execution of the judgment. That was effected by a sale of the Claimants’ shareholding in the Second Defendant which were sold for $54 per share on 30th April 2004. The Claimants allege it to be a sham auction.
As I have said there was extensive litigation in Ethiopia.
The Claimants contend however as I have said that the process was not fair. First the evidence of the Defendants’ was perjured and fraudulent. Second the Ethiopian Courts did not give them justice.
In my judgment I rejected their allegations about the unfairness of the Ethiopian Courts.
As regards the injustice two key matters survived the hearings. First there was the Inventory. This was an inventory of machinery at the Defendants’ premises. The Defendants in the Ethiopian proceedings successfully established that the machinery the Second Defendants paid for was never delivered which meant that there were payments for a failure of consideration. The Inventory was signed by a Mr Admassu on behalf of the Claimants (he did not give evidence) an