Continuing his testimony in the Marine Cement Share transaction case, the Group Accountant of a multinational company told the Colombo Commercial High Court on Tuesday that the Memorandum of Understanding (MoU) between businessman-politician Mohamed Maharoof and the former General Manager P. Bates of Marine Cement, Zurich, Switzerland, is legally invalid, due to Mr. Maharoof’s failure to implement certain agreements in the MoU within three to six months (of its implementation).
Group Accountant Robert Locher of Marine Cement, Zurich, Switzerland, said that several obligations under the MoU had not been fulfilled by the Plaintiff, a former Colombo District MP and a UPFA candidate at yesterday’s Colombo Municipal Council elections.
He was referring to Mr. Maharoof’s claim of a payment of US$ 4,792,500 on cement from Marine Cement in Switzerland, as dues, after striking a deal between the Sri Lanka Government and the Company, to obtain more shares in the local company, Lafarge Mahaweli Cement (Private) Ltd.
At the earlier hearing, Mr. Locher, in his evidence said, his Company had paid commissions worth hundreds of thousands of US dollars to a Swiss bank account of Mohamed Maharoof, and produced his Company's accounts which showed that commissions to Mr. Maharoof' were paid into a bank account at Credit Suisse in Zurich.
While the reason for these commissions was unclear, lawyers for the Company explained to the Sunday Times that these were for arranging the deal, while as per any further payments – as now claimed by the Plaintiff – the Company was not liable to pay as the MoU was invalid.
The case was taken up before Colombo Commercial High Court Judge Mahinda Samayawardena. Mr. Maharoof maintains that after successful negotiations conducted by him and on behalf of Marine Cement Ltd., they were able to purchase more shares in the local company. According to his plaint, Marine Cement had become the owner of approximately 85% of shares of Lafarge Mahaweli Cement Private Ltd. due to his negotiations. Mr. Maharoof claimed that, however, an agreement reached later for the payment of US$ 1.50 per metric tonne to him, on cement sold by Lafarge Mahaweli Cement Private Ltd. had been breached. He was claiming US$ 4.7 million as dues.
Attorney-at-Law Anura Meddegoda, instructed by Varners Law Associates, appeared for Marine Cement of Switzerland, while Attorney-at-Law Farman Cassim, instructed by Samararatna Associates, appeared for Mr. Maharoof. The case will be taken up for hearing again on February 9.