Contractors drag govt to court over road deal

Two local construction companies have sued the government at the Commercial High Court over a misunderstanding that cropped up after the firms, in a joint venture, won a tender to rehabilitate a 34km feeder road connecting Rusizi-Ntendezi-Mwityazo, in the Western Province, which was later nullified. The two firms, BERCO and Enterprise de Construction Emmanuel N Sebulikoko claim to have won a tender that is valued at Rwf3.4 billion, in November last year, but Rwanda Transport Development Agency (RTDA) cancelled it on grounds that they received a consortium agreement from the bidder in April while project implementation was within 10-month of deadline, which implied that the bidder wouldn’t finish the rehabilitation ahead of the deadline. RTDA also proposed the re-allocation of 70% of the funds to Musanze-Cyanika road. The re-allocation was approved by the former Permanent Secretary in the Ministry of Infrastructure, prompting the bidder to take the issue to authorities including the Ombudsman and the Minister of Justice, before petitioning the court. Although both the Minister of Justice and the Ombudsman advised that the two parties solve the issue amicably, RTDA is alleged to have refused to negotiate and the two parties, appeared in court yesterday. Appearing before court on Tuesday, State Attorney Theophile Mbonera requested the court to give him more time so that the case can be solved out of court but the judges rejected the request. “The Ombudsman’s office and the Ministry of Justice had requested that plaintiff should give more time to a negotiated solution, out of court,” Mbonera told court. However, the plaintiffs, through their lawyer Aloys Mutabingwa said; “Considering what has been happening, I believe my clients’ rights were violated. There was ample time to solve the matter out of court, but RTDA showed no interest,” the lawyer said. Mutabingwa requested the court to call the African Development Bank (AfDB) which is the financier of the project to appear as amicus curiae (friend of court) but the State Attorney objected, saying that AfDB could not appear before court because they have diplomatic immunity. Meanwhile, SundayTimes has seen a ‘final notification letter’ that was written by RTDA in November 2012, confirming that BERCO and Enterprise de Construction Emmanuel N Sebulikoko had been awarded the tender. Legally, the letter may serve as a contract before the bidder gets a final contract. However, according to RTDA, the enterprise could not be granted a final contract because they violated the terms of the bidding agreement. Article 38 of the bid indicated that the winner of the tender had to provide a performance security from a financial institution within 28 days upon receiving the final notification letter. It emerged the contractors produced their performance security on January 23, 2013, a couple of weeks past the deadline which prompted RTDA not to enter into a final contract with the enterprises. The Commercial High Court scheduled to hear the case in substance on July 19.