Wednesday, 10 October 2012

Argentina Vessel Saga Battle Rages in Court,

By Felix Engsalige Nyaaba
The Commercial Division of the Accra High Court, yesterday fixed Thursday October 11, to give its ruling on whether the court can invoke its own jurisdiction and set aside an interlocutory injunction it granted for the confiscation of Argentina Naval Vessel, following a judgment debt owed to NML Capital Limited, an international funding company and commercial creditor to the Argentina government.
The presiding judge, Mr. Justice Richard Adjei Frimpong, fixed the date after he had received written submission of case and verbal legal argument by both counsel in the case.
According to the judge, the case has an international interest, as it involves a sovereign state and that the court would study the respective arguments and statement of case by the parties and gives its ruling on Thursdays October 11, 2012.
The ruling by the High Court would determine as to whether or not the court can invoke its original jurisdiction and set aside the interlocutory injunction for the seizer of the Argentina Military vessel on Ghana’s territorial waters.
The court on October 2, this year granted an interlocutory injunction brought by NML Capital Limited, for the confiscation of the Argentina Naval vessel, following a judgment debt the Argentina government owed in excess amount of US$280 million plus interest.
The orders by the Ghana’s High Court was in relation with an earlier orders  granted by United Kingdom and United State courts in favour of the NML Capital Limited, which therefore open the flood gate for  similar suit in Ghanaian court.
The Ghana High court orders requires the vessel , the  Ara Libertad to remains on Ghana’s territorial waters at Tema , till the final determination of the case in court  for the enforcement of the judgment debt against the Argentina government by the United state District Court for the Southern District of New York  as well as similar court judgment in UK.
But in an application for an order to set aside the interlocutory injunction and interim preservation of Ara Libertad vessel, the Argentina government said, the injunction granted by the Ghana’s High court was illegal, for in its view the republic of Argentina is a sovereign state and has a diplomatic immunity and that it naval vessel could not be confiscated in Ghana.
In his legal argument, counsel for the Argentina government, Mr. Larry Otu, said the Vessel was in Ghana on a diplomatic mission and has such immunity covering it and that the injunction granted against the government of Argentina was palpably contrary to the international laws and that of the United Nations Law of the Sea on state property and immunity (2004).
He contended that, the bond purchased and signed under the Fiscal Agency Agreement (FAA), between the plaintiff and the defendant, was on assets and property of the government within its jurisdiction with limitations that can be confiscated, but not those assets outside it boundaries and that the court has erred in granting the interlocutory injunction for the seizer of its vessel in Ghana.
According to Counsel, per the Fiscal Agency Agreement, the diplomatic waiver of the defendant asset was limited to its diplomatic mission assets in other countries, but not its security or military assets ands that the vessel was in Ghana under an invitation of the Ghanaian Military to assist in training of officers and that could not be attach as property of the defendant to defray the debt owed by the government of Argentina.
Counsel argued that, the Ghana’s High court has erred in granting the interlocutory injunction, confiscating the Ara Libertad, for in his view the United Kingdom and New York District Courts orders was directed on the defendant assets on diplomatic mission, but not on security assets and that the injunction must be set aside for it has no legal bases.
But counsel for the plaintiff, Mr. Ace Ankomah, opposed the application to set aside an order of interlocutory injunction and interim preservation of Ara Libertad to be set aside.
According to counsel, per the Fiscal Agency Agreement (FAA), the defendant, expressly and irrevocably agreed not to waiver any immunity from pre-judgment and execution attachment of any of its assets and properties.
Counsel said the orders of the interlocutory injunction and the interim preservation of the Ara Libertadvessel, are orders that were anticipated and agreed to by the two parties and that the court has not breach any law.
He contended that, although the United Nations Convention on the Law of the Sea recognizes the immunity of warship, that recognition was based on the rules and principles of customary international law which permit the immunity to be waived.
He argued that  the defendant does not enjoys any immunity under the terms of the United Nations Convention on jurisdictional immunities of states and their properties (2004) as neither the defendant nor Ghana has ratified that in its statutory laws.
Mr. Ankomah  added that , although the defendant provided limitation to its irrevocable waiver of immunity under the Fiscal Agency Agreement (FAA), it chose to apply that limitation to only specific property located in Argentina, and that the Naval Vessel is excluded since it was not located at Argentina but on the Tema port of Ghana.
He therefore vehemently opposed to the application to set aside the interlocutory injunction, inviting the court to dismiss the application, saying it was in the contrary to the FAA and the United Nations Convention Law of the Sea on which the bonds and securities was purchased upon.
The case of the plaintiff is that the defendant entered into a Fiscal Agency Agreement dated October 19, 1994 with the Bankers Trust Company and issued securities and bonds for the purchase by the general public.
According to the facts, plaintiff purchased two series of  bonds issued by the defendant , including 12%Global Bonds  which was  authenticated on February 3, 2000 and another 10.25% Global Bonds which  also authenticated on July21,2000, but the defendant failed to fulfilled the bonds after it authentication.
The legal action in Ghana per the facts is one among several of courts actions brought by private creditors around the world seeking to recover their loans.
Argentina is allegedly to have had notorious reputation for consistently ignoring international courts and international creditors that have won more than 100 court judgements against the government, but the country has refused to redeem those judgments.
More than a decade after the Argentina committed the largest sovereignty default in history; the country has since accumulated more than US$45 billion in foreign exchange reserves, yet has failed to resolve its overdue debts to the numerous bondholders and lenders.
The confiscated Libertad Vessel is used for training Seamen from Argentina and other countries. It was launched in 1956 and has overall length of nearly 104 meters and Tema is one of more than a dozen ports where the Ara Libertad plans to calling for training and supplies in its six-month circumnavigations of the Atlantic Ocean.

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