M&C represents a leading construction company in five significant disputes concerning performance guarantees, advance payment guarantees and contractual rights arising from major infrastructure projects.
The High Court Division has granted stay orders in five separate proceedings arising from contractual disputes relating to major infrastructure projects at Chandpur, Narayanganj, Gazipur and Pangaon-Ashuganj. The disputes involve, among other issues, threatened encashment of bank and performance guarantees, contractual termination, and payment disputes arising from execution of the respective projects.The five proceedings concern substantial infrastructure works undertaken for public authorities, with the disputed guarantees collectively valued at several crores of Taka. The dispute resolution mechanism in multiple agreements provides for arbitration before the International Chamber of Commerce.
In each matter, the Contractor first sought interim relief before the Commercial Court, invoking Section 7Ka of the Arbitration Act, 2001, to restrain the authorities from encashing the guarantees and giving effect to contract terminations pending arbitration. The Commercial Court issued only a show cause notice without granting the ad-interim injunction sought, and the Contractor moved before the High Court Division, challenging the order and seeking interim protection.
Having heard the matters, the High Court Division granted an order of stay, providing the Contractor with interim protection pending adjudication of the disputes through the agreed arbitration mechanism.
Saqeb Mahbub, Partner and Sajid Hassan, Associate, represented the client before the High Court Division and Sohrawardy Arafat Khan, Associate, represented the client before the Commercial Court on behalf of Mahbub & Company.
