' The plaintiffs have filed applications under section 731 of the Sindh Chief Court Rules (O.S.) in this and the connected Admiralty Suit viz. Suit No,61, against the defendants (vessel) with the prayer to arrest the defendant's vessels presently available at Port Qasim, Karachi, until they furnish security in the sum of $US 48,8,820 and $ US 24,50,000 respectively in each suit.
2. The brief facts of the case are that the plaintiffs are engaged in providing finances/loan to ship owning companies for the purchase, maintenance and improvement of vessels. At the request of the defendant No,2, the plaintiffs granted a loan to the said defendants, being the owners of the vessel, in the sums as mentioned in the suits for the purchase, repairing and improvement of the defendant's vessel. Loan agreements were executed between the plaintiffs and the defendant No,2, being the owner of the vessel. The plaintiff disbursed the agreed loan amount and the defendant No,2 availed the full amount of loan. In terms of Loan Agreement the repayment of loan was to be made by the owners of the defendant's vessel by quarterly instalments.
3. It was specifically agreed upon between the parties to the Loan Agreement that in case of default the plaintiffs shall have first charge on the defendant's vessel but despite repeated demands and requests of the plaintiffs for repayment of the outstanding amount of loan the owners of the defendant's vessels failed and neglected in repayment of the amount. The plaintiffs President also has share of 33% in the said vessel and as such extension of repayment was granted liberally. A dispute arose between the parties and the President of the plaintiffs company was even refused access to the office and records of the defendant No, 2, it is claimed that the defendants are contemplating to sell/dispose of the defendant's vessels so as to deprive the plaintiffs of their lawful dues. Hence the suit under the Admiralty Jurisdiction of the Nigh Court.
4. The perusal of both the suits shows that by order dated 26-11-2002 the vessels were ordered to be arrested and directions were issued to the concerned authorities not to allow the vessels to leave the shores of Karachi Port without the due permission of this Court subject to their furnishing Bank guarantees in the sums of rupees mentioned in the order. In the alternate the defendants were directed to deposit the said amounts with the Nazir of this Court and once that would be done the vessels would be free to leave. Notices for compliance of that order issued to the defendants and a fix date viz. 28-11-2002 for hearing of application under rule 731 of SCCR (OS) was given. The Maritime Security Agency in compliance of this Court's order arrested the vessels.
5. After being served learned counsel for the defendants have filed counter-affidavit and stated that the suits have been filed illegally without any authority from the Board of Directors of the plaintiffs. The appointment of Mr. Muhammad Ali Aoun, under the power of attorney, is of no legal effect for filing of the present suits. It is further submitted that the Loan Agreements, executed between the parties is forged, fabricated and/or concocted and has been filed with mala fide intention. The counter-affidavit further claimed that the spelling of the name of Tefkros Papkyriakou has been wrongly and deliberately mentioned in the said agreements as Tefkros Papkyricou which fact also confirms the forgery committed by the plaintiffs on the defendants. Since the defendant No,2 was using a different seal, therefore, the seal affixed on the loan agreements by the signatory Mr. H. Galasharif is not the seal of the Company. Impression of original seal of the defendant No,2 has been affixed on the authority letter of the deponent which was attached with the Vakalatnama filed on behalf of the defendants. It is further pointed out through the counter-affidavit that under clause 3 of the Loan Agreement it was agreed that the loan amount would be repayable by quarterly instalments and first instalment shall become due and payable during the month of March, 1997. They further challenged the authenticity of the Loan Agreements by submitting that in terms of clause 3 of the agreements the alleged repayment date of loan was in March, 1997 while as per payments advices the plaintiffs debited said loan on 18-12-1998 and 29-1-1999 and further submitted that the vessel was purchased on 20-12-1996 and the first instalment was to be made in March, 1997. The President of the plaintiffs company has nothing to do with the business of the defendants as neither he was shareholder to the extent of 33% of share nor was he concerned in any manner. The defendants have also stated that the plaints of the suits are also forged because the plaintiffs have no office in Dubai and no licence to carry out any business has been granted to them by the Government authority of Dubai and all the documents filed with the plaints are forged and fabricated. Lastly they submitted that as per Financial Statement of Abdoun Oil and the related companies, duly audited by Messrs Price Waterhouse and Cooper, there is no entry of this outstanding loan and there was no mention of any loan amount in the audit done by the said Company. The defendants alongwith their counter-affidavits have placed on record a bunch of documents to authenticate their submissions.
