Zaafarana Beach Resort / IPI - WARNING!

[Zeiad Yehia]

Dear All,

This post has been made after very sufficient investigation.

Kindly be informed that The Due Diligence of Zaafarana Beach Resort has been checked and investigated, and the check has resulted in the fact that El Mohanad Real Estate Company is the legitimate owner of the project. They have had a construction agreement with IPI that does NOT entitle IPI the right to issue contracts to the clients as First Party. This was basically wrong, very wrong!

The contracts not only were issued in a different language that the authenticated one in Egypt "Arabic", but more seriously they were issued by a non-owner, who had no right to issue these contracts in the first place.

Subsequently El Mohannad Company are suing IPI for misrepresentation and to revoke the constructions' contract concluded between them.

I have searched for el Mohannad Real Estate Company's contact information, and eventually succeeded to speak to the Project Manager and Head of Legal Department. They told me that they have sent an offer to the clients already, to deal directly with the developer, because IPI, and I fully agree with this part, have no legal authority whatsoever on the project.

The Developer has confirmed having received € 20,000 - € 22,000 on each client from IPI, and they are ready to elucidate the transfer statements, summing up to approximately € 14,000,000 from IPI on all clients, whilst IPI has collected in the process approximately €42,000,000 from the clients according to the estimations of The Developer. This last part, again, was stated by The Developer yesterday.

Now this is a serious situation which needs to be encountered. I can confirm in full confidence that all the contracts issued by IPI until this moment are not worth the papers they were written on.

I have to add that I have a lot of respect for IPI over a dispute we had a few years ago, ending in their chairman responding sensibly to my legal suggestions to rectify the situation over a different project, but this is a different story completely with Zaafarana Beach Resort.

FYI.

All the best,

Zeiad Yehia
Barrister

 

[realinvestor]

Hi Zeiad Yehia

Thanks for this very imporatnt and timely information regarding deep problems for IPI and also Zafarana investors. Are you a ZBR investor yourself and as a Barrister are you practicing in the UK? Your help will greatly be appreciated by many IPI investors. Is it possible to send your email address?

 

[Zeiad Yehia]

Hi Zeiad Yehia

Thanks for this very imporatnt and timely information regarding deep problems for IPI and also Zafarana investors. Are you a ZBR investor yourself and as a Barrister are you practicing in the UK? Your help will greatly be appreciated by many IPI investors. Is it possible to send your email address?

Dear Sir,

Thanks for your post. Kindly be informed that I am not an investor with IPI. I am an Egyptian barrister who is a member of The Law Society of England and Wales; International Division. I am representing some clients who had unfortunately purchased there, and now encountering legal problems for the above reasons. I have to emphasize, however, that I have started representing them very recently, long after they have already purchased there, otherwise my due diligence check would have never allowed them to proceed forward with the transaction.

Please post any legal questions you might have on the topic here on the thread and you will get an answer free of charge. You can get my contact information from The Law Society's website if need be.

All the best,

Zeiad Yehia
Barrister

 

[realinvestor]

Thanks for the reply. Can you send me your email address and details so I can contact you directly with a possibility you could represent other investors as well.
.

Dear Sir,

Thanks for your post. Kindly be informed that I am not an investor with IPI. I am an Egyptian barrister who is a member of The Law Society of England and Wales; International Division. I am representing some clients who had unfortunately purchased there, and now encountering legal problems for the above reasons. I have to emphasize, however, that I have started representing them very recently, long after they have already purchased there, otherwise my due diligence check would have never allowed them to proceed forward with the transaction.

Please post any legal questions you might have on the topic here on the thread and you will get an answer free of charge. You can get my contact information from The Law Society's website if need be.

All the best,

Zeiad Yehia
Barrister

 

[Londontommy]

Hi Zeiad
Thank you for your posts, which are very informative.
Can I please ask you, as a purchaser of an apartment on the Zafarana development, what advice could you give me as to what action I should be considering now and why?

 

[Zeiad Yehia]

Hi Zeiad
Thank you for your posts, which are very informative.
Can I please ask you, as a purchaser of an apartment on the Zafarana development, what advice could you give me as to what action I should be considering now and why?

Hello Londontommy,

Have you purchased from the developer directly or IPI? In the event it's the latter then you need to chase IPI for your funds and to reach a compromise with the developer. Unfortunately the developer is not directly responsible against IPI purchaser, given that they did not sign anything directly to the clients, whilst IPI have practiced a de facto developer's role against clients, despite not being so. Hence I always emphasize the extreme significance of checking the due diligence situation IN PRIOR to settling funds to an agent / developer.

All the best,

Zeiad Yehia
Barrister

 

[Londontommy]

Hello Zeiad

Thank you for taking the time and trouble to reply. It is much appreciated. We purchased with IPI.

If the developer and IPI are both in agreement that their whole objective is to finish the resort, now that the development is 80% built, instead of fighting expensive and lengthy legal battles, wouldn’t the developers’ and IPI’s money be better spent on completing the development?
Couldn’t they employ an independent Arbitrator, who could then consider the position of both parties and hopefully resolve their differences and get the development built and operational? This would provide revenue for both parties and us (the purchasers). This would be a win-win solution for everyone.

 

[Zeiad Yehia]

Hello Zeiad

Thank you for taking the time and trouble to reply. It is much appreciated. We purchased with IPI.

If the developer and IPI are both in agreement that their whole objective is to finish the resort, now that the development is 80% built, instead of fighting expensive and lengthy legal battles, wouldn’t the developers’ and IPI’s money be better spent on completing the development?
Couldn’t they employ an independent Arbitrator, who could then consider the position of both parties and hopefully resolve their differences and get the development built and operational? This would provide revenue for both parties and us (the purchasers). This would be a win-win solution for everyone.

