With five charges already bearing down on it, Access Real Estate SC, is facing three additional suits, claiming a total of 4.3 million Br.
The company, whose president, Ermias Amelga, moved to the United States a few weeks ago, had collected money promising to deliver houses on 19 different sites in Addis Abeba. After the failure to deliver any homes on schedule, these sites have all now set up subcommittees, which in turn created a parent committee to manage their dealings with the company and the courts.
Access could potentially face a class action law suit from one of these committees over the coming weeks. So far, the charges have come on an individual basis, with the first five homeowners claiming 6.5 million Br in charges filed two weeks ago.
The biggest claim in the new charges has come from Dereje Mekonnen, who says that he had made the full payment of 1.575 million Br on January 4, 2010. Upon payment, the company had promised to deliver the house in 18 months. In case of late delivery, Access had agreed to pay 5,000 Br in monthly house rent to the affected party, or to return the money with 15pc interest.
Dereje filed the suit following a notice he gave to the company on February 12, 2013, for the termination of the contract he had with them. He had asked the company for a refund of the 15pc VAT it had paid, but was able to get only 30,000 Br, according to the charges filed.
Dereje is claiming a total of 2.076 million Br from Access, including 531, 562 Br for the 15 pc penalty, up until the date he took the case to court. Dereje claims that he is in talks with Habesha Real Estate Company to buy the same three bedroom house for 2.375 million Br, and asked the court for the right to sue Access at a future date for the 298,437 Br difference.
The Sixth Bench of the Federal High Court has ordered Access to respond within 10 days of the charge, or the case will be heard in absentia.
The two other new plaintiffs, Asegedech Bahiru and Tsehay Tewelde, have claimed 1.o4 million Br and 1.2 million Br, respectively. Their cases are yet to be assigned to a bench.
Access was established in 2008 with a capital of 35 million Br and 652 shareholders. It received partial and full payments from 2,000 clients for houses, which the company said it would build at 19 sites, including; CMC, Ayat, Lafto Gerji, Bole, Lebu, Alem Bank and Betel.
Buyers from all of these sites gathered two weeks ago and elected committees to deal with Access and the courts on their behalf. Although buyers at the Meri Site had met with Ermias Amelga in November to discuss the failures of the company, the meeting was not able to come to any positive outcome. The homebuyers present at the meeting had interrupted Ermias repeatedly, claiming dissatisfaction with not only the work he was doing, but also with the answers he was giving to them at the time. Members of the Meri site took the opportunity to set up a committee back then. Two weeks ago they re-established their committee once more.
The Meri committee requested for its members to give it an official endorsement from the Documents Authentication & Registration Office (DARO). As of last Monday, 115 of the 296 homebuyers at the Meri site have gone to the DARO to endorse the committee as their legal representative. The committee expects a total of at least 200 to do so eventually.
The 19 site-based committees have also set up a larger parent committee to jointly seek information from Access and to follow up with the courts.
The Meri Committee is now negotiating with a team of three lawyers, one of whom is also a member of the parent committee, Abdurahman Mohammed, to start a class action.
The new committee, which includes some of the members from the old committee, has not yet compiled information on the claims of its members.
The committee is scheduled to meet today to discuss their course of action.
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