Fortune News | Feb 02,2019
A judge at the Federal High Court has ordered an injunction on the ongoing construction of a restaurant and an open-air cinema inside the Ghion Hotel premises in Addis Abeba.
The latest ruling put another turn last week in the legal battle between the Ghion Hotels Enterprise and Das Engineering & Innovation Plc, the latter co-established by a local filmmaker, Tewodros Teshome, along with Surafel Worku.
Das Engineering began the construction on a 5,000sqm of land after winning a bid the Enterprise put out in June 2019. One of two bidders, it was awarded a contract for a 10-year lease with 400,000 Br in monthly rent. Less than a year later, Ghion's management terminated the contract, alleging that Das Engineering had defaulted on its rent for three months beginning March 2020, amounting to 1.75 million Br.
Das began legal proceedings against Ghion Hotels Enterprise at the Federal High Court in February 2021, claiming an unlawful breach of contract. The legal team of Das Engineering argued that the contract between their client and the Hotel included a clause exempting Das from paying rent if construction is halted due to external factors beyond the control of both parties.
The company alleged the six-month state of emergency declared in March 2020 due to the COVID-19 pandemic prevented it from undertaking construction works. Ghion Hotel, which was established in 1951 and sits on a 123,000sqm plot in a prime location of the capital, was used as a quarantine centre shortly after the state of emergency was declared. Lawyers of the plaintiff also blamed the managment of the Enterprise for defaulting on an agreement to let their client host a 12-day expo on the premises in January 2021 after the company issued a four million Birr cheque, which it later blocked.
Ghion's legal representatives pleaded for the suspension of the construction project and appealed to judges to order Das Engineering & Innovation to unblock the cheque. Judges at the High Court ruled that the construction works have no relation to the litigation, and rejected Ghion’s appeal for clearing the cheque.
Ghion's lawyers took the case to the Supreme Court.
Justices at the Supreme Court overturned the High Court's ruling in October this year, allowing Ghion to take the case back to Federal High Court and appeal against the construction project on its premises. Judges at the Federal High Court, second civil bench, presided over the case on December 14, 2021.
Lawyers representing Das Engineering & Innovation, Million Assefa Mersha Law Office, requested an adjournment as some witnesses had not appeared in court. Judge Seble Kinfe, who presided over the case, dismissed Das' request for an adjournment and ordered the company to pay 5,000 Br as compensation of travel expenses witnesses brought by the plaintiff incurred. The Judge also issued an injunction against the construction works on the Hotel premises until the next court date set for January 10, 2022.
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