NITEL explains inability to honour Interstella contract

Nigerian Telecommunications Plc (Nitel) has adduced reasons why it failed to honour the contractual agreement with Interstella Communications, a Nigerian Internet gateway operator.

NITEL in a letter dated July 3, 2007 from its lawyers, Messrs Ikechukwu Uzuegbu & Co, and sighted by Champion Infotel, explained that the service could not be rendered due to some restrictions by the SAT-3 network administrator.

The letter endorsed by NITEL company secretary, Hadiza Dogabana Sani, affirmed that Interstella Communication Limited paid the sum of N65.6million for 1*5TM-1-SAT 31 PLC(Half Circuit) capacity.

But lamented that this service could not be successfully carried out by NITEL administrator based on new capacity activation in view of Nitel’s unpaid liabilities.

NITEL further stated that Interstella’s request for collocation services at NECOM House, Lagos, has been confirmed and the cost implication is being worked out in line with the network administrator.

Champion Infotel recalled that a Federal High Court in Umuahia Judicial Division recently ordered Nitel to pay over N14 billion to Interstella for the breach of contract.

Interstella had dragged Nitel to the court on June 15, 2007, praying that the court should declare among others that Nitel’s conduct is a breach of contract, an order directing it to provide it with half STM1 circuit on SAT 3 which it paid for since October 2006.

Interstella also asked the court to order Nitel to pay it the sum of N1.9 billion per annum as revenue accruable to it per annum, 150.000 dollars, being the lost of medical treatment of the Chief Executive Officer of the Company and $2.4million per month, being the monthly revenue accruable to the plaintiff’s investment on half 1*STM2 circuit on SAT3 since October 2006.

The company further prayed the court to order Nitel to pay it the sum of N2billion as exemplary damages for injury inflicted on Interstella business.

And after hearing Chief S.A Solomon Esq., the counsel to Interstella and Ikechukwu Izuegbu, Nitel’s attorney, the court presided over by Justice H.T Soba granted all the relieves sought by Interstella.

The court ruled that Nitel’s conduct is a breach of contract, by failing, refusing and/or neglecting to provide the services contracted by it when leased out its 36 E1 switch ports, 9 E1 transmission Links; and ½ 1 * STM1 Circuit on SAT3 to the plaintiff. Subsequently, the court directed Nitel to immediately provide the plaintiffs with ½ ISTM1 Circuit on SAT3, which the plaintiffs paid for since October 2006.

Nitel was also ordered to pay the sum of N1, 944 billion per annum accruable to the plaintiffs per annum as revenue from their investment on 36 E1 switch port beginning from 2002 accumulated is paid in arrears.

Besides, Nitel was also ordered to pay the cost of medical treatment of the 2nd plaintiff/ Chief Executive Officer amounting to the sum of 150,000:00 Dollars.

And to cap it all the court directed Nitel to pay 30 per cent per cent interest rate until date of judgement and thereafter at 25 per cent until date the liquidation of judgement debt hereby granted.

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