Court rules for SacOil in $2m claim
The Supreme Court of Appeal’s decision to dismiss Identiguard’s claim of $2m against a SacOil subsidiary should bring the dispute between the two companies to an end, SacOil CEO Robin Vela said yesterday.
The judgment is a victory for SacOil. A court order forcing SacOil to pay Identiguard would have been a financial setback because SacOil has already paid a $2m signature bonus to the Democratic Republic of Congo. A signature bonus is a payment made by a company to a government when it signs an exploration or production contract.
In February 2003, the South Gauteng High Court granted Identiguard a judgment against the Congo government for the payment of $576000 and $1,4m, with interest. In partial execution of that judgment, Identiguard sought to attach the payment of the $2m supplementary signature bonus under a production-sharing agreement concluded between SacOil subsidiary SacOil Pty and the Congo for the Block 3 oil block.
Just more than a year ago, the South Gauteng High Court delivered a judgment in favour of Identiguard and authorised the notice of attachment. SacOil then took the matter to the Supreme Court of Appeal.
“SacOil is pleased to inform shareholders that the appeal by its subsidiary, SacOil Pty, against the judgment delivered in May 2011 by the South Gauteng High Court in favour of Identiguard was successful. The appeal was heard by the (Supreme Court of Appeal) on May 15 2012 and judgment was delivered on May 31 2012”, SacOil said on Wednesday.
The appeal court overturned the high court order and replaced it with an order dismissing Identiguard’s application with costs, SacOil said. Mr Vela said yesterday Identiguard targeted SacOil because of the $2m signature bonus meant for the Congo government.
“This was never a matter between SacOil and Identiguard. It is a matter between the (Congo) government and Identiguard. We are glad to see the end of this,” he said.
Before the Supreme Court of Appeal hearing, Identiguard had launched an application requesting the South Gauteng High Court not to allow the judgment granted in its favour to remain suspended, pending the appeal, but instead to order SacOil Pty to pay the $2m into Identiguard’s attorney’s trust account. The South Gauteng High Court heard the application on March 20 and judgment was reserved.
“Bearing in mind that the (Supreme Court of Appeal) appeal has since been heard and was successful, SacOil Pty’s Norton Rose Incorporated, the attorneys acting on SacOil Pty’s behalf, have sent a copy of the appeal judgment to the South Gauteng High Court and have submitted that in the circumstances, the application in terms of rule 49(11) should also be dismissed with costs,” SacOil said.
Meanwhile, Mr Vela said, SacOil was evaluating options for its manganese plant in Mpumalanga, though it was not part of SacOil’s growth strategy, which involved buying oil and gas assets.
SISEKO NJOBENI (BusinessLive)
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