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LAP wins appeal against $15 million Catalyst ruling in London

bySami Zaptia
May 28, 2016
Reading Time: 3 mins read
A A

By Sami Zaptia.

LAP yesterday won its London High Court  appeal against the $15m ruling to CMS (LOGO: LAP).
LAP yesterday won its London High Court appeal against the $15m ruling to CMS (LOGO: LAP).

London, 18 May 2016:

The Libya Africa Investment Portfolio (LAP/LAIP) has won its appeal against the US$ 15-million London . . .[restrict]court ruling in favour of Catalyst Management Services (CMS).

The decision made yesterday at the High Court in London reverses the 17th July 2015 ruling by Master Kay QC.

In reaching the conclusion that the “summary judgment has now gone,” Mr Justice Burton noted that

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“The re-activation agreement [dated 5 August 2010] was not relied on in [CMS’] original Particulars of Claim [dated 21 September 2012]. Even in the Amended Particulars of Claim [dated 31 July 2015] it is apparently not relied on as a continuing agreement. And it is not mentioned in contemporaneous correspondence, for example, [CMS’ complaint dated 29 August 2010 to the Ministry of Inspection and Control].”

“There is inconsistent evidence, at the moment, as to who drafted the re-activation agreement.”

“There is then, of course, the dispute as to Mr Shushan’s authority, with regard to the validity of the re-activation agreement. He is 23 years old, and he is not a senior employee.”

“It is one of the terms of the [Settlement Agreement dated 26 August 2010] that all documents, under clause 4, be destroyed, which on the face of it looks like a termination of all arrangements between the parties.”

“[LAIP] will, in any event, have the opportunity to refer to clause 10.2 [of the MDTSA] which would, on the face of it, cut down the [$] 500 million [claimed by CMS] very considerably.”

On the basis of the above, the summary judgement was set aside in its entirety.

Commenting yesterday on the ruling, Ahmed Kashadah LAIP’s Managing Director, said “LAIP is delighted that as a result of its appeal, Master Kay QC’s summary judgment has been overturned in its entirety and LAIP`s money will remain with the court’’.

‘’Now that this important issue is resolved, LAIP is committed not only to defeating at trial the entirety of CMS’ claims, which from the outset it has consistently said are without foundation or merit, but also pursuing all of its rights and ensuring accountability’’.

‘‘In this regard, we continue to rely on the judicial process to protect LAIP’s assets from abuse, from both internal and external forces, who have sought to leverage the current instability that prevails in the country to the detriment of the fund.”

It will be recalled that LAP appealed the 15th July London High Court ruling ordering it to pay CMS, a service provider, US$ 15,422,924 with respect to alleged outstanding invoices.

On 21 September 2012, CMS had issued a claim against the LAP in the High Court, London. CMS had carried out management services for LAP in 2009/10.

In August 2010, disappointed with CMS’s performance, LAP, in its view, lawfully terminated CMS’s engagement. More than two years after the termination of the engagement, CMS claimed various sums from LAP, including US$ 15,422,924 in relation to alleged outstanding invoices, and more than US$ 525 million  in damages for alleged wrongful termination. LAP denies CMS’s claims entirely.

In August 2014, a further two years after the claim was issued, CMS applied for summary judgment with respect to the part of its claim relating to the alleged outstanding invoices.

The summary judgment application was heard before Master Kay, sitting in the Queen’s Bench Division of the High Court in London.

On 15 July 2015, Kay ordered LAP to pay to CMS US$ 15,422,924 with respect to the alleged outstanding invoices.

Whilst recognizing the present difficulties in Libya, Kay had placed importance on the fact that, as at the date of the summary judgment hearing, LAP had been unable to procure direct evidence from LAP personnel who dealt with CMS during the relevant period.

Accordingly, Kay had held that LAP had no real prospect of successfully defending the claim with respect to the alleged outstanding invoices. LAP, however, had rejected Kay’s decision, both in terms of the findings of fact made (which were based solely upon the uncorroborated evidence advanced by CMS’s witnesses) and by reference to the relevant legal principles which apply to summary judgment cases.

As a result, LAP had revealed that it intended to appeal the summary judgment decision at the earliest opportunity.

Kay’s judgment has no bearing on the remainder of CMS’s claim for damages for alleged wrongful termination, which is to be determined by way of full trial at a later date, and in relation to which LAP denies that any sums are due. [/restrict]

Tags: CMS Catalyst Management ServicesLAP LAIP Libya Africa Investment PortfolioLondon High Court

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