Dissolved Shell Comes Out Victories Again

An oil retail company, Shell Limited Ethiopia, was able to win the court battle

Justices of the Federal Supreme Court’s Cassation Bench rejected an appeal by Hailu G.Hiwot, a real-estate owner, who has been battling with Shell Limited Ethiopia over ownership of a gas station located in Kazanchis.

Hailu took the case to the Cassation Bench stating the lower court, the Federal Supreme Court, made 13 fundamental errors of law in ruling in favour of Shell. The Cassation Bench dismissed the case citing that there is no error of law.

The parties had been in a court battle for four years, which was won by Shell in April 2011.

The two parties got into a dispute 11 years ago when Shell, an oil retailes established during the regime of Haile Selassie, dissolved by Oil Libya in 2007. Shell, the dissolved company, filed a civil suit to the Federal High Court claiming that the 1.1 million Br worth gas station found around Tito Street belongs to it, not Hailu the owner of Coffee Plaza in Kazanchis.

Shell had a three-decade-long rental agreement with Hailu for 700 Br since 1965, who was also an agent.

The defendant stated in a preliminary objection that the plaintiff does not have the legal capacity to bring and entertain the case since it is a foreign company. Additionally, Hailu claimed the land where the gas station is found belongs to him as he has been paying tax on it after being requested to by Kirkos District Land Administration Office.

The Federal High Court ruled in favour of Shell, stating that the plot should be transferred as the rental relation ended when the Dergue nationalised the extra lands of individuals and transferred them to administration by kebeles.

Displeased with the court’s ruling, Hailu took the matter to the Supreme Court, arguing that Shell is a foreign company, and the Ethiopian Civil law does not allow non-nationals to own immovable property.

The contract had ended in 1995, and the company did not renew. Shell instead asked the Kirkos District, where the gas station is located, for a title of ownership of the land while Hailu continued to pay tax.

Justices at the Supreme Court framed the issue of who should have ownership of the land and whether the property was nationalised or not. They ordered the Government Housing Agency, the Kirkos District Land Administration Office and wereda 08 of the district to provide evidence of ownership over the land.

The authorities first provided information that shows that as far as they knew, ownership belongs to Shell. But upon a second hearing provided evidence that Hailu has indeed been paying tax for the plot of land, and as such, the property was never nationalised and belongs to him.

Despite this, the justices of the Supreme Court voted in favour of Shell asserting that just because the tax has been paid, it does not solely mean the payer automatically becomes the owner. The Court also ruled that if the land has to be transferred given that Shell is a foreign company, it will not necessarily be to Hailu.

Dissatisfied, Hailu took the case to the Cassation Bench stating the lower court made 13 fundamental errors of law such as lack of legality to open a case by either the Shell or Courts while reviewing and settling the case.

After reviewing the applicant’s claim, the Cassation Bench dismissed the case saying that there is no fundamental error of law in the lower court’s decision.

Currently, the parties are arguing over the repayment of legal cost during the trial.


Published on Apr 22,2018 [ Vol 18 ,No 939]



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