Ircon International Ltd, an Indian firm, filed a 15 million Br charge against Nib Insurance Company, Lakachew Baweke, Electro Commercial Co and Transport Djibouti 2000, for insurance coverage and damages to its property during transportation.

The Indian firm had entered a contract with the Ethiopian Electric Power Corporation (EPPCo) for the supply of substation equipments including five electric generators and three transformers in Wolayita Sodo, 385Km from the capital, in the Southern Regional State.

In the explanation of the charges, Ircon says that, following this agreement, it bought an insurance policy signed in October 2009, for the sea freight and inland transportation of the equipments imported from India. However, the insurer refused to pay on the policy for the equipment which was damaged during transportation from Djibouti Port to Wolayita, claimes Ircon in its charges.

After securing the insurance policy, Ircon also said that it had entered into an agreement with Lakachew for custom clearance and transportation of the equipments. However, Lakachew outsourced the transportation to Electro Commercial Co and Transport Djibouti 2000, under whose possession the equipment was damaged.

Lakachew, Electro Commercial Co and Transport Djibouti 2000 are all companies engaged in freight transport.

The truck, belonging to Djibouti 2000, had an accident on its way to Ethiopia in July, 2010, according to the charges.

“The accident created total damage on the imported equipments and its accessories,” Ircon claims.

Nib insurance claims that the damage is not covered by insurance due to the sea freight policy, and refused to cover the damages, according to the charges file signed by Tesfaye Degefa, lawyer of the plaintiff.

“The insurer should pay the damages,” Ircon claims, attaching a Supreme Court Cassation Bench verdict which states that the Commercial Code would apply on accidents that occur on land and not Insurance policy and sea freight.

EEPCo has also decided that all the equipment was totally damaged and needs to be replaced, adding to its cost in taxes of importing more transformers, Ircon contended.

All these expenses amount to 15 million Br and should be paid to it with a nine percent interest, the Indian company said, holding all the defendants liable, jointly and severally. Ircon International Ltd also applied to institute a new suit for when it establishes additional costs of taxation and other costs it may sustain due to the accident.


By EDEN SAHLE
FORTUNE STAFF WRITER