DUBAI-based Rental Solutions and Services LLC (RSS) has filed a suit against Symbion Tanzania Limited, demanding, among others, payment of a total of 228,070,655.67 US dollars (over 560bn/-), being compensation and total outstanding amount of rental charges for its power generators.
According to the plaint originating from
the suit filed in the High Court in Dar es Salaam last week, the
28,070,655.67 US dollars is an outstanding amount rental charges while
the 200 million US dollars is compensation for the loss RSS, the
plaintiff, allegedly suffered.
The plaintiff has also sued the Tanzania
Electric Supply Company (TANESCO), the state owned electric supply
company, as necessary party who will be affected by the grant of the
orders sought by the Plaintiff herein, if any.
RSS is, thus, seeking for an order,
directing TANESCO to deduct from the outstanding receivables TANESCO
owes Symbion and remit the same directly to RSS for settlement of the
total liability.
The demanded charges arise from the
supply, installation, commissioning and operation of power generating
equipments (Power Plants), which RSS rented to Symbion Tanzania Limited
(Symbion) towards the Tanzania-TANESCO project for the generation and
supply of electric power to the National Grid.
In the suit, the plaintiff seeks a
declaration that failure by Symbion, the first defendant, to pay the
rental charges as per the terms agreed upon by the parties, constituted
fundamental breach of the contractual terms and hence was unlawful and
unwarranted.
The plaintiff further sues Symbion for
an order directing the latter to indemnify him against all claims by
third parties connected with and incidental to the failure or stoppage
of payments of the agreed rental charges.
He also seeks specific and general
damages, interests and costs of the suit. It is alleged that from
September 2011 to June 2013, the plaintiff entered into various rental
agreements and extensions thereof, with Symbion for the supply,
installation, commissioning and operation of power generating equipments
for its project to supply power to the national grid.
On September 21, 2011, the plaintiff
allegedly entered into an Independent Power Plant (“IPP”) Rental
Agreement with Symbion, the 1st Defendant, for the supply, installation,
commissioning and operation of power generating equipments of 50 MW at
33kV at TANESCO’s Zuzu substation in Dodoma.
The plaintiff claims that such IPP was
on a monthly rental charges worth 1, 374, 500 US dollars and that the
agreement was for a minimum duration of six months.
The total rental amount, which was
supposed to be paid by Symbion in respect of the agreement for such
period, was 8,247,000 US dollars. It is claimed in the plaint that the
plaintiff out-rightly performed its obligation as conditioned in the
scope of supply of the agreement.
“Invoices for the amount claimed were
raised monthly pursuant to the terms of the agreement whereby the
defendant was required to effect payments within 30 days from the day
invoices were issued,” states a paragraph in the plaint of the suit.
On February 12, 2012, the plaintiff
entered into an agreement for the supply, installation, commissioning
and operation of power generating equipments of 55MW at 33kV on a rental
basis for duration of 12 months worth 1,666, 000 US dollars per month.
Such transaction was to be carried out
at the 2nd Respondent’s Emergence Power Project sites located in Arusha
and Dodoma, whereby power plants with 50 MW were to be installed at
Arusha and 5MW at Dodoma sites.
It is stated that on additional
agreement, parties agreed that, invoices should be presented by the
plaintiff at the end of each month and thereafter payment to be settled
by the first defendant within 30 days.
The plaintiff out-rightly allegedly
complied and presented the invoices accordingly. According to the plaint
of the suit, there were other extensions of contracts for continued use
of the supplied and installed power plants in Dodoma and Arusha
stations whereupon Rental Solutions performed its obligations and issued
the invoices to Symbion for payments of the rental charges.
“Despite the plaintiff having had
out-rightly performed all obligations as per the agreements and issuing
the invoices as conditioned in the scope of supply therein, out of the
total outstanding sum of 77,667,666.28 US dollars, Symbion has only paid
the plaintiff 49,597,010.61 USD.
“To this day, without any justifiable
reason, the first defendant has deliberately defaulted to honour the
agreements and neglected to pay an outstanding amount of 28,070,655.67
USD,” claimed Rental Solutions and Services LLC.
It is stated further that due to
Symbion’s default or stoppage of and remit the same, the plaintiff
suffered huge loss of profit for failure to utilize the outstanding
amount which was obtainable from the rental payments and ought to be
paid by the first defendant for agreed period.
The plaintiff entered into several
contracts with various third party companies for hire of the power
generation equipments to distribute to the defendant on promise that
Symbion would timely settle the rental charges upon being paid by
Tanesco.
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