Government risks losing Africa Development Bank (AfDB) funding for the Monkey Bay Stadium following a protracted legal battle in which a construction firm has sued it for alleged wrongful termination of a K117 million contract to complete the project.
Court documents show that the Ministry of Local Government and Rural Development’s financing wing, Local Development Fund (LDF), cancelled the contract with Lloyd Electrical and Building Contractors, alleging that it failed to complete the project in March this year, as per agreement.
But in June the contractor obtained an injunction from the High Court in Zomba, stopping government from terminating the contract. The court order further restrained newly-hired OPCO Limited from completing the project until the court rules on the matter.
Since then there has been no progress and a visit to the project site by the Weekend Nation just found heaps of soil on what is planned to be the pitch.
In an attempt to vacate the injunction, the Attorney General (AG), through senior state advocate Apoche Itimu, wrote the court expressing concern that the restraining order could jeopardise funding since the AfDB disbursement deadline was this month.
The application for vacation of the injunction in part says that due to the project delays “government decided to terminate the contract with the plaintiff and engage another contractor to complete the work as the project with AfDB is coming to an end on 1st September, 2016.”
The contract between Lloyd Electrical and Building Contractors and LDF, signed on August 18 2015, shows that the project was supposed to run for three months from October 14 2015. However, government’s delay to issue the contractually agreed 20 percent upfront payment forced LDF to extend the completion period to March 2016.
But government argues that the termination of the contract came after an assessment showed that there was little progress on the project.
“When the AfDB made a supervisory visit to the site on 11th May 2016, they noted lack of progress and when a quantity surveyor was engaged to quantify the work done so far, it was only less [than] 20 percent of the work that had been done,” wrote the senior state advocate in her submissions to the court.
But Lloyd Electrical and Building Contractors, through legal firm Francis Flanklin and Company, claims, in its application for the injunction, that it did 75 percent of the agreed work. It further attributes the delay to complete the project on rains that disrupted its work.
Judge Zione Ntaba ruled that the injunction should be sustained despite the government’s arguments. Meanwhile, government has resolved to take the matter to the Supreme Court of Appeal.
In an interview, LDF development communication specialist Booker Matemvu said that they will ask AfDB to extend the funding disbursement period following its expiry on September 1 this year.
“What we are planning to do is to formally ask the financier for a grace period because of the challenges we have faced. Hopefully the bank will understand our situation,” he said while refusing to take more questions because the “matter is still in court.”
On his part, Lloyd Electrical and Building Contractors company secretary, Mackion Mpukusa Phiri, confirmed the legal action in an interview, saying: “All we want is justice.”
According to the information we have gathered, Lloyd Electrical and Building Contractors was the second contractor to have its contract dismissed. The first was Maoni Building and Civil Engineering Contractors, which was engaged three years ago.
Lloyd Electrical and Building Contractors Limited, among other facilities, was supposed to lay down a natural-turfed pitch and stands, among other facilities.
The stadium, which is aimed at improving sports and generate revenue for government, is part of the Monkey Bay Rural Growth Centre, an initiative through which other structures such as cotton processing factory and tele-centre have been constructed. n