E44M CONTRACTOR LOSES CASE AGAINST THE STATE

The incomplete building which was at the centre of controversy.

MBABANE – The contractor that was awarded a government tender worth over E44 million has lost its case against the State.

Phuthuma Building Construction (PTY) LTD was the contractor that was awarded the tender for the construction and rehabilitation of an office block at the Ministry of Home Affairs, Ministry of Health and Ministry of Justice and Constitutional Affairs.

This building turned into a white elephant after the company and government were embroiled in a battle over a contract. It has been lying idle for over two years while the company and government were locked in a court battle. The award, by the arbitrator, means that government can engage or appoint another construction company to continue building the structure.
The construction company took government to the High Court after its contract was unilaterally terminated by the Ministry of Public Works and Transport but the matter was decided by an arbitrator.

The arbitrator, who was appointed by the Chief Justice Michael Ramodibedi to hear and determine the matter, was senior Lawyer Cyril Maphanga.
The arbitrator said from the long and vexed history of the matter it was evident that the construction company launched a strident campaign by holding over the site, refusing to vacate and forcing government to bargain with it while works were either suspended or were being carried out half – heartedly at a slow pace.

“The situation remained from August 2011 until February when the claimant (Phuthuma Building Construction) launched the High Court proceedings for an injunctive relief and the referral of the dispute to arbitration when the employer (government) was going about seeking the appointment of a replacement contractor,” he stated.

Maphanga said the action taken by the contractor, belatedly, was something that it could have done two years ago when government determined the contract. “The situation that has risen whereby the site has been left derelict for a period exceeding two years virtually at the instance of the contractor as it goes about ‘seeking’ just desserts is unimaginable in the modern construction industry and goes against the ethos and best practice attendant on the proper and efficient administration of the form of contract entered into by the parties in this case,” reads part of the award by the arbitrator.

The arbitrator further noted that, although the contract had a fixed period performance and completion of works, this did not render it one where ‘time was of essence’. The misunderstanding between the two parties (Government of Swaziland and Phuthuma Construction) was over a written contract which was entered into between the two parties. Lawyers representing the construction company decided to seek legal recourse after an advert was placed in the local newspapers inviting interested companies to tender for the same job.

This is said to have happened while workers from Phuthuma Building Construction were still on the site.
The construction company was represented by lawyers from CJ Littler while Senior Government lawyer Vusi Kunene from the chambers of the Attorney General appeared for the State.

Post your comment

Your name:

Your e-mail address:

Add your comments:

Please enter the code you see in the image:

Image:

Code: