Breach of Contract: TCN MD Risks Jail for Court Contempt
Tobi Soniyi
A High Court of the Federal Capital Territory (FCT) has ordered the Managing Director of the Transmission Company of Nigeria (TCN), Mr. Usman Gur Mohammed, to appear before it on September 5, 2019, to explain why he should not be sent to jail for disobeying its order restraining him and his company from shutting down plants and machinery of Phase3 Telecom Limited.
The court had on May 28, 2018, restrained TCN from shutting down the plants and instruments of the independent Fibre Optic infrastructure and telecommunications services provider pending the hearing and determination of the suit filed by the telecoms firm.
The court also stopped Mohammed from acting on the letter by TCN dated August 30, 2017, purportedly terminating the agreement between it and Phase3 Telecom on March 20, 2006, to design, build, finance and operate the Fibre Optic Telecommunications Infrastructure (Phase3 concession agreement) pending the determination of the suit.
On August 16, 2019, the Abuja High Court gave an order granting leave to Phase3 Telecom to effect service of form 49 (notice to show cause why order no: R/N 11623088 and 11623089 should not be made) on TCN and its MD, Mohammed, who are being sought to be committed to prison for contempt by substituted means.
The court ordered that the applicant should serve Mohammed and TCN the committal to prison notice by pasting the processes at the head office of TCN at Plot 441 Zambezi Crescent in Maitama, Abuja, including publishing it as adverts in some key newspapers.
TCN had on March 20, 2006, signed an agreement with Phase3 to design, build, finance, and operate the fibre optical cable telecommunication infrastructure. In a letter dated August 30, 2017, and addressed to the management of Phase3 Telecom Limited, the TCN cancelled the agreement, citing breach of contract terms. The telecoms company had repeatedly denied breach of the agreement terms, insisting on the ownership of the fibre optic infrastructure.
He said despite inheriting a non-existent fiber optic network from TCN, the concessionaires have deployed a total of over 3000km and installed state-of-art fiber optic equipment, expending more than $100 million as capital and operating expenditure on building the infrastructure.