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Rwanda Commercial

Supreme Court

SORAS v. WHITEFIELD

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Professional case brief

Research organized from the available case record

Source document

01

Holding and result

SORAS AG Ltd was not denied the opportunity to present its case before the arbitral tribunal. The insurance contract did not distinguish between water damage and flood damage, thus coverage extended to the damages claimed. There was no procedural irregularity justifying setting aside the arbitral award under Article 47 of Law nº 005/2008. The appeal lacked merit and was dismissed.

Court disposition

appeal dismissed

Orders

  • The Supreme Court affirms the decision of the High Commercial Court in RCOMA 0540/14/HCC of 28/11/2014.
  • SORAS AG Ltd is ordered to pay WHITEFIELD ENTERPRISES Ltd 800,000 Frw for legal fees and costs.
  • Court costs to be borne as incurred.

02

Material facts

Parties

SORAS AG Ltd

Appellant Counsel: Me MUKANZIGIYE Donatille

WHITEFIELD ENTERPRISES Ltd

Respondent Counsel: Me BUTARE Emmanuel

Amounts and remedies

  • Total Arbitral Award (principal and Costs): Frw 51,574,157
  • Legal Fees and Costs Awarded by Supreme Court: Frw 800,000
  • Legal Fees Awarded by High Commercial Court: Frw 300,000
  • Damages for Loss of Business (claimed, Not Awarded): Frw 10,000,000
  • USD Awarded for Legal Letter Preparation: USD 200

03

Procedural history

  1. Posture

    Commercial Arbitration Appeal / Supreme Court Final Judgment

04

Questions and positions

Legal issues

Party arguments

Applicant
SORAS AG Ltd argued it was not given a proper opportunity to explain the distinction between 'dégâts des eaux' (water damage) and 'inondation' (flood), claiming the insurance contract did not cover flood damage and that the arbitral process was procedurally deficient.
Respondent
WHITEFIELD ENTERPRISES Ltd argued SORAS had no right to appeal the arbitral award, that the arbitral process was fair, and that the insurance contract covered all water-related damages, including those from flooding. They also claimed entitlement to damages and legal costs.

05

Court’s reasoning

  1. 01

    Article 47, Law nº 005/2008 of 14/02/2008 on Arbitration and Conciliation in Commercial Matters

    An arbitral award may only be set aside if the applicant proves they were not properly notified of the appointment of the arbitrator, the arbitral procedure, or were unable to present their case for a valid reason.

  2. 02

    Arbitral award and Supreme Court analysis

    Interpretation of insurance contracts should be based on the actual terms agreed by the parties, and coverage extends to all water-related damages if not specifically excluded.

06

Ratio, limits and disposition

Ratio decidendi

SORAS AG Ltd was not denied the opportunity to present its case before the arbitral tribunal. The insurance contract did not distinguish between water damage and flood damage, thus coverage extended to the damages claimed. There was no procedural irregularity justifying setting aside the arbitral award under Article 47 of Law nº 005/2008. The appeal lacked merit and was dismissed.

Obiter and limits

  • Damages for loss of business due to litigation (10,000,000 Frw) were not considered as the issue was not raised in the lower court and thus could not be introduced on appeal.

Court disposition

appeal dismissed

  • The Supreme Court affirms the decision of the High Commercial Court in RCOMA 0540/14/HCC of 28/11/2014.
  • SORAS AG Ltd is ordered to pay WHITEFIELD ENTERPRISES Ltd 800,000 Frw for legal fees and costs.
  • Court costs to be borne as incurred.

Source and reliance status

Supreme Court · 24 June 2016

This page organises the available record for research. Confirm quotations, current status, and subsequent treatment against the official source before relying on the case.

Judgment reading view

Judgment text

The complete available source text.

