Background
M&C represented a leading construction company in three significant disputes concerning the threatened sale, transfer, disposal or auction of project machinery, equipment and construction materials deployed at infrastructure project sites in Chandpur, Narayanganj and Pangaon-Ashuganj. The disputes arose following the termination of three separate infrastructure contracts awarded by a government-owned statutory body, involving the development and modernization of passenger terminals and the construction of cargo terminal infrastructure.
Following the termination of the respective Contracts, the government-owned institution issued memos seeking encashment of performance and advance payment guarantees, while disputes over the contractual terminations and related matters remained pending. The company challenged the legality of the relevant actions and initiated contractual dispute resolution proceedings, including arbitration before the International Chamber of Commerce (ICC), alongside proceedings before the courts of Bangladesh.
Protection of Project Machinery and Equipment
The immediate concern arose when government-owned institution attempted to auction the machinery, equipment and materials remaining at the respective project sites. Given the company’s ownership of these assets and their continued commercial importance, the proposed steps raised a serious apprehension that the machinery and materials could be sold, auctioned or otherwise disposed of in favour of third parties, notwithstanding the pending disputes and existing orders of status quo passed by the High Court Division.
M&C advised and represented the company in seeking to protect its proprietary interests and prevent any action that could prejudice the subject matter of the ongoing proceedings. The legal position centred on the company’s ownership of the machinery, equipment and materials, the absence of any contractual provision authorizing the government-owned institution to dispose of those assets, and the potential irreparable loss that would arise from their sale or auction while the underlying contractual disputes remained unresolved.
Interim Relief and Protection of Proprietary Rights
Upon consideration of the matters, the Commercial Court, Dhaka granted orders of status quo restraining the government-owned statutory body from taking further steps towards the sale, transfer, disposal or auction of the machinery situated at the respective project sites. The orders provided interim protection for the company’s assets while the underlying contractual disputes continued before the competent forums.
The matters underscore M&C’s experience in complex construction and infrastructure disputes involving public authorities, international arbitration and the protection of proprietary rights. The orders of status quo secured before the Commercial Court, Dhaka provide important interim protection for the company’s machinery and equipment against potential disposal while the underlying contractual disputes remain pending.
