Nida washes hands of N$316m industrial parks in DRC, Congo
Burmeister and Partners has dragged the Namibia Industrial Development Agency (Nida) to court over non-payment of about N$8 million.
The engineering company is demanding to be paid for construction work on trade and industrial estates in Lubumbashi in the Democratic Republic of the Congo (DRC) and Pointe-Noire in Congo-Brazzaville, but Nida insists it cannot be held liable for the affairs of its predecessor, the Namibia Development Corporation (NDC).
In 2015, Cabinet approved the establishment of Nida, which took over the functions, assets, liabilities and obligations of NDC and the Offshore Development Company (ODC).
Section 30 of the Nida Act also dictates the transfer of assets, rights, liabilities and obligations of NDC and ODC to the agency, however it disputed that the Act coming into operation effected these stipulations.
According to court documents, Nida and Burmeister and Partners entered into a written agreement on or about 31 July 2012 at Windhoek for the project, valued at N$316 million.
The agreement stated that if the works were postponed, cancelled or abandoned in whole or in part, the engineers would continue with any of the stages referred to in the regulations.
Burmeister and Partners would also be entitled to payment before such works are postponed, cancelled or abandoned plus a surcharge of 10% of such amount.
Court documents further stated that in the event of the engineering works or any part thereof being postponed for a period longer than two years, such works would be considered abandoned.
Pay up
In its particulars of claim, Burmeister and Partners pointed out that between July 2012 to February 2020, it complied with its obligations in terms of the agreement and completed the works; however, the project was postponed for longer than two years and the premises abandoned.
The company said when work was abandoned, it had completed 70% of the civil and structural components and was entitled to N$5.5 million as well as a 10% surcharge on this amount.
For this work, Burmeister and Partners has only received N$3.8 million, it said, for which it invoiced Nida on 27 February 2020.
It added that 60% of the mechanical works were completed and only N$2.1 million was paid of the N$3.75 million invoice.
Furthermore, by the time the work was abandoned in 2020, the company claimed to have completed 60% of the electrical and electronic services and was entitled to N$2.7 million, of which only N$1.4 million was paid.
Burmeister and Partners also informed the court that it had completed 70% of the principal agent work and was entitled to N$2.2 million, but so far only N$1.3 million was paid for this service.
Not our business
Nida argued that the agreement with Burmeister and Partners was entered into by NDC, adding that it was never party to the agreement and cannot be held liable for the payment obligations.
“Nida further avers that no notice - as contemplated in Section 30 of the Nida Act - had to date been published. As a consequence of which, we deny that the contractual obligations of the NDC vests in Nida.
“By virtue of this, we aver that there exists currently no basis in law or fact upon which Nida can be held liable for the payment obligation of the NDC arising from the agreement.”
Meanwhile, in its plea, the agency accused Burmeister and Partners of deliberately omitting the date when the works were abandoned, which according to Nida already occurred on 6 July 2017.
It also said the company should have - and failed to - join the minister of industrialisation, trade and small and medium enterprise development as part of this action.
According to Nida, it is important that the ministry form part of this matter because it was and still is the custodian of now-defunct NDC’s assets, rights, liabilities and obligations, including those emanating from the agreement with Burmeister and Partners.
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The engineering company is demanding to be paid for construction work on trade and industrial estates in Lubumbashi in the Democratic Republic of the Congo (DRC) and Pointe-Noire in Congo-Brazzaville, but Nida insists it cannot be held liable for the affairs of its predecessor, the Namibia Development Corporation (NDC).
In 2015, Cabinet approved the establishment of Nida, which took over the functions, assets, liabilities and obligations of NDC and the Offshore Development Company (ODC).
Section 30 of the Nida Act also dictates the transfer of assets, rights, liabilities and obligations of NDC and ODC to the agency, however it disputed that the Act coming into operation effected these stipulations.
According to court documents, Nida and Burmeister and Partners entered into a written agreement on or about 31 July 2012 at Windhoek for the project, valued at N$316 million.
The agreement stated that if the works were postponed, cancelled or abandoned in whole or in part, the engineers would continue with any of the stages referred to in the regulations.
Burmeister and Partners would also be entitled to payment before such works are postponed, cancelled or abandoned plus a surcharge of 10% of such amount.
Court documents further stated that in the event of the engineering works or any part thereof being postponed for a period longer than two years, such works would be considered abandoned.
Pay up
In its particulars of claim, Burmeister and Partners pointed out that between July 2012 to February 2020, it complied with its obligations in terms of the agreement and completed the works; however, the project was postponed for longer than two years and the premises abandoned.
The company said when work was abandoned, it had completed 70% of the civil and structural components and was entitled to N$5.5 million as well as a 10% surcharge on this amount.
For this work, Burmeister and Partners has only received N$3.8 million, it said, for which it invoiced Nida on 27 February 2020.
It added that 60% of the mechanical works were completed and only N$2.1 million was paid of the N$3.75 million invoice.
Furthermore, by the time the work was abandoned in 2020, the company claimed to have completed 60% of the electrical and electronic services and was entitled to N$2.7 million, of which only N$1.4 million was paid.
Burmeister and Partners also informed the court that it had completed 70% of the principal agent work and was entitled to N$2.2 million, but so far only N$1.3 million was paid for this service.
Not our business
Nida argued that the agreement with Burmeister and Partners was entered into by NDC, adding that it was never party to the agreement and cannot be held liable for the payment obligations.
“Nida further avers that no notice - as contemplated in Section 30 of the Nida Act - had to date been published. As a consequence of which, we deny that the contractual obligations of the NDC vests in Nida.
“By virtue of this, we aver that there exists currently no basis in law or fact upon which Nida can be held liable for the payment obligation of the NDC arising from the agreement.”
Meanwhile, in its plea, the agency accused Burmeister and Partners of deliberately omitting the date when the works were abandoned, which according to Nida already occurred on 6 July 2017.
It also said the company should have - and failed to - join the minister of industrialisation, trade and small and medium enterprise development as part of this action.
According to Nida, it is important that the ministry form part of this matter because it was and still is the custodian of now-defunct NDC’s assets, rights, liabilities and obligations, including those emanating from the agreement with Burmeister and Partners.
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