Source document

Supreme Court

Commercial· 24 June 2016

RCOMA 0012/15/CS

SORAS v. WHITEFIELD

- Source: Amategeko - Section: Decisions (Judgements) - Date: 2016-06-24 - Case/document no.: RCOMA 0012/15/CS - Collection: Supreme Court

Text

Page 1

SORAS v. WHITEFIELD [Rwanda URUKIKO RW’IKIRENGA – RCOMA 0012/15/CS (Mutashya, P.J., Munyangeri na Muyoboke, J.) 24/06/2016] Amategeko agenga ubukemurampaka – Gukuraho icyemezo cy’ubukemurampaka – Imyanzuro yafashwe hakoreshejwe ubukemurampaka ishobora kuvanwaho n’Urukiko igihe gusa uwiyambaje ubukemurampaka usaba iryo vanwaho atanze ibimenyetso ko atamenyeshejwe uko bikwiye ishyirwaho ry’umukemurampaka cyangwa imigendekere y’ubukemurampaka cyangwa ko atashoboye kubona uburyo bwo kwiregura kubera impamvu runaka. Itegeko nº 005/2008 ryo kuwa 14/02/2008 ryerekeye ubukemurampaka n’ubwunzi mu bibazo by’ubucuruzi, ingingo ya 47. Incamake y’ikibazo: WHITEFIEL Ese Ltd ivuga ko umwuzure watewe n’imvura idasanzwe yangije ibicuruzwa byayo, ariko kuko yakoranye na SORAS amasezerano y’ubwishingizi bw’inkonji y’umuriro (assurance incendie) hamwe n’ubwishingizi burebana n’impanuka zitewe n’amazi (degat des eaux), iyisaba kwishyura ibyangiritse, SORAS iyisubiza ivuga ko mu byo yishingiye hatarimo ibizangizwa n’umwuzure. Bitewe nuko ubukemurampaka bwari bwateganyijwe mu masezerano y’ubwishingizi,WHITEFIELD irabwiyambaza isaba kwishyurwa ibyangiritse byayo byose, inyungu yavukijwe, indishyi z’akababaro hamwe n’ay’ikurikiranarubanza. Ubukemurampaka nabwo butegeka SORAS kuyishyura amafaranga angana na 51.574.157 Frws akubiyemo ibyo yangijwe byose hamwe nibyo yatakaje mu gukurikirana

urubanza. SORAS ntiyabyishimiye maze ijurira icyo cyemezo cy’abakemurampaka mu Rukiko Rukuru rw’Ubucuruzi, rwemeza ko umwanzuro w’abakemurampaka ugumaho. SORAS yongera ijurira mu Rukiko rw’Ikirenga isaba gukuraho icyemezo cyafashwe. Uhagarariye SORAS avuga ko mu miburanishirize umucamanza yagaragaje gusa ko impanuka yabaye yari yishingiwe ku buryo SORAS yagombaga kubiryozwa, avuga ko ibi kandi bigaragazwa n’ibisobanuro yatangaga kw’ itandukaniro riri hagati ya innondation na degats des eaux. SORAS ivuga kandi ko ibyabaye ku bicuruzwa byangiritse ari innondation mu gihe amasezerano y’ubwishingizi bakoranye na WHITEFIELD arebana na dégâts des eaux. Uhagarariye WHITEFIELD we akavuga ko SORAS idafite uburenganzira bwo kujurira icyemezo cyafashwe n’ubukemurampaka kandi ko hashingiwe ku ngingo ya 47 y’ubukemurampaka, urukiko rutategeka ubukempurampaka gusubira ku cyemezo cyabo. Ku bwizi mpamvu WHITEFIELD ivuga ko ari umushoramari kandi amafaranga yagombaga gucuruza akaba yarabuza imirimo ye ikaba igenda nabi, bigatuma ibisabira indishyi, hamwe n’amafaranga y’ikurikiranarubanza n’igihembo cy’Avoka. SORAS iyisubiza ivuga ko ariyo ahubwo igomba guhabwa indishyi zo gushorwa mu manza kuko izo WHITEFIELD isaba zo nta shingiro zifite. Incamake y’icyemezo: 1. Imyanzuro yafashwe hakoreshejwe ubukemurampaka ishobora kuvanwaho n’Urukiko ruvugwa igihe gusa uwiyambaje ubukemurampaka usaba iryo vanwaho

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atanze ibimenyetso ko atamenyeshejwe uko bikwiye ishyirwaho ry’umukemurampaka cyangwa imigendekere y’ubukemurampaka cyangwa ko atashoboye kubona uburyo bwo kwiregura kubera impamvu runaka.

