Orano Mining SAS v United VAT Consultants (Pty) Ltd (HC-MD-CIV-MOT-GEN-2023/00586) [2025] NAHCMD 83 (7 March 2025)

REPUBLIC OF NAMIBIA

HIGH COURT OF NAMIBIA MAIN DIVISION, WINDHOEK

JUDGMENT

Case no: HC-MD-CIV-MOT-GEN-2023/00586

In the matter between:

ORANO MINING SAS APPLICANT

and

UNITED VAT CONSULTANTS (PTY) LTD RESPONDANT

Neutral citation: Orano Mining SAS v United VAT Consultants (Pty) Ltd (HC-MD-CIV-MOT-GEN-2023/00586) [2025] NAHCMD 83 (7 March 2025)

Coram: USIKU J

Heard: 5 September 2024

Delivered: 7 March 2025

Flynote: Arbitration – Recognition and enforcement of a foreign arbitral award – Recognition and Enforcement of Foreign Arbitral Awards Act 40 of 1977.

Company – Winding up – Companies Act 28 of 2004 – Section 350 – Where an arbitral award has not yet been recognised and enforced in terms of applicable legislation, s 350 has no application.

Summary: The applicant applied for the recognition and enforcement of a foreign arbitral award made by the International Court of Arbitration (‘ICC’), as well as an order for the provisional liquidation of the respondent in terms of s 350 of the Companies Act. The arbitral award was made on 21 December 2020. In terms of the award, the respondent was ordered to pay a certain amount of money plus costs. Subsequent to that, the applicant served a notice of demand on the respondent in terms of s 350(1)(a)(i) of the Companies Act for payment of the amount awarded. The respondent refused or failed to pay the amount demanded. Thereafter, the applicant launched the present application. The respondent apposed the application on various grounds. The respondent argued, among other things, that the arbitral award was erroneous and should not be recognised on public policy grounds. The respondent also contended that the arbitration had commenced on the date on which the request for arbitration was issued.

Held that, the respondent was afforded sufficient opportunity to present its case and participate in the arbitration proceedings, but failed to do so.

Held further that, the respondent cannot validly attack the merits of the applicant’s claim, as such merits were dealt with and finally determined at arbitration.

Held further that, the applicant has met all the requirements of the Recognition Act and is entitled to a recognition and enforcement order.

Held further that, in the present circumstances, before a provisional liquidation order is granted, the foreign arbitral award must first be recognised and enforced, in terms of the provisions of the Recognition Act. Where an arbitral award has not yet been recognised and enforced, s 350 of the Companies Act is not applicable. Therefore, the application for the provisional liquidation of the respondent is dismissed.

ORDER

1. The final arbitral award awarded by the International Court of Arbitration, Paris, France, dated 21 December 2020 in case number 24588/GR in the matter between Orano Mining SA and Orano Cycle SA // United VAT Consultant (Pty) Ltd and United Group (Pty) Ltd is recognised and enforced by this Court and is made an order of court in terms of section 2(1) of the Recognition and Enforcement of Foreign Arbitral Awards Act 40 of 1977.

2. The respondent is ordered to pay the costs of the applicant occasioned by the application for recognition and enforcement of the abovementioned arbitral award, such costs to include costs of one instructing and two instructed legal practitioners.

3. The applicant’s application for an order placing the respondent under provisional liquidation in the hands of the Master of the High Court of Namibia, is dismissed.

4. The applicant is ordered to pay the costs of the respondent occasioned by the application for provisional liquidation, such costs to include costs of one instructing and one instructed counsel.

5. The matter is removed from the roll and is regarded finalised.

JUDGMENT

USIKU J:

Introduction

[1] This is an application for recognition and enforcement of a foreign arbitration award. At the same time, the applicant also seeks an order for the provisional liquidation of the respondent on the basis that the respondent is allegedly deemed to be unable to pay its debts in terms of the provisions of s 350 of the Companies Act 28 of 2004 (‘the Companies Act’).

