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Saturday, July 20, 2024

Court orders MA Kharafi to pay over D80M to Meeting Point Hotel

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By Bruce Asemota

Justice AT Osei of the Kanifing High Court has ordered MA Kharafi and Sons Company (Gambia) Ltd to refund Meeting Point Hotel Management Gambia Ltd the sum of $1, 401,400.00.
The court also declared that the termination of the Hotel Lease Agreement between the parties by the defendant (Meeting Point Hotel Management Gambia Ltd) was unlawful.
Justice Osei adduced that MA Kharafi had sued Meeting Point Hotel claiming that it entered into a hotel lease management agreement with the hotel on the 1 November 2017. He said the Kairaba Beach Hotel, Coral Hotel and Spa were leased to the defendant for a period of three years effective November 2017 to 31 October 2020.
The trial judge further pointed out that under the agreed terms, the sum of $2, 802.800.00 was payable in two instalments but the defendant paid a deposit of $1,401,400.00 to the plaintiff as security which was to be refunded to the defendant upon the termination of the lease.
He revealed that MA Kharafi claimed that during the course of the Covid-19 outbreak in The Gambia, they received a letter from the defendant purporting to invoke the clause on force majeure in their agreement, terminating the agreement as a result of the Gambia government declaration of the outbreak and the closing of the air space to countries that were hardest hit by the virus.
But according to Justice Osei, MA Kharafi contended that the defendant wrongfully terminated the contract and that caused it to suffer losses and damages.
He added that the defendant averred that the plaintiff had been in continuous breach of the lease agreement and had refused to return the deposit of rent it (defendant) paid despite taking over the hotels since July, 2020, contrary to the provisions in the agreement.
Justice Osei further disclosed that the court is guided by the signed lease agreement of the parties in determining this case.
The trial judge revealed that the parties tendered in evidence the lease agreement as exhibits and it is imperative that the meaning of force majeure is expounded in determining whether the termination of the lease was lawful on the grounds of force majeure.
He stated that the court found that the declaration made by the World Health Organisation that Covid-19 is a pandemic coupled with the Gambia ministry of health official announcement of registered Covid-19 cases at the time are enough basis to conclude that The Gambia was affected by a force majeure.
He further stated that the defendant exhibited documents to give reasons for invoking the force majeure clause based on the Covid-19 pandemic at the time.
Justice Osei declared that The Gambia was directly affected by the Covid-19 pandemic. He therefore declared that the termination of the hotel lease agreement between the parties by the defendant was lawful.
Justice Osei further declared that based on the termination of the lease agreement and article 16 of the lease agreement clause, the defendant is entitled to a refund of the security deposit which it paid to the plaintiff.

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