Contractual row opens can of worms

via Contractual row opens can of worms | The Herald December 24, 2015

Fidelis Munyoro Chief Court Reporter
A contractual dispute pitting Augur Investments and sub-contractor for the construction of the first phase of dual carriage way of Joshua Mqabuko Nkomo Road (Airport Road) could reveal the actual price of the work done on the road at the time Government took over the project, which is likely to be less than what was charged.

The 12-kilometre of the dual carriageway stretches from Coke Corner, Dieppe Road, to the entrance of the Harare International Airport.

T & C Construction, a company sub-contracted to work on the road that was recently commissioned by President Mugabe, is battling to recover $4,8 million from Augur Investments, for services rendered.

The firm won its case in April after an independent arbitrator, Mr D. L. Cruttenden, ordered Augur Investments to pay $3 349 500 to T & C for the construction of the piece of the road and an additional $1 459 500 by June 4 this year.

This makes a total of $4,8 million.

Efforts by T & C to register the arbitration award at the High Court were frustrated after Augur Investments disputed the cash payment.

Although in his affidavit dated May 18 2015, Augur Investments director Mr Kenny Sharpe is not disputing the figure, he is alleging that the $4,8 million was to be made in the form of land as contemplated by the agreement between the two companies.

Mr Sharpe is now seeking to set aside the arbitral award to T & C arguing the payment was due only in the form of land. He is challenging the findings of the arbitrator.

“I respectfully submit that the award goes beyond mere faultiness and constitutes a palpable inequity that is so far-reaching and outrageous in defiance of logic. . . It would be contrary to public policy to uphold it,” said Mr Sharpe in his papers filed at the High Court.

But Mr Allan Tilling Russell, the managing director of T & C, said the fact remained that Augur accepts its debt to his company of $4,8 million. He said the bulk of the amount has been outstanding for more than two years.

“To date, Augur has not stated how it wishes to satisfy this debt,” said Mr Russell. He said the arbitrator in the case made a sensible decision and Augur could not indefinitely refuse to pay. “In the circumstances the award cannot be attacked on public policy grounds.”

T & C has engaged Itayi Ndudzo of Mutamangira and Associates to argue the matter in the High Court on a date yet to announced.

Work on the road began in 2009 under a private partnership agreement between the City of Harare and Augur Investments which only did 2,4 kilometres of a single carriageway before abandoning the project in September 2013. It claimed the work on that stretch had cost $20 million.

The contract was a barter deal between Harare and Augur in which the firm received 733, 9 hectares of land in stands around the city as part payment. The deal, which has always been shrouded in controversy was signed in 2008 and the project should have been completed in 2010.

Speaking during the commissioning of the road, President Mugabe said Zimbabwe had been under siege for a decade and a half and that it could not afford a business-as-usual approach to work if it is to respond adequately to people’s needs through provision of basic expectations.

He called on relevant authorities to engage contractors with high professionalism and high standards of workmanship to ensure value for money for the nation.

He expressed gratitude to the Ministry of Transport and Infrastructure Development for responding positively to the call by Government to take over the project after it had stalled.