[2] The application arises out of an award made on 21 December 2020 by the International Court of Arbitration, Paris, France (‘ICC’) in case number 24588/GR.

[3] In terms of the award, the respondent was ordered to pay the respondent:

(a) USD 3 400 000 together with interest at the rate of 5% per annum calculated from 31 January 2019 until the date of the award;

(b) EUR 105 446.33 for attorney fees and expenses, as well as;

(c) USD 108 000 for the costs of the arbitration.

[4] The applicant now seeks, among other things, an order recognising and enforcing the aforegoing arbitration award, in terms of s 2(1) of the Recognition and Enforcement of Foreign Arbitral Awards Act 40 of 1977 (‘the Recognition Act’).

[5] The respondent resists the application.

Background

[6] On 29 December 2009, Areva NC and the respondent concluded a written Service Agreement (‘the agreement’) in terms of which the respondent undertook to perform certain services in return for a consideration in the amount of USD 3 400 000. The agreement was to remain in full force and effect for a period of five years.

[7] The consideration amount, referred to above, was paid to the respondent on 18 January 2010.

[8] In July 2011, the applicant took over all of Areva NC’s mining activities, leading to a universal succession of assets and liabilities. Consequently, the applicant took over the agreement.¹

[9] On 29 December 2014, the five year agreement entered into between the parties came to an end.

[10] The applicant alleged that the respondent had not provided any of the agreed -upon services, and on 28 January 2019, the applicant made a request for a full refund.² The respondent either refused or failed to make the requested refund.

[11] In terms of the agreement, any controversy or claim arising out of or relating to the agreement, shall be finally resolved pursuant to the Rules of the Conciliation and Arbitration of the ICC. The agreement further provides that, its provisions shall be construed in accordance with the laws of Switzerland.

[12] On 3 July 2019, the applicant referred the dispute to arbitration. The arbitration tribunal was constituted in accordance with the agreement and the ICC rules.

[13] The arbitrator sent all communications pertaining to arbitration, to the respondent. The respondent received and accepted delivery of all documents sent by courier services. The respondent, however, did not participate in the arbitration proceedings. The arbitration was, therefore, heard on the basis of the documents submitted by the applicant.

[14] On 21 December 2020, the ICC handed down the award in favour of the applicant as more fully set out in para 3 thereof.

[15] On 16 August 2023, the applicant demanded from the respondent, in terms of s 350(1)(a)(i) of the Companies Act, payment due to it, arising from the arbitral award. A period of 15 days passed, without the respondent having paid the demanded payment. The applicant, therefore, submits that it is entitled to an order for the provisional liquidation of the respondent.

[16] On 14 December 2023, the applicant brought the present application, seeking an order for the recognition and enforcement of the foreign arbitration award and for the provisional liquidation of the respondent.

The application

[17] In its application, the applicant submits that the parties have chosen arbitration as the means to resolve the disputes between them. The respondent had opted not to participate in the arbitration proceedings, despite due notice having been given to it. The applicant further submits that the respondent did not challenge the award and that, in the premises, the debts are not disputed by the respondent on any bona fide reasonable ground.

[18] Insofar as the prayer for provisional liquidation is concerned, the applicant submits that it has served this application on the Master of the High Court, that due security was lodged with the Master and that the Master’s certificate is duly filed at this court.

Opposition

[19] In opposing the application, the respondent asserts that the agreement in question was not entered into between the applicant and itself, but was entered between Areva NC and itself. The respondent submits that such agreement was never ceded, assigned or transferred to the applicant. The respondent contends that the alleged ‘take over’ of the mining activities by the applicant has no relevance.

[20] The respondent further contends that the arbitral award is erroneous and this court should refuse to endorse it on public policy grounds. The respondent submits that the arbitrator misread the scope of the services annexed to the agreement and misinterpreted the provisions of clause 4 of the agreement.

[21] Furthermore, the respondent denies that any payment was made by Areva to it and alleges that the consideration amount in question was paid by Orano Demantelement SA to United Africa Group, pursuant to an invoice rendered by the latter.

