Donnerstag, September 09, 2010

Learning From The Master...

There's an article in today's FAZ. Just in German, but let me give you the gist of it. It's too precious for words...

German development aid is largely organized by something called the GTZ, the "Gesellscahft für Technische Zusammenarbeit" or Society for Technological Cooperation. The GTZ is active in the Congo, it's one of the key countries for German development aid.

The accounts of the GTZ have been frozen and the building they own there has been confiscated.

What happened? Someone take off with the books, disappear with the petty cash, run away from the bills with a new car for a mistress?


Instead, it's the lawyers. In this case, Congoese lawyers.

Tabura Kashali trades in wood in Goma. Back in 1994 he was supposed to deliver wood to a refugee camp. Of the 3400 cubic meters he was to deliver, 2820 never arrived, and he claimed it was stolen. He demanded $47k for the entire delivery, although security was his job. The GTZ paid him $8500. Four months later, Kashali sued the GTZ in the Congo courts, demanding $15k additional payment. The judge awared him $150k, i.e. 10 times the amount. The GTZ appealed, and Kashali counter-sued, asking for $33.8k, $80k in lost profits and $190k in damages and interest, using the same judge. The GTZ lost the appeal and was sentenced to pay the sum total of $280k. This was 2006.

At this point the Congo government intervened and paid $150 920, which at that point was exactly half of the sum owed (with interest). That was 2007. This year - three years later - Kashali demanded the other half plus interest, which had grown to $91 150 on top of the $150 920. Otherwise he would request that GTZ property by seized to pay these debts. The GTZ went to the German Ambassador, who tried to talk to the Minister for Development, who couldn't be bothered to meet with him. On 2 June 2010, Kashali demanded, on top of the monies owed to him, $1.5m dollars in damages. The GTZ had to set up a deposit account with close to $250k in it to avoid having their accounts seized.

In a second case, the "Initiative congolaise pour la gestion autonome des populations" or ICGP, was hired by the GTZ in 2002 to help after the volcano eruption in Goma. The ICGP, which is an NGO, received around $1mn to help, but it became quickly apparent that they were both incompetent and corrupt, and the GTZ cancelled the contract. The ICGP promptly sued, found the right judge, and has now seized the GTZ building in the Congo and has frozen over 44 GTZ accounts.

Adding insult to injury, the GTZ now has to pay $20k/month to use their own building, reflecting a rental contract that they did not even sign. If they don't pay, they will be locked out of the building and would have to leave the country.

The Germans (as opposed to the ex-colonial powers, the French and the Belgians) now have a reputation for being easy prey. After being fired, one former employee sued for $1.9mn damages, his wife (who quit her job) has sued for $51k in damages.

There is a treaty between Germany and the Congo which expressly acknowledges that the GTZ does not have immunity before the courts, but which expressly also states that accounts can't be frozen. This is being explicitly ignored by the courts.

It doesn't stop the Germans from investing in the Congo: they are to deliver new turbines for the hydroelectric plant in Inga, near Kinshasa, for between $15mn and $40mn, depending on the size of the project.

Well, one thing is clear: the Congo does not need any help whatsoever in regards to lawyers, they seem to have learned well enough from American trial lawyers to strike out on their own.

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