2. Urukiko rrwasanze amafaranga y’indishyi angana na 10.000.000 Frw WHITEFIELD ENTREPRISES Ltd isaba ivuga ko yahombeye mu gushorwa mu manza na SORAS bitasuzumwa muri uru rubanza kuko ikiburanwa muri uru rubanza ni ugusuzuma niba imihango y’ubukemurampaka yarubahirijwe ari nacyo cyari cyararegewe mu Rukiko Rukuru rw’Ubucuruzi, bityo ingingo itasuzumwe n’Urukiko rubanza ikaba itasuzumwa bwa mbere mu bujurire. Ubujurire bwa SORAS AG Ltd nta shingiro bufite. Amagarama yatanzwe ahwanye n’ibyakozwe mu rubanza. Amategeko yashingiweho: Itegeko nº 005/2008 ryo kuwa 14/02/2008 ryerekeye ubukemurampaka n’ubwunzi mu bibazo by’ubucuruzi, ingingo ya 47. Nta manza zifashishijwe. Urubanza I. IMITERERE Y’URUBANZA. [1] Ku itariki ya 04/01/2013, WHITEFIELD ENTREPRISES Ltd, yagiranye na SORAS AG Ltd amasezerano y’ubwishingizi bw’inkongi y’umuriro (assurance incendie) hamwe n’ubundi bwishingizi bw’inyongera burebana n’impanuka zitewe n’amazi ″dégâts des eaux″. Ku itariki ya 17/12/2013 haguye imvura idasanzwe itera umwuzure “muri park industriel” aho WHITEFIELD ikorera, uwo mwuzure wangiza ibicuruzwa byayo, maze ishingiye ku masezerano y’ubwishingizi yagiranye na SORAS AG Ltd iyisaba ko yakwishyura ibyangiritse ariko SORAS AG Ltd isubiza ko itabyishyura kubera ko mu byo yishingiye hatarimo ibizangizwa n’umwuzure. [2] Kuwa 05/05/2014, WHITEFIELD ENTREPRISES Ltd yiyambaje ubukemurampaka kuko bwari

buteganyijwe mu masezerano y’ubwishingizi bagiranye, asaba kwishyurwa ibyangiritse bingana na 40.237.558 Frw, inyungu yavukijwe zingana na 28.960.846 Frw ndetse asaba 3.700.000 Frw y’ikurikiranarubanza n’igihembo cy’avoka, 200 USD yahawe avoka wateguye ibaruwa yandikiwe uregwa, 5.000.000 Frw y’indishyi z’akababaro, 500.000frw y’umuhesha w’inkiko n’amafaranga y’ubukode no kuzishyura amafaranga yose azagenda k’ubukemurampaka. [3] Kuwa 30/09/2014, Inteko Nkemurampaka yemeje ko ikirego yashyikirijwe na WHITEFIELD ENTREPRISES Ltd gifite ishingiro kuri bimwe, itegeka SORAS AG Ltd kuyishyura 40.237.558 Frw y’agaciro k’ibicuruzwa byayo byangijwe n’amazi kandi byari bifite ubwishingizi, 2.494.729frw y’inyungu bwite, igihembo cy’avoka kingana na 3.700.000 Frw, 200 USD yishyuwe uwayiteguriye ibaruwa yandikiwe SORAS AG Ltd, 500.000 Frw yishyuwe umuhesha w’inkiko w’umwuga, 3.741.870 Frw yishyuwe Inteko y’Abakemurampaka, 400.000

