Pakistan loses appeal against Broadsheet, to pay Rs5.21 bn penalty

Pakistan loses appeal against Broadsheet, to pay Rs5.21 bn penalty

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WASHINGTON: Pakistan lost yet another case against Broadsheet LLC, as its plea has been dismissed by the London High Court, setting the total payable amount at more than 33 million dollars (Rs5.21 billion).

The London Court of International Arbitration (LCIA) had awarded Islamabad a penalty of some 22 million dollars in the Broadsheet LLC case late last year. Dissatisfied, the state of Pakistan and the National Accountability Bureau (NAB) then filed an appeal in London High Court under the UK Arbitration Act in early March this year. In the application, Pakistan maintained that the tribunal had failed to conduct the proceedings in accordance with the procedures agreed by the parties and the LCIA did not comply with the requirements of the award.

As claimants, the NAB and the state, had appealed to review the award decision. Broadsheet, a company incorporated in the Isle of Man, was hired by the NAB during former President Pervez Musharraf’s regime to investigate hidden assets of over 150 Pakistanis abroad including the Sharif family. The agreement, however, was terminated by the NAB in 2003.

After that the company filed a claim against Pakistan worth millions of dollars in damages. Former English Court of Appeal judge Sir Anthony Evans QC heard the case at the London Court of International Arbitration as sole arbitrator under the rules of the Chartered Institute of Arbitrators.

The arbitration body heard the claim by Broadsheet and held that Pakistan was liable to pay damages as NAB wrongfully repudiated an asset recovery agreement with Broadsheet. The tribunal had ruled that Broadsheet LLC was entitled to damages and after the quantum stage, asked Pakistan to pay up the amount of almost 22 million dollars, as well as cost of the case to the plaintiff amounting to some 11 million dollars.

Pakistan decided to appeal the decision and approached the London High Court. According to Washington based law firm, Crowell & Moring, hired by Broadsheet LLC; the London High Court dismissed Pakistan’s application on Friday and ruled that the reasoning of the tribunal and the claimants (the state of Pakistan and the NAB) are not entitled to seek (and accordingly it is not appropriate for the court to require), any further explanation as to how the conclusions were arrived at.

The judgment cited various other instances and stated that there was no basis in the case to conclude that the tribunal might well have reached a different view. “The complaint in this case is that the decision called for a further explanation as to how it was arrived at on the evidence. In my view even if that were a ‘serious irregularity’ there is no substantial injustice in the light of the clear statement in the section 57 ruling, in my view there is no possibility that the tribunal might well have reached a different view and produced a significantly different outcome,” the London High Court decision said.

Pakistan now has to not only pay the initial award amounting to 22 million dollars, but also 11 million dollars in costs and damages to the company within next thirty days; as well as more than 87 thousand pounds in costs within next fifteen days.

The latter amount relates to the appeal in the London High Court for which the Pakistan government and NAB have incurred a cost of over 192,000 pounds. Non-payment of the award and cost could result in enforcement actions likely to include seizure of Pakistan’s state assets abroad.__The

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