[22] The respondent also denies that it failed to render any services agreed upon and further denies that the entire consideration amount had to be reimbursed.

[23] In general, the respondent contends that the arbitration award was wrong and asks the court not to recognise or enforce it.

[24] In response to the contentions put forth by the respondent, the applicant submits that the respondent has not proffered any positive facts that the agreement was not taken over by the applicant. The applicant submits that the respondent has not challenged the award and cannot seek to re-argue the arbitration in these proceedings.

[25] On the issue of public policy, the applicant contends that the onus is on the respondent to prove that the recognition of the award would be against public policy. The applicant submits that the respondent has failed to discharge that onus.

Analysis

[26] It is trite that an arbitration agreement is a contract between the parties who agree that, should there be a dispute between them arising from the agreement, it shall be referred for determination by arbitration. Once the agreement is concluded between the parties, it is binding and the contracting parties are required to honour the obligations they have undertaken.

[27] In terms of s 4(1) of the Recognition Act, recognition and enforcement of the arbitral award could be denied only in limited circumstances, such as when:

‘(a) the court finds that –

(i) a reference to arbitration is not permissible in the Republic in respect of the subject-matter of the dispute concerned; or

(ii) enforcement of the award concerned would be contrary to public policy in the Republic; or

(b) the party against whom the enforcement of the award is sought, proves to the satisfaction of the court that –

(i) the parties to the arbitration agreement concerned had, under the law applicable to them, no capacity to contract, or that the said agreement is invalid under the law to which the parties have subjected it or of the country in which the award was made; or

(ii) he did not receive the required notice of the appointment of the arbitration or of the arbitration proceedings concerned or was otherwise not able to present his case; or

(iii) the award deals with a dispute not contemplated by or falling within the decisions on matters beyond the scope of the reference to arbitration: Provided that if the decisions on matters referred to arbitration can be separated from those on matters not so referred, that part of the award which contains decisions on matters referred to arbitration may be made an order of court under section 2(1); or

(iv) the constitution of the arbitration tribunal concerned was or the arbitration proceedings concerned were not in accordance with the relevant arbitration agreement or with the law of the country in which the arbitration took place; or

(v) the award has not yet become binding on the parties, or had been set aside or suspended by a competent authority of the country in which, or under the law of which, the award was made’.

[28] The onus is on the party resisting the enforcement of the award to allege and prove any of the grounds set out in s 4 of the Recognition Act.

[29] In the present matter, the respondent contends that this court should refuse to make the arbitration award an order of court, as it would be contrary to public policy and natural justice on the basis of the facts relating to absence of liability of the respondent. The respondent also contends that, the recognition of the award be refused on the basis that the arbitration commenced on the date when the request for arbitration was issued.

[30] Having read the award, it appears apparent that the respondent was afforded sufficient opportunity to present its case and participate in the arbitration proceedings, but it inexplicably failed to do so.

[31] If the arbitration had commenced on the date when the request for arbitration was issued, and the respondent was prejudiced thereby, the respondent should have brought that issue to the attention of the arbitrator. The respondent did not do so. Nor did the respondent apply for the setting aside or suspension of the award to a competent authority of the country in which or under the law of which, the award was made. The contention put forth by the respondent on this aspect has no merit and stands to be rejected.

[32] In substance, the respondent attacks the merits of the award. I am of the view that the merits of the dispute have already been ruled on by the ICC and this court is not at liberty to revisit them. The respondent’s contentions regarding the correct reading or interpretation of the provisions of the agreement, or that the applicant was not a party to the agreement, should have been raised at arbitration. The issue of the applicant not being a party to the agreement, was in any event considered and decided by the arbitrator, to the effect that, the applicant having taken over the mining activities of Areva NC, brought itself within the realm of the agreement.³

[33] In my view, the contentions made by the respondent that the recognition of the arbitral award would be against public policy have no merit for reasons stated above. I am of the view that the applicant has met all the requirements of the Recognition Act and is entitled to a recognition and enforcement order.

