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ICC throws out Micheletti’s arbitration case against Ghana

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The International Chamber of Commerce (ICC) has dismissed an international arbitration case brought by Micheletti Company Limited against the government of Ghana in May 2023, concerning alleged damages for breach of contract related to the rehabilitation of the Accra Sports Stadium.

The ICC Tribunal, composed of President Sadaff Habib and members Shadrack Arhin and Justin Amenuvor, upheld the Attorney-General of Ghana’s contention that the arbitration proceedings were statute-barred. The Tribunal agreed that the action had been initiated beyond the time limit specified by Ghana’s Limitation Act.

Background

In April 2006, the Government of Ghana entered into an agreement with Waterville Holdings (BVI) Limited for the rehabilitation of several sports stadiums, including the Accra Sports Stadium, El-Wak Stadium in Accra, and Baba Yara Sports Stadium in Kumasi, in preparation for the 2008 African Nations Cup. Micheletti was the local sub-contractor for the Accra Sports Stadium, while Consar Limited was the sub-contractor for the Baba Yara Sports Stadium.

On August 1, 2006, the government terminated the agreement, citing the lack of Cabinet approval. Subsequently, negotiations were held with Micheletti and Consar to continue the rehabilitation work. The value of the work completed by the contractor was certified, and the government duly paid for all certified work.

The 2023 arbitration was initiated by Micheletti for claims allegedly unpaid by the government. Micheletti sought special damages amounting to $400,000, interest on this sum from February 2009 at the Bank of Ghana’s forex rate plus three percent, administrative fees, and arbitral costs.

The Office of the Attorney-General denied any liability and raised a preliminary objection based on the ICC Rules of Arbitration. Assistant State Attorney Anne-Marie Ayanru argued that Micheletti had not exhausted the dispute resolution procedures under the FIDIC General Conditions of Contract, which required initial submission to a Dispute Adjudication Board (DAB). Additionally, Ghana contended that the claim, filed more than 14 years after the cause of action arose, was statute-barred under Ghanaian law.

Operative part

The Tribunal agreed to address the preliminary objection first. It found that it had jurisdiction to hear the matter since Micheletti had notified the government of its intention to refer the dispute to a DAB, but the government ignored this notification.

However, the Tribunal concurred with the government that the action was statute-barred under Ghanaian law, having been filed beyond the six-year limit set by Ghana’s Limitation Act, 1972 – NRCD 54.

As a result, the Tribunal dismissed Micheletti’s claims entirely. The Tribunal is now considering submissions on the costs to be awarded to the government and will soon decide on the quantum of costs.

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