Business / Companies
Chinese company fights Chiadzwa eviction
03 Mar 2016 at 00:28hrs | Views
ANJIN Investments Private Limited says the recent forced shut down of its diamond mining operations and eviction from the mining site in Chiadzwa was a breach of the Chinese shareholders' rights protected in terms of the Agreement on the Encouragement and Reciprocal Protection of Investments between the governments of Zimbabwe and China.
In an urgent chamber application filed at the High Court yesterday, Anjin argued that the Ministry of Mines and Mining Development and the police did not follow due process in evicting the company from Chiadzwa and that in terms of the agreement signed by the two countries, such conduct was unacceptable.
This comes as the government was yesterday allowed to lead evidence to show why it was impossible to comply with a court order for Mbada Diamond Private Limited's personnel to return to Chiadzwa to secure its diamonds and equipment pending determination of the dispute between the firm's Mauritius-based shareholder Grandwell Holdings and the government of Zimbabwe.
The government said certain security checks needed to be done on Mbada personnel before they were allowed back at the site.
A request was made during the hearing of the urgent application by Grandwell Holdings to evict the Ministry of Mines and Mining Development and representatives of the ZMDC, Marange Resources and the Zimbabwe Consolidated Diamond Company (ZCDC) from the mining site.
Anjin Investments becomes the second diamond company to seek the intervention of the High Court after the government ordered all diamond companies to stop operations following their refusal to join the ZCDC.
Anjin cited Minister of Mines and Mining Development Walter Chidhakwa, Minister of Home Affairs Ignatius Chombo and Commissioner-General of Police Augustine Chihuri as respondents to the application in their official capacities.
In the application filed by Hussein Ranchod and Company yesterday, Anjin is seeking an order quashing the notice for their eviction and shut down of operations in Chiadzwa.
The company also seeks to prevent the police from disturbing mining operations in Chiadzwa.
In a founding affidavit deposed by Anjin director Zhang Shibin, the company said it had invested more than $100 million in the project and it employed thousands of locals.
"The rights of a Chinese entity that holds shares in Anjin as protected in terms of the government of Zimbabwe and China were violated by the recent developments in Chiadzwa.
"One of the applicant's shareholders is a Chinese entity whose rights are protected in terms of the Agreement between the Government of the People's Republic of China and the Government of the Republic of Zimbabwe on the Encouragement and Reciprocal Protection of Investments.
"In terms of the agreements, no expropriation or similar measures against an investor's rights in Zimbabwe may be taken without following due process and against payment of compensation," said Shibin.
Anjin contends that the process was illegal in that the government did not allow them to make representations on the issue to the permanent secretary (in the Mines and Mining Development Ministry) as per agreement.
The company argued that the government's process was flawed in several respects.
"The decision to invest was based on the representations made by the first respondent (Mines and Mining Development Ministry) which issued the special grants and applicant's expectation was that the special grants would remain valid for as long as mining operations were viable to recoup the investment made by it, to adequately develop and work the large hectares covered by the mining claims," reads the affidavit.
Anjin said the shut down has caused loss of business to it at a time when workers and other creditors were anticipating payments. The matter is yet to be set down for hearing at the High Court.
In the Mbada case yesterday, Grandwell Holdings lawyer Sternford Moyo had raised a preliminary point accusing Mines and Mining Development Minister Chidhakwa of approaching the court with dirty hands because he defied the court order on Monday allowing Mbada Diamonds' personnel together with its chain of command to go back to site.
He argued that Minister Chidhakwa should purge himself first before he is heard on merit.
Moyo also argued that the Minister flagrantly defied the order and went public about his intention to defy the court order.
But High Court judge Justice Joseph Martin Mafusire granted the request by the government saying it would not prejudice Grandwell, as the court needed to get sufficient facts on the matter and make an appropriate decision on the matter.
"In my considered view it is important that evidence on the ground be heard as to whether or not there was compliance with the order I issued on February 29 and if not whether there were any reasonable reasons or impossibilities for not complying with the order," said Justice Mafusire.
"Therefore, the application to lead evidence solely on whether or not the order was not complied with is hereby granted."
Justice Mafusire also ruled that the law was clear that the party that approaches the court with dirty hands was not entitled to be heard.
"In my view where there is defiance of a court order I liken it to a red flag being waved in front of a bull," he said. "The integrity of the court should not be compromised. If an order has been granted it must be obeyed, but I'm told by the second to fourth respondent (ZCDC) that there was no such intention to disobey the order but certain security checks had to be made before the order could be complied with."
Justice Mafusire, however, said it was important to allow the government to lead evidence, as it seeks to prove that it was not in contempt of court. The government said Mbada refused to be cleared for them to go back on site. However, Mbada that was being represented by Advocate Thabani Mpofu, argued that it holds cleareance certificates and it did not need clearance.
The applicants are also entitled to call their witnesses to rebut what the government witnesses would say.
Grandwell Holdings and Marange Resources entered into a joint venture mining partnership in which the two held 50 percent each some seven years ago.
A diamond joint venture company, Mbada Diamonds, was formed which carried out diamond mining activities in the Chiadzwa area in terms of the set conditions.
Mbada, among other diamond firms, was given 90 days to remove its equipment and other assets from the site.
The company is seeking restoration of its full control, peaceful and undisturbed possession of the mining site. Grandwell Holdings holds 50 percent of the issued share capital of Mbada while the remaining 50 percent is held by Marange Resources, which is wholly owned by ZMDC.
