THE ROLE OF THE COMMON COURT OF JUSTICE IN THE SETTLEMENT OF BUSINESS DISPUTES IN AFRICA

CHAPTER ONE

GENERAL INTRODUCTION

1. 1 BACKGROUND TO THE STUDY

The origin of dispute settlement is lost in obscurity.[1] In all religions there are many injunctions to be at peace with one’s neighbors and to be reconciled speedily with and adversary. Aristotle urged the benefits of conciliation.[2] In Heraldus’ Animadversiones, there is described a court of reconcilement that existed among the Greeks, it was common among the Roman “to put an end to litigation” by means of arbitration.[3] The introduction of arbitration seems to be coeval with the foundation of our law.[4] In the earliest forms of society disputes were tried by the head families whence id derived the patriarchal tribunal now given to the office of arbitration.[5]

Commercial arbitration is a process which has evolved with a gradual progress with a lot of events. The first took place some eight years ago, in 1923. There are negotiations currently going in the United Nations Commission on International Trade Law (UNCITRAL) that may lead to new developments.[6] The developments that take place at the international level are implemented by states at different times, some sooner, and some not at all. The growth of investment arbitration as a form of international commercial arbitration promises to have a significant impact on the entire field, but the nature of that impact is not yet clear.

It is very common to say that commercial arbitration had its beginning with the practices of the market and fair courts and in the merchant gilds. It is true the gild merchant had wide grants of power as to trade. Mercantile charters were granted to ‘’the men of Ipswich”[7] and to the ‘’ men of Gloucester”[8] and to most of the trade towns, entitling those so chartered to extensive privileges and rights. They were monopolistic in character and in many cases, the right to trade in a borough depended upon membership in a chartered gild. They took active part in the government of the town, though their chief function was the protection of merchant privileges, guarding not only the local gildsman’s interest but also that of town borough government whose duty was to maintain and regulate the trade monopoly.

In many Sub-Saharan countries, mediation and conciliation have traditionally been practiced in case of employment and family law.  In the event of labour disputes, parties made a conciliation effort; if this failed, the case went to the court. The use of arbitration processes in former French colonies, was established by laws within several sectors, including criminal cases.

Economic litigation, namely, in matters relating to customs fraud and public procurement can be settled, thus avoiding public action and recourse to justice. In other words, there is no real separation and even less opposition between, on the one hand, mediation, conciliation, arbitration and settlement and on the other court decision. Natural persons, legal entities and public bodies can use all these amicable or appropriate disputes resolution mechanisms. Apart from this, preliminary conciliation, if required by law, usually appears to be a pure formality, both for the plaintiff and the judiciary, in case in which any possibility of settlement is obviated by contentious intent. Consequently, it is reduced to nothing more than a procedural formality to protect one’s self from potential inadmissibility of the claim in court.[9]

Africa offers immense natural resources and business opportunities for foreign direct investment, which are essential to the world economy.[10] Concurrently, “financial backers often complain about legal and judicial uncertainties in Africa”.[11] Foreign investors are traditionally suspicious about Africa national judicial systems, which have been plagued by corruption, long and costly procedures, and lack of efficient enforcement of the law.[12]

Therefore, in the early 1990s, facing a reduction in investment, West and Central Africa countries decided to combine their efforts to solve the reluctance of investors to come to Africa because of the disparity of and lack of cohesive business laws across borders. These countries established a “High Level Mission” (hereinafter “the Mission”), led by Mr. Keba Mbaye (former Vice President of the International Court of Justice), in order to diagnose the problem and find an appropriate solution. The Mission concluded that a lack of judicial and legal security and lack of governance created an unattractive investment environment.

To solve this problem, the Mission proposed the creation of a new business law intended to be “Modern”, “ Harmonized”, and “interpreted by lawyers well trained in business law”, the application of which would be secured by a “unique supranational court”.[13]

The idea led to the signing of the Port-Louis Treaty in 1993, which created the Organization for the Harmonization of Business Law in Africa (OHADAA, French acronym for Organization pour L’Harmonisation en Afrique du Droit des Affaires).[14] The organization was aimed at harmonizing the business law of different African countries by establishing common rules that would be simple, modern and adapted to each country’s situation. This allowed them to be more competitive in the world economy.[15]

The 1993 OHADA Treaty,[16] provides a single unified legal framework for business law in the region. Among its institutions is the common court of Justice and arbitration(CCJA), whose seat is in Abidjan (Ivory Coast). In 1998 the OHADA Arbitration Act came into force, together with the Rules of Arbitration of its Common Court. In its administrative capacity the court administers arbitration referred to it by the parties and scrutinizes draft arbitration awards. Arbitration legislation in the OHADA countries allows award by consent. This occurs typically when opposing parties reach settlement after the case has been transmitted to the Arbitral Tribunal.

The history of arbitration, unlike the history of law is not an account of the growth and development of principles and doctrines that have come through a long use, to have general validity and force. While arbitration probably antedates all the former legal systems, it has not developed any code of substantive principles, but is with very few exception, a matter of free decision, and each case being viewed in the light of practical expediency and decided in accord with the ethical or economic norms of some particular group.

STATEMENT OF THE PROBLEM