6. I have heard the learned counsel for the parties and with their assistance have gone through the documents on which they rely.
7. At the very outset it would be sufficient to observe that the counsel for the defendants Nos,1 and 2 has assailed the order of arrest as well as the suit itself on several grounds. He has, however, raised two main issues, one is that the suit is patently barred by limitation and the second is that the claim is based on forged documents.
8. Counsel, in support of these contentions, has filed a detailed counter-affidavit alongwith annexures. Even in the counter-affidavit the thrust of the attack is on the fact that all the documents annexed to the plaint in support of the plaintiff's contentions are forged. It is noted by me that the loan agreement has been executed between the plaintiff and defendant No,2. The loan is supposed to have been given for the acquisition of the vessel. The loan agreement was supposed to have been executed in January, 1995 between the plaintiffs and the defendant No,2.
One gentleman has signed this agreement on behalf of defendant No,2 as a proxy of one Tefkros Papakyriacou. This loan agreement was executed in Dubai, UAE. This loan agreement pertains to Suit No,61 of 2002. In Suit No,62 of 2002 the same loan agreement has been relied upon and annexed. There are other documents which are relied upon and, therefore, annexed with the plaint.
They however, refer to an agreement dated 23-12-1996. These annexures are letters sent by the plaintiff and signed by Muhammad Ali Aoun in his capacity as President and addressed to several other companies. One letter is addressed to Tefkros Papkyriacou. One letter is addressed to two persons and on the other hand the reply has been given by Glaxy Maritime Enterprises, S.A.
Thereafter there is another letter by the same company, addressed to the plaintiff. There is a letter dated 8-5-1998, which has been addressed by the plaintiff to three persons. Once again a reply has been shown to have been received from Glaxy Maritime Enterprises, S.A. From these documents it is clear that an exchange of letters has been made but no where does it show that the defendant No,2 has admitted liability to pay the loan amount to them. The plaintiffs have produced several invoices, the originals of which have been produced by Mr. Naim Ahmed, learned counsel for defendants Nos,1 and 2. Subject to its final determination through evidence it is clear on a plain comparison that there is a difference between the originals and the copies.
9. Learned counsel for the defendant through statements has also produced documents in Spanish as well as English translation and certificates of incorporation to try and show not only the names of persons who were in the year 1995 shareholders of the defendant No,2Company but also that the company itself i,e, defendant No,2 came into existence after January, 1995. The plaintiffs have also brought several documents by way of affidavit-in-rejoinder. They have brought on record photocopy of proxy and some minutes of the Board of Directors of the plaintiff's company. It is interesting to note that according to the plaintiff Muhammad Ali Aoun is also a Director in the defendant No,2-Company as well as the Assistant Secretary. In the same way he is the President- Director of the plaintiff's company. A forensic audit report in connection with several shipping companies and ships has also been placed on record. From the whole set of other documents that have been placed on record including a document which was faxed which is apparently pertaining to Judicial Council of the Athens Court of Appeal. The defendant No,1 has also produced a document which is a fax which shows that a dispute between the partners has been taken before the High Court of Justice Queen's Bench Division Commercial Court in England.
10. A letter dated 12-12-2002 has been produced by Jenga Shipping Company Limited through their counsel where they have admitted full liability. A cursory look at the signatures compared to the signatures available on the record shows that it has been signed by one and same person.
11. I am, therefore, convinced that prima facie no case has been made out for confirmation of arrest ordeRs, Parties are obviously litigating all over the world and there is no doubt in my mind that each side is trying to gain an advantage over the other.
12. Above are the reasons of my short order, dated 20-12-2002, by which I had dismissed the application under rule 731 of Sindh Chief Court Rules (OS).
Arrest of vessel not confirmed.