Adv Lewis Uriri acted for the Minister, while Adv Sylvester Hashiti represented ZMDC, Marange Resources and ZCDC.
In an urgent chamber application filed at the High Court yesterday, Anjin argued that the Ministry of Mines and Mining Development and the police did not follow due process in evicting the company from Chiadzwa and that in terms of the agreement signed by the two countries, such conduct was unacceptable.
This comes as the government was yesterday allowed to lead evidence to show why it was impossible to comply with a court order for Mbada Diamond Private Limited's personnel to return to Chiadzwa to secure its diamonds and equipment pending determination of the dispute between the firm's Mauritius-based shareholder Grandwell Holdings and the government of Zimbabwe.
The government said certain security checks needed to be done on Mbada personnel before they were allowed back at the site.
A request was made during the hearing of the urgent application by Grandwell Holdings to evict the Ministry of Mines and Mining Development and representatives of the ZMDC, Marange Resources and the Zimbabwe Consolidated Diamond Company (ZCDC) from the mining site.
Anjin Investments becomes the second diamond company to seek the intervention of the High Court after the government ordered all diamond companies to stop operations following their refusal to join the ZCDC.
Anjin cited Minister of Mines and Mining Development Walter Chidhakwa, Minister of Home Affairs Ignatius Chombo and Commissioner-General of Police Augustine Chihuri as respondents to the application in their official capacities.
In the application filed by Hussein Ranchod and Company yesterday, Anjin is seeking an order quashing the notice for their eviction and shut down of operations in Chiadzwa.
The company also seeks to prevent the police from disturbing mining operations in Chiadzwa.
In a founding affidavit deposed by Anjin director Zhang Shibin, the company said it had invested more than $100 million in the project and it employed thousands of locals.
"The rights of a Chinese entity that holds shares in Anjin as protected in terms of the government of Zimbabwe and China were violated by the recent developments in Chiadzwa.
"One of the applicant's shareholders is a Chinese entity whose rights are protected in terms of the Agreement between the Government of the People's Republic of China and the Government of the Republic of Zimbabwe on the Encouragement and Reciprocal Protection of Investments.
"In terms of the agreements, no expropriation or similar measures against an investor's rights in Zimbabwe may be taken without following due process and against payment of compensation," said Shibin.
Anjin contends that the process was illegal in that the government did not allow them to make representations on the issue to the permanent secretary (in the Mines and Mining Development Ministry) as per agreement.
The company argued that the government's process was flawed in several respects.
"The decision to invest was based on the representations made by the first respondent (Mines and Mining Development Ministry) which issued the special grants and applicant's expectation was that the special grants would remain valid for as long as mining operations were viable to recoup the investment made by it, to adequately develop and work the large hectares covered by the mining claims," reads the affidavit.
Anjin said the shut down has caused loss of business to it at a time when workers and other creditors were anticipating payments. The matter is yet to be set down for hearing at the High Court.
In the Mbada case yesterday, Grandwell Holdings lawyer Sternford Moyo had raised a preliminary point accusing Mines and Mining Development Minister Chidhakwa of approaching the court with dirty hands because he defied the court order on Monday allowing Mbada Diamonds' personnel together with its chain of command to go back to site.
He argued that Minister Chidhakwa should purge himself first before he is heard on merit.
Moyo also argued that the Minister flagrantly defied the order and went public about his intention to defy the court order.
But High Court judge Justice Joseph Martin Mafusire granted the request by the government saying it would not prejudice Grandwell, as the court needed to get sufficient facts on the matter and make an appropriate decision on the matter.
"In my considered view it is important that evidence on the ground be heard as to whether or not there was compliance with the order I issued on February 29 and if not whether there were any reasonable reasons or impossibilities for not complying with the order," said Justice Mafusire.
"Therefore, the application to lead evidence solely on whether or not the order was not complied with is hereby granted."
Justice Mafusire also ruled that the law was clear that the party that approaches the court with dirty hands was not entitled to be heard.
"In my view where there is defiance of a court order I liken it to a red flag being waved in front of a bull," he said. "The integrity of the court should not be compromised. If an order has been granted it must be obeyed, but I'm told by the second to fourth respondent (ZCDC) that there was no such intention to disobey the order but certain security checks had to be made before the order could be complied with."
Justice Mafusire, however, said it was important to allow the government to lead evidence, as it seeks to prove that it was not in contempt of court. The government said Mbada refused to be cleared for them to go back on site. However, Mbada that was being represented by Advocate Thabani Mpofu, argued that it holds cleareance certificates and it did not need clearance.
The applicants are also entitled to call their witnesses to rebut what the government witnesses would say.
Grandwell Holdings and Marange Resources entered into a joint venture mining partnership in which the two held 50 percent each some seven years ago.
A diamond joint venture company, Mbada Diamonds, was formed which carried out diamond mining activities in the Chiadzwa area in terms of the set conditions.
Mbada, among other diamond firms, was given 90 days to remove its equipment and other assets from the site.
The company is seeking restoration of its full control, peaceful and undisturbed possession of the mining site. Grandwell Holdings holds 50 percent of the issued share capital of Mbada while the remaining 50 percent is held by Marange Resources, which is wholly owned by ZMDC.
Adv Lewis Uriri acted for the Minister, while Adv Sylvester Hashiti represented ZMDC, Marange Resources and ZCDC.
Source - chronicle
