BANGLADESH BANK Vs. A. LATIF & COMPANY LIMITED

JUDGEMENT

(1.) This petition for leave to appeal is directed against the judgment and order dated 03.05.2007 passed by the High Court Division in First Appeal No. 02 of 2003 and First Miscellaneous Appeal No. 01 of 2003 heard analogously dismissing both the appeals and affirming the judgment and decree dated 06.07.2002 passed by the learned Joint District Judge, 3rd Court, Dhaka in Title Suit No. 01 of 2000 making an award dated 11.11.1999 passed by the sole arbitrator-defendant-respondent No. 2 rule of the court and decreeing the suit in favour of the first party plaintiff.

(2.) The facts, in short, are that the 1st party entered into a contract with the 2nd party on 24.08.1994 and work order was followed thereafter 27.08.1994 for Construction of Bangladesh Bank, Rangpur Centre, Rangpur. According to the terms and conditions of the tender the 1st party deposited due earnest money and furnished performance bond in the form of bank guarantee. The contract contained conditions that the 1st party will execute the work within 4 months time as stipulated in the work order issued in favour of the 1st party for completion of the work, In the event of failure of the 1st party to commence and complete the work with in the stipulated time the 1st party would be subjected to diverse punishment viz imposition of liquidated damage, cancellation of contract forfeiture of security money and performance bond and sale of plants and machineries if the 2nd party deemed fit and necessary to recover their claim, The 2nd party however failed to supply the approved site plan and working drawing for the whole contracted work either on the day of issuing the work order on 27.08.1994 or within the commencement period of 15 days to execute and complete the work within target period of 4 months. On receipt of the work order on 27.08.1994 the 1st party at site on 31.08.1994 deposited samples of bricks and sands for laboratory test under intimation to the 2nd party. But unfortunately the 2nd party defaulted in their performance and contractual obligation by not supplying the site plan and working drawing and without these two material documents execution of the work was impossible. The 1st party requested the General Manager (Engg) to arrange supply of the drawings by their letter dated 04.09.1994 and 28.09.1994. After 26 days of the work order the draft site plan was approved by the 2nd party and it was supplied to the 1st party on 22.09.1994. The 2nd party again defaulted in not supplying the working drawing along with the site plan.

(3.) The 2nd party caused serious hindrance in the work progress consequent upon which the 1st party suffered tremendous financial hazards. The 2nd party instead of doing some thing that can enable the 1st party to start execution of the work they very surprisingly stopped the work for indefinite period except barbed wire fencing work by their letter dated 20.10.1994. While the contracted work was directed to be stopped the 2nd party failed to instruct the 1st party to release the workers except the workers engaged for barbed wire fencing work. The 2nd party on 19.03.1995 supplied part drawing of note verification hall and cash department upto the plinth level without supplying drawing for door, window, grills and false ceiling and truss. The 1st party asked the 2nd party by their letter for supply of complete drawing so as to enable the 1st party to complete the work without further delay, besides requesting the 2nd party to pay compensation to them for loss they incurred for con- ducting the work for an unreasonable period. Due to such delay extension of time was indispensable. Therefore the 1st party asked the 2nd party to accord time extension considering 2nd party's failure to provide working drawing in due course of time. The 1st party complained that they sustained heavy financial and business loss for continuing the work beyond the stipulated 4 months time. The 1st party in their letter requested the 2nd party to compensate the loss. The 1st party's loss could have been mitigated if the bill for excess additional work done as per direction of the 2nd party had been given as per direction of the 2nd party. The excess work was done in 1995 and despite repeated written and verbal request the bill in question was not paid even in 1997. Thus being aggrieved the 1st party applied to the General Manager (Engineer) department of the 2nd party to negotiate and arrange payment of compensation to them. But the General Manager utterly failed to negotiate the matter. The 1st party contended t there was no alternative than to refer the matter to arbitration. Accordingly the 1st party under Clause 28 of the contract (Green form) applied to the General Manager (Accounts) to appoint a sole arbitrator on 14.10.1997 within 15 days and settle the dispute by an award for payment of compensation to the 1st party.