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ICC Tribunal Dismisses Micheletti's Arbitration Against Ghana Over Accra Sports Stadium Rehabilitation
Introduction:
The International Chamber of Commerce (ICC) Tribunal has dismissed an arbitration case filed by Micheletti Company Limited against the Government of Ghana. Micheletti sought damages for breach of contract related to the rehabilitation of the Accra Sports Stadium. The Tribunal's decision, delivered in May 2023, centred on jurisdictional issues and the statute of limitations under Ghanaian law.
Background of the Dispute:
In April 2006, the Government of Ghana signed an agreement with Waterville Holdings (BVI) Limited to rehabilitate several sports stadiums, including the Accra Sports Stadium, El-Wak Stadium in Accra, and Baba Yara Sports Stadium in Kumasi, in preparation for the 2008 African Nations Cup. Micheletti Company Limited was subcontracted to handle the Accra Sports Stadium's rehabilitation, while Consar Limited was responsible for the Baba Yara Sports Stadium. However, the government terminated the agreement on August 1, 2006, citing the lack of Cabinet approval. Despite this, negotiations ensued, allowing Micheletti and Consar to continue their respective projects. The government certified and paid for the work completed. The arbitration initiated by Micheletti in 2023 pertained to claims that the government had not honoured some of its obligations, including special damages of $400,000 and interest from February 2009.
Legal Objections and Jurisdiction:
The Office of the Attorney-General of Ghana raised preliminary legal objections under Article 5(1) of the ICC Rules of Arbitration. Assistant State Attorney, Anne-Marie Ayanru, argued that Micheletti had not exhausted the dispute resolution procedures stipulated in the FIDIC General Conditions of Contract, which required initial submission to a Dispute Adjudication Board (DAB). Therefore, the ICC Tribunal allegedly lacked jurisdiction. Additionally, the attorney general contended that Micheletti’s claim was statute-barred. Under Ghana’s Limitation Act, 1972 (NRCD 54), the claimant was required to initiate any dispute resolution mechanism within six years of the cause of action, which occurred on May 19, 2009.
Tribunal's Decision:
The ICC Tribunal, comprising President Sadaff Habib and members Shadrack Arhin and Justin Amenuvor, agreed to bifurcate the proceedings to address the jurisdictional and statute-barred issues first. Upon reviewing the arguments, the Tribunal determined that it had jurisdiction to hear the case. It found that Micheletti had attempted to notify the government of its intention to refer the dispute to a DAB before commencing arbitration, but these efforts were ignored by the government. Despite affirming its jurisdiction, the Tribunal upheld the government's argument that the claim was statute-barred. The action, initiated in 2023, was filed well beyond the six-year limitation period allowed by Ghana’s Limitation Act. As such, the Tribunal dismissed Micheletti’s claims in their entirety.
Conclusion:
The ICC Tribunal's dismissal of Micheletti’s arbitration claim underscores the critical importance of adhering to procedural and statutory requirements in international arbitration. The decision highlights the necessity for claimants to act within prescribed time limits and exhaust preliminary dispute resolution mechanisms. The Tribunal is now considering submissions regarding the costs to be awarded in favour of the Government of Ghana following the dismissal of the claim. This ruling provides a significant precedent for future arbitration cases involving breach of contract claims and reinforces the legal framework governing such disputes in Ghana.
Tags : #ICCArbitration #GhanaLaw #MichelettiCompany #AccraSportsStadium #ConstructionDispute #InternationalArbitration #LimitationsAct #FIDICContracts
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