Page 3

Frw yishyuwe imirimo y’ubukemurampaka na 500.000 Frw yishyuwe umuhanga mu ibaruramari, yose akaba 51.574.157 Frw na 200 USD. [4] SORAS AG Ltd yajuririye icyo cyemezo cy’abakemurampaka mu Rukiko Rukuru rw’Ubucuruzi, urwo rukiko ruca urubanza kuwa 28/11/2014 rwemeza ko umwanzuro w’abakemurampaka wasabirwaga gukurwaho ugumaho, SORAS ikishyura WHITEFIELD Entreprises Ltd igihembo cy’avocat kingana 300.000 Frw. [5] SORAS AG Ltd yajuririye Urukiko rw’Ikirenga isaba gukuraho icyemezo cy’abakemurampaka kuko itahawe uburyo bwo kwisobanura ngo igaragaze ko ″dégâts des eaux″ itandukanye na ″inondation″. [6] Urubanza rwaburanishijwe mu ruhame kuwa 24/05/2016, SORAS AG Ltd ihagarariwe na Me MUKANZIGIYE Donatille, WHITEFIELD ENTREPRISES Ltd ihagarariwe na Me BUTARE Emmanuel. II. ISESENGURA RY’IBIBAZO BIGIZE URU RUBANZA A. Kumenya niba SORAS AG Ltd itarahawe uburyo bwo kwisobanura n’ingaruka byatera ku cyemezo cyafashwe n’ubukemurampaka. [7] Me MUKANZIGIYE Donatille uhagarariye SORAS AG Ltd avuga ko umucamanza yirengagije imyiregurire batanze aho yagaragazaga ko icyaburanwaga cy’ibanze cyari ukugaragaza niba impanuka yabaye yari yishingiwe (responsabilité), ku buryo SORAS yagombaga kubiryozwa, ibyo bikaba byaragaragazwaga n’ibisobanuro ku itandukaniro ry’ubwishingizi « dégâts des eaux» na «inondation» SORAS AG Ltd yatangaga mu iburanisha kandi bikaba byari bikubiye no mu mwanzuro batanze,

yiyemerera ko nabo ubwabo nta définition bahaye dégâts des eaux. [8] Avuga ko ibyo SORAS yishingiye ari ubwishingizi « dégâts des eaux» naho ibyabaye ku bicuruzwa bya WHITEFIELD ENTREPRISES Ltd bikaba ari «inondation» kandi SORAS itarabyishingiye. [9] Me BUTARE Emmanuel uhagarariye WHITEFIELD ENTREPRISES Ltd avuga ko ashingiye ku byo SORAS ishingiraho ijurira, nta burenganzira yabona bwo kujuririra icyemezo cyafashwe n’abakemurampaka kandi nta n’aho Urukiko rwahera rutegeka ubukemurampaka gusubira ku cyemezo cyabwo hashingiwe ku ngingo ya 47 y’Itegeko rigenga ubukemurampaka. [10] Akomeza avuga ko ibyo SORAS ivuga ko itahawe umwanya wo gusobanura itandukaniro riri hagati ya” dégâts des eaux “ na “ inondation”, nta shingiro ryabyo kuko inteko y’Urukiko nkemurampaka yabiburanishijeho, ababuranyi babyireguraho, ibifataho umwanzuro, ko kandi amasezerano bagiranye agaragaza ko “dégâts des eaux” ari ibintu byose byangirika biturutse ku mazi.

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Uko Urukiko rubibona [11] Ingingo ya 47, 1◦, b) y’Itegeko nº 005/2008 ryo kuwa 14/02/2008 ryerekeye ubukemurampaka n’ubwunzi mu bibazo by’ubucuruzi iteganya ko ″ imyanzuro yafashwe hakoreshejwe ubukemurampaka ishobora kuvanwaho n’Urukiko ruvugwa mu ngingo ya 8 y’iri tegeko igihe gusa uwiyambaje ubukemurampaka usaba iryo vanwaho atanze ibimenyetso ko atamenyeshejwe uko bikwiye ishyirwaho ry’umukemurampaka cyangwa imigendekere y’ubukemurampaka cyangwa ko atashoboye kubona uburyo bwo kwiregura kubera impamvu runaka″. [12] Urukiko rusanga ibyo Me MUKANZIGIYE Donatille uhagarariye SORAS AG Ltd avuga ko SORAS itahawe uburyo bwo kwisobanura kugira ngo igaragaze itandukaniro riri hagati y’ubwishingizi ″dégâts des eaux″ na ″inondation″ kuko itigeze yishingira ″inondation″ mu masezerano yagiranye na WHITEFIELD ENTREPRISES Ltd nta shingiro byahabwa, kubera ko nkuko byasobanuwe mu cyemezo cyafashwe n’ubukemurampaka mu gace kacyo ka 13, mu masezerano y’ubwishingizi WHITEFIELD ENTREPRISES Ltd yagiranye na SORAS AG Ltd, batatandukanyije ibyangijwe n’amazi aturuka ku nzu, n’ibyangijwe n’amazi y’ibiza ″inondation ″, icyishingiwe kikaba ari icyakwangizwa biturutse ku mazi, bivuze ko aho yaba aturutse hose akagira ibyo yangiza, ubwishingizi bwabyishyura. [13] Urukiko rw’Ikirenga rusanga kandi no mu rubanza rujuririrwa ku rupapuro rwa 2, agace ka 5, byarasobanuwe, kuba Me MUKANZIGIYE Donatille

