CP is Broke!
...¢18 Billion Debt Owed Oil Company Construction Pioneers (CP), the company with a pedigree of standard, quality work is broke, at least, for now. When yesterday morning they appeared before the judges of Ghana's Appeal Court, it was the picture of a pauper before a Shylock moneylender.
Mrs. Debrah-Grieves' who appeared on behalf of the beleaguered company, did not explicitly say her client was in dire financial straits, but her body language certainly did.
"My Lord, we have decided to withdraw the motion for a stay of execution, and rather negotiate an amicable settlement," she pleaded.
"You have been saved by the bell", the Justices of the Appeal Court intoned.
Tomorrow morning in the same court, Construction Pioneers (CP), the most favoured and well-endowed foreign construction company doing business in Ghana today, will be saving themselves the embarrassment of being declared insolvent owing to a huge 18 billion cedis debt staring them in the face since March 1997.
It is not too clear how CP which enjoyed the juiciest contracts in Ghana came to owe TotalFinalElf, a prominent oil company in Ghana the staggering sum of ¢18 billion. It is also not clear how that huge debt kept piling without any let or hindrance over that same time, as the oil company chased lawyers of CP for their moneys without any fruitful results.
Indications however are that under the current atmosphere CP, reeling from the punches of due process, is compelled to withdraw a contentious stay of execution application it filed on the eve of the last recess by the law courts, after taking advantage of a caveat in an unstamped document to bide for time. CP was running, but it evidently could not hide.
It has since March, 1997, paid only ¢500 million out of the huge pile of debt arising from the purchase on credit terms of petroleum products and bitumen for its constructional projects. On June 27, 2002, both parties appeared in the High Court of Justice to seal a deed of settlement earlier made between the plaintiff, Totalfinalelf and CP, the defaulting party and defendant.
Under the arrangement, CP agreed to pay ¢1 billion monthly in or before August 2002, until the judgement debt was fully liquidated.
Alternatively, CP had the option to pay ¢9 billion on or before June 30,2002.
CP failed to honour its word in terms of making good its indebtedness, only for its lawyers to take advantage of the last recess of the courts to slip in a motion of stay of execution at the Appeals Court.
Unfortunately, the recess was not to last a million years, and there was no politician to intervene and indefinitely postpone the company's plight.
The Appeals Court judges, in giving their ruling yesterday, requested CP to withdraw their application for stay of execution first before the court considers CP's request for a negotiated settlement that would involve a settlement of their indebtedness by reasonable installments.
On July 2002, His Lordship Justice J. K. Abiasah struck out a motion on a stay of execution filed by CP at the High Court after concluding that CP had been in breach of the terms of payment agreed upon by both parties.
Accordingly, leave was granted by the court for a levying of execution against the defendant and debtor, Construction Pioneers.