[34] I now turn to the applicant’s prayer for the provisional liquidation of the respondent.

[35] The applicant contends that, a foreign arbitration award is a debt for the purposes of s 350 of the Companies Act, and that if the s 350 notice is not properly answered by the local debtor then, a liquidation application can be instituted without it being a requirement that the foreign award first be made a Namibian judgment.

[36] In the matter of the Orano Demantelement SA v United Africa Group (Pty) Ltd⁴, this court rejected a similar argument, on the basis that, in circumstances where an applicant had first sought recognition and enforcement of a foreign award in terms of the Recognition Act, a s 350 demand could only be made once the award was recognised and declared enforceable. The court, therefore, found that granting a provisional liquidation order before the award is recognised and declared enforceable, would be premature.⁵

[37] I agree with the aforesaid sentiments. Before a provisional liquidation order may be granted, the foreign arbitral award must first be made an order of court. In terms of the provisions of s 4(1) of the Recognition Act, an application for the award to be made and order of court may be refused, if the conditions set out in paras (a) and (b) of that section exist. If the argument put forth by the applicant on this aspect were to be entertained, it would mean that, it is possible for a court to refuse recognition of the award, but still grant a liquidation order. In my opinion, it would not make sense for a court to order a provisional liquidation of an opposing party in arbitration against which a foreign award was issued, in the circumstances where it had refused to make the award an order of the court. I am of the view that, the award must first be recognised and the request for a liquidation based on the provisions of the Companies Act be considered thereafter.

[38] I, therefore, follow the decision made in the Orano Demantelement case, and refuse to grant the provisional liquidation relief.

[39] In conclusion, based on the reasons already stated, I am of the view that the applicant has made out a case for the recognition and enforcement of the arbitral award. The prayer for the provisional liquidation of the respondent is refused.

[40] In regard to the issue of costs, the general rule is that, a successful party is entitled to its costs. In the present matter, the applicant has only been partially successful. In the application, the applicant sought two separate and distinct kinds of relief. The first kind of relief concerns recognition and enforcement of the award. The second kind of relief concerns the liquidation of the respondent. Since the applicant was only partially successful, I am of the opinion that, in the circumstance of this case, the applicant should only be entitled to its costs insofar as its successful portion of the relief is concerned. Similarly, the defendant should be entitled to its costs to the extent that it has been successful in opposing the second kind of relief. I shall, therefore, make a costs order to the effect that, applicant is entitled to its costs occasioned by the application for the recognition and enforcement of the award and that the respondent is entitled to its costs occasioned by the application for the provisional liquidation.

[41] In the result, I make the following order:

1. The final arbitral award awarded by the International Court of Arbitration, Paris, France, dated 21 December 2020 in case number 24588/GR in the matter between Orano Mining SA and Orano Cycle SA // United VAT Consultant (Pty) Ltd and United Group (Pty) Ltd is recognised and enforced by this Court and is made an order of court in terms of section 2(1) of the Recognition and Enforcement of Foreign Arbitral Awards Act 40 of 1977.

2. The respondent is ordered to pay the costs of the applicant occasioned by the application for recognition and enforcement of the abovementioned arbitral award, such costs to include the costs of one instructing and two instructed legal practitioners.

3. The applicant’s application for an order placing the respondent under provisional liquidation in the hands of the Master of the High Court of Namibia, is dismissed.

4. The applicant is ordered to pay the costs of the respondent occasioned by the application for provisional liquidation, such costs to include costs of one instructing and one instructed counsel.

5. The matter is removed from the roll and is regarded finalised.

----------------------------------

B USIKU

Judge

APPEARANCES

Applicant: R Heathcote (with him AS Van Vuuren and F Erasmus)

Instructed by Francois Erasmus & Partners,

Windhoek

Respondent: J Diedericks (with him M Van Niekerk)

Instructed by Isaacks & Associates Inc,

Windhoek