uhagarariye SORAS avuga ko mu iburanisha batahawe umwanya n’uburyo bwo kwisobanura nta shingiro byahabwa, kubera ko kuba ibyo SORAS AG Ltd yasobanuye bitarashingiweho itabyita kubuzwa uburyo bwo kwisobanura, bityo hashingiwe ku ngingo ya 47 y’itegeko ryavuzwe haruguru, ibyo SORAS ivuga bikaba nta shingiro bifite. B. Kubyerekeye indishyi zisabwa muri uru rubanza. [14] Me BUTARE Emmanuel uhagarariye WHITEFIELD ENTREPRISES Ltd avuga ko WHITEFIELD ENTREPRISES Ltd ari umushoramari, amafaranga yagombaga gucuruza akaba yarabuze bituma imirimo yayo igenda nabi, ikaba ibisabira indishyi zingana na 10.000.000 Frw, igahabwa 1.000.000 Frw y’igihembo cy’avoka n’ikurikiranarubanza. [15] Me MUKANZIGIYE Donatille uhagarariye SORAS AG Ltd avuga ko SORAS yajuriye kugirango hatangwe ubutabera ku mpande zombi bityo amafaranga asabwa na WHITEFIELD ENTREPRISES Ltd akaba nta shingiro yahabwa, kubera ko ari mu manza akaba atari ayo ubucuruzi bwabo bushingiyeho kuko batazi igihe bazayabonera, akaba ari SORAS yahabwa indishyi zo gushorwa mu manza zingana 500.000 Frw, igahabwa 1.000.000 Frw y’igihembo cy’avoka n’ikurikiranarubanza. Uko Urukiko rubibona. [16] Urukiko rusanga indishyi, amafaranga y’ikurikiranarubanza n’igihembo cy’avoka bisabwa na Me MUKANZIGIYE Donatille uhagarariye SORAS AG Ltd nta shingiro ryayo, kubera ko ikirego cyayo nta shingiro gifite.

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[17] Urukiko rusanga indishyi zisabwa na Me BUTARE Emmanuel uhagarariye WHITEFIELD ENTREPRISES Ltd zifite ishingiro ku birebana n’amafaranga y’ikurikiranarubanza n’igihembo cy’Avoka yasabye, ariko ikaba igomba kuyahabwa mu bushishozi bw’Urukiko kuko ayo yasabye ari ikirenga , ikaba igomba guhabwa 500.000 Frw y’igihembo cy’Avoka na 300.000 Frw y’ikurikiranarubanza, yose hamwe akaba 800.000 Frw. [18] Urukiko rrwasanze amafaranga y’indishyi angana na 10.000.000 Frw WHITEFIELD ENTREPRISES Ltd isaba ivuga ko yahombeye mu gushorwa mu manza na SORAS bitasuzumwa muri uru rubanza kuko ikiburanwa muri uru rubanza ni ugusuzuma niba imihango y’ubukemurampaka yarubahirijwe ari nacyo cyari cyararegewe mu Rukiko Rukuru rw’Ubucuruzi, bityo ingingo itasuzumwe n’Urukiko rubanza ikaba itasuzumwa bwa mbere mu bujurire. III. ICYEMEZO CY’URUKIKO. [19] Rwemeje ko ubujurire bwa SORAS AG Ltd nta shingiro bufite. [20] Rutegetse ko imikirize y’urubanza RCOMA 0540/14/HCC rwaciwe n’Urukiko Rukuru rw’Ubucuruzi, ku wa 28/11/2014 idahindutse. [21] Rutegetse SORAS AG Ltd guha WHITEFIELD ENTREPRISES Ltd 800.000 Frw y’igihembo cya Avoka n’ay’ikurikiranarubanza. [22] Rutegetse ko amagarama yatanzwe ahwanye n’ibyakozwe mu rubanza.

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Law nº 005/2008 of 14/02/2008 on Arbitration and Conciliation in Commercial Matters, Article 47

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