The Department of Roads and Transport has welcomed the adjudicator’s judgment of dismissal of the claimants’ case in respect of the Routine Road Maintenance (RRM) alleged breach of contract between the department and several contractors. The decision was handed down by Advocate FJ Nalane-SC- an adjudicator.
Contractual disputes arose out of claims by 69 claimants, lodged in 2008 by Babazani Trading and Projects CC and 24 others, for alleged breach of contract. The claimants were awarded contracts to perform routine road maintenance in and around Gauteng. Claimants were seeking payment for damages with interest collectively amounting to approximately R400 million.
These were contracted projects undertaken under the auspices of Roads Infrastructure Strategic Framework for South Africa (RISFSA) routine road maintenance contracts. They are tendered contracts and winners are bound to facilitate active participation by small and emerging contractors.
In welcoming the decision, MEC Kedibone Diale-Tlabela added the Department is “pleased this judgement not only removes the uncertainty created by this legal challenge.
“The judgement further enables the Department to focus its energies on pursuing its mandate of delivering a world-class road infrastructure that facilitates economic participation and growth, inclusivity as well as improve the lives of people in Gauteng,” the MEC said.
The claimants had referred the matter for adjudication against the Department, the Accounting Officer (HoD) and the Member of Executive Council (MEC).
In lodging the claim, the claimants relied on material terms and conditions which included that:
- Each would perform routine road maintenance in various areas and routes allocated to them within the province.
- Commencement date of the contract was set for 01 December 2008.
- The duration of the contract was for a period of two years.
- The agreed contract price was fixed and to be paid monthly to claimants by the Department.
They further claimed the Department was in breach in that it failed to, amongst others:
- Issue work orders they were entitled to.
- Pay certain invoices, plus interest.
- Pay escalation costs.
The adjudicator dismissed the claims on procedural grounds and these were:
- Some claimants did not refer their claims either timeously or at all.
- Adjudicator did not have powers to adjudicate disputes as some claimants referred their claims for adjudication to Mogotsi (not an appointed adjudicator) who decided and issued awards.
- Some of the claimants never referred their claims to the appointed adjudicator at all and are time barred; and
- Some claimants never referred claims to the appointed adjudicator and instead approached the Office of the Public Protector. The contract, NEC3 (New Engineering Term Service Contract) contract explicitly prescribed that “in the event of a dispute, this would be initially referred to the adjudicator for adjudication”. This group is also accordingly time barred
For more information, please contact the Department’s Head of Communications Ms Melitah Madiba on 073 644 9935 or MEC’s Spokesperson Mr Lesiba Mpya on 078 450 9841 or email at pressoffice.gpdrt@gauteng.gov.za
