There was a great sense of anticipation at the Supreme Court this morning as the Chief Justice sat to deliver his judgment in the case of Sagis Investments versus Krem Radio. If Sagis won, the Ashcroft controlled company would get a seat on Krem’s Board of Directors and a 10% holding in the community-based radio station; while if Sagis lost, Ashcroft, his British Queen’s Counsel and his dollar dynamo would have been outmatched by a small media house from Lake Independence. Sharp contrast and high stakes – and Chief Justice Dr. Abdulai Conteh ruled in Krem’s favour.
In a 31 page judgment, he found that Sagis had failed to prudently look after its investment by engaging in a share transfer arrangement with a shareholder, Evan X Hyde, who was not free to divest of his shares – without first offering it to other shareholders – which is called the right of pre-emption. That’s what Krem’s Articles of Association say and the Chief Justice scolded Sagis for never looking it up, concluding, that, quote: “a prudent and business-like person would….have inspected these public documents to see if there were any restrictions on the transfer of its shares.”
The Chief Justice also rebuked Sagis for waiting 13 years to ask for its share certificate; he concluded that there was nothing businesslike about this delay. With that, he dismissed Sagis’ claim and concluded that they are not entitled to any rights in or ownership of Krem Radio – as Sagis has never been a holder of 10% in Krem. But that comes at a cost to Krem, as the Chief Justice ordered that Krem should follow through with its offer to repay the $25,000 loaned by Sagis. But it must re-pay this plus interest at a rate of 6% annually. Over 13 years, the total interest is a little over $20,000. But Sagis will have to be paying something too. The Chief Justice ordered Sagis to pay costs of $30,000 to Krem Radio.
It is a decisive victory for Krem – but not a free one, still, Mose Hyde was glad for it.
Mose Hyde, Krem Radio
“We are pleased, very very pleased and relieved but we are confident that this process will continue. This is a conflict that will not go anywhere, that is the conflict between Kremandala and Market Square and its interests but we are pleased with today’s verdict.”
Jules Vasquez,
You all will have to pay something towards them as recompense, I think $25,000 plus 6% over all those years.
Mose Hyde,
“Yeah, that demonstrates again, I guess the bottom line because when you go and you think about this case, it is unusual for somebody to come out of a court and say you have won and the verdict is that you have to pay. But that demonstrates that it is presence and it is the principle that victory comes because we remain virus, that is without the tentacles of Michael Ashcroft inside our company. And so we are pleased with that and would willingly and right now, try our very best to find that money to pay him and get him from our midst.”
Michael Young, Attorney for Krem
“In fact Evan had indicated from before the case that he was willingly to return the $25,000 because it is the proper thing to do. This idea about dishonesty and so on that they put in the newspaper is totally distorted and has absolutely no foundation.”
Janelle Chanona, News 5
“Mr. Young I gathered the pre-emptive rights were your strongest grounds?”
Michael Young,
“Absolutely, this was the ground from time when I was consulting in relation to the case that I indicated to them in my view that purported transfer was exactly that, a transfer, the document signed, and as the Chief Justice pointed out, it says there that it was subject to the articles of the company, public documents which Sagis and their attorneys could have checked. They did not check and now they come to court to say it really wasn’t that and that is not what was applicable so they are caught by it.”
Dr. Elson Kaseke appeared for Sagis and could not say whether his client would appeal. But, if Ashcroft holds to his strategy of enduring litigation - an appeal should be expected. And a statement was issued by Sagis Investments this evening. It says, “Sagis….intends to vigorously appeal the decision announced today in the supreme court on a number of grounds, including the decision not to allow Sagis to amend its statement of claim….to (include) fraudulent misrepresentation against Krem Radio Limited.”
As for Krem, it now has to find about $45,000 to re-pay Sagis – though with an appeal at hand, it’s almost certain that payment will not be accepted. And that’s because Sagis doesn’t want the money, it wants the 10% shareholding.
