Lawyer Philip Nyachoti for proprietors of Maxam, Modern Lane and Olepasu Tanzania Limited’s paying attentions to Justice Eric Ogola while delivering a ruling that stopped from ending a multi- billion shilling contract with local distributors on Tuesday April 21, 2016.
BY SAM ALFAN.
International beer maker, Heineken East Africa Import Company limited has been stopped from ending a multi- billion shilling contract with local distributors.
Justice Eric Ogola said in his ruling that a notice purportedly terminating Maxam Limited, Modern Lane and Olepasu Tanzania Limited’s contract lacks evidential material and is against an agreement made between the parties.
The judge said the pending the hearing and determination of the dispute both notice dated 27 January 2015 and the letters of appointments shall not be executed.
He also directed that the matter be mentioned on May3 2016 for further directions.
The proprietors of Maxam, Modern Lane and Olepasu Tanzania said that Heineken has issued a notice to through Heineken International B.V to terminate their contracts for the distribution of its products in Kenya, Uganda and Tanzania.
Through their lawyer Philip Nyachoti, the distributors told the court that the intended action is made in bad faith considering the huge investment they had made to ensure compliance of their agreement signed in 2013.
Mr Nyachoti said that the notice issued on January 27 2016 by Heineken International goes against the spirit of the agreement by parties.
He told Judge Ogola, that if the decision is enforced it will be in blatant breach of the agreement and appointments, as the defendants companies have also demanded payment of 450 Euros that was payable by February 10 2016.
The lawyer also said the notice demands that if the money is not paid by the date indicated, the agreement and appointments will stand withdrawn.
“The move is unlawful, unprocedural, irregular and contrary to the contracts so entered. The distributors have made massive investment to ensure Heineken brands are distributed as agreed to the three East African countries,” he said.
He told the court that his clients, the distributors had to enter into contracts with third parties to ensure availability of proper equipment for the distribution of Heineken products. “If the notice is executed my clients will suffer huge financial losses having made a turn-over of Sh1.9 billion in 2015 and Sh1.4 billion in 2014.”
Mr Nyachoti said that the profitability of the defendants has increased tremendously, but now they intended to unfairly and selfishly terminate the distribution agreements and appointments so to give to other parties.
The lawyer also argued that in any event the purported termination notice had both financial and legal consequences on the third parties contracted by the distributors.
The third parties have been contracted to carry our warehousing, delivery and transport Lorries and other vehicles for the operational plan.
The lawyer as a consequence asked the court, to issue restraining orders and an injunction stopping that intended termination of contracts and agreement pending the hearing and determination of the suit.
He further urged the judge to direct that Heineken should not appoint parties to perform their contracts and agreements as entered by parties.
The High Court will deliver its Judgment on April 22 2016.
