Tuesday, February 12, 2013

RDA to pay BY's company K44bn over termination of contract

RDA to pay BY's company K44bn over termination of contract
By Mwala Kalaluka
Tue 12 Feb. 2013, 15:00 CAT

FORMER defence minister Ben Mwila's company, Wade Adams Piling, will be paid about K44 billion by RDA over its terminated K80 billion Landless Corner-Mumbwa road project.

Mwila succeeded in the arbitration process against Road Development Agency (RDA), which terminated the road contract due to non-performance on Wade Adams' part.

But the RDA says the procurement process to engage a new contractor to complete the stalled Landless Corner-Mumbwa road project following the termination of the Wade Adams contract in November 2011, was advanced.

Sources close to the issue told The Post that Mwila's firm, which had contested the termination of the road contract in the courts of law, had emerged victorious from the arbitration process after the terminated contract's arbitration clause was brought into perspective.

"They just went into the arbitration clause; this is a clause that is in the contract in case of disputes and they found that the RDA handled that contract carelessly from the beginning," the source said.
"So BY Ben Mwila has been awarded about K44 billion and this is money that has been committed to the government."

The sources, however, said out of the K44 billion, Wade Adams Piling was expected to pay off about K11.5 billion that was advanced to it as 15 per cent advance payment prior to commencing the futile road works.

Wade Adams Piling was also advanced with a performance bond of K8 billion and at the time of the termination of the above road contract, the RDA had written to the bank and the insurance firm that guaranteed the performance bond in order to recover the whole amount.

Wade Adams Piling had only done 11 per cent works on the 65-kilometre stretch, which was supposed to be upgraded from gravel to tarred road, at the time the contract was terminated.
Mwila, when asked to comment on the matter yesterday, referred all queries to his lawyers Malambo and Company.

"I have got lawyers, specifically Mr Haimbe (Hamakuni). He is the one you should ask," said Mwila without divulging further details.

But when asked to confirm the new twist in the Landless Corner-Mumbwa road project termination issue, RDA chief executive officer Bernard Chiwala said on Friday that the only thing he knew was that a fresh contractor was being sought.

"Those details," said Chiwala when asked on the K44 billion to be paid to Mwila. "All I know is we are getting a new contractor. We have advanced. The tender is closing on 22nd February, 2013. I haven't been briefed. All I know is that the tender is closing on 22nd February."

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