The distributorship agreement was to remain in force until terminated by either party without a cause by serving 90 days advance notice. The agreement also provided an option to OTIS Elevator Company to terminate the agreement immediately after serving a notice of default to the distributor, and if the default continued for 10 days. The OTIS Elevator Company served a notice of default and the distributor did provide explanation to it, however the explanation was not accepted by OTIS Elevator Company and it terminated the distributorship agreement. The distributor immediately rushed to the High Court for interim orders for injunction on the ground that it promoted and build-up business of OTIS products and equipments in the market of Pakistan, and due to its efforts business of millions of dollars was provided to the OTIS Elevator Company. The distributor alleged that as a result of termination it has suffered heavy losses and its longstanding business and reputation has suffered irreparably.
On the application for injunction, the court did not pass any interim orders and issued notice of application to OTIS Elevator Company. Upon service of notice, OTIS Elevator Company filed its detailed reply to which the distributor filed a rejoinder, and on the basis of pleadings the High Court Judge heard the arguments at length and dismissed the application for injunction.
The distributor has filed an appeal before a Division Bench of the High Court for setting aside the order dismissing the injunction application. The order of trial judge is likely to be maintained by the Division Bench of the High Court.
The author of this news item defended the injunction application before the trial judge of the High Court and will be defending the order before the appellate Division Bench of the same court.
Khalid A Rehman, IDI Country Expert for agency & distribution in Pakistan