Hi Londontommy,

In theory you're 100% right, but in practice the developer claims that IPI owes them over 60,000,000 Euros. They say that the money they've agreed upon with IPI was partly received, and by partly they mean a small amount.

IPI will have a different version of the story I am sure, hence am trying to stick to facts here, and facts will be nothing more the legal documents. I am presuming the worst case scenario, which is not having any future amicable solution between IPI and the developer. According to the developer this is the case, and I haven't heard from IPI on that matter. Presuming that both IPI and the developer had best intentions but followed the completely wrong methodology as in IPI signing the contract as owners, and in English only, now I am thinking on the clients' part; what mistake have they done to deserve to be in the middle of this? Apart from not checking the due diligence beforehand they didn't really do any mistakes, as they have trusted the transaction.

Just to clarify it further; the developer believes IPI owes them millions of Euros, and IPI believes it has done its part of the job, with MANY reservations on my side on that part, since I don't see signing contracts as an owner when you're not as part of the job, but in the event IPI and the developer would reach an amicable solution this'd be for the best interest of everyone of course. Problem is that there are no signs for such a thing so far. I would like to involve in arbitration if they decided to solve it amicably, and I am willing to do it for free even, as I'd have the honour of having contributed to sorting this mess out.

All the best,

Zeiad Yehia
Barrister

 

[East London]

Hi Zeiad

I was under the impression that the actual owners of the land are the TDA and not EMA at this moment in time, they then allocate the land to various parties. Could you confirm if that is true?

Thanks
East London

 

[redangel7861]

Hi Londontommy,

In theory you're 100% right, but in practice the developer claims that IPI owes them over 60,000,000 Euros. They say that the money they've agreed upon with IPI was partly received, and by partly they mean a small amount.

IPI will have a different version of the story I am sure, hence am trying to stick to facts here, and facts will be nothing more the legal documents. I am presuming the worst case scenario, which is not having any future amicable solution between IPI and the developer. According to the developer this is the case, and I haven't heard from IPI on that matter. Presuming that both IPI and the developer had best intentions but followed the completely wrong methodology as in IPI signing the contract as owners, and in English only, now I am thinking on the clients' part; what mistake have they done to deserve to be in the middle of this? Apart from not checking the due diligence beforehand they didn't really do any mistakes, as they have trusted the transaction.

Just to clarify it further; the developer believes IPI owes them millions of Euros, and IPI believes it has done its part of the job, with MANY reservations on my side on that part, since I don't see signing contracts as an owner when you're not as part of the job, but in the event IPI and the developer would reach an amicable solution this'd be for the best interest of everyone of course. Problem is that there are no signs for such a thing so far. I would like to involve in arbitration if they decided to solve it amicably, and I am willing to do it for free even, as I'd have the honour of having contributed to sorting this mess out.

All the best,

Zeiad Yehia
Barrister

Hi Zeiad,

Were you reponsible for the due dilligence on a Project called Hania Beach in Hurghada???

 

[samui13]

Forgive me but Hania Beach is nothing to do with Zafarana Beach Resort is it?

Should a new thread not be started rather than joining an exsting thread. People with issues with Zafarana will not want to go off topic with a different resort.

Lou

 

[Zeiad Yehia]

Hi Zeiad

I was under the impression that the actual owners of the land are the TDA and not EMA at this moment in time, they then allocate the land to various parties. Could you confirm if that is true?

Thanks
East London

Dear Sir,

I am expecting the due diligence documents in a few days from the legal department of El Mohannad Company; the Egyptian developer. I will be able to answer you then based on the facts I will have.

All the best,

Zeiad Yehia
Barrister

 

[Zeiad Yehia]

Hi Zeiad,

Were you reponsible for the due dilligence on a Project called Hania Beach in Hurghada???

Dear Sir,

I am glad to see you again after these years. I believe you were here when it all happened. I have actually warned everyone at the time, refused to have clients purchasing there, and falsified the due diligence report which already existed there. I still have the governmental documents backing my claims these days, but fortunately everyone discovered the truth after that already, and the project has actually closed and changed its name after having new owners.

Hence I am fully responsible for 'falsifying' the due diligence report of that project at the time, and for warning many people, including your kind-self, not to get involved. Kindly refer to the old thread for more information.

All the best,

Zeiad Yehia
Barrister

 

[Zeiad Yehia]

Forgive me but Hania Beach is nothing to do with Zafarana Beach Resort is it?

Should a new thread not be started rather than joining an exsting thread. People with issues with Zafarana will not want to go off topic with a different resort.

Lou

Dear Lou,

Glad to see you here.

And I am thankful for your always constructive contributions.


All the best,

Zeiad Yehia
Barrister

 

[East London]

Dear Zeiad

I was also under the impression from your first post that you have already checked the due diligence? I’m not meaning to be confrontational, but i don't understand.

Thanks
East London

 

[East London]

Dear Zeiad

Are you able to respond to my questions?

Regards
East London

 

[Zeiad Yehia]

Dear Zeiad

Are you able to respond to my questions?

Regards
East London

Hello,

Until the first post I have checked most of them already. Now they've all been checked, and the problem, as explained, is not with the due diligence, but is about IPI not being the legitimate owner. The legitimate owner has got all its papers in place, but the problem is that IPI acted as an owner when it was not. Now purchasers have bought from a non-owner, and subsequently did not acquire ownership.


All the best,

Zeiad Yehia
Barrister